Jack In The Box 2008 Annual Report Download - page 36

Pursuant to a stock repurchase program authorized by the Board of Directors in 2005, we repurchased
1.5 million and 1.4 million shares of our common stock for $100.0 million and $50.0 million during 2007 and 2006,
respectively.
Off-balance sheet arrangements. Other than operating leases, we are not a party to any off-balance sheet
arrangements that have, or are reasonably likely to have, a current or future material effect on our financial
condition, changes in financial condition, results of operations, liquidity, capital expenditures or capital resources.
We finance a portion of our new restaurant development through sale-leaseback transactions. These transactions
involve selling restaurants to unrelated parties and leasing the restaurants back. Additional information regarding
our operating leases is available in Item 2, Properties, and Note 4, Leases, of the notes to the consolidated financial
statements.
Contractual obligations and commitments. The following is a summary of our contractual obligations and
commercial commitments as of September 28, 2008 (in thousands):
Total Less than 1 Year 1-3 Years 3-5 Years After 5 Years
Payments Due by Year
Contractual Obligations:
Credit facility term loan(1) ....... $ 475,210 $ 17,471 $143,490 $314,249 $ —
Revolving credit facility(1) ........ 106,924 4,891 102,033 — —
Capital lease obligations(1) ....... 18,773 3,487 4,481 3,479 7,326
Other long-term debt obligations(1)
.......................... 55 55 — — —
Operating lease obligations ....... 1,850,929 201,339 363,016 319,049 967,525
Purchase commitments(2) ........ 924 636 263 25 —
Benefit obligations(3) . . . ........ 132,838 11,749 18,879 22,061 80,149
Total contractual obligations ..... $2,585,653 $239,628 $632,162 $658,863 $1,055,000
Other Commercial Commitments:
Stand-by letters of credit(4) ....... $ 35,512 $ 35,512 $ — $ — $ —
(1) Obligations related to our credit facility, capital lease obligations, and other long-term debt obligations include
interest expense estimated at interest rates in effect on September 28, 2008.
(2) Includes purchase commitments for food, beverage, packaging items and certain utilities.
(3) Includes expected payments associated with our defined benefit plans, postretirement benefit plans and our
non-qualified deferred compensation plan through fiscal 2017.
(4) Consists primarily of letters of credit for workers’ compensation and general liability insurance.
DISCUSSION OF CRITICAL ACCOUNTING ESTIMATES
We have identified the following as our most critical accounting estimates, which are those that are most
important to the portrayal of the Company’s financial condition and results and require management’s most
subjective and complex judgments. Information regarding our other significant accounting estimates and policies
are disclosed in Note 1 to our consolidated financial statements.
Share-based Compensation — We account for share-based compensation in accordance with SFAS 123R.
Under the provisions of SFAS 123R, share-based compensation cost is estimated at the grant date based on the
award’s fair-value as calculated by an option pricing model and is recognized as expense ratably over the requisite
service period. The option pricing models require various highly judgmental assumptions including volatility,
forfeiture rates, and expected option life. If any of the assumptions used in the model change significantly, share-
based compensation expense may differ materially in the future from that recorded in the current period.
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