UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 14A INFORMATION

Proxy Statement Pursuant to Section 14(a) of the

Securities Exchange Act of 1934

 

☑  Filed by the registrant                  ☐  Filed by a party other than the registrant

 

Check the appropriate box:
☐ 

Preliminary Proxy Statement

☐ CONFIDENTIAL, FOR USE OF THE COMMISSION ONLY (AS PERMITTED BY RULE 14A-6(E)(2))
☑ 

Definitive Proxy Statement

☐ 

Definitive Additional Materials

☐ 

Soliciting Material Pursuant to Section 240.14a-12

JACK IN THE BOX INC.

(Name of Registrant as Specified in Its Charter)

(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

 

Payment of filing fee (check the appropriate box):
☑ 

No fee required.

☐ 

Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11

  

(1) Title of each class of securities to which transaction applies:

 

 

  

(2) Aggregate number of securities to which transaction applies:

 

  

(3) Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is calculated and state how it was determined):

 

  

(4) Proposed maximum aggregate value of transaction:

 

  

(5) Total fee paid:

 

☐ 

Fee paid previously with preliminary materials.

☐ Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing.
  

(1) Amount Previously Paid:

 

  

(2) Form, Schedule or Registration Statement No.:

 

  

(3) Filing Party:

 

  

(4) Date Filed:

 

 

LOGO

  JACK IN THE BOX INC.

January 28, 201927, 2020

Dear Fellow Stockholder:

We invite you to attend the Jack in the Box Inc. 20192020 Annual Meeting of Stockholders. The meeting will be held on Friday, March 1, 2019,February 28, 2020, at 8:30 a.m. Pacific Standard Time at the offices of Jack in the Box Inc., 9330 Balboa Avenue, San Diego, CA 92123. In the following pages, you will find the Notice of Annual Meeting of Stockholders as well as a Proxy Statement describing the business to be conducted at the meeting. We have also enclosed a copy of our Annual Report on FormForm 10-K for the fiscal year ended September 30, 2018,29, 2019, for your information.

To assure that your shares are represented at the meeting, please mark your choices on the enclosed proxy card, sign and date the card, and return it promptly in the postage-paid envelope provided. We also offer stockholders the opportunity to vote their shares over the Internet or by telephone. Please see the Proxy Statement and the enclosed proxy card for details about voting. If you hold your shares through an account with a broker, bank, or other financial institution, please follow the instructions you receive from them to vote your shares. If you are able to attend the meeting and wish to vote your shares in person, you may do so at any time before the proxy is voted at the meeting.

Sincerely,

 

LOGO

Leonard A. Comma

Chairman of the Board and Chief Executive Officer

Important notice regarding the availability of proxy materials

for the Annual Meeting of Stockholders to be held on March 1, 2019February 28, 2020

The Jack in the Box Inc. Proxy Statement and Annual Report on FormForm 10-K for the

fiscal year ended September 30, 2018,29, 2019, are available electronically at

http://investors.jackinthebox.com

 

INFORMATION REGARDING ADMISSION TO THE ANNUAL MEETING

Everyone attending the 20192020 Annual Meeting of Stockholders will be required to present both proof of ownership of Jack in the Box Inc. Common Stock and a valid picture identification, such as a driver’s license or passport. If your shares are held in the name of a bank, broker or other financial institution, you will need a recent brokerage statement or letter from such entity reflecting your stock ownership as of the record date. If you do not have both proof of ownership of Jack in the Box Inc. stock and a valid picture identification, you may be denied admission to the Annual Meeting.

Cameras, sound or video recording devices, and large bags or packages will not be allowed in the meeting room.

TABLE OF CONTENTS

   Page 

Notice of 20192020 Annual Meeting of Stockholders

   1 

Proxy Summary

   2 

Questions and Answers

   89 

Proxy Materials and Voting Information

   89 

Annual Meeting Information

   1213 

Communications and Stockholder Proposals

   1314 

Proposal 1 — Election of Directors

   1415 

Nominees for Director

   1415 

Director Qualifications and Biographical Information

   1516

Current Director Not Standing for Re-Election

21 

Corporate Governance

   2022 

Directors’ Independence

   2022 

Board Meetings, Annual Meeting of Stockholders and Attendance

   2022 

Determination of Current Board Leadership Structure

   2022 

Lead Director

   2123 

The Board’s Role in Risk Oversight

   2123 

The Board’s Role in Succession Planning

   2224 

Committees of the Board

   2224 

Committee Member Independence

   2325 

Executive Sessions

   2325 

Board Composition and Refreshment

   2326 

Stockholder Recommendations and Board Nominations

   2426 

Code of Conduct

   2527 

Compensation Committee Interlocks and Insider Participation

   2527 

Additional Corporate Governance Principles and Practices

   2527 
Director Compensation and Stock Ownership Guidelines   2629 
Report of the Audit Committee   2932 
Independent Registered Public Accountants Fees and Services   3033 
Proposal 2 — Ratification of the Appointment of Independent Registered Public Accountants   3134 
Proposal 3 — Advisory Vote on Executive Compensation   3235 
   Page 

Compensation Discussion and Analysis

   3437 

I.     Executive Summary

   3437 

II.    Compensation Principles and Objectives

   3942 

III.   Compensation Competitive Analysis

   4043 

IV.   Elements of Compensation

   4144 

V.    Compensation Decision-Making Process

   4346 

VI.   Fiscal 20182019 Compensation

   4447 

VII.  Additional Compensation Information

   4952 

VIII. CEO Pay Ratio Disclosure

   5456 

Compensation Committee Report

   5557 

Compensation Risk Analysis

   5658 

Executive Compensation

   5759 

Summary Compensation Table

   5759 

Grants of Plan-Based Awards

   5961 

Outstanding Equity Awards at FiscalYear-End 20182019

   6062 

Option Exercises and Stock Vested in Fiscal 20182019

   6163 

Retirement Plan Benefits

   6163 

Non-Qualified Deferred Compensation

   6264 

Potential Payments on Termination of Employment or Change in Control

   6365 
Security Ownership of Certain Beneficial Owners and Management   68
Other Information70 

Section 16(a) Beneficial Ownership Reporting ComplianceOther Information

   7072 

Certain Relationships and Related Transactions

   7072 
Appendix A — Reconciliation ofNon-GAAP Measurements to GAAP Results   A-1 
 

JACK IN THE BOX INC.

9330 Balboa Avenue

San Diego, California 92123

 

 

LOGO

NOTICE OF ANNUAL MEETING OF STOCKHOLDERS

To Be Held March 1, 2019February 28, 2020

The 20192020 Annual Meeting of Stockholders of Jack in the Box Inc. will be held on Friday, March 1, 2019,February 28, 2020, at 8:30 a.m. Pacific Standard Time, at the offices of Jack in the Box Inc., 9330 Balboa Avenue, San Diego, CA 92123 for the following purposes:

 

1.

To elect the nineten Directors specified in this Proxy Statement to serve until the next Annual Meeting of Stockholders and until their respective successors are elected and qualified;

 

2.

To ratify the appointment of KPMG LLP as our independent registered public accountants for the fiscal year ending September 29, 2019;27, 2020;

 

3.

To provide an advisory vote regarding the compensation of our named executive officers (“Say on Pay”) for the fiscal year ended September 30, 2018,29, 2019, as set forth in the Proxy Statement; and

 

4.

To consider such other business as may properly come before the meeting and any adjournments or postponements thereof.

These matters are more fully described in the attached Proxy Statement, which is made a part of this notice.

Our Board of Directors recommends a vote“FOR” “FOR” proposals 1 through 3. You are entitled to vote at the 20192020 Annual Meeting of Stockholders (the “Annual Meeting”) only if you were a Jack in the Box Inc. stockholder as of the close of business on January 25,December 30, 2019, the record date for the Annual Meeting. A complete list of stockholders entitled to vote at the Annual Meeting will be available for examination by any stockholder, for any purpose relating to the Annual Meeting, at the Annual Meeting, and for a period of ten days prior to the Annual Meeting, during regular business hours at our principal offices located at 9330 Balboa Avenue, San Diego, CA 92123.

Whether or not you plan to attend the Annual Meeting, we urge you to vote your shares via the toll-free telephone number, over the Internet, or by signing, dating, and returning the enclosed proxy card as promptly as possible in the envelope provided.

San Diego, California

January 28, 201927, 2020

By order of the Board of Directors,

 

LOGO

Phillip H. Rudolph

Executive Vice President, Chief Legal & Risk Officer and Corporate Secretary

 

INFORMATION REGARDING ADMISSION TO THE ANNUAL MEETING

Everyone attending the 20192020 Annual Meeting of Stockholders will be required to present both proof of ownership of Jack in the Box Inc. Common Stock and a valid picture identification, such as a driver’s license or passport. If your shares are held in the name of a bank, broker or other financial institution, you will need a recent brokerage statement or letter from such entity reflecting your stock ownership as of the record date. If you do not have both proof of ownership of Jack in the Box Inc. stock and a valid picture identification, you may be denied admission to the Annual Meeting.

Cameras, sound or video recording devices, and large bags or packages will not be allowed in the meeting room.

 

  PROXY SUMMARY  

    

 

PROXY SUMMARY

This is a summary only, and does not contain all of the information that you should consider in connection with this Proxy Statement. Please read the entire Proxy Statement carefully before voting.

Annual Meeting of Stockholders

 

•  Time and Date

  

8:30 a.m. P.S.T., March 1, 2019February 28, 2020

•  Place

  

9330 Balboa Avenue, San Diego, California 92123

•  Record date

  

January 25,December 30, 2019

•  Voting

  

Stockholders as of the record date are entitled to vote. Each share of common stock is entitled to one vote for each director nominee and one vote for each of the proposals.

•  Admission

  

Proof of ownership and picture identification is required to enter Jack in the Box Inc.’s annual meeting.

Voting Matters

 

Stockholders are being asked to vote on the following matters:

 

  Items of Business

  

Our Board’s Recommendation   

  1.  Election of Directors (page 14)

15)

  

FOR all Nominees

  2.  Ratification of KPMG LLP as Independent Registered Public Accountants for FY 20192020 (page 31)

34)

  

FOR

  3.  Advisory Vote to Approve Executive Compensation (page 32)

35)

  

FOR

Stockholders also will transact any other business that may properly come before the meeting.

How to Vote

 

You are entitled to vote at the 20192020 Annual Meeting of Stockholders if you were a stockholder of record at the close of business on January 25,December 30, 2019, the record date for the meeting. On the record date, there were approximately 25,806,80423,088,516 shares of the Company’s common stock outstanding and entitled to vote at the annual meeting. For more details on voting and the annual meeting logistics, refer to the “Questions and Answers” section of this Proxy Statement.



 

2    JACK IN THE BOX INC.  ï  20192020 PROXY STATEMENT

    

 

  PROXY SUMMARY  

 

Corporate Governance Highlights

 

We areJack in the Box Inc. (“Jack in the Box” or the “Company”) is committed to good corporate governance, which we believe promotes the long-term interests of stockholders and strengthens Board and Management accountability. We believe good governance also fosters trust in the Company by all our stakeholders, including our guests, employees, franchisees, suppliers and the communities we serve. The “Corporate Governance” section of this Proxy Statement describes our governance framework, which includes the following features:

 

•    Annual election of directors, with majority voting

•     Annual assessment of Board leadership structure

•    8 of 9 independent directors

•     Annual Board, committee and individual director evaluations

•    Regular executive sessions of independent directors

•     Policy requiring long-tenured directors (more than 12 years on the Board) to submit voluntary offer to resign and be reviewed by Nominating & Governance Committee with respect to continued effectiveness

•    Annual evaluation of CEO/Chairman by independent directors

•     Lead independent director with restaurant and franchise experience and oversight of independent directors’ executive sessions and information flow to the Board

•    Policy restricting directors to service on no more than three other public company boards

•     Risk oversight by full Board and designated committees

•    No supermajority standards — stockholders may amend bylaws or charter by majority vote

•     No poison pill in place

•    Stockholder right to act by written consent

•     Prohibition of hedging, pledging and short sales by Section 16 officers and directors

•    CEO/Chairman and other members of Management regularly meet with the investment community, and Board is informed of feedback through Investor Relations update at each Board meeting

•     Formal ethics Code of Conduct, ethics hotline and ethics training and communications to all employees to reinforce a culture of integrity

Annual election of directors, with majority voting

Ten of our 11 directors are independent

Regular executive sessions of independent directors

Annual evaluation of CEO/Chairman by independent directors

Policy restricting directors to service on no more than three other public company boards

No supermajority standards — stockholders may amend bylaws or charter by majority vote

Stockholder right to act by written consent

CEO/Chairman and other members of Management regularly meet with the investment community, and Board is informed of feedback through Investor Relations update at each Board meeting

Annual assessment of Board leadership structure

Annual Board, committee and individual director evaluations

Policy requiring long-tenured directors (more than 12 years on the Board) to submit voluntary offer to resign and be reviewed by Nominating & Governance Committee with respect to continued effectiveness

Lead independent director with restaurant and franchise experience and oversight of independent directors’ executive sessions and information flow to the Board

Risk oversight by full Board and designated committees

No poison pill in place

Prohibition of hedging, pledging and short sales by Section 16 officers and by Company directors.

Formal ethics Code of Conduct, ethics hotline and ethics training and communications to all employees to reinforce a culture of integrity



 

JACK IN THE BOX INC.  ï  20192020 PROXY STATEMENT    3

 

  PROXY SUMMARY  

    

 

Fiscal 20182019 Review

 

Fiscal 20182019 was marked by substantial accomplishments on key strategic initiatives,the Company’s first full year as the Company largely completed its transformation to an asset-light, single-brand organization while operatingorganization. Several restructuring efforts were completed during the year, including the completion of the transition services agreement with Qdoba Restaurant Corporation. Through implementation of a securitization transaction ("Securitization") in a highly competitive restaurant industry. However,the fiscal year, the Company did not meetachieved its target leverage ratio of approximately five times EBITDA. In addition to these structural changes, the Company continued to drive systemwide financial and operational performance. In fiscal 2019, we achieved our annual financial targets which directly impacted annual incentive payouts.ninth consecutive year of same-store sales growth.

Returns to Stockholders

2018 was our fifth consecutive year of returningThe Company returned more than $300$165 million to shareholders through stock buybacks and dividends, which have totaled nearly $1.8 billion over those five years. Fordividends. The Company’s stock price increased 7.3% to $90.45 per share at fiscal 2018 our cumulative total shareholder return (TSR) declined 16%. However, our TSR over the past five years increasedyear-end (“FYE”) 2019, versus $83.83 at a compound annual rate of 17.5%.FYE 2018.

Financial and Operational Results

 

Systemwide same-store sales increased 0.1% over prior year, marking the eighth consecutive year of positive growth.

• 

Restaurant-Level EBITDASystemwide same-store sales(1) increased by 220 basis points to 26.4%1.3% over prior year, marking the ninth consecutive year of company restaurant sales.same-store sales growth.

 

• 

Restaurant Operating MarginEarnings Per Share(1)(2) (“ROM”Operating EPS”) of $4.35 per share increased 260 basis points to 22.7% of company restaurant sales.14.8% from the prior year.

 

• 

Operating Earnings Per ShareAdjusted EBITDA(2)(3) (“Operating EPS”) of $3.79 per share increased over 9% from1.8% to $269.0 million, compared with $264.2 million in the prior year.

Strategic Initiatives

•

Operating EBIT(4) was $207.8 million, a 6% increase versus $196 million in the prior year.

The Company made progress onkey strategic initiatives, including:

•

Restaurant Level Margin(5) decreased by 20 basis points to 26.2% of company restaurant sales.

 

Completing our refranchising initiative which increased our franchise mix to our desired end-stateThrough implementation of 94% at FYE 2018 (from 88% at 2017 fiscal year-end), resulting in higher and more predictable levels of franchise revenuesa securitization in the formfiscal year, the Company achieved its target leverage of royalties and rental income while lowering our future capital spending requirements.

Completing the sale of our Qdoba brand effective March 21, 2018 for approximately $305 million in cash.

Reducing our corporate general and administrative expenses (“G&A”) by 20 basis points to 2.2% of system sales.

Achieving key milestones toward ultimately increasing the Company’s leverage to five times EBITDA.

Incentive Compensation Outcomes

 

• 

TheFor Jack in the Box Operating Earnings Before Interest and Taxes (“Operating EBIT”),(3)(4) the result (weighted 70%) was 39%149% of target goal, and Jack in the Box ROMRestaurant Level Margin(5) performance (weighted 30%) was 82%54% of target goal. Together, these metrics accounted for 80%Accordingly, the CEO and other NEOs received annual incentive payouts of 120.5% of target incentive opportunity.incentive.

 

Management made substantial progress on the four strategic initiatives, as described above, which will better position the Company over the long-term. These four strategic initiatives together accounted for 20% of target incentive.

For fiscal 2018, the CEO and other NEOs received annual incentive payouts of 69.1% of target incentive (except for Ms. Allen who separated in February 2018 and did not receive an incentive). Mr. Rebel’s annual incentive was pro-rated based on his time employed with the Company during fiscal 2018.

Other

The Company hired a new Chief Financial Officer to replace our former long-term CFO who retired during 2018. The Company also hired a new Chief Operating Officer in 2018.

•

For PSUs vested and payable in 2019 (granted in November 2016), the Jack in the Box Return on Invested Capital (ROIC)(6) at FYE19 result was 150% of target, and Systemwide Sales results for the three-fiscal year performance period covering fiscal 2017-2019 (the “Performance Period”) (with goals established at the beginning of each fiscal year of the Performance Period) was 40% of target. In total, the CEO and other NEOs received a weighted payout of 95% of the target number of PSUs granted.

 

(1) 

Restaurant-Level EBITDA (earnings from operationsSystemwide same-store sales represents changes in sales at company and franchise restaurants open more than one year. 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 and percentage rent revenues are calculated based on a GAAP basis adjustedpercentage of franchise sales. We believe system same-store sales information is useful to exclude depreciation and amortization allocated to company restaurant operations and other operating expenses, suchinvestors as general and administrative expenses, which include the costs of functions such as accounting, finance and human resources, and other costs such as pension expense, share-based compensation, impairment and other charges, net, and gains or lossesit has a direct effect on the sale of company-operated restaurants); and Restaurant Operating Margin (defined by the Company as company restaurant sales less expenses incurred directly by our restaurants in generating those sales (food and packaging costs, payroll and employee benefits costs, and occupancy and other costs)) are non-GAAP measures. For a reconciliation of these measures to earnings from operations, the most comparable GAAP measure, please see “Appendix A — Reconciliation of Non-GAAP Measurements to GAAP Results.”Company’s profitability.

(2) 

Operating EPSEarnings Per Share is a non-GAAP measure and is defined by the Company asthat represents diluted EPSearnings per share from continuing operations on a GAAP basis excluding gains or losses on the sale of company-operatedcompany operated restaurants, restructuring charges, loss on early termination of interest rate swaps, loss on early extinguishment of debt, the non-cash impact of the Tax Cuts and Jobs Act in fiscal year 2018, and the excess tax benefits from share-based compensation arrangements which are now recorded as a component of income tax expense versus equity previously. For a reconciliation of this measure to diluted earnings per share from continuing operations, the most comparable GAAP measure, please see “Appendixarrangements. See Appendix A — Reconciliation of Non-GAAP Measurementsnon-GAAP measurements to GAAP Results.”

(3) 

Adjusted EBITDA represents net earnings on a GAAP basis excluding earnings or losses from discontinued operations, income taxes, interest expense, net, gains or losses on the sale of company-operated restaurants, impairment and other charges, net, depreciation and amortization, and the amortization of franchise tenant improvement allowances and other. See Appendix A - Reconciliation of non-GAAP measurements to GAAP Results.

(4)

Operating EBIT is a non-GAAP measure defined by the Company as net earnings before interest expense, net and explainedincome taxes, excluding gains or losses on the sale of company operated restaurants, restructuring costs, and earnings or losses from discontinued operations. See Appendix A — Reconciliation of non-GAAP measurements to GAAP Results.

(5)

Restaurant Level Margin is defined as Company restaurant sales less restaurant operating costs (food and packaging, payroll and employee benefits, and occupancy and other costs) and is neither required by, nor presented in Section VI.baccordance with GAAP. Restaurant Level Margin excludes revenues and expenses of our franchise operations and certain costs, such as selling, general, and administrative expenses, depreciation and amortization, impairment and other charges, net, gains or losses on the Compensation Discussion & Analysissale of this Proxy Statement.company-operated restaurants, and other costs that are considered normal operating costs. See Appendix A — Reconciliation of non-GAAP measurements to GAAP Results.

(6)

Adjusted ROIC is calculated as after-tax earnings from operations, excluding gains or losses on the sale of company-operated restaurants and restructuring charges, divided by average invested capital (which excludes accumulated other comprehensive income or loss related to the Company’s retirement plans).



 

4    JACK IN THE BOX INC.  ï  20192020 PROXY STATEMENT

    

 

  PROXY SUMMARY  

 

Board Nominees(Proposal 1)

 

We understand the importance of having a Board comprised of talented people with the highest integrity and the necessary skills and qualifications to oversee our business. The following table provides summary information about our director nominees (all current Directors), who have a diverse and balanced skill set including extensive financial, marketing, consumer brand, franchise, restaurant and retail experience. We encourage you to review the qualifications, skills and experience of each of our Directors on pages 15-19.15-21.(1)

 

Name Age   Director  
Since  		 Principal Occupation Independent   Committee Memberships 

Other Public

Company

Boards

 Age   

Director  

Since  

 Principal Occupation Independent   Committee
Memberships		 

Other Public
Company

Boards

AC   CC   NG   FC   EC   AC   CC   NG   FC  
    

Leonard A. Comma

(Chairman of the Board)

 49    2014    

CEO,

Jack in the Box Inc.

 No         LOGO - 50    2014    

CEO,

Jack in the Box Inc.

 No         -
    

David L. Goebel

(Lead Director)

 68    2008    

Partner & Faculty Member,

Merryck & Co. Ltd.

 Yes   x x   x Wingstop Inc. 69    2008    Partner & Faculty Member, Merryck & Co. Ltd. Yes   x x   

•  Wingstop Inc.

  

Jean M. Birch

 60    2019    

Director

(Former Chairman and CEO of Papa Murphy’s Holdings, Inc.)

 Yes   x x   

•  CorePoint Lodging Inc.,

•  Forrester Research, Inc.

  

John P. Gainor

 63    2019    

Director

(Former President & CEO, International Dairy Queen)

 Yes   x x   

•  Saia, Inc.      

    

Sharon P. John

 54    2014    

President & CEO,

Build-A-Bear Workshop, Inc.

 Yes   x x     

Build-a-Bear

Workshop, Inc.

 55    2014    

President & CEO,

Build-A-Bear Workshop, Inc.

 Yes   x x   

•  Build-a-Bear Workshop, Inc.

    

Madeleine A. Kleiner

 67    2011    

Director

(Retired hotel & banking

executive attorney)

 Yes   x LOGO     

Northrop

Grumman

Corp.

 68    2011    

Director

(Retired hotel & banking executive attorney)

 Yes x   LOGO   

•  Northrop Grumman Corp.

    

Michael W. Murphy

 61    2002    

President & CEO,

Sharp HealthCare

 Yes LOGO   x   x - 62    2002    

Director

(Retired President & CEO

Sharp HealthCare)

 Yes   x   x -
    

James M. Myers

 61    2010    

Director

(Retired retail CEO and Board Chair)

 Yes x     x   - 62    2010    

Director

(Retired retail CEO and

Board Chair)

 Yes x     LOGO -
   

David M. Tehle

 62    2004    

Director

(Retired retail CFO)

 Yes x     LOGO   

Genesco Inc.,
US Foods Holding
Corp.,
National Vision, Inc.

 63    2004    

Director

(Retired retail CFO)

 Yes LOGO     x 

•  US Foods Holding Corp.,

•  National Vision, Inc.

   

John T. Wyatt

 63    2010    CEO, Knowledge Universe, United States Yes   LOGO   x   -
 

Vivien M. Yeung

 46    2017    

General Manager, Venture, Lululemon Athletica Inc.

 Yes x   x       47    2017    

Director

Strategy consultant forcompanies and non-profits

 Yes x   x   -

 

LOGO    LOGO    Chair

  

AC    Audit Committee

    

FC    Finance Committee

x Member

  

CC    Compensation Committee

    

EC    Executive Committee

  

NG    Nominating and Governance Committee

    

Director Attendance— During the time each director nominee served on the Board in fiscal 2018,2019, each attended more than 75% of the meetings of the Board and committees on which he or she sits.

Board Composition — Our Board has a mix of relatively newer and longer-tenured directors. The charts below show Board makeup by various characteristics. For more information on our philosophy regarding the recruitment and diversity of Board members and our Board refreshment policies, please see pages 23-24.served.

 

LOGO

Director Tenure Average Tenure: 8.5 years Average Age 59 years Director Tenure Average Tenure: 8.5 years Average Age 59 years
(1)

Director John T. Wyatt, the current Compensation Committee Chair, will not be standing forre-election at the Annual Meeting and will be departing as a Director immediately following the Meeting. Mr. Wyatt’s departure is in no way due to any disagreement with the Company nor is it the result of a removal “for cause.” Prior to the Annual Meeting, it is anticipated that the Board will elect to reduce the number of Board seats from eleven to ten. Following the Annual Meeting it is expected that the Company will have no open Director seats.



 

JACK IN THE BOX INC.  ï  20192020 PROXY STATEMENT    5

 

  PROXY SUMMARY  

    

 

Board Composition — The charts below show Board makeup for 2019 by various characteristics. For more information on our philosophy regarding the recruitment and diversity of Board members and our Board refreshment policies, please see pages 26-27.

LOGO

Auditors(Proposal 2)

 

 

We are asking our stockholders to ratify the selection of KPMG LLP as our independent registered public accountants for fiscal 2019.2020. Although stockholder ratification of the appointment is not required, the Audit Committee believes it is appropriate to seek such ratification. Additional information is provided onpages 29-31.33-34.

2018

2019 Auditor Fees

  

Audit Fees

  

$1,185,987  

1,118,963  

  Qdoba Audit Fees (1)

 

305,000  

  Tax or Other Fees

$              0  

  Securitization Related Audit Fees

$   265,000  

  KPMG Total Fees

$1,383,963  


 

6    JACK IN THE BOX INC.ï  2020 PROXY STATEMENT

 

 

12,314  

  KPMG Total Fees

$1,503,301  

(1)

Qdoba Audit Fees are described in the “Independent Registered Public Accountants Fees and Services” section.  PROXY SUMMARY  

 

Executive Compensation(Proposal 3)

 

The Company seeks anon-binding advisory vote from its stockholders to approve the compensation of our NEOs for fiscal 20182019 (“Say on Pay”). The Board values stockholders’ opinions, and the Compensation Committee will take into account the outcome of the advisory vote when considering future executive compensation decisions.

 

Our CD&A, starting at page 37, describes the compensation decision-making process, details our programs and policies, and includes an illustration of ourcompensation framework and key fiscal 20182019 performance measures and pay actions on page 34.actions.

 

Our executivecompensation programs are built on the following principles and objectives:

 

Competitive target pay structure, including base salary, annual incentive, and long-term incentives that enable us to attract and retain talented, experienced executives who can deliver successful business performance and drive long-termlong- term stockholder value.

 

Pay for performance alignment, with the largest proportion of executive pay in the form of annual and long-term incentives that directly tie payouts, if any, to the achievement of corporate goals and strategies.

 

Comprehensive goal setting, with financial, operating,operational, and strategic performance metrics that drive long-term stockholder value.

 

Executive alignment with stockholders, through stock ownership and holding requirements that build and maintain an executive’s equity investment in the company.

Incentivizing balanced short-short-term and long-term executive decision-making, through variable compensation components (cash and stock) using varying timeframes.

 

Sound governance practices and principles in plan design and pay decisions, with the Compensation Committee considering both what and how performance is achieved.

 

Management of compensation risk, by establishing incentive goals that avoid placing too much emphasis on any one metric or performance time horizon, thereby discouraging excessive or unwise risk-taking.

 

 

Our stockholders approved each of the prior five years’ Say on Pay proposals by over 96%98% of votes cast.



 

6JACK IN THE BOX INC.  ï  2020 PROXY STATEMENT7

  PROXY SUMMARY  

Compensation Governance Practices

The company has several governance practices that we believe support the soundness and efficacy of our compensation programs. In short:

LOGO What We Do

LOGO

Compensation Committee composed entirely of independent directors, who meet regularly in executive session without Management present.Pages 25, 46.

LOGO

Independent compensation consultant who works exclusively for the Compensation Committee (no other work for the Company).Page 46.

LOGO

Robust stock ownership and holding requirements.Page 52.

LOGO

Compensation Risk Committee that analyzes compensation plans, programs, policies and practices.Page 58.

LOGO

Compensation Committee discretion to reduce payouts under incentive plans.Page 58.

LOGO

Clawback policy providing ability to recover incentive cash compensation and performance-based equity awards based on financial results that were subsequently restated due to fraud or intentional misconduct.Page 58.

LOGO

What We Don’t Do

☒

Section 16 officers and directors are prohibited from hedging, pledging or holding Company stock in margin accounts.Pages 53, 58.

☒

No dividends or dividend equivalents are paid on unvested restricted stock units (RSUs) or performance shares.Page 44.

☒

Nore-pricing of equity is permitted without stockholder approval.Page 36.

☒

The Company does not provide taxgross-ups except related to qualified relocation expenses (which require Compensation Committee approval in the case of executive officers).Page 48.

☒

From 2014 through the end of fiscal 2019, no RSUs or options awards provide for vesting upon a change in control without a “double trigger” (termination and consummation of the change in control) unless the award is not assumed or substituted for by the acquirer.Page 65-66.

Additional Information

Please see the “Questions and Answers” section that immediately follows for important information about the proxy materials, voting, the annual meeting, Company documents, communications and the deadlines to submit stockholder proposals for the 2021 Annual Meeting of Stockholders.



8    JACK IN THE BOX INC.ï  2020 PROXY STATEMENT

    

 

  PROXY SUMMARY  

Compensation Governance Practices

The company has several governance practices that we believe support the soundness and efficacy of our compensation programs. In short:

  LOGO What We Do

☒What We Don’t Do

✓ Compensation Committee composed entirely of independent directors, who meet regularly in executive session without Management present. Pages 23, 43.

☒Section  16 officers and directors are prohibited from hedging, pledging or holding Company stock in margin accounts.Page 50.

✓ Independent compensation consultant who works exclusively for the Compensation Committee (no other work for the Company). Page 43.

☒No dividends or dividend equivalents are paid on unvested restricted stock units (RSUs) or performance shares. Page 41.

✓ Robust stock ownership and holding requirements. Page 49.

☒Nore-pricing of equity without stockholder approval.Page 33.

✓ Compensation Risk Committee that analyzes compensation plans, programs, policies and practices.Page 56.

☒The Company does not provide taxgross-ups except related to qualified relocation expenses (which require Compensation Committee approval in the case of executive officers).Page 41.

✓ Compensation Committee discretion to reduce payouts under incentive plans. Page 56.

☒No guaranteed single trigger change in control accelerated vesting of RSUs and options. Since 2014, all RSUs and options awards that provide for vesting upon a change in control require a “double trigger” (termination and consummation of the change in control) unless the award is not assumed or substituted for by the acquirer.Page 63-64.

✓ Clawback policy providing ability to recover incentive cash compensation and performance-based equity awards based on financial results that were subsequently restated due to fraud or intentional misconduct. Page 56.

Additional Information

Please see the “Questions and Answers” section that immediately follows for important information about the proxy materials, voting, the annual meeting, Company documents, communications and the deadlines to submit stockholder proposals for the 2020 Annual Meeting of Stockholders.



JACK IN THE BOX INC.ï  2019 PROXY STATEMENT7

QUESTIONS AND ANSWERS  

 

JACK IN THE BOX INC.

9330 Balboa Avenue

San Diego, California 92123

PROXY STATEMENT

ANNUAL MEETING OF STOCKHOLDERS

March  1, 2019February 28, 2020

QUESTIONS AND ANSWERS

Proxy Materials and Voting Information

 

1.

Why am I receiving these materials?

 

 

We sent you these proxy materials because the Board of Directors (sometimes referred to as the “Board”) of Jack in the Box Inc. (sometimes referred to as the “Company,” “Jack in the Box,” “we,” “us,” or “our”) is soliciting your proxy to vote at the 20192020 Annual Meeting of Stockholders (the “Annual Meeting”) and at any postponements or adjournments of the Annual Meeting. The Annual Meeting will be held on March 1, 2019,February 28, 2020, at 8:30 a.m. Pacific Standard Time at our corporate headquarters located at 9330 Balboa Avenue, San Diego, CA 92123. If you held shares of our common stock on January 25,December 30, 2019 (the “Record Date”), you are invited to attend the Annual Meeting and vote on the proposals

described below under the heading “What are my voting choices for each of the items to be voted on at the 20192020 Annual Meeting?” However, you do not need to attend the Annual Meeting to vote your shares. Instead, you may complete, sign, date, and return the enclosed proxy card. You may also vote over the Internet or by telephone.

The Notice of Annual Meeting of Stockholders (the “Notice”), Proxy Statement, the enclosed proxy card, and our Annual Report on FormForm 10-K for the fiscal year ended September 30, 2018,29, 2019, will be mailed to stockholders on or about January 28, 2019.27, 2020.

 

 

2.

Who can vote at the Annual Meeting?

 

 

If you were a holder of Jack in the Box common stock (the “Common Stock”) either as astockholder of recordor as thebeneficial owner of shares held in Street nameas of the close of business on January 25,December 30, 2019, the Record Date for the Annual Meeting, you may vote your shares at the Annual Meeting. As of the Record Date, there were approximately

25,806,80423,088,516 shares of Common Stock outstanding, excluding treasury shares. Company treasury shares will not be voted. Each stockholder has one vote for each share of Common Stock held as of the Record Date. As summarized below, there are some distinctions between shares held of record and those owned beneficially in Street name.

 

 

3.

What does it mean to be a “stockholder of record”?

 

 

If, on the Record Date, your shares were registered directly in your name with the Company’s transfer agent, Computershare, then you are a “stockholder of record.” As a stockholder of record, you may vote in person at the Annual

Meeting or vote by proxy. Whether or not you plan to attend the Annual Meeting, we urge you to fill out and return the enclosed proxy card, or vote by telephone or Internet, to ensure your vote is counted.

 

 

4.

What does it mean to beneficially own shares in “Street name”?

 

 

If, on the Record Date, your shares were held in an account at a broker, bank, or other financial institution (we will refer to

those organizations collectively as “broker”), then you are the beneficial owner of shares held in “Street name” and these

JACK IN THE BOX INC.ï  2020 PROXY STATEMENT9

  QUESTIONS AND ANSWERS  

proxy materials are being forwarded to you by that broker. The broker holding your account is considered the stockholder of record for purposes of voting at the Annual Meeting. As the beneficial owner, you have the right to direct your broker on

8    JACK IN THE BOX INC.ï   2019 PROXY STATEMENT

  QUESTIONS AND ANSWERS  

how to vote the shares in your account. As a beneficial owner, you are invited to attend the Annual Meeting. However, since you are not a stockholder of record, you may not vote your shares in person at the Annual Meeting unless you request and obtain a valid legal proxy from your broker giving you the legal right to vote the shares at the Annual Meeting, as well as

satisfy the Annual Meeting admission criteria set out in the Notice. Under the rules that govern brokers, your broker is

not permitted to vote on your behalf on any matter to be considered at the Annual Meeting (other than the ratification of the appointment of KPMG LLP as our independent registered public accountants for fiscal 2019)2020) unless you provide specific instructions to the broker as to how to vote. As a result, we encourage you to communicate your voting decisions to your broker before the date of the Annual Meeting to ensure that your vote will be counted.

 

 

5.

What are my voting choices for each of the items to be voted on at the 20192020 Annual Meeting?

 

 

Item 1: Election of Directors   

•  Vote in favor of all nominees;

 

•  Vote in favor of specific nominees;

 

•  Vote against all nominees;

 

•  Vote against specific nominees;

 

•  Abstain from voting with respect to nominees; or

 

•  Abstain from voting with respect to specific nominees.

 

The Board recommends a voteFOR all Director nominees.

   
Item 2: Ratification of the Appointment of KPMG LLP as Independent Registered Public Accountants   

•  Vote in favor of ratification;

 

•  Vote against the ratification; or

 

•  Abstain from voting on the ratification.

 

The Board recommends a voteFOR the ratification.

   
Item 3: Advisory Vote to Approve Executive Compensation (“Say on Pay”)   

•  Vote in favor of the advisory proposal;

 

•  Vote against the advisory proposal; or

 

•  Abstain from voting on the advisory proposal.

 

The Board recommends a voteFOR the advisory approval of executive compensation.

 

6.

What if I return the proxy card to the Company but do not make specific choices?

 

If you return a signed, dated, proxy card to the Company without making any voting selections, the Company will vote your shares as follows:

 

“FOR” the election of all director nominees;

 

“FOR” the ratification of the appointment of KPMG LLP as our independent registered public accountants for the fiscal year ending September 29, 2019;27, 2020; and

“FOR,” on an advisory basis, approval of the compensation awarded to our named executive officers for the fiscal year ended September 30, 2018,29, 2019, as set forth in this Proxy Statement.

 

 

7.

Could any additional matters be raised at the 20192020 Annual Meeting?

 

 

We are not aware of any other matters to come before the Annual Meeting. If any matter not mentioned herein is properly brought before the Annual Meeting, the persons named in the

enclosed proxy will have discretionary authority to vote all proxies with respect thereto and in accordance with their best judgment.

 

 

10JACK IN THE BOX INC.  ï  20192020 PROXY STATEMENT9

  QUESTIONS AND ANSWERS  

    

  QUESTIONS AND ANSWERS  

 

 

8.

What does it mean if I received more than one proxy card?

 

 

If you receive more than one proxy card, your shares are registered in more than one name or are registered in different

accounts. Please complete, sign and return each proxy card to ensure that all of your shares are voted.

 

 

9.

How are votes counted?

 

 

Votes will be counted by the inspector of election appointed for the Annual Meeting, who will separately count “FOR,” “AGAINST,” abstentions and brokernon-votes. A “brokernon-vote” occurs when your broker submits a proxy for your shares of Common Stock held in Street name but does not vote on a particular proposal because the broker has not received voting instructions from you and does not have the authority to vote on that matter without instructions. Under the rules that govern brokers who are voting shares held in Street name, brokers have the discretion to vote those shares on routine matters but not onnon-routine matters.

For purposes of these rules, the only routine matter in this Proxy Statement is the ratification of the appointment of our independent registered public accountants. Therefore, if you hold your shares in Street name and do not provide voting instructions to your broker, your broker does not have discretion to vote your shares on any of the proposals at the Annual Meeting except the ratification of the appointment of independent registered public accountants. However, your shares will be considered present at the Annual Meeting for purposes of determining the existence of a quorum, as provided below.

 

 

Proposal  

Number

 Item   Votes Required for Approval Abstentions Uninstructed
Shares
      
1 

Election of 910 Directors

  

Majority of votes cast.

 No effect. No effect.
     
  
      
2 Ratification of the Appointment of KPMG LLP as Independent Registered Public Accountants  Majority of the voting power of the shares present in person or by proxy and entitled to vote on the proposal. 

Count as

votes against.

 Discretionary voting by broker permitted.
     
  
      
3 

Advisory Vote to Approve Executive Compensation

  Majority of the voting power of the shares present in person or by proxy and entitled to vote on the proposal. 

Count as

votes against.

 No effect.
     
      

 

10.

How many shares must be present or represented to conduct business at the Annual Meeting?

 

 

A quorum of stockholders is necessary to hold a valid annual meeting. A quorum will be present if the holders of at least a majority of the total number of shares of Common Stock entitled to vote are present, in person or by proxy, at the Annual Meeting. Abstentions and shares represented by

brokernon-votes are counted for the purpose of determining whether a quorum is present. If there are insufficient votes to constitute a quorum at the time of the Annual Meeting, we may adjourn the Annual Meeting to solicit additional proxies.

 

 

10JACK IN THE BOX INC.  ï  20192020 PROXY STATEMENT11

  QUESTIONS AND ANSWERS  

    

  QUESTIONS AND ANSWERS  

 

11.

How do I vote my shares of Jack in the Box Common Stock?

 

 

If you are a stockholder of record, you can vote in the following ways:

 

• 

By Internet:by following the Internet voting instructions included in the proxy card at any time up until 11:59 p.m., Eastern Time, on February 28, 2019.27, 2020.

 

• 

By Telephone:by following the telephone voting instructions included in the proxy card at any time up until 11:59 p.m., Eastern Time, on February 28, 2019.27, 2020.

 

• 

By Mail:if you have received a printed copy of the proxy materials from us by mail, you may vote by mail by marking, dating, and signing your proxy card in accordance with the instructions on it and returning it by mail in thepre-addressed reply envelope provided with the proxy materials. The proxy card must be received prior to the Annual Meeting.

 

• 

In Person:if you satisfy the admission requirements to the Annual Meeting, as described in the Notice, you may vote your shares in person at the meeting. Even if you plan to

 

attend the Annual Meeting, we encourage you to vote in advance by Internet, telephone or mail so that your vote will be counted in the event you later decide not to attend the Annual Meeting.

If you are a beneficial owner, you can vote in the following way:

If your shares are held in Street name or through a benefit or compensation plan, your broker or your plan trustee should give you instructions for voting your shares. In these cases, you may vote by Internet, telephone or mail, as instructed by your broker, trustee, or other agent. Shares beneficially held through a benefit or compensation plan cannot be voted in person at the Annual Meeting. You may vote your shares beneficially held through your broker in person if you satisfy the admission requirements to the Annual Meeting, as described in the Notice, and you obtain a valid legal proxy from your broker giving you the legal right to vote the shares at the Annual Meeting.

 

 

12.

May I change my vote or revoke my proxy?

 

Yes.

 

If you are a stockholder of record, you may change your vote or revoke your proxy by:

 

filing a written statement to that effect with our Corporate Secretary before the taking of the vote at the Annual Meeting;

 

voting again via the Internet or telephone but before the closing of those voting facilities at 11:59 p.m. Eastern Time on February 28, 2019;27, 2020;

 

attending the Annual Meeting, revoking your proxy and voting in person (attendance at the Annual Meeting, in and of itself, will not constitute a revocation of a proxy); or

 

timely submitting a properly signed proxy card with a later date that is received at or prior to the Annual Meeting.

The written statement or subsequent proxy should be delivered to Jack in the Box Inc., 9330 Balboa Avenue,9357 Spectrum Center Blvd., San Diego, CA 92123, Attention: Corporate Secretary, or hand delivered to the Corporate Secretary before the taking of the vote at the Annual Meeting.

If you are a beneficial owner and hold shares through a broker, bank, or other financial institution,you may submit new voting instructions by contacting your broker, bank, or other nominee. You may also change your vote or revoke your voting instructions in person at the Annual Meeting if you obtain a signed legal proxy from the broker, bank, or other nominee giving you the right to vote the shares.

 

 

12JACK IN THE BOX INC.  ï  20192020 PROXY STATEMENT11

  QUESTIONS AND ANSWERS  

    

  QUESTIONS AND ANSWERS  

 

13.

Who will pay for the cost of soliciting proxies?

 

 

The Company will pay the cost of preparing, printing, and mailing the Notice and the proxy materials. Copies of solicitation materials will be furnished to banks, brokerage houses, fiduciaries, and custodians holding shares of Common Stock beneficially owned by others, to forward to such beneficial owners. The Company may reimburse persons representing beneficial owners of Common Stock for their costs of forwarding solicitation materials to the beneficial owners. If you choose to access proxy materials or vote over the Internet or by telephone, you are responsible for Internet or

telephone charges. We have engaged Innisfree M&A Incorporated (“Innisfree”), a proxy-solicitation firm, to provide advice to the Company with respect to the 20192020 Annual Meeting of Stockholders and to assist us in the solicitation of proxies, for which the Company will pay a fee of $15,000 plus reimbursement of certainout-of-pocket expenses. In addition to solicitation by mail, proxies may be solicited personally, by telephone, or by Innisfree. They may also be solicited by directors, officers, or employees of the Company, who will receive no additional compensation for such activities.

 

 

14.

How can I find out the results of the Annual Meeting?

 

 

Preliminary voting results will be announced at the Annual Meeting. We will publish final results in a Current Report on FormForm 8-K that we expect to file with the Securities and Exchange Commission (“SEC”) within four business days of the Annual Meeting. After the FormForm 8-K is filed, you may

obtain a copy by visiting the SEC’s website atwww.sec.gov, visiting our website or contacting our Investor Relations Department by writing to Investor Relations Department, Jack in the Box Inc., 9330 Balboa Avenue, San Diego, CA 92123, or by sending an email toinvestor.relations@jackinthebox.com.

 

 

15.

How can I obtain copies of the proxy statement or10-K?

 

 

A copy of this Proxy Statement and the Company’s Annual Report on FormForm 10-K (“Form10-K”) for the fiscal year ended September 30, 2018,29, 2019, are available free of charge on our website. These filings and all of our filings that are made electronically with the SEC, including FormsForms 10-K,10-Q and8-K may be found athttp://investors.jackinthebox.com. Form10-K, excluding exhibits, may also be obtained by stockholders without charge by written request sent to Investor Relations Department, Jack in the Box Inc., 9330 Balboa Avenue,9357 Spectrum Center Blvd., San Diego, CA 92123.

As permitted by SEC rules, if your stock is held by a brokerage firm or bank, a single copy of this Proxy Statement may be delivered to an address shared by two or more stockholders. If you prefer to receive separate copies of a Proxy Statement and/or Annual Report either now or in the future, please contact your brokerage or bank. The voting instruction sent to a Street-name stockholder should provide information on how to request (i) householding of future Company materials or (ii) separate materials if only one set of documents is being sent to a household.

 

 

Annual Meeting Information

 

16.

How do I attend the 20192020 Annual Meeting of Stockholders in person?

 

 

IMPORTANT NOTE: If you plan to attend the Annual Meeting, you must follow these instructions to gain admission.

All attendees will need to present proof of ownership of Jack in the Box Inc. Common Stock and a valid pictureidentification, such as a driver’s license or passport. If you do not have both proof of ownership of Jack in the Box Inc. stock and a valid picture identification, you may be denied admission to the Annual Meeting.

Beneficial owners:If you are a beneficial owner, you will need to bring the notice or voting instruction form you received from your bank, broker or other nominee to be admitted to the meeting. You also may bring your bank or brokerage account statement reflecting your ownership of Common Stock as of January 25,December 30, 2019.

Attendance at the meeting is limited to stockholders as of the Record Date (January 25,(December 30, 2019) or their authorized named representatives. Cameras, sound or video recording devices, and large bags or packages will not be allowed in the meeting room.

 

 

12JACK IN THE BOX INC.  ï  20192020 PROXY STATEMENT13

  QUESTIONS AND ANSWERS  

    

  QUESTIONS AND ANSWERS  

 

Communications and Stockholder Proposals

 

17.

How can I communicate with the Company’s Directors?

 

 

The Board is committed to continuing to engage with stockholders and encourages an open dialogue about compensation, governance and other matters. We value your input, your investment and your support. The Board has established a process to facilitate communication by stockholders with Directors.

Stockholders or others who wish to communicate any concern of any nature to the Board of Directors, any Committee of the Board, or any individual director or group of directors, may write to a director or directors in care of the Office of the Corporate Secretary, Jack in the Box Inc., 9330 Balboa Avenue,9357 Spectrum Center Blvd., San Diego, CA 92123, or telephone888-613-5225. Your letter should indicate whether or not you are a stockholder of the Company.

Comments or questions regarding our accounting, internal controls or auditing matters will be referred to members of our

Audit Committee. Comments or questions regarding the nomination of directors and other corporate governance matters will be referred to members of the Nominating and Governance Committee. For all other matters, our Corporate Secretary will, depending on the subject matter:

 

forward the communication to the director or directors to whom it is addressed;

 

forward the communication to the appropriate management personnel;

 

attempt to handle the inquiry directly, for example where it is a request for information about our Company, or it is a stock-related matter; or

 

not forward the communication if it is primarily commercial in nature or if it relates to an improper or irrelevant topic.

 

 

18.

How do I submit a proposal for action at the 20202021 Annual Meeting?

 

 

A proposal for action to be presented by any stockholder at the 20202021 Annual Meeting of Stockholders will be acted upon only:

 

If a proposal is to be included in the proxy statement, pursuant to RuleRule 14a-8 under the Securities Exchange Act of 1934, as amended, the proposal is received by the Corporate Secretary no later than 120 calendar days prior to the anniversary of this year’s mailing date, so no later than 5:00 p.m. Pacific Time, on September 30, 2019.29, 2020.

 

If the proposal is not to be included in the proxy statement, the proposal is delivered to the Corporate Secretary not less than 120 days and not more than 150 days prior to the first anniversary of the date of the previous year’s Annual Meeting, or not later than November 2, 2019,October 31, 2020, and not earlier than October 3, 2019;1, 2020; in addition, such proposal is, under

  

is, under Delaware General Corporation Law, an appropriate subject for stockholder action; and must also comply with the procedures and requirements set forth in as well as the applicable requirements of our Bylaws.

In addition, the stockholder proponent, or a representative who is qualified under state law, must appear in person at the 20202021 Annual Meeting of Stockholders to present such proposal.

All proposals must be in writing and should be sent to Jack in the Box Inc., to the attention of Phillip H. Rudolph, Corporate Secretary, at 9330 Balboa Avenue,9357 Spectrum Center Blvd., San Diego, CA 92123.

A copy of the Bylaws may be obtained by written request to the Corporate Secretary at the same address. The Bylaws are also available athttp://investors.jackinthebox.cominvestors.jackinthebox.com.

 

 

14JACK IN THE BOX INC.  ï  20192020 PROXY STATEMENT13

 

  PROPOSAL ONE — ELECTION OF DIRECTORS  

 

PROPOSAL ONE — ELECTION OF DIRECTORS

All of the directors of the Company are elected annually and serve until the next Annual Meeting and until their respective successors are elected and qualified. The current nominees for election as directors (each of whom is currently serving as a Director of the Company) are set forth below. All of the nominees have indicated their willingness to serve and have consented to be named in the Proxy Statement. If any should be unable or unwilling to stand for election, the shares represented by proxies may be voted for a substitute designated by the Board, unless a contrary instruction is indicated in the proxy.

Nominees for Director

 

The following table provides certain information about each nominee for director as of January 1, 2019.2020(1).

 

Name

    

Age

 

     

Position(s) with the Company

 

    

Director

Since

 

     

Age

 

     

Position(s) with the Company

 

    

Director

Since

 

 

Leonard A. Comma

     

 

49

 

 

 

    

Chairman of the Board & Chief Executive Officer

 

     

 

2014

 

 

 

     

 

50

 

 

 

    

Chairman of the Board & Chief Executive Officer

 

     

 

2014

 

 

 

David L. Goebel

     

 

68

 

 

 

    

Independent Director

 

     

 

2008

 

 

 

     

 

69

 

 

 

    

Independent Lead Director

 

     

 

2008

 

 

 

Jean M. Birch

     

 

60

 

 

 

    

Independent Director

 

     

 

2019

 

 

 

John P. Gainor

     

 

63

 

 

 

    

Independent Director

 

     

 

2019

 

 

 

Sharon P. John

     

 

54

 

 

 

    

Independent Director

 

     

 

2014

 

 

 

     

 

55

 

 

 

    

Independent Director

 

     

 

2014

 

 

 

Madeleine A. Kleiner

     

 

67

 

 

 

    

Independent Director

 

     

 

2011

 

 

 

     

 

68

 

 

 

    

Independent Director

 

     

 

2011

 

 

 

Michael W. Murphy

     

 

61

 

 

 

    

Independent Director

 

     

 

2002

 

 

 

     

 

62

 

 

 

    

Independent Director

 

     

 

2002

 

 

 

James M. Myers

     

 

61

 

 

 

    

Independent Director

 

     

 

2010

 

 

 

     

 

62

 

 

 

    

Independent Director

 

     

 

2010

 

 

 

David M. Tehle

     

 

62

 

 

 

    

Independent Director

 

     

 

2004

 

 

 

     

 

63

 

 

 

    

Independent Director

 

     

 

2004

 

 

 

John T. Wyatt

     

 

63

 

 

 

    

Independent Director

 

     

 

2010

 

 

 

Vivien M. Yeung

     

 

46

 

 

 

    

Independent Director

 

     

 

2017

 

 

 

     

 

 

47

 

 

 

 

 

    

Independent Director

 

     

 

2017

 

 

 

Vote Required for Approval

In the election of directors, you may vote FOR, AGAINST, or ABSTAIN. The Company’s Bylaws require that, in an election such as this, where the number of director nominees does not exceed the number of directors to be elected, each director will be elected by the vote of the majority of the votes cast (in person or by proxy) with respect to the director. A “majority of votes cast” means that the number of shares cast “FOR” a director’s election exceeds the number of votes cast “AGAINST” that director. For purposes of determining the votes cast, only those votes cast “FOR” or “AGAINST” are included. Neither a vote to ABSTAIN nor a brokernon-vote will count as a vote cast FOR or AGAINST a director nominee and, as a result, will have no direct effect on the outcome of the election of directors. Abstentions and brokernon-votes will be counted for the purpose of determining whether a quorum is present.

In an uncontested election, a nominee who does not receive a majority of the votes cast will not be elected. An incumbent director who is not elected because he or she does not receive a majority of the votes cast will continue to serve but shall tender his or her resignation to the Board. The Nominating and Governance Committee will take action to determine whether to accept or reject the director’s resignation, or whether other action is appropriate, and will make a recommendation to the Board. Within ninety (90) days following the date of the certification of the election results, the Board will act on the Committee’s recommendation and publicly disclose its decision and the rationale for such decision.

ON PROPOSAL ONE, ELECTION OF DIRECTORS, THE BOARD OF DIRECTORS RECOMMENDS A VOTE “FOR” ALL NOMINEES.

 

(1)

Director John T. Wyatt, the current Compensation Committee Chair, will not be standingfor re-election at the Annual Meeting and will be departing as a Director immediately following the Meeting. Mr. Wyatt’s departure is in no way due to any disagreement with the Company nor is it the result of a removal “for cause.” Prior to the Annual Meeting, it is anticipated that the Board will elect to reduce the number of Board seats from eleven to ten. Following the Annual Meeting it is expected that the Company will have no open Director seats.

14JACK IN THE BOX INC.  ï  20192020 PROXY STATEMENT15

 

  PROPOSAL ONE — ELECTION OF DIRECTORS  

 

Director Qualifications and Biographical Information

 

Our Board includes individuals with expertise in executive leadership and management, accounting and finance, marketing and branding, and across restaurant, franchise, hospitality, retail, manufacturing, and healthcare industries. Our Directors have a diversity of backgrounds and experiences. We believe that, as a group, they work effectively together in overseeing our business, hold themselves to the highest standards of integrity, and are committed to representing the long-term best interests of our stockholders.

Biographical information for each of the Director nominees, including the key qualifications, experience, attributes, and skills that led our Board to the conclusion that each of the Director nominees should serve as a director, is set forth on the pages below. In addition to the business and professional experiences described below, our Director nominees also serve on the boards of various civic and charitable organizations.

Director Nominees

LOGO

    

Leonard A. Comma

 

Director Since January 2014

Mr. Comma was appointed a Director, Chairman of the Board and Chief Executive Officer, effective January 1, 2014, and since that date has served as a member of the Executive Committee. From May 2012 until October 2014, Mr. Comma served as President, and from November 2010 to January 1, 2014, as Chief Operating Officer of Jack in the Box Inc. Mr. Comma joined the Company in 2001 as Director of Convenience Store & Fuel Operations for the Company’s proprietary chain of Quick Stuff convenience stores, which included more than 60 locations at the time it was sold in 2009. In 2004, he was promoted to Division Vice President of Quick Stuff Operations, and in 2006 he was promoted to Regional Vice President of Quick Stuff and the Company’s Southern California region, which included more than 150 Jack in the Box restaurants. In 2007, Mr. Comma was promoted to Vice President of Operations, Division II, and had oversight of nearly 1,200 company and franchised Jack in the Box restaurants in the Western U.S. Prior to joining Jack in the Box Inc., Mr. Comma worked for ExxonMobil Corporation since 1989, with his last position as a Regional Manager with responsibility for supporting more than 300 franchisees.

Qualifications:

 

Mr. Comma has more than 25 years of experience at two major public companies with extensive retail and franchise operations, including for the past five years as Chairman and CEO of Jack in the Box Inc. In his prior executive-level role as President and Chief Operating Officer for Jack in the Box Inc., Mr. Comma was responsible for the operations of all Company and franchised Jack in the Box restaurants — more than 2,200 locations — as well as: Menu Innovation, including Menu Strategy, Operations Support, and Research & Development; Marketing Communications, including Merchandising; Consumer Intelligence & Analytics; and Internal Brand Communications. Mr. Comma also gained extensive experience in restaurant and retail operations and franchising in his previous roles with the Company as well as with ExxonMobil. His professional expertise and knowledge of our business, our competition and our competitive positioning, along with his deep understanding of our values and culture, bring an important Company perspective to the Board.

 

 

16JACK IN THE BOX INC.  ï  20192020 PROXY STATEMENT15

 

  PROPOSAL ONE — ELECTION OF DIRECTORS  

 

LOGO

    

David L. Goebel

 

Lead Director;

Director Since December 2008

Mr. Goebel has been a director of the Company since December 2008, and currently serves as Lead Director. He is a partner and Faculty Member for Merryck & Co. Ltd., a worldwide firm that provides peer to peer mentoring services for CEOs and senior business executives. He has held that position since May 2008. In 2008, Mr. Goebel became the founding principal and President of Santoku, Inc., a private company that operates a fast-casual pizza concept under the name Pie Five® Pizza Company. Mr. Goebel also served as acting President and CEO of Mr. Goodcents Franchise Systems, Inc. from 2010 until December 2014. From 2001 until 2007, he served in various executive positions at Applebee’s International, Inc., including as President and Chief Executive Officer in 2006-2007, during which time the company operated nearly 2,000 restaurants in the United States and internationally. Previous to that, Mr. Goebel was President of Summit Management, Inc., a consulting group specializing in executive development and strategic planning. Prior to that, he was the Chief Operating Officer of Finest Foodservice, LLC, a Boston Chicken/Boston Market franchise that he founded andco-owned, which was responsible for developing 80 restaurants within a seven-state area from 1994 until 1998. Since 2017, Mr. Goebel has served on the board of directors of Wingstop Inc. which operates and franchises more than 1,000 fast-casual restaurant locations across the United States and internationally. He served on Wingstop’s Audit Committee until August 2018.

Qualifications:

 

Mr. Goebel has more than 40 years of experience in the retail, food service, and hospitality industries. Mr. Goebel’s qualifications to serve on our Board include: his business, operational, management, and leadership development experience in the retail, food service, and hospitality industries; his work as an executive consultant; his relevant industry experience, including his experience in restaurant operations, restaurant and concept development, supply chain management, franchising, executive development, risk assessment, risk management, succession planning, executive compensation and strategic planning; and his service on other private and public boards.

LOGO

Jean M. Birch

Director Since May 2019

Ms. Birch has been a director of the Company since May 2019. She served as a member of the Board of Papa Murphy’s Holdings, Inc., a franchisor and operator of the largest Take ‘n’ Bake pizza chain in the U.S., from April 2015 until May 2019, and served as Chair of the Board of Papa Murphy’s from September 2016 until May 23, 2019, when the company was sold to MTY Food Group. Ms. Birch was appointed President and CEO of Papa Murphy’s in December 2016 and served in that position until July 2017. From 2009 to 2012, Ms. Birch was President of IHOP Restaurants, Inc., a division of DineEquity, Inc. Prior to that, Ms. Birch was President of Romano’s Macaroni Grill from January 2005 to August 2007 and President of Corner Bakery Café from August 2003 to December 2004, both divisions of Brinker International, Inc. From 1991 to 2003, Ms. Birch held various roles with YUM! Brands, Inc., a global quick-service restaurant company, including VP, Operations for Taco Bell, Inc. and Senior Director, Concept Development for Pizza Hut, Inc. Since 2007, Ms. Birch has also served as CEO and President of her own strategy and leadership consulting practice, Birch Company, LLC. Since February 2018, she’s been a director of Forrester Research, a global research and advisory firm, where she currently serves as Chair of that board’s Audit Committee. In addition, since September 2018, Ms. Birch has been a director of CorePoint Lodging Inc., a real estate investment trust, where she currently serves on that board’s Audit Committee.

Qualifications:

Ms. Birch’s qualifications to serve on our Board include her extensive operational experience as an executive officer across multiple national restaurant chains. She brings more than 20 years of experience leading major business affairs at national restaurants, including experience related to strategy and business development, franchising, marketing and brand building, product development, supply chain, finance and capital markets, labor relations, human resources and compensation, organizational development and succession planning. She has public company board experience currently serving as a director of CorePoint Lodging and Forrester Research in addition to previously serving as Chair of Papa Murphy’s Holdings.

JACK IN THE BOX INC.ï  2020 PROXY STATEMENT17

  PROPOSAL ONE — ELECTION OF DIRECTORS  

LOGO

John P. Gainor

Director Since May 2019

Mr. Gainor has been a director of the Company since May 2019. He served as the President and CEO of International Dairy Queen, a subsidiary of Berkshire Hathaway, from 2008 until his retirement in 2017. Mr. Gainor was with International Dairy Queen starting in 2003 and served as its Chief Supply Chain Officer prior to being named President and CEO. From 2000 to 2003, Mr. Gainor was President andCo-Founder of Supply Solutions, Inc., a company that focused on designing and implementing supply chain solutions and business expansion models for major restaurant chains and consumer products companies. Mr. Gainor has also held various executive positions focusing on logistics, supply chain and transportation with Consolidated Distribution Corporation, ProSource Inc., AmeriServe Distribution Corporation, and Warner Lambert Corporation. He currently serves as a director on the board of Saia, Inc. — a leading regional and inter-regional less-than-truckload carrier that services 43 states, Canada, Mexico and Puerto Rico. He serves on the company’s Audit Committee. He is a National Association of Corporate Directors (NACD) Board Leadership Fellow.

Qualifications:

Mr. Gainor has more than 40 years of experience in foodservice and consumer product industries including over 9 years serving as President and CEO of a leading global fast-food restaurant chain, International Dairy Queen. He has extensive experience working directly with franchisees. He brings significant experience in franchising, product development, brand building, logistics, supply chain, transportation and business expansion to our Board based on his executive roles at well-known restaurant and consumer product companies. In addition to his vast operational experience, Mr. Gainor brings additional public company board experience to our Board.

 

LOGO

    

Sharon P. John

 

Director Since September 2014

Ms. John has been a director of the Company since September 2014. Ms. John has been the Chief Executive Officer, President and a member of the Board of Directors ofBuild-A-Bear Workshop, Inc. since June 2013. From January 2010 through May 2013, Ms. John served as President of Stride Rite Children’s Group LLC, a division of Wolverine Worldwide, Inc., a global designer, manufacturer and marketer of footwear and apparel. From 2002 through 2009, she held positions of broadened portfolio and increased responsibility at Hasbro, Inc., a multinational toy and board game company, including as General Manager & Senior Vice President of its U.S. Toy Division from 2006 to 2008 and General Manager & Senior Vice President of its Global Preschool unit from June 2008 through 2009. Ms. John also founded and served as Chief Executive Officer of Checkerboard Toys; served as Vice President, U.S. Toy Division with VTech Industries, Inc.; and served in a range of roles at Mattel, Inc. She started her career in the advertising industry.

Qualifications:

 

Ms. John’s qualifications to serve on our Board include her current role as CEO and director of a publicly traded global retail company and her broad merchandising, marketing, branding, sales and executive management experience, including key roles at well-known consumer brands.

 

 

1618    JACK IN THE BOX INC.  ï  20192020 PROXY STATEMENT

    

 

  PROPOSAL ONE — ELECTION OF DIRECTORS  

 

LOGO

    

Madeleine A. Kleiner

 

Director Since September 2011

Ms. Kleiner has been a director of the Company since September 2011 and is currently Chair of the Nominating and Governance Committee. From 2001 to 2008, Ms. Kleiner was Executive Vice President, General Counsel and Corporate Secretary for Hilton Hotels Corporation, a hotel and resort company. At Hilton, Ms. Kleiner oversaw the company’s legal affairs and the ethics, privacy and government affairs functions. She was also a member of the executive committee with significant responsibility for board of directors matters. From 1999 through 2001, Ms. Kleiner served as a director of a number of Merrill Lynch mutual funds operating under the Hotchkiss and Wiley name. From 1995 to 1998, Ms. Kleiner served as Senior Executive Vice President, Chief Administrative Officer and General Counsel of H. F. Ahmanson & Company and its subsidiary, Home Savings of America, where she was responsible for oversight of legal, human resources, legislative and government affairs and corporate communications. Previous to that, from 1977 to 1995, Ms. Kleiner was with the law firm of Gibson, Dunn & Crutcher, including as partner from 1983 to 1995, where she advised corporations and their boards primarily in the areas of mergers and acquisitions, corporate governance, securities transactions and compliance. Ms. Kleiner has served on the board of directors of Northrop Grumman Corporation since 2008, where she is a member of the audit committee.Audit Committee.

Qualifications:

 

Ms. Kleiner’s qualifications to serve on our Board include her experience as general counsel for two public companies, as outside counsel to numerous public companies and her past and current experience on public company boards. She brings to our Board experience as an executive for a major franchisor in the hospitality industry, as well as expertise in corporate governance, risk management, securities laws disclosure, securities transactions, mergers and acquisitions, Sarbanes-OxleySarbanes- Oxley compliance, human resources and executive compensation, government relations and crisis management.

 

LOGO

    

Michael W. Murphy

 

Director Since September 2002

Mr. Murphy has been a director of the Company since September 2002, and is currently Chair of the Audit Committee.2002. Mr. Murphy has beenserved as President and Chief Executive Officer of Sharp HealthCare sincefrom April 1996 until his retirement in February 2019, and aas member of the Sharp Board since 2007.from 2007 through his retirement. Sharp is a comprehensive healthcare delivery system which has been recognized with the Malcolm Baldrige National Quality Award, the nation’s highest Presidential honor for quality and organizational performance excellence. Mr. Murphy has announced his plans to retire from Sharp HealthCare effective February 28, 2019. Prior to his appointment to President and Chief Executive Officer, Mr. Murphy served as Senior Vice President of Business Development and Legal Affairs for Sharp HealthCare. He began his career at Sharp in 1991 as Chief Financial Officer of Grossmont Hospital before moving to a system-wide role as Vice President of Financial Accounting and Reporting. Prior to this, Mr. Murphy provided certified public accounting services, including as a partner at Deloitte.

Qualifications:

 

Mr. Murphy’s qualifications to serve on our Board include his business and management experience leading Sharp HealthCare, an integrated healthcare delivery system with multiple facilities and more than 18,000 employees, his experience as a senior financial officer of Sharp HealthCare, and his experience as a Certified Public Accountant, and former partner at Deloitte. He also serves on the Board of Directors and executive committee of the California Chamber of Commerce. The Board benefits from Mr. Murphy’s extensive experience in accounting, finance, financial reporting, auditing, governance, labor relations, human resources and compensation, marketing, risk assessment and risk management, strategic planning and quality initiatives.

 

 

JACK IN THE BOX INC.  ï  20192020 PROXY STATEMENT1719

 

  PROPOSAL ONE — ELECTION OF DIRECTORS  

    

 

 

LOGO

    

James M. Myers

 

Director Since December 2010

Mr. Myers has been a director of the Company since December 2010.2010 and is currently Chair of the Finance Committee. Mr. Myers served as Chairman of the Board of Petco, the national pet supplies retailer from July 2015 until September 2018 and was also Petco’s Chief Executive Officer from 2004 until February 2017. Previously, Mr. Myers held the following positions at Petco: President from 2011 until 2015; Chief Financial Officer from 1998 to 2004; and Vice President and Controller from 1990. Prior to that, Mr. Myers was a Certified Public Accountant with KPMG LLP. Mr. Myers served on the board of Provide Commerce, ane-commerce retailer and public company, from 2004 to 2006, when Provide Commerce was acquired. Mr. Myers served on the audit committee at Provide Commerce.

 

Qualifications:

 

Mr. Myers’ qualifications to serve on our Board include more than 35 years of financial and retail operations experience, including 10 years as a CPA and public company auditor with KPMG LLP and 25 years with Petco, a national specialty retail chain with more than 1,500 stores in all 50 states, Puerto Rico and Mexico. Mr. Myers brings to the Board his experience with marketing and consumer brands, human resources and compensation, mergers and acquisitions, capital markets, financial reporting, financial oversight, and the financial and strategic issues facing public and private companies, as well as prior experience of serving on a public company board and audit committee.

 

LOGO

    

David M. Tehle

 

Director Since December 2004

Mr. Tehle has been a director of the Company since December 2004 and is currently Chair of the FinanceAudit Committee. He served as Executive Vice President and Chief Financial Officer of Dollar General Corporation, a publicly traded company, from 2004 until his retirement in 2015. Prior to that, Mr. Tehle served from 1997 to 2004 as Executive Vice President and Chief Financial Officer of Haggar Corporation, a manufacturing, marketing, and retail corporation. From 1996 to 1997, he was Vice President of Finance for a division of The Stanley Works, one of the world’s largest manufacturer of tools, and from 1993 to 1996, he was Vice President and Chief Financial Officer of Hat Brands, Inc. Since February 2016, Mr. Tehle has served on the board of directors of Genesco, Inc., a specialty retailer, selling footwear, headwear, sports apparel and accessories, where he serves on the audit committee. from February 2016 through June 2019. Since July 2016, he has served on the board of US Foods Holding Corp., where he chairs the audit committee;Audit Committee; and since July 2017, on the Board of National Vision, Inc. where he also chairs the audit committee.Audit Committee.

Qualifications:

 

Mr. Tehle’s qualifications to serve on our Board include his lengthy experience in senior financial management at public companies in the retail and manufacturing industries, and his service on three other boards of public companies in the retail and food service sectors. As an active CFO through June 2015, he was responsible for the overall financial management of a large retail organization. Mr. Tehle has experience in the oversight of strategic planning, human resources and compensation, finance, accounting, information systems, investor relations, treasury and internal audit functions. He brings valuable financial expertise and retail and management experience to the Board.

 

 

1820    JACK IN THE BOX INC.  ï  20192020 PROXY STATEMENT

    

 

  PROPOSAL ONE — ELECTION OF DIRECTORS  

 

 

LOGO

Vivien M. Yeung

Director Since April 2017

Ms. Yeung has been a director of the Company since April 2017. Ms. Yeung is currently an independent consultant working with companies and non-profits on strategy development. From January 2018 until November 29, 2019 Ms. Yeung served as General Manager, Venture at Lululemon Athletica Inc, a healthy lifestyle inspired athletic apparel company. She previously served as that company’s Chief Strategy Officer from May 2015, to January 2018, and as Vice President, Strategy from November 2011 to May 2015. From 2008 until 2011, Ms. Yeung was an independent consultant working with philanthropies, non-profit organizations and small to medium-sized enterprises on strategy development. From 2002 to 2008, she held positions with increasing responsibilities at Starbucks Coffee Company, a global premium food and beverage retailer, leading strategy development and process improvement for its North America, International, and Global Product organizations. Ms. Yeung started her career with Bain & Company, a global strategy consulting firm, advising clients on growth, operational and investment strategies across Greater China, Southeast Asia and Australia.

Qualifications:

•

Ms. Yeung’s qualifications to serve on our Board include her current strategic consulting work and recent strategic roles at publicly traded global retail companies, as well as her broad background in strategy development across channel development, marketing, product management, international growth, pricing and new business development, including at Lululemon, Starbucks and as a consultant at Bain.

Current Director Not Standing for Re-Election

LOGO

John T. Wyatt

 

Director Since May 2010

Mr. Wyatt has been a director of the Company since May 2010, and is currently Chair of the Compensation Committee. Mr. Wyatt has served as the Chief Executive Officer of KinderCare Education, an early childhood education company, since February 2012, and on the company’s board since 2012. From 2008 through February 2012, Mr. Wyatt was president of the Old Navy division of Gap Inc. He joined Gap Inc. in 2006, and previously served as President of the company’s GapBody division, and President of the company’s Outlet division. From 2004 to 2006, Mr. Wyatt was President and Chief Executive Officer at Cutter & Buck Inc., a designer and marketer of upscale apparel, including serving on the publicly held company’s board of directors. From 2002 to 2004, he served as President of Warnaco Intimate Apparel, a global designer and manufacturer, and from 1999 to 2002, he was Executive Vice President for Strategic Planning and eBusiness Strategies in the Saks family of companies. Additionally, Mr. Wyatt spent more than 20 years with VF Corporation, serving ultimately as President of Vanity Fair Intimates and Vanity Fair Intimates Coalition.

Qualifications:

Mr. Wyatt’s qualifications to serveWyatt will not be standing for re-election at the Annual Meeting, as described at Note 1 on our Board include his experience in senior management for major consumer brands in large global retail companies, including strategypages 5 and business development, marketing and brand building, product development, supply chain, finance and capital markets, labor relations, human resources and compensation, organizational development and succession planning, and his prior public company board experience. He brings extensive experience in growing consumer brands to the Board.15.

 

LOGO

Vivien M. Yeung

 

Director Since April 2017

Ms. Yeung has been a director of the Company since April 2017. Ms. Yeung has served as General Manager, Venture at Lululemon Athletica Inc, a healthy lifestyle inspired athletic apparel company, since January 2018. She previously served as that company’s Chief Strategy Officer since May 2015, and as Vice President, Strategy from November 2011 to May 2015. From 2008 until 2011, Ms. Yeung was an independent consultant working with philanthropies,non-profit organizations and small to medium enterprises on strategy development. From 2002 to 2008, she held positions with increasing responsibilities at Starbucks Coffee Company, a global premium food and beverage retailer, leading strategy development and process improvement for its North America, International, and Global Product organizations. Ms. Yeung started her career with Bain & Company, a global strategy consulting firm, advising clients on growth, operational and investment strategies across Greater China, Southeast Asia and Australia.

Qualifications:

Ms. Yeung’s qualifications to serve on our Board include her current and recent strategic roles at a publicly traded global retail company, as well as her broad background in strategy development across channel development, marketing, product management, international growth, pricing and new business development, including at Starbucks and as a consultant at Bain.

 

JACK IN THE BOX INC.  ï  20192020 PROXY STATEMENT1921

 

  CORPORATE GOVERNANCE  

    

 

CORPORATE GOVERNANCE

We operate within a comprehensive corporate governance structure driving and expecting the highest standards of professional and personal conduct. Our Corporate Governance Principles and Practices, our ethics Code of Conduct: “The Integrity Playbook,” the charters for our Audit, Compensation, Finance, and Nominating and Governance Committees, and other corporate governance information, are available athttp://investors.jackinthebox.com. These materials are also available in print to any stockholder upon written request to the Company’s Corporate Secretary, Jack in the Box Inc., 9330 Balboa Avenue,9357 Spectrum Center Blvd., San Diego, CA 92123. The information on our website is not a part of this Proxy Statement and is not incorporated into any of our filings made with the Securities and Exchange Commission.

Directors’ Independence

 

 

The Jack in the Box Inc. Director Independence Guidelines provide that a director is not independent if he or she is: (a) a director, executive officer, partner or owner of 5% or greater interest in a company that either purchases from or makes sales to our Company that total more than one percent of the consolidated gross revenues of such company for that fiscal year; (b) a director, executive officer, partner or owner of 5% or greater interest in a company from which our Company borrows an amount equal to or greater than one percent of the consolidated assets of either our Company or such other company; or (c) a trustee, director or executive officer of a charitable organization that has received in that fiscal year discretionary donations from our Company that total more

than 1% of the organization’s latest publicly available national annual charitable receipts.

The Board has analyzed the independence of each Director. It has determined that all but Mr. Comma are independent directors under the NASDAQ Listing Rules, as well as the additional Director Independence Guidelines adopted by the Board. As part of its analysis, the Board determined that none of these Directors have a material relationship with the Company. Mr. Comma is our current Chief Executive Officer and an employee, and therefore he is not considered “independent” as that term is defined by the relevant listing rules and governance guidelines.

 

 

Board Meetings, Annual Meeting of Stockholders, and Attendance

 

 

In fiscal 2018,2019, each director attended more than 75% of the meetings of the Board and of the committees on which he or she served. The Board held eightten meetings in fiscal 2018.2019.

All ofWhile we do not have a formal attendance policy regarding attendance by our directors at our annual stockholder meetings, all the directors standing for election in 20192020 and who were Company directors at the time attended the 2018 Annual Meeting, and we currently expect all of our directors standing for election to be present at the 2019 Annual Meeting.

 

 

Determination of Current Board Leadership Structure

 

 

The Nominating and Governance Committee’s Charter provides that the Committee will annually assess the leadership structure of the Board and recommend a structure to the Board for approval. In November 2018,2019, the Board of Directors, with input from the Nominating and Governance Committee, conducted this assessment, including assessing whether (i) the roles of Chief Executive Officer (“CEO”) and Chairman of the Board should continue to be combined, and (ii) the Board should continue to have an independent Lead Director. Based on the recommendation of the Nominating and Governance Committee, the Board believes that continuing with a combined Chairman/CEO is in the best interests of the Company and its stockholders.

The Board determinedstockholders in that having one individual servesuch a structure at Jack in both rolesthe Box provides for clear leadership, accountability, and alignment on corporate strategy. TheSpecifically, the Board believes that combining the roles of

Chairman and CEO puts Mr. Comma in the best positionenables that leader to use hisin-depth or her knowledge ofand expertise regarding our industry our business and its challenges, and our stakeholders, including our stockholders, employees, franchisees and guests, to provide the Board with the information and leadership needed to set agendas and direction for the Company. The Board does not believe that having an independent Chairman would make the Board’s risk oversight processes more effective. The Board noted that, during the tenures of Mr. Comma’s tenureComma and Linda Lang, his predecessor as ChairmanChair and CEO and of Mr. Goebel’s service as Lead Director, the Board has received timely and relevant information regarding the Company’s business.business and has operated smoothly, efficiently, and appropriately in fulfilling its obligations to the company’s stockholders. As noted earlier, the Board assesses its leadership structure on a regular basis and would revisit the current structure should it deem a change in that structure appropriate.

 

 

2022    JACK IN THE BOX INC.  ï  20192020 PROXY STATEMENT

    

 

  CORPORATE GOVERNANCE  

 

In reaching its conclusion, the Board also considered the longstanding policies and practices at Jack in the Box Inc. for strong, independent oversight, including:

 

a Board with a high degree of independence, including only onenon-independent member;

 

Board Committees (other than the Executive Committee) that are composed entirely of independent directors;

 

Board Committee Chairs who review and approve agendas before Committee meetings;

 

an annual evaluation of the performance of the Chairman and Chief Executive Officer by the Compensation Committee, which evaluation is then discussed with the independent directors of the Board in executive session;

regular executive sessions held by the Board and key Board Committees, attended only by independent directors;

 

the ability of the independent directors to call meetings of the Board and recommend agenda topics to be considered by the Board; and

 

a strong, independent Lead Director who has oversight responsibility for executive sessions and information flow to the Board.

Based on these factors, the Board has concluded that retaining the current Board leadership structure provides valuable stability and effective leadership.

 

 

Lead Director

 

 

The independent directors have appointed Mr. Goebel to serve as Lead Director. Our Corporate Governance Principles and Practices provide for the Lead Director to fulfill the following functions:

 

set agendas for the executive sessions of the Board;

 

serve on the Executive Committee;

preside at the executive sessions of the independent directors held following each scheduled board meeting;

 

act as a key communication channel between the Board and the CEO;

lead the Board in determining the format and adequacy of information the directors receive;

provide the Chairman with input on agendas for Board meetings and the schedule of meetings in order to assure sufficient time for discussion of all agenda items;

 

call meetings of independent directors; and

 

if requested by major stockholders, ensure that he or she is available for consultation and direct communication.

The Lead Director may perform other functions as the Board may direct.

 

 

The Board’s Role in Risk Oversight

 

 

Management is responsible for the Company’sday-to-day risk management. The Board’s role is to provide oversight of the processes designed to identify, assess and monitor key risks and risk mitigation activities. The Board fulfills its risk oversight responsibilities through (i) quarterly reports from the Head of Internal Audit (Internal Audit Head) to the Audit Committee relating to risk management and oversight; (ii) annualongoing enterprise risk management discussions by the full Board with the Director of Internal Audit Head and Company leadership; (iii) receiving reports directly from managersemployees responsible for the management of particular business risks; and (iv) reports by each Committee Chair regarding the respective Committee’s oversight of specific risk topics.

The Board reviews cybersecurity risk with the Chief Information Officer regularly and has delegated oversight of

other specific risk areas to Committees of the Board. For example, the Audit Committee discusses with Management the Company’s major financial risk exposures and the steps Management has taken to monitor and mitigate those risks. As another example, the Compensation Committee discusses with its independent consultant, Management and the Compensation Risk Committee the risks arising in connection with the design of the Company’s compensation programs and succession planning. The risk oversight responsibility of each Board Committee is described in its committee charter available athttp://investors.jackinthebox.cominvestors.jackinthebox.com.

A more detailed discussion of the Compensation Committee’s oversight of compensation risk is found in the Section “Compensation Risk Analysis” contained later in this proxy.

 

 

JACK IN THE BOX INC.  ï  20192020 PROXY STATEMENT2123

 

  CORPORATE GOVERNANCE  

    

 

The Board’s Role in Succession Planning

 

 

The Board expects Management to have an ongoing program for effective senior leadership development and succession. As reflected in our Corporate Governance Principles and Practices, the Board’s practice is to have the CEO review annually with the full Board the abilities of the key senior managers and their likely successors. The Board also considers management succession issues when meeting in executive session at each Board meeting. Additionally, the

Board oversees ongoing plans for management development and retention, as well as executive succession, including CEO succession. At times, the Board will delegate to the Compensation Committee or, as it has recently done, to an Ad Hoc Succession Planning Committee of the Board, responsibility to review and advise on succession planning, in which case the Board expects the Committee to review such

plans with Management and the Board and to make recommendations to the Board with respect thereto.

As announced on December 11, 2019, the Board has retained an executive search consulting firm to assist the Company and the Ad Hoc Succession Planning Committee of the Board in identifying an individual to succeed its current Chairman and Chief Executive Officer, Lenny Comma. Although Mr. Comma has not set a specific date to leave the Company, he has informed the Board he believes it is an appropriate time for the Company to move forward with identifying a successor with whom Mr. Comma can work on a smooth and efficient transition of leadership. The Board’s search is expected to include both internal and external candidates.

 

 

Committees of the Board

 

 

The Board of Directors has fivefour standing committees: Audit, Compensation, Nominating and Governance, Finance, and Executive.Finance. The Board decided to disband the Executive Committee in fiscal year 2019. The Board considers new committee and chair assignments, and the designation of a Lead Director, effective each February. Effective February 2018,2019, the Board of Directors approved the Board Committee assignments for the year andre-designated David Goebel as the Lead Director. The current committee makeup is provided in the “Board Nominees” table in the Proxy Summary. In November 2018,2019, the Board approved updates to the Committee assignments which will take effect following the 20192020 annual meeting.

The authority and responsibility of each Committee is summarized below. A more detailed description of the functions of the Audit, Compensation, Nominating and Governance, and Finance Committees is included in each Committee charter available athttp://investors.jackinthebox.com.

Executive Committee.Audit Committee The Executive Committee is authorized to exercise all powers of the Board in the management of the business and affairs of the Company while the Board is not in session. The Executive Committee did not meet in fiscal 2018.

Audit Committee..As more fully described in its charter, the Audit Committee assists the Board of Directors with overseeing:

 

the integrity of the Company’s financial reports;

 

the Company’s compliance with legal and regulatory requirements;

 

the independent registered public accountant’s performance, qualifications and independence;

 

the performance of the Company’s internal auditors; and

 

the Company’s processes for identifying, evaluating, and addressing major financial, legal, regulatory compliance, and enterprise risks.

The Audit Committee has sole authority to select, evaluate, and, when appropriate, replace the Company’s independent registered public accountants. The Audit Committee has

appointed KPMG LLP (“KPMG”) as its independent registered public accountants for fiscal 20192020 and is asking the stockholders to ratify this appointment in Proposal 2. In the event the stockholders fail to ratify the appointment, the Audit Committee will reconsider the selection to determine, in its discretion, whether to retain KPMG or to select a different registered public accountant. Even if the selection is ratified, the Audit Committee in its discretion may direct the appointment of a different independent auditing firm at any time during the year.

The Audit Committee meets at least each quarter with KPMG, Management and the Company’s Internal Audit Head, to review the Company’s annual and interim consolidated financial results before the publication of quarterly earnings press releases and the filing of quarterly and annual reports with the Securities and Exchange Commission. The Audit Committee also meets at least each quarter in private sessions with KPMG, Management, and the Internal Audit Head. The Audit Committee also oversees the Company’s Business Ethics Program, which includes receiving a quarterly report from the Ethics Officer. The Board of Directors has determined that each member of the Audit Committee qualifies as an “audit committee financial expert” as defined by SEC rules.

The Audit Committee held sixfour meetings in fiscal 2018.2019. Additional information regarding the Audit Committee is set forth in the “Report of the Audit Committee” section of this proxy.

24    JACK IN THE BOX INC.ï  2020 PROXY STATEMENT

  CORPORATE GOVERNANCE  

Compensation Committee.Committee. As more fully described in its charter, the Compensation Committee assists the Board in discharging the Board’s responsibilities relating to Director and executive officer compensation, and it oversees the performance evaluation of Management. The Compensation Committee reviews and approves the Company’s compensation philosophy, and the compensation of executive officers, including short- and long-term goals, and metric and compensation components (e.g., cash, equity and other forms of compensation). The Compensation Committee discusses with Management and reports to the Board any significant risks associated with the design and administration

22    JACK IN THE BOX INC.ï   2019 PROXY STATEMENT

  CORPORATE GOVERNANCE  

of the Company’s compensation programs and succession planning, and actions taken by Management to mitigate such risks. The Committee has approved the disclosures in the Company’s “Compensation Discussion and Analysis” section of this Proxy Statement. The Compensation Committee held six meetings in fiscal 2018.2019.

Finance Committee.As more fully described in its charter, the Finance Committee assists the Board in advising and consulting with Management concerning financial matters of importance to the Company. Topics considered by the Committee include the Company’s capital structure, financing arrangements, stock repurchase programs, capital investment policies, investment performance oversight for the Company’s retirement plans, the budget process, and the financial implications of major acquisitions and divestitures. The Finance Committee discusses with Management and reports to the Board major risk exposures and the monitoring and mitigation activities undertaken by Management in connection with the matters overseen by the Committee, including proposed major transactions, capital structure, investment portfolio including employee benefit plan investments, financing arrangements, and share repurchase programs. The Finance Committee held sevensix meetings in fiscal 2018.2019.

Nominating and Governance Committee.As more fully described in its charter, the Nominating and Governance Committee duties include assessing the makeup and diversity of the Board, identifying and recommending qualified

candidates to be nominated for election as directors at the Annual Meeting or to be appointed by the Board to fill an existing or newly created vacancy on the Board; recommending members of the Board to serve on each Board committee; and annually reviewing and recommending the leadership structure of the Board. The Nominating and Governance Committee discusses with Management and reports to the Board major risk exposures in connection with matters overseen by the Committee. Its activities include:

 

evaluating director candidates for nomination;

 

evaluating the appropriate Board size;

 

reviewing and recommending corporate governance guidelines to the Board;

 

providing oversight with respect to the annual evaluation of Board, Committee and individual director performance;

 

overseeing the Company’s political and charitable contributions;

 

assisting the Board in its oversight of the Company’s insider trading compliance program; and

 

recommending director education.

All nominees for election as directors currently serve on the Board of Directors and are known to the Nominating and Governance Committee in that capacity. The Nominating and Governance Committee held fourfive meetings in fiscal 2018.2019.

 

 

Committee Member Independence

 

 

The Board has determined that each member of the Audit, Compensation, Nominating and Governance, and Finance Committees is an independent director for purposes of the NASDAQ Listing Rules as well as under the additional Director Independence Guidelines adopted by the Board. In addition, the members of the Audit Committee are all independent as required under RuleRule 10A-3(b)(1)(ii) under the Securities Exchange Act of 1934, and the members of the

Compensation Committee meet the definitions of (i) a“non-employee director” within the meaning of Rule16b-3 under the Securities Exchange Act of 1934, as amended, (ii) an “outside director” within the meaning of Section 162(m) of the Internal Revenue Code of 1986, as amended (“IRC”), and (iii) the requirements of RuleRule 10C-1 under the Securities Exchange Act of 1934.

 

 

Executive Sessions

 

 

Our independent,non-employee Directors meet in executive session without Management present at each regularly scheduled meeting of the Board. Mr. Goebel is currently designated by the Board to act as the Lead Director for such executive sessions.

The Audit Committee also holds executive sessions at each regularly scheduled meeting, and the other Committees of the Board meet in executive session as they deem appropriate.

 

 

Board Composition and Refreshment

Policy Regarding Consideration of Director Candidates and Makeup and Diversity of the Board. The Nominating and Governance Committee has the responsibility to identify,

screen, and recommend qualified candidates to the Board for nomination as directors. In evaluating director candidates, the Nominating and Governance Committee considers the

JACK IN THE BOX INC.  ï  20192020 PROXY STATEMENT2325

 

  CORPORATE GOVERNANCE  

    

 

Board Composition and Refreshment

Policy Regarding Consideration of Director Candidates and Makeup and Diversity of the Board.The Nominating and Governance Committee has the responsibility to identify, screen, and recommend qualified candidates to the Board for nomination as directors. In evaluating director candidates, the Nominating and Governance Committee considers the qualifications listed in the Jack in the Box Inc. Corporate Governance Principles and Practices, which are available athttp://investors.jackinthebox.cominvestors.jackinthebox.com.

The following are some of the factors generally considered by the Nominating and Governance Committee in evaluating director candidates:

 

the appropriate size of the Board;

 

the perceived needs of the Company for particular skills, background, and business experience;

 

the skills, background, reputation and experience of the nominees, including whether those qualities add to a diversity of experiences, backgrounds, individuals, viewpoints and perspectives on the Board;

 

leadership, character and integrity;

 

independence from Management and from potential conflicts of interest with the Company;

 

experience with accounting rules and practices;

 

experience with executive compensation;

 

applicable regulatory and listing requirements, including independence requirements and legal considerations;

interpersonal and communications skills and the benefits of a constructive working relationship among directors; and

the desire to balance the considerable benefits of continuity with the periodic injection of the fresh perspective provided by new members.

The Nominating and Governance Committee may also consider such other factors as it may deem are in the best interests of the Company and its stockholders.

Retirement Policy. The Board has adopted a retirement policy under which directors may not stand for election or be appointed after age 73. The Board does not believe it should establish term limits which could disadvantage the Company by forcing out directors whose tenure and experience continue to add value to the workings of the Board.

Board Tenure Review Policy. The Company has a tenure review policy pursuant to which any director who has served more than 12 years on the Board shall submit to the Committee his or her voluntary offer to resign from the Board. The Committee undertakes a thorough review of any such director’s continued effectiveness and appropriateness for service and recommends to the full Board that it either accept or reject the offer of resignation; in the latter event, the long-tenured director may continue to serve on the Board and mustre-submit his or her resignation offer every three years for subsequent review.

 

 

Stockholder Recommendations and Board Nominations

 

 

In order to be evaluated pursuant to the Nominating and Governance Committee’s established procedures, stockholder recommendations for candidates for the Board must be sent in writing to the following address at least 120 days prior to the first anniversary of the date of the previous year’s Annual Meeting of Stockholders:

Nominating and Governance Committee of the Board of

Directors c/o Office of the Corporate Secretary

Jack in the Box Inc.

9330 Balboa Avenue9357 Spectrum Center Blvd.

San Diego, CA 92123

Any recommendation submitted by a stockholder to the Nominating and Governance Committee must include the same information concerning the potential candidate and the recommending stockholder as would be required under Article III, Section 3.16 of the Jack in the Box Inc. Bylaws if the stockholder wished to nominate the candidate directly.

The Committee considers all candidates regardless of the source of the recommendation. In addition to stockholder recommendations, the Committee considers recommendations from current directors, Company personnel and others. The Company generally retains a search firm to assist it in identifying and screening candidates, and in conducting reference checks. The Committee applies the

same standards in evaluating candidates submitted by stockholders as it does in evaluating candidates submitted by other sources.

A candidate nominated by a stockholder for election at an Annual Meeting of Stockholders will not be eligible for election unless the stockholder proposing the nominee has provided timely notice of the nomination in accordance with the deadlines (at least 120 days and no more than 150 days prior to the first anniversary of the date of the previous year’s Annual Meeting of Stockholders) and other requirements set forth in the Company’s Bylaws. Article III, Section 3.16 of the Company’s Bylaws provides that, in order to be eligible for

26    JACK IN THE BOX INC.ï  2020 PROXY STATEMENT

  CORPORATE GOVERNANCE  

election as a director, a candidate must deliver to the Corporate Secretary statements indicating whether the candidate:

 

is a party to any voting commitment that has not been disclosed to the Company;

 

is a party to any voting commitment that could limit the nominee’s ability to carry out a director’s fiduciary duties;

 

is a party to any arrangements for compensation, reimbursement, or indemnification in connection with service as a director and has committed not to become a party to any such arrangement; and

24    JACK IN THE BOX INC.ï   2019 PROXY STATEMENT

  CORPORATE GOVERNANCE  

will comply with the Company’s publicly disclosed policies and guidelines.

The foregoing is a summary of provisions of the Company’s Bylaws and is qualified by reference to the actual provisions of Article III, Section 3.16.

 

 

Code of Conduct

 

 

Jack in the Box Inc. is committed to establishing and maintaining an effective ethics and compliance program that is intended to increase the likelihood of preventing, detecting, and correcting ethical lapses and violations of law or Company policy. In 1998, the Company adopted a Code of Conduct (the “Code”) which applies to all officers, and employees, as well as to our Board of Directors. The Company also provides our franchisees and significant vendors with our Code and with procedures for communicating any ethics or compliance concerns to the Company. The Code is revised from time to time, most recently in May 2018, following the sale of Qdoba Restaurant Corporation.

The Code (also called “The Integrity Playbook”) is available on the Company’s website athttp://investors.jackinthebox.com.investors.jackinthebox.com. We will disclose amendments to, or waivers of our Code that are required to be disclosed under the securities rules, by posting such information on the Company’s website,www.jackintheboxinc.com. Any waiver of our Code for directors or executive officers must be approved by the Board of Directors. The Company did not grant any such waivers in fiscal 20182019 and does not anticipate granting any such waiver in fiscal 2019.2020.

 

 

Compensation Committee Interlocks and Insider Participation

 

 

No member of our Compensation Committee is an officer, former officer, or employee of the Company. During fiscal 2018,2019, no member of the Compensation Committee had any relationship with the Company requiring disclosure under Item 404 of RegulationRegulation S-K. During fiscal 2018,2019, no interlocking

interlocking relationship existed between any of our executive officers or Compensation Committee members, on the one hand, and the executive officers or Compensation Committee members of any other entity, on the other hand.

 

 

Additional Corporate Governance Principles and Practices

 

 

The Company has adopted Corporate Governance Principles and Practices which contain general principles and practices regarding the functioning of the Board of Directors and the Board Committees. The Nominating and Governance Committee regularly reviews the Principles and Practices and recommends revisions if and as appropriate. The full text of the Principles and Practices may be found athttp://investors.jackinthebox.com. The Principles and Practices address many of the items discussed above, and also include the following items:

Limitation on Other Board Service.Non-employee directors may not serve on the boards of more than three other public companies. Our Corporate Officers are generally limited to serving on no more than one outside public company board, taking into consideration the time commitment and potential business conflicts inherent in such service.

Review of Director Skill Matrix.The Nominating and Governance Committee annually utilizes a skill matrix to assess the capabilities of the current directors and any needs for the Board as a whole. The matrix itself is updated if and as necessary to assure that it remains relevant to the evolving needs of the Company and the Board.

Board, Committee, and Individual Director EvaluationsEvaluations..The directors annually participate in a robust evaluation process focusing on an assessment of Board operations as a whole and the service of each director. Additionally, each of the Audit, Compensation, Finance, and Nominating and Governance Committees conducts a separate evaluation of its own performance and the adequacy of its charter. The Nominating and Governance Committee coordinates the evaluation of individual directors and of the Board operations, and reviews and reports to the Board on the outcome of

JACK IN THE BOX INC.ï  2020 PROXY STATEMENT27

  CORPORATE GOVERNANCE  

these self-evaluations. As part of the evaluation process most years, the Lead Director will meet individually with each director to generate and discuss any ideas for improving the effectiveness of the director and/or the Board.

New Director Orientation and Continuing Education.The Board works with Management to schedulenew-director orientation programs and continuing education programs for

directors. Orientation is designed to familiarize new directors with the Company and the franchise restaurant industry as well as Company personnel, facilities, strategies and challenges, and corporate governance practices, including board ethics. Continuing education programs may includein-house and third-party presentations and programs.

 

 

28JACK IN THE BOX INC.  ï  20192020 PROXY STATEMENT25

 

  DIRECTOR COMPENSATION AND STOCK OWNERSHIP GUIDELINES  

 

DIRECTOR COMPENSATION AND STOCK OWNERSHIP GUIDELINES

The Compensation Committee of the Board of Directors (the “Committee”) is responsible for reviewing and recommending to the Board the form and amount of compensation for ournon-employee directors. The following discussion of compensation and stock ownership guidelines applies only to ournon-employee directors and does not apply to Mr. Comma. Mr. Comma is an employee of the Company, compensated as an executive officer, and does not receive additional compensation for service as a director.

The Board believes that total compensation for directors should reflect the work required in both (i) their ongoing oversight and governance role and (ii) their continuous focus on driving long-term performance and stockholder value. The compensation program is designed to provide pay that is competitive with directors in the Company’s Peer Group. (The methodology used in determining the companies in the Fiscal 2019 Peer Group, and thethose companies, in the Fiscal 2018 Peer Group are described in Section III.b of the Compensation Discussion & Analysis (“CD&A”) in this Proxy Statement). The program consists of a combination of cash retainers and equity awards in the form of time-vested restricted stock units (“RSUs”). “Competitive” is defined as approximating the 50th50th percentile of pay of Peer Group directors.

Director Compensation Program Review and Changes

 

 

Director compensation is reviewed periodically with an independent compensation consultant. Any changes to director cash retainers and/or annual stock award values generally occur only after such review.

DuringIn 2018, the Committee engaged the services of an independent consulting firm (other than its regular independent executive compensation consultant) to evaluate director compensation for future fiscal years. No changes were made to director compensation are planned for fiscal 2019.

 

 

Annual Compensation Program

 

a. Cash Retainers

 

Each director receives an annual cash retainer for his or her service on the Board, service on Board committees, service as chair of a Board committee, and service as Lead Director, as applicable. There are no meeting fees. Retainers are paid in a single installment on the first business day of the month following the Annual Stockholder Meeting each year. Each new director receives a prorated retainer that is paid on the first business day of the month following his or her appointment to the Board.

20182019 RETAINERS

 

Annual Board Service:

 

        

 

$65,000

 

 

 

Lead Director:

 

        

 

$17,500

 

 

 

Committee  Committee
Chair(1)		   Committee
Membership		 

Audit

 

   

 

$25,000

 

 

 

   

 

$10,000

 

 

 

Compensation

 

   

 

$25,000

 

 

 

   

 

$  7,500

 

 

 

Finance

 

   

 

$12,500

 

 

 

   

 

$  5,000

 

 

 

Nominating & Governance

 

   

 

$12,500

 

 

 

   

 

$  5,000

 

 

 

(1)

Includes Committee membership retainer

Directors may elect to defer receipt of some or all of their cash retainers in the form of Common Stock equivalents under the

under the Jack in the Box Inc. Deferred Compensation Plan forNon-Management Directors (the “Director Deferred Compensation Plan”). The number of Common Stock equivalents credited to a director’s account is based on a per share price equal to the average of the closing price of Common Stock on the NASDAQ Stock Market for the 10 trading days immediately preceding the date the deferred compensation is credited to the director’s account. Under the Director Deferred Compensation Plan, to the extent dividends are paid, dividend equivalents and fractions thereof are converted to additional Common Stock equivalents and are credited to a director’s deferred compensation account as of the dividend payment dates. Each director’s account is settled in an equal number of shares of Common Stock upon the director’s termination of service from the Board. The Director Deferred Compensation Plan is anon-qualified plan under the IRC.Internal Revenue Code.

b. Expenses

The Company reimburses directors for customary and usual travel andout-of-pocket expenses incurred in connection with attendance at Board and committee meetings.

 

 

26JACK IN THE BOX INC.  ï  20192020 PROXY STATEMENT29

 

  DIRECTOR COMPENSATION AND STOCK OWNERSHIP GUIDELINES  

 

c. Annual Equity Grant — Restricted Stock Units

 

Each director receives an annual grant of RSUs under the Jack in the Box Inc. 2004 Stock Incentive Plan (“2004 Stock Incentive Plan”). We grant RSUs for the following reasons:

 

RSUs cause the value of directors’ share ownership to rise and fall with that of other stockholders, serving the objective of alignment with stockholder interests.

 

RSUs are a prevalent form of director compensation among the Company’s Peer Group.

The Company determines the number of RSUs to be granted by dividing the annual equity award value of $90,000 by the closing price of Common Stock on the date of the annual

grant, which is shortly after the annual meeting of stockholders, provided the director is providing services to the Company on the date of grant. RSUs vest on the earlier of the first business day 12 months from the date of grant (unless deferred) or upon the director’s termination of service with the Board. Directors may elect to defer receipt of shares issuable under RSU awards to termination of their Board service; and beginning with the February 2015 RSU awards, shares that have vested and been deferred earn a dividend (in the form of Common Stock equivalents) to the same extent the Company pays a dividend on outstanding shares.

 

 

Director Ownership and Stock Holding Requirements

 

The Board believes that all directors should maintain a meaningful personal financial stake in the Company to align their long-term interests with those of our stockholders. Pursuant to our Corporate Governance Principles and Practices, the Board desires that, within a reasonable period after joining the Board, eachnon-employee director hold Common Stock with a value of at least three times the annual cash Board service retainer. Direct holdings, unvested and deferred RSUs, and Common Stock equivalents count toward ownership value. In addition, each director is required to hold at least 50% of the shares resulting from RSU grants until termination of his or her Board service. The table below shows eachnon-employee director’s ownership value as of fiscalyear-end 2018,2019, based on a closing stock price of $83.83$90.45 on the last trading day of fiscal 2018,2019, September 28, 2018.27, 2019. Each of our directors meets the stock holding requirement, except Ms. YeungBirch and Mr. Gainor who joined the board in April 2017May 2019 and isare still within the transition period for compliance.

 

Name  Board Service
Effective Date		   

Direct Holdings/

Unvested RSUs

   Deferred
Units &
Common Stock
Equivalents		   

Total

Value

   

Board Service

Effective Date

   Direct Holdings/
Unvested RSUs		   Deferred
Units &
Common Stock
Equivalents		   

Total

Value

 

Ms. Birch

  

 

May 2019

 

  

 

$     74,531

 

  

 

$              0

 

  

$

74,531

 

Mr. Gainor

  

 

May 2019

 

  

 

$   128,801

 

  

 

$              0

 

  

$

128,801

 

Mr. Goebel

   

 

Dec. 2008

 

 

 

   

 

$966,057

 

 

 

   

 

$   576,080

 

 

 

  $

 

1,542,137

 

 

 

  

 

Dec. 2008

 

  

 

$1,054,828

 

  

 

$   834,673

 

  

$

1,889,501

 

Ms. John

   

 

Sept. 2014

 

 

 

   

 

$287,788

 

 

 

   

 

$     81,315

 

 

 

  $

 

369,103

 

 

 

  

 

Sept. 2014

 

  

 

$   322,997

 

  

 

$   181,352

 

  

$

504,349

 

Ms. Kleiner

   

 

Sept. 2011

 

 

 

   

 

$633,419

 

 

 

   

 

$   558,224

 

 

 

  $

 

1,191,643

 

 

 

  

 

Sept. 2011

 

  

 

$   695,922

 

  

 

$   697,641

 

  

$

1,393,563

 

Mr. Murphy

   

 

Sept. 2002

 

 

 

   

 

$139,912

 

 

 

   

 

$5,235,519

 

 

 

  $

 

5,375,431

 

 

 

  

 

Sept. 2002

 

  

 

$   163,443

 

  

 

$5,834,749

 

  

$

5,998,192

 

Mr. Myers

   

 

Dec. 2010

 

 

 

   

 

$573,649

 

 

 

   

 

$   944,513

 

 

 

  $

 

1,518,162

 

 

 

  

 

Dec. 2010

 

  

 

$   631,431

 

  

 

$1,228,582

 

  

$

1,860,013

 

Mr. Tehle

   

 

Dec. 2004

 

 

 

   

 

$375,307

 

 

 

   

 

$3,938,669

 

 

 

  $

 

4,313,976

 

 

 

  

 

Dec. 2004

 

  

 

$   507,877

 

  

 

$4,310,666

 

  

$

4,818,543

 

Mr. Wyatt

   

 

May 2010

 

 

 

   

 

$590,499

 

 

 

   

 

$   808,960

 

 

 

  $

 

1,399,459

 

 

 

  

 

May 2010

 

  

 

$   649,612

 

  

 

$   970,800

 

  

$

1,620,412

 

Ms. Yeung

   

 

 

April 2017

 

 

 

 

 

   

 

 

$  83,830

 

 

 

 

 

   

 

 

$     76,704

 

 

 

 

 

  $

 

 

 

160,534

 

 

 

 

 

 

 

  

 

April 2017

 

  

 

$   102,932

 

  

 

$   268,003

 

  

$

370,935

 

 

30JACK IN THE BOX INC.  ï  20192020 PROXY STATEMENT27

 

  DIRECTOR COMPENSATION AND STOCK OWNERSHIP GUIDELINES  

 

Fiscal 20182019 Compensation

 

The table below shows the compensation amounts for each of the Company’snon-employee directors who served in fiscal 2018.2019. Each director received an annual equity award of 1,0001,138 RSUs, valued at $90,000 on the date of grant (February 28, 2018).(March 4, 2019), except Ms. Birch and Mr. Gainor who joined the Board in May 2019 and received a prorated award. The RSUs vest 100% on the earlier of the first business day 12 months from the date of grant or upon the director’s termination of service with the Board.

For fiscal 2018,2019, the average annual compensation of directors was $176,875, comprised of (i) $86,875 in cash and (ii) $90,000 in RSUs. This average excludes dividend payments on deferred accounts.accounts and the prorated compensation paid to Ms. Birch and Mr. Gainor.

 

Name  Fees Earned or
Paid in Cash (1)		   Stock
Awards (2)		   All Other
Compensation (3)		   Total   

Fees Earned or

Paid in Cash (1)

   

Stock

Awards (2)

   

All Other

Compensation (3)

   Total 

Ms. Birch

  

 

$58,125

 

  

 

$67,500

 

  

$

0

 

  

$

125,625

 

Mr. Gainor

  

 

$58,125

 

  

 

$67,500

 

  

$

0

 

  

$

125,625

 

Mr. Goebel

   

 

$95,000

 

 

 

   

 

$90,000

 

 

 

   

 

$10,064

 

 

 

  $

 

195,064

 

 

 

  

 

$95,000

 

  

 

$90,000

 

  

$

13,883

 

  

$

198,883

 

Ms. John

   

 

$77,500

 

 

 

   

 

$90,000

 

 

 

   

 

$  1,154

 

 

 

  $

 

168,654

 

 

 

  

 

$77,500

 

  

 

$90,000

 

  

$

2,936

 

  

$

170,436

 

Ms. Kleiner

   

 

$85,000

 

 

 

   

 

$90,000

 

 

 

   

 

$  2,687

 

 

 

  $

 

177,687

 

 

 

  

 

$87,500

 

  

 

$90,000

 

  

$

4,498

 

  

$

181,998

 

Mr. Murphy

   

 

$95,000

 

 

 

   

 

$90,000

 

 

 

   

 

$83,540

 

 

 

  $

 

268,540

 

 

 

  

 

$77,500

 

  

 

$90,000

 

  

$

87,313

 

  

$

254,813

 

Mr. Myers

   

 

$80,000

 

 

 

   

 

$90,000

 

 

 

   

 

$14,630

 

 

 

  $

 

184,630

 

 

 

  

 

$87,500

 

  

 

$90,000

 

  

$

18,354

 

  

$

195,854

 

Mr. Tehle

   

 

$87,500

 

 

 

   

 

$90,000

 

 

 

   

 

$54,859

 

 

 

  $

 

232,359

 

 

 

  

 

$95,000

 

  

 

$90,000

 

  

$

55,895

 

  

$

240,895

 

Mr. Wyatt

   

 

$95,000

 

 

 

   

 

$90,000

 

 

 

   

 

$  4,978

 

 

 

  $

 

189,978

 

 

 

  

 

$95,000

 

  

 

$90,000

 

  

$

6,833

 

  

$

191,833

 

Ms. Yeung

   

 

 

$80,000

 

 

 

 

 

   

 

 

$90,000

 

 

 

 

 

   

 

 

$  1,089

 

 

 

 

 

  $

 

 

171,089

 

 

 

 

 

  

 

$80,000

 

  

 

$90,000

 

  

$

4,049

 

  

$

174,049

 

 

 (1) 

“Fees Earned or Paid in Cash” reflects Board and Committee retainers paid to each director in 20182019 either (a) in cash or (b) deferred at the director’s election (in the case of Ms. Yeung, and Messrs. Goebel Murphy, and Myers). Ms. Birch and Mr. Gainor, who joined the Board in May 2019, each received a prorated retainer payment and equity award of 824 RSUs, valued at $67,500 on the date of grant (June 3, 2019) for board and committee service from May 2019 through the next annual stockholder meeting in February 2020.

 
 (2)

“Stock Awards” reflects the grant date fair value of RSUs granted under the 2004 Stock Incentive Plan, computed in accordance with ASC 718.

 
 (3)

The amount reported in the “All Other Compensation” column reflects four dividend payments made during fiscal 20182019 that were credited to the applicable directors’ common stock equivalent accounts, in connection with (1) the respective director’s prior deferral of cash retainers, under the Director Deferred Compensation Plan described in the above section “a. Cash Retainers” and/or (2) beginning with the February 2015 RSU award, vested deferred RSUs as described in section c. “Annual Equity Grant – Restricted Stock Units.” Dividends are paid only to the same extent the Company pays a dividend on outstanding shares.

 

Outstanding Equity at FiscalYear-End

 

The table below sets forth the aggregate number of unvested and deferred RSUs held by ournon-employee directors at the end of fiscal 2018.2019.

 

Name  

Unvested

RSUs

   

Deferred

RSUs

   

Unvested

RSUs

   

Deferred

RSUs

 

Ms. Birch

  

 

824

 

  

 

0

 

Mr. Gainor

  

 

824

 

  

 

0

 

Mr. Goebel

   

 

1,000

 

 

 

   

 

3,290

 

 

 

  

 

1,138

 

  

 

4,290

 

Ms. John

   

 

1,000

 

 

 

   

 

957

 

 

 

  

 

1,138

 

  

 

1,957

 

Ms. Kleiner

   

 

1,000

 

 

 

   

 

6,604

 

 

 

  

 

1,138

 

  

 

7,604

 

Mr. Murphy

   

 

1,000

 

 

 

   

 

12,428

 

 

 

  

 

1,138

 

  

 

13,428

 

Mr. Myers

   

 

1,000

 

 

 

   

 

3,914

 

 

 

  

 

1,138

 

  

 

4,914

 

Mr. Tehle

   

 

1,000

 

 

 

   

 

14,640

 

 

 

  

 

1,138

 

  

 

14,640

 

Mr. Wyatt

   

 

1,000

 

 

 

   

 

9,553

 

 

 

  

 

1,138

 

  

 

10,553

 

Ms. Yeung

   

 

 

1,000

 

 

 

 

 

   

 

 

0

 

 

 

 

 

  

 

1,138

 

  

 

1,000

 

 

28JACK IN THE BOX INC.  ï  20192020 PROXY STATEMENT31

  REPORT OF THE AUDIT COMMITTEE  

    

  REPORT OF THE AUDIT COMMITTEE  

 

REPORT OF THE AUDIT COMMITTEE

 

The following is the report of the Audit Committee with respect to Jack in the Box Inc.’s audited consolidated financial statements for the fiscal year ended September 30, 2018.29, 2019.

The Audit Committee has reviewed and discussed the annual consolidated financial statements with Management and KPMG LLP (“KPMG”), the Company’s independent registered public accounting firm (the “independent auditor”). Management is responsible for the financial reporting process, the system of internal controls, including internal control over financial reporting, risk management and procedures designed to ensure compliance with accounting standards and applicable laws and regulations. The independent auditor is responsible for performing an independent audit of the consolidated financial statements and expressing an opinion on the conformity of those financial statements with accounting principles generally accepted in the United States of America, as well as expressing an opinion on the effectiveness of internal control over financial reporting. The Audit Committee is responsible for the appointment, compensation and oversight of the independent auditor.

The Audit Committee met on sixfour occasions in the fiscal year ended September 30, 2018. The29, 2019. At each such meeting, the Audit Committee met with the independent auditor, with and without Management present, to discuss the results of its audit and quarterly reviews of the Company’s financial statements. The Audit Committee also discussed with the independent auditor the matters required to be discussed by Public Company Accounting Oversight Board (PCAOB) Statement on Auditing Standards No. 161301Communications with Audit Committees.The Audit Committee also received from the Company’s independent auditor the written disclosures and the letter required by applicable requirements of the PCAOB regarding their communications with the Audit Committee concerning independence and has discussed with the independent

auditor its independence from the Company. The Audit

Committee also has considered whether the provision ofnon-audit services to the Company is compatible with the independence of the independent auditor.

In connection with the Company’s sale of Qdoba that closed in March 2018,August 2019, the Audit Committee approved the scope and fees for the engagement of KPMG to perform additional audit services in connection with the Qdoba business on a separate,carved-out basis.Company’s completed securitization transaction that closed in July 2019.

In performing its functions, the Audit Committee acts only in an oversight capacity and necessarily relies on the work and assurances of the Company’s Management and internal audit group as well as the Company’s independent auditor whose reports express opinions on the conformity of the Company’s annual financial statements with U.S. generally accepted accounting principles and on the effectiveness of internal control over financial reporting.

Based on the reviews and discussions referred to above, and the reports of KPMG, the Audit Committee recommended to the Board of Directors, and the Board of Directors approved, the inclusion of the audited consolidated financial statements in the Company’s Annual Report on FormForm 10-K for the fiscal year ended September 30, 2018,29, 2019, for filing with the SEC.

THE AUDIT COMMITTEE

Michael W. Murphy,David M. Tehle, Chair

Madeleine Kleiner

James M. Myers

David M. Tehle

Vivien M. Yeung

This report is not deemed to be incorporated by reference in any filing by the Company under the Securities Act of 1933 or the Securities Exchange Act of 1934, except to the extent that the Company specifically incorporates this report by reference.

 

 

32JACK IN THE BOX INC.  ï  20192020 PROXY STATEMENT29

 

  INDEPENDENT REGISTERED PUBLIC ACCOUNTANTS FEES AND SERVICES  

 

INDEPENDENT REGISTERED PUBLIC ACCOUNTANTS FEES AND SERVICES

 

The following table presents fees billed for professional services rendered by KPMG, the Company’s independent registered public accountants, for the fiscal years ended September 29, 2019 and September 30, 2018 and October 1, 2017.2018.

 

    2018   2017 

Audit Fees (1)

  $ 1,185,987   $1,098,414 

Qdoba Audit Fees(2)

   305,000    880,000 

Tax Fees (3)

   12,314    612 

All Other Fees

   —    — 

KPMG Total Fees

  $1,503,301   $1,979,026 
    2019   2018 

Audit Fees (1)

  $ 1,118,963   $1,185,987 

Securitization Related Audit Fees(2)

  $265,000   

 

—

 

Qdoba Audit Fees(3)

  

 

—

 

  $305,000 

Tax and other Fees(4)

  

 

—

 

  $12,314 

KPMG Total Fees

  $ 1,383,963   $1,503,301 
(1)

Audit Fees include fees for the audit of the Company’s consolidated annual financial statements and the audit of the effectiveness of internal controls over financial reporting. Audit Fees also include fees for review of the interim financial statements included in our Form10-Q quarterly reports and the issuance of consents and services that are normally provided by the independent registered public accounting firm in connection with statutory and regulatory filings or engagements.

(2)

Securitization Related Audit Fees include fees for the July 8, 2019 opening balance sheet audit of Different Rules, LLC, the fiscal 2019 audit of Jack in the Box SPV Guarantor, LLC and Subsidiaries, and comfort letter services.

(3)

Qdoba Audit Fees include fees for the audit of the Qdoba Restaurant Corporation’s (“QRC’s”)carved-out financial statements for fiscal year 2017 and fees for review of the QRC’scarved-out interim financial statements for the first quarter ended January 21, 2018.

(3)(4) 

Tax feesand other Fees include fees for services rendered in connection with amendment to the Company’s credit facility in fiscal 2018, and additionally in fiscal 2017, for sales tax audit defense.2018.

Registered Public Accountants’ Independence.The Audit Committee has considered whether the provision of the above-noted services, other than audit services, is compatible with maintaining KPMG’s independence, and has determined that the provision of such services has not adversely affected KPMG’s independence.

Policy on Audit CommitteePre-Approval of Services.The Company and its Audit Committee are committed to ensuring the independence of the independent registered public accountants, both in fact and in appearance. In this regard, the Audit Committee has established apre-approval policy in accordance with applicable securities rules. The Audit Committee’spre-approval policy is set forth in the Audit CommitteePre-Approval Policy, which is available on our website athttp://investors.jackinthebox.com.

 

 

30JACK IN THE BOX INC.  ï  20192020 PROXY STATEMENT33

 

  PROPOSAL TWO — RATIFICATION OF THE APPOINTMENT OF INDEPENDENT  REGISTERED PUBLIC ACCOUNTANTS  

 

PROPOSAL TWO — RATIFICATION OF THE APPOINTMENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTANTS

The Audit Committee has appointed the firm of KPMG LLP as the Company’s independent registered public accountants for fiscal year 2019.2020. Although action by stockholders in this matter is not required, the Audit Committee believes it is appropriate to seek stockholder ratification of this appointment.

KPMG LLP has served as the Company’s independent auditor since 1986. One or more representatives of KPMG LLP is expected to be present at the Annual Meeting and will have the opportunity to make a statement and to respond to appropriate questions from stockholders present at the meeting. The following proposal will be presented at the Annual Meeting:

Action by the Audit Committee appointing KPMG LLP as the Company’s independent registered public accountants to conduct the annual audit of the consolidated financial statements of the Company and its subsidiaries for the fiscal year ending September 29, 2019,27, 2020, is hereby ratified, confirmed and approved.

Vote Required for Ratification

Ratification requires the affirmative vote of a majority of the votes present in person or represented by proxy at the Annual Meeting and entitled to vote on such proposal. Abstentions will be included in the number of shares present and entitled to vote and will have the same effect as a vote “AGAINST” this proposal. Brokers have discretionary authority to vote uninstructed shares on this matter.

THE BOARD OF DIRECTORS RECOMMENDS A VOTE “FOR” RATIFICATION OF THE APPOINTMENT OF KPMG LLP AS THE COMPANY’S INDEPENDENT REGISTERED PUBLIC ACCOUNTANTS.

 

34JACK IN THE BOX INC.  ï  20192020 PROXY STATEMENT31

 

  PROPOSAL THREE — ADVISORY VOTE ON EXECUTIVE COMPENSATION  

 

PROPOSAL THREE — ADVISORY VOTE ON EXECUTIVE COMPENSATION

As required under the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (the “Dodd-Frank Act”), stockholders have the opportunity to cast an advisory vote on the compensation of our named executive officers (“NEOs”) as disclosed in the CD&A, the compensation tables, narrative disclosures, and related footnotes included in this Proxy Statement. This “Say on Pay” vote is advisory, and therefore nonbinding on the Company; however, the Compensation Committee of the Board of Directors, which is comprised entirely of independent directors, values the opinions of our stockholders and will take into account the outcome of the vote when considering future executive compensation decisions. We received a 98.2%98.1% favorable vote on Say on Pay at our February 2018March 2019 Annual Meeting of Stockholders.

The Compensation Committee engages the services of an independent compensation consultant to advise on executive compensation matters, including competitive compensation targets within the marketplace, and Company performance goals and analysis.

As discussed in more detail in the CD&A, our executive compensation program is designed to attract and retain a talented team of executives who can deliver on our commitment to build long-term stockholder value. The Compensation Committee believes our program is competitive in the marketplace, links pay to performance by rewarding our NEOs for achievement of short-term and long-term financial and operational goals (and, in some years, strategic goals), and aligns our NEOs’ interests with the long-termlong- term interests of our stockholders by providing a mix of performance and service-based equity awards. Specifically, a significant portion of compensation paid to our NEOs is based on the Company’s business performance.

Our fiscal 20182019 NEOs includewere our Chief Executive Officer (CEO); current and formerExecutive Vice President (EVP), Chief Financial OfficersOfficer (CFO); EVP, Chief of Staff and Strategy; EVP, Chief Legal and Risk Officer; Seniorand Vice President, of Finance, Controller and Treasurer; and former Jack in the Box Brand President.Chief Operating Officer (COO).

The Compensation Committee believes stockholders should consider the following key components of our compensation programs and governance practices when voting on this proposal:

 

Pay for Performance Orientation

 

• 

Competitive, Targeted PayPay.. We target executive base salary, total cash compensation, and total direct compensation to deliver competitive pay for performance that meets expectations, and the opportunity for higher pay only if performance exceeds expectations.

 

• 

Pay MixMix.. Our executive compensation program includes a mix of fixed and variable compensation, with a significant portion of target compensation in the form of annual and long-term incentives that directly tie to achievement of key Company goals and drive long-term stockholder value.

 

• 

Long-Term Incentives (“LTI”).. Annual equity awards for our NEOs in fiscal 2019 included aan equal mix of stock options, and performance shares (“PSUs”) and time-vested restricted stock units (“RSUs”) with holding requirements. The PSUs vest three years after the grant, depending on the Company’s achievement of goals over a three-fiscal year period. The grant guidelines, goals, and performance metrics for the PSU awards granted in December 2017November 2018 for the performance period fiscal 2018-20202019-2021 are further described in the CD&A.

• 

20182019 Annual IncentivesIncentives.. In 2018,2019, our NEOs’ annual incentive opportunity was based on (1) Jack in the Box Operating Earnings Before Interest and Taxes (“Operating EBIT”), (2) Jack in the Box Restaurant Operating Margin (“ROM”EBIT (weighted 70%), and (3) Strategic goals (subject to meeting minimum threshold Operating EBIT performance) that were tied to business model transformation, including (a) refranchising, (b) completing the sale of Qdoba and implementing its separation, (c) organizational restructuring on path to reducing G&A, and (d) capital structure and borrowing capacity optimization.(2) Restaurant Level Margin (weighted 30%). The incentive payout was based on the Company performing between target and maximum performance on the Operating EBIT financial goal, and between threshold and target performance on the twoRestaurant Level Margin financial targets (Jack in the Box Operating EBIT and ROM), and above target performance on the strategic goals,goal, as determined by the Compensation Committee.

Messrs. Tucker and Rebel, who were employed for less than the full fiscal year received a prorated annual incentive payout based on Company performance and time employed. Ms. Allen, who separated from the Company in February 2018, did not receive an annual incentive payment.

 

 

32JACK IN THE BOX INC.  ï  20192020 PROXY STATEMENT35

 

  PROPOSAL THREE — ADVISORY VOTE ON EXECUTIVE COMPENSATION  

 

Alignment with Long-Term Stockholder Interests

 

• 

Equity Awards. The largest portion of our NEOs’ total pay is delivered in equity awards (including options,(for fiscal 2019, PSUs and RSUs), with such equity awards accounting for 69%68% of the CEO’s targeted total direct compensation in fiscal 2018.2019.

 

  

Option awards and time-vestedTime-vested RSUs have multi-year vesting; performance awards are typically based on achievement of financial goals over a three-fiscal year period. All RSUs, and earned PSUs beginning with the fiscal 2016 PSU award, are subject to a holding requirement under which our NEOs and other executive officers must hold at least 50% ofafter-tax net shares until termination or retirement.

• 

Stock Ownership Requirement. Our NEOs and other executive officers are required to own a significant amount of the Company’s stock, based on a multiple of salary.

 

• 

No Evergreen – No Repricing. We do not have an evergreen plan, and we prohibit repricing equity awards without stockholder approval.

 

• 

No Pledging or HedgingHedging.. We As described in greater detail in the CD&A, we prohibit Section 16 officers (including our NEOs and other executive officers) from pledging Company stock as collateral for any obligation or engaging in hedging transactions involving our stock.

 

 

Recommendation

With the assistance of its independent compensation consultant, the Compensation Committee has thoughtfully developed our executive compensation programs, setting NEO compensation that links pay to performance and provides an appropriate balance of short-term and long-term incentives that are aligned with long-term stockholder interests. Accordingly, the Board of Directors recommends that you vote in favor of the following resolution:

“RESOLVED, that Jack in the Box Inc. stockholders approve, on an advisory basis, the compensation of the Company’s named executive officers as described in the Company’s Compensation Discussion and Analysis, tabular disclosures, and other narrative disclosures in this Proxy Statement for the 20192020 Annual Meeting of Stockholders.”

Approval of the Say on Pay proposal requires the affirmative vote of a majority of the shares present in person or represented by proxy at the Annual Meeting and entitled to vote on such proposal. Abstentions will be included in the number of shares present and entitled to vote and will have the same effect as a vote “AGAINST” the proposal. Brokernon-votes will not count as votes cast “FOR” or “AGAINST” the proposal and will not be included in calculating the number of votes necessary for approval for this proposal.

THE BOARD OF DIRECTORS RECOMMENDS A VOTE “FOR” THE APPROVAL OF THE COMPENSATION OF OUR NAMED EXECUTIVE OFFICERS, AS DISCLOSED IN THIS PROXY STATEMENT.

 

36JACK IN THE BOX INC.  ï  20192020 PROXY STATEMENT33

 

  CD&A — I. EXECUTIVE SUMMARY  

 

COMPENSATION DISCUSSION AND ANALYSIS

This Compensation Discussion and Analysis (“CD&A”) explains the key elements of our executive compensation program and compensation decisions for our named executive officers (“NEOs”) in fiscal 2018.2019. The Compensation Committee of our Board of Directors (the “Committee”), with input from its independent compensation consultant, oversees these programs and determines compensation for our NEOs.

Our fiscal year 20182019 NEOs are:

 

•

  

Leonard A. Comma

  

Chairman and Chief Executive Officer (“CEO”), our principal executive officer

•

  

Lance F. Tucker(1)

  

Executive Vice President, Chief Financial Officer (“CFO”), our principal financial officer

•

  

Jerry P. RebelMark H. Blankenship (1)

  

(Former) Executive Vice President, Chief Financial Officer, our former principal financial officer

•

Mark H. Blankenship

Former Executive Vice President, Chief of Staff and Strategy (“CSS”)

•

  

Phillip H. Rudolph(1)

  

Executive Vice President, Chief Legal and Risk Officer (“CLO”) and Corporate Secretary

•

  

PaulMarcus D. MelanconTom

  

Senior Vice President, of Finance, Controller and TreasurerChief Operating Officer (“SVP”)

•

Frances P. Allen(2)

(Former) Jack in the Box Brand President (���JIB President”COO”)

(1)

In connection with our restructuring following our completed sale of Qdoba Restaurant Corporation and other events, Dr. Blankenship ceased to be an officer and employee of the company following his January 3, 2020 separation date, and Mr. Rebel retired as Chief Financial Officer effective May 1, 2018. His successor, Mr. Tucker, was hired effective March 26, 2018.

(2)

Ms. Allen’s employment with the Company ended effectiveRudolph is expected to cease to be an officer and employee following his anticipated February 9, 2018.28, 2020 separation date.

Quick Reference Guide

 

Executive Summary

   Section I 

Compensation Principles and Objectives

   Section II 

Compensation Competitive Analysis

   Section III 

Elements of Compensation

   Section IV 

Compensation Decision-Making Process

   Section V 

Fiscal 20182019 Compensation

   Section VI 

Additional Compensation Information

   Section VII 

CEO Pay Ratio Disclosure

   Section VIII 

I. EXECUTIVE SUMMARY

 

Jack in the Box is committed to responsibly building long-term stockholder value. Our executive compensation program is designed to deliver on this commitment by using a balanced performance measurement framework that is aligned with the key drivers of Company performance and stockholder value creation. This executive summary provides an overview of our fiscal 20182019 performance, compensation framework and pay actions, targeted total direct compensation, and CEO pay for performance alignment.

a. Fiscal 20182019 Review

Fiscal 20182019 was marked by substantial accomplishments on key strategic initiatives,the Company’s first full year as the Company largely completed its transformation to an asset-light, single-brand organization while operatingorganization. Several restructuring efforts were completed during the year, including the completion of the transition services agreement with Qdoba. Through implementation of the Securitization in a highly competitive restaurant industry. However,the fiscal year, the Company did not meetachieved its target leverage ratio of approximately five times EBITDA. In addition to these structural changes, the Company continued to drive systemwide financial and operational performance. In fiscal 2019, we achieved our annual financial targets which directly impacted annual incentive payouts.ninth consecutive year of same-store sales growth.

Returns to Stockholders

2018 was our fifth consecutive year of returningThe Company returned more than $300$165 million to shareholders through stock buybacks and dividends, which have totaled nearly $1.8 billion over those five years. Fordividends. The Company’s stock price increased 7.3% to $90.45 per share at fiscal 2018 our cumulative total shareholder return (TSR) declined 16%. However, our TSR over the past five years increasedyear-end (“FYE”) 2019, versus $83.83 at a compound annual rate of 17.5%.FYE 2018.

 

34JACK IN THE BOX INC.  ï  2020 PROXY STATEMENT37

  CD&A — I. EXECUTIVE SUMMARY  

Financial and Operational Results

•

Systemwide same-store sales(1) increased 1.3% over prior year, marking the ninth consecutive year of same-store sales growth.

•

Operating Earnings Per Share(2) (“Operating EPS”) of $4.35 per share increased 14.8% from the prior year.

•

Adjusted EBITDA(3) increased 1.8% to $269.0 million, compared with $264.2 million in the prior year.

•

Operating EBIT(4) was $207.8 million, a 6% increase versus $196 million in the prior year.

•

Restaurant Level Margin(5) decreased by 20 basis points to 26.2% of company restaurant sales.

Through implementation of a securitization in the fiscal year, the Company achieved its target leverage of approximately five times EBITDA.

Incentive Compensation Outcomes

•

For the fiscal 2019 annual incentive plan, the Jack in the Box Operating Earnings Before Interest and Taxes (“Operating EBIT”)(4) result (weighted 70%) was 149% of target goal, and the Jack in the Box Restaurant Level Margin performance (weighted 30%) was 54% of target goal. In total, the CEO and other NEOs received an annual incentive payout of 120.5% of target payout.

•

For PSUs vested and payable in 2019 (granted in November 2016), the Jack in the Box Return on Invested Capital (ROIC)(6) FYE19 result was 150% of target, and the Systemwide Sales result for the Performance Period covering fiscal 2017-2019 (with goals established at the beginning of each fiscal year of the Performance Period) was 40% of target. In total, the CEO and other NEOs received a weighted payout of 95% of the target number of PSUs granted.

(1)

Systemwide same-store sales represent changes in sales at company and franchise restaurants open more than one year. 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 and percentage rent revenues are calculated based on a percentage of franchise sales. We believe system same-store sales information is useful to investors as it has a direct effect on the Company’s profitability.

(2)

Operating Earnings Per Share is a non-GAAP measure that represents diluted earnings per share from continuing operations on a GAAP basis excluding gains or losses on the sale of company operated restaurants, restructuring charges, loss on early termination of interest rate swaps, loss on early extinguishment of debt, the non-cash impact of the Tax Cuts and Jobs Act in fiscal year 2018, and the excess tax benefits from share-based compensation arrangements. See Appendix A — Reconciliation of non-GAAP measurements to GAAP Results.

(3)

Adjusted EBITDA represents net earnings on a GAAP basis excluding earnings or losses from discontinued operations, income taxes, interest expense, net, gains or losses on the sale of company-operated restaurants, impairment and other charges, net, depreciation and amortization, and the amortization of franchise tenant improvement allowances and other.

(4)

Operating EBIT is a non-GAAP measure defined by the Company as net earnings before interest expense, net and income taxes, excluding gains or losses on the sale of company operated restaurants, restructuring costs, and earnings or losses from discontinued operations. See Appendix A — Reconciliation of non-GAAP measurements to GAAP Results.

(5)

Restaurant Level Margin is defined as Company restaurant sales less restaurant operating costs (food and packaging, payroll and employee benefits, and occupancy and other costs) and is neither required by, nor presented in accordance with GAAP. Restaurant Level Margin excludes revenues and expenses of our franchise operations and certain costs, such as selling, general, and administrative expenses, depreciation and amortization, impairment and other charges, net, gains or losses on the sale of company-operated restaurants, and other costs that are considered normal operating costs. See Appendix A — Reconciliation of non-GAAP measurements to GAAP Results.

(6)

Adjusted ROIC is calculated as after-tax earnings from operations, excluding gains or losses on the sale of company-operated restaurants and restructuring charges, divided by average invested capital (which excludes accumulated other comprehensive income or loss related to the Company’s retirement plans).

38    JACK IN THE BOX INC.ï  2020 PROXY STATEMENT

    

 

  CD&A — I. EXECUTIVE SUMMARY  

 

Financial and Operational Results

Systemwide same-store salesincreased 0.1% over prior year, marking the eighth consecutive year of positive growth.

•

Restaurant-Level EBITDA(1) increased by 220 basis points to 26.4% of company restaurant sales.

•

Restaurant Operating Margin(1) (“ROM”) increased 260 basis points to 22.7% of company restaurant sales.

•

Operating Earnings Per Share(1) (“Operating EPS”) of $3.79 per share increased over 9% from the prior year.

Strategic Initiatives

The Company made progress onkey strategic initiatives, including:

Completing our refranchising initiative which increased our franchise mix to our desiredend-state of 94% at FYE 2018 (from 88% at 2017 fiscalyear-end), resulting in higher and more predictable levels of franchise revenues in the form of royalties and rental income while lowering our future capital spending requirements.

Completing the sale of our Qdoba brand effective March 21, 2018 for approximately $305 million in cash.

Reducing our corporate general and administrative expenses (“G&A”) by 20 basis points to 2.2% of system sales.

Achieving key milestones toward ultimately increasing the Company’s leverage to five times EBITDA.

Incentive Compensation Outcomes

•

The Jack in the Box Operating EBIT(2) result was 39% of target, and Jack in the Box ROM performance was 82% of target goal. Together, these metrics accounted for 80% of target incentive opportunity.

Management made substantial progress on the four strategic initiatives, as described above, which will better position the Company over the long-term. These four strategic initiatives together accounted for 20% of target incentive.

For fiscal 2018, the CEO and other NEOs received annual incentive payouts of 69.1% of target incentive (except for Ms. Allen who separated in February 2018 and did not receive an incentive). Mr. Rebel’s annual incentive waspro-rated based on his time of employed with the Company during fiscal 2018.

Other

The Company hired a new CFO to replace our former long-term CFO who retired during 2018. The Company also hired a new Chief Operating Officer in 2018.

b. Fiscal 20182019 Compensation Framework and Key Pay Actions

Our executive compensation program is designed to motivate, engage, and retain a talented executive leadership team and to appropriately reward them for their contributions to our business. Our performance measurement framework consists of a combination of financial and operationalmultiple performance metrics, varying time horizons, and multiple equity vehicles. The largest portion of our executives’ compensation is variable and is directly tied to the achievement of annual and longer-term financial and operating goals. In combination, these metrics and variables provide a balanced and comprehensive view of performance and drive the Committee’s executive compensation decisions.

Consistent with the fundamental principle that compensation programs should align pay with performance, the Company’s fiscal 2019 performance directly impacted compensation decisions and pay outcomes, as shown in the chart below that summarizes the compensation framework, key fiscal 2019 performance measures and pay actions.

Performance Measurement Framework with 2019 Pay

 

(1)
Base Salary

As set forth in Notes 1Long-Term Incentive

Following a review of total direct compensation relative to competitive market data of our Compensation Peer Group, and 2consideration that the Company was in the Proxy Summary, Restaurant-Level EBITDA, ROMmidst of its restructuring as a single brand and Operating EPS arenon-GAAP measures. Forthe evaluation of strategic alternatives, including a reconciliation of these measurespotential sale, the Committee determined not to make changes to the most comparable GAAP measures, please referbase salaries of our NEOs in fiscal 2019.

For fiscal 2019, due to Appendix A.the additional trading volatility resulting from the Company’s potential sale, the Committee awarded equity grants consisting only of Performance Shares and Restricted Stock Units, weighted equally, and did not grant stock options.

•50% Performance Shares (PSUs)

Vesting based on achievement over a three-fiscal year performance period (FY 2019–2021), with 50% holding requirement

• ROIC Goal (50%)

(Return on Invested Capital from Operations)

• Systemwide Sales Goal (50%)

(Company and Franchise Restaurants)

•50% Restricted Stock Units (RSUs)

25% vesting per year over four years, with 50% holding requirement

(2)Annual Incentive

•Performance Goals

•Operating EBIT is defined(70%)

•  Restaurant Level Margin (30%)

•Fiscal 2019 Results

Annual incentives were paid at120.5% of target payout based on the weighted results below:

•   JIB Operating EBIT performance was between target and explainedmaximum, resulting in 149% of target payout for this goal

•   Restaurant Level Margin was between threshold and target, resulting in 54% of target payout for this goal

Fiscal 2019 Actions Relating to PSU Grants

• For the FY 2019-2021 PSU grant, the Committee established two goals (1) an adjusted ROIC from Operations measure, based on the third fiscal year of the three-fiscal year performance period (FY 2021), and (2) Systemwide Sales growth, with goals set annually at the beginning of each fiscal year of the three-fiscal year performance period.

•For the FY 2017-2019 PSU grant, the Committee certified goal achievement and approved a payout of 95.0% of target PSUs granted based on performance during the three-fiscal year performance period, as described in Section VI.bVI.d. of thisthe CD&A.

 

JACK IN THE BOX INC.  ï  20192020 PROXY STATEMENT3539

 

  CD&A — I. EXECUTIVE SUMMARY  

    

 

Consistent with the fundamental principle that compensation programs should align pay with performance, the Company’s fiscal 2018 performance directly impacted compensation decisions and pay outcomes, as shownc. Fiscal 2019 Pay Mix

As reflected in the chart below that summarizes the compensation framework, key fiscal 2018 performance measures and 2018 pay actions.

LOGO

Performance Measurement Framework with 2018 Pay Actions Base Salary Our NEOs received salary increases in December 2017, ranging from 2.4% to 2.8% (averagefollowing charts, a significant percentage of 2.5%, which was aligned with increases for the broader staff and restaurant management population)_ These increases were given to maintain market competitiveness, and to recognize individual performance, skills, experience, and criticality of the position_ Mr. Rebel and Ms. Allen, who left the Company during fiscal 2018 , did not receive pay increases. Annual Incentive Financial Goals JIB Operating EBIT from Continuing Operations (50%) JIB Restaurant Operating Margin (ROM) (30%) Strategic Goals Business Model Transformation (20%), subject to meeting minimum threshold Operating EBIT performance: Refranchising Qdoba sale and separation Organization restructure/G&A targets Capital structure and borrowing capacity Fiscal 2018 Results Annual incentives were paid at 69.1% ofour NEO’s target payout, based on the weighted results below: JIB Operating EBIT performance was above threshold and below target, resulting in 39.0% of target payout for this goal JIB ROM performance was just under target, resulting in 82.0% of target payout for this goal Strategic goals: the Compensation Committee determined 125% of target payout based on the Company's performance against the goals and the achievement of the minimum threshold JIB Operating EBIT goal Long-Term Incentive 34% Stock Options 33% vesting per year over three years, 7 year term 33% Performance Shares (PSUs) Vesting based on PSU goal achievement over three-fiscal year performance period, with 50% holding requirement 33% Restricted Stock Units (RSUs) 25% vesting per year over four years, with 50% holding requirement ROIC Goal (33%) Return on Invested Capital From Operations (ROIC") Sales Goal (67%) Systemwide Sales 2018 Actions For the FY 2018-2020 PSU grant, the Committee set only a Systemwide Sales Growth goal, with the intention to set a second goal, adjusted ROIC from Operations, in November 2018, based on the third fiscal year of the performance period (FY 2020). The two PSU goals are typically weighted equally; however, the Committee applied a different practice in 2018 for the reasons described in CD&A section Vl.c. "Fiscal 2018 Compensation - Long Term Incentive Compensation." For the FY 2016-2018 PSU grant, the Committee certified goal achievement and approved a payout of 72.5% of target PSUs granted based on performance during the three-fiscal year performance period, as described in CD&A section VI.c.

36    JACK IN THE BOX INC.ï   2019 PROXY STATEMENT

  CD&A — I. EXECUTIVE SUMMARY  

c. Fiscal 2018 Targeted Total Direct Compensation Mix

The chart below shows the percentage breakdown of targeted total direct compensation (“TDC”) (consisting of base salary, target annual incentive, and target long-term incentive) for each NEO employed at fiscalyear-end. Target TDC is set within a competitive rangein the form of the median of “Market” compensation based on market data and advice provided by the Committee’s independent consultant (as described in CD&A Section III.a “Compensation Competitive Analysis”).variable at-risk, rather than fixed, compensation. Consistent with our compensation principles and objective of pay for performance alignment, (described in Section II “Compensation Principles and Objectives”), the largest portionproportion of compensationtarget TDC is variable,at-risk pay in the form of annual incentives and long-term incentives including annual incentive, stock options(through equity awards in the form of PSUs and PSUs. InRSUs) that represented 84% of TDC for our CEO and an average of 66% of TDC for our Other NEOs. For fiscal 2018, 61.0%2019, 50% of our CEO’s pay was at risk,long-term incentives were delivered in PSUs and45%-54% 50% were delivered in RSUs — as a result, explicitly at-risk components (annual incentive and PSUs) represented 50% of payTDC for our other NEOs (excluding new CFO Tucker who joined the Companymid-fiscal year).CEO and an average of 44% of TDC for our Other NEOs.

 

 

LOGO

61.0% at-risk Comma CEO Tucker (1) Blankenship Rudolph Melancon Bace Salary Annual Incentive Stock Options PSUs Time-Vested RSUs

LOGOLOGO

                                 

 

 

 (1)

For Mr. Tucker, who was hired in March 2018, the breakdown reflects his prorated base salary and incentive, and a new hire RSU grant in April 2018.

(2)

The targetedtarget TDC does not include (1)excludes a) the conditional bonus for Mr. Melancon or (2) special RSUbonuses awarded to Messrs. Rudolph and Tom, and b) the special retention equity awards made to Dr. BlankenshipMessrs. Tucker and Mr. Rudolph made during 2018 outside our regular compensation program for the circumstancesTom, as described more fully in Sections VI.b “Performance-Based Annual Incentive Compensation (Cash)”section VI.c. and VI.c “Long-Term Incentive Compensation”,VI.d. respectively.

 

CEO - 20182019 Total Direct Compensation

 

For fiscal 2018,2019, the Committee determined that the target TDC for our CEO would be $5.85 million (consisting of base salary of $925,000, target annual incentive of $925,000, and target long-term incentive of $4.0 million), which was approximately 5% belowaligned with the median TDC Market median.“Market” compensation based on market data and advice provided by the Committee’s independent consultant (as described in CD&A Section III.a. “Compensation Competitive Analysis”).

 

  Target   SCT 
  Target   SCT 

Salary

  $925,000   $919,711   $925,000   $925,000 

Annual Incentive

  $925,000   $639,175   $925,000   $1,114,625 

Long-Term Incentive (LTI)

  $4,000,000   $3,358,592   $4,000,000   $3,905,997 

Fiscal 2018 Annual TDC

  $5,850,000   $4,917,478 

Fiscal 2019 Annual TDC

  $5,850,000   $5,945,622 

The SCT column at left shows the CEO’s actualTDC-- as reflected in the “Summary Compensation” (“SCT”) and “Grants of Plan-Based Awards” tables. The difference between Target and SCT compensation is attributable to: (a) on the Annual Incentive, Mr. Comma’s fiscal 20182019 payout amounting to only 69.1%120.5% of target (due to the Company under-performing overallperforming above target performance overall on its goals); and (b) on the LTI: (i) the difference in stock price of the long-term incentive awards between the price on the actual grant date and the earlier60-day average price used by the Committee to establish the number of options, RSUs and PSUs to be granted; and (ii) the SCT use of the grant date fair value for RSU and PSU awards, as described in the footnotes to those tables.

The LTI components are described in detail in proxy Section VI.dVI.d. “Fiscal 20182019 Compensation — Long-Term Incentive Compensation.”

 

 

40JACK IN THE BOX INC.  ï  20192020 PROXY STATEMENT37

 

  CD&A — I. EXECUTIVE SUMMARY  

 

d. CEO Compensation and Pay for Performance Alignment

Each year, the Committee assesses our CEO’s actual compensation relative to the Company’s performance. The following graph shows the relationship of our CEO’s actual TDC (as reflected in the SCT) compared to our cumulative total shareholder return (TSR) performance in each of the last five fiscal years. Actual TDC in this chart includes base salary, actual annual incentive earned for the year, and the long-term incentive value based on the stock price at the time of grant, as detailed in the section immediately above.

As illustrated, pay and performance are generally aligned—aligned — with higher pay in the earlier years and in fiscal 2019 given strong financial and TSR performance, and lower pay when financial performance did not meet goals (in fiscal 2017 and 2018) and TSR declined (in fiscal 2018).

 

LOGO

CEO Pay and 5-Year Cumulative Total Return (1) CEO Compensation (000s) Total Shareholder Return 2016 Special Retention Award (Equity) (2) Long-Term Incentive (Equity) Annual Incentive (cash) Base Salary Jack in the Box TSRLOGO

                                 

 

 

 (1) 

The graph above shows the cumulative return to holders of the Company’s Common Stock at September 30th of each year assuming $100 was invested on September 30, 2013,2014, and assumes reinvestment of dividends. The Company began paying dividends in fiscal 2014.

 
 (2) 

2016 Special Retention Award: In fiscal 2016, the CEO was awarded a special stock award (reflected in the top portion of the FY 2016 bar) to recognize the criticality of his role and the Company’s strong performance under his leadership, and to incentivize him to remain with the Company while providing measured increases to ongoing, target TDC. Thisone-time RSU grant (detailed in our 2017 Proxy Statement) cliff vests 50% four years from the grant date and the remaining 50% five years from grant.

 

e.Say-on-Pay Feedback from Stockholders

In 2018,2019, we sought an advisory vote from our stockholders regarding our executive compensation program and received a 98.2%98.1% favorable vote supporting the program. Each year, the Committee considers the results of the advisory vote as it completes its annual review of each pay element and the compensation provided to our NEOs and other executives. Given the significant level of stockholder support and our stockholder outreach throughout the year, the Committee concluded that our executive compensation program continues to align executive pay with stockholder interests and provides competitive pay that encourages retention and effectively incentivizes performance of talented NEOs and executives. Accordingly, the Committee determined not to make any significant changes to our programs as a result offollowing the vote. The Committee will continue to consider the outcome of oursay-on-pay votes and our stockholders’ views when making future compensation decisions for the NEOs and executives.

 

38JACK IN THE BOX INC.  ï  20192020 PROXY STATEMENT41

 

  CD&A — II. COMPENSATION PRINCIPLES AND OBJECTIVES  

 

II. COMPENSATION PRINCIPLES AND OBJECTIVES

 

The Committee focuses on the following principles and objectives in determining and measuring the various components of our executive compensation programs:

 

Competitive target pay structure, including base salary, annual incentive, and long-term incentives that enable us to attract and retain talented, experienced executives who can deliver successful business performance and drive long-term stockholder value.

 

Pay for performance alignment, with the largest proportion of executive pay in the form of annual and long-term incentives that directly tie payouts, if any, to the achievement of corporate goals and strategies.

 

Comprehensive goal setting, with financial, operational, and/orand strategic performance metrics that drive long-term stockholder value.

 

Incentivizing balanced short-term and long-term executive decision making, through variable compensation components (cash and stock) using varying timeframes.

 

Executive alignment with stockholder interests, through stock ownership and holding requirements that build and maintain an executive’s equity investment in the company.

 

Sound governance practices and principles in plan design and pay decisions, with the Committee considering both what and how performance is achieved.

 

Management of compensation risk, by establishing incentive goals that avoid placing too much emphasis on any one metric or performance time horizon, thereby discouraging excessive or unwise risk-taking.

Internal Pay Equity

Our compensation programs are designed so that potential compensation opportunities are appropriate relative to each executive’s level of responsibility and impact. While program design is similar for executives at the same level, actual pay may vary based on job scope and individual performance over time. In fiscal 2018,2019, our CEO’s targeted TDC was approximately 3.352.23 times higher than the next highest paid executive.

 

42JACK IN THE BOX INC.  ï  20192020 PROXY STATEMENT39

 

  CD&A — III. COMPENSATION COMPETITIVE ANALYSIS  

 

III. COMPENSATION COMPETITIVE ANALYSIS

 

a. Competitive Analysis

 

Each year the Committee relies on multiple data points to assess the competitiveness of our executive compensation program and the individual compensation of our executives. Information the Committee uses to perform this analysis includes:

 

The Company’s performance against its financial and operationalperformance goals;

 

The mix of short-term and long-term compensation in the form of cash and equity-based compensation;

 

A review of “Market” compensation by the Committee’s independent consultant, which includes data from (a) proxy statement disclosures of our Peer Group (described below) and (b) general industry data from national compensation surveys; and

 

The Company’s financial performance relative to our Peer Group.

 

 

b. Fiscal 20182019 Peer Group

 

We useThe Committee reviews and approves a Peer Group to assess thefor use in conducting competitive pay levelsmarket analysis of compensation for our NEOs and other executives, and to evaluate program design elements. TheFollowing fiscal 2018, with Jack in the Box completing its sale of Qdoba and increasing its franchise restaurant mix to 94%, the Committee believesdetermined that the fiscal 2019 Peer Group should consistwould be comprised solely of restaurant companies (rather than a combination of restaurant and retail companies, because these areas in prior years) to better reflect our business and the primary companies withmarket in which we compete for senior executive talent. For 2019, the Committee’s independent consultant recommended removing the seven retail companies that were in the 2018 Peer group and adding seven restaurant companies comparable to Jack in the Box in size.

Our practice in selecting Peer Group companies is to look for companies in the restaurant industry that are generally comparable on an aggregated basis in size (GAAPfor systemwide sales, generally 0.3x to 3.0x Jack in the Box Inc., and for GAAP revenue, market capitalization and systemwide sales) generally between 0.5x and 2.0x0.2x to 5.0x Jack in the Box Inc. The Committee also considers market capitalization, number of locations, business models and consumer focus. In reviewing systemwide sales comparisons, the Committee focuses on the eleven restaurant companies in

The table below shows key financial information of the Peer Group (for which comparative data is applicable). Given the small number of

public restaurant companies that met the above criteria, our Peer Group also included retail companies, using the same criteria described above.

For 2018, the Committee’s independent consultant recommended that no changes be made to the Peer Group. At the time the Committeere-affirmed using the same Peer Group for fiscal 2018, the Peer Group members’ median trailing four-quarter revenue was $2.4 billion and the median market capitalization (as most recently reported) was $2.0 billion, compared with projected Jack in the Box Inc. trailing four-quarter revenue of $1.6 billion and market cap of $2.9 billion. Forat the time the Committee approved the 2019 Peer Group restaurant companies, median systemwide sales (as of their most recently completedin late fiscal year) was $3.8 billion, compared to $4.4 billion projected2018, based on the then-available information for Jack in the Box, Inc. (Jack inand the Box and Qdoba brands.)most recently reported financial information for each peer company at that time.

 

 

20182019 Peer Group

  Company Name

RestaurantRetail

BJ’s Restaurants, Inc.(New)

Bloomin Brands’, Inc.(New)

Bojangles’ Inc.(1)(New)

Brinker International, Inc.

Chico’s FAS Inc.

Buffalo Wild Wings, Inc.(1)

The Children’s Place, Inc.

The Cheesecake Factory Incorporated

DSW Inc.

Chipotle Mexican Grill, Inc.

Express, Inc.

Cracker Barrel Old Country Store, Inc.

The Finish Line, Inc.(1)Denny’s Corporation(New)

Dine Brands Global, Inc.

 

Genesco Inc.

Domino’s Pizza, Inc.

Urban Outfitters,Dunkin’ Brands Group, Inc.(New)

Panera Bread Company(1)

Papa John’s International, Inc.

Red Robin Gourmet Burgers, Inc.(New)

Sonic Corp.(1)

Texas Roadhouse, Inc.(New)

The Cheesecake Factory, Inc.

The Wendy’s Company

  

Systemwide
Sales

GAAP Revenue
(Trailing 4Qtrs)

Market
Capitalization

(As of 4/1/18)

# Locations

(As of 4/1/18)

  Jack in the Box

$3.6MM

(projected)

$853M

(projected)

$2.5MM2,251

  Peer Group Median

$3.4MM$1.6MM$2.0MM1,705

                                 

 

 

 (1)

Subsequent to constructing the Fiscal 20182019 Peer Group, Panera Bread Company was acquired by an investment group led by JAB Holding Company; Buffalo Wild Wings was acquired by Arby’s Restaurant Group; The Finish Line was acquired by JD Sports Fashion Plc;Bojangles’ Inc. and Sonic Corp. waswere acquired by Inspire Brands, Inc.private equity firms, in early 2019 and December 2018 respectively.

 

40JACK IN THE BOX INC.  ï  20192020 PROXY STATEMENT43

 

  CD&A — IV. ELEMENTS OF COMPENSATION  

 

IV. ELEMENTS OF COMPENSATION

 

Our executive compensation programs consist of the elements summarized below, and are designed to (a) achieve our compensation principles and objectives, (b) enable the Company to attract, retain, motivate, engage, and reward our NEOs and other executives, and (c) encourage an appropriate level of risk taking, as discussed later in this CD&A.

 

Element /

Type of Plan

  Link to Compensation Objectives  Key Features

Current Year Performance

  

Base Salary

 

(Cash)

  Fixed compensation amount of compensation for performingday-to-day job responsibilities. Provides financial stability and security.  Competitive pay that is targeted to approximate a reasonable range of the median of the Market, taking into account job scope and complexity, criticality of position, knowledge, skills and experience. Generally, executivesBase salary levels are eligible for an annual salary increase, dependingreviewed annually and may be adjusted if appropriate based on individual performance, market pay changes, and internal equity.

Annual

Incentive

 

(Cash)

  Variable compensation component.compensation. Motivates and rewards for achievement of annual financial and operationalperformance goals and in some years, other annual strategic goals.that drive long-term stockholder value.  Incentives are targeted to approximate a reasonable range of the Market median. Total potential payouts range fromExecutives can earn 0% - 200% of target payout.payout based on achievement ofpre-established performance targets. Goals and weighting are set annually to align with specific financial, operational, and/or strategic performance objectives, andaligned with the Company’s operational plan and budget.Fiscal 20182019 goals are described in Section VI.b.

Multi-Year Performance

  

Long-Term

Incentive (LTI)

 

(Equity)

  

Variable compensation component.compensation. Motivates and rewards for sustained long-term financial and operational performance designed to increase long-term stockholder value.

 

Encourages continued employment through required vesting periods in order to obtain shares.shares of stock.

 

Stock ownership and holding requirements align the financial interests of our executives with the financial interests of our stockholders.

  

LTI guidelines are reviewed annually and set to result in total pay that is within a reasonable range of the Market median. Actual grants may vary from the LTI guideline based on individual performance. No dividends are paid on unvested RSUs or PSUs.

 

Stock Options: Historically represented a portion of the LTI guideline, but no options were granted in fiscal 2019 due principally to the announcement in 2018 that the Company was exploring strategic alternatives.

Performance Shares (PSUs): In fiscal 2018, option awards represented 34% of each executive’s LTI guideline; they vest 33% per year over three years and expire seven years from the grant date. The exercise price is equal to the closing price of Jack in the Box Common Stock on the date of grant.

Performance Shares (PSUs): In fiscal 2018,2019, PSUs represented 33%50% of the LTI guideline; they vest at the end of three years, and are payable in stock, with the amount vesting based upon achievement ofpre-established performance goals (ranging from zero to 150% of the target number of sharesPSUs granted). PSUs are subject to a holding requirement (executives must hold 50% ofafter-tax net shares resulting from the vesting of PSUs until termination of service).The goals for the FY 2018-20202019-2021 grant are described in Section VI.c.VI.d.

 

Restricted Stock Units (RSUs): In fiscal 2018,2019, RSUs represented 33%50% of the LTI guideline, vest 25% per year over four years, and are payable in stock. RSUs are subject to a holding requirement (executives must hold 50% ofafter-tax net shares resulting from the vesting of RSUs until termination of service).

Attraction & Retention

  

Perquisites

 

(Cash)

  Provides a limited cash value for certain other benefits that are typically offered to executives.  A taxable benefit provided to executives and paidbi-weekly. This benefit is intended to assist with each executive’s expenses for financial planning and use of their personal automobile and cell phone for business purposes.purposes, and to assist with financial planning.

Other (2018)(2019)

  

New Hire

Retention Award and Relocation Assistance

(CFO)(Equity)

  Upon joining the Company, the new CFO, Mr.

Messrs. Tucker received a new hire RSU grantand Tom, each hired in April 2018, in recognition of his forfeiture of equity grants and bonus from his prior employment and to provide him an equity stake in the Company prior to the next annual grant in fiscal 2019. The Company also paid relocation expenses associated with Mr. Tucker’s hiring and relocation to San Diego as described in the SCT. A taxgross-up was provided on certain limited expenses consistent with the Company’s relocation policy and approved by the Compensation Committee. This is the only permittedgross-up the Company provides to NEOs or executive officers.

Special Awards Related to Qdoba Sale, Transition & Restructuring

(2 NEOs)

Mr. Rudolph received a specialone-time RSU award to increase their equity stake in the Company in recognition of his critical rolethe criticality of their roles and the importance of retaining each of them in driving activities that culminatedposition. These equity awards are described in the sale of Qdoba. CD&A Section VI.d “2019 Special Equity Awards”

Special Cash Bonuses (Cash) (2 NEOs)

Mr. Melancon was providedRudolph received a conditionalspecial cash bonus in 2018 related torecognition of his significant role in the evaluationexecution of strategic and salefinancing alternatives, specifically the completion of Qdoba and to assure retention through transition and restructuring, as described in CD&A Section VI.b.

Interim COO Compensation

Dr. Blankenshipthe privately placed business securitization transaction. Mr. Tom received a specialone-time RSU award cash bonus in recognition of serving as interim Chief Operating Officer (“COO”) while a search for a COO was underway.

Note: The equity awards for Dr. Blankenshiphis leadership in the development and Mr. Rudolphexecution of an improved communications process with the franchise organization. These bonuses are described more fully in CD&A Section VI.c. “Long-Term Incentive Compensation.”sections VI.c — “Special One-Time Cash Bonuses”.

 

44JACK IN THE BOX INC.  ï  20192020 PROXY STATEMENT41

 

  CD&A — IV. ELEMENTS OF COMPENSATION  

 

Element /

Type of Plan

  Link to Compensation Objectives  Key Features

Retirement

Benefits

 

(Pension, SERP, 401(k) (401(k),  Deferred  Compensation)Compensation,  Pension,  SERP)

  Provides for retirement income to reward service and commitment to the Company and to encourage retention.  

401(k) Plan — The 401(k) Plan is a qualified deferred compensation plan that is available to all employees who are at least age 21. The 401(k) Plan includes a Company matching contribution of up to 4% of compensation deferred by employees, subject to annual IRC limits.

Executive Deferred Compensation Plan (“EDCP”) — The EDCP is anon-qualified deferred compensation plan that is offered to highly-compensated employees. Participants may receive an annual restoration matching contribution if their deferrals to the 401(k) Plan (and related Company matching contributions) are limited due to tax code limits applicable to the 401(k) Plan. A participant must be employed on the last day of the calendar year to receive the restoration matching contribution.

Pension — The Company’s employee pension plan, that provides benefits based on years of service and earnings up to IRC limitations, was closed to employees hired on or after January 1, 2011, and was “sunset” on December 31, 2015 (after which time participants no longer accrue added benefits based on additional pay or service). FourThree NEOs are participants in the plan, excluding Mr. Rebel who retired in May, 2018.pension plan.

Supplemental Executive Retirement Plan (“SERP”) — The SERP was closed to new participants in 2007. Two NEOs (excluding Mr. Rebel who retired in May 2018) who were hired orOne NEO was promoted into an officer position prior to 2007 are participantsand is a participant in the plan. The plan provides retirement income on anon-qualified basis, without regard to IRC limitations.

401(k) Plan — The 401(k) Plan is a qualified deferred compensation plan that is available to all employees who are at least age 21. The 401(k) Plan includes a Company matching contribution of up to 4% of compensation deferred by employees, subject to annual IRC limits.

Executive Deferred Compensation Plan (“EDCP”) — The EDCP is anon-qualified deferred compensation plan that is offered to highly-compensated employees. Since January 1, 2016, participants may receive an annual restoration matching contribution if their deferrals to the 401(k) Plan (and related Company matching contributions) are limited due to tax code limits applicable to the 401(k) Plan. A participant must be employed on the last day of the calendar year to receive the restoration matching contribution. Executives hired or promoted to an Officer position after 2007 through May 7, 2015, and not eligible for the SERP (one NEO in 2018), also receive a limited-time Company contribution to the EDCP, described in CD&A Section VII.c “Additional Compensation Information – Retirement Plans.”

 

42JACK IN THE BOX INC.  ï  20192020 PROXY STATEMENT45

 

  CD&A — V. COMPENSATION DECISION-MAKING PROCESS  

 

V. COMPENSATION DECISION-MAKING PROCESS

 

 

a. Role of the Compensation Committee

The Committee works closely with its independent consultant and meets regularly, including in executive session without members of Managementthe executive team (“Management”) present, to make decisions on our executive compensation program and on the compensation of our CEO and other executives. The Committee reviews a variety of market data and information, including Company, Peer Group, restaurant/retailrestaurant industry, and general industry compensation information, and considers the recommendations of its independent consultant when making compensation decisions. The Committee Chair reports the actions of the Committee to the Board at each regular meeting. The Committee’s responsibilities include reviewing and approving:

 

The Peer Group;

 

Our compensation principles and objectives;

 

The amount and form of executive compensation (pay increases, equity grants);

 

CEO performance and compensation, and executive officer compensation;

 

Annual and long-term incentive plans and benefit plans;

 

Performance metrics and goals, and the achievement of annual and long-term incentive plan goals;

 

Board compensation; and

 

Annual proxy statement/CD&A disclosure.

b. Role of the Independent Compensation Consultant

The Committee has retained Semler Brossy Consulting Group, LLC (“Semler Brossy” or the “Consultant”) as its independent compensation consultant since January 2010. The Consultant reports directly to the Committee and performs no other work for the Company. The Committee has analyzed whether the work of Semler Brossy as a compensation consultant raises any conflict of interest, taking into consideration the following factors: (i) whether Semler Brossy provides any other services to the Company; (ii) the amount of fees paid by the Company to Semler Brossy as a percentage of Semler Brossy’s total revenue; (iii) Semler Brossy’s policies and procedures that are designed to prevent conflicts of interest; (iv) any business or personal relationship of Semler Brossy or the individual compensation advisors employed by the firm with any executive officers of the Company; (v) any business or personal relationship of the individual compensation advisors with any member of the Committee; and (vi) any stock of the Company owned by Semler Brossy or the individual compensation advisors whom it employs. The Committee has determined, based on its

analysis of the above factors, that the work of Semler Brossy

and the individual compensation advisors employed by Semler Brossy as compensation consultants to the Committee has not created any conflict of interest.

The Consultant does the following for the Committee:

 

Attends Committee meetings;

 

Provides independent advice to the Committee on current trends and best practices in compensation design and program alternatives, and advises on plans or practices that may improve effectiveness of our compensation program;

 

Provides and discusses peer group and survey data for competitive comparisons and, based on this information, offers independent recommendations on CEO and NEO compensation;

 

Reviews the CD&A and other compensation-related disclosures in our proxy statements;

 

Offers recommendations, insights and perspectives on compensation related matters;

 

Evaluates and advises the Committee regarding enterprise and related risks associated with executive compensation components, plans and structures; and

 

Assists the Committee in designing executive compensation programs that are competitive and align the interests of our executives with those of our stockholders.

In fiscal 2018,2019, Semler Brossy attended all Committee meetings in person or by telephone, including executive sessions as requested, and consulted frequently with the Committee Chair between meetings.

c. Role of the CEO in Compensation Decisions

When making decisions on executive compensation, the Committee considers input from the Company’s CEO, who reviews the performance of the other NEOs and executives and provides his recommendations to the Committee on NEOs’ and other executives’ compensation. The Company’s Chief of StaffHuman Resources Officer, Compensation and Strategy, compensation and benefits department,Benefits Department, and the CFO and finance departmentFinance Department also provide information and answer the Committee’s questions regarding Company financial targets and projections. The CEO meets privately with the Committee and its Consultant to discuss his executive pay recommendations and provides his insight and perspectives to the Committee on the reports and recommendations of the Committee’s Consultant relating to plan design and strategies, goal setting, payout structure, stock grants and holding requirements, and related topics.

The Committee reviews and discusses pay decisions related to the CEO in executive session without the CEO or any other members of Management present.

 

 

46JACK IN THE BOX INC.  ï  2019 PROXY STATEMENT43

  CD&A — VI. FISCAL 2018 COMPENSATION  

VI.��FISCAL 2018 COMPENSATION

a. Base Salary

In fiscal 2018, the Committee approved the following NEO salary increases (effective December 2017) to maintain market competitiveness, and to recognize individual performance, skills, and criticality of position, utilizing the analysis and methodology described in Section III “Compensation Competitive Analysis.”

2018 Base Salary Increases 
Name  Fiscal 2017 Salary   Fiscal 2018 Salary   % Increase 

Mr. Comma (CEO)

   $900,000    $925,000    2.8% 

Mr. Tucker (CFO)

   N/A    $575,000    N/A 

Dr. Blankenship (CSS)

   $369,000    $378,000    2.4% 

Mr. Rudolph (CLO)

   $512,000    $525,000    2.5% 

Mr. Melancon (SVP)

   $330,000    $338,000    2.4% 
(1)

Mr. Rebel and Ms. Allen, who separated from the Company in 2018, did not receive a pay increase.

b. Performance-Based Annual Incentive Compensation (Cash)

In December 2017, the Committee approved the annual incentive goals for fiscal 2018 consistent with the Company’s fiscal 2018 operational plan and budget approved by the Board. The annual goals were based on: (1) Jack in the Box Operating EBIT(1); (2) Restaurant Operating Margin (ROM)(2), and (3) strategic goals related to the Company’s business model transformation (detailed in the chart at bottom), weighted as follows:

Jack in the Box Operating EBIT

50%

Jack in the Box ROM

30%

Strategic Goals

20%

When setting fiscal 2018 annual incentive goals, the Committee used a rigorous process to set challenging, yet

reasonably attainable goals aimed at ensuring appropriate and competitive levels of payout relative to performance achievement. The process included consideration of: (1) the Company’s fiscal 2018 operational plan and budget that included then-current economic conditions; (2) current and projected performance of the restaurant industry in general and companies within our peer group, and other potential internal and external events that could impact future sales and earnings levels; (3) a sensitivity analysis of Company and brand performance results relative to the incentive targets; and (4) the advice of the Committee’s Consultant. Based on this review, the Committee set goals based on key financial and other metrics that it believed would increase stockholder value if achieved, with target and higher goals set at challenging, yet reasonable levels.

2018 Performance MetricsWhy Goal Is Used

Jack in the Box Operating Earnings Before Interest and Taxes (“Operating EBIT”)(1)

This is a key performance metric for measuring operational performance. In fiscal 2018, the metric excluded gains/losses from refranchising, restructuring costs, and shared services and unallocated costs due to the ongoing process of separating Qdoba and supporting transition services agreements.

Jack in the Box Restaurant Operating Margin (ROM)(2)

ROM measures how effectively the Company manages its business operations and costs, and is a key performance metric for alignment with our franchise operators, our franchising strategy, and our stockholders and potential investors.

Strategic Goals:

1. Jack in the Box Refranchising

2. Sale of Qdoba and transition services agreements

3. Organization restructure and G&A targets

4. Capital Structure and Borrowing Capacity optimization

The strategic goals were critical to the Company achieving its business model transformation to a highly franchised, single brand, asset-light entity, and aligned with the Company’s five-year plan and progress toward such transformation. Each of the goals is intended to improve the financial and operational effectiveness of the Company over the long-term. The Committee determined the level of performance based on a holistic assessment of achievement against each of the goals.

(1)

Operating EBIT is anon-GAAP measure, defined by the Company as earnings before interest and taxes, excluding gains/losses from refranchising, restructuring costs, and shared services and unallocated costs. For a reconciliation of this measure to net earnings, the most comparable GAAP measure, see Appendix A.

(2)

As set forth in Note 1 in the Proxy Summary, ROM is anon-GAAP measure. For a reconciliation of this measure to the most comparable GAAP measure, please refer to Appendix A.

44    JACK IN THE BOX INC.ï   20192020 PROXY STATEMENT

    

 

  CD&A — VI. FISCAL 20182019 COMPENSATION  

 

VI. FISCAL 2019 COMPENSATION

a. Base Salary

For fiscal 2019, following a review of total direct compensation relative to competitive market data of our Compensation Peer Group, and consideration that the Company was in the midst of its restructuring as a single brand and its evaluation of strategic alternatives, the Committee determined not to make any changes to the base salaries of our NEOs.

Name  Salary FYE 2018   Salary FYE 2019   % Increase 

Mr. Comma (CEO)

   $925,000    $925,000    0.0% 

Mr. Tucker (CFO)

   $575,000    $575,000    0.0% 

Dr. Blankenship (CSS)

   $378,000    $378,000    0.0% 

Mr. Rudolph (CLO)

   $525,000    $525,000    0.0% 

Mr. Tom (COO)

   $325,000    $325,000    0.0% 

b. Performance-Based Annual Incentive Compensation (Cash)

In November 2018, the Committee approved the annual incentive goals for fiscal 2019 consistent with the Company’s fiscal 2019 operational plan and budget approved by the Board. The annual goals were based on: (1) Operating EBIT and, (2) Restaurant Level Margin, weighted as follows:

Operating EBIT(1)

70%

Restaurant Level Margin(2)

30%

When setting fiscal 2019 annual incentive goals, the Committee used a rigorous process to set challenging, yet reasonably attainable goals aimed at ensuring appropriate and competitive levels of payout relative to performance

achievement. The process included consideration of: (1) the Company’s fiscal 2019 operational plan and budget that included then-current economic conditions; (2) current and projected performance of the restaurant industry in general and companies within our Peer Group, and other potential internal and external events that could impact future sales and earnings levels; (3) a sensitivity analysis of performance results relative to the incentive targets; and (4) the advice of the Committee’s Consultant. Based on this review, the Committee set goals based on key financial metrics that it believed would increase stockholder value if achieved, with target and higher goals set at challenging, yet reasonable levels.

2019 Performance MetricsWhy Goal Is Used

Operating EBIT (1)

This is a key performance metric for measuring operational performance. In fiscal 2019, the metric excluded gains or losses from the sale of company operated restaurants, restructuring costs, and earnings or losses from discontinued operations.

Restaurant Level Margin (2)

Restaurant Level Margin measures how effectively the Company manages its business operations and costs and is a key performance metric for alignment with our franchise operators, our franchising strategy, and our stockholders and potential investors.

(1)

Operating EBIT is a non-GAAP measure, defined by the Company as earnings net before interest expense, net and income taxes, excluding gains or losses on the sale of company operated restaurants, restructuring costs, and earnings or losses from discontinued operations. See Appendix A — Reconciliation of non-GAAP measurements to GAAP Results.

(2)

As set forth in Note 5 in the Proxy Summary, Restaurant Level Margin is anon-GAAP measure. For a reconciliation of this measure to the most comparable GAAP measure, see Appendix A.

JACK IN THE BOX INC.ï  2020 PROXY STATEMENT47

  CD&A — VI. FISCAL 2019 COMPENSATION  

Fiscal 20182019 Performance Results

The Company performed above threshold but below target for each fiscal 2018 financial goal: Jack in the Box Operating EBIT ($270.2 million) at a payout of 39% of target, and Jack in the Box ROM (22.7%) at a payout of 82% of target asAs shown on the chart below.

LOGO

Annual incentive Financial Goals JIBbelow, relative to the Company’s fiscal 2019 Operating EBIT JIB ROM Jackgoal (weighted 70%), performance achievement ($207.8 million) was between target and maximum goal, resulting in the Box Operating EBIT Jack in the Box ROM

On the strategic goals, the Committee evaluated the Company’s achievements and determined a payout of 125%149% of target; and, for Restaurant Level Margin (weighted 30%), the performance achievement ($88.3 million) was between threshold and target, resulting in a payout of 54% of target. Considerations included the followingThe overall weighted payout for each goal:both financial goals was 120.5% of target.

 

1.

Refranchising: progressing from 88% to 94% franchise-operated during 2018;

 

2.

Qdoba separation: successfully closing the sale of Qdoba and executing transition services agreements to facilitate the complete separation of Qdoba from Jack in the Box;

LOGO

 

3.

Organization structure and G&A targets: identifying and beginning implementation of G&A restructuring that delivers on the company’s long-term plan to reduce G&A to 1.9% of systemwide sales by 2021 (G&A was reduced from 2.4% of systemwide sales in fiscal 2017 to 2.2% in fiscal 2018); and

4.

Capital structure and borrowing capacity: hitting key milestones toward ultimately increasing the Company’s leverage to 5.0 times EBITDA.

    

Fiscal 20182019 Payouts

The 20182019 target and maximum annual incentive payout percentages for NEOs, that received a 2018 incentive payout, expressed as a percentage of annual base salary, are shown in the table below. The target potential payout percentages are set by position level, taking into account the compensation competitive analysis described in Section III.a. and each executive’s role in the Company. There were no changes in the 2019 target payout percentages from those in fiscal 2018. There is no minimum amount of incentive payout guaranteed for the NEOs, but the maximum amount is capped at 2x target payout (which is 200% of salary for the CEO, 150% of salary for Messrs. Tucker, Rebel, Rudolph, and Dr. Blankenship, and 110%90% for Mr. Melancon)Tom). The payouts as a percent of target incentive and as a percent of annual salary are shown below.

 

   Potential Payout
(As Percent of Annual Salary)		    

Target

Incentive (1)

   

Actual Payout

(As Percent of

Target Payout)

  

Actual Payout
(As Percent of
Annualized

Salary)

  

Actual Incentive

Payout

 
   Target           Max    

Mr. Comma (CEO)

  100%  200%     $925,000    69.1%   69.1%   $639,175 

Mr. Tucker (CFO)

     75%  150%     $199,038    69.1%   23.9%   $137,536 

Mr. Rebel (Former CFO)

     75%  150%     $227,769    69.1%   27.9%   $157,389 

Dr. Blankenship (CSS)

     75%  150%     $283,500    69.1%   51.8%   $195,899 

Mr. Rudolph (CLO)

     75%  150%     $393,750    69.1%   51.8%   $272,081 

Mr. Melancon (SVP)

     55%  110%     $185,900    69.1%   38.0%   $128,457 

Ms. Allen (JIB President)(2)

     75%  150%     $386,250    0.0%   0.0%   $           0 
(1)

Represents prorated amount for Mr. Tucker based on his March 2018 hire date, and for Mr. Rebel based on his separation from the Company in May 2018.

(2)

Ms. Allen did not receive a payout for 2018 due to her separation from the Company in February 2018.

   Potential Payout
(As Percent of Annual Salary)		    

Target

Incentive

   

Actual Payout

(As Percent of

Target Payout)

  

Actual Payout
(As Percent of
Annualized

Salary)

  

Actual Incentive

Payout

 
  

 

  Target           Max    

Mr. Comma (CEO)

  100%  200%     $925,000    120.5%   120.5%   $1,114,625 

Mr. Tucker (CFO)

     75%  150%     $431,250    120.5%   91.0%   $   519,665 

Dr. Blankenship (CSS)

     75%  150%     $283,500    120.5%   91.0%   $   341,618 

Mr. Rudolph (CLO)

     75%  150%     $393,750    120.5%   91.0%   $   474,469 

Mr. Tom (COO)

     45%     90%     $146,250    120.5%   55.0%   $   176,231 

Qdoba Sale Related Bonusc. SpecialOne-Time Cash Bonuses

 

Mr. Melancon was providedRudolph received aone-time conditional special $50,000 bonus of $200,000 in 2018September 2019 for taking on significant additional responsibilities related to the evaluationexecution of Qdoba strategic and financing alternatives, and to assure his continued employment through any potential sale or dispositionspecifically the completion of the Qdobaprivately placed business and related transition and restructuring activities. Thissecuritization transaction. The Committee determined the amount of his bonus, equal to 60%9.5% of his base salary, was determinedin its discretion and in consultation with the Committee’sits independent consultantcompensation consultant. Mr. Tom received a special

$10,000 cash bonus in September 2019, equal to 3% of his base salary, for his leadership in the development and setexecution of an improved communications process intended to reflect an amount commensuratebuild stronger relationships with the scope and additional time and effort required. The bonus was earned and paidfranchise organization. Neither of these bonuses were grossed up, in two equal installments,accordance with Company policy prohibiting tax gross-ups to Executive Officers except for relocation expenses where approved by the first in November 2017 following the significant efforts of Mr. Melancon in the sale due diligence process, and the second in April 2018 based on Mr. Melancon’s continued employment though such date and satisfactory coordination of the Qdoba transition services.Compensation Committee.

 

 

48JACK IN THE BOX INC.  ï  20192020 PROXY STATEMENT45

  CD&A — VI. FISCAL 2018 COMPENSATION  

    

  CD&A — VI. FISCAL 2019 COMPENSATION  

 

c.d. Long-Term Incentive Compensation

 

In fiscal 2018,2019, the LTI program for all our Company NEOs was comprised of 34% stock options, 33%50% performance shares (“PSUs”), and 33%50% restricted stock units (“RSUs”). TheAs explained in section “IV. Elements of Compensation”, we did not grant stock options in fiscal 2019 due to the additional trading volatility resulting from the company’s potential sale. For fiscal 2019, the Committee chose these forms of equity awardsto equally weight PSUs and weightings toRSUs because (a) provide options which align executive pay with the creation of value for our stockholders through stock price appreciation, (b) provide PSUs that directly link executive pay to achievement of longer-term Company financial and operational goals, and (c) provide time-vested(b) RSUs tovest over time and facilitate stock ownership and retention. Equity awards were not granted to Mr. Rebel or Ms. Allen who separated from the Company in fiscal 2018.

Each year, the Committee’s Consultant advises the Committee on the LTI grant guidelines that reflect approximately the median of Market TDC when combined with base salary and the target annual incentive. For the fiscal 20182019 grant, the Committee considereddetermined the amount of each NEO’s LTI grant, in its discretion, taking into consideration the equity grant guidelines, the Company’s overall performance, recommendations from the CEO (except with regard to his own compensation), and input from the Consultant to determine the actual grant value for each NEO.its Consultant. The chart below illustrates our LTI structure and the key elements of each type of award granted to our NEOs and other executives for fiscal 2018.2019.

 

 

LOGO

Vests at the end of the 3-fiscal year period based on goal achievement and settled in stock: beginning fiscal2016. 50% of after-tax net shares subject to stock holding requirement. Two performance metrics: ROIC from Operations (33%)- Measures efficient use of capital on adjusted ROIC from Operations for the third fiscal year of the performance period. - Systemwide Sales Growth (67%)- Three annual goals set at the beginning of each fiscal year: measures grov.1h in sales of all company and franchise restaurants. 4-year vesting. 25% per year and settled in stock; 50% of after-tax net shares subject to stock holding requirement 3-year vesting, 33% per year, and 7-year term. Exercise price is equal to the closing price of Jack in the Box Common Stock on the date of grant. Vests at the end of the 3-fiscal year period based on goal achievement and settled in stock: beginning fiscal2016. 50% of after-tax net shares subject to stock holding requirement. Two performance metrics: ROIC from Operations (33%)- Measures efficient use of capital on adjusted ROIC from Operations for the third fiscal year of the performance period. - Systemwide Sales Growth (67%)- Three annual goals set at the beginning of each fiscal year: measures growth in sales of all company and franchise restaurants. 4-year vesting. 25% per year and settled in stock; 50% of after-tax net shares subject to stock holding requirement 3-year vesting, 33% per year, and 7-year term. Exercise price is equal to the closing price of Jack in the Box Common Stock on the date of grant.LOGO

 

46JACK IN THE BOX INC.  ï  20192020 PROXY STATEMENT49

  CD&A — VI. FISCAL 2019 COMPENSATION  

    

  CD&A — VI. FISCAL 2018 COMPENSATION  

 

Performance Shares (PSUs)

 

PSUs are granted annually, and vest after three years based on achievement of performance metrics that are established for the three-fiscal year performance period (“Performance Period”). The Committee sets specific performance goals (including minimum,threshold, target, and maximum) either (a) at the beginning of the Performance Period, or (b) annually at the beginning of each fiscal year of the Performance Period, depending on the goal; in the latter case, the threshold performance goals set for the second and third years of the Performance Period generally may not be lower than the threshold set for the first year. The Committee believes that for some metrics, setting annual performance goals improves its visibility into the relative attainability and difficulty of the goals and, as a result, better aligns performance and payouts. Vesting ranges from 0% to 150% of the target number of shares granted; the threshold payout (50% of target) requires achieving an established minimum performance requirement (there is no payout if performance doesn’t meet the minimum requirement).

PSUs Granted in Fiscal 20182019: In November 2017,2018, the Committee granted PSU awards to our NEOs and executives for the fiscal 2018-2020three-fiscal-year 2019-2021 Performance Period. Typically, theThe PSU grants are based on two equally-weighted metrics: (a) adjusted ROIC from Operations and (b) Systemwide Sales Growth, with the Committee setting the three-year ROIC goal at the beginning of the three-year performance period and setting each annual systemwide sales goal at the beginning of each fiscal year. However, in November 2017, the Committee set only a systemwide sales goal for the first year. The Committee believed this was necessary due to the Company having just entered into an agreement to sell Qdoba and not yet having certainty the deal would close, which impacted the Committee’s ability to set an appropriate forward-looking ROIC goal until— if and when— the deal closed.

The following year, in November 2018, the Committee set an ROIC goal for the remainder of the performance period,

(measured at FYE 2020), weighted 33% for the entire3-year grant). At that time, the Committee also followed its standard practice of setting the second year annual sales goal. The remaining fiscal 2020 sales goal will be set at the beginning of fiscal 2020.

These two metrics, systemwide sales and ROIC, support the critical drivers of our success: growingtop-line profitable sales, and encouraging prudent deployment of capital to drive the business. For each metric, the Committee believes the goals set are appropriately challenging, yet reasonably attainable. The actual goals are not being disclosed before the end of the Performance Period because we believe such disclosure would be competitively harmful.

PSUs Vested in 20182019: PSUs granted in November 20152016 (based on the three-year fiscal 2016-2018three-fiscal-year 2017-2019 Performance Period) vested and were payable in November 2018. Consistent with our pay for performance philosophy, the payout level was determined2019 based on the averageachievement of (a)two equally-weighted metrics, Systemwide Sales and ROIC, as follows:

Systemwide Sales

The PSU payout level for Systemwide Sales (50% of the target number of shares) was determined as the average performance level attained in each fiscal year of the Performance Period forand included both the Systemwide Sales measure (bothJack in the Box and Qdoba brands in 20162017 and 2017, andonly the Jack in the Box brand only in 2018 weighted 50%) and (b)2019. The threshold, target, and maximum Systemwide Sales goals were established at the beginning of each fiscal year. The threshold, target, and maximum goals were:

Fiscal 2017 — $4.288 billion, $4.502 billion, and $4.581 billion, respectively

Fiscal 2018 — $3.469 billion, $3.558 billion, and $3.645 billion, respectively

Fiscal 2019 — $3.466 billion, $3.566 billion, and $3.659 billion, respectively.

Actual Systemwide Sales achievement was $4.2912 billion for fiscal 2017, $3.4661 billion for fiscal 2018, and $3.5047 billion for fiscal 2019, resulting in an average payout of 40% for the Systemwide Sales portion of the award.

ROIC

The PSU payout level for ROIC (50% of the target number of shares) was determined as the performance level attained onin fiscal 2019, the ROIC measure setthird year of the Performance Period. The threshold, target and maximum goals were established at the beginning of the three-year fiscal Performance Period for fiscal 2018, the third year of the Performance Period (weighted 50%).The(in November 2016). The threshold, target, and maximum goals weightingwere 18.2%, 21.4%, and 24.5%, respectively.

Actual ROIC achievement for fiscal 2019 was 30.9%, exceeding the maximum goal and resulting in a payout are shown on the chart below. The achievement level onof 150% of the ROIC from Operations goal was just aboveportion of the target ROIC goal of 16.0% (or 104.3% of target). Achievement on the Systemwide Sales goal was above threshold but below target in each of fiscal 2016award.

PSU Vesting and 2017, and below threshold in fiscal 2018 (resulting in an average achievement level of 20.4% on the sales goals). Payout for Fiscal 2019

Together, thisthese outcomes resulted in a weighted payout of 72.5%95.0% of the target number of PSUs granted to NEOs employed for the full Performance Period.

 

 

Fiscal 2016-2018 PSU Goals and Performance

  Performance  

Period

 Approved Measures Weight    Goal  FY16
Actual		  FY17
Actual		  FY18
Actual		 
 Threshold    Target    Maximum   
2016-2018 ROIC from Ops (at FYE2018)  50%   15.5%   16.0%   19.5%           16.3% 
2016 Systemwide Sale  50%  $4,201.0  $4,502.0  $4,610.0  $4,330.2    
2017 ($ in billions)  $4,288.0  $4,502.0  $4,581.0   $4,291.2   
2018       $3,469.0  $3,558.0  $3,645.0          $3,466.1 
 Payout    %

 

  50.0%   100.0%   150.0%    

Grant Date Vesting Period Performance Period Goal Approved Measures Weight Threshold Target Maximum FY16 Actual FY17 Actual FY18 Actual ROIC from Ops (at FYE2018) 50% 15.5% 16.0% 19.5% 16.3% 2016-2018 11/2412015 2016-2018 2016 Consolidated Systemwide Sales (All Restaurants} 50% $4,201.0 S4,50 2.0 $4,610.0 $4,330.2 2017 ($ in billions} $4,288.0 S4,50 2.0 $4,581.0 $4,291.2 2018 $3,469.0 $3,558.0 $3,645.0 $3,466.1 Payout % 50.0% 100.0% 150.0%

The “Grants of Plan-Based Awards” table shows the LTI awards granted to NEOs in fiscal 2018.

50JACK IN THE BOX INC.  ï  20192020 PROXY STATEMENT47

  CD&A — VI. FISCAL 2018 COMPENSATION  

    

  CD&A — VI. FISCAL 2019 COMPENSATION  

 

20182019 Special Equity Awards

 

DuringIn November 2018 when annual equity grants were determined (for fiscal 2019), the Company was in the midst of its evaluation of strategic alternatives, including a potential sale. The Committee recognized that the two NEOs hired in 2018, Mr. Tucker (CFO) and Mr. Tom (COO), had a limited equity stake in the Company and that their services were critical to the ongoing operations of the business and our ability to execute on anticipated potential strategic alternatives. To retain and incentivize these NEOs, the Committee approved special equity awards for three NEOs(“Retention RSUs”) as described below, with each grant and amount determined in consultation with the Committee’s independent consultant:

To new CFO, Mr. Tucker, who joined the Companymid-year, a grant of 4,486 RSUs in recognition of his forfeiture of equity grants and bonus from his prior employment, and to provide him an equity stake in the Company prior to the next annual grant in fiscal 2019. The Committee determined the RSU grant was necessary and appropriate to induce Mr. Tucker to join the Company (giving consideration to, among other things, Market compensation, his experience and the compensation he

would be foregoing at his prior employment) and retain and incentivize Mr. Tucker in his critical role as CFO.

To CSS Dr. Blankenship, aone-time grant of stock valued at $200,000 (2,110RSUs with a target value equal to one times his LTI value of $825,000 (10,023 RSUs) in recognition of serving as interim Chief Operating Officer (“COO”) while a search for a COO was underway, granted February 27, 2018..

 

To CLOCOO, Mr. Rudolph,Tom, aone-time grant of stock valued at $200,000 (2,215RSUs with a target value equal to one times his base salary of $325,000 (3,948 RSUs) in recognition of his critical role in driving the activities that culminated in the sale of Qdoba, granted March 23, 2018..

Each of the special equity awards vests over three years subject to the NEO’s continued service with the company. The actual grant date fair value and isother terms of the special equity awards are detailed in the “Grants of Plan-Based Awards” table.

 

 

d.e. Cash Perquisite Allowance

 

Executives receive an annual cash perquisite allowance, which was instituted in 2011, and has not increased since 2011, to replace reimbursements under the prior executive medical reimbursement program and to consolidate multiple allowances (in addition to eliminating administrative expenses to the Company). This limited benefit is intended to contribute toprovide assistance towards the executive’s financial planning expenses, andin the amount the Committee has determined is appropriate, for expenses related to use of their personal automobile and cell phone for business purposes, and hasfinancial planning. However, the perquisite allowance may be used in any manner the executive chooses and the Company does not increased since 2011.require to the executive to disclose how they have used the allowance. The annualized allowance, shown in the following table, is paidbi-weekly and is taxable to each executive, with no taxgross-up. NEOs employed for less than a full fiscal year

receive a prorated portion of the allowance based on the time of employment with the Company during fiscal 2018.2019.

 

Name  Annualized Allowance 

Mr. Comma (CEO)

   $66,500 

Mr. Tucker (CFO)

   $52,000 

Mr. Rebel (Former CFO)

$52,000

Dr. Blankenship (CSS)

   $52,000 

Mr. Rudolph (CLO)

   $52,000 

Mr. Melancon (SVP)Tom (COO)

   $45,700

Ms. Allen (Former JIB President)

$52,00024,600 
 

 

48JACK IN THE BOX INC.  ï  20192020 PROXY STATEMENT51

 

  CD&A — VII. ADDITIONAL COMPENSATION INFORMATION  

 

VII. ADDITIONAL COMPENSATION INFORMATION

 

a. Executive Stock Ownership and Holding Requirements

 

Our senior vice presidents and higher, including four of our NEOs, are subject to stock ownership guidelines. The guidelines are intended to assure that these executives maintain a meaningful financial stake in the Company in order to promote a long-term perspective in managing the business, and to align their long-term financial interests with those of our stockholders. Our stock ownership guidelines consist of (1) an ownership requirement set as a multiple of salary and (2) a holding requirement.

1.Stock Ownership Guideline

 

Position  Minimum Ownership
(base salary multiple)		 

Chairman and CEO

   5.0x 

Executive Vice President

   3.0x 

Senior Vice President

   1.5x 

2.Holding Requirements

Executives are required to hold until termination of service 50% ofafter-tax net shares resulting from the vesting of RSUs and PSUs.

 

 

NEO Stock Ownership

Each year, the Committee reviews our NEOs’ stock ownership relative to their respective requirement, with new executives expected to meet their ownership requirement within five years from the date they became subject to the requirement. Each of our continuing NEOs, exceptexcluding Mr. Melancon,Tom who was not subject to a stock ownership requirement in fiscal 2019, is currently in compliance with (or within the transition period for meeting) the stock ownership guidelines, as of September 30, 2018.29, 2019.

 

Name  Shares
Directly
Held		   Restricted
Stock/
Unvested
Shares (1)		   Total
Shares		   Value at 9/30/18
@ $83.83		   

Stock
Ownership

Requirement
(000s)

   Meets
Requirement		  Shares
Directly
Held		  Restricted
Stock/
Unvested
Shares (1)		  Total
Shares		  Value at 9/29/19
@ $90.45		  Stock
Ownership
Requirement
(000s)		  Meets
Requirement

Mr. Comma (CEO)

   59,796    126,227    186,023    $15,594,308    $4,625,000   Yes    48,901    134,651    183,552   $16,602,278   $4,625,000                Yes

Mr. Tucker (CFO)

   0    4,486    4,486    $     376,061    $1,725,000   No (2)    979    18,025    19,004   $  1,718,912   $1,725,000    No (2) 

Dr. Blankenship (CSS)

   19,360    7,363    26,723    $  2,240,189    $1,134,000   Yes    14,799    7,298    22,097   $  1,998,674   $1,134,000    Yes

Mr. Rudolph (CLO)

   28,345    69,784    98,129    $  8,226,154    $1,575,000   Yes    21,007    70,350    91,357   $  8,263,241   $1,575,000    Yes

Mr. Melancon (SVP)

   2,686    2,316    5,002    $     419,318    $   507,000   No (2)

Mr. Tom (COO)

    102    5,684    5,786   $     523,344    N/A    N/A 
(1) 

This column includes restricted shares and unvested RSUs; and for Mr. Comma, also includes deferred performance vested restricted stock. Unvested PSUs and unvested or unexercised options do not count toward meeting ownership guidelines. Mr. Rebel and Ms. Allen separated from the Company during 2018.

(2)

Mr. Tucker is just under his ownership requirement and is still within his transition period for compliance with the ownership requirement; Mr. Melancon had previously met his ownership requirement but fell below as a result of a later decrease in the stock price. In accordance with the Company’s practice, Mr. Melancon will not be permitted to sell shares of Company stock unless and until he meets his ownership requirement.compliance.

b. Executive Benefits

 

Our NEOs and other executives receive the same benefits as those generally available to other employees in the Company. Both Company-subsidized and voluntary benefit programs are provided and include medical, dental, vision, life insurance,

and disability coverage. Additionally, the Company provides each NEO with an enhanced level of employer-paid term life insurance with a value for each NEO of $770,000.

 

 

52JACK IN THE BOX INC.  ï  20192020 PROXY STATEMENT49

 

  CD&A — VII. ADDITIONAL COMPENSATION INFORMATION  

 

c. Retirement Plans

 

The Company’s retirement plans are designed to provide our employees, including our NEOs and other executives, with some retirement income security. These plans reward for service and provide an additional incentive for our employees to build long-term careers at Jack in the Box.

 

Defined Benefit Pension Plan (“Retirement Plan”). All employees hired before 2011 (including fivethree of our NEOs) are participants in atax-qualified defined benefit pension plan. This plan was closed to new employees hired on or after January 1, 2011, and “sunset” on December 31, 2015. This means that participants no longer accrue additional benefits based on additional pay and service as of that date. Participants may begin receiving their accrued benefit on or after retirement.

 

Supplemental Executive Retirement Plan (“SERP”). The SERP is unfunded and not qualified for tax purposes. The SERP was established in 1990 to address IRC limitations on pension benefits that could be accrued under ourtax-qualified pension plan. Effective January 1, 2007, the SERP was closed to new participants. ThreeOne of our NEOs are participantsis a participant in the SERP.

 

Qualified 401(k) Plan (“401(k) Plan”).The 401(k) Plan is a qualified defined contribution plan the 401(k) Plan, is available to all Company employees, and offers employeesemployees. Employees who participate in the plan by deferringcan defer eligible compensation and receive a Company matching contribution equal to 100% of the first four percent of compensation deferred, with immediate vesting. Our NEOs became eligible to defer base salary and annual incentive compensation through the 401(k) Plan beginning effective January 1, 2016 (prior to that time, our executive officers and other highly compensated employees were excluded from participating). All of our NEOs participated in the 401(k) Plan during fiscal 2018.

vesting. Our NEOs became eligible to defer base salary and annual incentive compensation through the 401(k) Plan beginning January 1, 2016 (prior to that time, our executive officers and other highly compensated employees were excluded from participating). All of our NEOs participated in the 401(k) Plan during fiscal 2019.

Non-Qualified Deferred Compensation Plan (“EDCP”). In light of IRC limits imposed on the 401(k) Plan, we sponsor the EDCP into whichwhereby our executive officers and other highly compensated employees may also defer up to 50% of their base salary and up to 85% of their annual incentive compensation. In coordination with the 401(k) Plan changes that took effect January 1, 2016, the EDCP Company matching contribution (previously 100% of the first three percent of compensation deferred) was replaced with a “restoration matching contribution.” This means the Company will match up to the full four percent potential matching contribution forFor participants whose compensation or deferrals to the 401(k) Plan (and related Company matching contributions) are limited due to the IRC limits applicable to the 401(k) Plan.Plan, the Company provides a “restoration matching contribution” to the EDCP of up to the first four percent of compensation deferred (as described in the 401(k) Plan). A participant must be employed on the last day of the calendar year to receive the restoration matching contribution, which is then 100% vested. Company matching contributions made prior to January 1, 2016 vested at a rate of 25% per year (such that the match fully vests after completion of four full years of service with the Company). Participants choose from an array of investment options, and their accounts are credited based upon the performance of the investment options. These obligations under the EDCP represent an unsecured claim against the Company. All of our NEOs, except Mr. Tucker,Tom, participated in the EDCP during 2018.

Enhanced EDCP. Due to the closure of the SERP in 2007, employees hired or promoted into a Corporate Vice President position or above between January 1, 2007 and May 7, 2015 receive a supplemental contribution to their EDCP account of four percent of base salary and annual incentive each year for up to ten years. During fiscal 2018, two of our NEOs, received the enhanced EDCP.2019.

 

 

d. Prohibition of Pledging and Hedging Transactions

 

The Company prohibits directors and Section 16 officers from engaging in certain derivative transactions in Company stock that hedge or offset, or are designed to hedge or offset, any decrease in the market value of equity securities granted as compensation to, or held directly or indirectly by, the employee or director, including:

 

Trading in “puts”, “calls”, or other derivative vehicles involving the Company’s securities (often referred to as hedging transactions);

Engaging inzero-cost collars, forward sales contracts or other hedging transactions in Company securities;

 

Holding Company securities in margin accounts; or

 

Pledging Company securities.

 

 

50JACK IN THE BOX INC.  ï  20192020 PROXY STATEMENT53

 

  CD&A — VII. ADDITIONAL COMPENSATION INFORMATION  

 

e. Executive Compensation Recovery (“Clawback”) Policy

 

The Company’s compensation recovery policy provides that in the event Jack in the Box Inc. materially restates all or a portion of its financial statements due to fraud or intentional misconduct, either committed by a Corporate Officer or knowingly permitted by a Corporate Officer, the Committee may take action to recover incentive cash compensation and performance-based equity awards that were based on the achievement of financial results that were subsequently restated. For purposes of this policy, a Corporate Officer is defined as an employee with the title of Corporate Vice President or above, as well as former Corporate Officers who were employed by the Company at the time of any fraud or intentional misconduct.

Executive compensation subject to recovery and/or cancellation may include:

 

i)

Annual incentive or incentive cash compensation paid to the Corporate Officer, plus a reasonable rate of interest,

 

ii)

Economic gains realized from the sale of shares awarded under a performance-based equity plan, and

 

iii)

Restricted stock or units (PSUs, RSUs), deferred stock awards or units, and outstanding stock options to the extent vesting of such awards is performance-based.

The Committee has the sole discretion to determine what action to take in the event of a restatement, including soliciting recommendations from the Audit Committee and the full Board and retaining outside advisors to assist in making its determinations. Any actions taken by the Committee would be independent of consequences imposed by law enforcement agencies, regulators or other authorities.

Since November 2015, all PSU grant agreements contain specific terms providing that the award is subject to recoupment in accordance with any clawback policy that the Company adopts pursuant to the listing standards of any national securities exchange or association on which the Company’s securities are listed or as is otherwise required by the Dodd-Frank Act or other applicable law. The Committee will continue to review potential changes to its policies, as appropriate in light of the Dodd-Frank Act final regulations.

 

 

f. Termination of Service

 

None of the 20182019 NEOs have (or had during fiscal 2018)2019) employment agreements that provide for benefits upon termination of service, except (a) in the event of a change in control (“CIC”) as described in the “Compensation and Benefits Assurance Agreements”Agreements” discussion in the next section;section. However, the Committee approved certain severance benefits payable to Dr. Blankenship and (b) former JIB President Ms. Allen’s 2014 employment offer letter providing for one year’s base pay on termination. InMr. Rudolph in connection with Ms. Allen’s 2018their actual or anticipated restructure-related separation from service with the Company in January and the elimination of the JIB President role due to the restructuring of the business following the planned sale of Qdoba, and in exchange for providing a general release of claims, she received the offer letter one year’s pay, and an additional cash payment representing the value of one year of COBRA medical premiums and cancelled equity awards that would have vested in 2018 and 2019.February 2020, respectively. These benefits are described in the SCT and “Potential Payments on Termination of Employment or Change in Control” section.

When an NEO terminates employment with the Company, the NEO will receive amounts according to the specific terms and provisions of each compensation plan or benefit plan in which he or she participates. Such amounts may include:

 

Amounts contributed to and distributed under the Company’s qualified andnon-qualified deferred compensation plans (subject to the specific terms and requirements of IRC Section 409A).

 

Under the Company’s equity incentive plan and standard equity agreements, upon a CIC: (a) vesting of PSUs based on actual levels achieved for completed performance periods and target level for incomplete periods, and (b) accelerated vesting of RSUs and options only upon both a qualified CIC and qualifying termination, as described in the “Compensation & Benefits Assurance Agreements” section below.

(b) accelerated vesting of RSUs and options only upon both a qualified CIC and qualifying termination, as described in the “Compensation & Benefits Assurance Agreements” section below.

Amounts accrued and vested in the Company’s pension plans (Retirement Plan for fivethree NEOs; plus, the SERP for Dr. Blankenship and Messrs. Rebel and Melancon only)Blankenship).

 

If termination is after the end of the fiscal year but before payment, the annual cash incentive award, subject to the Company’s achievement of performance goals.

If eligible to retire under a Company-sponsored retirement plan, in addition to the above, and consistent with the terms of our standard equity agreement, Corporate Officers (including all NEOs) are entitled to the following:

 

Accelerated vesting of options equal to 5% additional vesting for each full year of service with the Company.

 

In accordance with the vesting schedule of each award, prorated vesting of PSUs; and, full vesting of time-vested RSUs granted in fiscal 20182019 and earlier.

 

A prorated annual cash incentive award based on the number of full reporting periods worked in the fiscal year before retirement, subject to the Company’s eligibility requirements and achievement of performance goals.

If an NEO dies while employed by the Company, under the terms of the respective stock award agreements, all outstanding options and stock awards will become 100% vested on the date of his or her death (in the case of PSUs,

JACK IN THE BOX INC.ï  2019 PROXY STATEMENT51

  CD&A — VII. ADDITIONAL COMPENSATION INFORMATION  

subject to the number of periods completed during the performance period and actual performance achieved).The. The values of additional potential payments to the NEOs are

provided in the section entitled “Potential Payments on Termination of Employment or Change in Control” of this Proxy Statement.

 

54    JACK IN THE BOX INC.ï  2020 PROXY STATEMENT

  CD&A — VII. ADDITIONAL COMPENSATION INFORMATION  

 

g. Compensation & Benefits Assurance (Change in Control) Agreements

 

The Committee believes that Compensation & Benefits Assurance Agreements (otherwise known as a Change in Control or “CIC” Agreements) benefit stockholders by providing an important incentive to executive officers to remain focused on running the business in the case of a pending or actual CIC event. Accordingly, each of the NEOs in position at fiscalyear-endand sixfive other current officers have a CIC Agreement providing for compensation in the form of a lump sum payment and other benefits in the event of a qualifying termination within 24 months offollowing the effective date of the CIC of the Company (a “double-trigger” agreement). (Mr. Rebel and Ms. Allen’s CIC Agreements terminated upon their separation from theThe Company in May 2018 and February 2018, respectively.)

In 2009, in line with market practices, the Committee ceased entering into compensatory agreements with executives that obligate the Company to providehas no taxgross-up payments intended to offset the cost of excise taxes imposed on

“excess parachute payments.” Accordingly, no CIC Agreementsprovisions in any agreement with any current executives includegross-up provisions.executive offers.

The Company’s current form CIC agreement includes a “bestafter-tax” provision where benefits would be reduced only if doing so would result in a betterafter-tax economic position for the affected executive. Under this provision, there are nogross-ups payable; theThe executive is solely responsible for payment of any excise taxes and all other applicable federal, state, and local income and employment taxes. The Committee plans to continue to monitor the costs and appropriate terms and conditions of CIC Agreements in the future.

A detailed discussion of the provisions of the CIC Agreements and associated monetary values is provided in thesub-section following the compensation tables entitledCompensation & Benefits Assurance Agreements.

 

 

h. Tax and Accounting Information

 

Internal Revenue Code Section 162(m)

The Committee and its Consultant consider the IRC Section 162(m) implications of all compensation decisions for our NEOs and other executives. Section 162(m) places a $1 million limit on the amount of compensation that the Company can deduct in any one taxable year for certain covered employees. Historically, certain performance-based pay has been excluded from this limit. However, the performance-based pay exemption has been repealed, effective for taxable years beginning after December 31, 2017, such that compensation paid to certain covered employees in excess of $1 million per taxable year will not be deductible unless it qualifies for transition relief applicable to certain arrangements in place as of November 2, 2017 (the “Section 162(m) Transition Relief”).

Our compensation programs have generallyhistorically been designed to provide the largestfor a substantial portion of an executive’s compensation to be delivered through programs generally intended to qualify as performance-based compensation under Section 162(m), including our annual performance incentive plan and long-term incentive plan in the form of stock options and performance shares. However, any such compensation will not qualify as performance-based compensation under Section 162(m) unless it qualifies for the Section 162(m) Transition Relief. Furthermore, in many cases, corporate objectives may not have necessarily aligned with the requirements to qualify as performance-based compensation under Section 162(m). Accordingly, the

Committee had (and continues to have) the discretion to grant awards or enter into compensation arrangements under which payments are not deductible under Section 162(m). For example, time-based restricted stock awards do not qualify as performance-based compensation under Section 162(m) and accordingly,our annual performance incentive plan for 2019 and performance shares granted in 2019 are subject to the $1 million deductibility limit. Despite the Committee’s efforts to structure certain compensation in a manner intended to

qualify as performance-based compensation under Section 162(m) and therefore not subject to its deduction limit, no assurance can be given that such compensation in fact will qualify for the Section 162(m) Transition Relief, and therefore, be eligible for exemption from the $1 million deductibility limit. Further, the Committee may modify compensation that was initially intended to be exempt from the $1 million deductibility limit under Section 162(m) if it determines that such modifications are consistent with our business needs. The Committee will continue to monitor the applicability of Section 162(m) to the Company’s ongoing compensation arrangements.

Internal Revenue Code Section 409A

Under IRC Section 409A, amounts deferred by an employee under anon-qualified deferred compensation plan (such as the SERP and EDCP) may be included in gross income when deferred and be subject to a 20% additional federal tax, unless the plan complies with certain requirements related to the timing of deferral election and distribution decisions.

52    JACK IN THE BOX INC.ï   2019 PROXY STATEMENT

  CD&A — VII. ADDITIONAL COMPENSATION INFORMATION  

The Company administers the SERP and EDCP intending to comply with Section 409A. The Company intends that its stock options are exempt from Section 409A.

Expensing of Stock and Option Awards

The Company accounts for compensation expense associated with stock and option awards in accordance with the Financial Accounting Standards Board (“FASB”)

authoritative guidance on stock compensation, and it uses a Black Scholes valuation model to determine the “fair value” of our stock options at grant. For further details regarding the accounting for the compensation expense associated with stock and option awards, refer to Note 12,13, ShareShare-Based-Based EmployeeCompensationin the Company’s 20182019 Annual Report on Form10-K.

 

 

JACK IN THE BOX INC.  ï  20192020 PROXY STATEMENT5355

 

  CD&A — VIII. CEO PAY RATIO DISCLOSURE  

    

 

VIII. CEO PAY RATIO DISCLOSURE

 

 

Under SEC rules, we are required to calculate and disclose the ratio of the annual total compensation of Mr. Comma, our CEO to the annual total compensation of our median compensated employee. This ratio is a reasonable estimate calculated in accordance with applicable SEC rules.

Below is (i) the fiscal 2019 annual total compensation of our CEO, (ii) the fiscal 2019 annual total compensation of our median employee, and (iii) the ratio of the annual total compensation of our CEO to that of our median employee.

CEO PAY RATIO (Fiscal 2019)

  CEO Annual Total Compensation(1)

$6,202,069  

  Median Employee Annual Total Compensation

$     14,935  
  Ratio of CEO Annual Total Compensation to Median   Employee Annual Total Compensation415:1  

(1)

As set forth in the fiscal 2019 Summary Compensation Table.

The majority of our employee population consists of hourly part-time restaurant employees, where we provide work schedule flexibility to accommodate each individual’s personal schedule.

To identify Due to the variability in work hours and tenure, for fiscal 2019, we identified a new median employee we usedusing gross base wages and target incentive potential (“total cash compensation”) of all full-time and part-time employees (and did not annualize for employees employed for less than the fiscal year), other than Mr. Comma, who were employed by the Company on September 23, 2018.

29, 2019. We did not annualize pay for employees employed for less than the full fiscal year.

For fiscal 2018:

 

• 

Our median employee was identified as a restaurant Team Member who worked an average of 21.426 hours per week. After identifying the median employee, usingwe used the same methodology to determine annual compensation as we use for our NEOs as set forth in theSummary Compensation Tablefor fiscal 2018, the annual total compensation of such employee was $14,968; and2019

•

The annual total compensation of Mr. Comma, our CEO, as set forth in theSummary Compensation Table for fiscal 2018, was $5,043,921.

Based on this information, for fiscal 2018, the ratio of our CEO’s annual total compensation to our median employee’s annual total compensation was 337:1.

 

 

5456    JACK IN THE BOX INC.  ï  20192020 PROXY STATEMENT

    

 

  COMPENSATION COMMITTEE REPORT  

 

COMPENSATION COMMITTEE REPORT

The Jack in the Box Compensation Committee is comprised solely of independent members of the Company’s Board of Directors. The Committee assists the Board in fulfilling its responsibilities regarding compensation matters and is responsible under its charter for determining the compensation of the Executive Officers. This includes reviewing all components of pay for our CEO and the other NEOs. The Committee reviewed and discussed the Compensation Discussion and Analysis contained in this Proxy Statement with its Consultant, with Management and with the Board. Based on this review and discussion, the Committee, on behalf of the Board, has authorized that this Compensation Discussion and Analysis be included in this Proxy Statement for fiscal 2018,2019, which ended on September 30, 2018.29, 2019.

THE COMPENSATION COMMITTEE

John T. Wyatt,Chair

Jean M. Birch

John P. Gainor

David L. Goebel

Sharon P. John

Madeleine A. KleinerMichael W. Murphy

 

JACK IN THE BOX INC.  ï  20192020 PROXY STATEMENT5557

 

  COMPENSATION RISK ANALYSIS  

    

 

COMPENSATION RISK ANALYSIS

The Committee has engaged in a thorough risk analysis of our compensation plans, programs, policies, and practices for all employees. This includes advice from the Committee’s independent Consultant regarding executive programs, and a detailed report, prepared by a Company Internal Compensation Risk Committee, describing the risk mitigation characteristics of the Company’s annual and long-term incentive programs. For the following reasons, the Committee believes that the design of our compensation programs, the governance of our programs, and our risk oversight process guard against imprudent risk taking that could have a material adverse effect on the Company.

Compensation Program Design Protections

 

 

Our base pay programs consist of competitive salaries that provide a fixed level of income on a regular basis. This mitigates incentives on the part of our executives and employees to take unnecessary or imprudent risks.

 

The Board approves the Company’s strategic plan, capital budget, and long-term financial and operational plans that serve as the basis for setting short and long-term incentive goals. Goals are intended to drive stockholder value and are set relative to the approved budget, historical and future expected performance, and a reasonable amount of stretch so that they do not encourage imprudent risk taking.

 

Our annual incentive programs provide variable pay opportunities for certain position levels based on achievement of multiple annual performance goals including both financial, operational, and, for some years, strategic goals. Goals are set at reasonable levels and payouts are managed as a percentage of pay.

The maximum awards that may be paid to executive officers under the annual and long-term incentive programs are capped, and the Committee retains the discretion to reduce payouts under the plans.

 

The largest amount of executive incentive compensation opportunity is tied to long-term incentive compensation that emphasizes sustained Company performance over time. This reduces incentive for executives and other employees to take risks that might increase short-term compensation at the expense of longer term Company results.

 

Equity awards have multi-year vesting, and RSU and PSU awards for executives have holding requirements until termination of service. This aligns the long-term interests of our NEOs and executives with those of our stockholders and discourages taking short-term risks at the expense of longer-term performance.

 

 

Structural Governance Protections

 

 

The Committee has adopted a clawback/compensation recovery policy that allows the Committee to take action to recover both cash compensation and performance-based equity awards for all NEOs and executives in the event of a material restatement based on fraud or intentional misconduct.

 

The Company has strong internal controls over the measurement and calculation of performance goals designed to keep them from being susceptible to manipulation.

 

Company policy also:

 

Prohibits directors and executive officers from engaging in hedging transactions involving our stock, which prevents executives from insulating themselves from poor stock performance by betting against our success;

Prohibits directors and officers from pledging Company stock or holding Company stock in margin accounts. This reduces the risk that executives might create incentives to focus on short-term performance at the expense of long-term performance; and

 

Has a formal ethics code of conduct and an ethics helpline and provides ethics training and communications to employees. The ethics program is intended to reinforce a culture of integrity.

 

The Company also has a Compensation Risk Committee that includes functional experts tasked specifically with evaluating potential unintended or unforeseen consequences of our compensation programs and their component parts.

 

 

5658    JACK IN THE BOX INC.  ï  20192020 PROXY STATEMENT

    

 

  EXECUTIVE COMPENSATION  

 

EXECUTIVE COMPENSATION

The Summary Compensation Table (“SCT”) summarizes the total compensation of our NEOs for the fiscal year ended September 30, 2018,29, 2019, and the prior two fiscal years to the extent required under the Securities and Exchange Commission rules.

Summary Compensation Table

 

 

Name &

Principal Position

 

Fiscal

Year

  Salary(1)  Bonus(2)  Stock
Awards(3)		  Option
Awards(4)		  Non-Equity
Incentive Plan
Compensation (5)		  Change in
Pension
Value &
NQDC
Earnings (6)		  

All

Other
Comp (7)

  Total 

Mr. Comma

 

 

2018

 

 

$

919,711

 

 

$

0

 

 

$

2,160,655

 

 

$

1,197,937

 

 

 

$   639,175

 

 

 

$              0

 

 

$

126,443

 

 

$

5,043,921

 

Chairman and CEO

  2017  $900,000  $0  $2,796,728  $858,264   $     78,660   $              0  $114,281  $4,747,933 
  

 

2016

 

 

$

909,615

 

 

$

0

 

 

$

5,963,780

 

 

$

703,380

 

 

 

$1,506,240

 

 

 

$     97,294

 

 

$

260,745

 

 

$

9,441,054

 

Mr. Tucker *

 

 

2018

 

 

$

298,558

 

 

$

0

 

 

$

370,364

 

 

$

0

 

 

 

$   137,536

 

 

 

$              0

 

 

$

173,957

 

 

$

980,415

 

Executive Vice President,

         

Chief Financial Officer

                                    

Mr. Rebel *

 

 

2018

 

 

$

329,723

 

 

$

0

 

 

$

72,557

 

 

$

0

 

 

 

$   157,389

 

 

 

$              0

 

 

$

89,294

 

 

$

648,963

 

Former Executive Vice President,

  2017  $564,000  $0  $618,362  $182,381   $     37,506   $   687,915  $176,235  $2,266,399 

Chief Financial Officer

 

 

2016

 

 

$

573,615

 

 

$

0

 

 

$

648,609

 

 

$

170,813

 

 

 

$   708,243

 

 

 

$1,620,465

 

 

$

179,577

 

 

$

3,901,322

 

Dr. Blankenship

 

 

2018

 

 

$

376,096

 

 

$

0

 

 

$

451,933

 

 

$

142,170

 

 

 

$   195,899

 

 

 

$              0

 

 

$

74,871

 

 

$

1,240,969

 

Executive Vice President,

  2017  $369,000  $0  $372,324  $111,566   $     24,539   $   273,429  $67,903  $1,218,761 

Chief of Staff & Strategy

 

 

2016

 

 

$

375,019

 

 

$

0

 

 

$

367,134

 

 

$

100,483

 

 

 

$   463,372

 

 

 

$1,273,533

 

 

$

87,146

 

 

$

2,666,687

 

Mr. Rudolph

 

 

2018

 

 

$

522,250

 

 

$

0

 

 

$

637,831

 

 

$

246,991

 

 

 

$   272,081

 

 

 

$              0

 

 

$

139,225

 

 

$

1,818,378

 

Executive Vice President,

  2017  $512,000  $0  $609,155  $182,381   $     34,048   $       2,578  $149,063  $1,489,225 

Chief Legal and Risk Officer

and Secretary

 

 

2016

 

 

$

520,308

 

 

$

0

 

 

$

612,256

 

 

$

170,813

 

 

 

$   642,944

 

 

 

$     64,290

 

 

$

186,302

 

 

$

2,196,913

 

Mr. Melancon*

 

 

2018

 

 

$

336,308

 

 

$

200,000

 

 

$

121,771

 

 

$

67,304

 

 

 

$   128,457

 

 

 

$     35,556

 

 

$

69,798

 

 

$

959,194

 

Senior Vice President of

         

Finance, Controller and Treasurer

                                    

Ms. Allen

 

 

2018

 

 

$

188,173

 

 

$

0

 

 

$

0

 

 

$

0

 

 

 

$              0

 

 

 

$              0

 

 

$

1,250,386

 

 

$

1,438,559

 

Former JIB President

  2017  $515,000  $0  $593,882  $182,381   $     14,678   $              0  $94,635  $1,400,576 
  

 

2016

 

 

$

522,596

 

 

$

0

 

 

$

489,171

 

 

$

180,869

 

 

 

$   644,651

 

 

 

$              0

 

 

$

146,770

 

 

$

1,984,057

 

Name &

Principal Position

 

Fiscal

Year

  Salary(1)  Bonus (2)  Stock
Awards(3)		  Option
Awards(4)		  Non-Equity
Incentive Plan
Compensation (5)		  Change in
Pension
Value &
NQDC
Earnings (6)		  

All

Other
Comp (7)

  Total 

Mr. Comma

 

 

2019

 

 

$

925,000

 

 

$

0

 

 

$

3,905,996

 

 

$

0

 

 

 

$1,114,625

 

 

 

$110,975

 

 

$

145,473

 

 

$

6,202,069

 

Chairman and CEO

  2018  $919,711  $0  $2,160,655  $1,197,937   $   639,175   $           0  $126,443  $5,043,921 
  

 

2017

 

 

$

900,000

 

 

$

0

 

 

$

2,796,728

 

 

$

858,264

 

 

 

$     78,660

 

 

 

$           0

 

 

$

114,281

 

 

$

4,747,933

 

Mr. Tucker*

 

 

2019

 

 

$

575,000

 

 

$

0

 

 

$

1,598,190

 

 

$

0

 

 

 

$   519,656

 

 

 

$           0

 

 

$

84,167

 

 

$

2,777,013

 

Executive Vice President

  2018  $298,558  $0  $370,364  $0   $   137,536   $           0  $173,957  $980,415 

Chief Financial Officer

                                    

Dr. Blankenship

 

 

2019

 

 

$

378,000

 

 

$

0

 

 

$

465,999

 

 

$

0

 

 

 

$   341,618

 

 

 

$946,196

 

 

$

80,838

 

 

$

2,212,651

 

Former Executive Vice President

  2018  $376,096  $0  $451,933  $142,170   $   195,899   $           0  $74,871  $1,240,969 

Chief of Staff & Strategy

 

 

2017

 

 

$

369,000

 

 

$

0

 

 

$

372,324

 

 

$

111,566

 

 

 

$     24,539

 

 

 

$273,429

 

 

$

67,903

 

 

$

1,218,761

 

Mr. Rudolph

 

 

2019

 

 

$

525,000

 

 

$

50,000

 

 

$

806,909

 

 

$

0

 

 

 

$   474,469

 

 

 

$  56,070

 

 

$

144,471

 

 

$

2,056,919

 

Executive Vice President

  2018  $522,250  $0  $637,831  $246,991   $   272,081   $           0  $139,225  $1,818,378 

Chief Legal and Risk Officer

and Corporate Secretary

 

 

2017

 

 

$

512,000

 

 

$

0

 

 

$

609,155

 

 

$

182,381

 

 

 

$     34,048

 

 

 

$    2,578

 

 

$

149,063

 

 

$

1,489,225

 

Mr. Tom*

 

 

2019

 

 

$

325,000

 

 

$

10,000

 

 

$

529,546

 

 

$

0

 

 

 

$   176,231

 

 

 

$           0

 

 

$

33,752

 

 

$

1,074,529

 

Vice President

Chief Operating Officer

                                    

 

*

Effective March 2018, Mr. Tucker succeededwas not employed by the Company in fiscal 2017, and Mr. Rebel as EVP, Chief Financial Officer. Mr. Rebel retired in May 2018 following atwo-month transition period. Mr. MelanconTom was not an NEO in fiscal 20172018 or 2016;2017; therefore, in accordance with SEC’s disclosure rules, information regarding histheir compensation in those fiscal years is not included.

(1)

This column shows the base salary earned during the fiscal year, including any amounts deferred by the NEOs in the Executive Deferred Compensation Plan (EDCP). The amounts for 2016 reflect one additional week of compensation due to the Company’s53-week fiscal year.

(2) 

The column reflects aone-time conditionalspecial bonus payment paidpayments to Mr. Melancon in two equal installments during fiscal 2018 for taking on significantMessrs. Rudolph and Tom to recognize their additional responsibilities relatedrelating to the evaluation of Qdoba strategic alternatives, and to assure his continued employment through any potential sale or dispositioncompletion of the Qdoba business securitization transaction and related transitionthe leadership in the development and restructuring activities.execution of an improved communications process with the franchise organization, respectively.

(3) 

This column shows the aggregate grant date fair value of the PSUs and RSUs granted during the applicable fiscal year, in accordance with FASB ASC Topic 718 (“ASC 718”) based on the assumptions and methodologies set forth in the Company’s 20182019 Annual Report on Form10-K (Note 12,13, Share-Based Employee Compensation). The 2018 amount for Mr. Tucker represents anew-hire grant of 4,486 RSUs in recognition of his forfeiture of equity grants and bonus from his prior employment and to provide him an equity stake in the Company; for Dr. Blankenship, the amount also includes a specialone-time award of 2,110 RSUs in recognition of his role as interim Chief Operating Officer (“COO”) while a search for a COO was underway, and for Mr. Rudolph, a specialone-time award of 2,215 RSUs in recognition of his critical role in driving the activities that culminated in the sale of Qdoba; each of these RSU awards vest 33% per year over three years on each anniversary of the grant.

  

The PSU awards cliff vest after three years based on Company performance during a three-fiscal year period. The performance metrics are established at the beginning of the three-year period when the grant is made; themade. The specific performance goals for all or a portion of the award are reviewed and typically set by the Committee (a) for the full three-year performance period at the time of grant for some performance metrics, and (b) for aone-year period at the beginning of each fiscal year for other performance metrics. The amounts for each year include the sum of the grant date fair values under ASC 718 for current year PSU grants and past year PSU grants, for which performance metrics were set in that year, at target values. Assuming the maximum level of performance achievement (150% of target), the PSU total values for each NEO in 20182019 are, respectively: Mr. Comma, $1,325,085;$2,689,199; Mr. Rebel, $108,836;Tucker, $435,894; Dr. Blankenship, $169,641;$322,367; Mr. Rudolph, $288,282,$556,521, and Mr. Melancon, $74,837.Tom, $120,780.

(4) 

This column shows the grant date fair values of stock options granted during the applicable fiscal year in accordance with ASC 718. The grant date fair values have been determined based on the assumptions and methodologies set forth in the Company’s 20182019 Annual Report on Form10-K (Note 12,13, Share-Based Employee Compensation).

(5) 

This column shows the annual incentive awards earned under the annual incentive plan for executives. Performance achievement is approved by the Committee following the end of the fiscal year. Annual incentive payments are made following Committee approval and reported in the SCT in the fiscal year for which the incentive is earned.

(6) 

This column shows the change in the estimated present value of each NEO’s accumulated benefit under (a) the qualified pension plan (the “Retirement Plan”) which was a negative amount for each of the NEO participants so is not reflected in this column, and (b) the Supplemental Executive Retirement Plan (“SERP”) for Mr. Melancon, and which was a negative amount for Mr. Rebel and Dr. Blankenship and is not reflected in this column.Blankenship. The estimates are determined using interest rate and mortality rate assumptions consistent with those used in the

JACK IN THE BOX INC.ï  2019 PROXY STATEMENT57

  EXECUTIVE COMPENSATION  

Company’s financial statements for fiscal years ending September 30, 2018, October 1, 2017, and October 2, 2016. The present value of Mr. Rebel’s benefit under the SERP as of29, 2019, September 30, 2018 is based on his actual retirement date (Mayand October 1, 2018) and is reduced to reflect that his benefit will start before normal retirement age.2017. TheRP-2014 Mortality Table is used for the Retirement Plan and SERP estimates (the SERP uses a white collarwhite-collar adjustment). Both Plans used theMP-2017MP-2018 generational scale projected from 2006, modified to use 15 year15-year convergence to an ultimate rate of 0.75%. The amounts reported in this column may fluctuate significantly in a given year based on a number of factors that affect the formula to determine pension benefits, including changes in: (i) salary and annual incentive; (ii) years of service; and, predominantly (iii) the discount rates used in estimating present values, which were 3.24% for the SERP and 3.36% for the Retirement Plan for 2019; 4.37% for the SERP and 4.40% for the Retirement Plan for 2018,2018; and, 3.80% for the SERP and 3.99% for the Retirement Plan for 2017, and 3.60% for the SERP and 3.85% for the Retirement Plan for 2016.2017. Participating NEOs become vested in the Retirement Plan after five years, and in the SERP after attaining age 55 and completing ten years of service. Both plans have been closed to new participants, and the Retirement Plan was sunset on December 31, 2015. For a detailed discussion of the Company’s pension benefits, see the sections of this Proxy Statement titled “Retirement Plan,” “Supplemental Executive Retirement Plan” and “Pension Benefits Table” and accompanying footnotes. The Company does not provide above-market or preferential earnings onnon-qualified deferred compensation.

JACK IN THE BOX INC.ï  2020 PROXY STATEMENT59

  EXECUTIVE COMPENSATION  

(7) 

Amounts in this column for fiscal 20182019 are detailed in the following table:

 

All Other Compensation TableAll Other Compensation Table All Other Compensation Table 
  

Perquisite

Allowance

   Deferred
Compensation
Matching
Contribution (a)		   Company-
Paid Life
Insurance
Premiums		   Other 

Total

All Other
Compensation

   

Perquisite

Allowance (a)

   Deferred
Compensation
Matching
Contribution (b)		   Company-
Paid Life
Insurance
Premiums		   Other 

Total

All Other
Compensation

 

Mr. Comma (CEO)

   $66,500    $59,943    $    0   $0  $   126,443    $66,500    $78,973    $    0   $0   $145,473 

Mr. Tucker (CFO)

   $27,000    $         0    $114   $146,843(b)   $   173,957    $52,000    $31,947    $220   $0   $  84,167 

Mr. Rebel (former CFO)

   $31,000    $  8,080    $156   $50,058(c)  $     89,294 

Dr. Blankenship (CSS)

   $52,000    $22,427    $444   $0  $     74,871    $52,000    $28,396    $442   $0   $  80,838 

Mr. Rudolph (CLO)

   $52,000    $33,757    $279   $53,189(c)  $   139,225    $52,000    $39,006    $276   $53,189(c)   $144,471 

Mr. Melancon (SVP)

   $45,700    $23,609    $489   $0  $     69,798 

Ms. Allen (former JIB President)

   $19,000    $  9,452    $122   $1,221,812(d)  $1,250,386 

(a) Represents matching contributions under the 401(k) Plan and the restoration matching contribution in the EDCP related to fiscal 2018 compensation. For Mr. Rudolph, this amount includes the enhanced EDCP Company contribution he receives in place of the SERP, as discussed in the“Non-Qualified Deferred Compensation” section below. In November 2017, Mr. Rudolph reached the maximum ten years of Company contributions to the EDCP and ceased receiving the enhanced EDCP Company contribution.

(b) Represents amounts the Company paid for expenses associated with Mr. Tucker’s relocation to San Diego in fiscal 2018, consisting of $116,770 in relocation expenses and a $30,073 taxgross-up for a portion of expenses, consistent with the Company’s relocation policy and approved by the Compensation Committee.

(c) With respect to Mr. Rudolph, represents cash dividends paid on December 15, 2017; March 16, 2018; June 11, 2018 and September 5, 2018 for his restricted stock shares being held in an escrow account until his termination or retirement. With respect to Mr. Rebel, represents cash dividends paid on December 15, 2017 and March 16, 2018 for his restricted stock shares held in an escrow account until his termination or retirement, which restricted stock shares were released from the escrow account and delivered to him upon his retirement in May 2018.

(d) Represents separation benefits paid to Ms. Allen that include (1) a lump sum cash payment of $515,000, equal toone-year of base pay pursuant to her August 2014 employment offer letter, and (2) an additional cash payment of $706,812, representing the value of cancelled equity awards and at her election, a lump sum cash payment in lieu of direct payment of COBRA medical premiums.

   

    

   

    

Mr. Tom (COO)

   $24,600    $  8,650    $502   $0   $  33,752 

(a) Represents the total cash perquisite allowance to each NEO for fiscal 2019. The cash perquisite allowance is described in CD&A Section VI.e. (“Cash Perquisite Allowance”).

(b) Represents matching contributions under the 401(k) Plan and the restoration matching contribution in the EDCP related to fiscal 2019 compensation.

(c) Represents cash dividends paid on December 18, 2018; March 19, 2019; June 14, 2019 and September 10, 2019 for Mr. Rudolph’s restricted stock shares being held in an escrow account until his termination or retirement.

(a) Represents the total cash perquisite allowance to each NEO for fiscal 2019. The cash perquisite allowance is described in CD&A Section VI.e. (“Cash Perquisite Allowance”).

(b) Represents matching contributions under the 401(k) Plan and the restoration matching contribution in the EDCP related to fiscal 2019 compensation.

(c) Represents cash dividends paid on December 18, 2018; March 19, 2019; June 14, 2019 and September 10, 2019 for Mr. Rudolph’s restricted stock shares being held in an escrow account until his termination or retirement.

   

    

   

 

5860    JACK IN THE BOX INC.  ï  20192020 PROXY STATEMENT

    

 

  EXECUTIVE COMPENSATION  

 

Grants of Plan-Based Awards

 

The following table provides information on fiscal 20182019 cash and equity incentive awards granted to our NEOs. Cash incentive awards are based on fiscal year performance under our annual incentive plan (“AIP”). Long-term equity incentive compensation includes stock options, time-based restricted stock units (“RSUs”), and performance share awards (“PSUs”) that vest, if at all, upon achievement of performance goals over a three-fiscal year period. The 20182019 incentive award terms are further described in CD&A Sections IV (“Elements of Compensation”) and VI (“Fiscal 20182019 Compensation”).

 

 

Grant

Date(1)

 

Approval

Date

 

Award

Type(2)

  

 

Estimated Future Payouts Under
Non-Equity Incentive Plan Awards (3)

 

 

Estimated Future Payouts Under
Equity Incentive Plan Awards (4)

  

All Other
Stock
Awards:
Number of
Shares of

Stock or

Units #(5)

 

All Other
Option
Awards:
Number of

Securities

Underlying

Options # (6)

 

Exercise

or Base
Price of
Option

Awards

($/Share)

 Grant
Date Fair
Value of
Stock and
Option
Awards
($) (7)		  

Grant

Date(1)

 

Approval

Date

 

Award

Type(2)

  

 

Estimated Future Payouts Under
Non-Equity Incentive Plan Awards (3)

 

 

Estimated Future Payouts Under
Equity Incentive Plan Awards  (4)

  

All Other
Stock
Awards:
Number of
Shares of

Stock or

Units #(5)

 

All Other
Option
Awards:
Number of

Securities

Underlying

Options # (6)

 

Exercise

or Base
Price of
Option

Awards

($/Share)

 Grant
Date Fair
Value of
Stock and
Option
Awards
($) (7)		 
Name 

  Threshold  

($)

 

Target

($)

 

  Maximum  

($)

 Threshold
(#)		 Target
(#)		 Maximum
(#)		  

  Threshold  

($)

 

Target

($)

 

  Maximum  

($)

 Threshold
(#)		 Target
(#)		 Maximum
(#)		 

Mr. Comma

(CEO)

  12/20/2017   12/20/2017   PSU 16-18         1,193   2,385   3,578        $235,161   11/29/2018   11/15/2018   PSU 17-19         1,128   2,256   3,385        $196,233 
  12/20/2017   12/20/2017   PSU 17-19      1,128   2,256   3,385     $222,474   11/29/2018   11/15/2018   PSU 18-20      1,080   2,159   3,239     $187,768 
  12/20/2017   12/20/2017   PSU 18-20      2,159   4,318   6,477     $425,755   11/29/2018   11/15/2018   PSU 19-21      8,099   16,199   24,298     $1,408,798 
  12/20/2017   12/20/2017   RSU         12,954    $1,277,264   11/29/2018   11/15/2018   RSU         24,298    $2,113,197 
  2/26/2018   12/20/2017   Option          64,788   $90.06  $1,197,937     11/15/2018   AIP   $ —  $925,000   $1,850,000               
    12/20/2017   AIP   $ —  $925,000   $1,850,000               

Mr. Tucker

(CFO)

  4/02/2018   2/26/2018   RSU-NH         4,486    $370,364   11/29/2018   11/15/2018   PSU 19-20      1,671   3,341   5,012     $290,596 
    2/26/2018   AIP   $ —  $199,038   $   398,077                 11/29/2018   11/15/2018   RSU         5,012    $435,894 

Mr. Rebel

(Former-CFO)

  12/20/2017   12/20/2017   PSU 16-18      245   490   735     $48,320 
  12/20/2017   12/20/2017   PSU 17-19      123   246   369     $24,237   11/29/2018   11/15/2018   RSU-Retention         10,023    $871,700 
    12/20/2017   AIP   $ —  $423,000   $   846,000                   11/15/2018   AIP   $ —  $431,250   $   862,500               

Dr. Blankenship

(CSS)

  12/20/2017   12/20/2017   PSU 16-18      170   341   511     $33,590   11/29/2018   11/15/2018   PSU 17-19      147   293   440     $25,511 
  12/20/2017   12/20/2017   PSU 17-19      147   293   440     $28,923 
  12/20/2017   12/20/2017   PSU 18-20      257   513   770     $50,582 
  12/20/2017   12/20/2017   RSU         1,539    $151,745   11/29/2018   11/15/2018   PSU 18-20      128   257   385     $22,308 
  2/27/2018   2/26/2018   RSU-SP         2,110    $187,094   11/29/2018   11/15/2018   PSU 19-21      962   1,923   2,885     $167,272 
  2/26/2018   12/20/2017   Option          7,689   $90.06  $142,170   11/29/2018   11/15/2018   RSU         2,885    $250,908 
    12/20/2017   AIP   $ —  $283,500   $   567,000                     AIP   $ —  $283,500   $   567,000               

Mr. Rudolph

(CLO)

  12/20/2017   12/20/2017   PSU 16-18      290   579   869     $57,106   11/29/2018   11/15/2018   PSU 17-19      240   479   719     $41,688 
  12/20/2017   12/20/2017   PSU 17-19      240   479   719     $47,262   11/29/2018   11/15/2018   PSU 18-20      223   445   668     $38,731 
  12/20/2017   12/20/2017   PSU 18-20      445   891   1,336     $87,820   11/29/2018   11/15/2018   PSU 19-21      1,671   3,341   5,012     $290,596 
  12/20/2017   12/20/2017   RSU         2,672    $263,459   11/29/2018   11/15/2018   RSU         5,012    $435,894 
  3/23/2018   3/23/2018   RSU-SP         2,215    $182,184     11/15/2018   AIP   $ —  $393,750   $   787,500               
  2/26/2018   12/20/2017   Option          13,358   $90.06  $246,991 
    12/20/2017   AIP   $ —  $393,750   $   787,500               

Mr. Melancon

(SVP)

  12/20/2017   12/20/2017  ��PSU16-18      68   136   204     $13,426 

Mr. Tom
(COO)

  11/29/2018   11/15/2018   PSU 18-20      58   116   174     $10,074 
  12/20/2017   12/20/2017   PSU17-19      63   127   190     $12,506   11/29/2018   11/15/2018   PSU 19-21      405   810   1,215     $70,446 
  12/20/2017   12/20/2017   PSU18-20      122   243   365     $23,960   11/29/2018   11/15/2018   RSU         1,215    $105,668 
  12/20/2017   12/20/2017   RSU         729    $71,879   11/29/2018   11/15/2018   RSU-Retention         3,948    $343,358 
  2/26/2018   12/20/2017   Option          3,640   $90.06  $67,304     11/15/2018   AIP   $ —  $146,520   $   292,500               
    12/20/2017   AIP   $ —  $185,900   $   371,800               

Ms. Allen

(Former JIB

President)

  12/20/2017   12/20/2017   AIP    $386,250   $   772,500               

 

(1)

All annual grants were approved at the December 2017November 15, 2018 Committee meeting, with a grant date of December 20, 2017 for PSUs/RSUs and February 26, 2018 for stock options, the second business day of the Company’s next open trading window, as is the Company’s standard practice. The new hire grant(“RSU-NH”) for Mr. Tucker and special RSU awards(“RSU-SP”) for Dr. Blankenship and Mr. Rudolph were approved by the Committee on the respective dates shown above.November 29, 2018. In accordance with ASC 718, the “grant date” is shown for the portion of the PSUs awarded in fiscal 20182019 that relate to the fiscal 20182019 performance period, and the portion of the PSUs awarded in fiscal 20162017 and 20172018 related to the fiscal 20182019 performance period, as further described in Footnote 7 to this table.

(2) 

For PSU awards, this column shows the three fiscal years of the PSU performance period.

(3) 

This column shows the potential payouts under the fiscal 20182019 annual incentive plan (“AIP”), which could have been earned based on performance in fiscal 2018.2019. The threshold payout is zero, target payout represents the amount payable for achieving the target level of performance, and maximum payout is capped at two times target payout. Incentive payouts are prorated between performance levels, and the payout values are calculated using the executive’s annual salary rate as specified at the time performance goals are approved by the Committee. The SCT for fiscal 20182019 shows the actual incentive compensation earned by our NEOs for fiscal 20182019 performance. Messrs. Rebel and Tucker received prorated incentive payments based on Mr. Rebel’smid-year retirement and Mr. Tucker’smid-year start of employment. Ms. Allen, who separated from the Company in February 2018, did not receive an incentive payment.

(4) 

This column shows the threshold, target, and maximum potential share payout levels for the PSUs under the Company’s long-term incentive plan for the fiscal2018-202019-21 PSU award and for the fiscal 20182019 performance period of the2016-182017-19 and2017-19 PSU awards. The amount for the2018-20 PSU award represents the fiscal 2018 performance period for one metric only (consolidated systemwide sales) for the reasons explained in Footnote 7.awards. Threshold payout for all of the PSUs reflected above is 50% of target and requires achieving an established minimum performance requirement (there is no payout if performance doesn’t meet the minimum requirement). Maximum payout is 150% of target.

(5) 

This column shows the number of RSUs granted on December 20, 2017 that vest 25% per year over four years on each anniversary of the grant date, to the executives in position at that time, the new hire grant for Mr. Tucker(RSU-NH), andincluding the special awardsretention grants for Dr. BlankenshipMessrs. Tucker and Mr. RudolphTom(RSU-SP)(RSU-Retention) that vest 33% per year over three years on each anniversary of the grant date.

(6) 

This column shows the number ofNo stock options were granted on February 26, 2018 that vest 33% per year over three years on each anniversary of the grant date. The options expire seven years from the grant date. The exercise price is the closing price of Common Stock on the grant date ($90.06).in fiscal 2019.

JACK IN THE BOX INC.ï  2019 PROXY STATEMENT59

  EXECUTIVE COMPENSATION  

(7) 

For stock options, the value represents the grant date fair value computed in accordance with ASC 718, which is a theoretical value at grant using a valuation model that requires the input of assumptions, including the expected volatility of our stock price. As such, the values may not reflect the actual amounts that our NEOs will realize; rather the actual amount realized will depend on the Company’s stock price relative to the exercise price. The values of PSUs and RSUs also represent the grant date fair values, as computed in accordance with ASC 718, based on the closing price of the Company’s Common Stock on the grant date discounted by the present value of the expected dividend stream over the vesting period, as applicable, which for the annual PSU grants was $98.60 for PSUs and $98.60 for RSUs;$86.97; and, for Mr. Tucker’s new hirethe annual RSU grant, $82.56; Dr. Blankenship’sgrants, $86.97, including for the special RSU award, $88.67;retention grants for Messrs. Tucker and Mr. Rudolph’s special RSU award, $82.25.Tom. The grant date fair values of all awards were determined based on the assumptions and methodologies set forth in the Company’s 20182019 Annual Report on Form10-K (Note 12,13, Share-Based Employee Compensation). PSU awards, which cliff vest after three years, are made annually and vest based on the Company’s performance during the succeeding three-fiscal year period. The performance metrics are established at the beginning of the three- fiscal year period when the grant is made; while the specific performance goals are either set by the Committee (a) at the time of grant (or at a later time) for the full (or remaining) performance period or (b) at the beginning of each fiscal year for that portion of the performance period; in accordance with SEC rules and ASC 718, the values shown on each of the three rows for the PSUs reflect the grant date fair value of the fiscal 20182019 performance period (total or portion, as applicable) of the award based on probable outcome (target level performance) of each of the PSU awards.

JACK IN THE BOX INC.ï  2020 PROXY STATEMENT61

  EXECUTIVE COMPENSATION  

Outstanding Equity Awards at FiscalYear-End 20182019

 

The following table provides information on all outstanding option awards and unvested stock awards held by each of the NEOs at the end of fiscal 2018. Ms. Allen is not included in the table because she did not have any outstanding option awards or unvested stock awards at the end of fiscal 2018.2019. Each option grant is shown separately, and the vesting schedule is shown as Footnote 1 to the table. The market value of the stock awards is based on the closing price of Jack in the Box Inc. Common Stock as of the last trading day of the fiscal year, September 28, 2018,29, 2019, which was $83.83.$90.45.

 

 Option Awards(1) Stock Awards  Option Awards(1) Stock Awards 
Name 

Option

Grant Date

 

Number of

Securities

Underlying

Unexercised

Options

Exercisable

(#)

 

Number of

Securities

Underlying

Unexercised

Options

Unexercisable

(#)

 

Option

Exercise

Price

($)

 

Option

Expiration

Date

 

Number

Of Shares

or Units

of Stock

That

Have Not

Vested

(#)(2)

 

Market

Value of

Shares or

Units of

Stock That

Have Not

Vested

($)

 

Equity

Incentive

Plan Awards:

Number of

Unearned

Shares,

Units or

Other Rights

That Have

Not Vested

(#) (3) 

 Equity
Incentive
Plan Awards:
Market or
Payout Value
of Unearned
Shares,
Units or
Other Rights
That Have
Not Vested
($)		  

Option

Grant Date

 

Number of

Securities

Underlying

Unexercised

Options

Exercisable

(#)

 

Number of

Securities

Underlying

Unexercised

Options

Unexercisable

(#)

 

Option

Exercise

Price

($)

 

Option

Expiration

Date

 

Number

Of Shares

or Units

of Stock

That

Have Not

Vested

(#)(2)

 

Market

Value of

Shares or

Units of

Stock That

Have Not

Vested

($)

 

Equity

Incentive

Plan Awards:

Number of

Unearned

Shares,

Units or

Other Rights

That Have

Not Vested

(#) (3) 

 Equity
Incentive
Plan Awards:
Market or
Payout Value
of Unearned
Shares,
Units or
Other Rights
That Have
Not Vested
($)		 

Mr. Comma (CEO)

 

 

11/24/2015

 

 

 

—

 

 

 

14,455

 

 

 

$  75.24

 

 

 

11/24/2022

 

 

 

140,345

 

 

$

11,765,121

 

 

 

13,488

 

 

 

$1,130,699

 

 

 

11/24/2015

 

 

 

14,455

 

 

 

—

 

 

 

$  75.24

 

 

 

11/24/2022

 

 

 

155,255

 

 

$

14,042,815

 

 

 

21,486

 

 

 

$1,943,409

 

 

 

11/29/2016

 

 

 

13,675

 

 

 

27,351

 

 

 

$104.95

 

 

 

11/29/2023

 

     

 

11/29/2016

 

 

 

27,350

 

 

 

13,676

 

 

 

$104.95

 

 

 

11/29/2023

 

    
 

 

2/26/2018

 

 

 

—

 

 

 

64,788

 

 

 

$  90.06

 

 

 

2/26/2025

 

         

 

2/26/2018

 

 

 

21,596

 

 

 

43,192

 

 

 

$  90.06

 

 

 

2/26/2025

 

        

Mr. Tucker (CFO)

           

 

4,486

 

 

$

376,061

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

$       —

 

 

 

—

 

 

 

18,818

 

 

$

1,702,088

 

 

 

3,963

 

 

 

$   358,453

 

Mr. Rebel

 

 

11/25/2014

 

 

 

12,842

 

 

 

—

 

 

 

$  73.53

 

 

 

11/25/2021

 

 

 

2,500

 

 

$

209,575

 

 

 

738

 

 

 

$     61,867

 

(Former CFO)

 

 

11/24/2015

 

 

 

10,531

 

 

 

—

 

 

 

$  75.24

 

 

 

11/24/2022

 

    
 

 

11/29/2016

 

 

 

8,718

 

 

 

—

 

 

 

$104.95

 

 

 

11/29/2023

 

        

Dr. Blankenship

 

 

11/25/2014

 

 

 

2,335

 

 

 

—

 

 

 

$  73.53

 

 

 

11/25/2021

 

 

 

9,683

 

 

$

811,726

 

 

 

1,677

 

 

 

$   140,583

 

 

 

11/25/2014

 

 

 

2,335

 

 

 

—

 

 

 

$  73.53

 

 

 

11/25/2021

 

 

 

10,245

 

 

$

926,660

 

 

 

2,551

 

 

 

$   230,738

 

(CSS)

 

 

11/24/2015

 

 

 

4,130

 

 

 

2,065

 

 

 

$  75.24

 

 

 

11/24/2022

 

     

 

11/24/2015

 

 

 

6,195

 

 

 

—

 

 

 

$  75.24

 

 

 

11/24/2022

 

    
 

 

11/29/2016

 

 

 

1,777

 

 

 

3,556

 

 

 

$104.95

 

 

 

11/29/2023

 

     

 

11/29/2016

 

 

 

3,555

 

 

 

1,778

 

 

 

$104.95

 

 

 

11/29/2023

 

    
 

 

2/26/2018

 

 

 

—

 

 

 

7,689

 

 

 

$  90.06

 

 

 

2/26/2025

 

         

 

2/26/2018

 

 

 

2,563

 

 

 

5,126

 

 

 

$  90.06

 

 

 

2/26/2025

 

        

Mr. Rudolph (CLO)

 

 

11/25/2014

 

 

 

11,171

 

 

 

—

 

 

 

$  73.53

 

 

 

11/25/2021

 

 

 

73,715

 

 

$

6,179,528

 

 

 

2,823

 

 

 

$   236,652

 

 

 

11/25/2014

 

 

 

11,171

 

 

 

—

 

 

 

$  73.53

 

 

 

11/25/2021

 

 

 

75,298

 

 

$

6,810,704

 

 

 

4,431

 

 

 

$   400,784

 

 

 

11/24/2015

 

 

 

7,021

 

 

 

3,510

 

 

 

$  75.24

 

 

 

11/24/2022

 

     

 

11/24/2015

 

 

 

10,531

 

 

 

—

 

 

 

$  75.24

 

 

 

11/24/2022

 

    
 

 

11/29/2016

 

 

 

2,906

 

 

 

5,812

 

 

 

$104.95

 

 

 

11/29/2023

 

     

 

11/29/2016

 

 

 

5,812

 

 

 

2,906

 

 

 

$104.95

 

 

 

11/29/2023

 

    
 

 

2/26/2018

 

 

 

—

 

 

 

13,358

 

 

 

$  90.06

 

 

 

2/26/2025

 

         

 

2/26/2018

 

 

 

4,452

 

 

 

8,906

 

 

 

$  90.06

 

 

 

2/26/2025

 

        

Mr. Melancon

 

 

11/25/2014

 

 

 

3,113

 

 

 

—

 

 

 

$  73.53

 

 

 

11/25/2021

 

 

 

3,287

 

 

$

275,549

 

 

 

758

 

 

 

$     63,543

 

(SVP)

 

 

11/24/2015

 

 

 

1,652

 

 

 

826

 

 

 

$  75.24

 

 

 

11/24/2022

 

    
 

 

11/29/2016

 

 

 

769

 

 

 

1,538

 

 

 

$104.95

 

 

 

11/29/2023

 

    
 

 

2/26/2018

 

 

 

—

 

 

 

3,640

 

 

 

$  90.06

 

 

 

2/26/2025

 

        

Mr. Tom (COO)

 

 

2/26/2018

 

 

 

1,079

 

 

 

2,160

 

 

 

$  90.06

 

 

 

2/26/2025

 

 

 

6,040

 

 

$

546,318

 

 

 

1,289

 

 

 

$   116,590

 

 

(1) 

All option awards vest 33% each year for three years from date of grant.

(2)

The amounts in this column are:

  

(a) unvested restricted stock awards or RSUs granted under the stock ownership program with vesting subject to the executive’s continued employment with the Company, and full vesting ten years from the grant date and issued only upon termination (Mr. Comma, 34,700; and Mr. Rudolph, 58,815);

  

(b) unvested RSUs that vest (i) for each executive: (A) 20% each year for five years for grants prior to November 2015, and (B) 25% each year for four years for the regular November 2015, November 2016, November 2018 and December 2017 grants (Mr. Comma, 38,967;47,391; Mr. Tucker, 15,035; Dr. Blankenship, 5,253;5,892; Mr. Rudolph, 8,754;10,059; and Mr. Melancon, 2,316)Tom, 5,684); (ii) for Mr. Comma’s FY 2016 special retention stock award: 49,560 RSUs that vest 50% four years after the date of grant and the remaining 50% five years after grant; and (iii) for Mr. Tucker’s new hire grant, 4,4862,990 RSUs, and Dr. Blankenship and Mr. Rudolph’s specialone-time RSU awards, 2,1101,406 and 2,2151,476 RSUs respectively, that vest 33% each year for three years; and

  

(c) unvested PSUs for which the performance goals have been met for a completed performance period and that vest upon the third anniversary of the November 2015,2016, November 20162018 and December 2017 grant dates, subject to the executive’s continued employment with the Company (Mr. Comma, 17,118;23,604; Mr. Rebel, 2,500;Tucker, 793; Dr. Blankenship, 2,320;2,947; Mr. Rudolph, 3,931;4,948; and Mr. Melancon, 9719)Tom, 356).

(3)

This column shows unvested PSUs granted in November 2015,2016, November 20162018 and December 2017 for which the performance achievement was not yet known at fiscalyear-end (“FYE”), and that vest upon the third anniversary of each grant date. The share amount is reported at target payout level.

 

6062    JACK IN THE BOX INC.  ï  20192020 PROXY STATEMENT

    

 

  EXECUTIVE COMPENSATION  

 

Option Exercises and Stock Vested in Fiscal 20182019

 

The following table provides information on stock option exercises and shares acquired on the vesting of stock awards by the NEOs during fiscal 2018. Option award value realized is calculated by subtracting the aggregate exercise price of the options exercised from the aggregate fair market value of the shares of Jack in the Box Inc. stock acquired on the date of exercise.2019. Stock award value realized is calculated by multiplying the number of shares shown in the table by the closing price of our stock on the date the stock awards vested. There were no stock option exercises by the NEOs in fiscal 2019.

 

  Option Awards   Stock Awards(1)   Option Awards   Stock Awards(1) 
  Number of Shares
Acquired on
Exercise (#)		   Value Realized on
Exercise ($)		   Number of Shares
Acquired on
Vesting (#)		   Value Realized on
Vesting ($)		   Number of Shares
Acquired on
Exercise (#)		   

Value Realized on

Exercise ($)

   Number of Shares
Acquired on
Vesting (#)		   

Value Realized on

Vesting ($)

 

Mr. Comma (CEO)

  

 

74,870

 

  

 

$1,241,553

 

  

 

32,188

 

  

 

$3,259,952

 

  

 

0

 

  

 

$              0

 

  

 

26,248

 

  

 

$2,287,689

 

Mr. Tucker (CFO)

  

 

0

 

  

 

$              0

 

  

 

0

 

  

 

$              0

 

  

 

0

 

  

 

$              0

 

  

 

1,496

 

  

 

$   121,056

 

Mr. Rebel (former CFO)

  

 

25,263

 

  

 

$   886,888

 

  

 

78,699

 

  

 

$6,729,176

 

Dr. Blankenship (CSS)

  

 

0

 

  

 

$              0

 

  

 

5,084

 

  

 

$   515,152

 

  

 

0

 

  

 

$              0

 

  

 

4,431

 

  

 

$   381,767

 

Mr. Rudolph (CLO)

  

 

0

 

  

 

$              0

 

  

 

8,215

 

  

 

$   832,550

 

  

 

0

 

  

 

$              0

 

  

 

6,965

 

  

 

$   600,805

 

Mr. Melancon (SVP)

  

 

0

 

  

 

$              0

 

  

 

2,277

 

  

 

$   230,747

 

Ms. Allen (former JIB President)

  

 

15,217

 

  

 

$   252,674

 

  

 

6,600

 

  

 

$   670,068

 

Mr. Tom (COO)

  

 

0

 

  

 

$              0

 

  

 

174

 

  

 

$     13,831

 

(1) 

The reported number of shares and value realized on vesting includes time-vested RSUs granted in prior years, and the PSUs granted in November 20142015 for the performance period fiscal 2015-2017,2016-2018, which vested in November 20172018 and resulted in a payout of 118.6%95% of the target PSU award. For Mr. Rebel, the amount includes 6,459 RSUs that vested upon his retirement in May 2018 with a value of $577,499, although the shares were subject to asix-month delay pursuant to 409A regulations and delivered on November 1, 2018.

Retirement Plan Benefits

 

The following table provides information on the pension benefits for the NEOs under each of the following pension plans:

 

Retirement Plan

The Retirement Plan is a Company-funded andtax-qualified retirement plan that was offered to eligible employees hired prior to January 1, 2011 that had reached age 21 and completed one year of service (at least 1,000 hours/year). FiveThree NEOs who were hired prior to 2011 participate in the plan, including former CFO, Mr. Rebel, who retired during 2018.plan. Participants are 100% vested after completing five years (1,000 hours per year) of service. As of December 31, 2015, the Retirement Plan was “sunset” and employees no longer accrue additional benefits based on additional pay and service. The plan provides that a participant retiring at the normal retirement age of 65 will receive benefits based primarily on the formula described below:

 

 (1)

1% of the average of the five highest consecutive calendar years of pay (base salary and annual incentive out of the last ten years of eligible service (referred to as “Final Average Pay”), multiplied by the number of full calendar years and months while an eligible employee.

PLUS

 

 (2)

0.4% of Final Average Pay in excess of Covered Compensation (average of the Social Security taxable wage bases) multiplied by the number of full calendar years and months while an eligible employee (up to a maximum of 35 years).

A participant in the Retirement Plan who has at least ten years of vesting service may elect to begin receiving reduced payments as early as age 55. Note: Prior to 1989, benefits are subject to grandfathered minimum benefit accruals under

the previous plan. Retirement plan benefits are (i) not permitted to be paid to participants while actively employed with Jack in the Box Inc. and (ii) typically paid in the form of a monthly annuity unless the present value of the accrued benefit is equal to or less than $20,000 at termination and in such event, may be paid in the form of a lump sum payment.

Supplemental Executive Retirement Plan (SERP)

Effective January 1, 2007, the SERP was closed to new participants. Executives and certain “highly compensated employees” who were hired or promoted into such position prior to January 1, 2007 (including three NEOs) areone NEO) is eligible to participate in the SERP. The SERP, established in 1990, provides for retirement benefits above amounts available under the Company’s Retirement Plan due to IRC limits that restrict benefits available under the Company’stax-qualified plan. The SERP is unfunded and not qualified for tax purposes.

The SERP provides that a participant retiring at the normal retirement age of 62 will receive a benefit equal to a target replacement income, based on final average pay and service. When combined with other amounts payable under the Company’stax-qualified pension benefit, and other qualified andnon-qualified deferred compensation programs, the target replacement income is up to 60% of Final Average Pay and subject to the following conditions:

 

Under the SERP, Final Average Pay is defined as the average of the five highest calendar years of pay (base salary and annual incentive) out of the last ten years of employment with the Company.

 

 

JACK IN THE BOX INC.  ï  20192020 PROXY STATEMENT6163

 

  EXECUTIVE COMPENSATION  

    

 

Service is defined as the entire period of employment in calendar years and months while an eligible employee.

 

There is no reduction in the target replacement income (60%) if a participant has 20 or more years of service. For participants with less than 20 years of service, the target replacement income percentage is determined by multiplying the number of years of service times 3%, up to a maximum of 20 years.

 

To receive a retirement benefit under the SERP, a participant must attain the earlier of (i) age 62 or (ii) age 55 with ten years of service while employed at Jack in the Box or while disabled. A participant may begin receiving payments as early as age 55 subject to a reduction in benefits (equal to 5/12 of 1% for each month by which commencement of benefit payments precedes the participant’s attainment of age 62).

Benefits under the SERP are only available to retirees as monthly payments and cannot be received in a lump sum.

 

Death benefits are payable if a participant dies while employed.

 

The SERP provides for spousal joint and survivor annuities.

The following table provides information on the actuarial present value of the NEOs’ accumulated pension and SERP benefits as of the end of fiscal 20182019 (September 30, 2018)29, 2019), using fiscal 20182019 earnings (base salary and annual incentive). The maximum amounts used for the Retirement Plan do not exceed theIRS-prescribed limit applicable totax-qualified plans ($265,000 for 2015, the year the Retirement Plan was sunset). Present values were calculated using the interest rate and mortality assumptions used in the Company’s financial statements for fiscal year 2018.2019.

 

 

Pension Benefits TablePension Benefits Table Pension Benefits Table 
  Plan Name (1)  Number of Years
Credited Service
(#)		   Present Value of
Accumulated
Benefit at Normal
Retirement Age ($)  (2)		   Payments During
Last Year ($)		   Plan Name (1)  Number of Years
Credited Service
(#)		   

Present Value of
Accumulated
Benefit at Normal

Retirement Age ($) (2)

   

Payments During

Last Year ($)

 

Mr. Comma (CEO)

  

Retirement Plan

  

 

14

 

  

 

$   359,581

 

  

 

$           0

 

  

Retirement Plan

  

 

14

 

  

 

$   470,556

 

  

 

$           0

 

Mr. Tucker (CFO)

  

None

  

 

N/A

 

  

 

N/A

 

  

 

$           0

 

  

None

  

 

N/A

 

  

 

N/A

 

  

 

$           0

 

Mr. Rebel (former CFO)(3)

  Retirement Plan   12    $   520,320    $           0 
  

SERP

  

 

14

 

  

 

$6,606,005

 

  

 

$137,215

 

Dr. Blankenship (CSS)

  

Retirement Plan

  

 

18

 

  

 

$   667,000

 

  

 

$           0

 

  

Retirement Plan

  

 

18

 

  

 

$   798,600

 

  

 

$           0

 

  

SERP

  

 

20

 

  

 

$4,291,444

 

  

 

$           0

 

  

SERP

  

 

20

 

  

 

$5,106,040

 

  

 

$           0

 

Mr. Rudolph (CLO)

  

Retirement Plan

  

 

8

 

  

 

$   330,859

 

  

 

$           0

 

  

Retirement Plan

  

 

8

 

  

 

$   386,929

 

  

 

$           0

 

Mr. Melancon (SVP)

  

Retirement Plan

  

 

10

 

  

 

$   454,707

 

  

 

$           0

 

  

SERP

  

 

13

 

  

 

$2,562,585

 

  

 

$           0

 

Ms. Allen (former JIB President)

  

None

  

 

N/A

 

  

 

N/A

 

  

 

$           0

 

Mr. Tom (COO)

  

None

  

 

N/A

 

  

 

N/A

 

  

 

$           0

 

(1) 

Messrs. Comma, Rudolph, and Melancon and Dr. Blankenship participate in the Retirement Plan; additionally, Mr. Melancon and Dr. Blankenship areis the only NEOsNEO who participate in the SERP. Mr. Rebel is a vested participant in both the Retirement Plan and SERP.

(2) 

As of the end of fiscal 2018,2019, all fourthree Retirement Plan participants are vested in the Retirement Plan, and Dr. Blankenship and Mr. Melancon havehas met the service and minimum age requirements for vesting in the SERP. The actuarial present value of accumulated benefits under the Retirement Plan and the SERP is based on discount rates of 4.395%3.36% and 4.365%3.24% respectively, as of September 30, 2018.29, 2019. TheRP-2014 Mortality Table is used for both the Retirement Plan and the SERP calculations (the SERP uses a white collar adjustment). Both Plans use theMP-2017MP-2018 generational scale projected from 2006, modified to use 15 year15-year convergence to an ultimate rate of 0.75%. Participants are assumed to retire at the latest of current age and the plan’s earliest retirement date with unreduced benefits. Nopre-retirement mortality, retirement, or termination has been assumed for the present value factors.

(3)

Effective June 1, 2018, Mr. Rebel receives monthly benefits from the SERP, subject to asix-month delay pursuant to 409A regulations; the payment amount represents four months in fiscal 2018, subject to thesix-month delay. The present value of Mr. Rebel’s benefit under the SERP as of September 30, 2018 is based on his actual retirement date (May 1, 2018) and is reduced to reflect that his benefit will start before normal retirement age.

Non-Qualified Deferred Compensation

 

 

Executive Deferred Compensation Plan (EDCP)

In addition to eligibility to participate in the 401(k) Plan, the NEOs and other highly compensated employees are eligible to defer up to 50% of base salary and up to 85% of annual incentive pay to the EDCP, an unfunded,non-qualified deferred compensation plan, with benefits paid by the Company out of its general assets. The plan is subject to IRC Section 409A for all deferred compensation earned on or after January 1, 2005; deferred compensation earned prior to 2005 is not subject to Section 409A requirements and continues to be governed under the terms of the plan and tax laws in effect on or before

December 31, 2004, as applicable. In conjunctionTo provide participants with the 401(k) Plan changes that took effect January 1, 2016, the EDCP Company matching contribution (previously 100% of the first three percent of compensation deferred) was replaced with a “restoration matching contribution.” This means the Company will matchopportunity to receive up to the full four percent potential matching contribution offered in the 401(k), the Company provides a “restoration matching contribution” to the EDCP for participants whose deferrals to the 401(k) Plan (and related Company matching contributions) wereare limited due to the IRC limits

applicable to the 401(k) Plan. A participant must be employed on the last day of the calendar year to receive the restoration matching contribution, which is then 100% vested.

Participants choose from an array of investment options.

Enhanced EDCP — Beginning January 1, 2007, new executive officers who otherwise would have been eligible for the SERP received an additional annual Company contribution of 4% of base salary and annual incentive to their EDCP account for up to ten years. The two NEOs who received the enhanced EDCP, Mr. Comma and Mr. Rudolph, ended theirten-year period of receiving these contributions in January 2017 and November 2017, respectively. The supplemental contribution vested at a rate of 25% per year (such that participants were fully vested after completing four full years of service with the Company). The Enhanced EDCP was closed to new participants as of May 7, 2015.

 

 

6264    JACK IN THE BOX INC.  ï  20192020 PROXY STATEMENT

    

 

  EXECUTIVE COMPENSATION  

 

Company matching contributions made prior to January 1, 2016 vest at a rate of 25% per year (such that the match fully vests after completion of four full years of service with the Company). Participants choose from an array of investment options.

Enhanced EDCP — Beginning January 1, 2007, new Corporate Vice Presidents and above who otherwise would have been eligible for the SERP receive an additional annual Company contribution of 4% of base salary and annual incentive to their EDCP account for up to ten years. Theten-year period during which Mr. Comma and Mr. Rudolph received the additional 4% Company EDCP contribution came to an end in January 2017 and November 2017, respectively, at which time

they ceased receiving these contributions. Participants become vested in the supplemental contribution at the rate of 25% per year (such that they are fully vested after completing four full years of service with the Company). The Enhanced EDCP was closed to new participants as of May 7, 2015.

The following table provides information on the contributions, earnings, withdrawals and distributions in the Executive Deferred Compensation Plan during fiscal 20182019 and the

account balances as of the end of fiscal 2018.2019. As of September 30, 2018,29, 2019, all NEOs who participated in the Enhanced EDCP, except Ms. Allen, are 100% vested in Company contributions.

 

 

Non-Qualified Deferred Compensation Plan TableNon-Qualified Deferred Compensation Plan Table Non-Qualified Deferred Compensation Plan Table 
  Executive
Contributions in
Fiscal 2018(1)		   Registrant
Contributions In
Fiscal 2018(2)		   Aggregate
Earnings in
Fiscal 2018		   Aggregate
Withdrawals/
Distributions(3)		   Aggregate
Balance at
FYE18 (4)		   Executive
Contributions in
Fiscal 2019(1)		   Registrant
Contributions In
Fiscal 2019(2)		   Aggregate
Earnings in
Fiscal 2019		   Aggregate
Withdrawals/
Distributions		   Aggregate
Balance at
FYE19(3)		 

Mr. Comma (CEO)

  

 

$293,845

 

  

 

$59,944

 

  

 

$  52,304

 

  

 

$          —

 

  

$

4,117,234

 

  

 

$342,713

 

  

 

$70,435

 

  

 

$226,811

 

  

 

$          —

 

  

$

4,690,780

 

Mr. Tucker (CFO)

  

 

$           0

 

  

 

$         0

 

  

 

$           0

 

  

 

$          —

 

  

$

0

 

  

 

$103,931

 

  

 

$26,939

 

  

 

$           0

 

  

 

$          —

 

  

$

0

 

Mr. Rebel (Former CFO)

  

 

$  13,449

 

  

 

$  8,080

 

  

 

$  45,005

 

  

 

$  49,312

 

  

$

1,350,261

 

Dr. Blankenship (CSS)

  

 

$  24,682

 

  

 

$22,427

 

  

 

$132,467

 

  

 

$          —

 

  

$

2,585,271

 

  

 

$  29,149

 

  

 

$17,635

 

  

 

$196,477

 

  

 

$          —

 

  

$

2,818,481

 

Mr. Rudolph (CLO)

  

 

$  79,433

 

  

 

$33,757

 

  

 

$102,670

 

  

 

$          —

 

  

$

1,683,344

 

  

 

$  99,947

 

  

 

$28,829

 

  

 

$  91,196

 

  

 

$          —

 

  

$

1,875,132

 

Mr. Melancon (SVP)

  

 

$  48,930

 

  

 

$23,609

 

  

 

$  71,912

 

  

 

$          —

 

  

$

779,848

 

Ms. Allen (Former JIB President)

  

 

$  38,724

 

  

 

$  9,452

 

  

 

$  36,506

 

  

 

$623,915

 

  

$

0

 

Mr. Tom (COO)

  

 

$           0

 

  

 

$         0

 

  

 

$           0

 

  

 

$          —

 

  

$

0

 

(1) 

These amounts are also included in the salary andnon-equity incentive plan compensation columns in the 20182019 row of the SCT.

(2) 

These amounts represent only the restoration matching contributions in thenon-qualified EDCP and are reported as “All Other Compensation” in the SCT.SCT and represent a portion of the total amount reported as deferred compensation matching contribution in footnote 7 to the SCT, which also includes contributions to the 401(k).

(3) 

Upon their separation from the Company, Mr. Rebel and Ms. Allen received account distributions in accordance with their previous elections under the EDCP.

(4)

Amounts reported in this column are included in the “Salary” column in the SCT in prior years if the NEO was a named executive officer in previous years. The balance at FYE 20182019 reflects the cumulative value of each NEO’s deferrals, match, and investment gains or losses. These FYE amounts do not include contributions or earnings related to the fiscal 20182019 annual incentive payment which was paid after the end of fiscal 20182019 (but which amounts are included in the executive and registrant contributions columns of this table).

Potential Payments on Termination of Employment or Change in Control

 

 

Compensation & Benefits Assurance Agreements (CIC Agreements).The Company provides CIC Agreements because it considers it in the best interest of its stockholders to encourage continued employment of key management in the event of a CIC transaction. These agreements help facilitate successful performance by key executives during an impending CIC, by protecting them against the loss of their positions following a change in the ownership or control of the Company and ensuring that his or her expectations forlong-term incentive compensation arrangements will be fulfilled. Generally, under the agreements, a Company CIC is defined to include:

 

(i)

the acquisition by any person or group of 50% or more of the outstanding stock or combined voting power of the Company (excluding acquisitions by the fiduciary of the Company benefit plans or certain affiliates);

 

(ii)

circumstances in which individuals constituting our board of directors generally cease to constitute a majority of the board; and

 

(iii)

certain stockholder-approved mergers, consolidations, sales of assets or liquidation of the Company.

These CIC Agreements provide certain specified benefits to the executive if, within twenty-four (24) full calendar months following the effective date of a CIC, his or her employment is terminated (“Qualifying Termination”):

 

(i)

involuntarily other than for cause (which is defined in the agreements and includes acting deliberately and in bad faith or committing fraud), death, or disability, or

(ii)

voluntarily for good reason. Voluntary termination for good reason is generally defined as the executive’s resignation due to: (a) the assignment of the executive to duties or responsibilities inconsistent with his or her status, or a reduction or alteration in the nature or status of his or her duties or responsibilities in effect as of 90 days prior to the CIC event; (b) the acquiring company’s requirement that the executive be based at a location in excess of 50 miles from his or her location immediately prior to a CIC; (c) a material reduction in base salary; (d) a material reduction in the Company’s compensation, health and welfare, retirement benefit plans, or any perquisites, unless an alternative plan is provided of a comparable value; or (e) the Company’s failure to require any successor to assume the CIC Agreement benefits.

JACK IN THE BOX INC.ï  2019 PROXY STATEMENT63

  EXECUTIVE COMPENSATION  

CIC benefits under the CIC Agreements are not provided in the event of terminations by reason of death, disability, voluntary termination without good reason, or the Company’s involuntary termination of the executive’s employment for cause. CIC benefits under the CIC Agreements are also not provided in the event of a CIC when there is not a corresponding Qualifying Termination. In the event of a CIC of the Company and Qualifying Termination of an executive covered under a CIC Agreement as described above, the executive is entitled to the following severance benefits:

 

1.

A lump sum cash payment equal to his or her accrued but unpaid annual salary and unreimbursed business expenses.

 

JACK IN THE BOX INC.ï  2020 PROXY STATEMENT65

  EXECUTIVE COMPENSATION  

2.

A lump sum cash amount equal to a multiple of the executive’s then-current annual salary, based on his or her position, as follows:

 

    Multiple of Salary 

Mr. Comma

  

 

3.0x

 

Messrs. Rebel*, Rudolph and Tucker, Ms. Allen* and Dr. Blankenship

  

 

2.5x

 

Mr. MelanconTom

  

 

1.5x

 

*Applied

prior to the NEO’s termination.

 

3.

A lump sum cash incentive award equal to the multiple above times the greater of: (a) the average annual incentive percentage for the last three fiscal years prior to the CIC times annual salary; or (b) the average dollar amount of the annual incentive paid for the last three fiscal years prior to the CIC. If an executive does not have three full years of incentive awards, the Company will apply the target incentive award percentage for each missed year.

 

4.

Continuation of health insurance coverage at Company expense at the same cost and same coverage level as in effect as of the executive’s Qualifying Termination date (subject to changes in coverage levels applicable to all employees generally) for a specified coverage period as provided below, to run concurrently with any coverage provided under COBRA. If an executive receives health insurance coverage with a subsequent employer prior to the end of 18 months, the continuation of health insurance coverage under the agreement is discontinued.

 

    Coverage Period 

Mr. Comma

  

 

36 months

 

Messrs. Rebel*, Rudolph and Tucker, Ms. Allen* and Dr. Blankenship

  

 

30 months

 

Mr. MelanconTom

   18 months 
*Applied

prior to the NEO’s termination.

 

5.

Standard outplacement services at Company expense, from a nationally recognized outplacement firm selected by the executive, for a period of up to one year from the date of Qualifying Termination.

 

6.

Vesting of unvested restricted stock and RSUs, PSUs, andin-the-money stock options, in accordance with the terms of the applicable award agreement and stock incentive plan.

Since From 2014 through the end of fiscal 2019, all options and RSU awards provide that unvested units that continue after a CIC are “double-trigger”, requiring both a CIC and Qualifying Termination for vesting to accelerate. (For grants prior to 2014, and for PSU grants, no Qualifying Termination is required.) Since 2014, theThe terms of PSU awards provide for accelerated vesting upon a CIC that pays out at actual levels achieved for completed performance periods and at target level for incomplete periods. See Footnote 4 to the following table.

7.

No outstanding CIC agreements (or any other agreements with our NEOs) provide for any excise tax gross up for excess parachute payments under IRC Section 280G. (Mr. Rebel’spre-2009, grandfathered agreement had provided for a such agross-up in certain situations but was terminated upon his separation during 2018.) The remaining NEOs (excluding Ms. Allen whose agreement also terminated upon her separation in 2018) are parties to a CIC agreement, which provides for payment of the greater of: (i) the aggregate parachute payments reduced to the maximum amount that would not subject the executive to relevant excise taxes; or (ii) the aggregate parachute payments, with the executive paying the relevant excise taxes and such other applicable federal, state and local income and employment taxes. Under this “best after tax” provision, the executive is solely responsible for payment of excise taxes and other applicable federal, state, and local income and employment taxes.

Supplemental Executive Retirement Plan. For the three NEOsone NEO who areis a SERP participants,participant, in the event of an involuntary termination (or material diminution in duties or responsibilities or material downward change of title) within 24 months following a CIC, the SERP provides for payment to the participant of the actuarial equivalent of his accrued early retirement benefit unreduced for early commencement, in the form of three annual installments commencing on termination.

Non-Qualified Deferred Compensation.In the event of a CIC, in accordance with the EDCP, a participant shall become 100% vested in any Company contributions without regard to service requirements. Accounts shall be distributed in accordance with the participant’s existing distribution election (on termination of employment or under a scheduledin-service withdrawal).

Termination of Employment Without Change in Control.In the event of a termination not related to a CIC, NEOs will receive amounts under the terms and provisions of the specific plans in which they are a participant, including the Retirement Plan, the SERP and the EDCP.

Dr. Blankenship was the only fiscal-2019 NEO who is a SERP participant and will receive SERP benefits. He and Mr. MelanconRudolph are the only current NEOs who are SERP participants and eligible to retire under that plan. Messrs. Rudolph, Melancon and Dr. Blankenship are all eligible to retire under the Retirement Plan.

In addition, Dr. Blankenship and Mr. Rudolph are eligible to receive certain severance benefits that were approved by the Compensation Committee in connection with their actual or anticipated restructure-related separation from service in January and February 2020 respectively, as further described in the paragraph following the table and footnotes, below.

 

 

6466    JACK IN THE BOX INC.  ï  20192020 PROXY STATEMENT

    

 

  EXECUTIVE COMPENSATION  

 

Potential Payments on Termination of Employment or Change in Control

 

 

The following table helps illustrate the potential payments and benefits our current NEOs would be entitled to as of fiscal 20182019 year-end: (1) in the event of a termination of employment not related to a CIC, including termination due to death or disability; (2) in the event of a CIC and a Qualifying Termination, and (3) in the event of a CIC without a corresponding termination of employment. All references to “CIC” refer to a “Company CIC” as defined in theCompensation & Benefits Assurance Agreementssection.

The potential payments assume that the termination and/or

CIC occurred on the last day of fiscal 2018,2019, September 30, 2018,29, 2019, and, where applicable, use the closing price of our Common Stock of $83.83$90.45 on September 28, 201829, 2019 (the last market trading day in the fiscal year). The actual amounts to which an NEO may be eligible to receive can only be determined at the time of such termination or CIC, and therefore, the actual amounts will vary from the estimated amounts in the table below. (The benefits actually paid to Mr. Rebel and Ms. Allen upon their separations from the Company during 2018 are described following the table.)

 

 

  Lump Sum
Cash
Payment (1)		 Annual
Incentive (2)		 Continuation
of Benefits (3)		  Equity
Incentive
and Stock
Awards (4)		  Pension
and SERP
Benefits (5)		  Total
  Lump Sum
Cash
Payment (1)		 Annual
Incentive (2)		   Continuation
of Benefits (3)		   Equity
Incentive
and Stock
Awards (4)		   Pension
and SERP
Benefits (5)		   Total 

Mr. Comma (CEO)

              

 

 

 

 

 

   

 

   

 

   

 

Triggering Event

              

 

 

 

 

 

   

 

   

 

   

 

Voluntary/Involuntary Termination   —   —    —    —   $359,581   $359,581      —  —    —   $470,556   $470,556

Death

   —   —    —   $10,140,214   $359,581   $10,499,795      —  —   $11,756,374   $470,556   $12,226,930

Disability

   —   —    —   $10,016,046   $359,581   $10,375,627      —  —   $11,739,529   $470,556   $12,210,085

CIC/Qualifying Termination

  $2,775,000  $2,268,100  $52,682   $10,986,800   $359,581   $16,442,163    $2,775,000 $1,834,275 $57,108   $13,427,526   $470,556   $18,564,465

CIC/No Termination

   —   —    —   $3,662,725    —   $3,662,725      —  —   $4,641,463    —   $4,641,463

Mr. Tucker (CFO)

                         

Triggering Event

                         
Voluntary/Involuntary Termination   —   —    —    —    —   $0      —  —    —    —    —

Death

   —   —    —   $376,061    —   $376,061      —  —   $1,501,887    —   $1,501,887

Disability

   —   —    —   $376,061    —   $376,061      —  —   $1,501,887    —   $1,501,887

CIC/Qualifying Termination

  $1,437,500 (7)   $1,078,125   $45,569   $376,061    —   $376,061    $1,437,500 $1,151,797 $49,257   $1,790,131    —   $4,428,685

CIC/No Termination

   —   —    —    —    —   $2,937,225      —  —   $430,215    —   $430,215

Dr. Blankenship (CSS)

                         

Triggering Event

                         
Voluntary/Involuntary Termination   —   —    —   $565,380   $4,958,444   $5,523,824      —  —   $603,272   $5,904,640   $6,507,912

Death

   —   —    —   $565,380   $4,958,444   $5,523,824      —  —   $603,272   $5,904,640   $6,507,912

Disability

   —   —    —   $547,642   $4,958,444   $5,506,086      —  —   $601,273   $5,904,640   $6,505,913

CIC/Qualifying Termination

  $945,000  $579,915   $45,569   $669,144   $5,069,629   $7,309,257    $945,000 $468,957 $49,257   $801,714   $5,037,212   $7,302,140

CIC/No Termination

   —   —    —   $248,603    —   $248,603      —  —   $346,195    —   $346,195

Mr. Rudolph (CLO)

                         

Triggering Event

                         
Voluntary/Involuntary Termination   —   —    —   $2,228,842   $330,859   $2,559,701      —  —   $2,216,628   $386,929   $2,603,557

Death

   —   —    —   $2,228,842   $330,859   $2,559,701      —  —   $2,216,628   $386,929   $2,603,557

Disability

   —   —    —   $2,198,691   $330,859   $2,529,550      —  —   $2,213,155   $386,929   $2,600,084

CIC/Qualifying Termination

  $1,312,500  $805,438   $35,911   $2,405,225   $330,859   $4,889,933    $1,312,500 $651,328 $38,598   $2,561,338   $386,929   $4,950,693

CIC/No Termination

   —   —    —   $1,701,081    —   $1,701,081      —  —   $1,873,415    —   $1,873,415

Mr. Melancon (SVP)

           

Mr. Tom (COO)

              

Triggering Event

                         
Voluntary/Involuntary Termination   —   —    —   $249,014   $3,017,292   $3,266,306      —  —    —    —    —

Death

   —   —    —   $249,014   $3,017,292   $3,266,306      —  —   $514,118    —   $514,118

Disability

   —   —    —   $241,919   $3,017,292   $3,259,211      —  —   $514,118    —   $514,118

CIC/Qualifying Termination

  $507,000  $227,981   $31,341   $296,639   $2,466,848   $3,529,809    $487,500 (6)  $234,366 (6)  $33,554   $663,759    —   $1,419,179

CIC/No Termination

   —   —    —   $112,076    —   $112,076       —  —   $148,799    —   $148,799

 

(1) 

Lump Sum Cash Payment (“Cash Payment”):: For all NEOs, amounts shown in the table for a CIC/Qualifying Termination reflect a multiple of annual base salary under the CIC Agreement, as described in the Compensation and Benefits Assurance Agreements section (“CIC Section”) above.

(2) 

Annual IncentiveIncentive:: Reflects multiple of annual incentive as described in the CIC Section.

(3) 

Continuation of BenefitsBenefits:: Reflects benefits continuation as described in the CIC section, including an outplacement fee estimate of $10,000; and 100% vesting of company matching and supplemental contributions to the EDCP.

(4) 

Equity Incentive and Stock AwardsAwards:: The amounts shown in the table reflect only the value of unvested awards and options that would be accelerated upon termination and/or CIC as applicable; they do not include the vested portion of awards and options as of the end of fiscal 2018.2019. For Messrs.Mr. Rudolph Melancon and Dr. Blankenship, the NEOs who were

JACK IN THE BOX INC.ï  2019 PROXY STATEMENT65

  EXECUTIVE COMPENSATION  

retirement eligible at FYE 2018,2019, the value of their unvested equity that would be accelerated on termination (retirement), is shown in the “Voluntary/Involuntary Termination” row. For a CIC, the amounts shown reflect only the amount of acceleration of unvested restricted stock awards and stock units, unvested performance shares, andin-the-money unvested stock options. All references to termination exclude terminations for cause.

 

JACK IN THE BOX INC.ï  2020 PROXY STATEMENT67

  EXECUTIVE COMPENSATION  

 a)

Pre-2011 Stock Awards (RSA/RSU under the stock ownership program in place prior to fiscal 2011, for Messrs. Comma and Rudolph only):

 

 (i)

Upon termination not related to a CIC, if eligible to retire under a Company sponsored retirement plan, determination of shares vested is based on a schedule of the greater of: a) 30% of the award vesting three years from the date of grant, and 10% vesting for each year of service thereafter as of the date of retirement; b) such vesting as would have occurred had 10% of the award vested for each year of service with the Company, or c) in such greater amount as may be determined by the Board in its sole discretion.

 

 (ii)

Upon termination not related to a CIC, and not eligible to retire under a Company sponsored retirement plan, determination of shares vested is based on a schedule of 15% vesting on or after three years from the grant date, and 5% vesting for each year of service thereafter as of the termination date.

 

 (iii)

Upon death, disability, or a CIC, these stock awards would vest 100%.

 

 b)

Performance Shares (PSUs):

 

 (i)

Upon termination not related to a CIC, if eligible to retire under a Company sponsored retirement plan or due to death or disability, and the awardee had been continuously employed by the Company as of the last day of the first fiscal year of the performance period, the performance shares would vest on a prorated basis, based on the number of full accounting periods the awardee was continuously employed by the Company during the performance period and to the extent to which performance goals are achieved.

 

 (ii)

Upon termination not related to a CIC (other than as described above), the award would be cancelled.

 

 (iii)

Upon a CIC, PSUs would vest and pay out based on (A) actual achievement for completed fiscal years for which targets have been set and performance results measured and (B) at 100% of target for any incomplete fiscal years for which performance results are not known.

For the accelerated portion of PSUs for which performance was unknown as of the last day of fiscal 2018,2019, the amounts in the table assume that the PSUs will be accelerated based on target performance levels.

 

 c)

Time-vested RSUs:

 

 (i)

Upon termination not related to a CIC, disability, or retirement, the award would be cancelled.

 

 (ii)

Upon death, disability or retirement, the RSUs would vest 100%.

 

 (iii)

Upon a CIC, RSUs awarded prior to 2014 would vest 100%, and RSUs awarded since 2014 would vest only upon a Qualifying Termination, unless not assumed by an acquirer.

 

 d)

Option Awards:

 

 (i)

Upon termination not related to a CIC, and eligible to retire under a Company sponsored retirement plan, determination of shares vested is based on a formula of 5% additional vesting for each year of service with the Company.

 

 (ii)

Upon termination not related to a CIC, and not eligible to retire under a Company sponsored retirement plan, there is no acceleration of option awards.

 

 (iii)

Upon death, options would vest 100%.

 

 (iv)

Upon a CIC, where options are not assumed by the acquiring company, options awarded prior to 2014 would vest 100%, while those awarded since 2014 would vest 100% only upon a Qualifying Termination related to the CIC.

 

 (v)

Vesting upon disability is based on the number of shares which would have been vested as of twelve months following the optionee’s first day of absence from work with the Company, and therefore, for purposes of this table, no additional vesting is applied in the event of a disability.

 

(5) 

Pension and SERPSERP:: Annual benefit amounts listed for each NEO are subject to the eligibility and vesting provisions of the Retirement Plan (Messrs. Comma, Rudolph, Melancon and Dr. Blankenship) and the SERP (Dr. Blankenship and Mr. Melancon)Blankenshipn), which are described above in the sections of this Proxy Statement titled Retirement Plan, Supplemental Executive Retirement Plan and Pension Benefits Table, and accompanying footnotes. All values shown represent present values and are based on the following:

 

 a)

In the event of a voluntary/involuntary termination (for any reason) or death, benefit values are based on accrued benefits as of fiscalyear-end payable at normal retirement. Benefit values were calculated as of September 30, 2018,29, 2019, based on a discount rate of 4.395%3.36% for the qualified pension plan and 4.365%3.24% for the SERP. TheRP-2014 Mortality Table is used for both the Retirement Plan and the SERP calculations (the SERP uses a white collar adjustment). Both Plans use theMP-2017MP-2018 generational scale projected from 2006, modified to use 15 year15-year convergence to an ultimate rate of .75%. Under the SERP, which applies only to Mr. Melancon and Dr. Blankenship, in the event of death, the amount of the survivor benefit would be the greater of one times the participant’s compensation or the actuarial equivalent lump sum present value of the participant’s supplemental retirement benefit. In the event of death while actively employed, the amount of the benefit under the Retirement Plan would be the accrued actuarial equivalent pension benefit as determined on the date of death. Such benefit is not subject to any reduction of benefits.

 

 b)

Disability benefits shown assume an NEO terminates employment with the Company due to disability and remains continuously disabled until reaching normal retirement age. Benefit values are based on accrued benefits as of the NEOs normal retirement age and were calculated as of September 30, 201829, 2019 based on a discount rate of 4.395%3.36% for the qualified pension plan and 4.365%3.24% for the SERP and theRP-2014 Mortality Table as described above.

 

 c)

In the event of an involuntary termination (or material diminution in duties or responsibilities or material downward change of title) within 24 months following a CIC, a participant would become 100% vested in the SERP. Benefit values are based on accrued benefits as of fiscalyear-end and were calculated as of September 30, 2018.29, 2019. The SERP values are based on an interest rate of 6.0% and theRP-2000 Mortality Table, projected ten years.

 

 d)

As described in the“Non-Qualified Deferred Compensation Section” above, four of the NEOs received a 3% Company match on their contributions made to thenon-qualified deferred compensation (EDCP) prior to January 1, 2016, and an annual restoration match of up to 4% for contributions made after January 1, 2016. In addition, Messrs. Comma and Rudolph, who are not eligible to participate in the SERP, received an additional 4% Company contribution to their EDCP accounts for a maximum of ten years, which ceased in January 2017 for, Mr. Comma and in November 2017 for Mr. Rudolph. As of the end of fiscal 2018,2019, four of the NEOs, except Mr. TuckerTom who was hireddid not participate in March 2018,the EDCP, are 100% vested in the Company matching contributions. Accordingly, these amounts are not included here, but are described in the“Non-Qualified Deferred Compensation Section” above.

Former CFO,

(6)

The CIC Agreement “best after tax” provision applied to Mr. Tom at FYE19 would result in reducing his Cash Payment and a portion of his annual incentive payment so as to remain below the maximum amount he may receive without triggering an excise tax; the estimated reduction is $487,500 in his Cash Payment and a reduction of $41,107 in his annual incentive.

Dr. Blankenship ceased to be an officer and employee of our company in January 2020, and it is anticipated that Mr. Rebel, retired in May 2018.Rudolph will cease to be an officer and employee of our company at the end of February, 2020. In connection with histheir departure, Dr. Blankenship was and Mr. Rudolph will be eligible to receive, in exchange for entering into a separation and release agreement that includes a general release of claims against the Company, benefits providing for: (i) a lump sum cash payment of $567,000 for Dr. Blankenship and $686,538 for Mr. Rudolph, which represents compensation equal to 12 months base pay plus additional compensation based on years of service; (ii) if such officer is enrolled in the Company’s medical plan, COBRA medical coverage premiums for 12 months plus additional months based on years of service (up to a maximum of 18 months); and (iii) 12 months of outplacement services (such benefits in (a) through (c), the “Severance Benefits”). The aggregate amount of the Severance Benefits is expected to be $593,598 for Dr. Blankenship and $709,240 for Mr. Rudolph. Upon separation, Dr. Blankenship and Mr. Rudolph will each cease to be eligible for any benefits under the terms of his equity awards, he received benefits totaling $627,235, consisting of: (1) accelerated vesting of stock options, which would be valued at $49,736, had he exercised them on his separation date based on the difference between the closing price of our Common Stock on that date, May 1, 2018 ($89.41), and the exercise price of the options accelerated; and (2) accelerated vesting of RSUs valued at $577,499, based on the May 1, 2018 closing price of our Common Stock of ($89.41). In addition, as a result of his retirement, Mr. Rebel’s monthly payment distributions of his SERP benefits began (under which the estimated total that could be distributable to him during his lifetime is $6,606,005); and he will receive distribution of his Retirement Plan account in accordance with theCIC Agreements.

 

6668    JACK IN THE BOX INC.  ï  20192020 PROXY STATEMENT

    

 

  EXECUTIVE COMPENSATION  

 

termsPayment of the planSeverance Benefits to the individual is contingent upon such individual being satisfactorily employed by the Company through January 3, 2020, in the formcase of an annuity he elects on or before reaching his Normal Retirement age of 65 as describedDr. Blankenship, and February 28, 2020, in the “Retirement Plan Benefits” section above. The issuancecase of RSUsMr. Rudolph, or in each case, such earlier date as the Company may determine it no longer needs such officer’s services and paymentterminates their employment without cause, such definition as determined by the Compensation Committee of SERP benefits were subject to asix-month delay pursuant to 409A regulations.

In connection with the separation of former JIB President, Ms. Allen, in February 2018, she received $1,221,812 consisting of: (1) a lump sum cash payment of $515,000, equal toone-year of base pay pursuant to her August 2014 employment offer letter, and (2) an additional cash payment of $706,812, representing the value of cancelled equity awards and a lump sum cash payment in lieu of direct payment of COBRA medical premiums.Board (the “Compensation Committee”).

 

JACK IN THE BOX INC.  ï  20192020 PROXY STATEMENT6769

 

  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT  

    

 

SECURITY OWNERSHIP OF CERTAIN

BENEFICIAL OWNERS AND MANAGEMENT

The following tables set forth, as of January 25,December 30, 2019 (“the Record(the “Record Date”), information with respect to beneficial ownership of our Common Stock by (i) each person who we know to beneficially own more than 5% of our Common Stock, (ii) each director and nominee for director of the Company, (iii) each NEO listed in the Summary Compensation Table herein and (iv) all of our directors and executive officers (employed as of the Record Date) of the Company as a group. The address of each director and executive officer shown in the table below is c/o Jack in the Box Inc., 9330 Balboa Avenue,9357 Spectrum Center Blvd., San Diego, CA 92123.

We determined the number of shares of Common Stock beneficially owned by each person under rules promulgated by the SEC, based on information obtained from questionnaires, Company records and filings with the SEC. The information is not necessarily indicative of beneficial ownership for any other purpose. Under these rules, beneficial ownership includes any shares as to which the individual or entity has sole or shared voting power or investment power and also any shares which the individual or entity had the right to acquire within sixty days of January 25,December 30, 2019. All percentages are based on the shares of Common Stock outstanding as of January 25,December 30, 2019. Except as noted below, each holder has sole voting and investment power with respect to all shares of Common Stock listed as beneficially owned by that holder.

Security Ownership of Certain Beneficial Owners

 

 

Name  Number of Shares of
Common Stock
Beneficially Owned as of
January 25, 2019		   Percent
of Class		   Number of Shares of
Common Stock
Beneficially Owned as of
December 30, 2019		   Percent
of Class		 

BlackRock Inc. (1)

   3,105,778    12.0%    2,997,470    13.0% 

The Vanguard Group Inc. (2)

   2,334,262    9.0%    2,532,574    11.0% 

Blue Harbour Group, LP(3)

   1,847,547    7.2% 

Millennium Management LLC(3)

   1,242,681    5.4% 
(1) 

According to its Form 13F filings as of September 30, 2018,2019, BlackRock Inc. had investment discretion with respect to accounts holding 3,105,7782,997,470 shares, of which it had sole voting power with respect to 3,038,3772,932,915 shares and no voting power with respect to 67,40164,555 shares. The address of BlackRock Inc. is 55 East 52nd Street, New York NY 10055.

(2) 

According to its Form 13F filings as of September 30, 2018,2019, The Vanguard Group Inc., on behalf of itself and its direct subsidiaries, Vanguard Fiduciary Trust Co, and Vanguard Investments Australia, Ltd., had investment discretion with respect to accounts holding 2,334,2622,532,574 shares. The Vanguard Group Inc. was the beneficial owner of 2,301,6682,499,482 shares, of which it had sole voting power with respect to 2,9573,072 shares and no voting power with respect to 2,298,711 shares. Vanguard Fiduciary Trust Co was the beneficial owner of 28,64426,545 shares, of which it had sole voting power. Vanguard Investments Australia, Ltd. was the beneficial owner of 3,9503,475 shares, of which it had shared voting power. The address of The Vanguard Group, Inc. is P.O. Box 2600 Valley Forge, Pennsylvania 19482-2600.

(3) 

According to its Schedule 13D filingForm 13F filings as of November 9, 2018, Blue Harbour Group, LPSeptember 30, 2019, Millennium Management LLC. had investment discretion with respect to accounts holding 1,847,5471,242,681 shares, forof which it had sharedsole voting power.power with respect to 1,242,681 shares. The address of Blue Harbour Group, LPMillennium Management LLC is 646 Steamboat Road, Greenwich, CT 06830-7137.666 5th Avenue New York NY 10103.

 

6870    JACK IN THE BOX INC.  ï  20192020 PROXY STATEMENT

    

 

  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT  

 

Security Ownership Of Directors and Management

 

 

Name  Shares (1)   Options
Exercisable
Within 60
Days (2)		   Restricted
Shares(3)		   Deferred
Stock
Equivalents /
Units (4)		   Unvested
RSUs (5)		   Total Shares
Beneficially
Owned		   Percent of
Class (6)		   Shares (1)
Direct
Holdings		   Options
Exercisable
Within 60
Days (2)		   Restricted
Shares(3)		   Deferred
Stock
Equivalents /
Units (4)		   Unvested
RSUs (5)		   Total Shares
Beneficially
Owned		   Percent of
Class (6)		 

Mr. Comma

  

 

72,901

 

  

 

63,401

 

  

 

—

 

  

 

3,000

 

  

 

15,615

 

  

 

154,917

 

  

 

*   

 

  

 

69,928

 

  

 

98,673

 

  

 

—

 

  

 

3,000

 

  

 

34,700

 

  

 

206,301

 

  

 

*   

 

Mr. Tucker

  

 

—

 

  

 

—

 

  

 

—

 

  

 

—

 

  

 

—

 

  

 

—

 

  

 

*   

 

  

 

3,425

 

  

 

—

 

  

 

—

 

  

 

—

 

  

 

—

 

  

 

3,425

 

  

 

*   

 

Mr. Rebel

  

 

22,763

 

  

 

32,091

 

  

 

—

 

  

 

—

 

  

 

—

 

  

 

54,854

 

  

 

*   

 

Ms. Allen

  

 

7,501

 

  

 

—

 

  

 

—

 

  

 

—

 

  

 

—

 

  

 

7,501

 

  

 

*   

 

Dr. Blankenship

  

 

22,486

 

  

 

21,552

 

  

 

—

 

  

 

—

 

  

 

4,593

 

  

 

48,631

 

  

 

*   

 

  

 

17,523

 

  

 

21,552

 

  

 

—

 

  

 

—

 

  

 

3,396

 

  

 

42,471

 

  

 

*   

 

Mr. Rudolph

  

 

33,132

 

  

 

42,218

 

  

 

33,243

 

  

 

—

 

  

 

32,408

 

  

 

141,001

 

  

 

*   

 

  

 

20,290

 

  

 

43,778

 

  

 

33,243

 

  

 

—

 

  

 

30,669

 

  

 

127,980

 

  

 

*   

 

Mr. Melancon

  

 

3,707

 

  

 

11,477

 

  

 

—

 

  

 

—

 

  

 

1,420

 

  

 

16,604

 

  

 

*   

 

Mr. Tom

  

 

942

 

  

 

2,159

 

  

 

—

 

  

 

—

 

  

 

—

 

  

 

3,101

 

  

 

*   

 

Ms. Birch

  

 

—

 

  

 

—

 

  

 

—

 

  

 

—

 

  

 

824

 

  

 

824

 

  

 

*   

 

Mr. Gainor

  

 

600

 

  

 

—

 

  

 

—

 

  

 

—

 

  

 

824

 

  

 

1,424

 

  

 

*   

 

Mr. Goebel

  

 

10,524

 

  

 

—

 

  

 

—

 

  

 

6,905

 

  

 

1,000

 

  

 

18,429

 

  

 

*   

 

  

 

8,524

 

  

 

—

 

  

 

—

 

  

 

9,276

 

  

 

1,138

 

  

 

18,938

 

  

 

*   

 

Ms. John

  

 

2,433

 

  

 

—

 

  

 

—

 

  

 

975

 

  

 

1,000

 

  

 

4,408

 

  

 

*   

 

  

 

2,433

 

  

 

—

 

  

 

—

 

  

 

2,016

 

  

 

1,138

 

  

 

5,587

 

  

 

*   

 

Ms. Kleiner

  

 

6,556

 

  

 

—

 

  

 

—

 

  

 

6,668

 

  

 

1,000

 

  

 

14,224

 

  

 

*   

 

  

 

6,556

 

  

 

—

 

  

 

—

 

  

 

7,729

 

  

 

1,138

 

  

 

15,423

 

  

 

*   

 

Mr. Murphy

  

 

669

 

  

 

—

 

  

 

—

 

  

 

62,711

 

  

 

1,000

 

  

 

64,380

 

  

 

*   

 

  

 

—

 

  

 

—

 

  

 

—

 

  

 

64,796

 

  

 

1,138

 

  

 

65,934

 

  

 

*   

 

Mr. Myers

  

 

5,843

 

  

 

—

 

  

 

—

 

  

 

11,314

 

  

 

1,000

 

  

 

18,157

 

  

 

*   

 

  

 

5,843

 

  

 

—

 

  

 

—

 

  

 

13,646

 

  

 

1,138

 

  

 

20,627

 

  

 

*   

 

Mr. Tehle

  

 

3,477

 

  

 

—

 

  

 

—

 

  

 

47,151

 

  

 

1,000

 

  

 

51,628

 

  

 

*   

 

  

 

4,477

 

  

 

—

 

  

 

—

 

  

 

47,841

 

  

 

1,138

 

  

 

53,456

 

  

 

*   

 

Mr. Wyatt

  

 

6,044

 

  

 

—

 

  

 

—

 

  

 

9,667

 

  

 

1,000

 

  

 

16,711

 

  

 

*   

 

  

 

6,044

 

  

 

—

 

  

 

—

 

  

 

10,757

 

  

 

1,138

 

  

 

17,939

 

  

 

*   

 

Ms. Yeung

  

 

—

 

  

 

—

 

  

 

—

 

  

 

920

 

  

 

1,000

 

  

 

1,920

 

  

 

*   

 

  

 

—

 

  

 

—

 

  

 

—

 

  

 

2,979

 

  

 

1,138

 

  

 

4,117

 

  

 

*   

 

All Directors and Executive Officers as a Group (19 persons) (7)

  

 

190,685

 

  

 

165,510

 

  

 

33,243

 

  

 

149,311

 

  

 

65,723

 

  

 

604,472

 

  

 

2.3%

 

All Directors and Executive Officers as a Group (23 persons)

  

 

162,265

 

  

 

196,142

 

  

 

33,243

 

  

 

162,040

 

  

 

85,984

 

  

 

636,674

 

  

 

2.7%

 

 *

Asterisk in the percent of class column indicates beneficial ownership of less than 1%

(1)

Represents the number of shares of common stock beneficially owned on January 25, 2019, except for the two NEOs who separated from the Company prior to fiscal 2018year-end, Mr. Rebel and Ms. Allen, whose shares (and options) are as of December 31, 2018, based on information provided to the Company by each departed NEO.30, 2019.

(2)

Represents options that were exercisable on January 25,December 30, 2019 and options that become exercisable within 60 days of January 25,December 30, 2019.

(3)

Represents restricted stock awards held by Mr. Rudolph, which shares may be voted, but are not available for sale or other disposition until the expiration of vesting restrictions upon his termination of service.

(4)

Represents (a) for Mr. Comma, deferred performance vested restricted stock units, and (b) for directors, (i) Common Stock equivalents attributed to cash compensation deferred under the Director Deferred Compensation Plan and (ii) deferred RSUs and related dividends. (As described in the Director Compensation section of this Proxy Statement, these deferrals are convertible on aone-for-one basis into shares of Common Stock upon a director’s termination of service.)

(5)

Represents (a) for executive officers, RSUs that fully vest upon termination of service and are convertible on aone-for-one basis into shares of Common Stock upon vesting, and (b) for directors, RSUs that fully vest upon the earlier of 12 months from the date of grant or upon termination of service.

(6)

For purposes of computing the percentage of outstanding shares held by each person or group of persons named in the Beneficial Ownership table on a given date, any security which such person or persons has the right to acquire within 60 days after such date is deemed to be outstanding, but is not deemed to be outstanding for the purpose of computing the percentage ownership of any other person.

(7)

The number of shares of common stock and percentage ownership shown for “All Directors and Executive Officers as a Group” does not include any shares of common stock beneficially owned by Mr. Rebel or Ms. Allen, because they are not currently serving as executive officers.

 

JACK IN THE BOX INC.  ï  20192020 PROXY STATEMENT6971

 

  OTHER INFORMATION  

    

 

OTHER INFORMATION

SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

Pursuant to Section 16(a) of the Securities Exchange Act of 1934, each executive officer, each director, and each beneficial owner of more than 10% of the Company’s Common Stock is required to file certain forms with the SEC. A report of beneficial ownership of the Company’s Common Stock on Form 3 is due at the time such person becomes

subject to the reporting requirements and a report on Form 4 or Form 5 must be filed to reflect changes thereafter. Based on written statements and copies of forms provided to us by persons subject to the reporting requirements, we believe that all such reports required to be filed by such persons during fiscal 2018 were filed on a timely basis.

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

 

 

It is the Company’s policy that the Audit Committee approve or ratify transactions involving the Company and its directors, executive officers or principal stockholders or members of their immediate families or entities controlled by any of them or in which they have a substantial ownership interest in which the amount involved exceeds $120,000 and that are otherwise reportable under SEC disclosure rules.

During fiscal year 2018,2019, the Company was not a party to a transaction or series of transactions in which the amount involved did or may exceed $120,000 in which any of its directors, named executive officers or other executive officers, any holder of more than 5% of its Common Stock or any member of the immediate family of any of these persons had or will have a direct or indirect material interest, other than the compensation arrangements (including with respect to equity compensation) described in “Executive Compensation” above.

 

 

7072    JACK IN THE BOX INC.  ï  20192020 PROXY STATEMENT

    

 

  APPENDIX A  A—RECONCILIATION OF NON-GAAP MEASUREMENTS TO GAAP RESULTS  

 

APPENDIX A—RECONCILIATION OFNON-GAAP MEASUREMENTS TO GAAP RESULTS

This Proxy Statement contains information regarding Operating Earnings Per Share, Restaurant OperatingAdjusted EBITDA, Restaurant-Level Margin, Restaurant-Level EBITDA, and Operating EBIT, which arenon-GAAP financial measures. Management believes that these measurements, when viewed with the Company’s results of operations in accordance with GAAP and the accompanying reconciliations in the tables below, provide useful information about operating performance and period-over-period changes, and provide additional information that is useful for evaluating the operating performance of the company’s core business without regard to potential distortions. Additionally, Restaurant OperatingRestaurant-Level Margin and Operating EBIT were used by the Compensation Committee in determining annual incentive targets further discussed in the Proxy Statement.

However, Operating Earnings Per Share

Operating Earnings Per Share Restaurantrepresents diluted earnings per share from continuing operations on a GAAP basis excluding gains or losses on the sale of company-operated restaurants, restructuring charges, loss on early termination of interest rate swaps and debt extinguishment, thenon-cash impact of the Tax Act, and the excess tax benefits from share-based compensation arrangements. Operating Margin, Restaurant-Level EBITDA, and Operating EBIT are not measures of financial performance or liquidity under GAAP and, accordingly,Earnings Per Share should not be considered as alternatives to earnings from operations, net earnings, or other financial measures prepared in accordance with GAAP. The Company encourages investors to rely upon its GAAP numbers but includes thesenon-GAAP financial measures as supplemental metrics to assist investors. Thesenon-GAAP financial measures should not be considered as a supplement to, not as a substitute for, analysis of results as reported under U.S. GAAP or superior to, financial measures calculated in accordance with GAAP. In addition, thesenon-GAAP financial measures used by the Company may be calculated differently from, and therefore may not be comparable to,other similarly titled measures used byof other companies.

Below is Management believes Operating Earnings Per Share provides investors with a reconciliationmeaningful supplement ofnon-GAAP Restaurant Operating Margin the company’s operating performance and Restaurant-Level EBITDAperiod-over-period changes without regard to the most directly comparable GAAP measure, earnings from operations (in thousands).

   52 Weeks Ended 
    September 30,
2018		      October 1,
2017		      

Earnings from operations (1) — GAAP

   $ 231,614       $ 242,053      

Other operating expenses, net:(2)

      

Selling, general and administrative expenses

   (106,649)    (120,640)   

Impairment and other charges, net

   (18,418)    (13,169)   

Gains on the sale of company-operated restaurants

   46,164       38,034      

Total other operating income (expenses), net

   $  (78,903)       $  (95,775)      

Franchise operations: (2)

      

Franchise rental revenues

   $ 259,047    $ 231,578   

Franchise royalties and other

   162,585       149,792      

Total franchise revenues

   421,632    381,370   

Franchise occupancy expenses

   (158,319)    (140,623)   

Franchise support and other costs

   (11,593)    (8,811)   

Amortization of franchise tenant improvement allowances

   862       121      

Franchise EBITDA —non-GAAP(3)

   252,582   59.9%   232,057    60.8% 

Depreciation and amortization(3)

   (34,332)   8.1%   (30,860)    8.1% 

Amortization of franchise tenant improvement allowances(3)

   (862)   0.2%   (121)    —% 

Franchise Margin —non-GAAP(2)(3)

   $ 217,388   51.6%   $ 201,076    52.7% 

Company restaurant operations: (2)

      

Company restaurant sales

   $ 448,058    $ 715,921   

Food and packaging(4)

   (128,947)   28.8%   (206,653)    28.9% 

Payroll and employee benefits(4)

   (129,089)   28.8%   (211,611)    29.6% 

Occupancy and other(4)

   (71,803)   16.0%   (124,367)    17.4% 

Restaurant-Level EBITDA —non-GAAP(4)

   118,219   26.4%   173,290    24.2% 

Depreciation and amortization(4)

   (16,458)   3.7%   (29,084)    4.1% 

Restaurant Operating Margin —non-GAAP(2)(4)

   $ 101,761   22.7%   $ 144,206    20.1% 

Depreciation and amortization:

      

Company restaurant occupancy and other

   $  (16,458)    $  (29,084)   

Franchise occupancy expenses

   (34,332)    (30,860)   

Impairment and other charges, net

   (235)    (51)   

Selling, general and administrative expenses

   (8,397)       (7,403)      

Total depreciation and amortization

   $  (59,422)       $  (67,398)      
(1)

Earnings from operations is the sum of total other operating expenses, net, Franchise EBITDA, Restaurant-Level EBITDA, and depreciation and amortization, plus the amortization of franchise tenant improvement allowances.

(2)

Restaurant operating margin and franchise margin do not include an allocation of other operating expenses, such as selling, general and administrative expenses which include the costs of shared service functions such as accounting/finance and human resources, and other unallocated costs such as pension expense and shared-based compensation. As such, restaurant operating margins and franchise margins are not indicative of the overall results of the Company and are consideredNon-GAAP financial measures. Restaurant operating margin and franchise margin should be considered a supplement to, not as a substitute for, earnings from operations, net earnings or other financial measures prepared in accordance with US GAAP, or other similarly titled measures of other companies.

(3)

Percentages are calculated based on a percentage of total franchise revenues.

(4)

Percentages are calculated based on a percentage of company restaurant sales.

JACK IN THE BOX INC.ï  2019 PROXY STATEMENTA-1

  APPENDIX A  

potential distortions.

Below is a reconciliation ofnon-GAAP Operating Earnings Per Share to the most directly comparable GAAP measure, diluted earnings per share from continuing operations. Figures may not add due to rounding.

 

  52 Weeks Ended
  52 Weeks Ended   

September 29, 

2019 

 September 30, 
2018 
  

September 30,

2018

 

October 1,

2017

 

Diluted earnings per share from continuing operations — GAAP

  

 

$ 3.62

 

 

 

$ 4.16

 

                   $3.52                 $3.62

Loss on early termination of interest rate swaps and debt extinguishment

    0.64  —

Gains on the sale of company-operated restaurants

  

 

(1.16

) 

 

 

(0.78

) 

    (0.04)  (1.16)

Restructuring charges

  

 

0.27

 

 

 

0.07

 

    0.24  0.27

Non-cash impact of the Tax Cuts and Jobs Act

  

 

1.13

 

 

 

—

 

    —  1.13

Excess tax benefits from share-based compensation arrangements

  

 

(0.07

) 

 

 

—

 

Operating Earnings Per Share —non-GAAP

  

 

$ 3.79

 

 

 

$ 3.46

 

Excess tax benefits from share based compensation arrangements

    —  (0.07)

Operating earnings per share —Non-GAAP

                   $4.35                 $3.79

Adjusted EBITDA

Adjusted EBITDA represents net earnings on a GAAP basis excluding earnings or losses from discontinued operations, income taxes, interest expense, net, gains or losses on the sale of company-operated restaurants, impairment and other charges, net, depreciation and amortization, and the amortization of franchise tenant improvement allowances and other. Adjusted EBITDA should be considered as a supplement to, not as a substitute for, analysis of results as reported under U.S. GAAP or other similarly titled measures of other companies. Management believes Adjusted EBITDA is useful to investors to gain an understanding of the factors and trends affecting the company’s ongoing cash earnings, from which capital investments are made and debt is serviced.

JACK IN THE BOX INC.ï  2020 PROXY STATEMENTA-1

  APPENDIX A—RECONCILIATION OF NON-GAAP MEASUREMENTS TO GAAP RESULTS  

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

   52 Weeks Ended
    September 29, 
2019 		 September 30, 
2018 

Net earnings — GAAP

               $94,437              $121,371

Earnings from discontinued operations, net of income taxes

    (2,690)   (17,032)

Income taxes

    24,025   81,728

Interest expense, net

    84,967   45,547

Gains on the sale of company-operated restaurants

    (1,366)   (46,164)

Impairment and other charges, net

    12,455   18,418

Depreciation and amortization

    55,181   59,422

Amortization of franchise tenant improvement allowances and other

    1,983   862

Adjusted EBITDA —Non-GAAP

               $268,992              $264,152

Restaurant Level Margin

Restaurant-Level Margin is defined as company restaurant sales less restaurant operating costs (food and packaging, payroll and employee benefits, and occupancy and other costs) and is neither required by, nor presented in accordance with GAAP. Restaurant-Level Margin excludes revenues and expenses of our franchise operations and certain costs, such as selling, general, and administrative expenses, depreciation and amortization, impairment and other charges, net, gains or losses on the sale of company-operated restaurants, and other costs that are considered normal operating costs. As such, Restaurant-Level Margin is not indicative of the overall results of the company and does not accrue directly to the benefit of shareholders because of the exclusion of corporate-level expenses. Restaurant-Level Margin should be considered as a supplement to, not as a substitute for, analysis of results as reported under GAAP or other similarly titled measures of other companies. The company is presenting Restaurant-Level Margin because it believes 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 utilizes Restaurant-Level Margin as a key performance indicator to evaluate the profitability of company-owned restaurants. Additionally, Restaurant-Level Margin is one of the metrics used in determining payouts under the 2019 Annual Incentives.

Below is a reconciliation ofnon-GAAP Restaurant-Level Margin to the most directly comparable GAAP measure, earnings from operations (in thousands):

   52 Weeks Ended
    September 29,    
2019    		 September 30,    
2018    

Earnings from operations — GAAP

               $202,223              $233,447

Franchise rental revenues

    (272,815)   (259,047)

Franchise royalties and other

    (169,811)   (162,585)

Franchise contributions for advertising and other services

    (170,674)   —

Franchise occupancy expenses

    166,584   158,319

Franchise support and other costs

    12,110   11,593

Franchise advertising and other services expenses

    178,093   —

Selling, general and administrative expenses

    76,357   104,816

Impairment and other charges, net

    12,455   18,418

Gains on the sale of company-operated restaurants

    (1,366)   (46,164)

Depreciation and amortization

    55,181   59,422

Restaurant-Level Margin —Non-GAAP

               $88,337              $118,219

Company restaurant sales

               $336,807              $448,058

Restaurant-Level Margin % —Non-GAAP

    26.2%   26.4%

A-2    JACK IN THE BOX INC.ï  2020 PROXY STATEMENT

  APPENDIX A—RECONCILIATION OF NON-GAAP MEASUREMENTS TO GAAP RESULTS  

Operating EBIT

Operating EBIT represents net earnings on a GAAP basis excluding earnings or losses from discontinued operations, income taxes, interest expense, net, gains or losses on the sale of company-operated restaurants and restructuring charges. Management believes Operating EBIT is useful to investors to gain an understanding of the factors and trends affecting the company’s ongoing cash earnings, from which capital investments are made and debt is serviced. Additionally, Operating EBIT is one of the metrics used in determining payouts under the 2019 Annual Incentives. Operating EBIT should be considered as a supplement to, not as a substitute for, analysis of results as reported under U.S. GAAP or other similarly titled measures of other companies.

Below is a reconciliation ofnon-GAAP Operating EBIT used for the 2018 Annual Incentives, to the most directly comparable GAAP measure, net earnings (in thousands).

 

52 Weeks Ended
    

52 Weeks Ended 
September 30,

2018

29, 2019 

Net earnings — GAAP

  

$121,371

94,437

Losses (earnings)Earnings from discontinued operations, net of income taxes

  

(17,032

(2,690

)

Income taxes

  

81,728

24,025

Interest expense, net

  

45,547

Earnings from operations

 

84,967

231,614

Gains on the sale of company-operated restaurants

  

(46,164

(1,366

)

Restructuring charges

  

10,647

Shared services and unallocated costs

 

8,455

74,098

Operating EBIT —non-GAAPNon-GAAP

  

$270,195

207,828

 

A-2JACK IN THE BOX INC.  ï  20192020 PROXY STATEMENTA-3

LOGO

 

    JACK IN THE BOX INC.INC.

    9330 BALBOA AVENUE

    SAN DIEGO, CALIFORNIA 92123

  

LOGO

  

 

VOTE BY INTERNET -www.proxyvote.com or scan the QR Barcode above

Use the Internet to transmit your voting instructions and for electronic delivery of information up until 11:59 P.M. Eastern Time the day before thecut-off date or meeting date. Follow the instructions to obtain your records and to create an electronic voting instruction form

 

  

ELECTRONIC DELIVERY OF FUTURE PROXY MATERIALS

If you would like to reduce the costs incurred by our company in mailing proxy materials, you can consent to receiving all future proxy statements, proxy cards and annual reports electronically viae-mail or the Internet. To sign up for electronic delivery, please follow the instructions above to vote using the Internet and, when prompted, indicate that you agree to receive or access proxy materials electronically in future years.

 

  

VOTE BY PHONE -1-800-690-6903

Use any touch-tone telephone to transmit your voting instructions up until 11:59 P.M. Eastern Time the day before thecut-off date or meeting date. Have your proxy card in hand when you call and then follow the instructions.

 

  

VOTE BY MAIL

Mark, sign and date your proxy card and return it in the postage-paid envelope we have provided or return it to Vote Processing, c/o Broadridge, 51 Mercedes Way, Edgewood, NY 11717.

 

TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS:

E55016-P15051E88362-P31752                KEEP THIS PORTION FOR YOUR RECORDS

— — — — — — — — — — — — —  — — — — — — — — — — — — — — — — — — — —  — — — — — — — — — — — — — — — —

        DETACH AND RETURN THIS PORTION ONLY
THIS PROXY CARD IS VALID ONLY WHEN SIGNED.                        

 

    

 

 

JACK IN THE BOX INC.

 

                      
  

The Board of Directors recommends you vote FOR all 910 nominees listed and FOR proposals 2 and 3.

 

    
      1. 

Election of Directors

 

  For  Against  Abstain            
    

Nominees:

 

         For  Against  

For

Against

Abstain

  
        

1a.   Jean M. Birch

1b.  Leonard A. Comma

 

1b.  David L. Goebel

1c.  SharonJohn P. JohnGainor

  

☐

 

☐

 

☐

  

☐

 

☐

 

☐

  

☐

 

☐

 

☐

  

 

 

 

2.

 

 

3.

  

1j.  Vivien M. Yeung

 

 

Ratification of the appointment of KPMG LLP as independent registered public accountants.

 

Advisory approval of executive compensation.

 

☐

 

 

☐

 

 

☐

 

☐

 

 

☐

 

 

☐

 

☐

 

 

☐

 

 

☐

  
    

1d.  Madeleine A. KleinerDavid L. Goebel

 

1e.  Michael W. MurphySharon P. John

  

☐

 

☐

  

☐

 

☐

  

☐

 

☐

         
    

 

1f.  James M. MyersMadeleine A. Kleiner

  

 

☐

  

 

☐

  

 

☐

          
    

 

1g.  David M. TehleMichael W. Murphy

  

 

☐

  

 

☐

  

 

☐

          
    

 

1h.  John T. WyattJames M. Myers

  

 

☐

  

 

☐

  

 

☐

  

 

NOTE:In their discretion, the proxies are authorized to vote upon such other business as may properly come before the meeting or any adjournment thereof.

     
    

 

1i.  VivienDavid M. YeungTehle

  

 

☐

  

 

☐

  

 

☐

 
  
   For address changes and/or comments, please check this box and write them on the back where indicated.      ☐       
  
   Please indicate if you plan to attend this meeting.  ☐  ☐            
         Yes  No              
   Please sign exactly as your name(s) appear(s) hereon. When signing as attorney, executor, administrator, or other fiduciary, please give full title as such. Joint owners should each sign personally. All holders must sign. If a corporation or partnership, please sign in full corporate or partnership name by authorized officer.          
                       
 
                      
       
      
 
                         
    Signature [PLEASE SIGN WITHIN BOX]  Date     Signature (Joint Owners) Date        

 

 

Important Notice Regarding the Availability of Proxy Materials for the Annual Meeting:

The Proxy Statement and the 20182019 Annual Report on Form10-K are available at www.proxyvote.com.

 

 

— — — — — — — — — — — —  — — — — — — — — — — — — — — — — — — — —  — — — — — — — — — — — — — — — — —

E55017-P15051E88363-P31752      

 

          
    

JACK IN THE BOX INC.

Annual Meeting of Stockholders

March 1, 2019,February 28, 2020, 8:30 a.m., Pacific Time

This proxy is solicited by the Board of Directors

   
       
  

The undersigned hereby appoints Leonard A. Comma and Phillip H. Rudolph, and each of them, with power to act without the other and with power of substitution, as proxies andattorneys-in-fact and hereby authorizes them to represent and vote, as provided on the other side, all the shares of Jack in the Box Inc. Common Stock which the undersigned is entitled to vote, and, in their discretion, to vote upon such other business as may properly come before the 20192020 Annual Meeting of Stockholders of the company to be held March 1, 2019,February 28, 2020, or at any adjournment or postponement thereof, with all powers which the undersigned would possess if present at the Annual Meeting.

 

THIS PROXY WILL BE VOTED AS DIRECTED, OR IF NO DIRECTION IS INDICATED, WILL BE VOTED “FOR” THE ELECTION OF ALL DIRECTORS AND “FOR” PROPOSALS 2 AND 3.

 

In their discretion, the proxies are authorized to vote upon such other business as may properly come before the Annual Meeting or any adjournment thereof.

 

 

  
   

      

   

Address Changes/Comments:                                                                                                                                                       

        
   
    

                                                                                                                                                                                                           

   
   
  

        

              
     

 

(If you noted any Address Changes/Comments above, please mark corresponding box on the reverse side.)

 

Continued and to be signed on reverse side