Jack In The Box 2005 Annual Report Download - page 62

JACK IN THE BOX INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Dollars in thousands, except per share data)
(continued)
8. RETIREMENT AND SAVINGS PLANS (continued)
Plan assets – As of October 2, 2005, our target asset allocation was 41% U.S. equities, 38% debt securities, 15%
international equities and 6% balanced fund. We regularly monitor our asset allocation to ensure it approximates our target
allocation, and senior financial management and the Finance Committee of the Board of Directors review performance
results at least quarterly. We believe our long-term asset allocation will continue to approximate our target allocation. The
qualified plans had the following asset allocations at June 30, 2005 and June 30, 2004:
2005 2004
U.S. equities................................................................................................................. 41% 41%
International equities.................................................................................................... 15 9
Debt securities.............................................................................................................. 38 34
Balanced fund .............................................................................................................. 6 5
Cash (1) ........................................................................................................................ –
11
100% 100%
(1) We made a contribution to the qualified plans on June 30, 2004 that approximated 10% of the plans’ assets. This cash contribution was
allocated to the appropriate asset classes on the next business day, July 1, 2004.
Future cash flows - During fiscal year 2006, we currently expect to contribute approximately $11,000 to our qualified plans
and $2,000 to our non-qualified plan. Total qualified and non-qualified plan pension benefits expected to be paid in each
year from fiscal year 2006 through 2010 are $4,586, $4,894, $5,354, $5,914 and $6,484, respectively. The aggregate
expected benefits to be paid in the five fiscal years from 2011 through 2015 are $44,316. Expected benefits to be paid are
based on the same assumptions used to measure our benefit obligation at October 2, 2005 and include estimated future
employee service.
Defined contribution plans - We maintain savings plans pursuant to Section 401(k) of the Internal Revenue Code which
allows administrative and clerical employees who have satisfied the service requirements and reached age 21, to defer a
percentage of their pay on a pre-tax basis. We contribute an amount equal to 50% of the first 4% of compensation that is
deferred by the participant. Our contributions under these plans were $1,815, $1,940 and $1,874 in 2005, 2004 and 2003,
respectively. We also maintain an unfunded, non-qualified deferred compensation plan, which was created in 1990 for key
executives and other members of management who are excluded from participation in the qualified savings plan. This plan
allows participants to defer up to 50% of their salary and 100% of their bonus, on a pre-tax basis. We match an amount
equal to 100% of the first 3% contributed by the employee. Our contributions under the non-qualified deferred
compensation plan were $1,091, $645 and $685 in 2005, 2004 and 2003, respectively. In each plan, a participant’ s right to
Company contributions vests at a rate of 25% per year of service.
Company-owned life insurance – We have elected to purchase company-owned life insurance policies to support our non-
qualified benefit plans. The cash surrender value of these policies was $43,741 and $33,310 as of October 2, 2005 and
October 3, 2004, respectively. A portion of these policies reside in an umbrella trust for use only to pay plan benefits to
participants or, if the Company becomes insolvent, to pay creditors. The cash surrender value of those policies covered
under the trust was $22,927 and $21,183 as of October 2, 2005 and October 3, 2004, respectively. The trust also includes
cash of $831 and $850 as of October 2, 2005 and October 3, 2004, respectively.
Non-management directors’ deferred compensation plan - We maintain a deferred compensation plan for non-management
directors. Under the plan’ s equity option, those who are eligible to receive directors’ fees or retainers may choose to defer
receipt of their compensation. The amounts deferred are converted into stock equivalents at the current market price of our
common stock. We provide a deferment credit equal to 25% of the compensation initially deferred. Under this plan, our
liability is adjusted at the end of each reporting period to reflect the then-current market price of our common stock. In
2005, 2004 and 2003, we expensed (credited) a total of $280, $1,550 and $(95), respectively, for both the deferment credit
and the stock appreciation (depreciation) on the deferred compensation.
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