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Table of Contents
BURGER KING HOLDINGS, INC. AND SUBSIDIARIES
Notes to Consolidated Financial Statements — (Continued)
Assumptions
The weighted−average assumptions used in computing the benefit obligations of the U.S. Pension Plans and U.S. Medical Plan are
as follows:
International U.S. Medical
U.S. Pension Plan Pension Plans Plan
2010 2009 2008 2010 2009 2008 2010 2009 2008
Discount rate as of
year−end 5.20% 6.37% 6.10% 5.17% 6.00% 6.10% 5.20% 6.37% 6.10%
Range of
compensation rate
increase N/A* N/A* N/A* 3.71% 3.53% 4.15% N/A N/A N/A
* The Company curtailed the U.S Pension Plans during the year ended June 30, 2006.
The discount rate used in the calculation of the benefit obligation at June 30, 2010 for the U.S. Plans is derived from a yield curve
comprised of the yields of an index of 250 equally−weighted corporate bonds, rated AA or better by Moody’s, which approximates the
duration of the U.S. Plans.
The weighted−average assumptions used in computing the net periodic benefit cost of the U.S. Pension Plans and the
U.S. Medical Plan are as follows:
International U.S. Medical
U.S. Pension Plans Pension Plans Plan
2010 2009 2008 2010 2009 2008 2010 2009 2008
Discount rate 6.37% 6.10% 6.07% 6.07% 5.89% 5.39% 6.37% 6.10% 6.07%
Range of compensation
rate increase N/A* N/A* N/A* 3.57% 3.88% 3.61% N/A N/A N/A
Expected long−term rate
of return on plan assets 7.50% 8.25% 8.25% 6.42% 6.51% 7.00% N/A N/A N/A
* The Company curtailed the U.S Pension Plans during the year ended June 30, 2006.
The expected long−term rate of return on plan assets is determined by expected future returns on the asset categories in target
investment allocation. These expected returns are based on historical returns for each asset’s category adjusted for an assessment of
current market conditions.
The assumed healthcare cost trend rates are as follows:
Years Ended June 30,
2010 2009 2008
Healthcare cost trend rate assumed for next year 8.00% 8.50% 9.00%
Rate to which the cost trend rate is assumed to decline (the ultimate trend rate) 5.00% 5.00% 5.00%
Year that the rate reaches the ultimate trend rate 2020 2016 2016
Assumed healthcare cost trend rates do not have a significant effect on the amounts reported for the postretirement healthcare
plans, since a one−percentage point increase or decrease in the assumed healthcare cost trend rate would have a minimal effect on
service and interest cost and the postretirement obligation.
105