- The audit committee reviewed the selection, application and disclosure of critical accounting
policies; - The audit committee reviewed the Company’s earnings press releases prior to issuance;
- The audit committee reviewed and discussed the Company’s Audited Financial Statements for
the 2018 fiscal year with management and the independent auditors; - As mentioned above, the audit committee reviewed the Company’s Quarterly and Annual
Reports on Form 10-Q and Form 10-K prior to filing with the SEC; - The audit committee evaluated the appointment, compensation, retention and oversight of
KPMG LLP. In connection with such appointment, the audit committee evaluated the service
level of the incumbent independent auditor, which included criteria such as prior year quality of
service, industry and technical expertise, independence, resource availability, and reasonableness
and competitiveness of fees, as well as solicited the input of key management employees during
its evaluation; and - Based on the review and discussion referred to above, and in reliance thereon, the audit committee
recommended to the Board that the Audited Financial Statements be included in the Company’s
Annual Report on Form 10-K for the fiscal year ended December 25, 2018, for filing with the SEC.
All members of the audit committee concur in this report.
Gregory N. Moore, Chair
Curtis A. Warfield
James R. Zarley
Related Party Transactions
The audit committee’s charter provides that the audit committee will review and approve any
transactions between us and any of our executive officers, non-employee directors, and 5% shareholders,
or any members of their immediate families, in which the amount involved exceeds the threshold limits
established by the regulations of the SEC. In reviewing a related-party transaction, the audit committee
considers the material terms of the transaction, including whether the terms are generally available to an
unaffiliated third party under similar circumstances. Unless specifically noted, the transactions described
below were entered into before our initial public offering and the subsequent formation of the audit
committee.
Grants of Franchise or License Rights
We have licensed or franchised restaurants to companies owned in part by certain Named Executive
Officers. The licensing or franchise fees paid by these companies to us range from 0.0% to 4.0% of
restaurant sales, which is the amount we typically charge to franchisees. We believe that allowing certain
Named Executive Officers with ownership interests in our restaurants that pre-dated our initial public
offering to continue to maintain those ownership interests adds an ongoing benefit to the Company by