What changed in this filing

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Item 1. Financial Statements

2023-05-04 compared with 2023-02-02 · 96 added, 75 removed, 390 unchanged (30% of the section changed)

5 unchanged sentences

Three Months Ended

Six Months Ended

December 25 ,

December 26 ,

December 25 ,

December 26 ,

Nine Months Ended

COSTS AND EXPENSES:

Cost of sales

General and administrative expenses

15 unchanged sentences

(In thousands , except share amounts)

December 25 ,

CURRENT ASSETS

52 unchanged sentences

Balance, December 26, 2021

Stock-based compensation expense

Balance, March 27 , 2022

Treasury Stock

Retained Earnings

Balance, June 26, 2022

5 unchanged sentences

Balance, December 25, 2022

Stock-based compensation expense

Balance, March 26, 2023

See accompanying Notes to Unaudited Condensed Consolidated Financial Statements.

2 unchanged sentences

(In thousands )

Six Months Ended

December 25 ,

December 26 ,

Nine Months Ended

CASH FLOWS FROM OPERATING ACTIVITIES:

20 unchanged sentences

Payments received on notes receivable

Proceeds from sale of assets

Purchase of intangible assets definite-lived

3 unchanged sentences

Purchase of treasury stock

Payment of convertible notes

Payments on short term loan

7 unchanged sentences

RAVE RESTAURANT GROUP, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL

Rave Restaurant Group, Inc., through its subsidiaries (collectively, the “Company” or “we,” “us” or “our”), franchises pizza buffet (“Buffet

22 unchanged sentences

Fiscal Quarters

The three and six month periods ended December 25, 2022 and December 26, 2021 each contained 13 weeks and 26 weeks, respectively.

The three and nine month periods ended March 26, 2023 and March 27, 2022 each contained 13 weeks and 39 weeks, respectively.

Use of Management Estimates

39 unchanged sentences

Three Months Ended

March 26, 2023

March 27, 2022

Franchise royalties

4 unchanged sentences

Rental income

Six Months Ended

Nine Months Ended

March 26, 2023

March 27, 2022

Franchise royalties

15 unchanged sentences

Note B - Leases

The Company determines if an

arrangement is a lease at inception of the arrangement.

To the extent that it can be determined that an arrangement represents a lease, it is classified as either an operating lease or a finance lease.

The Company does not currently have

any finance leases.

The Company capitalizes operating leases on the Condensed Consolidated Balance Sheets through a right of use asset and a corresponding lease liability.

Right of use assets represent the Company’s right to use an

underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease.

The Company determines if an arrangement is a lease at inception of the arrangement.

To the extent that it can be determined that an

arrangement represents a lease, it is classified as either an operating lease or a finance lease.

The Company does not currently have any finance leases.

The Company capitalizes operating leases on the Condensed Consolidated Balance Sheets

through a right of use asset and a corresponding lease liability.

Right of use assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease

payments arising from the lease.

Short-term leases that have an initial term of one year or less are not capitalized.

does not presently have any short-term leases.

Operating lease right of use assets

and liabilities are recognized at the commencement date of an arrangement based on the present value of lease payments over the lease term.

In addition to the present value of lease payments, the operating lease right of use asset also

includes any lease payments made to the lessor prior to lease commencement less any lease incentives and initial direct costs incurred.

The Company does not presently have any short-term leases.

Operating lease right of use assets and liabilities are recognized at the commencement date of an arrangement based on the present value of

lease payments over the lease term.

In addition to the present value of lease payments, the operating lease right of use asset also includes any lease payments made to the lessor prior to lease commencement less any lease incentives and

initial direct costs incurred.

Lease expense for operating lease payments is recognized on a straight-line basis over the lease term.

22 unchanged sentences

Sublease agreements are not capitalized and are recorded as rental income in the period that rent is received.

As of December 25,

2022 , the Company had no Company-owned

As of March 26, 2023 , the Company had no

Company-owned restaurants.

Information Technology Equipment

21 unchanged sentences

Accordingly, the Company accounts for the lease and non-lease components in an arrangement as a single lease component.

In addition, for all existing asset classes, the Company

has made an accounting policy election not to apply the lease recognition requirements to short-term leases (that is, leases that, at commencement, have a lease term of 12 months or less and do not include an option to purchase the

underlying asset that the Company is reasonably certain to exercise).

Accordingly, we recognize lease payments related to short-term leases in our income statements on a straight-line basis over the lease term.

To the extent that there

are variable lease payments, we recognize those payments in our Condensed Consolidated Statements of Income the period in which the obligation for those payments is incurred.

The components of total lease expense for the six months ended December 25, 2022, the majority of which is included in general and administrative expense in the accompanying Condensed Consolidated Statements of

Income, are as follows (in thousands):

Six Months Ended

December 25, 2022

In addition, for all existing asset classes, the Company has made an accounting policy election not to apply the lease recognition requirements to

short-term leases (that is, leases that, at commencement, have a lease term of 12 months or less and do not include an option to purchase the underlying asset that the Company is reasonably certain to exercise).

Accordingly, we recognize

lease payments related to short-term leases in our income statements on a straight-line basis over the lease term.

To the extent that there are variable lease payments, we recognize those payments in our Condensed Consolidated Statements

of Income the period in which the obligation for those payments is incurred.

The components of total lease expense for the nine months ended March 26, 2023, the majority

of which is included in general and administrative expense in the accompanying Condensed Consolidated Statements of Income, are as follows (in thousands):

Nine Months Ended

March 26, 2023

Operating lease cost

2 unchanged sentences

Supplemental cash flow information related to operating leases is included in the table below (in thousands):

Six Months Ended

December 25, 2022

Nine Months Ended

March 26, 2023

Cash paid for amounts included in the measurement of lease liabilities

Weighted average remaining lease term and weighted average discount rate for operating leases are as follows:

December 25, 2022

March 26, 2023

Weighted average remaining lease term

9 unchanged sentences

2, 2008, the Company’s board of directors amended the 2007 Stock Purchase Plan to increase the number of shares of common stock the Company may repurchase by 1,000,000 shares to a total of 2,016,000 shares.

On April 22, 2009,

the Company’s board of directors amended the 2007 Stock Purchase Plan again to increase the number of shares of common stock the Company may repurchase by 1,000,000 shares to a total of 3,016,000 shares.

On June 28, 2022, the

Company’s board of directors amended the 2007 Stock Purchase Plan again to increase the number of shares of common stock the Company may repurchase by 5,000,000 shares to a total of 8,016,000 shares.

The 2007 Stock Purchase Plan does not have an

expiration date.

On April 22, 2009, the Company’s board of

directors amended the 2007 Stock Purchase Plan again to increase the number of shares of common stock the Company may repurchase by 1,000,000

shares to a total of 3,016,000 shares.

On June 28, 2022, the Company’s board of directors amended the 2007 Stock Purchase Plan

again to increase the number of shares of common stock the Company may repurchase by 5,000,000 shares to a total of 8,016,000 shares.

The 2007 Stock Purchase Plan does not have an expiration date.

The following table furnishes

16 unchanged sentences

November 28, 2022 - December 25, 2022

December 26, 2022 - January 29, 2023

January 30, 2023 - February 26, 2023

February 27, 2023 - March 26, 2023

The Company’s

4 unchanged sentences

(“Hallmark”) pursuant to which the Company purchased from certain direct or indirect subsidiaries of Hallmark an aggregate of 2,246,086 shares of the Company’s common stock at a price of $ 1.60 per share, resulting in an aggregate purchase price of $ 3,593,738 .

The price per share represented the average closing price of the Company’s common stock on the Nasdaq Capital Market for the preceding 15

trading days.

The price per share

represented the average closing price of the Company’s common stock on the Nasdaq Capital Market for the preceding 15 trading

The transaction was approved by the Audit Committee of the Company, which consists of all of the independent directors of the Company.

The Chairman of the Company, Mark E.

Schwarz, who is also the Executive Chairman and

Chief Executive Officer of Hallmark, recused himself from all deliberations with respect to the Stock Purchase Agreement with Hallmark.

Schwarz, who is also the Executive Chairman and Chief

Executive Officer of Hallmark, recused himself from all deliberations with respect to the Stock Purchase Agreement with Hallmark.

Note D - Commitments and Contingencies

9 unchanged sentences

The Company has filed an appeal of the judgment to the Fifth Circuit Court of Appeals.

There are three possibilities upon decision by the Fifth Circuit Court of Appeals:

the judgment could be affirmed;

the judgment could be reversed and the matter sent for a

or, the judgment could be reversed and judgment entered in favor of the Company.

Due to the range of possible decisions by the Fifth Circuit Court of Appeals, it is impossible to predict the ultimate outcome at this time.

The Company is subject to other various claims and contingencies related to employment agreements, franchise disputes, lawsuits, taxes,

5 unchanged sentences

For the three

and six months ended December 25, 2022, the Company recognized stock-based compensation expense related to stock options of $ 4 thousand and $ 8 thousand, respectively.

For the three and six

months ended December 26, 2021, the Company recognized stock-based compensation expense related to stock options of zero and zero , respectively.

As of December 25, 2022, there was $ 8 thousand unamortized stock-based compensation expense related to stock options.

and nine months ended March 26, 2023, the Company recognized stock-based compensation expense related to stock options of $ 4 thousand and $ 11 thousand, respectively.

three and nine months ended March 27, 2022, the Company recognized stock-based compensation expense related to stock options of zero

and zero , respectively.

As of March 26, 2023, there was $ 4 thousand unamortized stock-based compensation expense related to stock options.

The following table summarizes the number of shares of the Company’s common stock subject to outstanding stock options:

Six Months Ended

Nine Months Ended

March 26, 2023

March 27, 2022

Outstanding at beginning of year

3 unchanged sentences

Restricted Stock Units:

For the three and six months ended December 25, 2022, the Company had stock-based compensation expense of $ 82 thousand and $ 165 thousand,

For the three and nine months ended March 26, 2023, the Company had stock-based compensation expense of $ 82 thousand and $ 248 thousand,

respectively, related to RSUs.

For the three and six months ended December 26, 2021, the Company had stock-based compensation expense of $ 42

For the three and nine months ended March 27, 2022, the Company had stock-based compensation expense of $ 42

thousand and $ 127 thousand, respectively, related to RSUs.

As of December 25, 2022, there was $ 412 thousand unamortized stock-based compensation expense related to RSUs.

A summary of the status of restricted stock units as of December 25, 2022, and changes during the six months then ended is presented

As of March 26, 2023, there was $ 330 thousand unamortized stock-based compensation expense related to RSUs.

A summary of the status of restricted stock units as of March 26, 2023, and changes during the nine months then ended is presented below:

Unvested at June 26 ,

Unvested at December 25 ,

Unvested at March 26 ,

Note F - Earnings per Share (EPS)

2 unchanged sentences

Three Months Ended

Six Months Ended

Nine Months Ended

March 26, 2023

March 27, 2022

March 26, 2023

March 27, 2022

Net income available to common stockholders

6 unchanged sentences

Net income per common share

For the three and six months ended December 25, 2022, exercisable options to purchase

111,750 shares of common stock at exercise prices from $ 3.95 to $ 13.11 were

excluded from the computation of diluted EPS because they had an intrinsic value of zero .

For the three and six months ended December 26, 2021, exercisable options to purchase 166,750 shares of common stock at exercise prices ranging from $ 3.11 to $ 13.11 were excluded from the computation of diluted EPS because they had

an intrinsic value of zero .

For the three and nine months ended March 26, 2023, exercisable options to purchase 111,750 shares of common stock at exercise prices from $ 3.95

to $ 13.11 were excluded from the computation of diluted EPS because they had an intrinsic value of zero .

For the three and nine months ended March 27, 2022, exercisable options to purchase 166,750 shares of common stock at exercise prices ranging from $ 3.11

to $ 13.11 were excluded from the computation of diluted EPS because they had an intrinsic value of zero .

Note G - Income Taxes

three and six months ended December 25, 2022, the Company recorded an income tax expense of $ 140 thousand and $ 232 thousand, respectively.

For the three and six months ended December 26, 2021, the Company recorded an income tax expense of $ 4 thousand and $ 7 thousand,

respectively.

For the three months ended December 25, 2022, the federal and state tax expense were $ 100 thousand and $ 40 thousand, respectively.

For the six months ended December 25, 2022, the federal and state tax expense were $ 182 thousand and $ 50

three and nine months ended March 26, 2023, the Company recorded an income tax expense of $ 115 thousand and $ 347 thousand, respectively.

For the three and nine months ended March 27, 2022, the Company recorded an income tax expense of $ 3 thousand and $ 10

thousand, respectively.

For the three months ended March 26, 2023, the federal and state tax expense were $ 91 thousand and

$ 24 thousand, respectively.

For the nine months ended March 26, 2023, the federal and state tax expense were $ 272 thousand and $ 75

thousand, respectively.

The Company continually reviews the realizability of its deferred tax assets, including an analysis of factors such as future taxable

18 unchanged sentences

include equipment, furniture and fixtures for the Company-owned restaurants.

As of December 25, 2022, the Company did not operate any Company-owned restaurants.

As of March 26, 2023, the Company did not operate any Company-owned restaurants.

Corporate administration and other assets primarily include cash and short-term investments, as well as furniture and fixtures located

2 unchanged sentences

Summarized in the following tables are net sales and operating revenues, depreciation and amortization expense, income from continuing

operations before taxes, capital expenditures and assets for the Company’s reportable segments as of the three and six months ended December 25, 2022 and December 26, 2021 (in thousands):

operations before taxes, capital expenditures and assets for the Company’s reportable segments as of the three and nine months ended March 26, 2023 and March 27, 2022 (in thousands):

Three Months Ended

Six Months Ended

Nine Months Ended

March 26, 2023

March 27, 2022

March 26, 2023

March 27, 2022

Net sales and operating revenues:

18 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements