SHAKE SHACK INC., 10-K filed on 3/13/2017
Annual Report
Document and Entity Information Document (USD $)
12 Months Ended
Dec. 28, 2016
Jun. 29, 2016
Mar. 1, 2017
Class A Common Stock
Mar. 1, 2017
Class B Common Stock
Document Information [Line Items]
 
 
 
 
Document type
10-K 
 
 
 
Amendment flag
false 
 
 
 
Document period end date
Dec. 28, 2016 
 
 
 
Document fiscal year focus
2016 
 
 
 
Document fiscal period focus
Q4 
 
 
 
Entity registrant name
Shake Shack Inc. 
 
 
 
Entity central index key
0001620533 
 
 
 
Current fiscal year end date
--12-28 
 
 
 
Entity filer category
Accelerated Filer 
 
 
 
Entity current reporting status
Yes 
 
 
 
Entity common stock, shares outstanding
 
 
25,470,089 
10,937,592 
Entity Public Float
 
$ 647,570,019 
 
 
Entity Well-known Seasoned Issuer
No 
 
 
 
Entity Voluntary Filers
No 
 
 
 
CONSOLIDATED BALANCE SHEETS (USD $)
In Thousands, unless otherwise specified
Dec. 28, 2016
Dec. 30, 2015
Current assets:
 
 
Cash and cash equivalents
$ 11,607 
$ 70,849 
Marketable Securities, Current
62,040 
275 
Accounts receivable
6,006 
4,217 
Inventories
806 
543 
Prepaid expenses and other current assets
3,485 
3,050 
Total current assets
83,944 
78,934 
Property and equipment, net
136,264 
93,041 
Deferred income taxes, net
313,207 
201,957 
Other assets
4,779 
5,615 
TOTAL ASSETS
538,194 
379,547 
Current liabilities:
 
 
Accounts payable
6,921 
6,786 
Accrued expenses
8,538 
6,801 
Accrued wages and related liabilities
6,084 
5,804 
Other current liabilities
10,173 
4,614 
Total current liabilities
31,716 
24,005 
Note payable
0 
313 
Deemed Landlord Financing Liability
2,007 
0 
Deferred rent
31,107 
22,927 
Liabilities under tax receivable agreement, net of current portion
267,902 
170,933 
Other long-term liabilities
4,109 
4,350 
Total liabilities
336,841 
222,528 
Commitments and contingencies
   
   
Stockholders' equity:
 
 
Preferred stock, no par value—10,000,000 shares authorized; none issued and outstanding as of December 28, 2016 and December 30, 2015, respectively.
0 
0 
Additional paid-in capital
135,448 
96,311 
Retained earnings
16,719 
4,273 
Accumulated other comprehensive loss
(15)
(5)
Total stockholders' equity attributable to Shake Shack Inc. / members' equity
152,188 
100,615 
Non-controlling interests
49,165 
56,404 
Total equity
201,353 
157,019 
TOTAL LIABILITIES AND STOCKHOLDERS'
538,194 
379,547 
Class A Common Stock
 
 
Stockholders' equity:
 
 
Common stock
25 
20 
Class B Common Stock
 
 
Stockholders' equity:
 
 
Common stock
$ 11 
$ 16 
CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $)
Dec. 28, 2016
Dec. 30, 2015
Feb. 4, 2015
Preferred stock, par value (in dollars per share)
$ 0.000 
$ 0.000 
 
Preferred stock, shares authorized
10,000,000 
10,000,000 
10,000,000 
Preferred stock, shares issued
0 
0 
 
Preferred stock, shares outstanding
0 
0 
 
Common stock par value (in dollars per share)
 
   
 
Common stock, shares authorized
 
   
 
Common stock, shares, issued
 
   
 
Common stock, shares, outstanding
 
   
 
Class A Common Stock
 
 
 
Common stock par value (in dollars per share)
$ 0.001 
$ 0.001 
$ 0.001 
Common stock, shares authorized
200,000,000 
200,000,000 
200,000,000 
Common stock, shares, issued
25,151,384 
19,789,259 
 
Common stock, shares, outstanding
25,151,384 
19,789,259 
 
Class B Common Stock
 
 
 
Common stock par value (in dollars per share)
$ 0.001 
$ 0 
$ 0.001 
Common stock, shares authorized
35,000,000 
35,000,000 
35,000,000 
Common stock, shares, issued
11,253,592 
16,460,741 
 
Common stock, shares, outstanding
11,253,592 
16,460,741 
 
CONSOLIDATED STATEMENT OF INCOME (LOSS) (USD $)
In Thousands, except Per Share data, unless otherwise specified
12 Months Ended
Dec. 28, 2016
Dec. 30, 2015
Dec. 31, 2014
Shack sales
$ 259,350 
$ 183,219 
$ 112,042 
Licensing revenue
9,125 
7,373 
6,488 
TOTAL REVENUE
268,475 
190,592 
118,530 
Shack-level operating expenses:
 
 
 
Food and paper costs
73,752 
54,079 
34,925 
Labor and related expenses
65,540 
44,752 
29,312 
Other operating expenses
24,946 
16,307 
11,191 
Occupancy and related expenses
21,820 
15,207 
9,753 
General and administrative expenses
30,556 
37,825 
18,187 
Depreciation expense
14,502 
10,222 
5,809 
Pre-opening costs
9,520 
5,430 
6,105 
Loss on disposal of property and equipment
34 
17 
105 
TOTAL EXPENSES
240,670 
183,839 
115,387 
OPERATING INCOME
27,805 
6,753 
3,143 
Nonoperating Income (Expense)
1,065 
7 
2 
Interest Expense
374 
332 
365 
INCOME BEFORE INCOME TAXES
28,496 
6,428 
2,780 
Income tax expense
6,350 
3,304 
662 
NET INCOME
22,146 
3,124 
2,118 
Less: net income attributable to non-controlling interests
9,700 
11,900 
0 
NET INCOME (LOSS) ATTRIBUTABLE TO SHAKE SHACK INC.
$ 12,446 
$ (8,776)
$ 2,118 
Earnings (loss) per share of Class A common stock
 
 
 
Basic (in dollars per share)
$ 0.54 1
$ (0.65)1
$ 0.07 1
Diluted (in dollars per share)
$ 0.53 1
$ (0.65)1
$ 0.07 1
Weighted-average shares of Class A common stock outstanding
 
 
 
Basic (shares)
22,956 1
13,588 1
29,977 1
Diluted (shares)
23,449 1
13,588 1
30,122 1
CONSOLIDATED STATEMENT OF INCOME (LOSS) - PARENTHETICAL (USD $)
0 Months Ended
Feb. 4, 2015
IPO
Class A Common Stock
Common stock
Shares issued during the period
5,750,000 
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (USD $)
12 Months Ended
Dec. 28, 2016
Dec. 30, 2015
Dec. 31, 2014
Statement of Comprehensive Income [Abstract]
 
 
 
Net income
$ 22,146,000 
$ 3,124,000 
$ 2,118,000 
Unrealized holding losses on available-for-sale securities
(35,000)1
(11,000)1
0 1
Other Comprehensive Income (Loss), Reclassification Adjustment from AOCI for Sale of Securities, Net of Tax
19,000 1
0 1
0 1
OTHER COMPREHENSIVE LOSS, NET OF TAX
(16,000)1
(11,000)1
0 1
COMPREHENSIVE INCOME
22,130,000 
3,113,000 
2,118,000 
Comprehensive Income (Loss), Net of Tax, Attributable to Noncontrolling Interest
9,694,000 
11,894,000 
0 
COMPREHENSIVE INCOME ATTRIBUTABLE TO SHAKE SHACK INC.
12,436,000 
(8,781,000)
2,118,000 
Other comprehensive loss
 
 
 
Income tax benefit
$ 0 
$ 0 
$ 0 
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' AND MEMBERS' EQUITY (USD $)
In Thousands, except Share data, unless otherwise specified
Total
USD ($)
Class A Common Stock
Class B Common Stock
Members' Equity
USD ($)
Common stock
Class A Common Stock
USD ($)
Common stock
Class B Common Stock
USD ($)
Additional Paid-In Capital
USD ($)
Retained Earnings
USD ($)
Accumulated Other Comprehensive Loss
USD ($)
Non- Controlling Interest
USD ($)
Secondary Offering and Redemption of Units
USD ($)
Secondary Offering and Redemption of Units
Common stock
Class A Common Stock
USD ($)
Secondary Offering and Redemption of Units
Common stock
Class B Common Stock
USD ($)
Secondary Offering and Redemption of Units
Additional Paid-In Capital
USD ($)
Secondary Offering and Redemption of Units
Non- Controlling Interest
USD ($)
USC Merger
USD ($)
USC Merger
Common stock
Class A Common Stock
USD ($)
USC Merger
Common stock
Class B Common Stock
USD ($)
USC Merger
Additional Paid-In Capital
USD ($)
USC Merger
Non- Controlling Interest
USD ($)
Beginning balance at Dec. 25, 2013
$ 37,387 
 
 
$ 37,387 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Increase (Decrease) in Stockholders' Equity [Roll Forward]
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income
2,118 
 
 
2,118 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equity-based compensation
165 
 
 
165 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Member distributions
(27,070)
 
 
(27,070)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Other comprehensive loss
0 1
 
 
 
 
 
 
 
0 
 
 
 
 
 
 
 
 
 
 
 
Ending balance at Dec. 31, 2014
12,600 
 
 
12,600 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Increase (Decrease) in Stockholders' Equity [Roll Forward]
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income
(13,049)
 
 
(13,049)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equity-based compensation
7,731 
 
 
7,731 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Member distributions
(11,125)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Ending balance at Feb. 03, 2015
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Beginning balance at Dec. 31, 2014
12,600 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Increase (Decrease) in Stockholders' Equity [Roll Forward]
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income
3,124 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Other comprehensive loss
(11)1
 
 
 
 
 
 
 
(5)
 
 
 
 
 
 
 
 
 
 
 
Ending balance at Dec. 30, 2015
157,019 
 
 
 
 
 
 
 
(5)
 
 
 
 
 
 
 
 
 
 
 
Ending balance (shares) at Dec. 30, 2015
   
19,789,259 
16,460,741 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Beginning balance at Feb. 03, 2015
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Increase (Decrease) in Stockholders' Equity [Roll Forward]
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income
16,173 
 
 
 
 
 
 
4,273 
 
11,900 
 
 
 
 
 
 
 
 
 
 
Shares issued during the period
 
 
 
 
5,750,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Class A common stock issued in connection with the USC Merger
109,262 
 
 
 
6 
 
109,256 
 
 
 
 
 
 
 
 
 
 
 
 
 
Issuance of class A common stock in settlement of unit appreciation rights (shares)
 
 
 
 
339,306 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Issuance of Class A common stock in settlement of unit appreciation rights
0 
 
 
 
 
 
987 
 
 
(987)
 
 
 
 
 
 
 
 
 
 
Effect of organizational transactions (shares)
 
 
 
 
5,968,841 
24,191,853 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Effect of the Organizational Transactions
30 
 
 
3,843 
6 
24 
(75,182)
 
 
71,339 
 
 
 
 
 
 
 
 
 
 
Equity-based compensation
4,314 
 
 
 
 
 
4,314 
 
 
 
 
 
 
 
 
 
 
 
 
 
Establishment of liabilities under tax receivable agreement and related changes to deferred tax assets associated with increases in tax basis
31,094 
 
 
 
 
 
31,094 
 
 
 
 
 
 
 
 
 
 
 
 
 
Redemptions (shares)
 
 
 
 
 
 
 
 
 
 
 
6,003,308 
(6,003,308)
 
 
 
1,727,804 
(1,727,804)
 
 
Redemption of LLC Interests in connection with the secondary offering
 
 
 
 
 
 
 
 
 
 
0 
6 
(6)
19,934 
(19,934)
0 
2 
(2)
5,908 
(5,908)
Other comprehensive loss
(11)
 
 
 
 
 
 
 
(5)
(6)
 
 
 
 
 
 
 
 
 
 
Ending balance at Dec. 30, 2015
157,019 
 
 
0 
20 
16 
96,311 
4,273 
(5)
56,404 
 
 
 
 
 
 
 
 
 
 
Ending balance (shares) at Dec. 30, 2015
   
19,789,259 
16,460,741 
 
19,789,259 
16,460,741 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Beginning balance at Aug. 31, 2015
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Increase (Decrease) in Stockholders' Equity [Roll Forward]
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Redemptions (shares)
 
 
 
 
2,848,035 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Effect of redemption (shares)
 
 
 
 
 
2,848,035 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Ending balance at Dec. 30, 2015
 
 
 
 
20 
16 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Ending balance (shares) at Dec. 30, 2015
 
19,789,259 
16,460,741 
 
19,789,259 
16,460,741 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Beginning balance at Nov. 30, 2015
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Increase (Decrease) in Stockholders' Equity [Roll Forward]
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Shares issued during the period
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
1,727,804 
 
 
 
Issuance of class A common stock in settlement of unit appreciation rights (shares)
 
 
 
 
1,727,804 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Effect of redemption (shares)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
1,727,804 
 
 
Ending balance at Dec. 30, 2015
157,019 
 
 
 
20 
16 
96,311 
4,273 
(5)
56,404 
 
 
 
 
 
 
 
 
 
 
Ending balance (shares) at Dec. 30, 2015
   
19,789,259 
16,460,741 
 
19,789,259 
16,460,741 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period
 
 
 
 
154,976 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Stock Issued During Period, Value, Stock Options Exercised
0 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Adjustments to Additional Paid in Capital, Share-based Compensation, Requisite Service Period Recognition
 
 
 
 
 
 
795 
 
 
 
 
 
 
 
 
 
 
 
 
 
Stock Issued During Period, Value, Share-based Compensation, Gross
3,197 
 
 
 
 
 
 
 
 
 
 
 
 
 
2,402 
 
 
 
 
 
Adjustment to Additional Paid in Capital, Income Tax Effect from Share-based Compensation, Net
33 
 
 
 
 
 
30 
 
 
 
 
 
 
 
3 
 
 
 
 
 
Increase (Decrease) in Stockholders' Equity [Roll Forward]
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income
22,146 
 
 
 
 
 
 
12,446 
 
9,700 
 
 
 
 
 
 
 
 
 
 
Issuance of class A common stock in settlement of unit appreciation rights (shares)
 
 
 
 
339,306 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equity-based compensation
5,493 
 
 
 
 
 
5,493 
 
 
 
 
 
 
 
 
 
 
 
 
 
Establishment of liabilities under tax receivable agreement and related changes to deferred tax assets associated with increases in tax basis
15,833 
 
 
 
 
 
15,833 
 
 
 
 
 
 
 
 
 
 
 
 
 
Redemptions (shares)
 
 
 
 
5,207,149 
 
 
 
 
 
 
5,207,149 
(5,207,149)
 
 
 
 
 
 
 
Redemption of LLC Interests in connection with the secondary offering
 
 
 
 
 
 
 
 
 
 
0 
5 
(5)
16,986 
(16,986)
 
 
 
 
 
Effect of redemption (shares)
 
 
 
 
 
5,207,149 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Other comprehensive loss
(16)1
 
 
 
 
 
 
 
(10)
(6)
 
 
 
 
 
 
 
 
 
 
Noncontrolling Interest, Decrease from Distributions to Noncontrolling Interest Holders
 
 
 
 
 
 
 
 
 
(2,352)
 
 
 
 
 
 
 
 
 
 
Ending balance at Dec. 28, 2016
$ 201,353 
 
 
$ 0 
$ 25 
$ 11 
$ 135,448 
$ 16,719 
$ (15)
$ 49,165 
 
 
 
 
 
 
 
 
 
 
Ending balance (shares) at Dec. 28, 2016
 
25,151,384 
11,253,592 
 
25,151,384 
11,253,592 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $)
In Thousands, unless otherwise specified
12 Months Ended
Dec. 28, 2016
Dec. 30, 2015
Dec. 31, 2014
OPERATING ACTIVITIES
 
 
 
Net income (including amounts attributable to non-controlling interests)
$ 22,146 
$ 3,124 
$ 2,118 
Adjustments to reconcile net income to net cash provided by operating activities:
 
 
 
Depreciation expense
14,502 
10,222 
5,809 
Equity-based compensation
5,354 
16,681 
165 
Non-cash interest expense
304 
273 
192 
Excess Tax Benefit from Share-based Compensation, Operating Activities
(33)
0 
0 
Marketable Securities, Realized Gain (Loss), Excluding Other than Temporary Impairments
18 
0 
0 
Loss on disposal of property and equipment
34 
17 
105 
Deferred income taxes
(523)
(734)
(93)
Other Noncash Income (Expense)
(688)
0 
0 
Changes in operating assets and liabilities:
 
 
 
Accounts receivable
2,974 
775 
(1,751)
Inventories
(263)
(14)
(198)
Prepaid expenses and other current assets
(756)
(958)
(1,168)
Other assets
(822)
1,293 
(2,461)
Accounts payable
839 
201 
1,210 
Accrued expenses
5,560 
2,548 
3,349 
Accrued wages and related liabilities
280 
3,394 
416 
Other current liabilities
2,130 
257 
420 
Deferred rent
3,415 
4,363 
5,206 
Other long-term liabilities
(186)
(184)
265 
NET CASH PROVIDED BY OPERATING ACTIVITIES
54,285 
41,258 
13,584 
INVESTING ACTIVITIES
 
 
 
Purchases of marketable securities
(61,266)
(2,397)
0 
Proceeds from Sale and Maturity of Marketable Securities
938 
0 
0 
Purchases of property and equipment
(54,433)
(32,117)
(28,515)
NET CASH USED IN INVESTING ACTIVITIES
(114,761)
(34,514)
(28,515)
FINANCING ACTIVITIES
 
 
 
Payments on promissory note
(313)
0 
0 
Proceeds from Revolving Credit Facility
0 
4,000 
32,000 
Payments on Revolving Credit Facility
0 
(36,000)
0 
Proceeds from Deemed Landlord Financing
65 
0 
0 
Deferred financing costs
0 
(103)
(398)
Proceeds from issuance of Class A common stock sold in initial public offering, net of underwriting discounts, commissions and offering costs
0 
109,262 
0 
Proceeds from issuance of Class B common stock
0 
30 
0 
Payments to Noncontrolling Interests
(1,745)
0 
0 
Distributions paid to members prior to the initial public offering
0 
(11,125)
(27,070)
Proceeds from Stock Options Exercised
3,194 
0 
0 
Employee withholding taxes related to net settled equity awards
0 
(4,636)
0 
Excess Tax Benefit from Share-based Compensation, Financing Activities
33 
0 
0 
NET CASH PROVIDED BY FINANCING ACTIVITIES
1,234 
61,428 
4,532 
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
(59,242)
68,172 
(10,399)
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD
70,849 
 
2,677 
CASH AND CASH EQUIVALENTS AT END OF PERIOD
$ 11,607 
$ 70,849 
 
NATURE OF OPERATIONS
NATURE OF OPERATIONS
NATURE OF OPERATIONS
 
Shake Shack Inc. was formed on September 23, 2014 as a Delaware corporation for the purpose of facilitating an initial public offering and other related transactions in order to carry on the business of SSE Holdings, LLC and its subsidiaries. Unless the context otherwise requires, references to "we," "us," "our," "Shake Shack" and the "Company" refer to Shake Shack Inc. and its subsidiaries, including SSE Holdings, LLC, which we refer to as "SSE Holdings."
We operate and license Shake Shack restaurants ("Shacks"), which serve hamburgers, hot dogs, chicken, crinkle cut fries, shakes, frozen custard, beer, wine and more. As of December 28, 2016, there were 114 Shacks in operation, system-wide, of which 64 were domestic company-operated Shacks, seven were domestic licensed Shacks and 43 were international licensed Shacks.
Initial Public Offering
On February 4, 2015, we completed an initial public offering ("IPO") of 5,750,000 shares of our Class A common stock at a public offering price of $21.00 per share, which includes 750,000 shares issued pursuant to the underwriters' over-allotment option. We received $112,298 in proceeds, net of underwriting discounts and commissions, which we used to purchase newly-issued membership interests from SSE Holdings at a price per interest equal to the initial public offering price of our Class A common stock.
Organizational Transactions
In connection with the IPO, we completed the following transactions (the "Organizational Transactions"):
▪
We amended and restated the limited liability company agreement of SSE Holdings (as amended, the "SSE Holdings LLC Agreement") to, among other things, (i) provide for a new single class of common membership interests in SSE Holdings ("LLC Interests"), (ii) exchange all of the membership interests of the then-existing holders of SSE Holdings for LLC Interests and (iii) appoint Shake Shack Inc. as the sole managing member of SSE Holdings. See Note 11.
▪
We amended and restated our certificate of incorporation to, among other things, (i) provide for Class B common stock with voting rights but no economic interests (where "economic interests" means the right to receive any distributions or dividends, whether cash or stock, in connection with common stock) and (ii) issue shares of Class B common stock to the then-existing holders of SSE Holdings on a one-to-one basis with the number of LLC Interests they own. See Note 11.
▪
We acquired, by merger, two entities that were owned by former indirect members of SSE Holdings, for which we issued 5,968,841 shares of Class A common stock as merger consideration (the "Mergers"). The only assets held by the two merged entities prior to the merger were 5,968,841 LLC Interests and a corresponding number of shares of Class B common stock. Upon consummation of the Mergers, we canceled the 5,968,841 shares of Class B common stock and recognized the 5,968,841 of LLC Interests at carrying value, as the Mergers are considered to be transactions between entities under common control.
Following the completion of the Organizational Transactions, we owned 33.3% of SSE Holdings. The non-controlling interest holders subsequent to the Merger owned the remaining 66.7% of SSE Holdings. As a result of the Organizational Transactions, we became the sole managing member of SSE Holdings and, although we had a minority economic interest in SSE Holdings, we had the sole voting power in, and control the management of, SSE Holdings. Accordingly, we consolidated the financial results of SSE Holdings and reported a non-controlling interest in our consolidated financial statements.
As the Organizational Transactions are considered transactions between entities under common control, the financial statements for periods prior to the IPO and Organizational Transactions have been adjusted to combine the previously separate entities for presentation purposes.
Secondary Offering
In August 2015, we completed a secondary offering of 4,000,000 shares of our Class A common stock at a price of $60.00 per share. All of the shares sold in the offering were offered by certain non-controlling interest holders. We did not receive any proceeds from the sale of shares of Class A common stock offered by the aforementioned non-controlling interest holders. The shares sold in the offering consisted of (i) 844,727 existing shares of Class A common stock held and (ii) 3,155,273 newly-issued shares of Class A common stock issued in connection with the redemption of 3,155,273 LLC Interests by the non-controlling interest holders that participated in the offering. Simultaneously, and in connection with the redemption, 3,155,273 shares of Class B common stock were surrendered by non-controlling interest holders and canceled. Additionally, in connection with the redemption, we received 3,155,273 LLC Interests, increasing our total ownership interest in SSE Holdings.
USC Merger
Pursuant to a Stockholders Agreement, dated as of February 4, 2015, as amended, by and among Daniel H. Meyer and his affiliates (the "Meyer Group") and other parties thereto, the Meyer Group has the right to cause all of the stock of Union Square Cafe Corp. ("USC") and Gramercy Tavern Corp. ("GT") to be converted into and exchanged for shares of our Class A common stock pursuant to a tax-free reorganization (each, a "Reorganization"). In December 2015, the Meyer Group exercised their right with respect to USC. The Reorganization was structured as a two-step merger, whereby (i) a newly-formed wholly-owned subsidiary of the Company merged with and into USC, then (ii) USC merged with and into the Company (the foregoing transactions are collectively referred to as the "USC Merger"). Prior to the USC Merger, USC owned 1,727,804 LLC Interests and an equivalent number of shares of our Class B common stock. In the USC Merger, (i) 1,727,804 shares of Class A common stock were issued to the stockholders of USC, with each stockholder receiving newly-issued shares of Class A common stock in an amount equivalent to the number of shares of USC held by such stockholders; (ii) 1,727,804 shares of Class B common stock held by USC were cancelled; and (iii) 1,727,804 LLC Interests held by USC were transferred to us.
As of December 28, 2016, we owned 69.1% of SSE Holdings and the non-controlling interest holders own the remaining 30.9% of SSE Holdings.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
 
Basis of Presentation
The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and include our accounts and the accounts of our subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. Certain reclassifications have been made to prior period amounts to conform to the current year presentation.
Pursuant to the provisions of Accounting Standards Update No. 2015-02, Amendments to the Consolidation Analysis ("ASU 2015-02"), adopted on December 31, 2015, SSE Holdings is now considered a VIE. Prior to the adoption of ASU 2015-02, we consolidated SSE Holdings as a voting interest entity. Shake Shack Inc. is the primary beneficiary as we have the majority economic interest in SSE Holdings and, as the sole managing member, have decision making authority that significantly affects the economic performance of the entity, while the limited partners have no substantive kick-out or participating rights. As a result, we will continue to consolidate SSE Holdings. The assets and liabilities of SSE Holdings represent substantially all of our consolidated assets and liabilities with the exception of certain deferred taxes and liabilities under the Tax Receivable Agreement. As of December 28, 2016 and December 30, 2015, the net assets of SSE Holdings were $158,845 and $124,214, respectively. The assets of SSE Holdings are subject to certain restrictions in SSE Holdings' revolving credit agreements. See Note 8 for more information.
Fiscal Year
We operate on a 52/53 week fiscal year ending on the last Wednesday in December. Fiscal year 2016 contained 52 weeks and ended on December 28, 2016. Fiscal year 2015 contained 52 weeks and ended on December 30, 2015. Fiscal year 2014 contained 53 weeks and ended on December 31, 2014. Unless otherwise stated, references to years in this report relate to fiscal years.
Use of Estimates
The preparation of these consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of sales and expenses during the reporting period. Actual results could differ from those estimates.
Segment Reporting
We own and operate Shacks in the United States. We also have domestic and international licensed operations. Our chief operating decision maker (the "CODM") is our Chief Executive Officer. As the CODM reviews financial performance and allocates resources at a consolidated level on a recurring basis, we have one operating segment and one reportable segment.
Fair Value Measurements
We apply fair value accounting for all financial assets and liabilities and non-financial assets and liabilities that are recognized or disclosed at fair value in the financial statements on a recurring basis. Fair value is defined as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurements for assets and liabilities that are required to be recorded at fair value, we assume the highest and best use of the asset by market participants in which we would transact and the market-based risk measurements or assumptions that market participants would use in pricing the asset or liability, such as inherent risk, transfer restrictions, and credit risk.
Assets and liabilities are classified using a fair value hierarchy, which prioritizes the inputs used to measure fair value into three levels, and bases the categorization within the hierarchy upon the lowest level of input that is available and significant to the fair value measurement:
▪
Level 1 - Quoted prices in active markets for identical assets or liabilities
▪
Level 2 - Observable inputs other than quoted prices in active markets for identical assets or liabilities, quoted prices for identical assets or liabilities in inactive markets, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities
▪
Level 3 - Inputs that are both unobservable and significant to the overall fair value measurements reflecting an entity's estimates of assumptions that market participants would use in pricing the asset or liability
Cash and Cash Equivalents
Cash and cash equivalents consist primarily of cash on hand, deposits with banks, and short-term, highly liquid investments that have original maturities of three months or less. Cash equivalents are stated at cost, which approximates fair value. Cash equivalents consist primarily of money market funds.
Accounts Receivable
Accounts receivable consist primarily of receivables from landlords for tenant improvement allowances, receivables from our licensees for licensing revenue and related reimbursements, credit card receivables and vendor rebates. We evaluate the collectibility of our accounts receivable based on a variety of factors, including historical experience, current economic conditions and other factors.
Inventories
Inventories, which consist of food, beer, wine, other beverages and retail merchandise, are stated at the lower of cost or market with cost determined on a first-in, first-out basis. No adjustment is deemed necessary to reduce inventory to the lower of cost or market value due to the rapid turnover and high utilization of inventory.
Property and Equipment
Property and equipment is stated at historical cost less accumulated depreciation. Property and equipment is depreciated based on the straight-line method over the estimated useful lives of the assets, generally ranging from three to seven years for equipment, furniture and fixtures, and computer equipment and software. Leasehold improvements are depreciated over the shorter of their estimated useful life or the related lease life, generally ranging from 10 to 20 years. For leases with renewal periods at our option, we use the original lease term, excluding renewal option periods, to determine estimated useful lives.
Costs incurred when constructing Shacks are capitalized. The cost of repairs and maintenance are expensed when incurred. Costs for refurbishments and improvements that significantly increase the productive capacity or extend the useful life of the asset are capitalized. When assets are disposed of, the resulting gain or loss is recognized on the Consolidated Statements of Income (Loss).
We assess potential impairments to our long-lived assets, which includes property and equipment, whenever events or circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of an asset is measured by a comparison of the carrying amount of an asset group to its estimated undiscounted future cash flows expected to be generated by the asset. If the carrying amount of the asset group exceeds its estimated undiscounted future cash flows, an impairment charge is recognized as the amount by which the carrying amount of the asset exceeds the fair value of the asset. There were no impairment charges recorded in fiscal 2016, 2015 and 2014.
Deferred Financing Costs
Deferred financing costs incurred in connection with the issuance of long-term debt and establishing credit facilities are capitalized and amortized to interest expense based on the related debt agreements. Deferred financing costs are included in other assets on the Consolidated Balance Sheets.
Other Assets
Other assets consist primarily of long-term marketable securities, security deposits, transferable liquor licenses and certain custom furniture pre-ordered for future Shacks and yet to be placed in service.
The costs of obtaining non-transferable liquor licenses that are directly issued by local government agencies for nominal fees are expensed as incurred. The costs of purchasing transferable liquor licenses through open markets in jurisdictions with a limited number of authorized liquor licenses are capitalized as indefinite-lived intangible assets. Annual liquor license renewal fees are expensed over the renewal term. As of December 28, 2016 and December 30, 2015, indefinite-lived intangible assets relating to transferable liquor licenses totaled $701. We evaluate our indefinite-lived intangible assets for impairment annually during our fiscal fourth quarter, and whenever events or changes in circumstances indicate that an impairment may exist. When evaluating other intangible assets for impairment, we may first perform a qualitative assessment to determine whether it is more likely than not that an intangible asset group is impaired. If we do not perform the qualitative assessment, or if we determine that it is not more likely than not that the fair value of the intangible asset group exceeds its carrying amount, we calculate the estimated fair value of the intangible asset group. If the carrying amount of the intangible asset group exceeds the estimated fair value, an impairment charge is recorded to reduce the carrying value to the estimated fair value. In addition, we continuously monitor and may revise our intangible asset useful lives if and when facts and circumstances change.
Equity-based Compensation
Equity-based compensation expense is measured based on fair value. For awards with graded-vesting features and service conditions only, compensation expense is recognized on a straight-line basis over the total requisite service period for the entire award. For awards with graded-vesting features and a combination of service and performance conditions, compensation expense is recognized using a graded-vesting attribution method over the vesting period based on the most probable outcome of the performance conditions. Equity-based compensation expense is included within general and administrative expenses and labor and related expenses on the Consolidated Statements of Income (Loss).
Leases
We lease all of our domestic company-operated Shacks, our home office and certain equipment under various non-cancelable lease agreements that expire on various dates through 2034. Generally, our real estate leases have initial terms ranging from 10 to 20 years and typically include two five-year renewal options. At the inception of each lease, we determine its classification as an operating or capital lease. Most of our leases are classified as operating leases and typically provide for fixed minimum rent payments and/or contingent rent payments based upon sales in excess of specified thresholds. When the achievement of such sales thresholds are deemed to be probable, contingent rent is accrued in proportion to the sales recognized during the period. For operating leases that include rent holidays and rent escalation clauses, we recognize rent expense on a straight-line basis over the lease term from the date we take possession of the leased property. The difference between the straight-line rent amounts and amounts payable under the lease agreements is recorded as deferred rent and is included as rent expense in occupancy and related expenses on the Consolidated Statements of Income (Loss). Rent expense incurred before a Shack opens is recorded in pre-opening costs. Once a domestic company-operated Shack opens, we record the straight-line rent expense and any contingent rent, if applicable, in occupancy and related expenses on the Consolidated Statements of Income (Loss).
Many of our leases also require us to pay real estate taxes, common area maintenance costs and other occupancy costs which are included in occupancy and related expenses on the Consolidated Statements of Income (Loss).
We expend cash for leasehold improvements to build out and equip our leased premises. Generally, a portion of the leasehold improvements and building costs are reimbursed by our landlords as landlord incentives pursuant to agreed-upon terms in our lease agreements. If obtained, landlord incentives usually take the form of up-front cash, full or partial credits against our future minimum or contingent rents otherwise payable by us, or a combination thereof. When contractually due, we classify landlord incentives as deferred rent on the Consolidated Balance Sheets and amortize the landlord incentives on a straight-line basis over the lease term as a reduction of occupancy costs and related expenses or pre-opening costs on the Consolidated Statements of Income (Loss).
Lease Financing Arrangements
In certain leasing arrangements, due to our involvement in the construction of the leased assets, we are considered the owner of the leased assets for accounting purposes. In such cases, in addition to capitalizing our own construction costs, we capitalize the construction costs funded by the landlord related to our leased premises, and also recognize a corresponding liability for those costs as deemed landlord financing. If, upon completion of construction, the arrangement does not meet the sales recognition criteria under the sale-leaseback accounting guidance, we would be precluded from de-recognizing the landlord-funded asset and related financing obligation and would continue to account for the landlord-funded asset as if we were the legal owner. If de-recognition is permitted we would be required to account for the lease as either an operating or capital lease.
As of December 28, 2016, we were deemed to be the accounting owner of eight leased Shacks, all of which were under construction as of the end of the period. As of December 30, 2015, we were not deemed the accounting owner of any of our leased Shacks.
Revenue Recognition
Revenue consists of Shack sales and licensing revenue. Revenue from Shack sales are presented net of discounts and recognized when food and beverage products are sold. Sales tax collected from customers is excluded from Shack sales and the obligation is included in sales tax payable until the taxes are remitted to the appropriate taxing authorities. Revenue from our gift cards are deferred and recognized upon redemption. Licensing revenues include initial territory fees and ongoing licensing fees from all licensed Shacks. Initial territory fees are recorded as deferred revenue when received and proportionate amounts are recognized as revenue when a licensed Shack is opened and all material services and conditions related to the fee have been substantially performed. Ongoing licensing fees from these Shacks are based on a percentage of sales and are recognized as revenue as the fees are earned and become receivable from the licensee.
Income Taxes
We account for income taxes pursuant to the asset and liability method which requires the recognition of deferred income tax assets and liabilities related to the expected future tax consequences arising from temporary differences between the carrying amounts and tax bases of assets and liabilities based on enacted statutory tax rates applicable to the periods in which the temporary differences are expected to reverse. Any effects of changes in income tax rates or laws are included in income tax expense in the period of enactment. A valuation allowance is recognized if we determine it is more likely than not that all or a portion of a deferred tax asset will not be recognized.
Pre-Opening Costs
Pre-opening costs are expensed as incurred and consist primarily of legal fees, occupancy, manager and employee wages, travel and related training costs incurred prior to the opening of a Shack.
Advertising
The cost of advertising is expensed as incurred. Advertising costs amounted to $147, $149 and $87 in fiscal 2016, 2015 and 2014, respectively, and are included in general and administrative expense and other operating expenses on the Consolidated Statements of Income (Loss).
Recently Adopted Accounting Pronouncements     
We adopted the Accounting Standards Updates (“ASUs”) summarized below in fiscal 2016. The effects of adoption did not have a material impact on our consolidated financial statements.
Accounting Standards Update (“ASU”)
Description
Date
Adopted
Customers' Accounting for Fees Paid in a Cloud Computing Arrangement
(ASU 2015-05)

This standard provides guidance in evaluating whether a cloud computing arrangement includes a software license. If a cloud computing arrangement includes a software license, then the software license element of the arrangement should be accounted for as an acquisition of a software license. Otherwise, it should be accounted for as a service contract.
December 31, 2015
Simplifying the Presentation of Debt Issuance Costs
(ASU 2015-03, 2015-15)

ASU 2015-03 requires that debt issuance costs related to a recognized liability be presented on the balance sheet as a direct reduction from the carrying amount of that debt liability, consistent with debt discounts. ASU 2015-15 clarifies that for line-of-credit arrangements, the SEC staff would not object to an entity deferring and presenting debt issuance costs as an asset and subsequently amortizing the deferred issuance costs ratably over the term of the line-of-credit arrangement.
December 31, 2015

Recently Issued Accounting Pronouncements       
Accounting Standards Update (“ASU”)
Description
Expected Impact
Effective Date
Statement of Cash Flows: Classification of Certain Cash Receipts and Payments
(ASU 2016-15)

This standard provides guidance on eight specific cash flow issues with the objective of reducing diversity in practice. It should be applied retrospectively to each period presented, subject to certain conditions.
We are currently evaluating the impact this standard will have on our consolidated financial statements.

December 28, 2017

Improvements to Employee Share-Based Payment Accounting
(ASU 2016-09)

This standard simplifies certain aspects of accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, an option to recognize gross stock compensation expense with actual forfeitures recognized as they occur, as well as certain classifications on the statement of cash flows. Adoption methodology allowed varies based on each provision of the standard.

The adoption of this standard is not expected to have a material effect on our consolidated financial statements.

December 29, 2016

Recognition of Breakage for Certain Prepaid Stored-Value Products
(ASU 2016-04)

This standard provides guidance on derecognition of a liability resulting from the sale of certain prepaid store-value products when an entity expects to be entitled to a breakage amount. It should be applied using either a modified retrospective or retrospective transition method.
The adoption of this standard is not expected to have a material effect on our consolidated financial statements.

December 28, 2017

Leases
(ASU 2016-02)

This standard establishes a new lease accounting model, which introduces the recognition of lease assets and liabilities for those leases classified as operating leases under previous GAAP. It should be applied using a modified retrospective approach, with the option to elect various practical expedients. Early adoption is permitted.

We are currently evaluating the impact this standard will have on our consolidated financial statements.
December 27, 2018

Recognition and Measurement of Financial Assets and Financial Liabilities
(ASU 2016-01)
For public business entities, this standard requires: (i) certain equity investments to be measured at fair value with changes in fair value recognized in net income; (ii) a qualitative assessment to identify impairment of equity investments without readily determinable fair values; (iii) elimination of the requirement to disclose the method(s) and significant assumptions used to estimate the fair value for financial instruments measured at amortized cost on the balance sheet; (iv) use of the exit price notion when measuring the fair value of financial instruments for disclosure purposes; (v) separate presentation in other comprehensive income of the portion of the total change in the fair value of a liability resulting from a change in the instrument-specific credit risk when the entity has elected to measure the liability at fair value in accordance with the fair value option for financial instruments; (vi) separate presentation of financial assets and liabilities by measurement category and form of financial asset in the financial statements; and (vii) an entity to evaluate the need for a valuation allowance on a deferred tax asset related to available-for-sale securities in combination with the entity’s other deferred tax assets. The standard should be applied by means of a cumulative-effect adjustment to the balance sheet at the beginning of the fiscal year of adoption. Early adoption is permitted, subject to certain conditions resulting from a change in the instrument-specific credit risk when the entity has elected to measure the liability at fair value.

We are currently evaluating the impact this standard will have on our consolidated financial statements.
December 28, 2017
Accounting Standards Update (“ASU”)
Description
Expected Impact
Effective Date
Simplifying the Measurement of Inventory
(ASU 2015-11)

This standard applies to inventory measured using methods other than last-in, first-out (LIFO) or the retail method, and requires entities to measure such inventory at the lower of cost or net realizable value. It should be applied prospectively.

The adoption of this standard is not expected to have a material effect on our consolidated financial statements.
December 29, 2016

Revenue from Contracts with Customers and related standards
(ASU’s 2014-09, 2015-14, 2016-08, 2016-10, 2016-12, 2015-20)
This standard supersedes the existing revenue recognition guidance and provides a new framework for recognizing revenue. The core principle of the standard is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods and services. The new standard also requires significantly more comprehensive disclosures than the existing standard. Guidance subsequent to ASU 2014-09 has been issued to clarify various provisions in the standard, including principal versus agent considerations, identifying performance obligations, licensing transactions, as well as various technical corrections and improvements. This standard may be adopted using either a retrospective or modified retrospective method. Early adoption is permitted.
We are currently in the process of evaluating the impact this standard is expected to have on our consolidated financial statements. It is still too early in our process to determine the magnitude of the potential impact. However, based on our preliminary assessment, we believe that further evaluation of the initial territory fees associated with our licensing agreements may reveal differences in the timing of revenue recognition from current policy, but that it is likely that recognition of sales-based royalties will not significantly change. In addition to further evaluating each of our licensing agreements, we are in the process of assessing whether any sales promotions or discounts we currently offer related to our Shack sales could be considered separate performance obligations. As we continue our evaluation, we will further clarify the expected impact of the adoption of the standard.

We plan to adopt the standard on December 28, 2017, and we have not yet selected a transition method.

December 28, 2017

FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS
 
Assets and Liabilities Measured at Fair Value on a Recurring Basis
The following tables present information about our financial assets and liabilities measured at fair value on a recurring basis as of December 28, 2016 and December 30, 2015, and indicate the classification within the fair value hierarchy. Refer to Note 2 for further information.
Cash, Cash Equivalents and Marketable Securities
The following tables summarize our cash, cash equivalents and marketable securities by significant investment categories as of December 28, 2016 and December 30, 2015:
 
 
December 28, 2016
 
 
Cost Basis

 
 Gross Unrealized Gains

 
 Gross Unrealized Losses

 
 Fair Value

 
 Cash and Cash Equivalents

 
Marketable Securities

Cash
$
6,322

 
$
—

 
$
—

 
$
6,322

 
$
6,322

 
$
—

Level 1:
 
 
 
 
 
 
 
 
 
 
 
 
Money market funds
5,285

 
—

 
—

 
5,285

 
5,285

 
—

 
Mutual funds
60,232

 
—

 
—

 
60,232

 
—

 
60,232

Level 2:
 
 
 
 
 
 
 
 
 
 
 
 
Corporate debt securities(1)
2,473

 
3

 
(30
)
 
2,446

 
—

 
2,446

Total
$
74,312

 
$
3

 
$
(30
)
 
$
74,285

 
$
11,607

 
$
62,678


 
 
December 30, 2015
 
 
Cost Basis

 
 Gross Unrealized Gains

 
 Gross Unrealized Losses

 
 Fair Value

 
 Cash and Cash Equivalents

 
Marketable Securities

Cash
$
70,816

 
$
—

 
$
—

 
$
70,816

 
$
70,816

 
$
—

Level 1:
 
 
 
 
 
 
 
 
 
 
 
 
Money market funds
33

 
—

 
—

 
33

 
33

 
—

Level 2:
 
 
 
 
 
 
 
 
 
 
 
 
Corporate debt securities(1)
2,397

 
1

 
(12
)
 
2,386

 
—

 
2,386

Total
$
73,246

 
$
1

 
$
(12
)
 
$
73,235

 
$
70,849

 
$
2,386


(1)
The fair value of marketable securities with contractual maturity dates within one year are included in marketable securities and those with contractual maturity dates greater than one year are included in other assets on the Consolidated Balance Sheets. Corporate debt securities were measured at fair value using a market approach utilizing observable prices for identical securities or securities with similar characteristics and inputs that are observable or can be corroborated by observable market data.

Net unrealized losses on available-for-sale securities totaling $27 and $11 were included in accumulated other comprehensive loss on the Consolidated Balance Sheet as of December 28, 2016 and December 30, 2015, respectively.
The following tables summarize the gross unrealized losses and fair values for those investments that were in an unrealized loss position as of December 28, 2016 and December 30, 2015, aggregated by investment category and the length of time that individual securities have been in a continuous loss position:
 
 
December 28, 2016
 
 
 
Less than 12 Months
 
 
12 Months or Greater
 
 
Total
 
 
Fair Value

 
Unrealized Loss

 
Fair Value

 
Unrealized Loss

 
Fair Value

 
Unrealized Loss

 
Money market funds
$
—

 
$
—

 
$
—

 
$
—

 
$
—

 
$
—

 
Mutual funds
—

 
—

 
—

 
—

 
—

 
—

 
Corporate debt securities
1,244

 
(10
)
 
540

 
(20
)
 
1,784

 
(30
)
Total
$
1,244

 
$
(10
)
 
$
540

 
$
(20
)
 
$
1,784

 
$
(30
)
 
 
December 30, 2015
 
 
 
Less than 12 Months
 
 
12 Months or Greater
 
 
Total
 
 
Fair Value

 
Unrealized Loss

 
Fair Value

 
Unrealized Loss

 
Fair Value

 
Unrealized Loss

 
Money market funds
$
—

 
$
—

 
$
—

 
$
—

 
$
—

 
$
—

 
Corporate debt securities
2,397

 
(12
)
 
—

 
—

 
2,397

 
(12
)
Total
$
2,397

 
$
(12
)
 
$
—

 
$
—

 
$
2,397

 
$
(12
)

A summary of other income from available-for-sale securities recognized during fiscal 2016, 2015 and 2014 is as follows:
 
2016

 
2015

 
2014

Available-for-sale securities:
 
 
 
 
 
 
Dividend income
$
296

 
$
—

 
$
—

 
Interest income
88

 
7

 
—

 
Loss on investments
(7
)
 
—

 
—

Total other income, net
$
377

 
$
7

 
$
—


A summary of available-for-sale securities sold and gross realized gains and losses recognized during fiscal 2016 is as follows:
 
2016

Available-for-sale securities:
 
 
Gross proceeds from sales and redemptions
$
938

 
Cost basis of sales and redemptions
956

 
Gross realized gains included in net income
2

 
Gross realized losses included in net income
(20
)
 
Amounts reclassified out of accumulated other comprehensive loss
19


No available-for-sale securities were sold or redeemed during fiscal 2015 and 2014. Realized gains and losses are determined on a specific identification method and are included in other income, net on the Consolidated Statements of Income (Loss).
The following table summarizes the estimated fair value of our investments in marketable debt securities, accounted for as available-for-sale securities and classified by the contractual maturity date of the securities:
 
December 28
2016

Due within one year
$
1,807

Due after one year through 5 years
639

Due after 5 years through 10 years
—

Due after 10 years
—

Total
$
2,446


We periodically review our marketable securities for other-than-temporary impairment. We consider factors such as the duration, severity and the reason for the decline in value, the potential recovery period and our intent to sell. For marketable debt securities, we also consider whether (i) it is more likely than not that we will be required to sell the debt securities before recovery of their amortized cost basis, and (ii) the amortized cost basis cannot be recovered as a result of credit losses. As of December 28, 2016 and December 30, 2015, the declines in the market value of our marketable securities investment portfolio are considered to be temporary in nature.
Other Financial Instruments
The carrying value of our financial instruments, including accounts receivable, accounts payable, and accrued expenses as of December 28, 2016 and December 30, 2015 approximated their fair value due to the short-term nature of these financial instruments.
Assets and Liabilities Measured at Fair Value on a Non-Recurring Basis
Assets and liabilities that are measured at fair value on a non-recurring basis include our long-lived assets and indefinite-lived intangible assets. There were no impairments recognized during fiscal 2016, 2015 and 2014.
ACCOUNTS RECEIVABLE
ACCOUNTS RECEIVABLE
ACCOUNTS RECEIVABLE
 
The components of accounts receivable as of December 28, 2016 and December 30, 2015 are as follows:
 
December 28
2016

 
December 30
2015

Landlord receivables
$
2,606

 
$
1,380

Licensing receivables
1,278

 
1,669

Credit card receivables
1,589

 
1,023

Other receivables
533

 
145

Accounts receivable
$
6,006

 
$
4,217


As of December 28, 2016 and December 30, 2015, no allowance for doubtful accounts was recorded based on our evaluation of collectibility.
INVENTORIES
INVENTORIES
INVENTORIES
 
Inventories consisted of the following:
 
December 28
2016

 
December 30
2015

Food
$
543

 
$
328

Wine
47

 
30

Beer
58

 
46

Beverages
79

 
57

Retail merchandise
79

 
82

Inventories
$
806

 
$
543

PROPERTY AND EQUIPMENT
PROPERTY AND EQUIPMENT
PROPERTY AND EQUIPMENT
 
Property and equipment consisted of the following:
 
December 28
2016

 
December 30
2015

Leasehold improvements
$
120,629

 
$
82,904

Equipment
23,194

 
16,903

Furniture and fixtures
7,342

 
4,965

Computer equipment and software
8,710

 
5,197

Construction in progress (includes assets under construction from deemed landlord financing)
13,510

 
6,591

Property and equipment, gross
173,385

 
116,560

Less: accumulated depreciation
(37,121
)
 
(23,519
)
Property and equipment, net
$
136,264

 
$
93,041


Depreciation expense was $14,502, $10,222 and $5,809 for fiscal 2016, 2015 and 2014, respectively.
SUPPLEMENTAL BALANCE SHEET INFORMATION
SUPPLEMENTAL BALANCE SHEET INFORMATION
SUPPLEMENTAL BALANCE SHEET INFORMATION
 
The components of other current liabilities as of December 28, 2016 and December 30, 2015 are as follows:
 
December 28
2016

 
December 30
2015

Sales tax payable
$
1,324

 
$
1,073

Current portion of liabilities under tax receivable agreement
4,580

 
2,157

Gift card liability
1,153

 
833

Other
3,116

 
551

Other current liabilities
$
10,173

 
$
4,614

DEBT
DEBT
DEBT
 
In January 2015, we executed a Third Amended and Restated Credit Agreement, which became effective on February 4, 2015 (together with the prior agreements and amendments, and as further amended, the "Revolving Credit Facility"), which provides for a total revolving commitment amount of $50,000, of which $20,000 is available immediately. The Revolving Credit Facility will mature and all amounts outstanding will be due and payable five years from the effective date. The Revolving Credit Facility permits the issuance of letters of credit upon our request of up to $10,000. In May 2016, the Revolving Credit Facility was amended to, among other things, lower the borrowing rates. Borrowings under the Revolving Credit Facility bear interest at either: (i) LIBOR plus a percentage ranging from 2.3% to 3.3% or (ii) the prime rate plus a percentage ranging from 0.0% to 0.8%, depending on the type of borrowing made under the Revolving Credit Facility. As of December 28, 2016 and December 30, 2015, there were no amounts outstanding under the Revolving Credit Facility. As of December 28, 2016, we had $19,920 of availability under the Revolving Credit Facility, after giving effect to $80 in outstanding letters of credit.
The Revolving Credit Facility is secured by a first-priority security interest in substantially all of the assets of SSE Holdings and the guarantors. The obligations under the Revolving Credit Facility are guaranteed by each of SSE Holdings' wholly-owned domestic subsidiaries (with certain exceptions).
The Revolving Credit Facility contains a number of covenants that, among other things, limit our ability to, subject to specified exceptions, incur additional debt; incur additional liens and contingent liabilities; sell or dispose of assets; merge with or acquire other companies; liquidate or dissolve ourselves; pay dividends or make distributions; engage in businesses that are not in a related line of business; make loans, advances or guarantees; engage in transactions with affiliates; and make investments. In addition, the Revolving Credit Facility contains certain cross-default provisions. We are required to maintain a specified consolidated fixed-charge coverage ratio and a specified funded net debt to adjusted EBITDA ratio, both as defined under the Revolving Credit Facility. As of December 28, 2016, we were in compliance with all covenants.
In March 2013, we entered into a promissory note in the amount of $313 in connection with the purchase of a liquor license. Interest on the outstanding principal balance of this note is due and payable on a monthly basis from the effective date at a rate of 5.0% per year. The entire principal balance and interest is due and payable on the earlier of the maturity date, which is the expiration of the lease in June 2023, or the date of the sale of the license. As of December 30, 2015, the outstanding balance of the promissory note was $313. During the fiscal year ended December 28, 2016, we repaid the entire outstanding balance of the promissory note. No amounts were outstanding as of December 28, 2016.
As of December 28, 2016 we had deemed landlord financing liabilities of $2,007 for certain leases where we are involved in the construction of leased assets and are considered the accounting owner of the construction project. We had no deemed landlord financing liability as of December 30, 2015. Refer to Note 9 for further details regarding these leases.
Total interest costs incurred were $374, $440, and $365 in fiscal 2016, 2015 and 2014, respectively. No amounts were capitalized during fiscal 2016. During fiscal 2015, $108 was capitalized into property and equipment. No amounts were capitalized during fiscal 2014.
LEASES
LEASES
LEASES
 
A summary of rent expense under operating lease agreements is as follows:
 
 
2016

 
2015

 
2014

Minimum rent
$
15,408

 
$
10,796

 
$
6,497

Deferred rent
2,122

 
1,482

 
2,830

Contingent rent
4,294

 
2,959

 
1,883

Total rent expense
$
21,824

 
$
15,237

 
$
11,210


The rent expense above does not include common area maintenance costs, real estate taxes and other occupancy costs, which were $3,229, $2,119 and $1,111 in fiscal 2016, 2015 and 2014, respectively.
As of December 28, 2016, future minimum lease payments under non-cancelable operating leases and lease financing arrangements consisted of the following:
 
Operating
Leases

 
Deemed Landlord Financing(1)

2017
$
20,688

 
$
612

2018
21,872

 
1,484

2019
22,173

 
1,614

2020
21,766

 
1,642

2021
21,965

 
1,670

Thereafter
123,372

 
11,175

Total minimum lease payments
$
231,836

 
$
18,197


(1)
Amounts include minimum lease payments for eight leases under construction as of December 28, 2016 where we are deemed the accounting owner. Final classification of lease payments under deemed landlord financing is subject to change pending sale lease-back analysis performed at the store opening date.

As of December 28, 2016, we had eight leases where we are involved in the construction of the leased assets and have been deemed the accounting owner of the construction project. The deemed landlord financing liability related to these leases was $2,007 as of December 28, 2016. No deemed landlord financing liabilities were recognized as of December 30, 2015.
EMPLOYEE BENEFIT PLANS
EMPLOYEE BENEFIT PLANS
EMPLOYEE BENEFIT PLANS
 
Deferred Compensation
During fiscal 2013, we entered into an incentive bonus agreement with one of our executives, whereby the executive is entitled to receive a deferred compensation award in the amount of $2,450, payable by us in March 2018. In fiscal 2013, we recorded $2,054 of deferred compensation expense to recognize the present value of the incentive bonus liability, which is included in other long-term liabilities on the Consolidated Balance Sheet. The deferred compensation expense is included within general and administrative expense on the Consolidated Statement of Income (Loss). There was no such expense in fiscal 2016 or fiscal 2015. The difference between the present value of the bonus liability and the amount payable is accreted to interest expense over the remaining term until the incentive bonus becomes payable. In September 2015, we established a grantor trust, commonly referred to as a "rabbi trust," for the purpose of funding our deferred compensation obligation. We contributed $2,450 to the trust in October 2015. Assets held by the trust are subject to creditor claims in the event of insolvency, but are not available for general corporate purposes. As of December 28, 2016, amounts held by the trust were invested in various marketable securities classified as available-for-sale and recognized at fair value on the Consolidated Balance Sheet. See Note 3.
Defined Contribution Plan
Our employees are eligible to participate in a defined contribution savings plan maintained by Union Square Hospitality Group, LLC, a related party. The plan is funded by employee and employer contributions. We pay our share of the employer contributions directly to the third party trustee. Employer contributions to the plan are at our discretion. Effective January 2014, we began making contributions matching a portion of participants' contributions. We match 100% of participants' contributions for the first 3% of eligible compensation contributed and 50% of contributions made in excess of 3% of eligible compensation up to 5% of eligible compensation. Employer contributions totaled $257, $238 and $132 for fiscal 2016, 2015 and 2014, respectively.
STOCKHOLDER'S EQUITY
STOCKHOLDER'S EQUITY
STOCKHOLDERS' EQUITY
 
Amendment and Restatement of Certificate of Incorporation
On February 4, 2015, we amended and restated our certificate of incorporation to, among other things, provide for the (i) authorization of 200,000,000 shares of Class A common stock with a par value of $0.001 per share; (ii) authorization of 35,000,000 shares of Class B common stock with a par value of $0.001 per share; (iii) authorization of 10,000,000 shares of undesignated preferred stock that may be issued from time to time by our Board of Directors in one or more series; and (iv) establishment of a classified board of directors, divided into three classes, each of whose members will serve for staggered three-year terms.
Holders of our Class A and Class B common stock are entitled to one vote per share and, except as otherwise required, will vote together as a single class on all matters on which stockholders generally are entitled to vote. Holders of our Class B common stock are not entitled to receive dividends and will not be entitled to receive any distributions upon the liquidation, dissolution or winding up of the Company. Shares of Class B common stock may only be issued to the extent necessary to maintain the one-to-one ratio between the number of LLC Interests held by the non-controlling interest holders and the number of shares of Class B common stock held by the non-controlling interest holders. Shares of Class B common stock are transferable only together with an equal number of LLC Interests. Shares of Class B common stock will be canceled on a one-for-one basis upon the redemption or exchange of any of the outstanding LLC Interests.
We must, at all times, maintain a one-to-one ratio between the number of outstanding shares of Class A common stock and the number of LLC Interests owned by us (subject to certain exceptions for treasury shares and shares underlying certain convertible or exchangeable securities).
Initial Public Offering
As described in Note 1, on February 4, 2015, we completed an IPO of 5,750,000 shares of our Class A common stock at a public offering price of $21.00 per share, which includes 750,000 shares issued pursuant to the underwriters' over-allotment option. We received $112,298 in proceeds, net of underwriting discounts and commissions, which we used to purchase newly-issued LLC Interests from SSE Holdings at a price per interest equal to the initial public offering price of our Class A common stock.
In connection with our IPO, we issued 30,160,694 shares of Class B common stock to the non-controlling interest holders.
SSE Holdings Recapitalization
As described in Note 1, on February 4, 2015, we amended the SSE Holdings LLC Agreement to, among other things, (i) provide for a new single class of common membership interests in SSE Holdings, the LLC Interests, and (ii) exchange all of the then-existing membership interests of the non-controlling interest holders for LLC Interests.
The SSE Holdings LLC Agreement also provides that holders of LLC Interests may, from time to time, require SSE Holdings to redeem all or a portion of their LLC Interests for newly-issued shares of Class A common stock on a one-for-one basis. Upon receipt of a redemption request, we may, instead, elect to effect a direct exchange of LLC Interests directly with the holder. Additionally, we may elect to settle any such redemption or exchange in shares of Class A common stock or in cash. In the event of cash settlement, we would issue new shares of Class A common stock and use the proceeds from the sale of these newly-issued shares of Class A common stock to fund the cash settlement, which, in effect, limits the amount of the cash payment to the redeeming member. In connection with any redemption or exchange, we will receive a corresponding number of LLC Interests, increasing our total ownership interest in SSE Holdings. Additionally, an equivalent number of shares of Class B common stock will be surrendered and canceled.
The amendment also requires that SSE Holdings, at all times, maintain (i) a one-to-one ratio between the number of outstanding shares of Class A common stock and the number of LLC Interests owned by us and (ii) a one-to-one ratio between the number of shares of Class B common stock owned by the non-controlling interest holders and the number of LLC Interests owned by the non-controlling interest holders.
Secondary Offering
As described in Note 1, in August 2015, we completed a secondary offering of 4,000,000 shares of our Class A common stock at a price of $60.00 per share. All of the shares sold in the offering were offered by certain of the non-controlling interest holders. We did not receive any proceeds from the sale of shares of Class A common stock. The shares sold in the offering consisted of (i) 844,727 existing shares of Class A common stock and (ii) 3,155,273 newly-issued shares of Class A common stock issued in connection with the redemption of 3,155,273 LLC Interests. Simultaneously, and in connection with the secondary offering, 3,155,273 shares of Class B common stock were surrendered and cancelled.
Mergers
As described in Note 1, we acquired, by merger, two entities that were owned by former indirect members of SSE Holdings, for which we issued 5,968,841 shares of Class A common stock as merger consideration. In connection with these mergers, 5,968,841 shares of Class B common stock were canceled and we received 5,968,841 of LLC Interests. Additionally, in December 2015, the Meyer Group exercised their right to effect of tax-free reorganization of USC pursuant to the Stockholders Agreement. Prior to the USC Merger, USC owned 1,727,804 LLC Interests and an equivalent number of shares of our Class B common stock. In connection with the USC Merger, (i) 1,727,804 shares of Class A common stock were issued to the stockholders of USC, with each stockholder receiving newly-issued shares of Class A common stock in an amount equivalent to the number of shares of USC held by such stockholders; (ii) 1,727,804 shares of Class B common stock held by USC were cancelled; and (iii) 1,727,804 LLC Interests held by USC were transferred to us.
Member Distributions
On December 15, 2014, the Board of Directors of SSE Holdings approved a special distribution to its members, to the extent the gross proceeds from the IPO exceeded the anticipated gross proceeds (including as a result of the exercise by the underwriters of their option to purchase additional shares of Class A common stock), in an amount equal to the product of (i) the increased gross proceeds and (ii) 0.273, to be paid from the proceeds of the IPO (the "Special Distribution"). On February 4, 2015, SSE Holdings paid the Special Distribution to certain of the then-existing members in the amount of $11,125.
Redemptions of LLC Interests
During fiscal 2016, an aggregate of 5,207,149 LLC Interests were redeemed by the non-controlling interest holders. Pursuant to the SSE Holdings LLC Agreement, we issued 5,207,149 shares of Class A common stock in connection with these redemptions and received 5,207,149 LLC Interests, increasing our ownership interest in SSE Holdings. Simultaneously, and in connection with these redemptions, 5,207,149 shares of Class B common stock were surrendered and cancelled.
During fiscal 2015, subsequent to the secondary offering, an aggregate of 2,848,035 LLC Interests were redeemed by the non-controlling interest holders. Pursuant to the SSE Holdings LLC Agreement, we issued 2,848,035 shares of Class A common stock in connection with these redemptions and received 2,848,035 LLC Interests, increasing our ownership interest in SSE Holdings. Simultaneously, and in connection with these redemptions, 2,848,035 shares of Class B common stock were surrendered and cancelled.
Stock Option Exercises
During fiscal 2016, we received an aggregate of 154,976 LLC Interests in connection with the exercise of employee stock options. No stock options were exercised during fiscal 2015.
Dividend Restrictions
We are a holding company with no direct operations. As a result, our ability to pay cash dividends on our common stock, if any, is dependent upon cash dividends, distributions or other transfers from SSE Holdings. The amounts available to us to pay cash dividends are subject to certain covenants and restrictions set forth in the Revolving Credit Facility. As of December 28, 2016, essentially all of the net assets of SSE Holdings were restricted. See Note 8 for more information regarding the covenants and restrictions set forth in the Revolving Credit Facility.
NON-CONTROLLING INTERESTS
NON-CONTROLLING INTERESTS
NON-CONTROLLING INTERESTS
 
In connection with the Organizational Transactions described in Note 11, on February 4, 2015 we became the sole managing member of SSE Holdings and, as a result, consolidate the financial results of SSE Holdings. We report a non-controlling interest representing the economic interest in SSE Holdings held by the other members of SSE Holdings. The SSE Holdings LLC Agreement provides that holders of LLC Interests may, from time to time, require SSE Holdings to redeem all or a portion of their LLC Interests for newly-issued shares of Class A common stock on a one-for-one basis. In connection with any redemption or exchange, we will receive a corresponding number of LLC Interests, increasing our total ownership interest in SSE Holdings. Changes in our ownership interest in SSE Holdings while we retain our controlling interest in SSE Holdings will be accounted for as equity transactions. As such, future redemptions or direct exchanges of LLC Interests in SSE Holdings by the other members of SSE Holdings will result in a change in ownership and reduce the amount recorded as non-controlling interest and increase additional paid-in capital.
The following table summarizes the ownership interest in SSE Holdings as of December 28, 2016 and December 30, 2015:
 
2016
 
 
2015
 
 
LLC Interests

 
Ownership %

 
LLC Interests

 
Ownership %

Number of LLC Interests held by Shake Shack Inc.
25,151,384

 
69.1
%
 
19,789,259

 
54.6
%
Number of LLC Interests held by non-controlling interest holders
11,253,592

 
30.9
%
 
16,460,741

 
45.4
%
Total LLC Interests outstanding
36,404,976

 
100.0
%
 
36,250,000

 
100.0
%

The weighted average ownership percentages for the applicable reporting periods are used to attribute net income and other comprehensive loss between Shake Shack Inc. and the non-controlling interest holders. The non-controlling interest holders' weighted average ownership percentage for fiscal 2016 was 36.8%. For fiscal 2015, net income was attributed to non-controlling interest holders only for the period subsequent to the IPO and the Organizational Transactions, based on a weighted-average ownership percentage of 61.0%.
The following table summarizes the effects of changes in ownership in SSE Holdings on our equity during fiscal 2016, 2015 and 2014.
 
2016

 
2015

 
2014

Net income (loss) attributable to Shake Shack Inc.
$
12,446

 
$
(8,776
)
 
$
2,118

Other comprehensive loss:
 
 
 
 
 
 
Unrealized holding losses on available-for-sale securities
(10
)
 
(5
)
 
—

Transfers (to) from non-controlling interests:
 
 
 
 
 
 
Increase in additional paid-in capital as a result of settlement of unit appreciation rights
—

 
987

 
—

 
Decrease in additional paid-in capital as a result of the organizational transactions completed in connection with our IPO
—

 
(75,182
)
 
—

 
Increase in additional paid-in capital as a result of the redemption of LLC Interests
16,986

 
19,934

 
—

 
Increase in additional paid-in capital as a result of the USC Merger
—

 
5,908

 
—

 
Increase in additional paid-in capital as a result of stock option exercises and the related income tax effect
825

 
—

 
—

Total effect of changes in ownership interest on equity attributable to Shake Shack Inc.
$
30,247

 
$
(57,134
)
 
$
2,118


In February 2015, we used the net proceeds from our IPO to purchase 5,750,000 newly-issued LLC Interests. Additionally, in connection with our IPO, we acquired 5,968,841 LLC Interests through the acquisition, by merger, of two entities that were owned by former indirect members of SSE Holdings. Pursuant to the SSE Holdings LLC Agreement, we received 339,306 LLC Interests as a result of the issuance of 339,306 shares of Class A common stock upon settlement of the outstanding UARs.
In December 2015, we received 1,727,804 LLC Interests in connection with the USC Merger in exchange for an equivalent number of newly-issued shares of Class A common stock.
During fiscal 2016, an aggregate of 5,207,149 LLC Interests were redeemed by the non-controlling interest holders for newly-issued shares of Class A common stock, and we received 5,207,149 LLC Interests, increasing our total ownership interest in SSE Holdings to 69.1%. During 2015, an aggregate of 6,003,308 LLC Interests were redeemed by the non-controlling interest holders (which included 3,155,273 LLC Interests redeemed in connection with a secondary offering) for newly-issued shares of Class A common stock, and we received 6,003,308 LLC Interests.
During fiscal 2016, we received an aggregate of 154,976 LLC Interests in connection with the exercise of employee stock options. No stock options were exercised during fiscal 2015.
EQUITY-BASED COMPENSATION
EQUITY-BASED COMPENSATION
EQUITY-BASED COMPENSATION
 
A summary of equity-based compensation expense recognized during fiscal 2016, 2015 and 2014 is as follows:
 
 
2016

 
2015

 
2014

Unit appreciation rights
$
—

 
$
11,762

 
$
—

Restricted Class B units
—

 
605

 
165

Stock options
4,262

 
4,314

 
—

Performance stock units
1,092

 
—

 
—

Equity-based compensation expense
$
5,354

 
$
16,681

 
$
165

 
 
 
 
 
 
Total income tax benefit recognized related to equity-based compensation
$
168

 
$
482

 
$
4


Amounts are included in general and administrative expense and labor and related expenses on the Consolidated Statements of Income (Loss). We capitalized $139 of equity-based compensation in fiscal 2016. No amounts were capitalized in fiscal 2015 and 2014.
Unit Appreciation Rights
Prior to the IPO, we maintained a Unit Appreciation Rights Plan (the "UAR Plan"), effective in fiscal year 2012, and as amended, whereby we had the authority to grant up to 31,303 unit appreciation rights ("UARs") to employees. The UARs granted were subject to continued employment and were only exercisable upon a qualifying transaction. Our IPO constituted a qualifying transaction under the terms of the UAR Plan, and as a result 339,306 shares of Class A common stock were issued upon the settlement of the 22,554 outstanding UARs, net of employee withholding taxes. We recognized compensation expense of $11,762 during fiscal 2015 upon settlement of the outstanding UARs.
There were no UARs outstanding as of December 28, 2016 or December 30, 2015. No compensation expense was recognized during fiscal 2016 and 2014.
Restricted Class B Units
Prior to the IPO, we granted restricted Class B units to certain of our executive officers. These awards were to vest in equal installments over periods ranging from three to five years. If not already fully vested, these units would fully vest (i) upon the occurrence of a change in control event or (ii) upon the occurrence of an initial public offering. The IPO constituted a transaction under the terms of the restricted Class B unit award agreements that resulted in the accelerated vesting of all then-outstanding awards, and we recognized $605 of equity-based compensation expense upon the vesting of these awards during fiscal 2015.
There were no restricted Class B units outstanding as of December 28, 2016 or December 30, 2015. No compensation expense was recorded during fiscal 2016 and $165 was recorded during fiscal 2014.
Stock Options
In January 2015, we adopted the 2015 Incentive Award Plan (the "2015 Plan") under which we may grant up to 5,865,522 stock options and other equity-based awards to employees, directors and officers. The stock options granted generally vest equally over periods ranging from one to five years. We do not use cash to settle any of our equity-based awards, and we issue new shares of Class A common stock upon the exercise of stock options.
The fair value of stock option awards was determined on the grant date using the Black-Scholes valuation model based on the following weighted-average assumptions:
 
2016

 
2015

Expected term (years)(1)
5.5

 
7.5

Expected volatility(2)
50.7
%
 
35.1
%
Risk-free interest rate(3)
1.5
%
 
1.6
%
Dividend yield(4)
—
%
 
—
%
(1)
Expected term represents the estimated period of time until an award is exercised and was determined using the simplified method.
(2)
Expected volatility is based on the historical volatility of a selected peer group over a period equivalent to the expected term.
(3)
The risk-free rate rate is an interpolation of yields on U.S. Treasury securities with maturities equivalent to the expected term.
(4)
We have assumed a dividend yield of zero as we have no plans to declare dividends in the foreseeable future.
A summary of stock option activity for fiscal years 2015 and 2016 is as follows:
 
 
Stock
Options

 
Weighted
Average
Exercise
Price

 
Aggregate Intrinsic Value

 
Weighted Average Remaining Contractual Life (Years)
Outstanding as of December 31, 2014
—

 
$
—

 

 

 
Granted
2,622,281

 
21.00

 

 

 
Exercised
—

 
—

 

 

 
Forfeited
(47,300
)
 
(21.00
)
 

 

 
Expired
—

 
—

 

 

Outstanding as of December 30, 2015
2,574,981

 
$
21.00

 

 

 
Granted
16,931

 
34.74

 

 

 
Exercised
(160,230
)
 
21.00

 

 

 
Forfeited
(66,960
)
 
(21.00
)
 

 

 
Expired
—

 
—

 

 

Outstanding as of December 28, 2016
2,364,722

 
$
21.10

 
$
37,201

 
8.1
Options vested and exercisable as of December 28, 2016
400,471

 
$
21.00

 
$
6,339

 
8.1
Options expected to vest as of December 28, 2016
1,847,242

 
$
21.13

 
$
29,009

 
8.1

No stock options were granted in fiscal 2014. As of December 28, 2016, total unrecognized compensation expense related to unvested stock options, including an estimate for pre-vesting forfeitures, was $12,621, which is expected to be recognized over a weighted-average period of 3.1 years. Cash received from stock option exercises was $3,194 for fiscal 2016.
A summary of unvested stock option activity for fiscal 2015 and 2016 is as follows:
 
 
Stock
Options

 
Weighted
Average
Grant-Date Fair Value

Unvested as of December 31, 2014
—

 
$
—

 
Vested
—

 
—

 
Granted
2,622,281

 
8.53

 
Forfeited
(47,300
)
 
8.59

Unvested as of December 30, 2015
2,574,981

 
$
8.53

 
Vested
(562,296
)
 
8.32

 
Granted
16,931

 
16.32

 
Forfeited
(65,365
)
 
8.59

Unvested as of December 28, 2016
1,964,251

 
$
8.66


The following table summarizes information about stock options outstanding and exercisable as December 28, 2016:
 
 
Options Outstanding
 
 
Options Exercisable
 
 
 
Number Outstanding at December 28, 2016

 
Weighted Average Remaining Contractual Life (Years)
 
Weighted Average Exercise Price

 
Number Exercisable at December 28, 2016

 
Weighted Average Remaining Contractual Life (Years)

 
Weighted Average Exercise Price

Exercise Price
 
 
 
 
 
 
$21.00
 
2,347,791

 
8.1
 
$
21.00

 
400,471

 
8.1

 
$
21.00

$34.62
 
15,823

 
9.4
 
$
34.62

 
—

 
—

 
$
—

$36.41
 
1,108

 
9.9
 
$
36.41

 
—

 
—

 
$
—


Performance Stock Units
Under the 2015 Plan, we may grant performance stock units and other types of performance-based equity awards that vest based on the outcome of certain performance criteria that are established and approved by the Compensation Committee of the Board of Directors. The actual number of equity awards earned is based on the level of performance achieved over a predetermined performance period, relative to established financial goals, none of which are considered market conditions.
For performance stock units granted during fiscal 2016, the amount of awards that can be earned range from 0% to 125% of the number of performance stock units granted, based on the achievement of approved financial goals over a one-year performance period. In addition to the performance conditions, performance stock units are also subject to a requisite service period and the awards will vest ratably over three years. The fair value of performance stock units is determined based on the closing market price of our Class A common stock on the date of grant. Compensation expense related to the performance stock units is recognized using a graded-vesting attribution method over the vesting period based on the most probable outcome of the performance conditions.
A summary of performance stock unit activity for fiscal 2016 is as follows:
 
 
Performance
Stock
Units

 
Weighted
Average
Grant Date Fair Value

Outstanding at beginning of period
—

 
$
—

 
Granted
63,600

 
38.41

 
Vested
—

 
—

 
Forfeited
(2,000
)
 
38.43

 
Expired
—

 
—

Outstanding at end of period
61,600

 
$
38.41


No performance stock units were granted in fiscal 2015 and 2014. As of December 28, 2016, there were 61,600 performance stock units outstanding, of which none were vested. As of December 28, 2016, total unrecognized compensation expense related to unvested performance stock units, including an estimate for pre-vesting forfeitures, was $1,591, which is expected to be recognized over a weighted-average period of 2.3 years.
INCOME TAXES
INCOME TAXES
INCOME TAXES
 
We are the sole managing member of SSE Holdings, and as a result, consolidate the financial results of SSE Holdings. SSE Holdings is treated as a partnership for U.S. federal and most applicable state and local income tax purposes. As a partnership, SSE Holdings is not subject to U.S. federal and certain state and local income taxes. Any taxable income or loss generated by SSE Holdings is passed through to and included in the taxable income or loss of its members, including us, on a pro rata basis. We are subject to U.S. federal income taxes, in addition to state and local income taxes with respect to our allocable share of any taxable income or loss of SSE Holdings, as well as any stand-alone income or loss generated by Shake Shack Inc. We are also subject to withholding taxes in foreign jurisdictions.
Income Tax Expense
The components of income before income taxes are follows:
 
2016

 
2015

 
2014

Domestic
$
20,623

 
$
244

 
$
(3,007
)
Foreign
7,873

 
6,184

 
5,787

Income before income taxes
$
28,496

 
$
6,428

 
$
2,780


The components of income tax expense are as follows:
 
 
 
2016

 
2015

 
2014

Current income taxes:
 
 
 
 
 
 
Federal
$
3,767

 
$
2,474

 
$
—

 
State and local
2,439

 
1,131

 
194

 
Foreign
667

 
433

 
561

 
Total current income taxes
6,873

 
4,038

 
755

Deferred income taxes:
 
 
 
 
 
 
Federal
(48
)
 
(267
)
 
—

 
State and local
(475
)
 
(467
)
 
(93
)
 
Total deferred income taxes
(523
)
 
(734
)
 
(93
)
Income tax expense
$
6,350

 
$
3,304

 
$
662


Reconciliations of income tax expense computed at the U.S. federal statutory income tax rate to the recognized income tax expense and the U.S. statutory income tax rate to our effective tax rates are as follows:
 
 
2016
 
 
2015
 
 
2014
 
Expected U.S. federal income taxes at statutory rate
$
9,689

34.0
 %
 
$
2,186

34.0
 %
 
$
945

34.0
 %
State and local income taxes, net of federal benefit
1,461

5.1
 %
 
663

10.3
 %
 
101

3.6
 %
Foreign withholding taxes
667

2.3
 %
 
433

6.7
 %
 
561

20.2
 %
Non-deductible expenses
25

0.1
 %
 
653

10.2
 %
 
—

—
 %
Tax credits
(779
)
(2.7
)%
 
(141
)
(2.2
)%
 
—

—
 %
Rate change impact
(1,353
)
(4.7
)%
 
—

—
 %
 
—

—
 %
Non-controlling interest
(3,765
)
(13.2
)%
 
(490
)
(7.6
)%
 
—

—
 %
LLC flow-through structure
—

—
 %
 
—

—
 %
 
(976
)
(35.1
)%
Other
405

1.4
 %
 
—

—
 %
 
31

1.1
 %
Income tax expense
$
6,350

22.3
 %
 
$
3,304

51.4
 %
 
$
662

23.8
 %


Our effective income tax rates for fiscal 2016, 2015 and 2014 were 22.3%, 51.4% and 23.8%, respectively. The decrease in our effective income tax rate from fiscal 2015 to fiscal 2016 is due to the IPO and Organizational Transactions that occurred in fiscal 2015. As the non-recurring compensation expenses and other IPO-related expenses recognized during fiscal 2015 were incurred in the period prior to the Organizational Transactions, and prior to our becoming a member of SSE Holdings, we were not entitled to any tax benefits related to those losses. We recognized tax expense in fiscal 2015 based on our allocable share of the taxable income generated in the period subsequent to our becoming a member of SSE Holdings, which resulted in a very high effective tax rate in fiscal 2015 when compared to our consolidated pre-tax income. Additionally, in fiscal 2016, the effective tax rate was positively impacted by a tax benefit of $1,353 we recognized due to the impact from a tax rate change on our deferred tax assets, as well as other rate changes. In fiscal 2014, we were only subject to certain LLC entity-level taxes and foreign withholding taxes, whereas in fiscal 2015 and fiscal 2016 we were also subject to U.S. federal, state and local income taxes on our allocable share of any taxable income or loss generated by SSE Holdings subsequent to the IPO and Organizational Transactions.
Deferred Tax Assets and Liabilities
The components of deferred tax assets and liabilities are as follows:
 
 
 
December 28
2016

 
December 30
2015

Deferred tax assets:
 
 
 
 
Investment in partnership
$
209,648

 
$
154,649

 
Tax Receivable Agreement
110,022

 
69,513

 
Deferred rent
561

 
492

 
Deferred revenue
53

 
63

 
Stock-based compensation
331

 
218

 
Net operating loss carryforwards
7,338

 
334

 
Tax credits
1,084

 
—

 
Other assets
108

 
159

 
Total gross deferred tax assets
329,145

 
225,428

Valuation allowance
(15,568
)
 
(23,155
)
Total deferred tax assets, net of valuation allowance
313,577

 
202,273

Deferred tax liabilities:
 
 
 
 
Property and equipment
(370
)
 
(316
)
 
Total gross deferred tax liabilities
(370
)
 
(316
)
Net deferred tax assets
$
313,207

 
$
201,957


As of December 28, 2016, our federal and state net operating loss carryforwards for income tax purposes were $19,019 and $197,201. If not utilized, our federal and state net operating loss carryforwards will expire between 2028 and 2036.
As described in Note 11, we acquired an aggregate of 5,362,125 LLC Interests during fiscal 2016 through redemptions of LLC Interests and the exercise of employee stock options. We recognized a deferred tax asset in the amount of $67,580 associated with the basis difference in our investment in SSE Holdings upon acquiring these LLC Interests. These were partially offset by reductions in basis due to the utilization of $12,269 of amortization. However, a portion of the total basis difference will only reverse upon the eventual sale of our interest in SSE Holdings, which we expect would result in a capital loss. As of December 28, 2016, we established a valuation allowance in the amount of $15,568 against the deferred tax asset to which this portion relates.
During fiscal 2016, we also recognized $40,094 of deferred tax assets related to additional tax basis increases generated from expected future payments under the Tax Receivable Agreement and related deductions for imputed interest on such payments. See "—Tax Receivable Agreement" for more information.
We evaluate the realizability of our deferred tax assets on a quarterly basis and establish valuation allowances when it is more likely than not that all or a portion of a deferred tax asset may not be realized. As of December 28, 2016, we concluded, based on the weight of all available positive and negative evidence, that all of our deferred tax assets (except for those deferred tax assets described above relating to basis differences that are expected to result in a capital loss upon the eventual sale of our interest in SSE Holdings) are more likely than not to be realized. As such, no additional valuation allowance was recognized. The net change in valuation allowance for fiscal 2016 was a decrease of $7,587.
Uncertain Tax Positions
No uncertain tax positions existed as of December 28, 2016 and December 30, 2015. Shake Shack Inc. was formed in September 2014 and did not engage in any operations prior to the IPO and Organizational Transactions. Shake Shack Inc. first filed tax returns for tax year 2014, which is the first tax year subject to examination by taxing authorities for U.S. federal and state income tax purposes. Additionally, although SSE Holdings is treated as a partnership for U.S. federal and state income taxes purposes, it is still required to file an annual U.S. Return of Partnership Income, which is subject to examination by the Internal Revenue Service ("IRS"). The statute of limitations has expired for tax years through 2012 for SSE Holdings.
Tax Receivable Agreement
Pursuant to our election under Section 754 of the Internal Revenue Code (the "Code"), we expect to obtain an increase in our share of the tax basis in the net assets of SSE Holdings when LLC Interests are redeemed or exchanged by the non-controlling interest holders and other qualifying transactions. We plan to make an election under Section 754 of Code for each taxable year in which a redemption or exchange of LLC Interest occurs. We intend to treat any redemptions and exchanges of LLC Interests by the non-controlling interest holders as direct purchases of LLC Interests for U.S. federal income tax purposes. These increases in tax basis may reduce the amounts that we would otherwise pay in the future to various tax authorities. They may also decrease gains (or increase losses) on future dispositions of certain capital assets to the extent tax basis is allocated to those capital assets.
On February 4, 2015, we entered into a tax receivable agreement with the then-existing non-controlling interest holders (the "Tax Receivable Agreement") that provides for the payment by us to the non-controlling interest holders of 85% of the amount of any tax benefits that we actually realize, or in some cases are deemed to realize, as a result of (i) increases in our share of the tax basis in the net assets of SSE Holdings resulting from any redemptions or exchanges of LLC Interests, (ii) tax basis increases attributable to payments made under the Tax Receivable Agreement, and (iii) deductions attributable to imputed interest pursuant to the Tax Receivable Agreement (the "TRA Payments"). We expect to benefit from the remaining 15% of any tax benefits that we may actually realize. The TRA Payments are not conditioned upon any continued ownership interest in SSE Holdings or us. The rights of each non-controlling interest holder under the Tax Receivable Agreement are assignable to transferees of its LLC Interests.
During fiscal 2016, we acquired an aggregate of 5,207,149 LLC Interests in connection with the redemption of LLC Interests, which resulted in an increase in the tax basis of our investment in SSE Holdings subject to the provisions of the Tax Receivable Agreement. We recognized an additional liability in the amount of $100,063 for the TRA Payments due to the redeeming members, representing 85% of the aggregate tax benefits we expect to realize from the tax basis increases related to the redemption of LLC Interests, after concluding it was probable that such TRA Payments would be paid based on our estimates of future taxable income. As of December 28, 2016, the total amount of TRA Payments due under the Tax Receivable Agreement, including accrued interest, was $272,482, of which $4,580 was included in other current liabilities on the Consolidated Balance Sheet. See Note 17 for more information relating to our liabilities under the Tax Receivable Agreement.
EARNINGS PER SHARE
EARNINGS PER SHARE
EARNINGS PER SHARE
 
Basic earnings per share of Class A common stock is computed by dividing net income available to Shake Shack Inc. by the weighted-average number of shares of Class A common stock outstanding during the period. Diluted earnings per share of Class A common stock is computed by dividing net income available to Shake Shack Inc. by the weighted-average number of shares of Class A common stock outstanding adjusted to give effect to potentially dilutive securities.
As described in Note 1, on February 4, 2015, the SSE Holdings LLC Agreement was amended and restated to, among other things, (i) provide for a new single class of common membership interests, the LLC Interests, and (ii) exchange all of the then-existing membership interests of the non-controlling interest holders for LLC Interests. For purposes of calculating earnings per share, the amounts prior to fiscal 2015 have been retroactively adjusted to give effect to the above-mentioned amendment and resulting recapitalization. The computations of earnings per share for periods prior to our IPO do not consider the 5,750,000 shares of Class A common stock issued to investors in our IPO or the 339,306 shares of Class A common stock issued upon settlement of outstanding UARs in connection with the IPO.
The following table sets forth reconciliations of the numerators and denominators used to compute basic and diluted earnings per share of Class A common stock for fiscal 2016, 2015 and 2014.
 
 
 
2016

 
2015

 
2014

Numerator:
 
 
 
 
 
 
Net income
$
22,146

 
$
3,124

 
$
2,118

 
Less: net income attributable to non-controlling interests
9,700

 
11,900

 
—

 
Net income (loss) attributable to Shake Shack Inc.
$
12,446

 
$
(8,776
)
 
$
2,118

Denominator:
 
 
 
 
 
 
Weighted-average shares of Class A common stock outstanding—basic
22,956

 
13,588

 
29,977

 
Effect of dilutive securities:
 
 
 
 
 
 
 
Restricted Class B units
—

 
—

 
145

 
 
Stock options
493

 
—

 
—

 
Weighted-average shares of Class A common stock outstanding—diluted
23,449

 
13,588

 
30,122

 
 
 
 
 
 
 
 
Earnings per share of Class A common stock—basic
$
0.54

 
$
(0.65
)
 
$
0.07

Earnings per share of Class A common stock—diluted
$
0.53

 
$
(0.65
)
 
$
0.07


Shares of our Class B common stock do not share in the earnings or losses of Shake Shack and are therefore not participating securities. As such, separate presentation of basic and diluted earnings per share of Class B common stock under the two-class method has not been presented.
The following table presents potentially dilutive securities excluded from the computations of diluted earnings per share of Class A common stock for fiscal 2016, 2015 and 2014.
 
 
 
2016
 
2015
 
2014
Stock options
125

(1)
 
2,574,981

(2)
 
—

 
Performance stock units
26,860

(3)
 
—

 
 
—

 
Shares of Class B common stock
11,253,592

(4)
 
16,460,741

(4)
 
—

 
(1)
Weighted-average number of securities excluded from the computation of diluted earnings per share of Class A common stock because the exercise price of the stock options exceeded the average market price.
(2)
Excluded from the computation of diluted earnings per share of Class A common stock because the effect would have been anti-dilutive.
(3)
Weighted-average number of securities excluded from the computation of diluted earnings per share of Class A common stock because the performance conditions were not met for a portion of the fiscal year.
(4)
Shares of our Class B common stock are considered potentially dilutive shares of Class A common stock. Amounts have been excluded from the computations of diluted earnings per share of Class A common stock because the effect would have been anti-dilutive under the if-converted and two-class methods.
SUPPLEMENTAL CASH FLOW INFORMATION
SUPPLEMENTAL CASH FLOW INFORMATION
SUPPLEMENTAL CASH FLOW INFORMATION
 
The following table sets forth supplemental cash flow information for fiscal 2016, 2015 and 2014:
 
 
2016

 
2015

 
2014

Cash paid for:
 
 
 
 
 
 
Income taxes, net of refunds
$
1,823

 
$
416

 
$
836

 
Interest, net of amounts capitalized
54

 
92

 
123

Non-cash investing activities:
 
 
 
 
 
 
Accrued purchases of property and equipment
6,150

 
4,904

 
3,577

 
Property and equipment acquired through landlord incentives
—

 
—

 
6,000

 
Capitalized landlord assets for leases where we are deemed the accounting owner
1,985

 
—

 
—

 
Capitalized equity-based compensation
139

 
—

 
—

 
Class A common stock issued in connection with the acquisition of the former indirect members of SSE Holdings
—

 
6

 
—

 
Class A common stock issued in connection with the USC Merger
—

 
2

 
—

Non-cash financing activities:
 
 
 
 
 
 
Cancellation of Class B common stock in connection with the Organizational Transactions
—

 
(6
)
 
—

 
Class A common stock issued in connection with the redemption of LLC Interests
5

 
6

 
—

 
Cancellation of Class B common stock in connection with the redemption of LLC Interests
(5
)
 
(6
)
 
—

 
Cancellation of Class B common stock in connection with the USC Merger
—

 
(2
)
 
—

 
Establishment of liabilities under tax receivable agreement
100,063

 
173,090

 
—

 
Accrued distributions payable to non-controlling interest holders
607

 
—

 
—

COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES
 
Lease Commitments
We are obligated under various operating leases for Shacks and our home office space, expiring in various years through 2034. Under certain of these leases, we are liable for contingent rent based on a percentage of sales in excess of a specified threshold and are responsible for our proportionate share of real estate taxes and common area charges. See Note 9, Leases.
As security under the terms of several of our leases, we are obligated under letters of credit totaling $160 as of December 28, 2016. The letters of credit expire on April 23, 2017 and February 28, 2026. In addition, in December 2013, we entered into an irrevocable standby letter of credit in conjunction with our home office lease in the amount of $80. The letter of credit expires in September 2017 and renews automatically for one-year periods through September 30, 2019.
Purchase Commitments
Purchase obligations include legally binding contracts, including commitments for the purchase, construction or remodeling of real estate and facilities, firm minimum commitments for inventory purchases, equipment purchases, marketing-related contracts, software acquisition/license commitments and service contracts. These obligations are generally short-term in nature and are recorded as liabilities when the related goods are received or services rendered. We also enter into long-term, exclusive contracts with certain vendors to supply us with food, beverages and paper goods, obligating us to purchase specified quantities. These volume commitments are generally not subject to any time limit and there are no material financial penalties associated with these agreements in the event of early termination.
Legal Contingencies
In November 2015, we participated in a voluntary mediation with counsel representing two former Shake Shack managers, who alleged that we improperly classified our restaurant managers as exempt from overtime protections. At the conclusion of the mediation, the parties mutually agreed to fully and finally resolve the matter by settling, rather than litigating. In connection with the settlement, the parties entered into a memorandum of understanding, pursuant to which we agreed to create a settlement fund in the amount of $750 and, in exchange for their participation in the settlement fund, all participating employees (current and former) will be required to release Shake Shack from all federal and/or state wage and hour claims that may exist through the settlement date. On March 11, 2016, as required by the memorandum of understanding, the parties entered into a settlement agreement in the amount of $750. To facilitate the resolution of the matter, the parties coordinated the filing by the plaintiff's counsel of a Complaint on March 17, 2016 with the Supreme Court of the State of New York (the “Court”). On October 25, 2016, the Court granted preliminary approval of the settlement agreement. On December 13, 2016, all eligible class members were mailed the notice of settlement, and the deadline to opt-out or object was January 27, 2017. On March 7, 2017, the Court held a fairness hearing, at which time it determined that the settlement agreement was fair, adequate and equitable, and subsequently issued its order granting final approval of the settlement.  As of December 28, 2016, an accrual in the amount of $770 was recognized, which included $750 for the mutually agreed upon settlement fund and $20 for related legal expenses.

We are subject to various legal proceedings, claims and liabilities, such as employment-related claims and slip and fall cases, which arise in the ordinary course of business and are generally covered by insurance. As of December 28, 2016, the amount of ultimate liability with respect to these matters was not material.
Liabilities under Tax Receivable Agreement
As described in Note 14, we are a party to the Tax Receivable Agreement under which we are contractually committed to pay the non-controlling interest holders 85% of the amount of any tax benefits that we actually realize, or in some cases are deemed to realize, as a result of certain transactions. We are not obligated to make any payments under the Tax Receivable Agreement until the tax benefits associated the transaction that gave rise to the payment are realized. Amounts payable under the Tax Receivable Agreement are contingent upon, among other things, (i) generation of future taxable income over the term of the Tax Receivable Agreement and (ii) future changes in tax laws. If we do not generate sufficient taxable income in the aggregate over the term of the Tax Receivable Agreement to utilize the tax benefits, then we would not be required to make the related TRA Payments. As of December 28, 2016, we recognized $272,482 of liabilities relating to our obligations under the Tax Receivable Agreement, after concluding that it was probable that we would have sufficient future taxable income to utilize the related tax benefits. There were no transactions subject to the Tax Receivable Agreement for which we did not recognize the related liability, as we concluded that we would have sufficient future taxable income to utilize all of the related tax benefits generated by all transactions that occurred in fiscal 2016.
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS
 
Union Square Hospitality Group
Union Square Hospitality Group, LLC is a stockholder and a party to the Stockholders Agreement we entered into in connection with our IPO. The Chairman of our Board of Directors serves as the Chief Executive Officer of Union Square Hospitality Group, LLC. As a result, Union Square Hospitality Group, LLC and its subsidiaries (collectively, "USHG") are considered related parties.
Under the terms of the management agreement with USHG, as amended, in fiscal 2014, we paid a 2.5% management fee to USHG based on Shack sales and licensing revenue generated from license agreements with unaffiliated entities. Total management fees, which are included in general and administrative expenses, amounted to $2,927 for fiscal 2014. Effective January 1, 2015, the management agreement was amended and restated. As a result, we are no longer obligated to pay management fees to USHG. Therefore, no management fees were paid to USHG for fiscal 2016 and 2015.
Previously, we sub-leased office space from USHG on a month-to-month basis. Amounts paid to USHG as rent totaled $38 for fiscal 2014. These amounts are included in general and administrative expenses on the Consolidated Statements of Income (Loss). No amounts were paid during fiscal 2016 and 2015.
Previously, our employees were included in USHG's self-insurance health plan and we paid our portion of the plan costs on a monthly basis to USHG. Amounts paid to USHG for these health insurance costs were $1,306 for fiscal 2014. In February 2015, we established our own self-funded health insurance plan for our employees and ceased payments to USHG. Amounts paid to USHG for these health insurance costs were $146 for fiscal 2015. No amounts were paid to USHG for these health insurance costs for fiscal 2016. These amounts are included in labor and related expenses and general and administrative expenses on the Consolidated Statements of Income (Loss). Additionally, our employees are eligible participants under USHG's 401(k) plan. We pay our share of the employer's matching contributions directly to the third-party plan trustee.
We also pay USHG for certain miscellaneous general operating expenses incurred by them on our behalf. Total amounts paid to USHG for general corporate expenses were $10, $157 and $490 for fiscal 2016, 2015 and 2014, respectively, and are included in general and administrative expenses on the Consolidated Statements of Income (Loss).
Total amounts payable to USHG as of December 28, 2016 and December 30, 2015 were $1 and $2, respectively, and are included in other current liabilities on the Consolidated Balance Sheets. No amounts were due from USHG as of December 28, 2016 and December 30, 2015.
Hudson Yards Sports and Entertainment
In fiscal 2011, we entered into a Master License Agreement (as amended, an "MLA") with Hudson Yards Sports and Entertainment LLC ("HYSE"), a subsidiary of USHG and a related party, to operate Shake Shack branded limited menu concession stands in sports and entertainment venues within the United States. The agreement expires on December 31, 2027 and includes five consecutive five-year renewal options at HYSE's option. As consideration for these rights, HYSE pays us a license fee based on a percentage of net food sales, as defined in the MLA. HYSE also pays us a percentage of profits on sales of branded beverages, as defined in the MLA. Amounts paid to us by HYSE for fiscal 2016, 2015 and 2014 were $309, $282 and $218, respectively, and are included in licensing revenue on the Consolidated Statements of Income (Loss). Amounts due from HYSE as of December 28, 2016 were $11 and is included in prepaid expenses and other current assets on the Consolidated Balance Sheets. No amounts were due from HYSE as of December 30, 2015.
Madison Square Park Conservancy
The Chairman of our Board of Directors serves as a director of the Madison Square Park Conservancy ("MSP Conservancy"), with which we have a license agreement and pay license fees to operate our Madison Square Park Shack. Amounts paid to Madison Square Park Conservancy as rent amounted to $1,062, $692 and $528 for fiscal 2016, 2015 and 2014, respectively. These amounts are included in occupancy and related expenses on the Consolidated Statements of Income (Loss). Total amounts due to the MSP Conservancy as of December 28, 2016 and December 30, 2015 were $1 and $17, respectively.
Share Our Strength
The Chairman of our Board of Directors serves as a director of Share Our Strength, for which Shake Shack holds the "Great American Shake Sale" every year during the month of May to raise money and awareness for childhood hunger. During the Great American Shake Sale, we encourage guests to donate money to Share Our Strength's No Kid Hungry campaign in exchange for a coupon for a free cake-themed shake. All of the guest donations we collect go directly to Share Our Strength. We raised a total of $587, $504 and $338 in fiscal 2016, 2015 and 2014, respectively, and the proceeds were remitted to Share Our Strength in the respective years. We incurred costs of approximately $117, $109 and $69 for fiscal 2016, 2015 and 2014, respectively, representing the cost of the free shakes redeemed. These costs are included in general and administrative expenses and other operating expenses on the Consolidated Statements of Income (Loss). Additionally, we held a promotional event in August 2016 in which we donated a total of $20 to the Share Our Strength's No Kid Hungry campaign, which is included in general and administrative expenses on the Consolidated Statements of Income (Loss).
Mobo Systems, Inc.
The Chairman of our Board of Directors serves as a director of Mobo Systems, Inc. (also known as "Olo"), a platform we use in connection with our mobile ordering application. No amounts were paid to Olo for fiscal 2016 and 2014. Amounts paid to Olo for fiscal 2015 were $8. No amounts were payable to Olo as of December 28, 2016 and December 30, 2015.
Tax Receivable Agreement
In connection with our IPO, we entered into a Tax Receivable Agreement with certain non-controlling interest holders that provides for the payment by us to the non-controlling holders of 85% of the amount of any tax benefits that Shake Shack actually realizes or in some cases is deemed to realize as a result of (i) increases in the tax basis of the net assets of SSE Holdings resulting from any redemptions or exchanges of LLC Interests and (ii) certain other tax benefits related to our making payments under the Tax Receivable Agreement. See Note 14 for further information. There were no amounts paid under the Tax Receivable Agreement to the non-controlling interest holders during fiscal 2016, 2015 and 2014. Total amounts due to the non-controlling interest holders as of December 28, 2016 and December 30, 2015 under the Tax Receivable Agreement were $272,482 and $173,090, respectively.
Distributions to Members of SSE Holdings
Under the terms of the SSE Holdings LLC Agreement, SSE Holdings is obligated to make tax distributions to its members. During fiscal 2016 tax distributions of $1,745 were paid to non-controlling interest holders. A special distribution was paid to certain members of SSE Holdings in the amount of $11,125 on February 4, 2015. No tax distributions were paid to non-controlling interest holders during fiscal 2015 and 2014. As of December 28, 2016, $607 was payable to non-controlling interest holders and no amounts were payable to non-controlling interest holders as of December 30, 2015.
GEOGRAPHIC INFORMATION
GEOGRAPHIC INFORMATION
GEOGRAPHIC INFORMATION
 
Revenue by geographic area for fiscal 2016, 2015 and 2014 is as follows:
 
 
2016

 
2015

 
2014

United States
$
260,602

 
$
184,408

 
$
112,743

Other countries
7,873

 
6,184

 
5,787

Total revenue
$
268,475

 
$
190,592

 
$
118,530


Revenues are shown based on the geographic location of our customers and licensees. All of our assets are located in the United States.
SELECTED QUARTERLY FINANCIAL DATA (UNAUDITED)
SELECTED QUARTERLY FINANCIAL DATA (UNAUDITED)
SELECTED QUARTERLY FINANCIAL DATA (UNAUDITED)
 
The following table sets forth certain unaudited financial information for each quarter of fiscal 2016 and 2015. The unaudited quarterly information includes all adjustments (consisting of normal recurring adjustments) that, in the opinion of management, are necessary for the fair presentation of the information presented. Operating results for interim periods are not necessarily indicative of the results that may be expected for a full fiscal year.
 
 
 
2016
 
 
 
 
First

 
Second

 
Third

 
Fourth

 
 
 
Quarter

 
Quarter

 
Quarter

 
Quarter

Total revenue
$
54,165

 
$
66,472

 
$
74,567

 
$
73,271

Operating income
4,714

 
8,933

 
9,170

 
4,988

Net income
3,351

 
6,549

 
6,789

 
5,457

Net income attributable to Shake Shack Inc.
1,462

 
3,298

 
3,766

 
3,920

Earnings per share(1):
 
 
 
 
 
 
 
 
Basic
$
0.07

 
$
0.15

 
$
0.16

 
$
0.16

 
Diluted
$
0.07

 
$
0.14

 
$
0.15

 
$
0.15


 
 
 
2015
 
 
 
 
First

 
Second

 
Third

 
Fourth

 
 
 
Quarter

 
Quarter

 
Quarter

 
Quarter

Total revenue
$
37,808

 
$
48,450

 
$
53,273

 
$
51,061

Operating income (loss)
(10,949
)
 
6,244

 
7,804

 
3,654

Net income (loss)
(11,260
)
 
5,145

 
6,193

 
3,046

Net income (loss) attributable to Shake Shack Inc.
(12,668
)
 
1,118

 
1,528

 
1,246

Earnings (loss) per share(1):
 
 
 
 
 
 
 
 
Basic
$
(1.06
)
 
$
0.09

 
$
0.11

 
$
0.08

 
Diluted
$
(1.06
)
 
$
0.08

 
$
0.10

 
$
0.07

(1)
Basic and diluted earnings per share are computed independently for each of the quarters presented. Therefore, the sum of quarterly basic and diluted earnings per share amounts may not equal annual basic and diluted earnings per share amounts.
SCHEDULE I: CONDENSED FINANCIAL INFORMATION OF REGISTRANT
Condensed Financial Information of Registrant
SHAKE SHACK INC.
CONDENSED BALANCE SHEETS
(PARENT COMPANY ONLY)
(in thousands, except share and per share amounts)
 
 
 
December 28
2016

 
December 30
2015

ASSETS
 
 
 
Current assets:
 
 
 
 
Cash
$
3,785

 
$
422

 
Accounts receivable
2

 
—

 
Prepaid expenses
105

 
628

 
Total current assets
3,892

 
1,050

Due from SSE Holdings
—

 
3,979

Deferred income taxes, net
312,802

 
201,614

Investment in subsidiaries
109,680

 
67,810

TOTAL ASSETS
$
426,374

 
$
274,453

LIABILITIES AND STOCKHOLDERS' EQUITY
 
 
 
Current liabilities:
 
 
 
 
Income taxes payable
$
—

 
$
689

 
Accrued expenses
49

 
59

 
Due to SSE Holdings
1,655

 
—

 
Current portion of liabilities under tax receivable agreement
4,580

 
2,157

 
Total current liabilities
6,284

 
2,905

Liabilities under tax receivable agreement, net of current portion
267,902

 
170,933

Total liabilities
274,186

 
173,838

Commitments and contingencies

 

Stockholders' equity:
 
 
 
 
Preferred stock, no par value—10,000,000 shares authorized; none issued and outstanding as of December 28, 2016 and December 30, 2015, respectively.
—

 
—

 
Class A common stock, $0.001 par value—200,000,000 shares authorized; 25,151,384 and 19,789,259 shares issued and outstanding as of December 28, 2016 and December 30, 2015, respectively.
25

 
20

 
Class B common stock, $0.001 par value—35,000,000 shares authorized; 11,253,592 and 16,460,741 shares issued and outstanding as of December 28, 2016 and December 30, 2015, respectively.
11

 
16

 
Additional paid-in capital
135,448

 
96,311

 
Retained earnings
16,719

 
4,273

 
Accumulated other comprehensive loss
(15
)
 
(5
)
 
Total stockholders' equity
152,188

 
100,615

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY
$
426,374

 
$
274,453

See accompanying Notes to Condensed Financial Statements.
SHAKE SHACK INC.
CONDENSED STATEMENTS OF INCOME
(PARENT COMPANY ONLY)
(in thousands)
 
 
 
Fiscal Year Ended
 
 
 
 
December 28
2016

 
December 30
2015

 
December 31
2014

Intercompany revenue
$
1,603

 
$
1,336

 
$
—

TOTAL REVENUE
1,603

 
1,336

 
—

General and administrative expenses
1,603

 
1,336

 
—

TOTAL EXPENSES
1,603

 
1,336

 
—

OPERATING INCOME
—

 
—

 
—

Equity in net income of subsidiaries
16,982

 
6,906

 
—

Other income
688

 
—

 
—

Interest expense
(16
)
 
—

 
—

INCOME BEFORE INCOME TAXES
17,654

 
6,906

 
—

Income tax expense
5,208

 
2,633

 
—

NET INCOME
$
12,446

 
$
4,273

 
$
—

See accompanying Notes to Condensed Financial Statements.
SHAKE SHACK INC.
CONDENSED STATEMENTS OF COMPREHENSIVE INCOME
(PARENT COMPANY ONLY)
(in thousands)
 
 
 
Fiscal Year Ended
 
 
 
 
December 28
2016

 
December 30
2015

 
December 31
2014

Net income
$
12,446

 
$
4,273

 
$
—

Other comprehensive (loss), net of tax:
 
 
 
 
 
 
Available-for-sale securities(1):
 
 
 
 
 
 
 
Change in net unrealized holding (losses)
(22
)
 
(5
)
 
—

 
 
Less: reclassification adjustments for net realized losses included in net income
12

 
—

 
—

 
 
Net change
(10
)
 
(5
)
 
—

OTHER COMPREHENSIVE LOSS
(10
)
 
(5
)
 
—

COMPREHENSIVE INCOME
12,436

 
4,268

 
—

(1) Net of tax benefit of $0 for fiscal years ended December 28, 2016, December 30, 2015 and December 31, 2014.
See accompanying Notes to Condensed Financial Statements.
SHAKE SHACK INC.
CONDENSED STATEMENTS OF CASH FLOWS
(PARENT COMPANY ONLY)
(in thousands)
 
 
 
 
 
 
Fiscal Year Ended
 
 
 
 
 
 
 
December 28
2016

 
December 30
2015

 
December 31
2014

OPERATING ACTIVITIES
 
 
 
 
 
Net income
$
12,446

 
$
4,273

 
$
—

Adjustments to reconcile net income to net cash provided by (used in) operating activities:
 
 
 
 
 
 
Equity in net income of subsidiaries
(16,982
)
 
(6,906
)
 
—

 
Equity-based compensation
189

 
330

 
—

 
Non-cash reimbursement revenue treated as investment
(189
)
 
—

 
—

 
Deferred income taxes
(462
)
 
(551
)
 
—

 
Other non-cash income
(688
)
 
—

 
—

 
Changes in operating assets and liabilities:
 
 
 
 
 
 
 
Accounts receivable
(2
)
 
—

 
—

 
 
Prepaid expenses and other current assets
(1
)
 
—

 
—

 
 
Due to/from SSE Holdings
214

 
4

 
—

 
 
Accrued expenses
(11
)
 
58

 
—

 
 
Other current liabilities
17

 
—

 
—

 
 
Income taxes payable
5,023

 
3,184

 
—

NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES
(446
)
 
392

 
—

INVESTING ACTIVITIES
 
 
 
 
 
Purchases of LLC Interests from SSE Holdings
(4,559
)
 
(112,298
)
 
—

Return of investment in SSE Holdings
2,694

 
—

 
—

NET CASH USED IN INVESTING ACTIVITIES
(1,865
)
 
(112,298
)
 
—

FINANCING ACTIVITIES
 
 
 
 
 
Proceeds from issuance of Class A common stock sold in initial public offering, net of underwriting discounts and commissions
—

 
112,298

 
—

Proceeds from issuance of Class A common stock to SSE Holdings upon settlement of stock option exercises
2,489

 
—

 
—

Proceeds from issuance of Class B common stock
—

 
30

 
—

Proceeds from stock option exercises
3,185

 
—

 
—

NET CASH PROVIDED BY FINANCING ACTIVITIES
5,674

 
112,328

 
—

INCREASE IN CASH
3,363

 
422

 
—

CASH AT BEGINNING OF PERIOD
422

 
—

 
—

CASH AT END OF PERIOD
$
3,785

 
$
422

 
$
—


See accompanying Notes to Condensed Financial Statements.
NOTE 1: ORGANIZATION
Shake Shack Inc. (the "Parent Company") was formed on September 23, 2014 as a Delaware corporation and is a holding company with no direct operations. The Parent Company's assets consist primarily of its equity interest in SSE Holdings, LLC ("SSE Holdings") and certain deferred tax assets.
On February 4, 2015, the Parent Company completed an initial public offering ("IPO") of 5,750,000 shares of its Class A common stock at a public offering price of $21.00 per share, which includes 750,000 shares issued pursuant to the underwriters' over-allotment option. The Parent Company received $112,298 in proceeds, net of underwriting discounts and commissions, which it used to purchase newly-issued membership interests from SSE Holdings at a price per interest equal to the initial public offering price of its Class A common stock.
The Parent Company's cash inflows are primarily from cash dividends or distributions and other transfers from SSE Holdings. The amounts available to the Parent Company to fulfill cash commitments and pay cash dividends on its common stock are subject to certain restrictions in SSE Holdings' revolving credit agreement. See Note 8 to the consolidated financial statements.
NOTE 2: BASIS OF PRESENTATION
These condensed parent company financial statements should be read in conjunction with the consolidated financial statements of Shake Shack Inc. and the accompanying notes thereto, included in this Annual Report on Form 10-K. For purposes of these condensed financial statements, the Parent Company's interest in SSE Holdings is recorded based upon its proportionate share of SSE Holdings' net assets (similar to presenting them on the equity method).
The Parent Company is the sole managing member of SSE Holdings, and pursuant to the Third Amended and Restated LLC Agreement of SSE Holdings (the “SSE Holdings LLC Agreement”), receives compensation in the form of reimbursements for all costs associated with being a public company and maintaining its existence. Intercompany revenue consists of these reimbursement payments and is recognized when the corresponding expense to which it relates is recognized.
Certain intercompany balances presented in these condensed parent company financial statements are eliminated in the consolidated financial statements. $1,655 of intercompany payables were eliminated in consolidation as of December 28, 2016 and $3,979 of intercompany receivables were eliminated in consolidation as of December 30, 2015. For fiscal 2016, $1,603 and $16,982 of intercompany revenue and equity in net income of subsidiaries, respectively, was eliminated in consolidation. For fiscal 2015, $1,336 and $6,906 of intercompany revenue and equity in net income of subsidiaries, respectively, was eliminated in consolidation. Related party amounts that were not eliminated in the consolidated financial statements include the Parent Company's liabilities under the tax receivable agreement, which totaled $272,482 and $173,090 as of December 28, 2016 and December 30, 2015, respectively.
NOTE 3: COMMITMENTS AND CONTINGENCIES
On February 4, 2015, the Parent Company entered into a tax receivable agreement with the non-controlling interest holders that provides for payments to the non-controlling interest holders of 85% of the amount of any tax benefits that the Parent Company actually realizes, or in some cases is deemed to realize, as a result of certain transactions. See Note 14 to the consolidated financial statements for more information regarding the Parent Company's tax receivable agreement. As described in Note 17 to the consolidated financial statements, amounts payable under the tax receivable agreement are contingent upon, among other things, (i) generation of future taxable income of Shake Shack Inc. over the term of the tax receivable agreement and (ii) future changes in tax laws. As of December 28, 2016 and December 30, 2015, liabilities under the tax receivable agreement totaled $272,482 and $173,090, respectively.
NOTE 4: SUPPLEMENTAL CASH FLOW INFORMATION
The following table sets forth supplemental cash flow information for fiscal 2016, 2015 and 2014:
 
 
 
 
 
 
2016

 
2015

 
2014

Cash paid for:
 
 
 
 
 
 
Income taxes
$
576

 
$
—

 
$
—

Non-cash investing activities:
 
 
 
 
 
 
Accrued contribution related to stock option exercises
1,116

 
—

 
—

 
Class A common stock issued in connection with the acquisition of two entities owned by former indirect members of SSE Holdings
—

 
6

 
—

 
Class A common stock issued in connection with the USC Merger
—

 
2

 
—

 
Class A common stock issued in connection with the acquisition of LLC Interests upon redemption by the non-controlling interest holders
18,944

 
19,933

 
—

 
Non-cash contribution made in connection with equity awards granted to employees of SSE Holdings
5,304

 
2,355

 
—

Non-cash financing activities:
 
 
 
 
 
 
Cancellation of Class B common stock in connection with the Organizational Transactions
—

 
(6
)
 
—

 
Cancellation of Class B common stock in connection with the redemption of LLC Interests
(5
)
 
(6
)
 
—

 
Cancellation of Class B common stock in connection with the USC Merger
—

 
(2
)
 
—

 
Establishment of liabilities under tax receivable agreement
100,063

 
173,090

 
—

SCHEDULE II: VALUATION AND QUALIFYING ACCOUNTS
SCHEDULE II: VALUATION AND QUALIFYING ACCOUNTS
Schedule II: Valuation and Qualifying Accounts
 
 
 
Balance at beginning of period

 
Additions
 
 
Reductions

 
Balance at end of period

(in thousands)
 
 
Charged to costs and expenses

 
Charged to other accounts

 
 
Deferred tax asset valuation allowance:
 
 
 
 
 
 
 
 
 
 
Fiscal year ended December 31, 2014
 
$
—

 
$
—

 
$
—

 
$
—

 
$
—

Fiscal year ended December 30, 2015
 
$
—

 
$
—

 
$
39,700

(1)
$
(16,545
)
 
$
23,155

Fiscal year ended December 28, 2016
 
$
23,155

 
$
90

 
$
1,965

(1)
$
(9,642
)
 
$
15,568

(1)
Amount relates to a valuation allowance established on deferred tax assets related to our investment in SSE Holdings.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)
Basis of Presentation 
Basis of Presentation
The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and include our accounts and the accounts of our subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. Certain reclassifications have been made to prior period amounts to conform to the current year presentation.
Pursuant to the provisions of Accounting Standards Update No. 2015-02, Amendments to the Consolidation Analysis ("ASU 2015-02"), adopted on December 31, 2015, SSE Holdings is now considered a VIE. Prior to the adoption of ASU 2015-02, we consolidated SSE Holdings as a voting interest entity. Shake Shack Inc. is the primary beneficiary as we have the majority economic interest in SSE Holdings and, as the sole managing member, have decision making authority that significantly affects the economic performance of the entity, while the limited partners have no substantive kick-out or participating rights. As a result, we will continue to consolidate SSE Holdings. The assets and liabilities of SSE Holdings represent substantially all of our consolidated assets and liabilities with the exception of certain deferred taxes and liabilities under the Tax Receivable Agreement. As of December 28, 2016 and December 30, 2015, the net assets of SSE Holdings were $158,845 and $124,214, respectively. The assets of SSE Holdings are subject to certain restrictions in SSE Holdings' revolving credit agreements. See Note 8 for more information.
Fiscal Year 
Fiscal Year
We operate on a 52/53 week fiscal year ending on the last Wednesday in December. Fiscal year 2016 contained 52 weeks and ended on December 28, 2016. Fiscal year 2015 contained 52 weeks and ended on December 30, 2015. Fiscal year 2014 contained 53 weeks and ended on December 31, 2014. Unless otherwise stated, references to years in this report relate to fiscal years.
Use of Estimates 
Use of Estimates
The preparation of these consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of sales and expenses during the reporting period. Actual results could differ from those estimates.
Segment Reporting 
Segment Reporting
We own and operate Shacks in the United States. We also have domestic and international licensed operations. Our chief operating decision maker (the "CODM") is our Chief Executive Officer. As the CODM reviews financial performance and allocates resources at a consolidated level on a recurring basis, we have one operating segment and one reportable segment.
Fair Value Measurements 
Fair Value Measurements
We apply fair value accounting for all financial assets and liabilities and non-financial assets and liabilities that are recognized or disclosed at fair value in the financial statements on a recurring basis. Fair value is defined as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurements for assets and liabilities that are required to be recorded at fair value, we assume the highest and best use of the asset by market participants in which we would transact and the market-based risk measurements or assumptions that market participants would use in pricing the asset or liability, such as inherent risk, transfer restrictions, and credit risk.
Assets and liabilities are classified using a fair value hierarchy, which prioritizes the inputs used to measure fair value into three levels, and bases the categorization within the hierarchy upon the lowest level of input that is available and significant to the fair value measurement:
▪
Level 1 - Quoted prices in active markets for identical assets or liabilities
▪
Level 2 - Observable inputs other than quoted prices in active markets for identical assets or liabilities, quoted prices for identical assets or liabilities in inactive markets, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities
▪
Level 3 - Inputs that are both unobservable and significant to the overall fair value measurements reflecting an entity's estimates of assumptions that market participants would use in pricing the asset or liability
Cash and Cash Equivalents 
Cash and Cash Equivalents
Cash and cash equivalents consist primarily of cash on hand, deposits with banks, and short-term, highly liquid investments that have original maturities of three months or less. Cash equivalents are stated at cost, which approximates fair value. Cash equivalents consist primarily of money market funds.
Accounts Receivable 
Accounts Receivable
Accounts receivable consist primarily of receivables from landlords for tenant improvement allowances, receivables from our licensees for licensing revenue and related reimbursements, credit card receivables and vendor rebates. We evaluate the collectibility of our accounts receivable based on a variety of factors, including historical experience, current economic conditions and other factors.
Inventories 
Inventories
Inventories, which consist of food, beer, wine, other beverages and retail merchandise, are stated at the lower of cost or market with cost determined on a first-in, first-out basis.
Property and Equipment 
Property and Equipment
Property and equipment is stated at historical cost less accumulated depreciation. Property and equipment is depreciated based on the straight-line method over the estimated useful lives of the assets, generally ranging from three to seven years for equipment, furniture and fixtures, and computer equipment and software. Leasehold improvements are depreciated over the shorter of their estimated useful life or the related lease life, generally ranging from 10 to 20 years. For leases with renewal periods at our option, we use the original lease term, excluding renewal option periods, to determine estimated useful lives.
Costs incurred when constructing Shacks are capitalized. The cost of repairs and maintenance are expensed when incurred. Costs for refurbishments and improvements that significantly increase the productive capacity or extend the useful life of the asset are capitalized. When assets are disposed of, the resulting gain or loss is recognized on the Consolidated Statements of Income (Loss).
We assess potential impairments to our long-lived assets, which includes property and equipment, whenever events or circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of an asset is measured by a comparison of the carrying amount of an asset group to its estimated undiscounted future cash flows expected to be generated by the asset. If the carrying amount of the asset group exceeds its estimated undiscounted future cash flows, an impairment charge is recognized as the amount by which the carrying amount of the asset exceeds the fair value of the asset.
Deferred Financing Costs 
Deferred Financing Costs
Deferred financing costs incurred in connection with the issuance of long-term debt and establishing credit facilities are capitalized and amortized to interest expense based on the related debt agreements. Deferred financing costs are included in other assets on the Consolidated Balance Sheets.
Other Assets 
Other Assets
Other assets consist primarily of long-term marketable securities, security deposits, transferable liquor licenses and certain custom furniture pre-ordered for future Shacks and yet to be placed in service.
The costs of obtaining non-transferable liquor licenses that are directly issued by local government agencies for nominal fees are expensed as incurred. The costs of purchasing transferable liquor licenses through open markets in jurisdictions with a limited number of authorized liquor licenses are capitalized as indefinite-lived intangible assets. Annual liquor license renewal fees are expensed over the renewal term. As of December 28, 2016 and December 30, 2015, indefinite-lived intangible assets relating to transferable liquor licenses totaled $701. We evaluate our indefinite-lived intangible assets for impairment annually during our fiscal fourth quarter, and whenever events or changes in circumstances indicate that an impairment may exist. When evaluating other intangible assets for impairment, we may first perform a qualitative assessment to determine whether it is more likely than not that an intangible asset group is impaired. If we do not perform the qualitative assessment, or if we determine that it is not more likely than not that the fair value of the intangible asset group exceeds its carrying amount, we calculate the estimated fair value of the intangible asset group. If the carrying amount of the intangible asset group exceeds the estimated fair value, an impairment charge is recorded to reduce the carrying value to the estimated fair value. In addition, we continuously monitor and may revise our intangible asset useful lives if and when facts and circumstances change.
Equity-based Compensation 
Equity-based Compensation
Equity-based compensation expense is measured based on fair value. For awards with graded-vesting features and service conditions only, compensation expense is recognized on a straight-line basis over the total requisite service period for the entire award. For awards with graded-vesting features and a combination of service and performance conditions, compensation expense is recognized using a graded-vesting attribution method over the vesting period based on the most probable outcome of the performance conditions. Equity-based compensation expense is included within general and administrative expenses and labor and related expenses on the Consolidated Statements of Income (Loss).
Leases 
Leases
We lease all of our domestic company-operated Shacks, our home office and certain equipment under various non-cancelable lease agreements that expire on various dates through 2034. Generally, our real estate leases have initial terms ranging from 10 to 20 years and typically include two five-year renewal options. At the inception of each lease, we determine its classification as an operating or capital lease. Most of our leases are classified as operating leases and typically provide for fixed minimum rent payments and/or contingent rent payments based upon sales in excess of specified thresholds. When the achievement of such sales thresholds are deemed to be probable, contingent rent is accrued in proportion to the sales recognized during the period. For operating leases that include rent holidays and rent escalation clauses, we recognize rent expense on a straight-line basis over the lease term from the date we take possession of the leased property. The difference between the straight-line rent amounts and amounts payable under the lease agreements is recorded as deferred rent and is included as rent expense in occupancy and related expenses on the Consolidated Statements of Income (Loss). Rent expense incurred before a Shack opens is recorded in pre-opening costs. Once a domestic company-operated Shack opens, we record the straight-line rent expense and any contingent rent, if applicable, in occupancy and related expenses on the Consolidated Statements of Income (Loss).
Many of our leases also require us to pay real estate taxes, common area maintenance costs and other occupancy costs which are included in occupancy and related expenses on the Consolidated Statements of Income (Loss).
We expend cash for leasehold improvements to build out and equip our leased premises. Generally, a portion of the leasehold improvements and building costs are reimbursed by our landlords as landlord incentives pursuant to agreed-upon terms in our lease agreements. If obtained, landlord incentives usually take the form of up-front cash, full or partial credits against our future minimum or contingent rents otherwise payable by us, or a combination thereof. When contractually due, we classify landlord incentives as deferred rent on the Consolidated Balance Sheets and amortize the landlord incentives on a straight-line basis over the lease term as a reduction of occupancy costs and related expenses or pre-opening costs on the Consolidated Statements of Income (Loss).
Lease Financing Arrangements
In certain leasing arrangements, due to our involvement in the construction of the leased assets, we are considered the owner of the leased assets for accounting purposes. In such cases, in addition to capitalizing our own construction costs, we capitalize the construction costs funded by the landlord related to our leased premises, and also recognize a corresponding liability for those costs as deemed landlord financing. If, upon completion of construction, the arrangement does not meet the sales recognition criteria under the sale-leaseback accounting guidance, we would be precluded from de-recognizing the landlord-funded asset and related financing obligation and would continue to account for the landlord-funded asset as if we were the legal owner. If de-recognition is permitted we would be required to account for the lease as either an operating or capital lease.
Revenue Recognition 
Revenue Recognition
Revenue consists of Shack sales and licensing revenue. Revenue from Shack sales are presented net of discounts and recognized when food and beverage products are sold. Sales tax collected from customers is excluded from Shack sales and the obligation is included in sales tax payable until the taxes are remitted to the appropriate taxing authorities. Revenue from our gift cards are deferred and recognized upon redemption. Licensing revenues include initial territory fees and ongoing licensing fees from all licensed Shacks. Initial territory fees are recorded as deferred revenue when received and proportionate amounts are recognized as revenue when a licensed Shack is opened and all material services and conditions related to the fee have been substantially performed. Ongoing licensing fees from these Shacks are based on a percentage of sales and are recognized as revenue as the fees are earned and become receivable from the licensee.
Income Taxes 
Income Taxes
We account for income taxes pursuant to the asset and liability method which requires the recognition of deferred income tax assets and liabilities related to the expected future tax consequences arising from temporary differences between the carrying amounts and tax bases of assets and liabilities based on enacted statutory tax rates applicable to the periods in which the temporary differences are expected to reverse. Any effects of changes in income tax rates or laws are included in income tax expense in the period of enactment. A valuation allowance is recognized if we determine it is more likely than not that all or a portion of a deferred tax asset will not be recognized.
Pre-Opening Costs 
Pre-Opening Costs
Pre-opening costs are expensed as incurred and consist primarily of legal fees, occupancy, manager and employee wages, travel and related training costs incurred prior to the opening of a Shack.
Advertising 
Advertising
The cost of advertising is expensed as incurred.
Recently Issued and Adopted Accounting Pronouncements 
Recently Adopted Accounting Pronouncements     
We adopted the Accounting Standards Updates (“ASUs”) summarized below in fiscal 2016. The effects of adoption did not have a material impact on our consolidated financial statements.
Accounting Standards Update (“ASU”)
Description
Date
Adopted
Customers' Accounting for Fees Paid in a Cloud Computing Arrangement
(ASU 2015-05)

This standard provides guidance in evaluating whether a cloud computing arrangement includes a software license. If a cloud computing arrangement includes a software license, then the software license element of the arrangement should be accounted for as an acquisition of a software license. Otherwise, it should be accounted for as a service contract.
December 31, 2015
Simplifying the Presentation of Debt Issuance Costs
(ASU 2015-03, 2015-15)

ASU 2015-03 requires that debt issuance costs related to a recognized liability be presented on the balance sheet as a direct reduction from the carrying amount of that debt liability, consistent with debt discounts. ASU 2015-15 clarifies that for line-of-credit arrangements, the SEC staff would not object to an entity deferring and presenting debt issuance costs as an asset and subsequently amortizing the deferred issuance costs ratably over the term of the line-of-credit arrangement.
December 31, 2015

Recently Issued Accounting Pronouncements       
Accounting Standards Update (“ASU”)
Description
Expected Impact
Effective Date
Statement of Cash Flows: Classification of Certain Cash Receipts and Payments
(ASU 2016-15)

This standard provides guidance on eight specific cash flow issues with the objective of reducing diversity in practice. It should be applied retrospectively to each period presented, subject to certain conditions.
We are currently evaluating the impact this standard will have on our consolidated financial statements.

December 28, 2017

Improvements to Employee Share-Based Payment Accounting
(ASU 2016-09)

This standard simplifies certain aspects of accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, an option to recognize gross stock compensation expense with actual forfeitures recognized as they occur, as well as certain classifications on the statement of cash flows. Adoption methodology allowed varies based on each provision of the standard.

The adoption of this standard is not expected to have a material effect on our consolidated financial statements.

December 29, 2016

Recognition of Breakage for Certain Prepaid Stored-Value Products
(ASU 2016-04)

This standard provides guidance on derecognition of a liability resulting from the sale of certain prepaid store-value products when an entity expects to be entitled to a breakage amount. It should be applied using either a modified retrospective or retrospective transition method.
The adoption of this standard is not expected to have a material effect on our consolidated financial statements.

December 28, 2017

Leases
(ASU 2016-02)

This standard establishes a new lease accounting model, which introduces the recognition of lease assets and liabilities for those leases classified as operating leases under previous GAAP. It should be applied using a modified retrospective approach, with the option to elect various practical expedients. Early adoption is permitted.

We are currently evaluating the impact this standard will have on our consolidated financial statements.
December 27, 2018

Recognition and Measurement of Financial Assets and Financial Liabilities
(ASU 2016-01)
For public business entities, this standard requires: (i) certain equity investments to be measured at fair value with changes in fair value recognized in net income; (ii) a qualitative assessment to identify impairment of equity investments without readily determinable fair values; (iii) elimination of the requirement to disclose the method(s) and significant assumptions used to estimate the fair value for financial instruments measured at amortized cost on the balance sheet; (iv) use of the exit price notion when measuring the fair value of financial instruments for disclosure purposes; (v) separate presentation in other comprehensive income of the portion of the total change in the fair value of a liability resulting from a change in the instrument-specific credit risk when the entity has elected to measure the liability at fair value in accordance with the fair value option for financial instruments; (vi) separate presentation of financial assets and liabilities by measurement category and form of financial asset in the financial statements; and (vii) an entity to evaluate the need for a valuation allowance on a deferred tax asset related to available-for-sale securities in combination with the entity’s other deferred tax assets. The standard should be applied by means of a cumulative-effect adjustment to the balance sheet at the beginning of the fiscal year of adoption. Early adoption is permitted, subject to certain conditions resulting from a change in the instrument-specific credit risk when the entity has elected to measure the liability at fair value.

We are currently evaluating the impact this standard will have on our consolidated financial statements.
December 28, 2017
Accounting Standards Update (“ASU”)
Description
Expected Impact
Effective Date
Simplifying the Measurement of Inventory
(ASU 2015-11)

This standard applies to inventory measured using methods other than last-in, first-out (LIFO) or the retail method, and requires entities to measure such inventory at the lower of cost or net realizable value. It should be applied prospectively.

The adoption of this standard is not expected to have a material effect on our consolidated financial statements.
December 29, 2016

Revenue from Contracts with Customers and related standards
(ASU’s 2014-09, 2015-14, 2016-08, 2016-10, 2016-12, 2015-20)
This standard supersedes the existing revenue recognition guidance and provides a new framework for recognizing revenue. The core principle of the standard is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods and services. The new standard also requires significantly more comprehensive disclosures than the existing standard. Guidance subsequent to ASU 2014-09 has been issued to clarify various provisions in the standard, including principal versus agent considerations, identifying performance obligations, licensing transactions, as well as various technical corrections and improvements. This standard may be adopted using either a retrospective or modified retrospective method. Early adoption is permitted.
We are currently in the process of evaluating the impact this standard is expected to have on our consolidated financial statements. It is still too early in our process to determine the magnitude of the potential impact. However, based on our preliminary assessment, we believe that further evaluation of the initial territory fees associated with our licensing agreements may reveal differences in the timing of revenue recognition from current policy, but that it is likely that recognition of sales-based royalties will not significantly change. In addition to further evaluating each of our licensing agreements, we are in the process of assessing whether any sales promotions or discounts we currently offer related to our Shack sales could be considered separate performance obligations. As we continue our evaluation, we will further clarify the expected impact of the adoption of the standard.

We plan to adopt the standard on December 28, 2017, and we have not yet selected a transition method.

December 28, 2017

FAIR VALUE MEASUREMENTS (Tables)
Schedule of Cash and Cash Equivalents 
The following tables summarize our cash, cash equivalents and marketable securities by significant investment categories as of December 28, 2016 and December 30, 2015:
 
 
December 28, 2016
 
 
Cost Basis

 
 Gross Unrealized Gains

 
 Gross Unrealized Losses

 
 Fair Value

 
 Cash and Cash Equivalents

 
Marketable Securities

Cash
$
6,322

 
$
—

 
$
—

 
$
6,322

 
$
6,322

 
$
—

Level 1:
 
 
 
 
 
 
 
 
 
 
 
 
Money market funds
5,285

 
—

 
—

 
5,285

 
5,285

 
—

 
Mutual funds
60,232

 
—

 
—

 
60,232

 
—

 
60,232

Level 2:
 
 
 
 
 
 
 
 
 
 
 
 
Corporate debt securities(1)
2,473

 
3

 
(30
)
 
2,446

 
—

 
2,446

Total
$
74,312

 
$
3

 
$
(30
)
 
$
74,285

 
$
11,607

 
$
62,678


 
 
December 30, 2015
 
 
Cost Basis

 
 Gross Unrealized Gains

 
 Gross Unrealized Losses

 
 Fair Value

 
 Cash and Cash Equivalents

 
Marketable Securities

Cash
$
70,816

 
$
—

 
$
—

 
$
70,816

 
$
70,816

 
$
—

Level 1:
 
 
 
 
 
 
 
 
 
 
 
 
Money market funds
33

 
—

 
—

 
33

 
33

 
—

Level 2:
 
 
 
 
 
 
 
 
 
 
 
 
Corporate debt securities(1)
2,397

 
1

 
(12
)
 
2,386

 
—

 
2,386

Total
$
73,246

 
$
1

 
$
(12
)
 
$
73,235

 
$
70,849

 
$
2,386


(1)
The fair value of marketable securities with contractual maturity dates within one year are included in marketable securities and those with contractual maturity dates greater than one year are included in other assets on the Consolidated Balance Sheets. Corporate debt securities were measured at fair value using a market approach utilizing observable prices for identical securities or securities with similar characteristics and inputs that are observable or can be corroborated by observable market data.
Schedule of Unrealized Loss on Investments 
The following tables summarize the gross unrealized losses and fair values for those investments that were in an unrealized loss position as of December 28, 2016 and December 30, 2015, aggregated by investment category and the length of time that individual securities have been in a continuous loss position:
 
 
December 28, 2016
 
 
 
Less than 12 Months
 
 
12 Months or Greater
 
 
Total
 
 
Fair Value

 
Unrealized Loss

 
Fair Value

 
Unrealized Loss

 
Fair Value

 
Unrealized Loss

 
Money market funds
$
—

 
$
—

 
$
—

 
$
—

 
$
—

 
$
—

 
Mutual funds
—

 
—

 
—

 
—

 
—

 
—

 
Corporate debt securities
1,244

 
(10
)
 
540

 
(20
)
 
1,784

 
(30
)
Total
$
1,244

 
$
(10
)
 
$
540

 
$
(20
)
 
$
1,784

 
$
(30
)
 
 
December 30, 2015
 
 
 
Less than 12 Months
 
 
12 Months or Greater
 
 
Total
 
 
Fair Value

 
Unrealized Loss

 
Fair Value

 
Unrealized Loss

 
Fair Value

 
Unrealized Loss

 
Money market funds
$
—

 
$
—

 
$
—

 
$
—

 
$
—

 
$
—

 
Corporate debt securities
2,397

 
(12
)
 
—

 
—

 
2,397

 
(12
)
Total
$
2,397

 
$
(12
)
 
$
—

 
$
—

 
$
2,397

 
$
(12
)
Schedule of Gain (Loss) on Investments 
A summary of other income from available-for-sale securities recognized during fiscal 2016, 2015 and 2014 is as follows:
 
2016

 
2015

 
2014

Available-for-sale securities:
 
 
 
 
 
 
Dividend income
$
296

 
$
—

 
$
—

 
Interest income
88

 
7

 
—

 
Loss on investments
(7
)
 
—

 
—

Total other income, net
$
377

 
$
7

 
$
—

Schedule of Realized Gain (Loss) 
A summary of available-for-sale securities sold and gross realized gains and losses recognized during fiscal 2016 is as follows:
 
2016

Available-for-sale securities:
 
 
Gross proceeds from sales and redemptions
$
938

 
Cost basis of sales and redemptions
956

 
Gross realized gains included in net income
2

 
Gross realized losses included in net income
(20
)
 
Amounts reclassified out of accumulated other comprehensive loss
19

Schedule of Investments Classified by Contractual maturity Dates 
The following table summarizes the estimated fair value of our investments in marketable debt securities, accounted for as available-for-sale securities and classified by the contractual maturity date of the securities:
 
December 28
2016

Due within one year
$
1,807

Due after one year through 5 years
639

Due after 5 years through 10 years
—

Due after 10 years
—

Total
$
2,446

ACCOUNTS RECEIVABLE (Tables)
Schedule of Accounts Receivable
The components of accounts receivable as of December 28, 2016 and December 30, 2015 are as follows:
 
December 28
2016

 
December 30
2015

Landlord receivables
$
2,606

 
$
1,380

Licensing receivables
1,278

 
1,669

Credit card receivables
1,589

 
1,023

Other receivables
533

 
145

Accounts receivable
$
6,006

 
$
4,217

INVENTORIES (Tables)
Inventories
Inventories consisted of the following:
 
December 28
2016

 
December 30
2015

Food
$
543

 
$
328

Wine
47

 
30

Beer
58

 
46

Beverages
79

 
57

Retail merchandise
79

 
82

Inventories
$
806

 
$
543

PROPERTY AND EQUIPMENT (Tables)
Property, Plant and Equipment
Property and equipment consisted of the following:
 
December 28
2016

 
December 30
2015

Leasehold improvements
$
120,629

 
$
82,904

Equipment
23,194

 
16,903

Furniture and fixtures
7,342

 
4,965

Computer equipment and software
8,710

 
5,197

Construction in progress (includes assets under construction from deemed landlord financing)
13,510

 
6,591

Property and equipment, gross
173,385

 
116,560

Less: accumulated depreciation
(37,121
)
 
(23,519
)
Property and equipment, net
$
136,264

 
$
93,041

SUPPLEMENTAL BALANCE SHEET INFORMATION (Tables)
Components of Other Current Liabilities
The components of other current liabilities as of December 28, 2016 and December 30, 2015 are as follows:
 
December 28
2016

 
December 30
2015

Sales tax payable
$
1,324

 
$
1,073

Current portion of liabilities under tax receivable agreement
4,580

 
2,157

Gift card liability
1,153

 
833

Other
3,116

 
551

Other current liabilities
$
10,173

 
$
4,614

LEASES (Tables)
Schedule of Rent Expense 
A summary of rent expense under operating lease agreements is as follows:
 
 
2016

 
2015

 
2014

Minimum rent
$
15,408

 
$
10,796

 
$
6,497

Deferred rent
2,122

 
1,482

 
2,830

Contingent rent
4,294

 
2,959

 
1,883

Total rent expense
$
21,824

 
$
15,237

 
$
11,210

Schedule of Future Minimum Rental Payments for Operating Leases 
As of December 28, 2016, future minimum lease payments under non-cancelable operating leases and lease financing arrangements consisted of the following:
 
Operating
Leases

 
Deemed Landlord Financing(1)

2017
$
20,688

 
$
612

2018
21,872

 
1,484

2019
22,173

 
1,614

2020
21,766

 
1,642

2021
21,965

 
1,670

Thereafter
123,372

 
11,175

Total minimum lease payments
$
231,836

 
$
18,197


(1)
Amounts include minimum lease payments for eight leases under construction as of December 28, 2016 where we are deemed the accounting owner. Final classification of lease payments under deemed landlord financing is subject to change pending sale lease-back analysis performed at the store opening date.
NON-CONTROLLING INTERESTS (Tables)
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest [Table Text Block] 
The following table summarizes the ownership interest in SSE Holdings as of December 28, 2016 and December 30, 2015:
 
2016
 
 
2015
 
 
LLC Interests

 
Ownership %

 
LLC Interests

 
Ownership %

Number of LLC Interests held by Shake Shack Inc.
25,151,384

 
69.1
%
 
19,789,259

 
54.6
%
Number of LLC Interests held by non-controlling interest holders
11,253,592

 
30.9
%
 
16,460,741

 
45.4
%
Total LLC Interests outstanding
36,404,976

 
100.0
%
 
36,250,000

 
100.0
%
Schedule of non-controlling interest 
The following table summarizes the effects of changes in ownership in SSE Holdings on our equity during fiscal 2016, 2015 and 2014.
 
2016

 
2015

 
2014

Net income (loss) attributable to Shake Shack Inc.
$
12,446

 
$
(8,776
)
 
$
2,118

Other comprehensive loss:
 
 
 
 
 
 
Unrealized holding losses on available-for-sale securities
(10
)
 
(5
)
 
—

Transfers (to) from non-controlling interests:
 
 
 
 
 
 
Increase in additional paid-in capital as a result of settlement of unit appreciation rights
—

 
987

 
—

 
Decrease in additional paid-in capital as a result of the organizational transactions completed in connection with our IPO
—

 
(75,182
)
 
—

 
Increase in additional paid-in capital as a result of the redemption of LLC Interests
16,986

 
19,934

 
—

 
Increase in additional paid-in capital as a result of the USC Merger
—

 
5,908

 
—

 
Increase in additional paid-in capital as a result of stock option exercises and the related income tax effect
825

 
—

 
—

Total effect of changes in ownership interest on equity attributable to Shake Shack Inc.
$
30,247

 
$
(57,134
)
 
$
2,118

EQUITY-BASED COMPENSATION (Tables)
Schedule of Nonvested Share Activity [Table Text Block] 
A summary of unvested stock option activity for fiscal 2015 and 2016 is as follows:
 
 
Stock
Options

 
Weighted
Average
Grant-Date Fair Value

Unvested as of December 31, 2014
—

 
$
—

 
Vested
—

 
—

 
Granted
2,622,281

 
8.53

 
Forfeited
(47,300
)
 
8.59

Unvested as of December 30, 2015
2,574,981

 
$
8.53

 
Vested
(562,296
)
 
8.32

 
Granted
16,931

 
16.32

 
Forfeited
(65,365
)
 
8.59

Unvested as of December 28, 2016
1,964,251

 
$
8.66

Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested and Expected to Vest, Outstanding and Exercisable [Table Text Block] 
The following table summarizes information about stock options outstanding and exercisable as December 28, 2016:
 
 
Options Outstanding
 
 
Options Exercisable
 
 
 
Number Outstanding at December 28, 2016

 
Weighted Average Remaining Contractual Life (Years)
 
Weighted Average Exercise Price

 
Number Exercisable at December 28, 2016

 
Weighted Average Remaining Contractual Life (Years)

 
Weighted Average Exercise Price

Exercise Price
 
 
 
 
 
 
$21.00
 
2,347,791

 
8.1
 
$
21.00

 
400,471

 
8.1

 
$
21.00

$34.62
 
15,823

 
9.4
 
$
34.62

 
—

 
—

 
$
—

$36.41
 
1,108

 
9.9
 
$
36.41

 
—

 
—

 
$
—

Schedule of equity-based compensation expense recognized 
A summary of equity-based compensation expense recognized during fiscal 2016, 2015 and 2014 is as follows:
 
 
2016

 
2015

 
2014

Unit appreciation rights
$
—

 
$
11,762

 
$
—

Restricted Class B units
—

 
605

 
165

Stock options
4,262

 
4,314

 
—

Performance stock units
1,092

 
—

 
—

Equity-based compensation expense
$
5,354

 
$
16,681

 
$
165

 
 
 
 
 
 
Total income tax benefit recognized related to equity-based compensation
$
168

 
$
482

 
$
4

Schedule of unit appreciation rights activity 
.
Schedule of restricted class B activity 
.
Schedule of fair value of stock options 
The fair value of stock option awards was determined on the grant date using the Black-Scholes valuation model based on the following weighted-average assumptions:
 
2016

 
2015

Expected term (years)(1)
5.5

 
7.5

Expected volatility(2)
50.7
%
 
35.1
%
Risk-free interest rate(3)
1.5
%
 
1.6
%
Dividend yield(4)
—
%
 
—
%
(1)
Expected term represents the estimated period of time until an award is exercised and was determined using the simplified method.
(2)
Expected volatility is based on the historical volatility of a selected peer group over a period equivalent to the expected term.
(3)
The risk-free rate rate is an interpolation of yields on U.S. Treasury securities with maturities equivalent to the expected term.
(4)
We have assumed a dividend yield of zero as we have no plans to declare dividends in the foreseeable future.
Schedule of stock options, activity 
A summary of stock option activity for fiscal years 2015 and 2016 is as follows:
 
 
Stock
Options

 
Weighted
Average
Exercise
Price

 
Aggregate Intrinsic Value

 
Weighted Average Remaining Contractual Life (Years)
Outstanding as of December 31, 2014
—

 
$
—

 

 

 
Granted
2,622,281

 
21.00

 

 

 
Exercised
—

 
—

 

 

 
Forfeited
(47,300
)
 
(21.00
)
 

 

 
Expired
—

 
—

 

 

Outstanding as of December 30, 2015
2,574,981

 
$
21.00

 

 

 
Granted
16,931

 
34.74

 

 

 
Exercised
(160,230
)
 
21.00

 

 

 
Forfeited
(66,960
)
 
(21.00
)
 

 

 
Expired
—

 
—

 

 

Outstanding as of December 28, 2016
2,364,722

 
$
21.10

 
$
37,201

 
8.1
Options vested and exercisable as of December 28, 2016
400,471

 
$
21.00

 
$
6,339

 
8.1
Options expected to vest as of December 28, 2016
1,847,242

 
$
21.13

 
$
29,009

 
8.1
Schedule of stock options outstanding and exercisable option plans 
The following table summarizes information about stock options outstanding and exercisable as December 28, 2016:
 
 
Options Outstanding
 
 
Options Exercisable
 
 
 
Number Outstanding at December 28, 2016

 
Weighted Average Remaining Contractual Life (Years)
 
Weighted Average Exercise Price

 
Number Exercisable at December 28, 2016

 
Weighted Average Remaining Contractual Life (Years)

 
Weighted Average Exercise Price

Exercise Price
 
 
 
 
 
 
$21.00
 
2,347,791

 
8.1
 
$
21.00

 
400,471

 
8.1

 
$
21.00

$34.62
 
15,823

 
9.4
 
$
34.62

 
—

 
—

 
$
—

$36.41
 
1,108

 
9.9
 
$
36.41

 
—

 
—

 
$
—


Performance Stock Units
Under the 2015 Plan, we may grant performance stock units and other types of performance-based equity awards that vest based on the outcome of certain performance criteria that are established and approved by the Compensation Committee of the Board of Directors. The actual number of equity awards earned is based on the level of performance achieved over a predetermined performance period, relative to established financial goals, none of which are considered market conditions.
For performance stock units granted during fiscal 2016, the amount of awards that can be earned range from 0% to 125% of the number of performance stock units granted, based on the achievement of approved financial goals over a one-year performance period. In addition to the performance conditions, performance stock units are also subject to a requisite service period and the awards will vest ratably over three years. The fair value of performance stock units is determined based on the closing market price of our Class A common stock on the date of grant. Compensation expense related to the performance stock units is recognized using a graded-vesting attribution method over the vesting period based on the most probable outcome of the performance conditions.
A summary of performance stock unit activity for fiscal 2016 is as follows:
 
 
Performance
Stock
Units

 
Weighted
Average
Grant Date Fair Value

Outstanding at beginning of period
—

 
$
—

 
Granted
63,600

 
38.41

 
Vested
—

 
—

 
Forfeited
(2,000
)
 
38.43

 
Expired
—

 
—

Outstanding at end of period
61,600

 
$
38.41

INCOME TAXES (Tables)
Schedule of Income before Income Tax, Domestic and Foreign 
The components of income before income taxes are follows:
 
2016

 
2015

 
2014

Domestic
$
20,623

 
$
244

 
$
(3,007
)
Foreign
7,873

 
6,184

 
5,787

Income before income taxes
$
28,496

 
$
6,428

 
$
2,780

Schedule of Components of Income Tax Expense 
The components of income tax expense are as follows:
 
 
 
2016

 
2015

 
2014

Current income taxes:
 
 
 
 
 
 
Federal
$
3,767

 
$
2,474

 
$
—

 
State and local
2,439

 
1,131

 
194

 
Foreign
667

 
433

 
561

 
Total current income taxes
6,873

 
4,038

 
755

Deferred income taxes:
 
 
 
 
 
 
Federal
(48
)
 
(267
)
 
—

 
State and local
(475
)
 
(467
)
 
(93
)
 
Total deferred income taxes
(523
)
 
(734
)
 
(93
)
Income tax expense
$
6,350

 
$
3,304

 
$
662

Reconciliation of income tax expense, US income tax rate 
econciliations of income tax expense computed at the U.S. federal statutory income tax rate to the recognized income tax expense and the U.S. statutory income tax rate to our effective tax rates are as follows:
 
 
2016
 
 
2015
 
 
2014
 
Expected U.S. federal income taxes at statutory rate
$
9,689

34.0
 %
 
$
2,186

34.0
 %
 
$
945

34.0
 %
State and local income taxes, net of federal benefit
1,461

5.1
 %
 
663

10.3
 %
 
101

3.6
 %
Foreign withholding taxes
667

2.3
 %
 
433

6.7
 %
 
561

20.2
 %
Non-deductible expenses
25

0.1
 %
 
653

10.2
 %
 
—

—
 %
Tax credits
(779
)
(2.7
)%
 
(141
)
(2.2
)%
 
—

—
 %
Rate change impact
(1,353
)
(4.7
)%
 
—

—
 %
 
—

—
 %
Non-controlling interest
(3,765
)
(13.2
)%
 
(490
)
(7.6
)%
 
—

—
 %
LLC flow-through structure
—

—
 %
 
—

—
 %
 
(976
)
(35.1
)%
Other
405

1.4
 %
 
—

—
 %
 
31

1.1
 %
Income tax expense
$
6,350

22.3
 %
 
$
3,304

51.4
 %
 
$
662

23.8
 %
Schedule of Deferred Tax Assets and Liabilities 
The components of deferred tax assets and liabilities are as follows:
 
 
 
December 28
2016

 
December 30
2015

Deferred tax assets:
 
 
 
 
Investment in partnership
$
209,648

 
$
154,649

 
Tax Receivable Agreement
110,022

 
69,513

 
Deferred rent
561

 
492

 
Deferred revenue
53

 
63

 
Stock-based compensation
331

 
218

 
Net operating loss carryforwards
7,338

 
334

 
Tax credits
1,084

 
—

 
Other assets
108

 
159

 
Total gross deferred tax assets
329,145

 
225,428

Valuation allowance
(15,568
)
 
(23,155
)
Total deferred tax assets, net of valuation allowance
313,577

 
202,273

Deferred tax liabilities:
 
 
 
 
Property and equipment
(370
)
 
(316
)
 
Total gross deferred tax liabilities
(370
)
 
(316
)
Net deferred tax assets
$
313,207

 
$
201,957

EARNINGS PER SHARE (Tables)
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share [Table Text Block] 
The following table presents potentially dilutive securities excluded from the computations of diluted earnings per share of Class A common stock for fiscal 2016, 2015 and 2014.
 
 
 
2016
 
2015
 
2014
Stock options
125

(1)
 
2,574,981

(2)
 
—

 
Performance stock units
26,860

(3)
 
—

 
 
—

 
Shares of Class B common stock
11,253,592

(4)
 
16,460,741

(4)
 
—

 
(1)
Weighted-average number of securities excluded from the computation of diluted earnings per share of Class A common stock because the exercise price of the stock options exceeded the average market price.
(2)
Excluded from the computation of diluted earnings per share of Class A common stock because the effect would have been anti-dilutive.
(3)
Weighted-average number of securities excluded from the computation of diluted earnings per share of Class A common stock because the performance conditions were not met for a portion of the fiscal year.
(4)
Shares of our Class B common stock are considered potentially dilutive shares of Class A common stock. Amounts have been excluded from the computations of diluted earnings per share of Class A common stock because the effect would have been anti-dilutive under the if-converted and two-class methods.
The following table presents potentially dilutive securities excluded from the computations of diluted earnings per share of Class A common stock for fiscal 2016, 2015 and 2014.
 
 
 
2016
 
2015
 
2014
Stock options
125

(1)
 
2,574,981

(2)
 
—

 
Performance stock units
26,860

(3)
 
—

 
 
—

 
Shares of Class B common stock
11,253,592

(4)
 
16,460,741

(4)
 
—

 
(1)
Weighted-average number of securities excluded from the computation of diluted earnings per share of Class A common stock because the exercise price of the stock options exceeded the average market price.
(2)
Excluded from the computation of diluted earnings per share of Class A common stock because the effect would have been anti-dilutive.
(3)
Weighted-average number of securities excluded from the computation of diluted earnings per share of Class A common stock because the performance conditions were not met for a portion of the fiscal year.
(4)
Shares of our Class B common stock are considered potentially dilutive shares of Class A common stock. Amounts have been excluded from the computations of diluted earnings per share of Class A common stock because the effect would have been anti-dilutive under the if-converted and two-class methods.
Schedule of earnings per share 
The following table sets forth reconciliations of the numerators and denominators used to compute basic and diluted earnings per share of Class A common stock for fiscal 2016, 2015 and 2014.
 
 
 
2016

 
2015

 
2014

Numerator:
 
 
 
 
 
 
Net income
$
22,146

 
$
3,124

 
$
2,118

 
Less: net income attributable to non-controlling interests
9,700

 
11,900

 
—

 
Net income (loss) attributable to Shake Shack Inc.
$
12,446

 
$
(8,776
)
 
$
2,118

Denominator:
 
 
 
 
 
 
Weighted-average shares of Class A common stock outstanding—basic
22,956

 
13,588

 
29,977

 
Effect of dilutive securities:
 
 
 
 
 
 
 
Restricted Class B units
—

 
—

 
145

 
 
Stock options
493

 
—

 
—

 
Weighted-average shares of Class A common stock outstanding—diluted
23,449

 
13,588

 
30,122

 
 
 
 
 
 
 
 
Earnings per share of Class A common stock—basic
$
0.54

 
$
(0.65
)
 
$
0.07

Earnings per share of Class A common stock—diluted
$
0.53

 
$
(0.65
)
 
$
0.07

SUPPLEMENTAL CASH FLOW INFORMATION (Tables)
Schedule of Cash Flow Information
The following table sets forth supplemental cash flow information for fiscal 2016, 2015 and 2014:
 
 
2016

 
2015

 
2014

Cash paid for:
 
 
 
 
 
 
Income taxes, net of refunds
$
1,823

 
$
416

 
$
836

 
Interest, net of amounts capitalized
54

 
92

 
123

Non-cash investing activities:
 
 
 
 
 
 
Accrued purchases of property and equipment
6,150

 
4,904

 
3,577

 
Property and equipment acquired through landlord incentives
—

 
—

 
6,000

 
Capitalized landlord assets for leases where we are deemed the accounting owner
1,985

 
—

 
—

 
Capitalized equity-based compensation
139

 
—

 
—

 
Class A common stock issued in connection with the acquisition of the former indirect members of SSE Holdings
—

 
6

 
—

 
Class A common stock issued in connection with the USC Merger
—

 
2

 
—

Non-cash financing activities:
 
 
 
 
 
 
Cancellation of Class B common stock in connection with the Organizational Transactions
—

 
(6
)
 
—

 
Class A common stock issued in connection with the redemption of LLC Interests
5

 
6

 
—

 
Cancellation of Class B common stock in connection with the redemption of LLC Interests
(5
)
 
(6
)
 
—

 
Cancellation of Class B common stock in connection with the USC Merger
—

 
(2
)
 
—

 
Establishment of liabilities under tax receivable agreement
100,063

 
173,090

 
—

 
Accrued distributions payable to non-controlling interest holders
607

 
—

 
—

GEOGRAPHIC INFORMATION (Tables)
Revenue from Customers by Geographic Areas
Revenue by geographic area for fiscal 2016, 2015 and 2014 is as follows:
 
 
2016

 
2015

 
2014

United States
$
260,602

 
$
184,408

 
$
112,743

Other countries
7,873

 
6,184

 
5,787

Total revenue
$
268,475

 
$
190,592

 
$
118,530

SELECTED QUARTERLY FINANCIAL DATA (UNAUDITED) (Tables)
Schedule of Quarterly Financial Information
The following table sets forth certain unaudited financial information for each quarter of fiscal 2016 and 2015. The unaudited quarterly information includes all adjustments (consisting of normal recurring adjustments) that, in the opinion of management, are necessary for the fair presentation of the information presented. Operating results for interim periods are not necessarily indicative of the results that may be expected for a full fiscal year.
 
 
 
2016
 
 
 
 
First

 
Second

 
Third

 
Fourth

 
 
 
Quarter

 
Quarter

 
Quarter

 
Quarter

Total revenue
$
54,165

 
$
66,472

 
$
74,567

 
$
73,271

Operating income
4,714

 
8,933

 
9,170

 
4,988

Net income
3,351

 
6,549

 
6,789

 
5,457

Net income attributable to Shake Shack Inc.
1,462

 
3,298

 
3,766

 
3,920

Earnings per share(1):
 
 
 
 
 
 
 
 
Basic
$
0.07

 
$
0.15

 
$
0.16

 
$
0.16

 
Diluted
$
0.07

 
$
0.14

 
$
0.15

 
$
0.15


 
 
 
2015
 
 
 
 
First

 
Second

 
Third

 
Fourth

 
 
 
Quarter

 
Quarter

 
Quarter

 
Quarter

Total revenue
$
37,808

 
$
48,450

 
$
53,273

 
$
51,061

Operating income (loss)
(10,949
)
 
6,244

 
7,804

 
3,654

Net income (loss)
(11,260
)
 
5,145

 
6,193

 
3,046

Net income (loss) attributable to Shake Shack Inc.
(12,668
)
 
1,118

 
1,528

 
1,246

Earnings (loss) per share(1):
 
 
 
 
 
 
 
 
Basic
$
(1.06
)
 
$
0.09

 
$
0.11

 
$
0.08

 
Diluted
$
(1.06
)
 
$
0.08

 
$
0.10

 
$
0.07

(1)
Basic and diluted earnings per share are computed independently for each of the quarters presented. Therefore, the sum of quarterly basic and diluted earnings per share amounts may not equal annual basic and diluted earnings per share amounts.

NATURE OF OPERATIONS - Organization and Nature of Operations - Franchiser (Details)
Dec. 28, 2016
Restaurant
Franchisor Disclosure [Line Items]
 
Number of Restaurants
114 
Company-operated |
United States
 
Franchisor Disclosure [Line Items]
 
Number of Restaurants
64 
Licensed |
United States
 
Franchisor Disclosure [Line Items]
 
Number of Restaurants
7 
Licensed |
Other countries
 
Franchisor Disclosure [Line Items]
 
Number of Restaurants
43 
NATURE OF OPERATIONS - Initial Public Offering (Details) (Common stock, Class A Common Stock, USD $)
In Thousands, except Share data, unless otherwise specified
0 Months Ended 11 Months Ended
Feb. 4, 2015
Dec. 30, 2015
Class of Stock [Line Items]
 
 
Shares issued during the period
5,968,841 
5,750,000 
IPO
 
 
Class of Stock [Line Items]
 
 
Shares issued during the period
5,750,000 
 
Proceeds of issuance of initial public offering net of underwriting discounts and commissions
$ 112,298 
 
Over-allotment option
 
 
Class of Stock [Line Items]
 
 
Shares issued during the period
750,000 
 
NATURE OF OPERATIONS - Organizational Transactions (Details)
0 Months Ended 4 Months Ended 12 Months Ended 0 Months Ended 11 Months Ended 0 Months Ended 4 Months Ended 12 Months Ended
Feb. 4, 2015
business
Feb. 4, 2015
entity
Dec. 30, 2015
Dec. 28, 2016
Dec. 30, 2015
Feb. 4, 2015
Feb. 4, 2015
Class A Common Stock
Feb. 4, 2015
Class A Common Stock
Common stock
Dec. 30, 2015
Class A Common Stock
Common stock
Feb. 4, 2015
Class B Common Stock
Feb. 4, 2015
Class B Common Stock
Common stock
Dec. 30, 2015
Class B Common Stock
Common stock
Dec. 28, 2016
Class B Common Stock
Common stock
Class of Stock [Line Items]
 
 
 
 
 
 
 
 
 
 
 
 
 
Ratio of common stock to limited liability company interest
 
 
 
 
 
 
1 
 
 
1 
 
 
 
Number of entities acquired
2 
2 
 
 
 
 
 
 
 
 
 
 
 
Shares issued during the period
 
 
 
 
 
 
 
5,968,841 
5,750,000 
 
30,160,694 
 
 
LLC interests acquired
5,968,841 
5,968,841 
2,848,035 
5,207,149 
6,003,308 
 
 
 
 
 
 
 
 
Effect of redemption (shares)
 
 
 
 
 
 
 
 
 
 
5,968,841 
2,848,035 
5,207,149 
Ownership percent of noncontrolling interest
 
 
54.60% 
69.10% 
54.60% 
33.30% 
 
 
 
 
 
 
 
Noncontrolling owners ownership percentage
 
 
45.40% 
30.90% 
45.40% 
66.70% 
 
 
 
 
 
 
 
NATURE OF OPERATIONS - Secondary Offering (Details) (USD $)
0 Months Ended 4 Months Ended 12 Months Ended 4 Months Ended 12 Months Ended 0 Months Ended 4 Months Ended 12 Months Ended 1 Months Ended 4 Months Ended 12 Months Ended 1 Months Ended
Feb. 4, 2015
Dec. 30, 2015
Dec. 28, 2016
Dec. 30, 2015
Feb. 4, 2015
Dec. 30, 2015
Class A Common Stock
Common stock
Dec. 28, 2016
Class A Common Stock
Common stock
Feb. 4, 2015
Class B Common Stock
Common stock
Dec. 30, 2015
Class B Common Stock
Common stock
Dec. 28, 2016
Class B Common Stock
Common stock
Aug. 31, 2015
Secondary offering
Aug. 31, 2015
Secondary offering
Class A Common Stock
Common stock
Aug. 31, 2015
Secondary offering
Class B Common Stock
Common stock
Dec. 30, 2015
Limited Liability Company
Dec. 28, 2016
Limited Liability Company
Aug. 31, 2015
Limited Liability Company
Secondary offering
Class of Stock [Line Items]
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total shares offered
 
 
 
 
 
 
 
 
 
 
 
4,000,000 
 
 
 
 
Shares issued, share price (in dollars per share)
 
 
 
 
 
 
 
 
 
 
 
$ 60 
 
 
 
 
Units acquired during the period (shares)
5,968,841 
2,848,035 
5,207,149 
6,003,308 
 
 
 
 
 
 
3,155,273 
 
 
 
 
 
Conversion of units from former equity owners (shares)
 
 
 
 
 
 
 
 
 
 
 
844,727 
 
 
 
 
Redemptions (shares)
 
 
 
 
 
2,848,035 
5,207,149 
 
 
 
 
3,155,273 
 
 
 
 
Number of units redeemed (shares)
 
 
 
 
 
 
 
 
 
 
 
 
 
2,848,035 
5,207,149 
3,155,273 
Effect of redemption (shares)
 
 
 
 
 
 
 
5,968,841 
2,848,035 
5,207,149 
 
 
3,155,273 
 
 
 
Ownership percent of noncontrolling interest
 
54.60% 
69.10% 
54.60% 
33.30% 
 
 
 
 
 
 
 
 
 
 
 
Noncontrolling owners ownership percentage
 
45.40% 
30.90% 
45.40% 
66.70% 
 
 
 
 
 
 
 
 
 
 
 
NATURE OF OPERATIONS - Redemption (Details)
0 Months Ended 4 Months Ended 12 Months Ended 0 Months Ended 11 Months Ended 0 Months Ended 4 Months Ended 12 Months Ended 1 Months Ended
Feb. 4, 2015
Dec. 30, 2015
Dec. 28, 2016
Dec. 30, 2015
Feb. 4, 2015
Class A Common Stock
Common stock
Dec. 30, 2015
Class A Common Stock
Common stock
Feb. 4, 2015
Class B Common Stock
Common stock
Dec. 30, 2015
Class B Common Stock
Common stock
Dec. 28, 2016
Class B Common Stock
Common stock
Dec. 30, 2015
USC Merger
Dec. 30, 2015
USC Merger
Class A Common Stock
Common stock
Dec. 30, 2015
USC Merger
Class B Common Stock
Common stock
Class of Stock [Line Items]
 
 
 
 
 
 
 
 
 
 
 
 
Shares issued during the period
 
 
 
 
5,968,841 
5,750,000 
30,160,694 
 
 
 
1,727,804 
 
Effect of redemption (shares)
 
 
 
 
 
 
5,968,841 
2,848,035 
5,207,149 
 
 
1,727,804 
Units acquired during the period (shares)
5,968,841 
2,848,035 
5,207,149 
6,003,308 
 
 
 
 
 
1,727,804 
 
 
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Basis of Presentation (Details) (Variable Interest Entity, Primary Beneficiary, USD $)
In Thousands, unless otherwise specified
Dec. 28, 2016
Dec. 30, 2015
Variable Interest Entity, Primary Beneficiary
 
 
Variable Interest Entity [Line Items]
 
 
Net assets of SSE Holdings
$ 158,845 
$ 124,214 
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Fiscal Year (Details)
12 Months Ended
Dec. 28, 2016
Dec. 30, 2015
Dec. 31, 2014
Accounting Policies [Abstract]
 
 
 
Fiscal period duration
364 days 
364 days 
371 days 
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Segment Reporting (Details)
12 Months Ended
Dec. 28, 2016
reportable_segment
operating_segment
Accounting Policies [Abstract]
 
Number of operating segments
1 
Number of reportable segments
1 
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Property and Equipment (Details) (USD $)
12 Months Ended
Dec. 28, 2016
Dec. 30, 2015
Dec. 31, 2014
Property, Plant and Equipment [Line Items]
 
 
 
Impairment charges
$ 0 
$ 0 
$ 0 
Equipment |
Minimum
 
 
 
Property, Plant and Equipment [Line Items]
 
 
 
Useful life of asset
3 years 
 
 
Equipment |
Maximum
 
 
 
Property, Plant and Equipment [Line Items]
 
 
 
Useful life of asset
7 years 
 
 
Furniture and fixtures |
Minimum
 
 
 
Property, Plant and Equipment [Line Items]
 
 
 
Useful life of asset
3 years 
 
 
Furniture and fixtures |
Maximum
 
 
 
Property, Plant and Equipment [Line Items]
 
 
 
Useful life of asset
7 years 
 
 
Computer equipment and software |
Minimum
 
 
 
Property, Plant and Equipment [Line Items]
 
 
 
Useful life of asset
3 years 
 
 
Computer equipment and software |
Maximum
 
 
 
Property, Plant and Equipment [Line Items]
 
 
 
Useful life of asset
7 years 
 
 
Leasehold improvements |
Minimum
 
 
 
Property, Plant and Equipment [Line Items]
 
 
 
Useful life of asset
10 years 
 
 
Leasehold improvements |
Maximum
 
 
 
Property, Plant and Equipment [Line Items]
 
 
 
Useful life of asset
20 years 
 
 
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Other Assets (Details) (USD $)
In Thousands, unless otherwise specified
Dec. 28, 2016
Dec. 30, 2015
Accounting Policies [Abstract]
 
 
Indefinite-lived intangible assets
$ 701 
$ 701 
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Leases (Details)
3 Months Ended 12 Months Ended
Apr. 1, 2015
Dec. 28, 2016
renewal_option
Operating Leased Assets [Line Items]
 
 
Number of sale leaseback transactions
0 
8 
Number of renewal options
 
2 
Period of renewal term
 
5 years 
Minimum
 
 
Operating Leased Assets [Line Items]
 
 
Terms of lease contract
 
10 years 
Maximum
 
 
Operating Leased Assets [Line Items]
 
 
Terms of lease contract
 
20 years 
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Income Taxes (Details) (USD $)
Dec. 28, 2016
Dec. 30, 2015
Dec. 31, 2014
Accounting Policies [Abstract]
 
 
 
Valuation allowance
$ 15,568,000 
$ 23,155,000 
$ 0 
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Advertising (Details) (USD $)
In Thousands, unless otherwise specified
12 Months Ended
Dec. 28, 2016
Dec. 30, 2015
Dec. 31, 2014
Accounting Policies [Abstract]
 
 
 
Advertising and promotions
$ 147 
$ 149 
$ 87 
FAIR VALUE MEASUREMENTS - Cash, Cash Equivalents and Marketable Securities (Details) (USD $)
12 Months Ended
Dec. 28, 2016
Dec. 30, 2015
Dec. 31, 2014
Dec. 25, 2013
Dec. 26, 2012
Schedule of Available-for-sale Securities [Line Items]
 
 
 
 
 
Gross proceeds from sales and redemptions
$ 938,000 
$ 0 
$ 0 
 
 
Dividend income
296,000 
0 
0 
 
 
Interest income
88,000 
7,000 
0 
 
 
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than Twelve Months, Fair Value
1,244,000 
2,397,000 
 
 
 
Cash cost basis
11,607,000 
70,849,000 
 
2,677,000 
13,076,000 
Cash and cash equivalents fair value
11,607,000 
70,849,000 
 
 
 
Gross Unrealized Gains
3,000 
1,000 
 
 
 
Gross Unrealized Losses
(30,000)
(12,000)
 
 
 
Fair value of marketable securities
62,678,000 
2,386,000 
 
 
 
Total cost basis
74,312,000 
73,246,000 
 
 
 
Total fair value
74,285,000 
73,235,000 
 
 
 
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than 12 Months, Accumulated Loss
(10,000)
(12,000)
 
 
 
Available-for-sale Securities, Continuous Unrealized Loss Position, Twelve Months or Longer, Fair Value
540,000 
0 
 
 
 
Available-for-sale Securities, Continuous Unrealized Loss Position, 12 Months or Longer, Accumulated Loss
(20,000)
0 
 
 
 
Available-for-sale Securities, Continuous Unrealized Loss Position, Fair Value
1,784,000 
2,397,000 
 
 
 
Available-for-sale Securities, Continuous Unrealized Loss Position, Accumulated Loss
(30,000)
(12,000)
 
 
 
Marketable Securities, Realized Gain (Loss)
(7,000)
0 
0 
 
 
Available-for-sale Securities, Gross Realized Gain (Loss)
377,000 
7,000 
0 
 
 
Available-for-sale Securities, Amortized Cost Basis, Securities Sold
956,000 
 
 
 
 
Available-for-sale Securities, Gross Realized Gains
2,000 
 
 
 
 
Available-for-sale Securities, Gross Realized Losses
(20,000)
 
 
 
 
Other Comprehensive Income (Loss), Reclassification Adjustment from AOCI for Sale of Securities, Net of Tax
19,000 1
0 1
0 1
 
 
Corporate debt securities
 
 
 
 
 
Schedule of Available-for-sale Securities [Line Items]
 
 
 
 
 
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than Twelve Months, Fair Value
1,244,000 
2,397,000 
 
 
 
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than 12 Months, Accumulated Loss
(10,000)
(12,000)
 
 
 
Available-for-sale Securities, Continuous Unrealized Loss Position, Twelve Months or Longer, Fair Value
540,000 
0 
 
 
 
Available-for-sale Securities, Continuous Unrealized Loss Position, 12 Months or Longer, Accumulated Loss
(20,000)
0 
 
 
 
Available-for-sale Securities, Continuous Unrealized Loss Position, Fair Value
1,784,000 
2,397,000 
 
 
 
Available-for-sale Securities, Continuous Unrealized Loss Position, Accumulated Loss
(30,000)
(12,000)
 
 
 
Fair Value, Inputs, Level 1 |
Mutual Fund
 
 
 
 
 
Schedule of Available-for-sale Securities [Line Items]
 
 
 
 
 
Cash cost basis
60,232,000 
 
 
 
 
Fair value of marketable securities
60,232,000 
 
 
 
 
Fair Value, Inputs, Level 2 |
Corporate debt securities
 
 
 
 
 
Schedule of Available-for-sale Securities [Line Items]
 
 
 
 
 
Marketable securities cost Basis
2,473,000 
2,397,000 
 
 
 
Gross Unrealized Gains
3,000 
1,000 
 
 
 
Gross Unrealized Losses
(30,000)
(12,000)
 
 
 
Fair value of marketable securities
2,446,000 
2,386,000 
 
 
 
Cash
 
 
 
 
 
Schedule of Available-for-sale Securities [Line Items]
 
 
 
 
 
Cash cost basis
6,322,000 
70,816,000 
 
 
 
Cash and cash equivalents fair value
6,322,000 
70,816,000 
 
 
 
Money market funds |
Fair Value, Inputs, Level 1
 
 
 
 
 
Schedule of Available-for-sale Securities [Line Items]
 
 
 
 
 
Cash cost basis
5,285,000 
33,000 
 
 
 
Cash and cash equivalents fair value
$ 5,285,000 
$ 33,000 
 
 
 
FAIR VALUE MEASUREMENTS - Additional Information (Details) (USD $)
12 Months Ended
Dec. 28, 2016
Dec. 30, 2015
Dec. 31, 2014
Fair Value Disclosures [Abstract]
 
 
 
Accumulated Other Comprehensive Income (Loss), Unrealized Holding Gain (Loss) on Securities Arising During Period, Net of Tax
$ 27,000 
$ 11,000 
 
Fair Value
62,678,000 
2,386,000 
 
Impairment charges
0 
0 
0 
Interest income
88,000 
7,000 
0 
Realized gains (loss) on available-for-sale securities
377,000 
7,000 
0 
Available-for-sale securities sold
$ 938,000 
$ 0 
$ 0 
FAIR VALUE MEASUREMENTS - Estimated Fair Value of Investments (Details) (USD $)
In Thousands, unless otherwise specified
Dec. 28, 2016
Fair Value Disclosures [Abstract]
 
Due within one year
$ 1,807 
Due after one year through 5 years
639 
Due after 5 years through 10 years
0 
Due after 10 years
0 
Total
$ 2,446 
ACCOUNTS RECEIVABLE (Details) (USD $)
In Thousands, unless otherwise specified
Dec. 28, 2016
Dec. 30, 2015
Receivables [Abstract]
 
 
Landlord receivables
$ 2,606 
$ 1,380 
Licensing receivables
1,278 
1,669 
Credit card receivables
1,589 
1,023 
Other receivables
533 
145 
Accounts receivable
$ 6,006 
$ 4,217 
ACCOUNTS RECEIVABLE - Additional Information (Details) (USD $)
Dec. 28, 2016
Dec. 30, 2015
Receivables [Abstract]
 
 
Allowance for doubtful accounts
$ 0 
$ 0 
INVENTORIES (Details) (USD $)
In Thousands, unless otherwise specified
Dec. 28, 2016
Dec. 30, 2015
Inventory [Line Items]
 
 
Inventories
$ 806 
$ 543 
Food
 
 
Inventory [Line Items]
 
 
Inventories
543 
328 
Wine
 
 
Inventory [Line Items]
 
 
Inventories
47 
30 
Beer
 
 
Inventory [Line Items]
 
 
Inventories
58 
46 
Beverages
 
 
Inventory [Line Items]
 
 
Inventories
79 
57 
Retail merchandise
 
 
Inventory [Line Items]
 
 
Inventories
$ 79 
$ 82 
PROPERTY AND EQUIPMENT (Details) (USD $)
In Thousands, unless otherwise specified
12 Months Ended
Dec. 28, 2016
Dec. 30, 2015
Dec. 31, 2014
Property, Plant and Equipment [Line Items]
 
 
 
Property and equipment, gross
$ 173,385 
$ 116,560 
 
Less: accumulated depreciation
(37,121)
(23,519)
 
Property and equipment, net
136,264 
93,041 
 
Depreciation
14,502 
10,222 
5,809 
Leasehold improvements
 
 
 
Property, Plant and Equipment [Line Items]
 
 
 
Property and equipment, gross
120,629 
82,904 
 
Equipment
 
 
 
Property, Plant and Equipment [Line Items]
 
 
 
Property and equipment, gross
23,194 
16,903 
 
Furniture and fixtures
 
 
 
Property, Plant and Equipment [Line Items]
 
 
 
Property and equipment, gross
7,342 
4,965 
 
Computer equipment and software
 
 
 
Property, Plant and Equipment [Line Items]
 
 
 
Property and equipment, gross
8,710 
5,197 
 
Construction in progress (includes assets under construction from deemed landlord financing)
 
 
 
Property, Plant and Equipment [Line Items]
 
 
 
Property and equipment, gross
$ 13,510 
$ 6,591 
 
SUPPLEMENTAL BALANCE SHEET INFORMATION - (Details) (USD $)
In Thousands, unless otherwise specified
Dec. 28, 2016
Dec. 30, 2015
Supplemental Balance Sheet Disclosures [Abstract]
 
 
Sales tax payable
$ 1,324 
$ 1,073 
Current portion of liabilities under tax receivable agreement
4,580 
2,157 
Gift card liability
1,153 
833 
Other
3,116 
551 
Other current liabilities
$ 10,173 
$ 4,614 
DEBT (Details) (USD $)
12 Months Ended 12 Months Ended 0 Months Ended 1 Months Ended
Dec. 28, 2016
Dec. 30, 2015
Dec. 31, 2014
Dec. 28, 2016
Notes payable
Dec. 30, 2015
Notes payable
Mar. 31, 2013
Notes payable
Dec. 28, 2016
Letter of credit
Feb. 4, 2015
Revolving Credit Facility
Line of credit
Dec. 28, 2016
Revolving Credit Facility
Line of credit
Feb. 4, 2015
Revolving Credit Facility
Line of credit
Dec. 28, 2016
Revolving Credit Facility
Letter of credit
Line of credit
Feb. 4, 2015
Revolving Credit Facility
Letter of credit
Line of credit
May 31, 2016
Revolving Credit Facility
Minimum
Line of credit
London Interbank Offered Rate (LIBOR)
May 31, 2016
Revolving Credit Facility
Minimum
Line of credit
Prime rate
May 31, 2016
Revolving Credit Facility
Maximum
Line of credit
London Interbank Offered Rate (LIBOR)
May 31, 2016
Revolving Credit Facility
Maximum
Line of credit
Prime rate
Debt Instrument [Line Items]
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Maximum borrowing capacity
 
 
 
 
 
 
 
 
 
$ 50,000,000 
 
$ 10,000,000 
 
 
 
 
Current borrowing capacity
 
 
 
 
 
 
 
 
 
20,000,000 
80,000 
 
 
 
 
 
Term to maturity
 
 
 
 
 
 
1 year 
5 years 
 
 
 
 
 
 
 
 
Basis spread on variable rate
 
 
 
 
 
 
 
 
 
 
 
 
2.30% 
0.00% 
3.30% 
0.80% 
Short-term borrowings
 
 
 
 
 
 
 
 
0 
 
 
 
 
 
 
 
Line of Credit Facility, Remaining Borrowing Capacity
 
 
 
 
 
 
 
 
19,920,000 
 
 
 
 
 
 
 
Proceeds from Revolving Credit Facility
0 
4,000,000 
32,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
Payments on revolving credit facility
0 
36,000,000 
0 
 
 
 
 
 
 
 
 
 
 
 
 
 
Notes payable face amount
 
 
 
 
 
313,000 
 
 
 
 
 
 
 
 
 
 
Stated interest rate
 
 
 
 
 
5.00% 
 
 
 
 
 
 
 
 
 
 
Notes payable
0 
313,000 
 
0 
313,000 
 
 
 
 
 
 
 
 
 
 
 
Interest costs incurred
374,000 
440,000 
365,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
Interest costs capitalized
$ 0 
$ 108,000 
$ 0 
 
 
 
 
 
 
 
 
 
 
 
 
 
LEASES - Narrative (Details) (USD $)
In Thousands, unless otherwise specified
3 Months Ended 12 Months Ended
Apr. 1, 2015
Dec. 28, 2016
Dec. 30, 2015
Dec. 31, 2014
Leases [Abstract]
 
 
 
 
Number of sale leaseback transactions
0 
8 
 
 
Common area maintenance costs, real estate taxes, and other occocupancy costs not included in rent expense
 
$ 3,229 
$ 2,119 
$ 1,111 
Deemed Landlord Financing Liability
 
$ 2,007 
$ 0 
 
LEASES - Summary of Rent Expense (Details) (USD $)
In Thousands, unless otherwise specified
12 Months Ended
Dec. 28, 2016
Dec. 30, 2015
Dec. 31, 2014
Leases [Abstract]
 
 
 
Minimum rent
$ 15,408 
$ 10,796 
$ 6,497 
Deferred rent
2,122 
1,482 
2,830 
Contingent rent
4,294 
2,959 
1,883 
Total rent expense
$ 21,824 
$ 15,237 
$ 11,210 
LEASES - Schedule of Future Minimum Lease Payments (Details) (USD $)
In Thousands, unless otherwise specified
Dec. 28, 2016
Leases [Abstract]
 
2016
$ 20,688 
Minimum future rental payments, lease financing arrangements, Year 1
612 
2017
21,872 
Minimum future rental payments, lease financing arrangements, Year 2
1,484 
2018
22,173 
Minimum future rental payments lease financing arrangements Year 3
1,614 
2019
21,766 
Minimum future rental payments, lease financing arrangements, Year 4
1,642 
2020
21,965 
Minimum future rental payments, lease financing arrangements, Year 5
1,670 
Thereafter
123,372 
Minimum future rental payments, lease financing arrangements, Thereafter
11,175 
Total minimum lease payments
231,836 
Total minimum future rental payments, lease financing arrangements
$ 18,197 
EMPLOYEE BENEFIT PLANS - Deferred Compensation (Details) (Executive, Deferred Bonus, USD $)
1 Months Ended 12 Months Ended
Oct. 31, 2015
Dec. 28, 2016
Dec. 30, 2015
Dec. 25, 2013
Executive |
Deferred Bonus
 
 
 
 
Deferred Compensation Arrangement with Individual, Excluding Share-based Payments and Postretirement Benefits [Line Items]
 
 
 
 
Deferred compensation award due to executive
 
 
 
$ 2,450,000 
Deferred compensation expense
 
0 
0 
2,054,000 
Deferred Compensation Arrangement with Individual, Employer Contribution
$ 2,450,000 
 
 
 
EMPLOYEE BENEFIT PLANS - Defined Contribution Plan (Details) (USD $)
12 Months Ended
Dec. 28, 2016
Dec. 30, 2015
Dec. 31, 2014
Defined Benefit Plan Disclosure [Line Items]
 
 
 
Employer contributions
$ 257,000 
$ 238,000 
$ 132,000 
Defined Contribution Plan, Initial Contribution
 
 
 
Defined Benefit Plan Disclosure [Line Items]
 
 
 
Employer matching contribution percentage
100.00% 
 
 
Employer matching contribution as a percent of employees' gross pay
3.00% 
 
 
Defined Contribution Plan, Additional Contribution
 
 
 
Defined Benefit Plan Disclosure [Line Items]
 
 
 
Employer matching contribution percentage
50.00% 
 
 
Employer matching contribution as a percent of employees' gross pay
3.00% 
 
 
Defined Contribution Plan, Additional Contribution |
Maximum
 
 
 
Defined Benefit Plan Disclosure [Line Items]
 
 
 
Employer matching contribution as a percent of employees' gross pay
5.00% 
 
 
STOCKHOLDER'S EQUITY (Details) (USD $)
In Thousands, except Share data, unless otherwise specified
0 Months Ended 4 Months Ended 12 Months Ended 0 Months Ended 0 Months Ended 1 Months Ended 0 Months Ended 4 Months Ended 11 Months Ended 12 Months Ended 0 Months Ended 4 Months Ended 12 Months Ended 0 Months Ended 0 Months Ended 1 Months Ended 11 Months Ended 1 Months Ended 11 Months Ended 4 Months Ended 12 Months Ended 1 Months Ended
Feb. 4, 2015
board_of_director_class
Dec. 15, 2014
Dec. 30, 2015
Dec. 28, 2016
Dec. 30, 2015
Dec. 31, 2014
Feb. 4, 2015
Feb. 4, 2015
Class A Common Stock
Dec. 28, 2016
Class A Common Stock
Dec. 30, 2015
Class A Common Stock
Feb. 4, 2015
Class A Common Stock
Feb. 4, 2015
Class B Common Stock
Dec. 28, 2016
Class B Common Stock
Dec. 30, 2015
Class B Common Stock
Feb. 4, 2015
Class B Common Stock
Aug. 31, 2015
Secondary offering
Dec. 30, 2015
USC Merger
Feb. 4, 2015
Common stock
Class A Common Stock
Dec. 30, 2015
Common stock
Class A Common Stock
Dec. 30, 2015
Common stock
Class A Common Stock
Dec. 28, 2016
Common stock
Class A Common Stock
Feb. 4, 2015
Common stock
Class B Common Stock
Dec. 30, 2015
Common stock
Class B Common Stock
Dec. 28, 2016
Common stock
Class B Common Stock
Feb. 4, 2015
Common stock
IPO
Class A Common Stock
Feb. 4, 2015
Common stock
IPO
Class A Common Stock
Feb. 4, 2015
Common stock
Over-allotment option
Class A Common Stock
Aug. 31, 2015
Common stock
Secondary offering
Class A Common Stock
Aug. 31, 2015
Common stock
Secondary offering
Class B Common Stock
Dec. 30, 2015
Common stock
USC Merger
Class A Common Stock
Dec. 30, 2015
Common stock
USC Merger
Class A Common Stock
Dec. 30, 2015
Common stock
USC Merger
Class B Common Stock
Dec. 30, 2015
Common stock
USC Merger
Class B Common Stock
Dec. 30, 2015
Limited Liability Company
Dec. 28, 2016
Limited Liability Company
Aug. 31, 2015
Limited Liability Company
Secondary offering
Class of Stock [Line Items]
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Common stock, shares authorized
 
 
   
 
   
 
 
 
200,000,000 
200,000,000 
200,000,000 
 
35,000,000 
35,000,000 
35,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Common stock par value (in dollars per share)
 
 
    
 
    
 
 
 
$ 0.001 
$ 0.001 
$ 0.001 
 
$ 0.001 
$ 0 
$ 0.001 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Preferred stock, shares authorized
 
 
10,000,000 
10,000,000 
10,000,000 
 
10,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Number of classes of directors
3 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Board of directors, term
3 years 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Number of votes per share
1 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Ratio of common stock to limited liability company interest
 
 
 
 
 
 
 
1 
 
 
 
1 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Shares issued during the period
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
5,968,841 
 
5,750,000 
 
30,160,694 
 
 
5,750,000 
 
750,000 
 
 
1,727,804 
 
 
 
 
 
 
Proceeds of issuance of initial public offering net of underwriting discounts and commissions
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$ 112,298 
 
 
 
 
 
 
 
 
 
 
 
Shares issued, share price (in dollars per share)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$ 21 
 
$ 60 
 
 
 
 
 
 
 
 
Total conversion of units (shares)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
4,000,000 
 
 
 
 
 
 
 
 
Conversion of units from former equity owners (shares)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
844,727 
 
 
 
 
 
 
 
 
Redemptions (shares)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
2,848,035 
 
5,207,149 
 
 
 
 
 
 
3,155,273 
 
 
1,727,804 
 
(1,727,804)
 
 
 
LLC interests acquired
5,968,841 
 
2,848,035 
5,207,149 
6,003,308 
 
 
 
 
 
 
 
 
 
 
3,155,273 
1,727,804 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Number of units redeemed (shares)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
2,848,035 
5,207,149 
3,155,273 
Effect of redemption (shares)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
5,968,841 
2,848,035 
5,207,149 
 
 
 
 
3,155,273 
 
 
1,727,804 
 
 
 
 
Member distribution threshold, percentage
 
27.30% 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Member distributions
$ 11,125 
 
 
$ 0 
$ 11,125 
$ 27,070 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
NON-CONTROLLING INTERESTS - Narrative (Details)
0 Months Ended 1 Months Ended 4 Months Ended 12 Months Ended 0 Months Ended 1 Months Ended 11 Months Ended 12 Months Ended 1 Months Ended 4 Months Ended 12 Months Ended 1 Months Ended 12 Months Ended
Feb. 4, 2015
entity
Feb. 4, 2015
business
Feb. 28, 2015
Dec. 30, 2015
Dec. 28, 2016
Dec. 30, 2015
Feb. 4, 2015
Feb. 4, 2015
Class A Common Stock
Feb. 4, 2015
Class A Common Stock
Common stock
Dec. 30, 2015
Class A Common Stock
Common stock
Dec. 30, 2015
Class A Common Stock
Common stock
Dec. 28, 2016
Class A Common Stock
Common stock
Aug. 31, 2015
Secondary offering
Dec. 30, 2015
Limited Liability Company
Dec. 28, 2016
Limited Liability Company
Aug. 31, 2015
Limited Liability Company
Secondary offering
Dec. 28, 2016
Stock options
Dec. 30, 2015
Stock options
Noncontrolling Interest [Line Items]
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Ratio of common stock to limited liability company interest
 
 
 
 
 
 
 
1 
 
 
 
 
 
 
 
 
 
 
Weighted average ownership percentage
 
 
 
 
36.80% 
61.00% 
 
 
 
 
 
 
 
 
 
 
 
 
Units purchased during the period (shares)
 
 
5,750,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Units acquired during the period (shares)
5,968,841 
5,968,841 
 
2,848,035 
5,207,149 
6,003,308 
 
 
 
 
 
 
3,155,273 
 
 
 
154,976 
0 
Number of entities acquired
2 
2 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
LLC interests issued for share-based compensation (shares)
339,306 
339,306 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Issuance of class A common stock in settlement of unit appreciation rights (shares)
 
 
 
 
 
 
 
 
339,306 
1,727,804 
339,306 
339,306 
 
 
 
 
 
 
Number of units redeemed (shares)
 
 
 
 
 
 
 
 
 
 
 
 
 
2,848,035 
5,207,149 
3,155,273 
 
 
Ownership percent of noncontrolling interest
 
 
 
54.60% 
69.10% 
54.60% 
33.30% 
 
 
 
 
 
 
 
 
 
 
 
NON-CONTROLLING INTERESTS - Ownership Interest in SSE Holdings (Details)
Dec. 28, 2016
Dec. 30, 2015
Feb. 4, 2015
Noncontrolling Interest [Abstract]
 
 
 
Number of LLC Interests held by Shake Shack Inc.
25,151,384 
19,789,259.000 
 
Number of LLC Interests held by Shake Shack Inc. (in percentage)
69.10% 
54.60% 
33.30% 
Number of LLC Interests held by non-controlling interest holders
11,253,592 
16,460,741.000 
 
Number of LLC Interests held by non-controlling interest holders (in percentage)
30.90% 
45.40% 
66.70% 
Total LLC Interests outstanding
36,404,976 
36,250,000 
 
Total LLC Interests outstanding (in percentage)
100.00% 
100.00% 
 
NON-CONTROLLING INTERESTS - Schedule of Non-Controlling Interest (Details) (USD $)
In Thousands, unless otherwise specified
3 Months Ended 11 Months Ended 12 Months Ended
Dec. 28, 2016
Sep. 28, 2016
Jun. 29, 2016
Mar. 30, 2016
Dec. 30, 2015
Sep. 30, 2015
Jul. 1, 2015
Apr. 1, 2015
Dec. 30, 2015
Dec. 28, 2016
Dec. 30, 2015
Dec. 31, 2014
Noncontrolling Interest [Line Items]
 
 
 
 
 
 
 
 
 
 
 
 
Net income (loss) attributable to Shake Shack Inc.
$ 3,920 
$ 3,766 
$ 3,298 
$ 1,462 
$ 1,246 
$ 1,528 
$ 1,118 
$ (12,668)
 
$ 12,446 
$ (8,776)
$ 2,118 
Net income (loss) attributable to Shake Shack Inc.
 
 
 
 
 
 
 
 
 
12,436 
(8,781)
2,118 
Unrealized holding losses on available-for-sale securities
 
 
 
 
 
 
 
 
(11)
(16)1
(11)1
0 1
Total effect of changes in ownership interest on equity attributable to Shake Shack Inc.
 
 
 
 
 
 
 
 
 
30,247 
(57,134)
2,118 
Accumulated Other Comprehensive Loss
 
 
 
 
 
 
 
 
 
 
 
 
Noncontrolling Interest [Line Items]
 
 
 
 
 
 
 
 
 
 
 
 
Unrealized holding losses on available-for-sale securities
 
 
 
 
 
 
 
 
(5)
(10)
(5)
0 
Unit appreciation rights
 
 
 
 
 
 
 
 
 
 
 
 
Noncontrolling Interest [Line Items]
 
 
 
 
 
 
 
 
 
 
 
 
Transfers (to) from non-controlling interests
 
 
 
 
 
 
 
 
 
0 
987 
0 
Stock options
 
 
 
 
 
 
 
 
 
 
 
 
Noncontrolling Interest [Line Items]
 
 
 
 
 
 
 
 
 
 
 
 
Transfers (to) from non-controlling interests
 
 
 
 
 
 
 
 
 
825 
 
 
IPO
 
 
 
 
 
 
 
 
 
 
 
 
Noncontrolling Interest [Line Items]
 
 
 
 
 
 
 
 
 
 
 
 
Transfers (to) from non-controlling interests
 
 
 
 
 
 
 
 
 
0 
(75,182)
0 
Redemption or Exchange of Units
 
 
 
 
 
 
 
 
 
 
 
 
Noncontrolling Interest [Line Items]
 
 
 
 
 
 
 
 
 
 
 
 
Transfers (to) from non-controlling interests
 
 
 
 
 
 
 
 
 
16,986 
19,934 
0 
USC Merger
 
 
 
 
 
 
 
 
 
 
 
 
Noncontrolling Interest [Line Items]
 
 
 
 
 
 
 
 
 
 
 
 
Transfers (to) from non-controlling interests
 
 
 
 
 
 
 
 
 
$ 0 
$ 5,908 
$ 0 
EQUITY-BASED COMPENSATION - Schedule of compensation expense recognized (Details) (USD $)
12 Months Ended
Dec. 28, 2016
Dec. 30, 2015
Dec. 31, 2014
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
 
 
Equity-based compensation expense
$ 5,354,000 
$ 16,681,000 
$ 165,000 
Total income tax benefit recognized related to equity-based compensation
168,000 
482,000 
4,000 
Unit appreciation rights
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
 
 
Equity-based compensation expense
0 
11,762,000 
0 
Stock options
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
 
 
Equity-based compensation expense
4,262,000 
4,314,000 
0 
Performance Shares
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
 
 
Equity-based compensation expense
$ 1,092,000 
$ 0 
$ 0 
EQUITY-BASED COMPENSATION - Narrative (Details) (USD $)
In Thousands, except Share data, unless otherwise specified
12 Months Ended 1 Months Ended 1 Months Ended 0 Months Ended 1 Months Ended 11 Months Ended 12 Months Ended 12 Months Ended 12 Months Ended 12 Months Ended
Dec. 28, 2016
Dec. 30, 2015
Dec. 31, 2014
Dec. 28, 2016
Unit appreciation rights
Dec. 30, 2015
Unit appreciation rights
Dec. 31, 2014
Unit appreciation rights
Dec. 28, 2016
Restricted Class B units
Dec. 30, 2015
Restricted Class B units
Dec. 31, 2014
Restricted Class B units
Dec. 28, 2016
Stock options
Dec. 30, 2015
Stock options
Dec. 31, 2014
Stock options
Dec. 28, 2016
Performance Shares
Dec. 30, 2015
Performance Shares
Dec. 31, 2014
Performance Shares
Feb. 3, 2015
Minimum
Restricted Class B units
Feb. 3, 2015
Maximum
Restricted Class B units
Jan. 31, 2015
2015 Incentive Award Plan
Jan. 31, 2015
2015 Incentive Award Plan
Minimum
Stock options
Jan. 31, 2015
2015 Incentive Award Plan
Maximum
Stock options
Feb. 4, 2015
Common stock
Class A Common Stock
Dec. 30, 2015
Common stock
Class A Common Stock
Dec. 30, 2015
Common stock
Class A Common Stock
Dec. 28, 2016
Common stock
Class A Common Stock
Dec. 30, 2015
Unit Appreciation Rights Plan
Unit appreciation rights
Feb. 3, 2015
Unit Appreciation Rights Plan
Unit appreciation rights
Dec. 31, 2014
Unit Appreciation Rights Plan
Unit appreciation rights
Dec. 28, 2016
2015 Incentive Award Plan
Dec. 30, 2015
2015 Incentive Award Plan
Dec. 31, 2014
2015 Incentive Award Plan
Dec. 28, 2016
2015 Incentive Award Plan
Stock options
Dec. 30, 2015
2015 Incentive Award Plan
Stock options
Dec. 28, 2016
2015 Incentive Award Plan
Performance Shares
Dec. 30, 2015
2015 Incentive Award Plan
Performance Shares
Dec. 31, 2014
2015 Incentive Award Plan
Performance Shares
Dec. 28, 2016
2015 Incentive Award Plan
Minimum
Performance Shares
Dec. 28, 2016
2015 Incentive Award Plan
Maximum
Performance Shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Number of shares available for grant
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
5,865,522 
 
 
 
 
 
 
 
31,303 
 
 
 
 
 
 
 
 
 
 
 
Equity-based compensation expense
$ 5,354 
$ 16,681 
$ 165 
$ 0 
$ 11,762 
$ 0 
$ 0 
$ 605 
$ 165 
$ 4,262 
$ 4,314 
$ 0 
$ 1,092 
$ 0 
$ 0 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Unit appreciation rights vested and settled
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
22,554 
 
 
 
 
 
 
 
 
 
 
 
 
Issuance of class A common stock in settlement of unit appreciation rights (shares)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
339,306 
1,727,804 
339,306 
339,306 
 
 
 
 
 
 
 
 
 
 
 
 
 
Award vesting period
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
3 years 
5 years 
 
1 year 
5 years 
 
 
 
 
 
 
 
 
 
 
 
 
3 years 
 
 
 
 
Granted (in USD per share)
 
 
 
 
 
 
 
$ 0.00 
$ 0.00 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$ 38.41 
 
 
 
 
Restricted class B units weighted average grant date fair value vested (in USD per share)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$ 0.00 
 
 
 
 
Stock options granted in the period
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
16,931 
2,622,281 
 
 
 
 
 
 
 
 
Weighted average exercise price for stock options granted (in USD per share)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$ 34.74 
$ 21.00 
 
 
 
 
 
 
 
 
Range of awards
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
0.00% 
125.00% 
Performance period
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
1 year 
 
 
 
 
Equity based compensation
139 
0 
0 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Dividend yield
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
0.00% 
0.00% 
 
 
 
 
 
Stock options outstanding
 
 
 
 
 
 
 
0 
0 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
0 
 
0 
2,364,722 
2,574,981 
0 
 
 
 
 
 
 
 
Stock options exercisable
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
400,471 
 
 
 
 
 
 
 
 
 
Unrecognized compensation expense (USD)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
12,621 
 
 
 
 
 
 
 
 
 
Weighted-average period for recognition compensation expense
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
3 years 0 months 25 days 
 
 
 
 
2 years 4 months 3 days 
 
 
 
 
Performance shares granted (in shares)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
61,600 
0 
0 
 
 
Cash received from stock option exercises
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
3,194 
 
 
 
 
 
 
 
 
 
Performance stock vested (in shares)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
0 
 
 
 
 
Shares expected to be recognized
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$ 1,591 
 
 
 
 
EQUITY-BASED COMPENSATION - Schedule of Unit Appreciation Rights (Details) (Unit Appreciation Rights Plan, Unit appreciation rights vested and settled)
12 Months Ended
Dec. 30, 2015
Unit Appreciation Rights Plan |
Unit appreciation rights vested and settled
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
Vested and settled (in shares)
(22,554)
EQUITY-BASED COMPENSATION - Schedule of Fair Value of Stock Options (Details) (2015 Incentive Award Plan, Stock options)
12 Months Ended
Dec. 28, 2016
Dec. 30, 2015
2015 Incentive Award Plan |
Stock options
 
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
 
Expected term (years)
5 years 6 months 
7 years 6 months 
Expected volatility
50.70% 
35.10% 
Risk-free interest rate
1.50% 
1.60% 
Dividend yield
0.00% 
0.00% 
EQUITY-BASED COMPENSATION - Schedule of Stock Options (Details) (USD $)
In Thousands, except Share data, unless otherwise specified
12 Months Ended
Dec. 28, 2016
Dec. 30, 2015
Dec. 31, 2014
2015 Incentive Award Plan
 
 
 
Stock Options
 
 
 
Outstanding at beginning of period (in shares)
2,574,981 
0 
 
Granted (in shares)
16,931 
2,622,281 
 
Exercised (in shares)
(160,230)
0 
 
Forfeited (in shares)
(66,960)
(47,300)
 
Expired (in shares)
0 
0 
 
Outstanding at end of period (in shares)
2,364,722 
2,574,981 
 
Options exercisable at end of period (in shares)
400,471 
 
 
Options expected to vest (in shares)
1,847,242 
 
 
Weighted Average Exercise Price
 
 
 
Outstanding at beginning of period (in USD per share)
$ 21.00 
$ 0.00 
 
Granted (in USD per share)
$ 34.74 
$ 21.00 
 
Exercised (in USD per share)
$ 21.00 
$ 0.00 
 
Forfeited (in USD per share)
$ (21.00)
$ (21.00)
 
Expired (in USD per share)
$ 0.00 
$ 0.00 
 
Outstanding at end of period (in USD per share)
$ 21.10 
$ 21.00 
 
Options exercisable at end of year (in USD per share)
$ 21.00 
 
 
Options expected to vest (in USD per share)
$ 21.13 
 
 
Aggregate Intrinsic Value
 
 
 
Outstanding at end of period
$ 37,201 
 
 
Options vested and exercisable as of December 28, 2016
6,339 
 
 
Options expected to vest
$ 29,009 
 
 
Weighted Average Remaining Contractual Life (Years)
 
 
 
Outstanding at end of period
8 years 1 month 4 days 
 
 
Options exercisable at end of year
8 years 1 month 
0 years 
 
Options expected to vest
8 years 1 month 5 days 
 
 
Stock options
 
 
 
Stock Options
 
 
 
Nonvested beginning balance (in shares)
2,574,981 
0 
 
Nonvested ending balance (in shares)
1,964,251 
2,574,981 
 
Options exercisable at end of period (in shares)
(562,296)
0 
 
Weighted Average Exercise Price
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Options, Nonvested, Weighted Average Grant Date Fair Value
$ 8.66 
$ 8.53 
$ 0.00 
Options exercisable at end of year (in USD per share)
$ 8.32 
$ 0.00 
 
Weighted Average Remaining Contractual Life (Years)
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Options, Nonvested Options Forfeited, Number of Shares
(65,365)
(47,300)
 
Share-based Compensation Arrangement by Share-based Payment Award, Options, Nonvested Options Forfeited, Weighted Average Grant Date Fair Value
$ 8.59 
$ 8.59 
 
Stock options |
2015 Incentive Award Plan
 
 
 
Stock Options
 
 
 
Granted (in shares)
16,931 
2,622,281 
 
Weighted Average Exercise Price
 
 
 
Granted (in USD per share)
$ 16.32 
$ 8.53 
 
EQUITY-BASED COMPENSATION - Stock Options Outstanding and Exercisable (Details) (2015 Incentive Award Plan, USD $)
12 Months Ended
Dec. 28, 2016
Exercise Price
 
Range of exercise price - Lower range limit
$ 21 
Range of exercise price - Upper range limit
$ 21 
Twenty-One Dollars
 
Options Outstanding
 
Number Outstanding (in shares)
2,347,791 
Weighted Average Remaining Contractual Life (Years)
8 years 1 month 
Weighted Average Exercise Price (in USD per share)
$ 21.00 
Options Exercisable
 
Number Exercisable (in shares)
400,471 
Weighted Average Remaining Contractual Life (Years)
8 years 1 month 
Weighted Average Exercise Price (in USD per share)
$ 21.00 
Thirty-Four Point Sixty Two Dollars
 
Options Outstanding
 
Number Outstanding (in shares)
15,823 
Weighted Average Remaining Contractual Life (Years)
9 years 4 months 11 days 
Weighted Average Exercise Price (in USD per share)
$ 34.62 
Thirty-Six Point Forty One Dollars
 
Options Outstanding
 
Number Outstanding (in shares)
1,108 
Weighted Average Remaining Contractual Life (Years)
9 years 10 months 16 days 
Weighted Average Exercise Price (in USD per share)
$ 36.41 
Performance Shares
 
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items]
 
Expired (in shares)
0 
Options Exercisable
 
Share-based Compensation Arrangements by Share-based Payment Award, Non-Option Equity Instruments, Forfeited, Weighted Average Grant Price
$ 0.00 
EQUITY-BASED COMPENSATION - Summary of Performance Stock Activity (Details) (2015 Incentive Award Plan, Performance Shares, USD $)
12 Months Ended
Dec. 28, 2016
Dec. 31, 2014
2015 Incentive Award Plan |
Performance Shares
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Non-Option Equity Instruments, Outstanding [Roll Forward]
 
 
Outstanding at beginning of period (in shares)
0 
0 
Granted (in shares)
63,600 
 
Vested (in shares)
0 
 
Forfeited (in shares)
(2,000)
 
Expired (in shares)
0 
 
Outstanding at end of period (in shares)
61,600 
0 
Stock Options
 
 
Outstanding at beginning of period (in USD per share)
$ 0.00 
 
Granted (in USD per share)
$ 38.41 
 
Vested (in USD per share)
$ 0.00 
 
Forfeited (in USD per share)
$ 38.43 
 
Expired (in USD per share)
$ 0.00 
 
Outstanding at end of period (in USD per share)
$ 38.41 
 
INCOME TAXES - Schedule of Components of Income before Income Taxes (Details) (USD $)
In Thousands, unless otherwise specified
12 Months Ended
Dec. 28, 2016
Dec. 30, 2015
Dec. 31, 2014
Income Tax Disclosure [Abstract]
 
 
 
Domestic
$ 20,623 
$ 244 
$ (3,007)
Foreign
7,873 
6,184 
5,787 
Income before income taxes
$ 28,496 
$ 6,428 
$ 2,780 
INCOME TAXES - Schedule of Components of Income Tax Expense (Details) (USD $)
In Thousands, unless otherwise specified
12 Months Ended
Dec. 28, 2016
Dec. 30, 2015
Dec. 31, 2014
Current income taxes:
 
 
 
Federal
$ 3,767 
$ 2,474 
$ 0 
State and local
2,439 
1,131 
194 
Foreign
667 
433 
561 
Total current income taxes
6,873 
4,038 
755 
Deferred income taxes:
 
 
 
Federal
(48)
(267)
0 
State and local
(475)
(467)
(93)
Total deferred income taxes
(523)
(734)
(93)
Income tax expense
$ 6,350 
$ 3,304 
$ 662 
INCOME TAXES - Reconciliation of Income Tax Expense (Details) (USD $)
In Thousands, unless otherwise specified
12 Months Ended
Dec. 28, 2016
Dec. 30, 2015
Dec. 31, 2014
Income Tax Disclosure [Abstract]
 
 
 
U.S. federal statutory income tax rate
34.00% 
34.00% 
34.00% 
Income taxes at U.S. federal statutory rate
$ 9,689 
$ 2,186 
$ 945 
State and local income taxes, net of federal benefit
1,461 
663 
101 
Effective Income Tax Rate Reconciliation, State and Local Income Taxes, Percent
5.10% 
10.30% 
3.60% 
Foreign withholding taxes
667 
433 
561 
Effective Income Tax Rate Reconciliation, Foreign Income Tax Rate Differential, Percent
2.30% 
6.70% 
20.20% 
Non-deductible expenses
25 
653 
0 
Effective Income Tax Rate Reconciliation, Nondeductible Expense, Percent
0.10% 
10.20% 
0.00% 
Tax credits
(779)
(141)
0 
Effective Income Tax Rate Reconciliation, Tax Credit, Percent
(2.70%)
(2.20%)
0.00% 
Effective Income Tax Rate Reconciliation, Change in Enacted Tax Rate, Amount
(1,353)
0 
0 
Effective Income Tax Rate Reconciliation, Change in Enacted Tax Rate, Percent
(4.70%)
0.00% 
0.00% 
Non-controlling interest
(3,765)
(490)
0 
Effective Income Tax Rate Reconciliation, Noncontrolling Interest Income (Loss), Percent
(13.20%)
(7.60%)
0.00% 
LLC flow-through structure
0 
0 
(976)
Effective Income Tax Rate Reconciliation, Tax Exempt Income, Percent
0.00% 
0.00% 
(35.10%)
Other
405 
0 
31 
Effective Income Tax Rate Reconciliation, Other Adjustments, Percent
1.40% 
0.00% 
1.10% 
Income tax expense
$ 6,350 
$ 3,304 
$ 662 
Effective income tax rate (percent)
22.30% 
51.40% 
23.80% 
INCOME TAXES- Schedule of Deferred Tax Assets and Liabilities (Details) (USD $)
Dec. 28, 2016
Dec. 30, 2015
Dec. 31, 2014
Income Tax Disclosure [Abstract]
 
 
 
Deferred Tax Asset, Investment in Partnership
$ 209,648,000 
$ 154,649,000 
 
Deferred tax assets:
 
 
 
Tax Receivable Agreement
110,022,000 
69,513,000 
 
Deferred rent
561,000 
492,000 
 
Deferred revenue
53,000 
63,000 
 
Stock-based compensation
331,000 
218,000 
 
Net operating loss carryforwards
7,338,000 
334,000 
 
Deferred Tax Assets, Tax Credit Carryforwards
1,084,000 
0 
 
Other assets
108,000 
159,000 
 
Total gross deferred tax assets
329,145,000 
225,428,000 
 
Valuation allowance
(15,568,000)
(23,155,000)
0 
Total deferred tax assets, net of valuation allowance
313,577,000 
202,273,000 
 
Deferred tax liabilities:
 
 
 
Deferred Tax Liabilities, Property, Plant and Equipment
(370,000)
(316,000)
 
Deferred Tax Liabilities, Gross
(370,000)
(316,000)
 
Net deferred tax assets
$ 313,207,000 
$ 201,957,000 
 
INCOME TAXES - (Narrative) (Details) (USD $)
0 Months Ended 4 Months Ended 12 Months Ended
Feb. 4, 2015
Dec. 30, 2015
Dec. 28, 2016
Dec. 30, 2015
Dec. 31, 2014
Income Tax Disclosure [Abstract]
 
 
 
 
 
Deferred Tax Assets, Operating Loss Carryforwards, Domestic
 
 
$ 19,019,000 
 
 
Deferred Tax Assets, Operating Loss Carryforwards, State and Local
 
 
197,201,000 
 
 
Effective income tax rate (percent)
 
 
22.30% 
51.40% 
23.80% 
Net operating loss carryforwards
 
334,000 
7,338,000 
334,000 
 
Number of LLC interests (shares)
 
 
5,362,125 
 
 
Additional Deferred Tax Asset Recognized, Investment in Partnership
 
 
67,580,000 
 
 
Reduction in basis due to amortization of deferred tax asset related to the investment in partnership [Line Items]
 
 
12,269,000 
 
 
Valuation allowance
 
(23,155,000)
(15,568,000)
(23,155,000)
0 
Additional Deferred Tax Asset Recognized, Tax Receivable Agreement
 
 
40,094,000 
 
 
Deferred tax asset, tax receivable agreement
 
69,513,000 
110,022,000 
69,513,000 
 
Increase (decrease) in valuation allowance
 
 
(7,587,000)
 
 
Deferred income taxes
 
201,957,000 
313,207,000 
201,957,000 
 
Tax receivable agreement liability
 
 
272,482,000 
 
 
Uncertain tax positions
 
0 
0 
0 
 
Percentage of tax benefits due to equity owners
 
 
85.00% 
 
 
Tax receivable agreement amount paid
 
 
0.15 
 
 
LLC interests acquired
5,968,841 
2,848,035 
5,207,149 
6,003,308 
 
Establishment of liabilities under tax receivable agreement
 
 
100,063,000 
173,090,000 
0 
Current portion of liabilities under tax receivable agreement
 
2,157,000 
4,580,000 
2,157,000 
 
Effective Income Tax Rate Reconciliation, Change in Enacted Tax Rate, Amount
 
 
$ (1,353,000)
$ 0 
$ 0 
EARNINGS PER SHARE - Narrative (Details)
12 Months Ended 0 Months Ended 1 Months Ended 11 Months Ended 12 Months Ended 0 Months Ended
Dec. 28, 2016
Stock options
Dec. 30, 2015
Stock options
Dec. 31, 2014
Stock options
Feb. 4, 2015
Common stock
Class A Common Stock
Dec. 30, 2015
Common stock
Class A Common Stock
Dec. 30, 2015
Common stock
Class A Common Stock
Dec. 28, 2016
Common stock
Class A Common Stock
Feb. 4, 2015
Common stock
Class B Common Stock
Feb. 4, 2015
IPO
Common stock
Class A Common Stock
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
 
 
 
 
 
 
 
 
 
Shares issued during the period
 
 
 
5,968,841 
 
5,750,000 
 
30,160,694 
5,750,000 
Issuance of class A common stock in settlement of unit appreciation rights (shares)
 
 
 
339,306 
1,727,804 
339,306 
339,306 
 
 
Antidilutive shares
125 
2,574,981 
0 
 
 
 
 
 
 
EARNINGS PER SHARE - Schedule of Earnings Per Share (Details) (USD $)
In Thousands, except Per Share data, unless otherwise specified
1 Months Ended 3 Months Ended 11 Months Ended 12 Months Ended
Feb. 3, 2015
Dec. 28, 2016
Sep. 28, 2016
Jun. 29, 2016
Mar. 30, 2016
Dec. 30, 2015
Sep. 30, 2015
Jul. 1, 2015
Apr. 1, 2015
Dec. 30, 2015
Dec. 28, 2016
Dec. 30, 2015
Dec. 31, 2014
Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items]
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income
$ (13,049)
$ 5,457 
$ 6,789 
$ 6,549 
$ 3,351 
$ 3,046 
$ 6,193 
$ 5,145 
$ (11,260)
$ 16,173 
$ 22,146 
$ 3,124 
$ 2,118 
Less: net income attributable to non-controlling interests
 
 
 
 
 
 
 
 
 
 
9,700 
11,900 
0 
NET INCOME (LOSS) ATTRIBUTABLE TO SHAKE SHACK INC.
 
$ 3,920 
$ 3,766 
$ 3,298 
$ 1,462 
$ 1,246 
$ 1,528 
$ 1,118 
$ (12,668)
 
$ 12,446 
$ (8,776)
$ 2,118 
Denominator:
 
 
 
 
 
 
 
 
 
 
 
 
 
Weighted-average shares of Class A common stock outstanding—basic (shares)
 
 
 
 
 
 
 
 
 
 
22,956 1
13,588 1
29,977 1
Effect of dilutive securities:
 
 
 
 
 
 
 
 
 
 
 
 
 
Weighted-average shares of Class A common stock outstanding—diluted (shares)
 
 
 
 
 
 
 
 
 
 
23,449 1
13,588 1
30,122 1
Earnings per share of Class A common stock—basic (in dollars per share)
 
 
 
 
 
 
 
 
 
 
$ 0.54 1
$ (0.65)1
$ 0.07 1
Earnings per share of Class A common stock—diluted (in dollars per share)
 
 
 
 
 
 
 
 
 
 
$ 0.53 1
$ (0.65)1
$ 0.07 1
Restricted Class B Units
 
 
 
 
 
 
 
 
 
 
 
 
 
Effect of dilutive securities:
 
 
 
 
 
 
 
 
 
 
 
 
 
Restricted Class B units (shares)
 
 
 
 
 
 
 
 
 
 
0 
0 
145 
Stock options
 
 
 
 
 
 
 
 
 
 
 
 
 
Effect of dilutive securities:
 
 
 
 
 
 
 
 
 
 
 
 
 
Restricted Class B units (shares)
 
 
 
 
 
 
 
 
 
 
493 
0 
0 
EARNINGS PER SHARE EARNINGS PER SHARE - Antidilutive Securities (Details) (Details)
12 Months Ended
Dec. 28, 2016
Dec. 30, 2015
Dec. 31, 2014
Stock options
 
 
 
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
 
 
 
Antidilutive shares
125 
2,574,981 
0 
Performance Shares
 
 
 
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
 
 
 
Antidilutive shares
26,860 
0 
0 
Class B Common Stock
 
 
 
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
 
 
 
Antidilutive shares
11,253,592 
16,460,741 
0 
SUPPLEMENTAL CASH FLOW INFORMATION (Details) (USD $)
In Thousands, unless otherwise specified
12 Months Ended
Dec. 28, 2016
Dec. 30, 2015
Dec. 31, 2014
Cash paid for:
 
 
 
Income taxes, net of refunds
$ 1,823 
$ 416 
$ 836 
Interest, net of amounts capitalized
54 
92 
123 
Non-cash investing activities:
 
 
 
Accrued purchases of property and equipment
6,150 
4,904 
3,577 
Property and equipment acquired through landlord incentives
0 
0 
6,000 
Noncash Deemed Landlord Financing
1,985 
0 
0 
Employee Service Share-based Compensation, Allocation of Recognized Period Costs, Capitalized Amount
139 
0 
0 
Non-cash financing activities:
 
 
 
Establishment of liabilities under tax receivable agreement
100,063 
173,090 
0 
Accrued Distributions to Noncontrolling Interests
607 
0 
0 
IPO And Organizational Transaction |
Class A Common Stock
 
 
 
Non-cash investing activities:
 
 
 
Class A common stock issued
0 
6 
0 
IPO And Organizational Transaction |
Class B Common Stock
 
 
 
Non-cash financing activities:
 
 
 
Cancellation of Class B common stock
 
(6)
0 
Secondary Offering and Redemption of Units |
Class A Common Stock
 
 
 
Non-cash investing activities:
 
 
 
Class A common stock issued
5 
6 
0 
Secondary Offering and Redemption of Units |
Class B Common Stock
 
 
 
Non-cash financing activities:
 
 
 
Cancellation of Class B common stock
(5)
(6)
0 
USC Merger |
Class A Common Stock
 
 
 
Non-cash investing activities:
 
 
 
Class A common stock issued
0 
2 
0 
USC Merger |
Class B Common Stock
 
 
 
Non-cash financing activities:
 
 
 
Cancellation of Class B common stock
0 
(2)
0 
Parent Company |
IPO And Organizational Transaction |
Class A Common Stock
 
 
 
Non-cash investing activities:
 
 
 
Class A common stock issued
0 
6 
0 
Parent Company |
IPO And Organizational Transaction |
Class B Common Stock
 
 
 
Non-cash financing activities:
 
 
 
Cancellation of Class B common stock
0 
(6)
0 
Parent Company |
Secondary Offering and Redemption of Units |
Class A Common Stock
 
 
 
Non-cash investing activities:
 
 
 
Class A common stock issued
18,944 
19,933 
0 
Parent Company |
Secondary Offering and Redemption of Units |
Class B Common Stock
 
 
 
Non-cash financing activities:
 
 
 
Cancellation of Class B common stock
 
(6)
0 
Parent Company |
USC Merger |
Class A Common Stock
 
 
 
Non-cash investing activities:
 
 
 
Class A common stock issued
0 
2 
0 
Parent Company |
USC Merger |
Class B Common Stock
 
 
 
Non-cash financing activities:
 
 
 
Cancellation of Class B common stock
$ 0 
$ (2)
$ 0 
COMMITMENTS AND CONTINGENCIES (Details) (USD $)
12 Months Ended 1 Months Ended 12 Months Ended
Dec. 28, 2016
Dec. 28, 2016
Letter of credit
Dec. 28, 2016
Retail site
Dec. 31, 2013
Office building
Nov. 30, 2015
Former Shake Shack Manager Litigation
manager
Dec. 28, 2016
Former Shake Shack Manager Litigation
Dec. 28, 2016
IPO
Loss Contingencies [Line Items]
 
 
 
 
 
 
 
Letters of credit outstanding
 
 
$ 160,000 
$ 80,000 
 
 
 
Renewal term
 
1 year 
 
 
 
 
 
Number of former Shake Shack managers
 
 
 
 
2 
 
 
Settlement agreement amount funded
 
 
 
 
 
750,000 
 
Litigation Settlement, Expense
20,000 
 
 
 
 
 
 
Liability recognized from settlement
 
 
 
 
 
770,000 
 
Percentage of tax benefits due to equity owners
85.00% 
 
 
 
 
 
85.00% 
Tax receivable agreement liability
$ 272,482,000 
 
 
 
 
 
 
RELATED PARTY TRANSACTIONS (Details) (USD $)
0 Months Ended 1 Months Ended 12 Months Ended
Feb. 4, 2015
Feb. 3, 2015
Dec. 28, 2016
Dec. 30, 2015
Dec. 31, 2014
Related Party Transaction [Line Items]
 
 
 
 
 
Expenses from transactions with related party
 
 
$ 0 
$ 8,000 
$ 0 
Amounts due to related parties
 
 
0 
 
0 
Percentage of tax benefits due to equity owners
 
 
85.00% 
 
 
Tax receivable agreement amount paid
 
 
0.15 
 
 
Tax receivable agreement liability
 
 
272,482,000 
 
 
Payments to Noncontrolling Interests
 
 
1,745,000 
0 
0 
Partners' Capital Account, Distributions
11,125,000 
11,125,000 
 
 
27,070,000 
Distributions to Noncontrolling Interests Payable
 
 
607,000 
0 
 
Share Our Strength
 
 
 
 
 
Related Party Transaction [Line Items]
 
 
 
 
 
Expenses from transactions with related party
 
 
20,000 
 
 
Affiliated Entity
 
 
 
 
 
Related Party Transaction [Line Items]
 
 
 
 
 
Management fee percentage
 
 
 
 
2.50% 
General and administrative expenses
 
 
10,000 
157,000 
490,000 
Amounts due to related parties
 
 
1,000 
2,000 
 
Due from related parties, current
 
 
0 
 
 
Charitable campaign flow through
 
 
587,000 
504,276 
338,346 
Affiliated Entity |
Management fee
 
 
 
 
 
Related Party Transaction [Line Items]
 
 
 
 
 
Expenses from transactions with related party
 
 
0 
 
2,927,000 
Affiliated Entity |
Rent Expense
 
 
 
 
 
Related Party Transaction [Line Items]
 
 
 
 
 
Expenses from transactions with related party
 
 
0 
 
38,000 
Affiliated Entity |
Self insurance health care expense
 
 
 
 
 
Related Party Transaction [Line Items]
 
 
 
 
 
Expenses from transactions with related party
 
 
0 
146,000 
1,306,000 
Hudson Yards Sports and Entertainment
 
 
 
 
 
Related Party Transaction [Line Items]
 
 
 
 
 
Number of renewal terms
 
 
5 
 
 
Renewal option period
 
 
5 years 
 
 
Hudson Yards Sports and Entertainment |
Concession income
 
 
 
 
 
Related Party Transaction [Line Items]
 
 
 
 
 
Expenses from transactions with related party
 
 
309,000 
282,000 
218,000 
Due from related parties, current
 
 
11,000 
0 
 
Revenue from related parties
 
 
 
0 
 
Madison Square Park Conservancy |
Rent Expense
 
 
 
 
 
Related Party Transaction [Line Items]
 
 
 
 
 
Expenses from transactions with related party
 
 
1,062,000 
692,000 
528,000 
Due to MSP Conservancy, Current
 
 
1,000 
17,000 
 
Madison Square Park Conservancy |
Share Our Strength
 
 
 
 
 
Related Party Transaction [Line Items]
 
 
 
 
 
Expenses from transactions with related party
 
 
$ 117,000 
$ 109,000 
$ 69,000 
GEOGRAPHIC INFORMATION (Details) (USD $)
In Thousands, unless otherwise specified
3 Months Ended 12 Months Ended
Dec. 28, 2016
Sep. 28, 2016
Jun. 29, 2016
Mar. 30, 2016
Dec. 30, 2015
Sep. 30, 2015
Jul. 1, 2015
Apr. 1, 2015
Dec. 28, 2016
Dec. 30, 2015
Dec. 31, 2014
Revenues from External Customers and Long-Lived Assets [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Total revenue
$ 73,271 
$ 74,567 
$ 66,472 
$ 54,165 
$ 51,061 
$ 53,273 
$ 48,450 
$ 37,808 
$ 268,475 
$ 190,592 
$ 118,530 
United States
 
 
 
 
 
 
 
 
 
 
 
Revenues from External Customers and Long-Lived Assets [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Total revenue
 
 
 
 
 
 
 
 
260,602 
184,408 
112,743 
Other countries
 
 
 
 
 
 
 
 
 
 
 
Revenues from External Customers and Long-Lived Assets [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Total revenue
 
 
 
 
 
 
 
 
$ 7,873 
$ 6,184 
$ 5,787 
SELECTED QUARTERLY FINANCIAL DATA (UNAUDITED) (Details) (USD $)
In Thousands, except Per Share data, unless otherwise specified
1 Months Ended 3 Months Ended 11 Months Ended 12 Months Ended
Feb. 3, 2015
Dec. 28, 2016
Sep. 28, 2016
Jun. 29, 2016
Mar. 30, 2016
Dec. 30, 2015
Sep. 30, 2015
Jul. 1, 2015
Apr. 1, 2015
Dec. 30, 2015
Dec. 28, 2016
Dec. 30, 2015
Dec. 31, 2014
Quarterly Financial Information Disclosure [Abstract]
 
 
 
 
 
 
 
 
 
 
 
 
 
Total revenue
 
$ 73,271 
$ 74,567 
$ 66,472 
$ 54,165 
$ 51,061 
$ 53,273 
$ 48,450 
$ 37,808 
 
$ 268,475 
$ 190,592 
$ 118,530 
Operating income
 
4,988 
9,170 
8,933 
4,714 
3,654 
7,804 
6,244 
(10,949)
 
27,805 
6,753 
3,143 
Net income
(13,049)
5,457 
6,789 
6,549 
3,351 
3,046 
6,193 
5,145 
(11,260)
16,173 
22,146 
3,124 
2,118 
Net income attributable to Shake Shack Inc.
 
$ 3,920 
$ 3,766 
$ 3,298 
$ 1,462 
$ 1,246 
$ 1,528 
$ 1,118 
$ (12,668)
 
$ 12,446 
$ (8,776)
$ 2,118 
Earnings (loss) per share
 
 
 
 
 
 
 
 
 
 
 
 
 
Basic (in dollars per share)
 
$ 0.16 
$ 0.16 
$ 0.15 
$ 0.07 
$ 0.08 
$ 0.11 
$ 0.09 
$ (1.06)
 
 
 
 
Diluted (in dollars per share)
 
$ 0.15 
$ 0.15 
$ 0.14 
$ 0.07 
$ 0.07 
$ 0.10 
$ 0.08 
$ (1.06)
 
 
 
 
Fiscal period duration
 
 
 
 
 
 
 
 
 
 
364 days 
364 days 
371 days 
SCHEDULE I: CONDENSED FINANCIAL INFORMATION OF REGISTRANT - NOTES TO FINANCIAL STATEMENTS (Details) (USD $)
In Thousands, except Share data, unless otherwise specified
12 Months Ended 12 Months Ended 0 Months Ended 11 Months Ended 0 Months Ended 0 Months Ended 1 Months Ended 12 Months Ended 0 Months Ended 12 Months Ended 0 Months Ended 0 Months Ended 12 Months Ended
Dec. 28, 2016
Dec. 30, 2015
Dec. 31, 2014
Dec. 28, 2016
IPO
Dec. 28, 2016
Class A Common Stock
IPO And Organizational Transaction
Dec. 30, 2015
Class A Common Stock
IPO And Organizational Transaction
Dec. 31, 2014
Class A Common Stock
IPO And Organizational Transaction
Dec. 28, 2016
Class A Common Stock
USC Merger
Dec. 30, 2015
Class A Common Stock
USC Merger
Dec. 31, 2014
Class A Common Stock
USC Merger
Dec. 28, 2016
Class A Common Stock
Secondary Offering and Redemption of Units
Dec. 30, 2015
Class A Common Stock
Secondary Offering and Redemption of Units
Dec. 31, 2014
Class A Common Stock
Secondary Offering and Redemption of Units
Feb. 4, 2015
Class A Common Stock
Common stock
Dec. 30, 2015
Class A Common Stock
Common stock
Feb. 4, 2015
Class A Common Stock
Common stock
IPO
Feb. 4, 2015
Class A Common Stock
Common stock
IPO
Feb. 4, 2015
Class A Common Stock
Common stock
Over-allotment option
Dec. 30, 2015
Class A Common Stock
Common stock
USC Merger
Dec. 30, 2015
Class B Common Stock
IPO And Organizational Transaction
Dec. 31, 2014
Class B Common Stock
IPO And Organizational Transaction
Dec. 28, 2016
Class B Common Stock
USC Merger
Dec. 30, 2015
Class B Common Stock
USC Merger
Dec. 31, 2014
Class B Common Stock
USC Merger
Dec. 28, 2016
Class B Common Stock
Secondary Offering and Redemption of Units
Dec. 30, 2015
Class B Common Stock
Secondary Offering and Redemption of Units
Dec. 31, 2014
Class B Common Stock
Secondary Offering and Redemption of Units
Feb. 4, 2015
Class B Common Stock
Common stock
Dec. 28, 2016
Parent Company
Dec. 30, 2015
Parent Company
Dec. 31, 2014
Parent Company
Dec. 28, 2016
Parent Company
Class A Common Stock
IPO And Organizational Transaction
Dec. 30, 2015
Parent Company
Class A Common Stock
IPO And Organizational Transaction
Dec. 31, 2014
Parent Company
Class A Common Stock
IPO And Organizational Transaction
Dec. 28, 2016
Parent Company
Class A Common Stock
USC Merger
Dec. 30, 2015
Parent Company
Class A Common Stock
USC Merger
Dec. 31, 2014
Parent Company
Class A Common Stock
USC Merger
Dec. 28, 2016
Parent Company
Class A Common Stock
Secondary Offering and Redemption of Units
Dec. 30, 2015
Parent Company
Class A Common Stock
Secondary Offering and Redemption of Units
Dec. 31, 2014
Parent Company
Class A Common Stock
Secondary Offering and Redemption of Units
Feb. 4, 2015
Parent Company
Class A Common Stock
Common stock
IPO
Feb. 4, 2015
Parent Company
Class A Common Stock
Common stock
IPO
Feb. 4, 2015
Parent Company
Class A Common Stock
Common stock
Over-allotment option
Dec. 28, 2016
Parent Company
Class B Common Stock
IPO And Organizational Transaction
Dec. 30, 2015
Parent Company
Class B Common Stock
IPO And Organizational Transaction
Dec. 31, 2014
Parent Company
Class B Common Stock
IPO And Organizational Transaction
Dec. 28, 2016
Parent Company
Class B Common Stock
USC Merger
Dec. 30, 2015
Parent Company
Class B Common Stock
USC Merger
Dec. 31, 2014
Parent Company
Class B Common Stock
USC Merger
Dec. 30, 2015
Parent Company
Class B Common Stock
Secondary Offering and Redemption of Units
Dec. 31, 2014
Parent Company
Class B Common Stock
Secondary Offering and Redemption of Units
Dec. 28, 2016
Consolidation, Eliminations
Parent Company
Dec. 30, 2015
Consolidation, Eliminations
Parent Company
Dec. 31, 2014
Consolidation, Eliminations
Parent Company
Class of Stock [Line Items]
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Income taxes, net of refunds
$ 1,823 
$ 416 
$ 836 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$ 576 
$ 0 
$ 0 
Accrued contribution related to stock option exercises
1,116 
0 
0 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Class A common stock issued
 
 
 
 
0 
6 
0 
0 
2 
0 
5 
6 
0 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
0 
6 
0 
0 
2 
0 
18,944 
19,933 
0 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Non-cash Contribution Made In Connection With Equity Awards Granted To Employees Of SSE Holdings
5,304 
2,355 
0 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cancellation of Class B common stock
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(6)
0 
0 
(2)
0 
(5)
(6)
0 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
0 
(6)
0 
0 
(2)
0 
(6)
0 
 
 
 
Shares issued during the period
 
 
 
 
 
 
 
 
 
 
 
 
 
5,968,841 
5,750,000 
5,750,000 
 
750,000 
1,727,804 
 
 
 
 
 
 
 
 
30,160,694 
 
 
 
 
 
 
 
 
 
 
 
 
5,750,000 
 
750,000 
 
 
 
 
 
 
 
 
 
 
 
Shares issued, share price (in dollars per share)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$ 21 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$ 21.000 
 
 
 
 
 
 
 
 
 
 
 
 
Proceeds of issuance of initial public offering net of underwriting discounts and commissions
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
112,298 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
112,298 
 
 
 
 
 
 
 
 
 
 
 
 
 
Accounts Payable, Related Parties
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
1,655 
0 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Due from SSE Holdings
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
0 
3,979 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Intercompany revenue
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
1,603 
 
0 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
1,603 
1,336 
 
Equity in net income of subsidiaries
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
16,982 
6,906 
0 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
16,982 
 
 
Tax receivable agreement liability
$ 272,482 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$ 272,482 
$ 173,090 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$ 100,063 
$ 173,090 
$ 0 
Percentage of tax benefits due to equity owners
85.00% 
 
 
85.00% 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
85.00% 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
SCHEDULE I: CONDENSED FINANCIAL INFORMATION OF REGISTRANT - BALANCE SHEET ADDITIONAL INFORMATION (Details) (USD $)
Dec. 28, 2016
Dec. 30, 2015
Feb. 4, 2015
Condensed Balance Sheet Statements, Captions [Line Items]
 
 
 
Preferred stock, par value (in dollars per share)
$ 0.000 
$ 0.000 
 
Preferred stock, shares authorized
10,000,000 
10,000,000 
10,000,000 
Preferred stock, shares issued
0 
0 
 
Preferred stock, shares outstanding
0 
0 
 
Common stock par value (in dollars per share)
 
   
 
Common stock, shares authorized
 
   
 
Common stock, shares, issued
 
   
 
Common stock, shares, outstanding
 
   
 
Parent Company
 
 
 
Condensed Balance Sheet Statements, Captions [Line Items]
 
 
 
Preferred stock, par value (in dollars per share)
$ 0 
 
 
Preferred stock, shares authorized
10,000,000 
 
 
Preferred stock, shares issued
0 
 
 
Preferred stock, shares outstanding
0 
 
 
Common stock par value (in dollars per share)
 
$ 0.01 
 
Common stock, shares authorized
 
100 
 
Common stock, shares, issued
 
0 
 
Common stock, shares, outstanding
 
0 
 
Class A Common Stock
 
 
 
Condensed Balance Sheet Statements, Captions [Line Items]
 
 
 
Common stock par value (in dollars per share)
$ 0.001 
$ 0.001 
$ 0.001 
Common stock, shares authorized
200,000,000 
200,000,000 
200,000,000 
Common stock, shares, issued
25,151,384 
19,789,259 
 
Common stock, shares, outstanding
25,151,384 
19,789,259 
 
Class A Common Stock |
Parent Company
 
 
 
Condensed Balance Sheet Statements, Captions [Line Items]
 
 
 
Common stock par value (in dollars per share)
$ 0.001 
 
 
Common stock, shares authorized
200,000,000 
 
 
Common stock, shares, issued
19,789,259 
 
 
Common stock, shares, outstanding
19,789,259 
 
 
Class B Common Stock
 
 
 
Condensed Balance Sheet Statements, Captions [Line Items]
 
 
 
Common stock par value (in dollars per share)
$ 0.001 
$ 0 
$ 0.001 
Common stock, shares authorized
35,000,000 
35,000,000 
35,000,000 
Common stock, shares, issued
11,253,592 
16,460,741 
 
Common stock, shares, outstanding
11,253,592 
16,460,741 
 
Class B Common Stock |
Parent Company
 
 
 
Condensed Balance Sheet Statements, Captions [Line Items]
 
 
 
Common stock par value (in dollars per share)
$ 0.001 
 
 
Common stock, shares authorized
35,000,000 
 
 
Common stock, shares, issued
16,460,741 
 
 
Common stock, shares, outstanding
16,460,741 
 
 
SCHEDULE I: CONDENSED FINANCIAL INFORMATION OF REGISTRANT - STATEMENTS OF COMPREHENSIVE INCOME (Details) (USD $)
1 Months Ended 3 Months Ended 11 Months Ended 12 Months Ended
Feb. 3, 2015
Dec. 28, 2016
Sep. 28, 2016
Jun. 29, 2016
Mar. 30, 2016
Dec. 30, 2015
Sep. 30, 2015
Jul. 1, 2015
Apr. 1, 2015
Dec. 30, 2015
Dec. 28, 2016
Dec. 30, 2015
Dec. 31, 2014
Condensed Statement of Income Captions [Line Items]
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income
$ (13,049,000)
$ 5,457,000 
$ 6,789,000 
$ 6,549,000 
$ 3,351,000 
$ 3,046,000 
$ 6,193,000 
$ 5,145,000 
$ (11,260,000)
$ 16,173,000 
$ 22,146,000 
$ 3,124,000 
$ 2,118,000 
Other comprehensive loss:
 
 
 
 
 
 
 
 
 
 
 
 
 
Income tax benefit
 
 
 
 
 
 
 
 
 
 
0 
0 
0 
OTHER COMPREHENSIVE LOSS, NET OF TAX
 
 
 
 
 
 
 
 
 
(11,000)
(16,000)1
(11,000)1
0 1
COMPREHENSIVE INCOME
 
 
 
 
 
 
 
 
 
 
22,130,000 
3,113,000 
2,118,000 
Unrealized holding losses on available-for-sale securities
 
 
 
 
 
 
 
 
 
 
(35,000)1
(11,000)1
0 1
Other Comprehensive Income (Loss), Reclassification Adjustment from AOCI for Sale of Securities, Net of Tax
 
 
 
 
 
 
 
 
 
 
19,000 1
0 1
0 1
Parent Company
 
 
 
 
 
 
 
 
 
 
 
 
 
Condensed Statement of Income Captions [Line Items]
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income
 
 
 
 
 
 
 
 
 
 
12,446,000 
4,273,000 
0 
Other comprehensive loss:
 
 
 
 
 
 
 
 
 
 
 
 
 
OTHER COMPREHENSIVE LOSS, NET OF TAX
 
 
 
 
 
 
 
 
 
 
(10,000)1
(5,000)1
0 1
COMPREHENSIVE INCOME
 
 
 
 
 
 
 
 
 
 
12,436,000 
4,268,000 
0 
Unrealized holding losses on available-for-sale securities
 
 
 
 
 
 
 
 
 
 
(22,000)1
(5,000)1
0 1
Other Comprehensive Income (Loss), Reclassification Adjustment from AOCI for Sale of Securities, Net of Tax
 
 
 
 
 
 
 
 
 
 
$ 12,000 1
$ 0 1
$ 0 1
SCHEDULE I: CONDENSED FINANCIAL INFORMATION OF REGISTRANT - BALANCE SHEET (Details) (USD $)
In Thousands, unless otherwise specified
Dec. 28, 2016
Dec. 30, 2015
Dec. 31, 2014
Dec. 25, 2013
Current assets:
 
 
 
 
Accounts receivable
$ 6,006 
$ 4,217 
 
 
Total current assets
83,944 
78,934 
 
 
Deferred income taxes, net
313,207 
201,957 
 
 
TOTAL ASSETS
538,194 
379,547 
 
 
Current liabilities:
 
 
 
 
Accrued expenses
8,538 
6,801 
 
 
Current portion of liabilities under tax receivable agreement
4,580 
2,157 
 
 
Total current liabilities
31,716 
24,005 
 
 
Total liabilities
336,841 
222,528 
 
 
Liabilities under tax receivable agreement, net of current portion
267,902 
170,933 
 
 
Commitments and contingencies
   
   
 
 
Stockholders' equity:
 
 
 
 
Preferred stock, no par value—10,000,000 shares authorized; none issued and outstanding as of December 28, 2016 and December 30, 2015, respectively.
0 
0 
 
 
Additional paid-in capital
135,448 
96,311 
 
 
Retained earnings
16,719 
4,273 
 
 
Accumulated other comprehensive loss
(15)
(5)
 
 
Total stockholders' equity
201,353 
157,019 
12,600 
37,387 
TOTAL LIABILITIES AND STOCKHOLDERS'
538,194 
379,547 
 
 
Class A Common Stock
 
 
 
 
Stockholders' equity:
 
 
 
 
Common stock
25 
20 
 
 
Class B Common Stock
 
 
 
 
Stockholders' equity:
 
 
 
 
Common stock
11 
16 
 
 
Parent Company
 
 
 
 
Current assets:
 
 
 
 
Cash
3,785 
422 
 
 
Accounts receivable
2 
0 
 
 
Prepaid expenses
105 
628 
 
 
Total current assets
3,892 
1,050 
 
 
Due from SSE Holdings
0 
3,979 
 
 
Deferred income taxes, net
312,802 
201,614 
 
 
Investment in subsidiaries
109,680 
67,810 
 
 
TOTAL ASSETS
426,374 
274,453 
 
 
Current liabilities:
 
 
 
 
Income taxes payable
0 
689 
 
 
Accrued expenses
49 
59 
 
 
Accounts Payable, Related Parties
1,655 
0 
 
 
Current portion of liabilities under tax receivable agreement
4,580 
2,157 
 
 
Total current liabilities
6,284 
2,905 
 
 
Total liabilities
274,186 
173,838 
 
 
Liabilities under tax receivable agreement, net of current portion
267,902 
170,933 
 
 
Commitments and contingencies
   
   
 
 
Stockholders' equity:
 
 
 
 
Preferred stock, no par value—10,000,000 shares authorized; none issued and outstanding as of December 28, 2016 and December 30, 2015, respectively.
0 
0 
 
 
Additional paid-in capital
135,448 
96,311 
 
 
Retained earnings
16,719 
4,273 
 
 
Accumulated other comprehensive loss
(15)
(5)
 
 
Total stockholders' equity
152,188 
100,615 
 
 
TOTAL LIABILITIES AND STOCKHOLDERS'
426,374 
274,453 
 
 
Parent Company |
Class A Common Stock
 
 
 
 
Stockholders' equity:
 
 
 
 
Common stock
25 
20 
 
 
Parent Company |
Class B Common Stock
 
 
 
 
Stockholders' equity:
 
 
 
 
Common stock
$ 11 
$ 16 
 
 
SCHEDULE I: CONDENSED FINANCIAL INFORMATION OF REGISTRANT - STATEMENT OF INCOME (Details) (USD $)
In Thousands, unless otherwise specified
1 Months Ended 3 Months Ended 11 Months Ended 12 Months Ended
Feb. 3, 2015
Dec. 28, 2016
Sep. 28, 2016
Jun. 29, 2016
Mar. 30, 2016
Dec. 30, 2015
Sep. 30, 2015
Jul. 1, 2015
Apr. 1, 2015
Dec. 30, 2015
Dec. 28, 2016
Dec. 30, 2015
Dec. 31, 2014
Condensed Income Statements, Captions [Line Items]
 
 
 
 
 
 
 
 
 
 
 
 
 
TOTAL REVENUE
 
$ 73,271 
$ 74,567 
$ 66,472 
$ 54,165 
$ 51,061 
$ 53,273 
$ 48,450 
$ 37,808 
 
$ 268,475 
$ 190,592 
$ 118,530 
General and administrative expenses
 
 
 
 
 
 
 
 
 
 
30,556 
37,825 
18,187 
TOTAL EXPENSES
 
 
 
 
 
 
 
 
 
 
240,670 
183,839 
115,387 
OPERATING INCOME
 
4,988 
9,170 
8,933 
4,714 
3,654 
7,804 
6,244 
(10,949)
 
27,805 
6,753 
3,143 
Other Noncash Income (Expense)
 
 
 
 
 
 
 
 
 
 
688 
0 
0 
Interest Expense
 
 
 
 
 
 
 
 
 
 
(374)
(332)
(365)
INCOME BEFORE INCOME TAXES
 
 
 
 
 
 
 
 
 
 
28,496 
6,428 
2,780 
Income tax expense
 
 
 
 
 
 
 
 
 
 
6,350 
3,304 
662 
NET INCOME
(13,049)
5,457 
6,789 
6,549 
3,351 
3,046 
6,193 
5,145 
(11,260)
16,173 
22,146 
3,124 
2,118 
Parent Company
 
 
 
 
 
 
 
 
 
 
 
 
 
Condensed Income Statements, Captions [Line Items]
 
 
 
 
 
 
 
 
 
 
 
 
 
Intercompany revenue
 
 
 
 
 
 
 
 
 
 
1,603 
 
0 
Accounts Payable, Related Parties
 
1,655 
 
 
 
0 
 
 
 
0 
1,655 
0 
 
TOTAL REVENUE
 
 
 
 
 
 
 
 
 
 
1,603 
1,336 
0 
General and administrative expenses
 
 
 
 
 
 
 
 
 
 
1,603 
1,336 
0 
TOTAL EXPENSES
 
 
 
 
 
 
 
 
 
 
1,603 
1,336 
0 
OPERATING INCOME
 
 
 
 
 
 
 
 
 
 
0 
0 
0 
Equity in net income of subsidiaries
 
 
 
 
 
 
 
 
 
 
16,982 
6,906 
0 
Other Noncash Income (Expense)
 
 
 
 
 
 
 
 
 
 
688 
0 
0 
Interest Expense
 
 
 
 
 
 
 
 
 
 
(16)
0 
0 
INCOME BEFORE INCOME TAXES
 
 
 
 
 
 
 
 
 
 
17,654 
6,906 
0 
Income tax expense
 
 
 
 
 
 
 
 
 
 
5,208 
2,633 
0 
NET INCOME
 
 
 
 
 
 
 
 
 
 
$ 12,446 
$ 4,273 
$ 0 
SCHEDULE I: CONDENSED FINANCIAL INFORMATION OF REGISTRANT - STATEMENTS OF CASH FLOWS (Details) (USD $)
In Thousands, unless otherwise specified
12 Months Ended
Dec. 28, 2016
Dec. 30, 2015
Dec. 31, 2014
OPERATING ACTIVITIES
 
 
 
Net income
$ 22,146 
$ 3,124 
$ 2,118 
Deferred income taxes
(523)
(734)
(93)
Other Noncash Income (Expense)
(688)
0 
0 
Increase (Decrease) in Accounts Receivable
(2,974)
(775)
1,751 
Increase (Decrease) in Prepaid Expense and Other Assets
756 
958 
1,168 
Adjustments to reconcile net income to net cash provided by operating activities:
 
 
 
Equity-based compensation
5,354 
16,681 
165 
Changes in operating assets and liabilities:
 
 
 
Accrued expenses
5,560 
2,548 
3,349 
Other current liabilities
2,130 
257 
420 
INVESTING ACTIVITIES
 
 
 
NET CASH USED IN INVESTING ACTIVITIES
(114,761)
(34,514)
(28,515)
FINANCING ACTIVITIES
 
 
 
Proceeds from issuance of Class A common stock sold in initial public offering, net of underwriting discounts and commissions
0 
109,262 
0 
Proceeds from issuance of Class B common stock
0 
30 
0 
Proceeds from Stock Options Exercised
3,194 
0 
0 
NET CASH PROVIDED BY FINANCING ACTIVITIES
1,234 
61,428 
4,532 
NET CASH PROVIDED BY OPERATING ACTIVITIES
54,285 
41,258 
13,584 
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
(59,242)
68,172 
(10,399)
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD
70,849 
 
2,677 
CASH AND CASH EQUIVALENTS AT END OF PERIOD
11,607 
70,849 
 
Non-cash financing activities:
 
 
 
Establishment of liabilities under tax receivable agreement
100,063 
173,090 
0 
Class A Common Stock |
IPO And Organizational Transaction
 
 
 
Non-cash investing activities:
 
 
 
Class A common stock issued
0 
6 
0 
Class A Common Stock |
USC Merger
 
 
 
Non-cash investing activities:
 
 
 
Class A common stock issued
0 
2 
0 
Class A Common Stock |
Secondary Offering and Redemption of Units
 
 
 
Non-cash investing activities:
 
 
 
Class A common stock issued
5 
6 
0 
Class B Common Stock |
IPO And Organizational Transaction
 
 
 
Non-cash financing activities:
 
 
 
Cancellation of Class B common stock
 
(6)
0 
Class B Common Stock |
USC Merger
 
 
 
Non-cash financing activities:
 
 
 
Cancellation of Class B common stock
0 
(2)
0 
Class B Common Stock |
Secondary Offering and Redemption of Units
 
 
 
Non-cash financing activities:
 
 
 
Cancellation of Class B common stock
(5)
(6)
0 
Parent Company
 
 
 
OPERATING ACTIVITIES
 
 
 
Net income
12,446 
4,273 
0 
Non-cash reimbursement revenue treated as investment [Line Items]
(189)
0 
0 
Deferred income taxes
(462)
(551)
0 
Other Noncash Income (Expense)
(688)
0 
0 
Increase (Decrease) in Accounts Receivable
2 
0 
0 
Increase (Decrease) in Prepaid Expense and Other Assets
1 
0 
0 
Adjustments to reconcile net income to net cash provided by operating activities:
 
 
 
Equity income from affiliates
(16,982)
(6,906)
0 
Equity-based compensation
189 
330 
0 
Changes in operating assets and liabilities:
 
 
 
Due from SSE Holdings
214 
4 
0 
Accrued expenses
(11)
58 
0 
Other current liabilities
17 
0 
0 
Income taxes payable
5,023 
3,184 
0 
INVESTING ACTIVITIES
 
 
 
Purchases of LLC Interests from SSE Holdings
(4,559)
(112,298)
0 
Return of investment in SSE Holdings [Line Items]
2,694 
0 
0 
NET CASH USED IN INVESTING ACTIVITIES
(1,865)
(112,298)
0 
FINANCING ACTIVITIES
 
 
 
Proceeds from issuance of Class A common stock sold in initial public offering, net of underwriting discounts and commissions
0 
112,298 
0 
Proceeds from issuance of Class A common stock to SSE Holdings upon settlement of stock option exercises [Line Items]
2,489 
0 
0 
Proceeds from issuance of Class B common stock
0 
30 
0 
Proceeds from Stock Options Exercised
3,185 
0 
0 
NET CASH PROVIDED BY FINANCING ACTIVITIES
5,674 
112,328 
0 
NET CASH PROVIDED BY OPERATING ACTIVITIES
(446)
392 
0 
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
3,363 
422 
0 
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD
422 
0 
0 
CASH AND CASH EQUIVALENTS AT END OF PERIOD
3,785 
422 
0 
Parent Company |
Class A Common Stock |
IPO And Organizational Transaction
 
 
 
Non-cash investing activities:
 
 
 
Class A common stock issued
0 
6 
0 
Parent Company |
Class A Common Stock |
USC Merger
 
 
 
Non-cash investing activities:
 
 
 
Class A common stock issued
0 
2 
0 
Parent Company |
Class A Common Stock |
Secondary Offering and Redemption of Units
 
 
 
Non-cash investing activities:
 
 
 
Class A common stock issued
18,944 
19,933 
0 
Parent Company |
Class B Common Stock |
IPO And Organizational Transaction
 
 
 
Non-cash financing activities:
 
 
 
Cancellation of Class B common stock
0 
(6)
0 
Parent Company |
Class B Common Stock |
USC Merger
 
 
 
Non-cash financing activities:
 
 
 
Cancellation of Class B common stock
0 
(2)
0 
Parent Company |
Class B Common Stock |
Secondary Offering and Redemption of Units
 
 
 
Non-cash financing activities:
 
 
 
Cancellation of Class B common stock
 
$ (6)
$ 0 
SCHEDULE II: VALUATION AND QUALIFYING ACCOUNTS (Details) (Deferred tax asset valuation allowance:, USD $)
In Thousands, unless otherwise specified
12 Months Ended
Dec. 28, 2016
Dec. 30, 2015
Dec. 31, 2014
Deferred tax asset valuation allowance:
 
 
 
Movement in Valuation Allowances and Reserves [Roll Forward]
 
 
 
Balance at beginning of period
$ 23,155 
$ 0 
$ 0 
Charged to costs and expenses
90 
 
 
Charged to other accounts
1,965 
39,700 
0 
Reductions
(9,642)
(16,545)
0 
Balance at end of period
$ 15,568 
$ 23,155 
$ 0