Annual report pursuant to Section 13 and 15(d)

Acquisition of Franchised Restaurants

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Acquisition of Franchised Restaurants
 12 Months Ended
Dec. 31, 2023
Business Combination and Asset Acquisition [Abstract]  
Acquisitions of Franchised Restaurants
16. Acquisition of Franchised Restaurants
On April 17, 2023, the Company acquired certain assets and liabilities of five restaurants from one of its U.S. franchisees for cash consideration of $3.5 million. The pro forma impact of this acquisition and the operating results of the acquired restaurants are not presented as the impact was not material to reported results.
The acquisition was accounted for using the purchase method as defined in ASC 805, Business Combinations. The goodwill arising from the acquisition consists largely of the benefit of the assembled workforce of the acquired restaurants. The goodwill generated by the acquisition is not amortizable for book purposes but is amortizable and deductible for tax purposes. The Company allocated the purchase price to the fair value of the assets acquired and liabilities assumed as follows (in thousands):
Fair Value at Acquisition Date
Property and equipment, net $ 2,637 
Operating lease assets 7,400 
Operating lease liabilities (8,250)
Operating lease assets, net (850)
Other assets, net of liabilities(1)
299 
Intangible assets, net 1,443 
Total purchase price $ 3,529 
(1)    Includes inventory, prepaid assets, till cash, and gift card and loyalty liabilities.
The fair value measurement of tangible and intangible assets and liabilities as of the acquisition date is based on significant inputs not observed in the market and thus represents a level 3 fair value measurement.