Jack In The Box 2012 Annual Report Download - page 52
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Intangible assets, net consist of the following as of September 30, 2012 and October 2, 2011 (in thousands):
Amortized intangible assets:
Gross carrying amount
$17,319
$17,020
Less accumulated amortization
(8,913)
(8,325)
Net carrying amount
8,406
8,695
Non-amortized intangible assets:
Trademark
8,800
8,800
Net carrying amount
$17,206
$17,495
Amortized intangible assets include acquired franchise contracts recorded in connection with our acquisition of Qdoba in 2003, lease acquisition costs and
reacquired Qdoba franchise rights. The weighted-average life of these amortized intangible assets is approximately 20 years. Total amortization expense related
to intangible assets was $0.9 million, $0.8 million and $0.7 million in fiscal 2012, 2011 and 2010, respectively.
The following table summarizes, as of September 30, 2012, the estimated amortization expense for each of the next five fiscal years ( in thousands):
2013 $898
2014 846
2015 825
2016 789
2017 768
Total $4,126
Financial assets and liabilities — The following tables present the financial assets and liabilities measured at fair value on a recurring basis as of
September 30, 2012 and October 2, 2011 (in thousands):
Non-qualified deferred compensation plan (1)
$(37,523)
$(37,523)
$ —
$ —
Interest rate swaps (Note 6) (2)
(2,433)
—
(2,433)
—
Total liabilities at fair value
$(39,956)
$(37,523)
$(2,433)
$ —
Non-qualified deferred compensation plan (1)
$(34,288)
$(34,288)
$ —
$ —
Interest rate swaps (Note 6) (2)
(2,682)
—
(2,682)
—
Total liabilities at fair value
$(36,970)
$(34,288)
$(2,682)
$ —
____________________________
(1) We maintain an unfunded defined contribution plan for key executives and other members of management excluded from participation in our qualified savings plan.
The fair value of this obligation is based on the closing market prices of the participants’ elected investments.
(2) We entered into interest rate swaps to reduce our exposure to rising interest rates on our variable debt. The fair values of our interest rate swaps are based upon Level
2 inputs which include valuation models as reported by our counterparties. The key inputs for the valuation models are quoted market prices, interest rates and
forward yield curves.
(3) We did not have any transfers in or out of Level 1 or Level 2.
The fair values of the Company’s debt instruments are based on the amount of future cash flows associated with each instrument discounted using the
Company’s borrowing rate. At September 30, 2012, the carrying value of all financial instruments was not materially different from fair value, as the
borrowings are prepayable without penalty. The estimated fair values of our capital lease obligations approximated their carrying values as of September 30,
2012.
F-12