Panera Bread 2008 Annual Report Download - page 82

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15. Deposits and Other
Deposits and other consisted of the following (in thousands):
December 30,
2008
December 25,
2007
Deferred income taxes ..................................... $3,349 $1,980
Deposits ............................................... 2,869 2,718
Deferred financing costs .................................... 1,125 206
Company-owned life insurance program ........................ 1,031 2,214
Note receivable .......................................... 589 599
Total deposits and other .................................... $8,963 $7,717
The Company established a company-owned life insurance (“COLI”) program covering a substantial portion
of its employees to help manage long-term employee benefit cost and to obtain tax deductions on interest payments
on insurance policy loans. However, due to tax law changes, the Company froze this program in 1998. Based on
current actuarial estimates, the program is expected to end in 2010.
At December 30, 2008 and December 25, 2007, the cash surrender values of $1.7 million and $2.7 million,
respectively, the mortality income receivables of $1.0 million and $2.2 million, respectively, and the insurance
policy loans of $1.7 million and $2.7 million, respectively, related to the COLI program were netted and included in
deposits and other assets in the Company’s Consolidated Balance Sheets. Mortality income receivable represents
the dividend or death benefits the Company is due from its insurance carrier at the respective dates. The insurance
policy loans are collateralized by the cash values of the underlying life insurance policies and require interest
payments at a rate of 9.08 percent for the year ended December 30, 2008. Interest accrued on insurance policy loans
is netted with other COLI related income statement transactions in other (income) expense, net in the Consolidated
Statements of Operations, which netted $0.1 million, $0.5 million, and $0.1 million in fiscal years 2008, 2007, and
2006, respectively.
16. Stockholders’ Equity
Common Stock
The holders of Class A common stock are entitled to one vote for each share owned. The holders of Class B
common stock are entitled to three votes for each share owned. Each share of Class B common stock has the same
dividend and liquidation rights as each share of Class A common stock. Each share of Class B common stock is
convertible, at the stockholder’s option, into Class A common stock on a one-for-one basis. At December 30, 2008,
the Company had reserved 3,502,851 shares of its Class A common stock for issuance upon exercise of awards
granted under the Company’s 1992 Equity Incentive Plan, Formula Stock Option Plan for Independent Directors,
2001 Employee, Director, and Consultant Stock Option Plan, and the 2006 Stock Incentive Plan, and upon
conversion of Class B common stock.
Registration Rights
At December 30, 2008, 93.8 percent of the Class B common stock is owned by the Company’s Chairman and
Chief Executive Officer (“CEO”). Certain holders of Class B common stock, including the Company’s CEO,
pursuant to stock subscription agreements, can require the Company under certain circumstances to register their
shares under the Securities Exchange Act of 1933, or have included in certain registrations all or part of such shares
at the Company’s expense.
75
PANERA BREAD COMPANY
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS — (Continued)