UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☑ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended ~~April 11, 2021~~January 23, 2022

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

for the transition period from ________to________.

Commission File Number: 1-9390

JACK IN THE BOX INC.

(Exact name of registrant as specified in its charter)

_______________________________________________________________________________________

Delaware

95-2698708

(State of Incorporation)

(I.R.S. Employer Identification No.)

9357 Spectrum Center Blvd.

San Diego, California 92123

(Address of principal executive offices)

Registrant’s telephone number, including area code (858) 571-2121

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock	JACK	NASDAQ Global Select Market

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes þ No ¨

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

Yes þ No ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.


Large accelerated filer	þ	Smaller reporting company	☐
Accelerated filer	☐	Emerging growth company	☐
Non-accelerated filer	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes ☐ No þ

As of the close of business ~~May 7, 2021, 22,228,146~~February 17, 2022, 21,043,499 shares of the registrant’s common stock were outstanding.

JACK IN THE BOX INC. AND SUBSIDIARIES

INDEX


		Page
	PART I – FINANCIAL INFORMATION
Item 1.	Condensed Consolidated Financial Statements (Unaudited):
	Condensed Consolidated Balance Sheets	2
	Condensed Consolidated Statements of Earnings	3
	Condensed Consolidated Statements of Comprehensive Income	4
	Condensed Consolidated Statements of Cash Flows	5
	Notes to Condensed Consolidated Financial Statements	6
Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	15
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	2827
Item 4.	Controls and Procedures	2827
	PART II – OTHER INFORMATION
Item 1.	Legal Proceedings	2928
Item 1A.	Risk Factors	2928
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	2930
Item 3.	Defaults of Senior Securities	2930
Item 4.	Mine Safety Disclosures	2930
Item 5.	Other Information	2930
Item 6.	Exhibits	3031
	Signature	3132

PART I. FINANCIAL INFORMATION

ITEM 1. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

JACK IN THE BOX INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands, except share and per share data)

(Unaudited)

April 11,
2021 September 27,
2020
ASSETS
Current assets:
Cash $ 90,637 $ 199,662
Restricted cash 18,137 37,258
Accounts and other receivables, net 86,721 78,417
Inventories 2,158 1,808
Prepaid expenses 6,784 10,114
Current assets held for sale 3,883 4,598
Other current assets 3,703 3,724
Total current assets 212,023 335,581
Property and equipment:
Property and equipment, at cost 1,144,503 1,132,430
Less accumulated depreciation and amortization (812,489) (796,448)
Property and equipment, net 332,014 335,982
Other assets:
Operating lease right-of-use assets 914,010 904,548
Intangible assets, net 262 277
Goodwill 47,161 47,161
Deferred tax assets 71,167 72,322
Other assets, net 214,138 210,623
Total other assets 1,246,738 1,234,931
$ 1,790,775 $ 1,906,494
LIABILITIES AND STOCKHOLDERS’ DEFICIT
Current liabilities:
Current maturities of long-term debt $ 850 $ 818
Current operating lease liabilities 153,297 179,000
Accounts payable 24,695 31,105
Accrued liabilities 123,550 129,431
Total current liabilities 302,392 340,354
Long-term liabilities:
Long-term debt, net of current maturities 1,271,412 1,376,913
Long-term operating lease liabilities, net of current portion 792,183 776,094
Other long-term liabilities 205,345 206,494
Total long-term liabilities 2,268,940 2,359,501
Stockholders’ deficit:
Preferred stock $0.01 par value, 15,000,000 shares authorized, NaN issued 0 0
Common stock $0.01 par value, 175,000,000 shares authorized, 82,510,007 and 82,369,714 issued, respectively 825 824
Capital in excess of par value 496,798 489,515
Retained earnings 1,704,766 1,636,211
Accumulated other comprehensive loss (108,640) (110,605)
Treasury stock, at cost, 60,287,482 and 59,646,773 shares, respectively (2,874,306) (2,809,306)
Total stockholders’ deficit (780,557) (793,361)
$ 1,790,775 $ 1,906,494


	January 23, 2022		October 3, 2021
ASSETS
Current assets:
Cash	$	70,207	$	55,346
Restricted cash	18,259		18,222
Accounts and other receivables, net	55,220		74,335
Inventories	2,686		2,335
Prepaid expenses	10,073		12,682
Current assets held for sale	1,881		1,692
Other current assets	4,230		4,346
Total current assets	162,556		168,958
Property and equipment:
Property and equipment, at cost	1,127,989		1,133,038
Less accumulated depreciation and amortization	(813,346)		(810,124)
Property and equipment, net	314,643		322,914
Other assets:
Operating lease right-of-use assets	956,068		934,066
Intangible assets, net	403		470
Goodwill	48,047		47,774
Deferred tax assets	48,339		51,517
Other assets, net	228,540		224,438
Total other assets	1,281,397		1,258,265
	$	1,758,596	$	1,750,137
LIABILITIES AND STOCKHOLDERS’ DEFICIT
Current liabilities:
Current maturities of long-term debt	$	914	$	894
Current operating lease liabilities	150,089		150,636
Accounts payable	22,461		29,119
Accrued liabilities	104,450		148,417
Total current liabilities	277,914		329,066
Long-term liabilities:
Long-term debt, net of current maturities	1,274,772		1,273,420
Long-term operating lease liabilities, net of current portion	841,957		809,191
Other long-term liabilities	150,017		156,342
Total long-term liabilities	2,266,746		2,238,953
Stockholders’ deficit:
Preferred stock $0.01 par value, 15,000,000 shares authorized, none issued	—		—
Common stock $0.01 par value, 175,000,000 shares authorized, 82,563,579 and 82,536,059 issued, respectively	826		825
Capital in excess of par value	501,570		500,441
Retained earnings	1,794,362		1,764,412
Accumulated other comprehensive loss	(73,516)		(74,254)
Treasury stock, at cost, 61,523,475 shares	(3,009,306)		(3,009,306)
Total stockholders’ deficit	(786,064)		(817,882)
	$	1,758,596	$	1,750,137

See accompanying notes to condensed consolidated financial statements.

JACK IN THE BOX INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS

(In thousands, except per share data)

(Unaudited)

Quarter Year-to-date
April 11,
2021 April 12,
2020 April 11,
2021 April 12,
2020
Revenues:
Company restaurant sales $ 85,962 $ 74,380 $ 200,240 $ 179,744
Franchise rental revenues 77,901 69,885 181,650 165,969
Franchise royalties and other 47,231 37,764 106,879 90,230
Franchise contributions for advertising and other services 46,123 34,128 106,989 87,887
257,217 216,157 595,758 523,830
Operating costs and expenses, net:
Food and packaging 23,938 22,237 56,315 53,585
Payroll and employee benefits 26,440 24,261 61,371 56,151
Occupancy and other 13,349 12,570 31,184 28,528
Franchise occupancy expenses 48,904 48,341 114,073 112,858
Franchise support and other costs 3,341 2,971 6,614 7,647
Franchise advertising and other services expenses 47,104 35,734 109,799 90,958
Selling, general and administrative expenses 18,861 24,203 39,360 52,451
Depreciation and amortization 10,696 12,282 25,267 29,010
Impairment and other charges (gains), net 1,228 716 776 (8,575)
Gains on the sale of company-operated restaurants (1,532) 0 (2,815) (1,575)
192,329 183,315 441,944 421,038
Earnings from operations 64,888 32,842 153,814 102,792
Other pension and post-retirement expenses, net 203 512 474 39,490
Interest expense, net 15,227 15,409 35,962 35,351
Earnings before income taxes 49,458 16,921 117,378 27,951
Income taxes 13,524 5,458 30,585 8,591
Net earnings $ 35,934 $ 11,463 $ 86,793 $ 19,360
Earnings per share:
Basic $ 1.58 $ 0.50 $ 3.80 $ 0.83
Diluted $ 1.58 $ 0.50 $ 3.78 0.82
Dividends declared per common share $ 0.40 $ 0.40 $ 0.80 $ 0.80


	Sixteen Weeks Ended
	January 23, 2022		January 17, 2021
Revenues:
Company restaurant sales	$	120,056	$	114,278
Franchise rental revenues	103,099		103,749
Franchise royalties and other	60,755		59,648
Franchise contributions for advertising and other services	60,801		60,866
	344,711		338,541
Operating costs and expenses, net:
Food and packaging	37,537		32,377
Payroll and employee benefits	39,725		34,931
Occupancy and other	20,877		17,835
Franchise occupancy expenses	63,983		65,169
Franchise support and other costs	3,911		3,273
Franchise advertising and other services expenses	63,308		62,695
Selling, general and administrative expenses	25,339		20,499
Depreciation and amortization	12,496		14,571
Other operating expenses (income), net	3,843		(452)
Gains on the sale of company-operated restaurants	(48)		(1,283)
	270,971		249,615
Earnings from operations	73,740		88,926
Other pension and post-retirement expenses, net	93		271
Interest expense, net	20,187		20,735
Earnings before income taxes	53,460		67,920
Income taxes	14,190		17,061
Net earnings	$	39,270	$	50,859

Earnings per share:
Basic	$	1.85	$	2.21
Diluted	$	1.85	$	2.21

Cash dividends declared per common share	$	0.44	$	0.40

See accompanying notes to condensed consolidated financial statements.

JACK IN THE BOX INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME ~~(LOSS)~~

(In thousands)

(Unaudited)

Quarter Year-to-date
April 11,
2021 April 12,
2020 April 11,
2021 April 12,
2020
Net earnings $ 35,934 $ 11,463 $ 86,793 $ 19,360
Other comprehensive income (loss):
Actuarial losses arising during the period 0 (61,090) 0 (32,507)
Actuarial losses and prior service costs reclassified to earnings 1,138 1,362 2,655 41,672
1,138 (59,728) 2,655 9,165
Tax effect (296) 15,503 (690) (2,379)
Other comprehensive income (loss), net of taxes 842 (44,225) 1,965 6,786
Comprehensive income (loss) $ 36,776 $ (32,762) $ 88,758 $ 26,146


	Sixteen Weeks Ended
	January 23, 2022		January 17, 2021
Net earnings	$	39,270	$	50,859
Other comprehensive income:

Actuarial losses and prior service costs reclassified to earnings	996		1,517
	996		1,517
Tax effect	(258)		(394)
Other comprehensive income, net of taxes	738		1,123

Comprehensive income	$	40,008	$	51,982

See accompanying notes to condensed consolidated financial statements.

JACK IN THE BOX INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

(Unaudited)

Year-to-date
April 11,
2021 April 12,
2020
Cash flows from operating activities:
Net earnings $ 86,793 $ 19,360
Adjustments to reconcile net earnings to net cash provided by operating activities:
Depreciation and amortization 25,267 29,010
Amortization of franchise tenant improvement allowances and other 1,534 1,765
Deferred finance cost amortization 3,013 3,046
Excess tax benefit from share-based compensation arrangements (1,112) (77)
Deferred income taxes (882) 6,783
Share-based compensation expense 2,836 5,865
Pension and post-retirement expense 474 39,490
(Gains) losses on cash surrender value of company-owned life insurance (9,352) 3,150
Gains on the sale of company-operated restaurants (2,815) (1,575)
Gains on the disposition of property and equipment, net (1,931) (10,170)
Non-cash operating lease costs (11,870) (13,118)
Impairment charges and other 1,340 133
Changes in assets and liabilities, excluding acquisitions:
Accounts and other receivables (4,490) (22,858)
Inventories (288) 28
Prepaid expenses and other current assets 3,461 (10,350)
Accounts payable (14,614) 20,660
Accrued liabilities 6,499 1,400
Pension and post-retirement contributions (3,577) (3,582)
Franchise tenant improvement allowance disbursements (567) (5,811)
Other (1,175) (4,222)
Cash flows provided by operating activities 78,544 58,927
Cash flows from investing activities:
Purchases of property and equipment (22,928) (12,777)
Proceeds from the sale of property and equipment 3,629 22,394
Proceeds from the sale and leaseback of assets 0 17,373
Proceeds from the sale of company-operated restaurants 965 1,575
Other 2,616 1,036
Cash flows (used in) provided by investing activities (15,718) 29,601
Cash flows from financing activities:
Borrowings on revolving credit facilities 0 111,376
Repayments of borrowings on revolving credit facilities (107,875) (3,500)
Principal repayments on debt (415) (3,640)
Debt issuance costs 0 (216)
Dividends paid on common stock (18,130) (18,466)
Proceeds from issuance of common stock 4,340 3,559
Repurchases of common stock (65,000) (155,576)
Payroll tax payments for equity award issuances (3,892) (4,442)
Cash flows used in financing activities (190,972) (70,905)
Net (decrease) increase in cash and restricted cash (128,146) 17,623
Cash and restricted cash at beginning of period 236,920 151,561
Cash and restricted cash at end of period $ 108,774 $ 169,184


	Sixteen Weeks Ended
	January 23, 2022		January 17, 2021
Cash flows from operating activities:
Net earnings	$	39,270	$	50,859
Adjustments to reconcile net earnings to net cash provided by operating activities:
Depreciation and amortization	12,496		14,571
Amortization of franchise tenant improvement allowances and incentives	1,234		861
Deferred finance cost amortization	1,722		1,722
(Excess tax benefit) tax deficiency from share-based compensation arrangements	38		(58)
Deferred income taxes	2,317		2,452
Share-based compensation expense	1,018		1,231
Pension and post-retirement expense	93		271
Losses (gains) on cash surrender value of company-owned life insurance	579		(7,042)
Gains on the sale of company-operated restaurants	(48)		(1,283)
Gains on the disposition of property and equipment, net	(617)		(2,160)
Impairment charges and other	919		546
Changes in assets and liabilities, excluding acquisitions:
Accounts and other receivables	19,910		24,805
Inventories	(351)		(133)
Prepaid expenses and other current assets	2,720		2,595
Operating lease right-of-use assets and lease liabilities	10,218		(14,441)
Accounts payable	(5,218)		(15,078)
Accrued liabilities	(47,849)		8,791
Pension and post-retirement contributions	(2,075)		(2,061)
Franchise tenant improvement allowance and incentive disbursements	(1,166)		(813)
Other	(1,159)		(3,384)
Cash flows provided by operating activities	34,051		62,251
Cash flows from investing activities:
Purchases of property and equipment	(9,401)		(7,076)
Proceeds from the sale of property and equipment	2,245		3,629
Proceeds from the sale and leaseback of assets	1,576		—
Proceeds from the sale of company-operated restaurants	48		133
Other	(1,305)		2,677
Cash flows used in investing activities	(6,837)		(637)
Cash flows from financing activities:
Principal repayments on debt	(223)		(211)
Debt issuance costs	(2,090)		—
Dividends paid on common stock	(9,257)		(9,089)
Proceeds from issuance of common stock	49		114

Payroll tax payments for equity award issuances	(795)		(773)
Cash flows used in financing activities	(12,316)		(9,959)
Net increase in cash and restricted cash	14,898		51,655
Cash and restricted cash at beginning of period	73,568		236,920
Cash and restricted cash at end of period	$	88,466	$	288,575

See accompanying notes to condensed consolidated financial statements.

JACK IN THE BOX INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

1.BASIS OF PRESENTATION

Nature of operations — Founded in 1951, Jack in the Box Inc. (the “Company”) operates and franchises Jack in the Box® quick-service restaurants. The following table summarizes the number of restaurants as of the end of each period:


		April 11, 2021	April 12, 2020		January 23, 2022	January 17, 2021
Company-operated	Company-operated	148	144	Company-operated	165	148
Franchise	Franchise	2,080	2,102	Franchise	2,043	2,089
Total system	Total system	2,228	2,246	Total system	2,208	2,237

References to the Company throughout these notes to condensed consolidated financial statements are made using the first person notations of “we,” “us” and “our.”

Basis of presentation — The accompanying condensed consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”) and the rules and regulations of the Securities and Exchange Commission (“SEC”).

Certain prior period information on the consolidated statement of cash flows has been reclassified to conform to the current year presentation.

These financial statements should be read in conjunction with the consolidated financial statements and related notes contained in our Annual Report on Form 10-K for the fiscal year ended ~~September 27, 2020~~October 3, 2021 (“~~2020~~2021 Form 10-K”). The accounting policies used in preparing these condensed consolidated financial statements are the same as those described in our ~~2020~~2021 Form ~~10-K with the exception of the accounting standards adopted in fiscal 2021, which are described below.~~10-K.

In our opinion, all adjustments considered necessary for a fair presentation of financial condition and results of operations for these interim periods have been included. Operating results for one interim period are not necessarily indicative of the results for any other interim period or for the full year.

Segment reporting — The Company is comprised of 1 operating segment.

Fiscal year — Our fiscal year is 52 or 53 weeks ending the Sunday closest to September 30. Fiscal years 2022 and 2021 include 52 and ~~2020 include~~ 53 ~~and 52~~ weeks, respectively. Our first quarter includes 16 weeks and all other quarters include 12 weeks, with the exception of the fourth quarter of fiscal 2021, which includes 13 weeks. All comparisons between ~~2021~~2022 and ~~2020~~2021 refer to the ~~12-weeks~~16 weeks (“quarter”) ended January 23, 2022 and ~~28-weeks (“year-to-date”) ended April 11,~~January 17, 2021, ~~and April 12, 2020,~~ respectively, unless otherwise indicated.

Use of estimates — In preparing the condensed consolidated financial statements in conformity with U.S. GAAP, management is required to make certain assumptions and estimates that affect reported amounts of assets, liabilities, revenues, expenses and the disclosure of contingencies. In making these assumptions and estimates, management may from time to time seek advice and consider information provided by actuaries and other experts in a particular area. Actual amounts could differ materially from these estimates.

~~Risks and uncertainties~~ — The COVID-19 pandemic has continued to have varying degrees of disruption on our business. Throughout the pandemic substantially all of our restaurants have remained open, with the majority of our dining rooms closed and locations operating in an off-premise model, leveraging our drive-thru, carryout and delivery capabilities. We continue to prioritize the health and safety of team members and guests through adhering to all safety procedures that were implemented last year.

While we do not know the future impact COVID-19 will have on our business, or when our business will fully return to normal operations, we expect to see a continued impact from COVID-19 on our results in 2021.

Advertising costs — We administer a marketing fund ~~which~~that includes contractual contributions. In ~~2021~~2022 and ~~2020,~~2021, marketing fund contributions from franchise and company-operated restaurants were approximately 5.0% of gross revenues, with the exception of our March and April 2020 marketing fees. In response to the economic burden associated with the COVID-19 pandemic, the Company reduced March 2020 marketing fees to 4.0% and postponed the collection of these fees over the course of 24 months. April 2020 marketing fees ranged from 2% to 4% based on annualized sales volumes and these fees were collected over three months beginning October 2020. As of April 11, 2021, postponed marketing fees which remain uncollected were $5.5 million, of which $4.4 million is included within “Accounts and other receivable, net” and $1.1 million is included within “Other assets, net” in our condensed consolidated balance sheet.revenues.

Total contributions made by the Company are included in “Selling, general, and administrative expenses” in the accompanying condensed consolidated statements of earnings and for the quarter ~~and year-to-date~~ totaled ~~$4.3~~$6.1 million and ~~$10.1~~$5.8 million ~~respectively,~~ in 2022 and 2021, ~~and $3.5 million and $8.9 million, respectively, in 2020.~~

~~JACK IN THE BOX INC. AND SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)~~

respectively.

~~Restricted cash~~ — In accordance with the terms of our securitized financing facility, certain cash balances are required to be held in trust. Such restricted cash primarily represents cash collections and cash reserves held by the trustee to be used for payments of quarterly interest and commitment fees required for the Class A-1 and Class A-2 Notes. Starting in the second quarter of 2020, with uncertainty surrounding COVID-19 events, we voluntarily elected to fund cash held in trust for one additional quarterly interest and commitment fee payment. This voluntary election was discontinued in the second quarter of 2021. As of April 11, 2021 and September 27, 2020, restricted cash balances were $18.1 million and $37.3 million, respectively.

~~Effect of new~~Recent accounting pronouncements — In August 2018, the Financial Accounting Standards Board (“FASB”) issued guidance which aligns the requirements for capitalizing implementation costs in cloud computing arrangements with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software. The Company ~~adopted the standard in the first quarter of 2021. The adoption of this standard did not have a material impact to our consolidated financial statements.~~

In June 2016, the FASB issued guidance replacing the incurred loss impairment methodology with a new methodology that reflects current expected losses on financial assets, including trade accounts receivables. The new methodology requires entities to estimate and recognize credit losses each reporting period. The Company adopted the new guidance in the first quarter of 2021 using the modified retrospective method. The adoption did not have a material impact to our consolidated financial statements.

The Company closely monitors the financial condition of our franchisees and estimates the allowance for credit losses based on the lifetime expected loss on receivables. These estimates are based on historical collection experience with our franchisees as well as other factors, including current market conditions and events. Credit quality is monitored through the timing of payments compared to predefined aging criteria and known facts regarding the financial condition of the franchisee or customer. Account balances are charged off against the allowance after recovery efforts have ceased. The Company’s allowance for receivables have not historically been material.

~~The following table summarizes the activity in our allowance for doubtful accounts~~ ~~(in thousands)~~:


~~Balance as of September 27, 2020~~	$	~~(5,541)~~
~~Provision for expected credit losses~~	~~(476)~~
~~Write-offs charged against the allowance~~	19
~~Balance as of April 11, 2021~~	$	~~(5,998)~~

We reviewed all ~~other~~ recently issued accounting pronouncements and concluded that they were either not applicable or not expected to have a significant impact on our condensed consolidated financial statements.

2.REVENUE

Nature of products and services — We derive revenue from retail sales at Jack in the Box company-operated restaurants and rental revenue, royalties, advertising, and franchise and other fees from franchise-operated restaurants.

Our franchise arrangements generally provide for an initial franchise fee of $50,000 per restaurant and generally require that franchisees pay royalty and marketing fees at 5% of gross sales. ~~These arrangements~~The agreement also ~~require~~requires franchisees to pay sourcing, technology and other miscellaneous fees.

JACK IN THE BOX INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Disaggregation of revenue — The following table disaggregates revenue by primary source (in thousands):

~~JACK IN THE BOX INC. AND SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)~~


		Quarter				Year-to-date					Sixteen Weeks Ended
		April 11, 2021		April 12, 2020		April 11, 2021		April 12, 2020				January 23, 2022		January 17, 2021
Sources of revenue:	Sources of revenue:									Sources of revenue:
Company restaurant sales	Company restaurant sales	$	85,962	$	74,380	$	200,240	$	179,744	Company restaurant sales		$	120,056	$	114,278
Franchise rental revenues	Franchise rental revenues	77,901		69,885		181,650		165,969		Franchise rental revenues		103,099		103,749
Franchise royalties	Franchise royalties	43,620		36,049		100,963		86,292		Franchise royalties		57,648		57,343
Marketing fees	Marketing fees	42,317		30,550		98,093		79,385		Marketing fees		55,801		55,776
Technology and sourcing fees	Technology and sourcing fees	3,806		3,578		8,896		8,502		Technology and sourcing fees		5,000		5,090
Franchise fees and other services	Franchise fees and other services	3,611		1,715		5,916		3,938		Franchise fees and other services		3,107		2,305
Total revenue	Total revenue	$	257,217	$	216,157	$	595,758	$	523,830	Total revenue		$	344,711	$	338,541

Contract liabilities — Our contract liabilities consist of deferred revenue resulting from initial fees received from franchisees for new restaurant openings or new franchise terms, which are recognized over the franchise term. We classify these contract liabilities as “Accrued liabilities” and “Other long-term liabilities” in our condensed consolidated balance sheets.

A summary of significant changes in our contract liabilities is presented below (in thousands):


		Year-to-date					Sixteen Weeks Ended
		April 11, 2021		April 12, 2020			January 23, 2022		January 17, 2021
Deferred franchise fees at beginning of period	Deferred franchise fees at beginning of period	$	43,541	$	46,272	Deferred franchise fees at beginning of period	$	40,435	$	43,541
Revenue recognized	Revenue recognized	(3,075)		(3,061)		Revenue recognized	(1,742)		(1,779)
Additions	Additions	1,118		1,488		Additions	680		428
Deferred franchise fees at end of period	Deferred franchise fees at end of period	$	41,584	$	44,699	Deferred franchise fees at end of period	$	39,373	$	42,190

The following table reflects the estimated franchise fees to be recognized in the future related to performance obligations that are unsatisfied as of ~~April 11, 2021~~January 23, 2022 (in thousands):


Remainder of 2021		$	2,397
2022		4,812
Remainder of 2022				Remainder of 2022	$	3,362
2023	2023	4,661		2023	4,703
2024	2024	4,471		2024	4,512
2025	2025	4,241		2025	4,284
2026				2026	3,963
Thereafter	Thereafter	21,002		Thereafter	18,549
		$	41,584		$	39,373

We have applied the optional exemption, as provided for under Accounting Standards Codification Topic 606, Revenue from Contracts with Customers, which allows us to not disclose the transaction price allocated to unsatisfied performance obligations when the transaction price is a sales-based royalty.

3.DEL TACO MERGER AGREEMENT

Agreement and Plan of Merger — As previously announced, the Company entered into an Agreement and Plan of Merger dated as of December 5, 2021 (the “Merger Agreement”) with Del Taco Restaurants, Inc., a Delaware corporation (“Del Taco”), to acquire Del Taco (the “Merger”). Del Taco is the nation’s second largest Mexican quick service restaurant chain by number of restaurants and has approximately 600 restaurants across 16 states.

Subject to certain specified exceptions, at the effective time of the Merger, each share of Del Taco common stock issued and outstanding will be converted into the right to receive $12.51 in cash in a transaction valued at approximately $575.0 million, including existing debt. The transaction, which is expected to close in the first calendar quarter of 2022, is subject to certain customary closing conditions, including Del Taco’s shareholder approval and the receipt of required regulatory approvals.

JACK IN THE BOX INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

In connection with the Merger Agreement, the Company entered into a letter agreement with BofA Securities, Inc. pursuant to which BofA Securities, Inc. has agreed to provide financing for the Merger, in an amount of up to $600.0 million under the Company’s existing securitization facility. No amounts were drawn under the letter agreement, which was terminated as a result of our securitization refinancing transaction disclosed in Note 15, Subsequent Events.

The Merger Agreement provides for certain termination rights for both Jack in the Box and Del Taco and provides that, in connection with a termination of the Merger Agreement under certain specified circumstances, Del Taco will be required to pay Jack in the Box a termination fee of $14.2 million or Jack in the Box will be required to pay Del Taco a termination fee of $28.4 million.

The Company has incurred costs related to the merger of $3.0 million for the quarter, including legal, accounting, and other professional fees and expenses. These costs are included in “Other operating expenses (income), net” in the accompanying condensed consolidated statements of earnings.

4.SUMMARY OF REFRANCHISINGS AND FRANCHISE ACQUISITIONS

Refranchisings — In 2022 and 2021, ~~and 2020, 0~~no company-operated restaurants were sold to franchisees. Amounts included in “Gains on the sale of company-operated restaurants” in both periods related to resolutions of certain contingencies from the sale of restaurants in prior years.

Franchise acquisitions — In ~~fiscal~~2022 and 2021, we acquired 4 franchise restaurants in ~~connection with exercising our right of first refusal.~~each period. We account for the acquisition of franchised restaurants using the acquisition method of accounting for business combinations. The purchase price allocations were based on fair value estimates determined using significant unobservable inputs (Level 3). ~~The acquisition was~~These acquisitions were not material to our condensed consolidated financial ~~statements.~~statements in either year.

~~JACK IN THE BOX INC. AND SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)~~

4.5.LEASES

As lessor, our leases and subleases primarily consist of restaurants that have been leased to franchisees subsequent to refranchising transactions. Revenues from leasing arrangements with our franchisees are presented in “Franchise rental revenues” in the accompanying condensed consolidated statements of earnings, and the related expenses are presented in “Franchise occupancy expenses.”

The following table presents rental income (in thousands):


		Quarter				Year-to-date					Sixteen Weeks Ended
		April 11, 2021		April 12, 2020		April 11, 2021		April 12, 2020			January 23, 2022		January 17, 2021
Operating lease income - franchise	Operating lease income - franchise	$	54,142	$	54,695	$	126,384	$	127,359	Operating lease income - franchise	$	71,357	$	72,242
Variable lease income - franchise	Variable lease income - franchise	23,759		15,190		55,266		38,610		Variable lease income - franchise	31,742		31,507
Franchise rental revenues	Franchise rental revenues	$	77,901	$	69,885	$	181,650	$	165,969	Franchise rental revenues	$	103,099	$	103,749
Operating lease income - closed restaurants and other (1)	Operating lease income - closed restaurants and other (1)	$	1,360	$	1,470	$	3,225	$	3,527	Operating lease income - closed restaurants and other (1)	$	1,658	$	1,865

____________________________

(1)Primarily relates to closed restaurant properties included in ~~“Impairment and other charges (gains)~~“Other operating expenses (income), net” in our condensed consolidated statements of earnings.

JACK IN THE BOX INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

5.6.FAIR VALUE MEASUREMENTS

Financial assets and liabilities — The following table presents our financial assets and liabilities measured at fair value on a recurring basis (in thousands):


		Total		Quoted Prices in Active Markets for Identical Assets (2) (Level 1)		Significant Other Observable Inputs (2) (Level 2)		Significant Unobservable Inputs (2) (Level 3)			Total		Quoted Prices in Active Markets for Identical Assets (2) (Level 1)		Significant Other Observable Inputs (2) (Level 2)		Significant Unobservable Inputs (2) (Level 3)
Fair value measurements as of April 11, 2021:
Fair value measurements as of January 23, 2022:										Fair value measurements as of January 23, 2022:
Non-qualified deferred compensation plan (1)	Non-qualified deferred compensation plan (1)	$	18,066	$	18,066	$	0	$	0	Non-qualified deferred compensation plan (1)	$	16,366	$	16,366	$	—	$	—
Total liabilities at fair value	Total liabilities at fair value	$	18,066	$	18,066	$	0	$	0	Total liabilities at fair value	$	16,366	$	16,366	$	—	$	—
Fair value measurements as of September 27, 2020:
Fair value measurements as of October 3, 2021:										Fair value measurements as of October 3, 2021:
Non-qualified deferred compensation plan (1)	Non-qualified deferred compensation plan (1)	$	25,071	$	25,071	$	0	$	0	Non-qualified deferred compensation plan (1)	$	18,555	$	18,555	$	—	$	—
Total liabilities at fair value	Total liabilities at fair value	$	25,071	$	25,071	$	0	$	0	Total liabilities at fair value	$	18,555	$	18,555	$	—	$	—

____________________________

(1)We maintain an unfunded defined contribution plan for key executives and other members of management. The fair value of this obligation is based on the closing market prices of the participants’ elected investments. The obligation is included in “Accrued liabilities” and “Other long-term liabilities” on our condensed consolidated balance sheets.

(2)We did not have any transfers in or out of Level 1, 2 or 3.

The following table presents the carrying value and estimated fair value of our Class A-2 Notes as of ~~April 11,~~January 23, 2022 and October 3, 2021 ~~and September 27, 2020~~ (in thousands):

April 11,
2021 September 27,
2020
Carrying Amount Fair Value Carrying Amount Fair Value
Class A-2 Notes $ 1,290,251 $ 1,355,044 $ 1,290,251 $ 1,354,241


	January 23, 2022				October 3, 2021
	Carrying Amount		Fair Value		Carrying Amount		Fair Value
Class A-2 Notes	$	1,290,251	$	1,324,810	$	1,290,251	$	1,351,057

The fair value of the Class A-2 Notes was estimated using Level 2 inputs based on quoted market prices in markets that are not considered active markets.

Non-financial assets and liabilities — Our non-financial instruments, which primarily consist of property and equipment, operating lease right-of-use assets, goodwill and intangible assets, are reported at carrying value and are not required to be measured at fair value on a recurring basis. However, on an annual basis, or whenever events or changes in circumstances indicate that their carrying value may not be recoverable, non-financial instruments are assessed for impairment. If applicable, the carrying values are written down to fair value.

In connection with our impairment reviews performed during ~~2021,~~2022, no material fair value adjustments were required.

~~JACK IN THE BOX INC. AND SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)~~

6.7.~~IMPAIRMENT AND~~ OTHER ~~CHARGES (GAINS)~~OPERATING EXPENSE (INCOME), NET

~~Impairment and other charges (gains)~~Other operating expenses (income), net in the accompanying condensed consolidated statements of earnings is comprised of the following (in thousands):

Quarter Year-to-date
April 11,
2021 April 12,
2020 April 11,
2021 April 12,
2020
Costs of closed restaurants and other (1) $ 441 $ 331 $ 1,464 $ 432
Restructuring costs (2) 118 4 1,163
Losses (gains) on disposition of property and equipment, net (2) 229 267 (1,931) (10,170)
Accelerated depreciation 560 0 1,239 0
$ 1,228 $ 716 $ 776 $ (8,575)


	Sixteen Weeks Ended
	January 23, 2022		January 17, 2021
Acquisition, integration, and restructuring costs (1)	$	3,013	$	6
Costs of closed restaurants and other (2)	1,072		1,023
Accelerated depreciation	375		679
Gains on disposition of property and equipment, net (3)	(617)		(2,160)
	$	3,843	$	(452)

____________________________

(1)Acquisition and integration costs in connection with the Del Taco transaction. Refer to Note 3 for further information.

(2)Costs of closed restaurants primarily include impairment charges as a result of our decision to close restaurants, ongoing costs associated with closed restaurants, and canceled project costs.

~~(2)~~(3)~~Year-to-date 2021, includes gains~~Gains on ~~the sale~~disposition of ~~two real estate properties. Year-to-date 2020, includes a $10.8 million gain related~~property and equipment, net, in both periods primarily relate to the sale of ~~one of our corporate office buildings.~~restaurant properties.

JACK IN THE BOX INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

7.8.INCOME TAXES

The income tax provisions reflect tax rates of ~~27.3%~~26.5% in ~~the second quarter~~2022 and ~~26.1% year-to-date, compared with 32.3% and 30.7%, respectively,~~25.1% in ~~fiscal year 2020.~~2021. The major ~~components~~component of the year-over-year ~~decrease~~increase in tax rates ~~were a decrease~~was the non-deductibles losses in the ~~impact of non-deductible compensation for certain officers, an increase~~current year versus non-taxable gains in ~~non-taxable gains~~the prior year from the market performance of insurance products used to fund certain non-qualified retirement plans, and a decrease in non-deductible costs resulting from a California Private Attorney General Act lawsuit settled in the prior year, partially offset by an adjustment related to state taxes recorded in the second quarter of fiscal year 2021.plans.

8.9.RETIREMENT PLANS

Defined benefit pension plans — We sponsor 2 defined benefit pension plans, a frozen “Qualified Plan” covering substantially all full-time employees hired prior to January 1, 2011, and an unfunded supplemental executive retirement plan (“SERP”) which provides certain employees additional pension benefits and was closed to new participants effective January 1, 2007. Benefits under both plans are based on the employee’s years of service and compensation over defined periods of employment.

In the fourth quarter of 2019, the Company amended its Qualified Plan to add a limited lump sum payment window whereby certain terminated participants with a vested pension benefit could elect to receive either an immediate lump sum or a monthly annuity payment of their accrued benefit. The offering period began September 16, 2019 and ended October 31, 2019. The participants that elected a lump sum benefit under the program were paid in December 2019, which triggered settlement accounting. As a result of the offering, the Company’s Qualified Plan paid $122.3 million from its plan assets to those who accepted the offer, thereby reducing the plan’s pension benefit obligation. The transaction had no cash impact to the Company but did result in a non-cash settlement charge of $38.6 million in the first quarter of fiscal 2020. Routine lump sum payments made in the second quarter of fiscal 2020 resulted in a non-settlement charge of $0.3 million.

Post-retirement healthcare plans — We also sponsor 2 healthcare plans, closed to new participants, that provide post-retirement medical benefits to certain employees who have met minimum age and service requirements. The plans are contributory, with retiree contributions adjusted annually, and they contain other cost-sharing features such as deductibles and coinsurance.

~~JACK IN THE BOX INC. AND SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)~~

Net periodic benefit cost — The components of net periodic benefit cost in each period were as follows (in thousands):


		Quarter				Year-to-date					Sixteen Weeks Ended
		April 11, 2021		April 12, 2020		April 11, 2021		April 12, 2020				January 23, 2022		January 17, 2021
Defined benefit pension plans:	Defined benefit pension plans:									Defined benefit pension plans:
Interest cost	Interest cost	$	3,398	$	3,669	$	7,930	$	8,745	Interest cost		$	4,517	$	4,532
Expected return on plan assets	Expected return on plan assets	(4,463)		(4,706)		(10,414)		(11,362)		Expected return on plan assets		(5,570)		(5,951)
Pension settlements (1)		0		321		0		38,927
Actuarial losses (1)	Actuarial losses (1)	1,213		1,019		2,829		2,691		Actuarial losses (1)		1,187		1,616
Amortization of unrecognized prior service costs (1)	Amortization of unrecognized prior service costs (1)	4		19		10		45		Amortization of unrecognized prior service costs (1)		6		6
Net periodic benefit cost	Net periodic benefit cost	$	152	$	322	$	355	$	39,046	Net periodic benefit cost		$	140	$	203
Post-retirement healthcare plans:	Post-retirement healthcare plans:									Post-retirement healthcare plans:
Interest cost	Interest cost	$	130	$	187	$	303	$	435	Interest cost		$	150	$	173
Actuarial (gains) losses (1)		(79)		3		(184)		9
Actuarial gains (1)										Actuarial gains (1)		(197)		(105)
Net periodic benefit cost	Net periodic benefit cost	$	51	$	190	$	119	$	444	Net periodic benefit cost		$	(47)	$	68

___________________________

(1)Amounts were reclassified from accumulated ~~other comprehensive loss~~OCI into net earnings as a component of “Other pension and post-retirement expenses, net.”

Future cash flows — Our policy is to fund our plans at or above the minimum required by law. As of January 1, ~~2020,~~2021, the date of our last actuarial funding valuation, there was 0no minimum contribution funding requirement for the Qualified Plan. Details regarding ~~2021~~2022 contributions are as follows (in thousands):


		SERP		Post-Retirement Healthcare Plans			SERP		Post-Retirement Healthcare Plans
Net year-to-date contributions	Net year-to-date contributions	$	3,060	$	517	Net year-to-date contributions	$	1,746	$	329
Remaining estimated net contributions during fiscal 2021		$	2,163	$	743
Remaining estimated net contributions during fiscal 2022						Remaining estimated net contributions during fiscal 2022	$	3,470	$	803

We continue to evaluate contributions to our Qualified Plan based on changes in pension assets as a result of asset performance in the current market and the economic environment. We do not anticipate making any contributions to our Qualified Plan in fiscal ~~2021.~~2022.

JACK IN THE BOX INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

9.10.STOCKHOLDERS’ DEFICIT

Summary of changes in stockholders’ deficit — A reconciliation of the beginning and ending amounts of stockholders’ deficit is presented below (in thousands):

Quarter Year-to-date
April 11,
2021 April 12,
2020 April 11,
2021 April 12,
2020
Balance at beginning of period $ (749,123) $ (841,153) $ (793,361) $ (737,584)
Shares issued under stock plans, including tax benefit 4,226 3,375 4,340 3,559
Share-based compensation expense 1,605 2,681 2,836 5,865
Dividends declared (9,041) (9,067) (18,130) (18,492)
Purchases of treasury stock (65,000) 0 (65,000) (153,550)
Net earnings 35,934 11,463 86,793 19,360
Other comprehensive income (loss), net of taxes 842 (44,225) 1,965 6,786
Cumulative-effect from a change in accounting principle 0 0 0 (2,870)
Balance at end of period $ (780,557) $ (876,926) $ (780,557) $ (876,926)


	Number of Shares	Amount		Capital in Excess of Par Value		Retained Earnings		Accumulated Other Comprehensive Loss		Treasury Stock		Total
Balance at October 3, 2021	82,536	$	825	$	500,441	$	1,764,412	$	(74,254)	$	(3,009,306)	$	(817,882)
Shares issued under stock plans, including tax benefit	28	1		48		—		—		—		49
Share-based compensation	—	—		1,018		—		—		—		1,018
Dividends declared	—	—		63		(9,320)		—		—		(9,257)
Net earnings	—	—		—		39,270		—		—		39,270
Other comprehensive income	—	—		—		—		738		—		738
Balance at January 23, 2022	82,564	$	826	$	501,570	$	1,794,362	$	(73,516)	$	(3,009,306)	$	(786,064)


	Number of Shares	Amount		Capital in Excess of Par Value		Retained Earnings		Accumulated Other Comprehensive Loss		Treasury Stock		Total
Balance at September 27, 2020	82,370	$	824	$	489,515	$	1,636,211	$	(110,605)	$	(2,809,306)	$	(793,361)
Shares issued under stock plans, including tax benefit	24	—		114		—		—		—		114
Share-based compensation	—	—		1,231		—		—		—		1,231
Dividends declared	—	—		53		(9,142)		—		—		(9,089)
Net earnings	—	—		—		50,859		—		—		50,859
Other comprehensive income	—	—		—		—		1,123		—		1,123
Balance at January 17, 2021	82,394	$	824	$	490,913	$	1,677,928	$	(109,482)	$	(2,809,306)	$	(749,123)

Repurchases of common stock — ~~The Company repurchased 0.6 million shares of its common stock in the second quarter of fiscal 2021 at an average price of $101.45 per share for an aggregate cost of $65.0 million.~~ There were no repurchases of common stock in the first quarter of fiscal ~~2021.~~2022. As of ~~April 11, 2021, this leaves $135.0~~January 23, 2022, there was $200.0 million remaining under share repurchase programs authorized by the Board of Directors ~~consisting of $35.0 million that~~which expires in November ~~2021 and $100.0 million that expires in November 2022.~~2023.

~~JACK IN THE BOX INC. AND SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)~~

Dividends — During ~~2021,~~2022, the Board of Directors declared ~~two~~a cash ~~dividends~~dividend of ~~$0.40~~$0.44 per common ~~share~~ totaling ~~$18.2~~$9.3 million. Future dividends are subject to approval by our Board of Directors.

~~10.~~11.AVERAGE SHARES OUTSTANDING

The following table reconciles basic weighted-average shares outstanding to diluted weighted-average shares outstanding (in thousands):


		Quarter		Year-to-date			Sixteen Weeks Ended
		April 11, 2021	April 12, 2020	April 11, 2021	April 12, 2020			January 23, 2022	January 17, 2021
Weighted-average shares outstanding – basic	Weighted-average shares outstanding – basic	22,723	22,803	22,863	23,339	Weighted-average shares outstanding – basic		21,205	22,968
Effect of potentially dilutive securities:	Effect of potentially dilutive securities:					Effect of potentially dilutive securities:
Nonvested stock awards and units	Nonvested stock awards and units	50	85	72	144	Nonvested stock awards and units		40	54
Stock options	Stock options	9	0	8	0	Stock options		2	5
Performance share awards	Performance share awards	2	7	2	7	Performance share awards		—	2
Weighted-average shares outstanding – diluted	Weighted-average shares outstanding – diluted	22,784	22,895	22,945	23,490	Weighted-average shares outstanding – diluted		21,247	23,029
Excluded from diluted weighted-average shares outstanding:	Excluded from diluted weighted-average shares outstanding:					Excluded from diluted weighted-average shares outstanding:
Antidilutive	Antidilutive	32	362	39	307	Antidilutive		15	99
Performance conditions not satisfied at the end of the period	Performance conditions not satisfied at the end of the period	36	77	36	77	Performance conditions not satisfied at the end of the period		25	29

JACK IN THE BOX INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

~~11.~~12.COMMITMENTS AND CONTINGENCIES

Legal matters — We assess contingencies, including litigation contingencies, to determine the degree of probability and range of possible loss for potential accrual in our financial statements. An estimated loss contingency is accrued in the financial statements if it is probable that a liability has been incurred and the amount of the loss can be reasonably estimated. Because litigation is inherently unpredictable, assessing contingencies is highly subjective and requires judgments about future events. When evaluating litigation contingencies, we may be unable to provide a meaningful estimate due to a number of factors, including the procedural status of the matter in question, the availability of appellate remedies, insurance coverage related to the claim or claims in question, the presence of complex or novel legal theories, and the ongoing discovery and development of information important to the matter. In addition, damage amounts claimed in litigation against us may be unsupported, exaggerated, or unrelated to possible outcomes, and as such are not meaningful indicators of our potential liability or financial exposure. We regularly review contingencies to determine the adequacy of the accruals and related disclosures. The ultimate amount of loss may differ from these estimates. As of ~~April 11,~~January 23, 2022 and October 3, 2021, ~~and September 27, 2020,~~ the Company had recorded aggregate liabilities of ~~$3.9~~$6.8 million and ~~$3.8~~$7.5 million, respectively, within “Accrued liabilities” on our condensed consolidated balance sheets, for all matters including those described below, that were probable and reasonably estimable. ~~While we~~We believe that ~~additional losses beyond these accruals are reasonably possible, we cannot estimate~~the ultimate determination of liability in connection with legal claims pending against us, if any, in excess of amounts already provided for such matters in the consolidated financial statements, will not have a ~~possible loss contingency~~material adverse effect on our business, our annual results of operations, liquidity or ~~range of reasonably possible loss contingencies beyond these accruals.~~financial position.

Gessele v. Jack in the Box Inc. — In August 2010, 5 former employees instituted litigation in federal court in Oregon alleging claims under the federal Fair Labor Standards Act and Oregon wage and hour laws. The plaintiffs alleged that the Company failed to pay non-exempt employees for certain meal breaks and improperly made payroll deductions for shoe purchases and for workers’ compensation expenses, and later added additional claims relating to timing of final pay and related wage and hour claims involving employees of a franchisee. In 2016, the court dismissed the federal claims and those relating to franchise employees. In June 2017, the court granted class certification with respect to state law claims of improper deductions and late payment of final wages. ~~In November 2019, the court issued a ruling on various dispositive motions, disallowing a portion of plaintiffs’ claimed damages.~~ The parties participated in a voluntary mediation on March 16, 2020, but the matter did not settle. The plaintiffs recently filed a motion for reconsideration of the court’s prior denial of class certification regarding meal and rest break claims, which ~~was denied by~~remains pending before the court. The plaintiffs requested permission to seek appellate review of that decision, but that request was rejected by the Ninth Circuit. The trial of this matter was recently reassigned to a new judge and is scheduled for December 2021. The Company continues to dispute liability and the plaintiffs’ ~~damage~~damages calculations and will continue to vigorously defend against the lawsuit.

~~JACK IN THE BOX INC. AND SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)~~

Other legal matters — In addition to the matter described above, we are subject to normal and routine litigation brought by former or current employees, customers, franchisees, vendors, landlords, shareholders or others. We intend to defend ourselves in any such matters. Some of these matters may be covered, at least in part, by insurance or other third party indemnity obligation. We record receivables from third party insurers when recovery has been determined to be probable. We believe that the ultimate determination of liability in connection with legal claims pending against us, if any, in excess of amounts already provided for such matters in the consolidated financial statements, will not have a material adverse effect on our business, our annual results of operations, liquidity or financial position; however, it is possible that our business, results of operations, liquidity, or financial condition could be materially affected in a particular future reporting period by the unfavorable resolution of one or more matters or contingencies during such period.

Lease guarantees — We remain contingently liable for certain leases relating to our former Qdoba business which we sold in fiscal 2018. Under the Qdoba Purchase Agreement, the buyer has indemnified the Company of all claims related to these guarantees. As of ~~April 11, 2021,~~January 23, 2022, the maximum potential liability of future undiscounted payments under these leases is approximately ~~$26.4~~$26.7 million. The lease terms extend for a maximum of approximately 1516 more years and we would remain a guarantor of the leases in the event the leases are extended for any established renewal periods. In the event of default, we believe the exposure is limited due to contractual protections and recourse available in the lease agreements, as well as the Qdoba Purchase Agreement, including a requirement of the landlord to mitigate damages by re-letting the properties in default, and indemnity from the Buyer. The Company has not recorded a liability for these guarantees as we believe the likelihood of making any future payments is remote.

~~12.~~13.SUPPLEMENTAL CONSOLIDATED CASH FLOW INFORMATION ((in ~~thousands~~)thousands)


		Year-to-date					Sixteen Weeks Ended
		April 11, 2021		April 12, 2020			January 23, 2022		January 17, 2021
Non-cash investing and financing transactions:	Non-cash investing and financing transactions:					Non-cash investing and financing transactions:
Decrease in obligations for treasury stock repurchases		$	0	$	(2,025)
Increase (decrease) in obligations for purchases of property and equipment		$	338	$	(1,247)

Decrease in obligations for purchases of property and equipment						Decrease in obligations for purchases of property and equipment	$	952	$	74
Increase in accrued debt issuance costs						Increase in accrued debt issuance costs	$	3,955	$	—
Increase in dividends accrued or converted to common stock equivalents	Increase in dividends accrued or converted to common stock equivalents	$	108	$	65	Increase in dividends accrued or converted to common stock equivalents	$	63	$	53
Consideration for franchise acquisitions		$	0	$	859
Right-of use assets obtained in exchange for operating lease obligations	Right-of use assets obtained in exchange for operating lease obligations	$	92,723	$	105,748	Right-of use assets obtained in exchange for operating lease obligations	$	69,789	$	40,266
Right-of use assets obtained in exchange for finance lease obligations	Right-of use assets obtained in exchange for finance lease obligations	$	65	$	132	Right-of use assets obtained in exchange for finance lease obligations	$	20	$	65

1312

JACK IN THE BOX INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

~~13.~~14.SUPPLEMENTAL CONSOLIDATED BALANCE SHEET INFORMATION (in thousands)


		April 11, 2021		September 27, 2020			January 23, 2022		October 3, 2021
Accounts and other receivables, net:	Accounts and other receivables, net:					Accounts and other receivables, net:
Trade	Trade	$	87,284	$	77,082	Trade	$	57,250	$	75,273
Notes receivable		1,714		1,193
Notes receivable, current portion						Notes receivable, current portion	1,472		1,467
Income tax receivable	Income tax receivable	1,119		1,591		Income tax receivable	1,043		1,157
Other	Other	2,602		4,092		Other	2,783		2,730
Allowance for doubtful accounts	Allowance for doubtful accounts	(5,998)		(5,541)		Allowance for doubtful accounts	(7,328)		(6,292)
							$	55,220	$	74,335

		$	86,721	$	78,417
Other assets, net:	Other assets, net:					Other assets, net:
Company-owned life insurance policies	Company-owned life insurance policies	$	120,164	$	113,767	Company-owned life insurance policies	$	122,987	$	123,566
Deferred rent receivable	Deferred rent receivable	47,419		48,604		Deferred rent receivable	45,519		46,234
Franchise tenant improvement allowance	Franchise tenant improvement allowance	28,888		29,437		Franchise tenant improvement allowance	33,340		34,124
Notes receivable, less current portion						Notes receivable, less current portion	4,741		4,544
Other	Other	17,667		18,815		Other	21,953		15,970
		$	214,138	$	210,623		$	228,540	$	224,438
Accrued liabilities:	Accrued liabilities:					Accrued liabilities:
Payroll and related taxes	Payroll and related taxes	$	26,427	$	34,475	Payroll and related taxes	$	25,186	$	34,649
Insurance	Insurance	23,383		25,310		Insurance	21,353		21,218
Sales and property taxes						Sales and property taxes	10,225		23,174
Deferred rent income						Deferred rent income	4,023		17,892
Advertising	Advertising	16,144		9,861		Advertising	7,952		13,097
Sales and property taxes		8,760		22,038
Deferred franchise fees	Deferred franchise fees	4,999		4,934		Deferred franchise fees	4,800		4,824
Other	Other	43,837		32,813		Other	30,911		33,563
		$	123,550	$	129,431		$	104,450	$	148,417
Other long-term liabilities:	Other long-term liabilities:					Other long-term liabilities:
Defined benefit pension plans	Defined benefit pension plans	$	115,268	$	120,811	Defined benefit pension plans	$	68,931	$	70,354
Deferred franchise fees	Deferred franchise fees	36,585		38,607		Deferred franchise fees	34,573		35,608
Other	Other	53,492		47,076		Other	46,513		50,380
		$	205,345	$	206,494		$	150,017	$	156,342

~~14.~~15.SUBSEQUENT EVENTS

Securitization Refinancing Transaction —On ~~May 7, 2021,~~February 11, 2022, the Company completed the sale of $550.0 million of its Series 2022-1 3.445% Fixed Rate Senior Secured Notes, Class A-2-I (the “Class A-2-I Notes”) and $550.0 million of its Series 2022-1 4.136% Fixed Rate Senior Secured Notes, Class A-2-II (the “Class A-2-II” and, together with the Class A-2-I Notes, the “2022 Notes”). Interest payments on the 2022 Notes are payable on a quarterly basis. The anticipated repayment dates of the Class A-2-I Notes and the Class A-2-II Notes will be February 2027 and February 2032, respectively, unless earlier prepaid to the extent permitted under the indenture that will govern the 2022 Notes. The 2022 Notes were issued in a privately placed transaction.

The net proceeds of the sale of the 2022 Notes have been used to repay in full of $570.7 million in aggregate outstanding principal amount of the Company’s Series 2019-1 Class A-2-I Notes, together with the applicable make-whole premium and unpaid interest, and is expected to be used to fund a portion of the Company’s acquisition of Del Taco Restaurants, Inc.

The Company also entered into a new purchase agreement under which it will issue up to $150.0 million of its Series 2022-1 Variable Funding Senior Secured Notes, Class A-1 (the “Class A-1 Notes”), which will allow the Company to borrow amounts from time to time on a revolving basis. The Class A-I Notes will replace the Company’s existing $150.0 million Series 2019-1 Variable Funding Senior Secured Notes, Class A-1.

JACK IN THE BOX INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Dividends - On February 18, 2022, the Board of Directors declared a cash dividend of $0.44 per common share, to be paid on ~~June 11, 2021,~~March 22, 2022, to shareholders of record as of the close of business on ~~May 26, 2021.~~March 9, 2022.

Franchise Acquisitions -Subsequent to the end of the first quarter, we took possession of 9 franchise restaurants in a non-cash transaction. We are currently determining the fair value of the non-cash purchase price allocation using the acquisition method of accounting for business combinations.

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

GENERAL

All comparisons between ~~2021~~2022 and ~~2020~~2021 refer to the ~~12-weeks~~16 weeks (“quarter”) ended January 23, 2022 and ~~28-weeks (“year-to-date”) ended April 11,~~January 17, 2021, ~~and April 12, 2020,~~ respectively, unless otherwise indicated.

For an understanding of the significant factors that influenced our performance during ~~2021~~2022 and ~~2020,~~2021, our Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) should be read in conjunction with the condensed consolidated financial statements and related notes included in this Quarterly Report and our Annual Report on Form 10-K for the fiscal year ended ~~September 27, 2020.~~October 3, 2021.

Our MD&A consists of the following sections:

•Overview — a general description of our business and ~~2021~~2022 highlights.

•Results of operations — an analysis of our condensed consolidated statements of earnings for the periods presented in our condensed consolidated financial statements.

•Liquidity and capital resources — an analysis of our cash flows, including capital expenditures, share repurchase activity, dividends, and known known trends that may impact liquidity.

•Discussion of critical accounting estimates — a discussion of accounting policies that require critical judgments and estimates.

•New accounting pronouncements — a discussion of new accounting pronouncements, dates of implementation and the impact on our consolidated financial position or results of operations, if any.

•Cautionary statements regarding forward-looking statements — a discussion of the risks and uncertainties that may cause our actual results to differ materially from any forward-looking statements made by management.

We have included in our MD&A certain performance metrics that management uses to assess company performance and which we believe will be useful in analyzing and understanding our results of operations. These metrics include:

•Changes in sales at restaurants open more than one year (“same-store sales”), ~~system restaurant~~systemwide sales, franchised restaurant sales, and average unit volumes (“AUVs”). Same-store sales, restaurant sales, and AUVs are presented for franchised restaurants and on a system-wide basis, which includes company and franchise restaurants. Franchise sales represent sales at franchise restaurants and are revenues of our franchisees. We do not record franchise sales as revenues; however, our royalty revenues, marketing fees and percentage rent revenues are calculated based on a percentage of franchise sales. We believe franchise and system same-store sales, franchised and system restaurant sales, and AUV information are useful to investors as they have a direct effect on the Company’s profitability.

•Adjusted EBITDA represents net earnings on a generally accepted accounting principles (“GAAP”) basis excluding income taxes, interest expense, net, gains on the sale of company-operated restaurants, ~~impairment and~~ other ~~charges (gains)~~operating expenses (income), net, depreciation and amortization, and amortization of tenant improvement allowances and ~~other, and pension settlement charges.~~incentives. We are presenting Adjusted EBITDA because we believe that it provides a meaningful supplement to net earnings of the Company's core business operating results, as well as a comparison to those of other similar companies. Management believes that Adjusted EBITDA, when viewed with the Company's results of operations in accordance with GAAP and the accompanying reconciliations within MD&A, provides useful information about operating performance and period-over-period change, and provides additional information that is useful for evaluating the operating performance of the Company's core business without regard to potential distortions. Additionally, management believes that Adjusted EBITDA permits investors to gain an understanding of the factors and trends affecting our ongoing cash earnings, from which capital investments are made and debt is serviced.

Same-store sales, ~~system restaurant~~systemwide sales, franchised restaurant sales, AUVs, and Adjusted EBITDA are not measurements determined in accordance with GAAP and should not be considered in isolation, or as an alternative to earnings from operations, or other similarly titled measures of other companies.

~~IMPACT OF~~OVERVIEW

Our Business

As of January 23, 2022, we operated and franchised 2,208 Jack in the Box quick-service restaurants, primarily in the western and southern United States, including one in Guam.

We derive revenue from retail sales at Jack in the Box company-operated restaurants and rental revenue, royalties (based upon a percent of sales), franchise fees and contributions for advertising and other services from franchisees. In addition, we recognize gains or losses from the sale of company-operated restaurants to franchisees, and captioned separately within operating costs and expenses, net, in the accompanying consolidated statements of earnings.

Del Taco Merger Agreement

As previously announced, the Company entered into an Agreement and Plan of Merger dated as of December 5, 2021 (the “Merger Agreement”) with Del Taco Restaurants, Inc., a Delaware corporation (“Del Taco”), to acquire Del Taco (the “Merger”). Del Taco is the nation’s second largest Mexican quick service restaurant chain by number of restaurants and has approximately 600 restaurants across 16 states.

Subject to certain specified exceptions, at the effective time of the Merger, each share of Del Taco common stock issued and outstanding will be converted into the right to receive $12.51 in cash in a transaction valued at approximately $575 million, including existing debt. The transaction, which is expected to close in the first calendar quarter of 2022, is subject to certain customary closing conditions, including Del Taco’s shareholder approval and the receipt of required regulatory approvals. Refer to Note 3, Del Taco Merger Agreement, of the notes to the condensed consolidated financial statements for further information about the Merger.

Impact of COVID-19

The COVID-19 pandemic has continued to have varying degrees of disruption on our business. Throughout the pandemic substantially all of our restaurants have remained open, with the majority of our dining rooms closed and locations operating in an off-premise capacity, leveraging our drive-thru, carryout and delivery ~~capability.~~capabilities. We have continued to follow the guidance of expert health authorities to ensure precautionary steps are taken to protect the health and safety of our employees and guests.

~~In fiscal 2020~~Our business has continued to be challenged by availability and cost of labor resulting in a number of our restaurants across regions to reduce operating hours during the ~~last five weeks of the second quarter, upon the rise~~quarter. We have continued to have limited shortages in ~~“shelter-in-place” mandates and “social distancing” requirements across the country, system same-store sales decreased by 17.0%;~~our supply chain; however, ~~starting in the third quarter and carrying into fiscal 2021, we~~inflationary pressures have ~~seen~~continued to have a significant acceleration of system same-store sales. The acceleration of sales during the last four quarters has been largely driven by average check growth which has more than offset a decline in traffic. It remains uncertain whether restaurant traffic will return to levels achieved prior to the outbreak of COVID-19.

~~While we do not know the future~~ impact ~~COVID-19 will have~~ on our ~~business, or when our business will fully return~~business.

We expect these operating margin pressures due to ~~normal operations, we expect~~labor and supply chain challenges to ~~see~~continue for the remainder of fiscal 2022.

Other Developments

As previously announced, a ~~continued impact from COVID-19 on our results in 2021.~~

~~OTHER RECENT DEVELOPMENTS~~

~~On February 16, 2021, a Midwest~~ franchisee that operated 68 restaurants in the Midwest filed for ~~Chapter~~chapter 11 ~~bankruptcy.~~bankruptcy in February 2021. Of ~~these~~the 68 restaurants, we sublease 50 of the locations to the franchisee and own the land and building for the remaining 18 locations. Through the bankruptcy proceedings, the franchisee may reject the franchise agreements and leases for a number of these locations, resulting in potential impairment costs related to future lease obligations. As

In fiscal 2021, the franchisee filed motions to reject 5 locations which the court authorized. In fiscal 2022, the franchisee filed motions to reject an additional 6 locations which the court authorized. No material impairment costs were recorded in the financial statements in either period as a result of these locations being rejected near the ~~date~~expiration of ~~this report, franchise and~~our master lease ~~agreements related to 3 of the locations have been rejected.~~agreements. The franchisee’s remaining restaurants continue to operate ~~and~~with the franchisee ~~has remained~~remaining current with their obligations to us, ~~except~~with the exception of certain amounts owed at the end and subsequent to the first quarter which have been appropriately reserved for ~~certain obligations that were~~in the accompanying condensed consolidated financial statements.

The Company does not ~~yet due~~expect to acquire and operate any restaurants as part of the ~~bankruptcy filing date which were not material~~sale of these restaurants and our current expectation is the remaining restaurants will be transferred to ~~our consolidated financial statements. However,~~one or more other franchise partners.

Financial Highlights for Fiscal Quarter

•Systemwide sales for the ~~Company could see negative impacts to our results~~quarter increased 0.6% as ~~we work through this franchisee’s bankruptcy.~~

~~OVERVIEW~~

~~As of April 11, 2021, we operated and franchised 2,228 Jack in the Box quick-service restaurants, primarily in the western and southern United States, including one in Guam.~~

~~The following summarizes the most significant events occurring in 2021, and certain trends~~ compared to aprior year ~~ago:~~quarter.

•System same-store sales — ~~System same-store sales increased by 20.6% in~~for the quarter ~~and 15.9% year-to-date. Company restaurant same-store sales~~ increased ~~14.5% in the quarter, reflecting average check growth of 19.9% and a 5.4% decrease in transactions. Franchise same-store sales increased 21.3% in the quarter.~~1.2%.

•~~Company restaurant operations~~Total revenues — ~~Company restaurant costs, including food and packaging, payroll and employee benefits, and occupancy and other operating costs, as a percentage of sales decreased in~~for the quarter ~~to 74.1% from 79.4% in the prior year quarter, primarily due to sales leverage as well as a decrease in food and packaging costs as a percentage of company restaurant sales.~~increased 1.8%.

•~~Franchise~~Earnings from operations— ~~Franchise same-store sales increased by 21.3% in~~for the quarter ~~driving higher royalty and rent revenues of $7.6 million and $8.0 million, respectively.~~decreased 17.1%.

•~~Selling, general and administrative (“SG&A”) expenses~~ —Net earnings ~~SG&A~~and diluted EPS decreased by $5.3 million in the quarter, primarily due to favorable mark-to-market adjustments on investments supporting the Company’s non-qualified retirement plans, lower costs related to litigation matters,22.8% and ~~lower insurance costs versus the prior year quarter.~~16.3%, respectively.

•Adjusted EBITDA — ~~Adjusted EBITDA increased in 2021 to $178.1 million from $122.9 million~~decreased in the ~~prior year.~~quarter from $102.4 million to $91.2 million, or 10.9%.

•Net units down 1.3% with 12 closures and 2 store openings during the quarter.

RESULTS OF OPERATIONS

The following table presents certain income and expense items included in our condensed consolidated statements of earnings as a percentage of total revenues, unless otherwise indicated. Percentages may not add due to rounding.

CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS DATA


		Quarter				Year-to-date					Sixteen Weeks Ended
		April 11, 2021		April 12, 2020		April 11, 2021		April 12, 2020			January 23, 2022		January 17, 2021
Revenues:	Revenues:									Revenues:
Company restaurant sales	Company restaurant sales	33.4	%	34.4	%	33.6	%	34.3	%	Company restaurant sales	34.8	%	33.8	%
Franchise rental revenues	Franchise rental revenues	30.3	%	32.3	%	30.5	%	31.7	%	Franchise rental revenues	29.9	%	30.6	%
Franchise royalties and other	Franchise royalties and other	18.4	%	17.5	%	17.9	%	17.2	%	Franchise royalties and other	17.6	%	17.6	%
Franchise contributions for advertising and other services	Franchise contributions for advertising and other services	17.9	%	15.8	%	18.0	%	16.8	%	Franchise contributions for advertising and other services	17.6	%	18.0	%
		100.0	%	100.0	%	100.0	%	100.0	%		100.0	%	100.0	%
Operating costs and expenses, net:	Operating costs and expenses, net:									Operating costs and expenses, net:
Food and packaging (1)	Food and packaging (1)	27.8	%	29.9	%	28.1	%	29.8	%	Food and packaging (1)	31.3	%	28.3	%
Payroll and employee benefits (1)	Payroll and employee benefits (1)	30.8	%	32.6	%	30.6	%	31.2	%	Payroll and employee benefits (1)	33.1	%	30.6	%
Occupancy and other (1)	Occupancy and other (1)	15.5	%	16.9	%	15.6	%	15.9	%	Occupancy and other (1)	17.4	%	15.6	%
Franchise occupancy expenses (2)	Franchise occupancy expenses (2)	62.8	%	69.2	%	62.8	%	68.0	%	Franchise occupancy expenses (2)	62.1	%	62.8	%
Franchise support and other costs (3)	Franchise support and other costs (3)	7.1	%	7.9	%	6.2	%	8.5	%	Franchise support and other costs (3)	6.4	%	5.5	%
Franchise advertising and other services expenses (4)	Franchise advertising and other services expenses (4)	102.1	%	104.7	%	102.6	%	103.5	%	Franchise advertising and other services expenses (4)	104.1	%	103.0	%
Selling, general and administrative expenses	Selling, general and administrative expenses	7.3	%	11.2	%	6.6	%	10.0	%	Selling, general and administrative expenses	7.4	%	6.1	%
Depreciation and amortization	Depreciation and amortization	4.2	%	5.7	%	4.2	%	5.5	%	Depreciation and amortization	3.6	%	4.3	%
Impairment and other charges (gains), net		0.5	%	0.3	%	0.1	%	(1.6)	%
Other operating expenses (income), net										Other operating expenses (income), net	1.1	%	(0.1)	%
Gains on the sale of company-operated restaurants	Gains on the sale of company-operated restaurants	(0.6)	%	—	%	(0.5)	%	(0.3)	%	Gains on the sale of company-operated restaurants	—	%	(0.4)	%
Earnings from operations	Earnings from operations	25.2	%	15.2	%	25.8	%	19.6	%	Earnings from operations	21.4	%	26.3	%
Income tax rate (5)	Income tax rate (5)	27.3	%	32.3	%	26.1	%	30.7	%	Income tax rate (5)	26.5	%	25.1	%

____________________________

(1)As a percentage of company restaurant sales.

(2)As a percentage of franchise rental revenues.

(3)As a percentage of franchise royalties and other.

(4)As a percentage of franchise contributions for advertising and other services.

(5)As a percentage of earnings from operations and before income taxes.

The following table summarizes changes in same-store sales for ~~company-owned,~~company-operated, franchised, and ~~system-wide~~system restaurants:


		Quarter				Year-to-date					Sixteen Weeks Ended
		April 11, 2021		April 12, 2020		April 11, 2021		April 12, 2020				January 23, 2022		January 17, 2021
Company	Company	14.5	%	(4.1)	%	10.4	%	(0.1)	%	Company		(0.3)	%	7.5	%
Franchise	Franchise	21.3	%	(4.2)	%	16.5	%	(0.9)	%	Franchise		1.4	%	13.0	%
System	System	20.6	%	(4.2)	%	15.9	%	(0.8)	%	System		1.2	%	12.5	%

The following table summarizes changes in the number and mix of company and franchise restaurants:


		2021						2020							2022						2021
		Company		Franchise		Total		Company		Franchise		Total			Company		Franchise		Total		Company		Franchise		Total
Beginning of year	Beginning of year	144		2,097		2,241		137		2,106		2,243		Beginning of year	163		2,055		2,218		144		2,097		2,241
New	New	—		6		6		—		16		16		New	—		2		2		—		3		3
Acquired from franchisees	Acquired from franchisees	4		(4)		—		8		(8)		—		Acquired from franchisees	4		(4)		—		4		(4)		—
Closed	Closed	—		(19)		(19)		(1)		(12)		(13)		Closed	(2)		(10)		(12)		—		(7)		(7)
End of period	End of period	148		2,080		2,228		144		2,102		2,246		End of period	165		2,043		2,208		148		2,089		2,237
% of system	% of system	7	%	93	%	100	%	6	%	94	%	100	%	% of system	7	%	93	%	100	%	7	%	93	%	100	%

The following table summarizes restaurant sales for ~~company-owned,~~company-operated, franchised, and ~~total system~~systemwide sales (in thousands):

Quarter Year-to-date
April 11,
2021 April 12,
2020 April 11,
2021 April 12,
2020
Company-owned restaurant sales $ 85,962 $ 74,380 $ 200,240 $ 179,744
Franchised restaurant sales (1) 847,363 695,926 1,963,189 1,675,271
System sales (1) $ 933,325 $ 770,306 $ 2,163,429 $ 1,855,015


	Sixteen Weeks Ended
	January 23, 2022		January 17, 2021
Company-operated restaurant sales	$	120,056	$	114,278
Franchised restaurant sales (1)	1,117,676		1,115,826
Systemwide sales (1)	$	1,237,732	$	1,230,104

____________________________

(1)Franchised restaurant sales represent sales at franchised restaurants and are revenues of our franchisees. System sales include company and franchised restaurant sales. We do not record franchised sales as revenues; however, our royalty revenues, marketing fees and percentage rent revenues are calculated based on a percentage of franchised sales. We believe franchised and system restaurant sales information is useful to investors as they have a direct effect on the Company's profitability.

Below is a reconciliation of Non-GAAP Adjusted EBITDA to the most directly comparable GAAP measure, net earnings (in thousands):


		Quarter				Year-to-date					Sixteen Weeks Ended
		April 11, 2021		April 12, 2020		April 11, 2021		April 12, 2020				January 23, 2022		January 17, 2021
Net earnings - GAAP	Net earnings - GAAP	$	35,934	$	11,463	$	86,793	$	19,360	Net earnings - GAAP		$	39,270	$	50,859

Income tax expense	Income tax expense	13,524		5,458		30,585		8,591		Income tax expense		14,190		17,061
Interest expense, net	Interest expense, net	15,227		15,409		35,962		35,351		Interest expense, net		20,187		20,735
Pension settlement charges		—		321		—		38,927
Gains on the sale of company-operated restaurants	Gains on the sale of company-operated restaurants	(1,532)		—		(2,815)		(1,575)		Gains on the sale of company-operated restaurants		(48)		(1,283)
Impairment and other charges (gains), net		1,228		716		776		(8,575)
Other operating expenses (income), net										Other operating expenses (income), net		3,843		(452)
Depreciation and amortization	Depreciation and amortization	10,696		12,282		25,267		29,010		Depreciation and amortization		12,496		14,571
Amortization of franchise tenant improvement allowances and other		673		614		1,534		1,765
Amortization of franchise tenant improvement allowances and incentives										Amortization of franchise tenant improvement allowances and incentives		1,234		861
Adjusted EBITDA - Non-GAAP	Adjusted EBITDA - Non-GAAP	$	75,750	$	46,263	$	178,102	$	122,854	Adjusted EBITDA - Non-GAAP		$	91,172	$	102,352

Company Restaurant Operations

The following table presents company restaurant sales and costs as a percentage of the related ~~sales. Percentages may not add due to rounding~~sales (dollars in thousands):


		Quarter								Year-to-date									Sixteen Weeks Ended
		April 11, 2021				April 12, 2020				April 11, 2021				April 12, 2020						January 23, 2022	January 17, 2021
Company restaurant sales	Company restaurant sales	$	85,962			$	74,380			$	200,240			$	179,744			Company restaurant sales			$	120,056			$	114,278
Company restaurant costs:	Company restaurant costs:																	Company restaurant costs:
Food and packaging	Food and packaging	$	23,938	27.8	%	$	22,237	29.9	%	$	56,315	28.1	%	$	53,585	29.8	%	Food and packaging			$	37,537	31.3	%	$	32,377	28.3	%
Payroll and employee benefits	Payroll and employee benefits	$	26,440	30.8	%	$	24,261	32.6	%	$	61,371	30.6	%	$	56,151	31.2	%	Payroll and employee benefits			$	39,725	33.1	%	$	34,931	30.6	%
Occupancy and other	Occupancy and other	$	13,349	15.5	%	$	12,570	16.9	%	$	31,184	15.6	%	$	28,528	15.9	%	Occupancy and other			$	20,877	17.4	%	$	17,835	15.6	%

Company restaurant sales increased ~~$11.6~~$5.8 million or ~~15.6%~~5.1% compared to the prior year, primarily due to an increase in the ~~quarter and $20.5 million, or 11.4% year-to-date versus a year ago primarily due to~~number of company-operated restaurants, average check growth, menu price increases, and ~~an increase in the number of company-operated restaurants;~~ partially offset by a ~~decrease~~decline in traffic. The following table presents the approximate impact of these items on company restaurant sales ~~in 2021~~ (in millions):

Quarter Year-to-date
AUV increase $ 10.4 $ 17.1
Increase in the average number of restaurants 1.2 3.4
Total change in company restaurant sales $ 11.6 $ 20.5


	Sixteen Weeks Ended
		January 23, 2022
Increase in the average number of restaurants		$	3.7
AUV increase		2.1
Total change in company restaurant sales		$	5.8

Same-store sales at company-operated restaurants ~~increased 14.5% in the quarter and 10.4% year-to-date~~decreased 0.3% compared to a year ago. The following table summarizes the change ~~in company-operated same store-sales~~ versus a year ago:

Quarter Year-to-date
April 11,
2021 April 12,
2020 April 11,
2021 April 12,
2020
Average check (1) 19.9 % 6.4 % 20.8 % 4.2 %
Transactions (5.4) % (10.5) % (10.4) % (4.3) %
Change in same-store sales 14.5 % (4.1) % 10.4 % (0.1) %


	Sixteen Weeks Ended
		January 23, 2022
Average check (1)		3.5	%
Transactions		(3.8)	%
Change in same-store sales		(0.3)	%

____________________________

(1)~~Amounts in 2021 include~~Includes price increases of approximately ~~3.1% in the quarter and 3.3% year-to-date. Amounts in 2020 include price increase of approximately 2.4% in the quarter and 2.6% year-to-date.~~5.5%.

Food and packaging costs as a percentage of company restaurant sales ~~decreased~~increased to ~~27.8%~~31.3% from 28.3% a year ago, primarily due a 2.6% increase in ~~the quarter~~commodities and ~~28.1% year-to-date in 2021 compared to 29.9% in the quarter and 29.8% year-to-date in 2020, driven~~an unfavorable sales mix of 2.0%, partially offset by ~~favorable changes in product mix and~~ menu price increases ~~partially offset by higher costs for ingredients.~~of 1.6%. Commodity costs increased in the ~~quarter and year-to-date~~current fiscal year by approximately ~~1.7% and 1.6%, respectively,~~10.5% primarily due to increases in beef, pork, sauces and ~~oil, partially offset by a decrease in beef. For fiscal 2021, we currently expect commodity costs to increase by approximately 3% compared with fiscal 2020.~~oil.

Payroll and employee benefit costs as a percentage of company restaurant sales ~~decreased~~increased to ~~30.8%~~33.1% in 2022 compared with 30.6% a year ago primarily due to labor inflation, a change in the ~~quarter and 30.6% year-to-date in 2021 compared~~mix of restaurants due to ~~32.6%~~franchisee acquisitions, partially offset by lower incentive compensation. Labor inflation was approximately 10.9% in the quarter and 31.2% year-to-date in 2020, driven by sales leverage, which more than offset higher average wages resulting from wage inflation and a highly competitive labor market, and higher incentive compensation costs.current fiscal year.

Occupancy and other costs, as a percentage of company restaurant sales, ~~decreased~~increased to ~~15.5%~~17.4% in 2022 compared with 15.6% a year ago due primarily to the ~~quarter and 15.6% year-to-date in 2021 compared to 16.9% in the quarter and 15.9% year-to-date in 2020 primarily due to leverage from~~acquisition of 20 restaurants with lower than average sales volumes as well as higher ~~same-store sales and lower~~ costs for maintenance and ~~repairs, partially offset by higher costs for delivery fees as we continue to grow our delivery sales mix.~~

repair and utilities.

Franchise Operations

The following table presents franchise revenues and costs in each period and other information we believe is useful in analyzing the change in franchise operating results (dollars in thousands):


		Quarter				Year-to-date					Sixteen Weeks Ended
		April 11, 2021		April 12, 2020		April 11, 2021		April 12, 2020				January 23, 2022		January 17, 2021
Franchise rental revenues	Franchise rental revenues	$	77,901	$	69,885	$	181,650	$	165,969	Franchise rental revenues		$	103,099	$	103,749

Royalties	Royalties	43,620		36,049		100,963		86,292		Royalties		57,648		57,343
Franchise fees and other	Franchise fees and other	3,611		1,715		5,916		3,938		Franchise fees and other		3,107		2,305
Franchise royalties and other	Franchise royalties and other	47,231		37,764		106,879		90,230		Franchise royalties and other		60,755		59,648
Franchise contributions for advertising and other services	Franchise contributions for advertising and other services	46,123		34,128		106,989		87,887		Franchise contributions for advertising and other services		60,801		60,866
Total franchise revenues	Total franchise revenues	$	171,255	$	141,777	$	395,518	$	344,086	Total franchise revenues		$	224,655	$	224,263

Franchise occupancy expenses	Franchise occupancy expenses	$	48,904	$	48,341	$	114,073	$	112,858	Franchise occupancy expenses		$	63,983	$	65,169
Franchise support and other costs	Franchise support and other costs	3,341		2,971		6,614		7,647		Franchise support and other costs		3,911		3,273
Franchise advertising and other services expenses	Franchise advertising and other services expenses	47,104		35,734		109,799		90,958		Franchise advertising and other services expenses		63,308		62,695
Total franchise costs	Total franchise costs	$	99,349	$	87,046	$	230,486	$	211,462	Total franchise costs		$	131,202	$	131,137
Franchise costs as a percentage of total franchise revenues	Franchise costs as a percentage of total franchise revenues	58.0%		61.4%		58.3%		61.5%		Franchise costs as a percentage of total franchise revenues		58.4%		58.5%

Average number of franchise restaurants	Average number of franchise restaurants	2,071		2,085		2,075		2,086		Average number of franchise restaurants		2,039		2,078
% decrease										% decrease		(1.9)%
Franchised restaurant sales	Franchised restaurant sales	$	847,363	$	695,926	$	1,963,189	$	1,675,271	Franchised restaurant sales		$	1,117,676	$	1,115,826
Franchised restaurant AUVs	Franchised restaurant AUVs	$	409	$	334	$	946	$	803	Franchised restaurant AUVs		$	548	$	537
Royalties as a percentage of total franchised restaurant sales	Royalties as a percentage of total franchised restaurant sales	5.1%		5.2%		5.1%		5.2%		Royalties as a percentage of total franchised restaurant sales		5.2%		5.1%

Franchise rental revenues ~~increased $8.0~~decreased $0.6 million, or ~~11.5%~~0.6% in ~~the quarter, and $15.7 million or 9.4% year-to-date~~2022 compared to the prior year, primarily due to lower minimum rent and property tax reimbursements of $1.6 million due to a reduction in the number of franchise subleases compared to prior year, partially offset by higher percentage rent of $1.1 million driven by higher franchise restaurant sales.

Franchise royalties and other increased ~~$9.5~~$1.1 million, or ~~25.1%~~1.9% in 2022 compared to the prior year, primarily due to an increase of $0.8 million in fees received in connection with the early termination of franchise agreements, as well as higher royalties of $0.3 million driven by higher franchise restaurant sales.

Franchise contributions for advertising and other services revenues decreased $0.1 million, or 0.1% in 2022 compared to the prior year, due to a decrease of $0.1 million in technology and sourcing fees driven by a lower average number of franchise restaurants compared to the prior year.

Franchise occupancy expenses, primarily rent, decreased $1.2 million, or 1.8% in 2022 compared to the prior year, primarily due to a reduction in the ~~quarter,~~average number of franchise restaurants in 2022.

Franchise support and ~~$16.6~~other costs increased $0.6 million ~~or 18.5% year-to-date~~in 2022 compared to the prior year, primarily due to an increase in ~~franchise restaurant sales driving royalties higher.~~

Franchise contributions for advertising and other services revenues increased $12.0 million, or 35.1% in the quarter and $19.1 million, or 21.7% year-to-date compared to the prior year, mainly due to an increase in marketing contributions due to higher franchise restaurant sales and as a result of reducing our marketing fees at the onset of the pandemic to provide additional financial support to our franchise operators.

Franchise occupancy expenses, primarily rent, increased $0.6 million in the quarter and $1.2 million year-to-date compared to the prior year, mainly due to annual base rent increases and higher costs for percentage rent expense.

~~Franchise support and other costs increased $0.4 million in the quarter, primarily due to higher incentive compensation, and decreased $1.0 million year-to-date, driven by a decrease in~~ franchisee bad debt expense from specific franchise situations ~~that occurred~~occurring in the ~~prior~~ year.

Franchise advertising and other service expenses increased ~~$11.4~~$0.6 million, or 1.0% in ~~the quarter and $18.8 million year-to-date~~2022 compared to the prior year primarily due to ~~an increase~~higher technology costs in ~~marketing contributions from our franchisees.~~the current year.

Depreciation and Amortization

Depreciation and amortization decreased by ~~$1.6~~$2.1 million in ~~the quarter and $3.7 million year-to-date~~2022 compared towith the prior year, primarily due to certain franchise building assets becoming fully ~~depreciated.~~depreciated in the current fiscal year.

Selling, General and Administrative (“SG&A”) Expenses

The following table presents the change in SG&A expenses compared with the prior year (in thousands):

Increase/(Decrease)
Quarter Year-to-date
Advertising $ 792 $ 1,243
Incentive compensation (including share-based compensation and related payroll taxes) 2,282 2,573
Cash surrender value of COLI policies, net (5,914) (8,578)
Litigation matters (1,891) (5,822)
Insurance (2,064) (2,356)
Other 1,453 (151)
$ (5,342) $ (13,091)


	Sixteen Weeks Ended
	January 23, 2022
Advertising	$	294
Incentive compensation (including share-based compensation and related payroll taxes)	(2,807)
Cash surrender value of COLI policies, net	5,239
Other	2,114
	$	4,840

Advertising costs represent company contributions to our marketing fund and are generally determined as a percentage of company-operated restaurant sales. Advertising costs increased ~~$0.8~~$0.3 million ~~in the quarter and $1.2 million year-to-date~~ compared to the prior year primarily due to ~~higher~~an increase in the number of company-operated ~~restaurant sales, and~~restaurants.

Incentive compensation decreased by $2.8 million in 2022 compared to the prior year due to a $2.6 million decrease in the ~~contribution percentage in the prior year.~~

~~Incentive compensation increased by $2.3 million in the quarter and $2.6 million year-to-date versus a year ago primarily~~annual incentives mainly as a result of ~~higher~~lower achievement levels compared to the prior year, ~~partially offset by~~as well as a $0.2 million decrease in stock-based compensation ~~as a result~~mainly from timing of ~~turnover at~~annual grants compared to the ~~executive level.~~prior year.

The cash surrender value of our company-owned life insurance (“COLI”) policies, net of changes in our non-qualified deferred compensation obligation supported by these policies, are subject to market fluctuations. The changes in market values had a ~~positive~~negative impact of ~~$5.9~~$5.2 million versus the prior year as a result of $0.4 million losses recognized in ~~the quarter and $8.6 million year-to-date~~2022 compared to $4.8 million gains in the prior year.

~~Litigation matters decreased by $1.9 million in the quarter and $5.8 million year-to-date primarily due to costs incurred in the prior year related to various employment litigation matters.~~

~~Insurance costs decreased by $2.1 million in the quarter and $2.4 million year-to-date, primarily due to favorable claim development factors related to our workers’ compensation liabilities.~~

~~Impairment and~~ Other ~~Charges (Gains)~~Operating Expenses (Income), Net

~~Impairment and other charges (gains)~~Other operating expenses (income), net is comprised of the following (in thousands):


		Quarter				Year-to-date					Sixteen Weeks Ended
		April 11, 2021		April 12, 2020		April 11, 2021		April 12, 2020				January 23, 2022		January 17, 2021
Acquisition, integration, and restructuring costs										Acquisition, integration, and restructuring costs		$	3,013	$	6
Costs of closed restaurants and other	Costs of closed restaurants and other	$	441	$	331	$	1,464	$	432	Costs of closed restaurants and other		1,072		1,023
Restructuring costs		(2)		118		4		1,163
Losses (gains) on disposition of property and equipment, net		229		267		(1,931)		(10,170)
Accelerated depreciation	Accelerated depreciation	560		—		1,239		—		Accelerated depreciation		375		679
Gains on disposition of property and equipment, net										Gains on disposition of property and equipment, net		(617)		(2,160)
		$	1,228	$	716	$	776	$	(8,575)			$	3,843	$	(452)

~~Impairment and other charges (gains)~~Other operating expenses (income), net increased by ~~$0.5~~$4.3 million, ~~in the quarter and $9.4 million year-to-date. Year-to-date, the increase is~~ primarily due to ~~a $10.8~~$3.0 million ~~gain related~~of costs incurred during the quarter relating to the ~~sale of one of our corporate office buildings in 2020, partially offset by a $2.2~~Del Taco acquisition and $1.5 million ~~gain~~lower gains on the sale of ~~two real estate properties in the first quarter of 2021.~~property and equipment compared to prior year.

Gains on the Sale of Company-Operated Restaurants

In ~~2021~~2022 and ~~2020,~~2021, no company-operated restaurants were sold to franchisees. Amounts included in “Gains on the sale of company-operated restaurants” in ~~all~~both periods related to resolutions of certain contingencies from the sale of restaurants in prior years.

~~Other Pension and Post-Retirement Expenses, Net~~

Other pension and post-retirement expenses, net decreased by $0.3 million in the quarter and $39.0 million year-to-date versus the prior year, primarily due to non-cash settlement charges in 2020. Refer to Note 8, ~~Retirement Plans, of the notes to the condensed consolidated financial statements for additional information.~~

Interest Expense, Net

Interest expense, net is comprised of the following (in thousands):


		Quarter				Year-to-date					Sixteen Weeks Ended
		April 11, 2021		April 12, 2020		April 11, 2021		April 12, 2020				January 23, 2022		January 17, 2021
Interest expense	Interest expense	$	15,241	$	15,458	$	35,980	$	35,877	Interest expense		$	20,273	$	20,739
Interest income	Interest income	(14)		(49)		(18)		(526)		Interest income		(86)		(4)
Interest expense, net	Interest expense, net	$	15,227	$	15,409	$	35,962	$	35,351	Interest expense, net		$	20,187	$	20,735

Interest expense, net decreased by ~~$0.2~~$0.5 million in 2022 compared to the ~~quarter and increased $0.6 million year-to-date compared with a~~prior year ~~ago. In the quarter, the decrease is~~primarily due to lower average ~~debt balances compared to~~borrowings as a result of paying down borrowings under our Variable Funding Notes during the ~~prior year. Year-to-date, the increase is primarily due to a decrease in interest income versus the prior year.~~second quarter of 2021.

Income Tax Expense

The income tax provisions reflect tax rates ~~of 27.3%~~of 26.5% in ~~the second quarter~~2022 and ~~26.1% year-to-date, compared with 32.3% and 30.7%, respectively,~~25.1% in ~~fiscal year 2020.~~2021. The major ~~components~~component of the year-over-year ~~decrease~~increase in tax rates ~~were a decrease~~was the non-deductibles losses in the ~~impact of non-deductible compensation for certain officers, an increase~~current year versus non-taxable gains in ~~non-taxable gains~~the prior year from the market performance of insurance products used to fund certain non-qualified retirement plans, and a decrease in non-deductible costs resulting from a California Private Attorney General Act lawsuit settled in the prior year, partially offset by an adjustment related to state taxes recorded in the second quarter of fiscal year 2021.plans.

LIQUIDITY AND CAPITAL RESOURCES

General

Our primary sources of liquidity and capital resources are cash flows from operations and borrowings available under our securitized financing facility. Our cash requirements consist principally of working capital, general corporate needs, capital expenditures, income tax payments, debt service requirements, franchise tenant improvement allowance and incentive distributions, dividend payments, and obligations related to our benefit plans. We generally reinvest available cash flows from operations to invest in our business, service our debt obligations, pay dividends and repurchase shares of our common stock.

Our primary sources of short-term and long-term liquidity are expected to be cash flows from operations and available borrowings under our ~~Variable Funding Notes.~~securitized financing facility. As of ~~April 11, 2021,~~January 23, 2022, the Company had ~~$108.8~~$88.5 million of cash and restricted cash on its consolidated balance ~~sheet~~sheet.

On December 5, 2021, the Company entered into an Agreement and ~~$110.5~~Plan of Merger (the “Merger Agreement”) with Del Taco Restaurants, Inc., for total consideration valued at $575.0 million, including existing debt. To partially fund the acquisition of ~~borrowing availability~~Del Taco, we completed a debt refinancing transaction on February 11, 2022, as further described below.

The Merger Agreement provides for certain termination rights for both Jack in the Box and Del Taco and provides that, in connection with a termination of the Merger Agreement under ~~its Variable Funding Notes.~~certain specified circumstances as described in the Merger Agreement, Del Taco will be required to pay Jack in the Box a termination fee of $14.2 million or Jack in the Box will be required to pay Del Taco a termination fee of $28.4 million.

Based upon current levels of operations and anticipated growth, we expect that cash flows from operations, combined with our securitized financing facility, ~~including our Variable Funding Notes,~~ will be sufficient to meet our capital expenditure, working capital and debt service requirements for at least the next twelve months and the foreseeable future.

Cash Flows

The table below summarizes our cash flows from continuing operations (in thousands):


		Year-to-date					Sixteen Weeks Ended
		April 11, 2021		April 12, 2020			January 23, 2022		January 17, 2021
Total cash provided by (used in):	Total cash provided by (used in):					Total cash provided by (used in):
Operating activities	Operating activities	$	78,544	$	58,927	Operating activities	$	34,051	$	62,251
Investing activities	Investing activities	(15,718)		29,601		Investing activities	(6,837)		(637)
Financing activities	Financing activities	(190,972)		(70,905)		Financing activities	(12,316)		(9,959)
Net cash flows	Net cash flows	$	(128,146)	$	17,623	Net cash flows	$	14,898	$	51,655

Operating Activities. Operating cash flows ~~increased $19.6~~decreased $28.2 million compared with a year ago, which was primarily due to ~~higher net income adjusted for non-cash items of $9.6 million and favorable changes~~an unfavorable change in working capital of ~~$10.0~~$25.3 million, ~~mainly~~ as a result of ~~higher~~lower collections on ~~receivables due to postponing collections of~~ marketing and rent ~~payments from~~payment deferrals provided to our franchisees in ~~the prior year, and decreases in interest~~2020, higher property tax payments ~~and franchise tenant improvements allowance disbursements, partially offset by a decrease in payables~~ due to timing differences, and ~~extending payment terms in the prior year.~~higher bonus payments.

Pension and Post-Retirement Contributions — Our policy is to fund our pension plans at or above the minimum required by law. As of January 1, ~~2020,~~2021, the date of our last actuarial funding valuation, there was no minimum contribution funding requirement for our qualified pension plan. In ~~2021,~~2022, we contributed ~~$3.6~~$2.1 million to our non-qualified pension plan and post-retirement plans.

Investing Activities. Cash ~~provided by~~used in investing activities ~~decreased~~increased by ~~$45.3~~$6.2 million compared with a year ago, primarily due to $17.4 million of proceeds received in the prior year as a result of a sale and partial leaseback of a multi-tenant property, $18.8 million lower proceeds received on the sale of property and equipment, primarily due to proceeds received on the sale of a corporate office building in the prior year, and $10.2$2.3 million higher capital ~~expenditures.~~expenditures and $3.0 million lower death benefit proceeds of company-owned life insurance policies.

Capital Expenditures — The composition of capital expenditures in each period follows (in thousands):

Year-to-date
April 11,
2021 April 12,
2020
Restaurants:
Restaurant facility expenditures $ 8,442 $ 6,026
Purchases of assets intended for sale or sale and leaseback 10,343 417
Other, including information technology 1,639 1,967
20,424 8,410
Corporate Services:
Information technology 658 2,926
Other, including facility improvements 1,846 1,441
2,504 4,367
Total capital expenditures $ 22,928 $ 12,777

In 2021, capital expenditures increased by $10.2 million compared to a year ago primarily due to a $9.9 million increase in purchases of assets intended for sale and leaseback. During 2021, we exercised our right of first refusal related to four leased restaurant properties which we intend to sell and leaseback within the next 12 months.


	Sixteen Weeks Ended
	January 23, 2022		January 17, 2021
Restaurants:
Remodel / refresh programs	$	921	$	3,903
Restaurant facility expenditures	4,374		1,451
Purchases of assets intended for sale and leaseback	1,877		150
Restaurant information technology	968		288
	8,140		5,792
Corporate Services:
Information technology	52		466
Corporate facilities	1,209		818
	1,261		1,284

Total capital expenditures	$	9,401	$	7,076

Financing Activities. Cash flows used in financing activities increased by ~~$120.1~~$2.4 million compared with a year ago, primarily due to ~~our repayment~~$2.1 million of deferred financing costs paid during the ~~second quarter of $107.9 million of 2020 borrowings on our Variable Funding Notes, partially offset by a $90.6 million decrease in cash used for share repurchases.~~quarter.

Repurchases of Common Stock — The Company ~~repurchased 0.6 million~~did not repurchase any shares ~~of its common stock~~ in the ~~second~~first quarter of ~~fiscal~~2022. On November 19, 2021, ~~for an aggregate cost of $65.0 million. As of April 11, 2021, $135.0 million remained available under share repurchase programs authorized by~~ the Board of Directors ~~consisting of $35.0~~authorized a $200.0 million stock buy-back program that expires inon November ~~2021 and $100.0 million that expires in November 2022.~~20, 2023.

Dividends — During ~~2021,~~ the ~~Board~~first quarter of ~~Directors declared two quarterly cash dividends of $0.40 per common share totaling $18.2 million. On May 7, 2021,~~2022, the Board of Directors declared a cash dividend of $0.44 per common share ~~representing a 10 percent increase from the prior dividend rate.~~totaling $9.3 million.

~~Long-Term Debt~~Securitized Refinancing Transaction — ~~— As of April~~On February 11, 2021, we had $1.3 billion of outstanding borrowings under our securitized financing facility, comprised of total principal outstanding on the Class A-2 Notes (as defined below). During the second quarter of 2021, the Company fully paid down its outstanding borrowings on its Variable Funding Notes. As of April 11, 2021, borrowing availability under the Variable Funding Notes was $110.5 million.

~~On July 8, 2019, Jack in the Box Funding, LLC (the “Master Issuer”), a limited-purpose, bankruptcy-remote, wholly owned indirect subsidiary of~~2022, the Company completed ~~its securitization transaction and issued $575.0~~the sale of $550.0 million of its Series ~~2019-1 3.982%~~2022-1 3.445% Fixed Rate Senior Secured Notes, Class A-2-I (the “Class A-2-I ~~Notes”), $275.0~~Notes) and $550.0 million of its Series ~~2019-1 4.476%~~2022-1 4.136% Fixed Rate Senior Secured Notes, Class A-2-II (the “Class ~~A-2-II Notes”) and $450.0 million of its Series 2019-1 4.970% Fixed Rate Senior Secured Notes, Class A-2-III (the “Class A-2-III Notes”)~~A-2-II” and, together with the Class A-2-I Notes, the “2022 Notes”). Interest payments on the 2022 Notes are payable on a quarterly basis. The anticipated repayment dates of the Class A-2-I Notes and the Class A-2-II Notes (the “Class A-2 Notes”), in an offering exempt from registration under the Securities Act of 1933, as amended. In connection with the issuance of the Class A-2 Notes, the Master Issuer also entered into a revolving financing facility of Series 2019-1 Variable Funding Senior Secured Notes, Class A-1 (the “Variable Funding Notes”), which allows for the drawing of up to $150.0 million under the Variable Funding Noteswill be February 2027 and ~~the issuance of letters of credit. The Class A-2 Notes and the Variable Funding Notes are referred to collectively as the “Notes.”~~

Interest and principal payments on the Class A-2 Notes are payable on a quarterly basis. The quarterly principal payment of $3.25 million on the Class A-2 Notes may be suspended when the specified leverage ratio, which is a measure of outstanding debt to earnings before interest, taxes, depreciation, and amortization, adjusted for certain items (as defined in the Indenture), is less than or equal to 5.0x. Exceeding the leverage ratio of 5.0x does not violate any covenant related to the Class A-2 Notes. As of September 27, 2020 and April 11, 2021, the Company’s actual leverage ratio was under 5.0x, and as a result, quarterly principal payments were not required.

~~The legal final maturity date of the Class A-2 Notes is in August 2049, but it is expected that,~~February 2032, respectively, unless earlier prepaid to the extent permitted under the ~~Indenture,~~indenture that will govern the ~~anticipated repayment dates~~2022 Notes. The 2022 Notes were issued in a privately placed transaction.

The net proceeds of the sale of the 2022 Notes have been used to repay in full of $570.7 million in aggregate outstanding principal amount of the Company’s Series 2019-1 Class A-2-I Notes, the Class A-2-II Notes and the Class A-2-III Notes will be August 2023, August 2026 and August 2029, respectively (the “Anticipated Repayment Dates”). If the Master Issuer has not repaid or refinanced the Class A-2 Notes prior to the respective anticipated repayment date, additional interest will accrue pursuant to the Indenture.

~~Restricted Cash —~~ ~~In accordance~~together with the ~~terms of the Indenture, certain cash accounts have been established with the Indenture trustee for the benefit of the note holders~~applicable make-whole premium and are restricted in their use. As of April 11, 2021, the Master Issuer had restricted cash of $18.1 million, which primarily represented cash collections and cash reserves held by the trustee to be used for payments ofunpaid interest, and ~~commitment fees required for the Class A-1 and A-2 Notes.~~

~~Covenants and Restrictions~~—~~The Notes are subject to a series of covenants and restrictions customary for transactions of this type, including (i) that the Master Issuer maintains specified reserve accounts~~is expected to be used to ~~make required payments in respect~~fund a portion of the Company’s acquisition of Del Taco Restaurants, Inc.

The Company also entered into a new purchase agreement under which it will issue up to $150.0 million of its Series 2022-1 Variable Funding Senior Secured Notes, ~~(ii) provisions relating~~Class A-1 (the “Class A-1 Notes”), which will allow the Company to ~~optional and mandatory prepayments and~~borrow amounts from time to time on a revolving basis. The Class A-I Notes will replace the ~~related payment of specified amounts, including specified make-whole payments in the case of the~~Company’s existing $150.0 million Series 2019-1 Variable Funding Senior Secured Notes, Class ~~A-2 Notes under certain circumstances, (iii) certain indemnification payments in the event, among other things, the assets pledged~~A-1.

Except as collateral for the Notes are in stated ways defective or ineffective and (iv) covenants relating to recordkeeping, access to information and similar matters. The Notes are also subject to customary rapid amortization events provided for in the Indenture, including events tied to failure to maintain stated debt service coverage ratios, the sum of gross sales for specified restaurants being below certain levels on certain measurement dates, certain manager termination events, an event of default, and the failure to repay or refinance the Class A-2 Notes on the applicable scheduled maturity date. The Notes are also subject to certain customary events of default, including events relating to non-payment of required interest, principal, or other amounts due on or with respectdescribed above, there were no material changes to the ~~Notes, failure to comply with covenants within certain time frames, certain bankruptcy events, breaches~~terms of ~~specified representations and warranties, failure of security interests to be effective, and certain judgments. As of April 11, 2021, we were~~any debt obligations since October 3, 2021. The Company was in compliance with ~~all~~its debt covenants as of ~~our debt covenant requirements and were not subject to any rapid amortization events.~~

~~Off-Balance Sheet Arrangements~~

We have entered into certain off-balance sheet contractual obligations and commitments in the ordinary course of business, which are recognized in our condensed consolidated financial statements in accordance with U.S. generally accepted accounting principles. There has been no material change in these arrangements as disclosed in our Management’s Discussion and Analysis of Financial Condition and Results of Operations included in our Annual Report on Form 10-K for the fiscal year ended September 27, 2020. We are not a party to any other off-balance sheet arrangements that have, or are reasonably likely to have, a current or future material effect on our financial condition, results of operations, liquidity, capital expenditures or capital resources.January 23, 2022.

DISCUSSION OF CRITICAL ACCOUNTING ESTIMATES

Critical accounting estimates are those that we believe are most important for the portrayal of the Company’s financial condition and results, and that require management’s most subjective and complex judgments. Judgments and uncertainties regarding the application of these policies may result in materially different amounts being reported under various conditions or using different assumptions. There have been no material changes to the critical accounting estimates previously disclosed in the Company’s Annual Report on Form 10-K for the fiscal year ended ~~September 27, 2020.~~October 3, 2021.

NEW ACCOUNTING PRONOUNCEMENTS

Refer to Note 1, Basis of Presentation, of the notes to condensed consolidated financial statements.

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CAUTIONARY STATEMENTS REGARDING FORWARD-LOOKING STATEMENTS

This report contains forward-looking statements within the meaning of the federal securities laws, including further impacts that COVID-19 pandemic may have on our future operations. Any statements contained herein that are not historical facts may be deemed to be forward-looking statements. Forward-looking statements may be identified by words such as “anticipate,” “assume,” “believe,” “estimate,” “expect,” “forecast,” “goals,” “guidance,” “intend,” “plan,” “project,” “may,” “will,” “would”, “should” and similar expressions. These statements are based on management’s current expectations, estimates, forecasts and projections about our business and the industry in which we operate. These estimates and assumptions involve known and unknown risks, uncertainties, and other factors that are in some cases beyond our control. Factors that may cause our actual results to differ materially from any forward-looking statements include, but are not limited to:

•The COVID-19 pandemic has disrupted and ~~is expected to~~may continue to disrupt our business, which has affected and could continue to materially affect our operations, financial condition, and results of operations for an extended period of time.

•We face significant competition in the food service industry and our inability to compete may adversely affect our business.

•Changes in demographic trends and in customer tastes and preferences could cause sales and the royalties we receive from franchisees to decline.

•Changes in consumer confidence and declines in general economic conditions could negatively impact our financial results.

•Increases in food and commodity costs could decrease our profit margins or result in a modified menu, which could adversely affect our financial results.

•Failure to receive scheduled deliveries of high-quality food ingredients and other supplies could harm our operations and reputation.

•We have a limited number of suppliers for our major products and rely on a distribution network with a limited number of distribution partners for the majority of our national distribution program. If our suppliers or distributors are unable to fulfill their obligations under their contracts, it could harm our operations.

•Food safety and food-borne illness concerns may have an adverse effect on our business by reducing demand and increasing costs.

•Negative publicity relating to our business or industry could adversely impact our reputation.

•~~Our business~~Changes in the availability of and the cost of labor could be adversely ~~affected by increased labor costs.~~affect our business.

•Inability to attract, train and retain top-performing personnel could adversely impact our financial results or business.

•We may not have the same resources as our competitors for marketing, advertising and promotion.

•We may be adversely impacted by severe weather conditions, natural disasters, terrorist acts or civil unrest that could result in property damage, injury to employees and staff, and lost restaurant sales.

•We may not achieve our development goals.

•Our ~~highly franchised~~highly-franchised business model presents a number of risks, and the failure of our franchisees to operate successful and profitable restaurants could negatively impact our business.

•We are subject to financial and regulatory risks associated with our owned and leased properties and real estate development projects.

•~~Our tax provision may fluctuate due to changes in expected earnings.~~

•We are subject to the risk of cybersecurity breaches, intrusions, data loss, or other data security incidents.

•We are subject to risks associated with our increasing dependence on digital commerce platforms and technologies to maintain and grow sales, and we cannot predict the impact that these digital commerce platforms and technologies, other new or improved technologies or alternative methods of delivery may have on consumer behavior and our financial results.

•We are dependent on information technology and digital service providers and any material failure, misuse or interruption of our computer systems, supporting infrastructure, consumer-facing digital capabilities or social media platforms could adversely affect our business.

•If we fail to maintain an effective system of internal controls, we may not be able to accurately determine our financial results or prevent fraud. As a result, the Company’s stockholders could lose confidence in our financial results, which would harm our business and the value of the Company’s common shares.

•We may not be able to adequately protect our intellectual property, which could harm the value of our ~~brands~~brand and adversely affect our business.

•Jack in the Box may be subject to risk associated with disagreements with key stakeholders, such as franchisees.

•The securitized debt instruments issued by certain of our wholly-owned subsidiaries have restrictive terms, and any failure to comply with such terms could result in default, which could harm the value of our brand and adversely affect our business.

•We have a significant amount of debt outstanding. Such indebtedness, along with the other contractual commitments of our Company or its subsidiaries, could adversely affect our business, financial condition and results of operations, as well as the ability of certain of our subsidiaries to meet debt payment obligations.

•The securitization transaction documents impose certain restrictions on our activities or the activities of our subsidiaries, and the failure to comply with such restrictions could adversely affect our business.

•~~Changes in accounting standards may negatively impact our results of operations.~~

•We are subject to increasing legal complexity and may be subject to claims or lawsuits that are costly to defend and could result in our payment of substantial damages or settlement costs.

•Unionization activities or labor disputes may disrupt our operations and affect our profitability.

•Increasing regulatory and legal complexity may adversely affect restaurant operations and our financial results.

•Our insurance may not provide adequate levels of coverage against claims.

•Changes in tax laws, interpretations of existing tax law, or adverse determinations by tax authorities could adversely affect our income tax expense and income tax payments.

•Increasing regulatory and legal complexity may adversely affect restaurant operations and our financial results.

•Governmental regulation may adversely affect our existing and future operations and results, including by harming our ability to profitably operate our restaurants.

•The proliferation of federal, state, and local regulations increases our compliance risks, which in turn could adversely affect our business.

•Legislation and regulations regarding our products and ingredients, including the nutritional content of our products, could impact customer preferences and negatively impact our financial results.

•~~Failure to obtain and maintain required licenses and permits or to comply with food control regulations could lead to the loss of our food service licenses and, thereby, harm our business.~~

•Our quarterly results and, as a result, the price of our common stock, may fluctuate significantly and could fall below the expectations of securities analysts and investors due to various factors.

•Actions of activist stockholders could cause us to incur substantial costs, divert management’s attention and resources, and have an adverse effect on our business.

•We may not complete the acquisition of Del Taco within the time frame we anticipate or at all; the acquisition may cause our financial results to differ from our expectations or the expectations of the investment community; and we may not be able to achieve anticipated benefits of the acquisition.

These and other factors are identified and described in more detail in our filings with the Securities and Exchange Commission, including, but not limited to: the “Discussion of Critical Accounting Estimates,” and other sections in this Form 10-Q and the “Risk Factors” section of our most recent Annual Report on Form 10-K for the fiscal year ended ~~September 27, 2020~~October 3, 2021 (“Form 10-K”). These documents may be read free of charge on the SEC’s website at www.sec.gov. Potential investors are urged to consider these factors, more fully described in our Form 10-K, carefully in evaluating any forward-looking statements, and are cautioned not to place undue reliance on the forward-looking statements. All forward-looking statements are made only as of the date issued, and we do not undertake any obligation to update any forward-looking statements.

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ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

There have been no material changes in our quantitative and qualitative market risks set forth in Part II, Item 7A “Quantitative and Qualitative Disclosures About Market Risk” in our Annual Report on Form 10-K for the fiscal year ended ~~September 27, 2020.~~October 3, 2021.

ITEM 4. CONTROLS AND PROCEDURES

Conclusion Regarding the Effectiveness of Disclosure Controls and Procedures

Based on an evaluation of the Company’s disclosure controls and procedures (as defined in Rules 13a-15 and 15d-15 of the Securities Exchange Act of 1934, as amended), as of the end of the Company’s quarter ended ~~April 11, 2021,~~January 23, 2022, the Company’s Chief Executive Officer and Chief Financial Officer (its principal executive officer and principal financial officer, respectively) have concluded that the Company’s disclosure controls and procedures were effective.

Changes in Internal Control over Financial Reporting

There have been no changes in the Company’s internal control over financial reporting that occurred during the Company’s fiscal quarter ended ~~April 11, 2021~~January 23, 2022 that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

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PART II. OTHER INFORMATION

There is no information required to be reported for any items under Part II, except as follows:

ITEM 1. LEGAL PROCEEDINGS

See Note ~~11,~~12, Commitments and Contingencies, of the notes to the condensed consolidated financial statements for a discussion of our contingencies and legal matters.

ITEM 1A. RISK FACTORS

~~When evaluating our business and our prospects, you should consider~~The risk factors set forth below contain material changes to the ~~risks and uncertainties described under Item 1A of Part I of~~risk factors previously disclosed in our Annual Report on Form 10-K for the fiscal year ended ~~September 27, 2020,~~October 3, 2021, which we filed with the SEC on November ~~18, 2020,~~23, 2021, as updated in this Item 1A. You should also consider the risks and uncertainties discussed under the heading “Cautionary Statements Regarding Forward-Looking Statements” in Item 2 of this Quarterly Report on Form 10-Q. You should also refer to the other information set forth in this Quarterly Report and in our Annual Report on Form 10-K for the fiscal year ended ~~September 27, 2020,~~October 3, 2021, including our financial statements and the related notes. These risks and uncertainties are not the only ones we face. Additional risks and uncertainties not presently known to us or that we currently consider immaterial may also impair our business operations. If any of the risks or uncertainties actually occurs, our business and financial results could be harmed. In that case, the market price of our common stock could decline.

We may not complete the acquisition of Del Taco within the time frame we anticipate or at all; the acquisition may cause our financial results to differ from our expectations or the expectations of the investment community; and we may not be able to achieve anticipated benefits of the acquisition.

The completion of the acquisition of Del Taco is subject to a number of conditions. The failure to satisfy all of the required conditions could delay the completion of the acquisition for a significant period of time or prevent it from occurring at all. In addition, the terms and conditions of the required regulatory authorizations and consents for the acquisition that are granted, if any, may impose requirements, limitations or costs or place restrictions on the conduct of our business after the transaction or may materially delay the completion of the acquisition. A delay in completing the acquisition could cause us to realize some or all of the benefits later than we otherwise expect to realize if the acquisition is successfully completed within the anticipated timeframe.

The success of the acquisition will depend, in part, on our ability to successfully combine and integrate the business of Del Taco and realize the anticipated benefits, including synergies, cost savings, and operational efficiencies, from the acquisition. If we are unable to successfully combine and integrate the business of Del Taco within the anticipated time frame, or at all, the anticipated benefits may not be fully realized.

Similar to our Series 2019-1 Class A-2-I Notes, the new securitized debt instruments issued by certain of our wholly-owned subsidiaries have restrictive terms, and any failure to comply with such terms could result in default, which could harm the value of our brand and adversely affect our business.

The Series 2022-1 Senior Notes are subject to a series of covenants and restrictions customary for transactions of this type, including (i) that the Master Issuer maintains specified reserve accounts to be used to make required payments in respect of the Series 2022-1 Senior Notes, (ii) provisions relating to optional and mandatory prepayments and the related payment of specified amounts, including specified make-whole payments in the case of the Series 2022-1 Class A-2 Notes under certain circumstances, (iii) certain indemnification payments in the event, among other things, the assets pledged as collateral for the Series 2022-1 Senior Notes are in stated ways defective or ineffective and (iv) covenants relating to record keeping, access to information and similar matters. The Series 2022-1 Senior Notes are also subject to customary rapid amortization events provided for in the indenture, including events tied to failure to maintain stated debt service coverage ratios, the sum of gross sales for specified restaurants being below certain levels on certain measurement dates, certain manager termination events, an event of default, and the failure to repay or refinance the Series 2022-1 Class A-2 Notes on the applicable scheduled maturity date. The Series 2022-1 Senior Notes are also subject to certain customary events of default, including events relating to non-payment of required interest, principal, or other amounts due on or with respect to the Series 2022-1 Senior Notes, failure to comply with covenants within certain time frames, certain bankruptcy events, breaches of specified representations and warranties, failure of security interests to be effective, and certain judgments.

In the event that a rapid amortization event occurs under the indenture (including, without limitation, upon an event of default under the indenture or the failure to repay the securitized debt at the end of the applicable term) which would require repayment of the Series 2022-1 Senior Notes, the funds available to us would be reduced or eliminated, which would in turn reduce our ability to operate and/or grow our business. If our subsidiaries are not able to generate sufficient cash flow to service their debt obligations, they may need to refinance or restructure debt, sell assets, reduce or delay capital investments, or seek to raise additional capital. If our subsidiaries are unable to implement one or more of these alternatives, they may not be able to meet debt payment and other obligations which could have a material adverse effect on our financial condition.

We have a significant amount of debt outstanding. Such indebtedness, along with the other contractual commitments of our Company or its subsidiaries, could adversely affect our business, financial condition and results of operations, as well as the ability of certain of our subsidiaries to meet debt payment obligations.

Upon completion of its refinancing transaction, as of February 11, 2022, the Master Issuer has outstanding debt of $1.82 billion.

This level of debt could have certain material adverse effects on the Company, including but not limited to:

•our available cash flow in the future to fund working capital, capital expenditures, acquisitions, and general corporate or other purposes could be impaired, and our ability to obtain additional financing for such purposes is limited;

•a substantial portion of our cash flows could be required for debt service and, as a result, might not be available for our operations or other purposes;

•any substantial decrease in net operating cash flows or any substantial increase in expenses could make it difficult for us to meet our debt service requirements or could force us to modify our operations or sell assets;

•our ability to operate our business and our ability to repurchase stock or pay cash dividends to our stockholders may be restricted by the financial and other covenants set forth in the indenture;

•our ability to withstand competitive pressures may be decreased; and

•our level of indebtedness may make us more vulnerable to economic downturns and reduce our flexibility in responding to changing business, regulatory, and economic conditions.

In addition, we may incur additional indebtedness in the future. If new debt or other liabilities are added to our current consolidated debt levels, the related risks that it now faces could intensify.

Similar to the Series 2019-1 Class A-2-I Notes, the securitization transaction documents impose certain restrictions on our activities or the activities of our subsidiaries, and the failure to comply with such restrictions could adversely affect our business.

The indenture and the management agreement entered into between certain of our subsidiaries and the indenture trustee (the “Management Agreement”) contain various covenants that limit our and our subsidiaries’ ability to engage in specified types of transactions. For example, the indenture and the Management Agreement contain covenants that, among other things, restrict, subject to certain exceptions, the ability of certain subsidiaries to:

•incur or guarantee additional indebtedness;

•sell certain assets;

•alter the business conducted by our subsidiaries;

•create or incur liens on certain assets; or

•consolidate, merge, sell or otherwise dispose of all or substantially all of the assets held within the securitization entities.

As a result of these restrictions, we may not have adequate resources or the flexibility to continue to manage the business and provide for growth of the Jack in the Box system, including product development and marketing for the Jack in the Box brand, which could adversely affect our future growth prospects, financial condition, results of operations and liquidity.

Changes in the availability of and the cost of labor could adversely affect our business.

Our business could be adversely impacted by increases in labor costs, including those increases triggered by regulatory actions regarding wages, scheduling and benefits; increased health care and workers’ compensation insurance costs; increased wages and costs of other benefits necessary to attract and retain high quality employees with the right skill sets and increased wages, benefits and costs related to the COVID-19 pandemic and inflationary and other pressure on wages now being experienced. The growth of our business can make it increasingly difficult to locate and hire sufficient numbers of employees, to maintain an effective system of internal controls, and to train employees to deliver a consistently high-quality product and customer experience, which could materially harm our business and results of operations. Furthermore, we have experienced, and could continue to experience, a shortage of labor for restaurant positions, including due to concerns around and illnesses arising from COVID-19 and its various novel variants and other factors, which could decrease the pool of available qualified talent for key functions and require restaurants to operate on reduced hours. Such labor shortages could be further exacerbated by expanded federal, state and local COVID-19 vaccination requirements. In addition, our wages and benefits programs may be insufficient to attract and retain the top performing employees especially in a rising wage market.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

Stock Repurchases — ~~In the second quarter of 2021 we repurchased 0.6 million~~We did not repurchase any shares of our common stock ~~for an aggregate cost~~in the first quarter of ~~$65.0 million.~~2022. As of ~~April 11, 2021,~~January 23, 2022, there was ~~$35.0~~$200.0 million remaining under the Board-authorized stock buyback program which expires in November ~~2021 and $100.0 million which expires in November 2022.~~2023.

(a)
Total number of shares purchased (b)
Average price paid per share (c)
Total number of shares purchased as part of publicly announced programs (d)
Maximum dollar value that may yet be purchased under these programs
$ 200,000,000
January 18, 2021 - February 14, 2021 — $ — — $ 200,000,000
February 15, 2021 - March 14, 2021 566,528 $ 100.11 566,528 $ 143,286,701
March 15, 2021 - April 11, 2021 74,181 $ 111.71 74,181 $ 135,000,010
Total 640,709 640,709

ITEM 3. DEFAULTS OF SENIOR SECURITIES

None.

ITEM 4. MINE SAFETY DISCLOSURES

Not applicable.

ITEM 5. OTHER INFORMATION

Item 5.03. None.

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ITEM 6. EXHIBITS


Number	Description	Form	Filed with SEC
10.2.22*2.1	~~Offer Letter~~Agreement and Plan of Merger, dated as of December 5, 2021, by and among Jack in the Box Inc, Epic Merger Sub Inc., and Del Taco Restaurants, Inc.	8-K	12/6/2022
10.1	Voting Agreement, dated as of December 5, 2021, by and among Jack in the Box Inc., Belfer Investment Partners LP and Lime Partners LLC	8-K	12/6/2022
10.2	Voting Agreement, dated as of December 5, 2021, by and among Jack in the Box Inc., Levy Family Partners LLC, Lawrence F. Levy, Ari Levy and certain other Del Taco stockholders party thereto	8-K	12/6/2022
10.3	2022-1 Class A-2 Note Purchase Agreement, dated as of February 2, 2022, by and among Jack in the Box Inc., the subsidiaries of Jack in the Box Inc. party thereto and Guggenheim Securities, LLC acting on behalf of itself and as the representative of the initial purchasers.	8-K	2/3/2022
10.4	Series 2022-1 Supplement to Base Indenture, dated as of February 11, 2022, by and between ~~Steven Piano~~Jack in the Box Funding, LLC, as Master Issuer of the Series 2022-1 fixed rate senior secured notes, Class A-2, and Series 2022-1 variable funding senior notes, Class A-1, and Citibank, N.A., as Trustee and Series 2022-1 Securities Intermediary.	8-K	2/15/2022
10.5	First Supplement to the Base Indenture, dated as of February 11, 2022, by and between Jack in the Box Funding, LLC, as Master Issuer, and Citibank, N.A., as Trustee and Securities Intermediary.	8-K	2/15/2022
10.6	Class A-1 Note Purchase Agreement, dated as of February 11, 2022, by and among Jack in the Box Funding, LLC, as Master Issuer, each of Different Rules, LLC, Jack in the Box Properties, LLC and Jack in the Box SPV Guarantor, LLC, as Guarantors, Jack in the Box Inc. as Manager, the conduit investors party thereto, the financial institutions party thereto, certain funding agents, and Coöperatieve Rabobank U.A., ~~dated March 23, 2021~~New York Branch, as L/C Provider, Swingline Lender and Administrative Agent.	—8-K	~~Filed herewith~~2/15/2022
10.2.23*10.7	~~Offer Letter~~First Amendment to the Management Agreement, dated as of February 11, 2022, by and ~~between Carlson Choi and~~among Jack in the Box Funding, LLC, as Master Issuer, certain subsidiaries of Jack in the Box Funding, LLC party thereto, Jack in the Box Inc., ~~dated March 30, 2021~~as Manager, and Citibank, N.A., as Trustee.	—8-K	~~Filed herewith~~
10.2.24*	~~Melissa Corrigan Separation and Release Agreement, dated~~ ~~May~~ 7 , ~~2021~~	—	~~Filed herewith~~
10.2.25*	~~Andrew Martin Separation and Release Agreement, dated May 10, 2021~~	—	~~Filed herewith~~2/15/2022
31.1	Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002	—	Filed herewith
31.2	Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002	—	Filed herewith
32.1	Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002	—	Filed herewith
32.2	Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002	—	Filed herewith
101.INS	iXBRL Instance Document
101.SCH	iXBRL Taxonomy Extension Schema Document
101.CAL	iXBRL Taxonomy Extension Calculation Linkbase Document
101.DEF	iXBRL Taxonomy Extension Definition Linkbase Document
101.LAB	iXBRL Taxonomy Extension Label Linkbase Document
101.PRE	iXBRL Taxonomy Extension Presentation Linkbase Document
104	Cover Page Interactive Data File formatted in iXBRL

* Management contract or compensatory plan

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SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.


			JACK IN THE BOX INC.

			By:			/S/ TIM MULLANY
						Tim Mullany
						Executive Vice President and Chief Financial Officer (principal financial officer) (Duly Authorized Signatory)

Date: ~~May 12, 2021~~February 23, 2022

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	Increase/(Decrease)
	Quarter		Year-to-date
Advertising	$	792	$	1,243
Incentive compensation (including share-based compensation and related payroll taxes)	2,282		2,573
Cash surrender value of COLI policies, net	(5,914)		(8,578)
Litigation matters	(1,891)		(5,822)
Insurance	(2,064)		(2,356)
Other	1,453		(151)
	$	(5,342)	$	(13,091)


	(a) Total number of shares purchased	(b) Average price paid per share		(c) Total number of shares purchased as part of publicly announced programs	(d) Maximum dollar value that may yet be purchased under these programs
					$	200,000,000
January 18, 2021 - February 14, 2021	—	$	—	—	$	200,000,000
February 15, 2021 - March 14, 2021	566,528	$	100.11	566,528	$	143,286,701
March 15, 2021 - April 11, 2021	74,181	$	111.71	74,181	$	135,000,010
Total	640,709			640,709