Prior to January 1, 2011, which Del Taco employees were covered by the Qualified Plan?
Del_Taco Franchise · 2025 FDDAnswer from 2025 FDD Document
on a pre-tax basis. Our contributions under the non-qualified deferred compensation plan were $0.2 million in fiscal year 2024, $0.1 million in fiscal year 2023, and less than $0.1 million in fiscal year 2022.
Defined benefit pension plans — We sponsor two defined benefit pension plans, a "Qualified Plan" covering substantially all full-time employees hired prior to January 1, 2011, and an unfunded supplemental executive retirement plan ("SERP") which provides certain employees additional pension benefits and was closed to new participants effective January 1, 2007. In fiscal 2011, the Board of Directors approved changes to our Qualified Plan whereby participants no longer accrue benefits effective December 31, 2015. Benefits under both plans are based on the employees' years of service and compensation over defined periods of employment.
In the fourth quarter of fiscal 2023, the Company amended its Qualified Plan to purchase certain annuity contracts from a third-party company, relieving the Company of its related obligation for future payment (the "Annuity Purchase
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 58)
What This Means (2025 FDD)
According to Del Taco's 2025 Franchise Disclosure Document, the "Qualified Plan" is a defined benefit pension plan that covered substantially all full-time Del Taco employees hired prior to January 1, 2011. This plan, along with an unfunded supplemental executive retirement plan (SERP), provided retirement benefits based on employees' years of service and compensation over defined periods of employment. The SERP was closed to new participants effective January 1, 2007.
In fiscal year 2011, Del Taco's Board of Directors approved changes to the Qualified Plan, stipulating that participants would no longer accrue benefits after December 31, 2015. This means that while the plan continued to exist, employees stopped earning additional benefits under it from that date forward. In the fourth quarter of fiscal year 2023, Del Taco amended its Qualified Plan to purchase annuity contracts from a third-party company for $14.4 million, transferring the obligation for future payments to the third party and reducing the plan's pension benefit obligation (PBO).
For a prospective franchisee, understanding the details of Del Taco's retirement plans is less directly relevant than understanding the costs and obligations of offering similar benefits to their own employees. However, it provides insight into the company's historical approach to employee compensation and benefits, which can inform expectations about current and future practices. Franchisees may want to inquire about current employee benefit programs and any potential changes to those programs that could affect their operating costs.