Jack In The Box 2006 Annual Report Download - page 63

Download and view the complete annual report

Please find page 63 of the 2006 Jack In The Box annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 88

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88

JACK IN THE BOX INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Dollars in thousands, except per share data)
F-13
3. INTANGIBLE ASSETS
Intangible assets consist of the following as of October 1, 2006 and October 2, 2005:
2006 2005
Amortized intangible assets:
Gross carrying amount ................................................................................................. $ 59,151 $ 60,181
Less accumulated amortization.................................................................................... (46,930) (46,888)
Net carrying amount..................................................................................................... $ 12,221 $ 13,293
Unamortized intangible assets:
Goodwill.......................................................................................................................
.
$ 92,187 $ 92,187
Trademark..................................................................................................................... 8,800 8,800
$ 100,987 $ 100,987
Amortized intangible assets include lease acquisition costs and acquired franchise contracts. The weighted-
average life of the amortized intangible assets is approximately 26 years. Total amortization expense related to
intangible assets was $1,048, $1,173 and $1,260 in fiscal years 2006, 2005 and 2004, respectively. The estimated
amortization expense for each year from fiscal year 2007 through 2011 is $935, $788, $757, $742 and $741,
respectively.
There were no changes to goodwill during fiscal year 2006. The changes in the carrying amount of goodwill
during fiscal year 2005 were as follows:
JACK IN THE BOX Qdoba Total
Balance at October 3, 2004 ................................................................... $ 66,601 $ 23,617 $ 90,218
Goodwill acquired ................................................................................ 1,267 702 1,969
Balance at October 2, 2005 ................................................................... $ 67,868 $ 24,319 $ 92,187
During fiscal year 2005, aggregate goodwill of $1,969 was recorded in connection with the acquisition of one
JACK IN THE BOX franchised restaurant and three Qdoba franchised restaurants.
4. LONG-TERM DEBT
2006 2005
The detail of long-term debt at each year-end follows:
Term loan, variable interest rate based on an applicable margin plus LIBOR, 6.89%
at October 1, 2006, quarterly payments of $688 through January 29, 2010 and
subsequent quarterly payments of $64,625 through January 8, 2011.............................
.
$ 268,125 $ 270,875
Capital lease obligations, 8.19% average interest rate .....................................................
.
23,175 26,315
Other notes, principally unsecured, 9.55% average interest rate......................................
.
470 811
291,770 298,001
Less current portion..........................................................................................................
.
(37,539) (7,788)
$ 254,231 $ 290,213
Credit facility — Our credit facility is comprised of: (i) a $200,000 revolving credit facility maturing on January
8, 2008 with a rate of London Interbank Offered Rate (“LIBOR”) plus 2.25% and (ii) a $268,125 term loan
maturing on January 8, 2011 with a rate of LIBOR plus 1.50%. The credit facility requires the payment of an
annual commitment fee of 0.375% of the unused portion of the credit facility. The annual commitment rate and
the credit facility’ s interest rates are based on a financial leverage ratio, as defined in the credit agreement. The
credit facility also requires prepayments of the term loan based on an excess cash flow calculation as defined in
the credit agreement. At October 1, 2006, the excess cash flow calculation requires a payment of $29,109 which
has been classified as current in the Company’ s consolidated balance sheet. The Company and certain of its
subsidiaries granted liens in substantially all personal property assets to secure our respective obligations under
the credit facility. The credit agreement may also require certain of the Company’ s real property assets to be
pledged as collateral in the event of a ratings downgrade as defined in the credit agreement. Additionally, certain
of our real and personal property secure other indebtedness of the Company. At October 1, 2006, we had no
borrowings under our revolving credit facility and had letters of credit outstanding against our credit facility of
$283.