Business Combination (Tables)

12 Months Ended

Oct. 02, 2022

Business Combination and Asset Acquisition [Abstract]

Schedule of Franchise Acquisitions

The following summarizes the purchase consideration paid to Del Taco shareholders (in thousands, except per share data):

	Amount
Del Taco shares outstanding as of March 8, 2022	36,442
Del Taco RSAs subject to accelerated vesting	805
Del Taco RSUs subject to accelerated vesting	70
Del Taco options subject to accelerated vesting	292
Total Del Taco shares outstanding	37,610
Merger Consideration (per Del Taco share)	$	12.51
Total cash consideration paid to selling shareholders	$	470,500
Del Taco transaction costs paid by Jack in the Box (1)	7,141
Del Taco closing indebtedness settled by Jack in the Box (2)	115,219
Replacement share-based payment awards pre-combination vesting expense	449
Total aggregate purchase consideration	$	593,309

____________________________

(1)Represents the portion of Del Taco merger-related transaction costs that were paid at the Closing Date by the Company.

(2)Represents the closing indebtedness of Del Taco’s existing debt that was paid at the Closing Date by the Company.

The final allocation of the purchase consideration, which includes measurement-period adjustments recorded in our third and fourth quarters of fiscal 2022, is as follows (in thousands):

	Initial Allocation of Consideration		Measurement Period Adjustments		October 2, 2022
Total aggregate purchase consideration, net of $12,068 cash acquired	$	581,241	$	—	$	581,241
Assets:
Accounts and other receivables	3,809		774		4,583
Inventories	3,233		—		3,233
Prepaid expenses	2,950		—		2,950
Other current assets	105		—		105
Property and equipment	150,826		(5,794)		145,032
Operating lease right-of-use assets	349,489		800		350,289
Intangible assets	12,371		—		12,371
Trademarks	283,500		—		283,500
Other assets	5,128		—		5,128
Liabilities:
Current maturities of long-term debt	22		—		22
Current operating lease liabilities	21,991		—		21,991
Accounts payable	18,808		—		18,808
Accrued liabilities	66,739		45,840		112,579
Long-term debt, net of current maturities	349		—		349
Long-term operating lease liabilities, net of current portion	302,688		800		303,488
Deferred tax liabilities	88,203		(12,848)		75,355
Other long-term liabilities	13,080		—		13,080
Net assets acquired, excluding goodwill	$	299,531	$	(38,012)	$	261,519
Goodwill	$	281,710	$	38,012	$	319,722

The following table provides detail of the combined acquisitions in 2022, 2021, and 2020 (dollars in thousands):

	2022		2021		2020
Restaurants acquired from franchisees	13		20		8
Inventory	$	—	$	258	$	73
Property and equipment	540		1,136		903
Intangible assets	66		245		263
Other assets	—		10		6
Goodwill	—		613		414
Gains on the acquisition of franchise-operated restaurants	(309)		(340)		—
Liabilities assumed	—		(277)		(800)
Total consideration	$	297	$	1,645	$	859

Business Combination, Goodwill Segment Allocation

The goodwill arising from the Del Taco acquisition has been allocated to the Company’s reporting units as follows (in thousands):

Del Taco brand	$	230,722
Jack in the Box brand	89,000
Total acquisition date goodwill	$	319,722

Schedule of Intangible Assets and the Useful Lives

The values allocated to intangible assets and the useful lives are as follows (in thousands):

	Amount		Weighted Average Useful Life (Years)
Trademarks	$	283,500	Indefinite
Franchise contracts	9,700		18
Sublease assets	2,671		13
Estimated fair value of acquired intangible assets	$	295,871

Schedule of Pro Forma Information

The following unaudited pro forma combined financial information presents the Company’s results as though Del Taco and the Company had been combined as the beginning of fiscal year 2021 (in thousands):

	2022		2021
Total revenue	$	1,686,160	$	1,665,660
Net earnings	$	118,000	$	133,485