UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 FORM 11-K
 ANNUAL REPORT
PURSUANT TO SECTION 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
(Mark One)
x
ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934. [NO FEE REQUIRED].

For the fiscal year ended April 30, 2020.
OR
 
o
TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934. [NO FEE REQUIRED].
For the transition period from              to             
Commission File Number 1-13666
 
A.
Full title of the plan and the address of the plan, if different from that of the issuer named below:
Darden Savings Plan
 
B.
Name of issuer of the securities held pursuant to the plan and the address of its principal executive office:
DARDEN RESTAURANTS, INC.
1000 Darden Center Drive
Orlando, Florida 32837






DARDEN SAVINGS PLAN
Table of Contents
 
  
Page
 
 
Report of Independent Registered Public Accounting Firm
1

 
 
Statements of Net Assets Available for Benefits
2

 
 
Statements of Changes in Net Assets Available for Benefits
4

 
 
Notes to Financial Statements
6

 
 
Supplemental Schedules
 
 
 
Schedule H, Line 4a – Schedule of Delinquent Participant Contributions
15

 
 
Schedule H, Line 4i – Schedule of Assets (Held at End of Year)
16





Report of Independent Registered Public Accounting Firm
To the Plan Participants and Plan Administrator
Darden Savings Plan:

Opinion on the Financial Statements
We have audited the accompanying statements of net assets available for benefits of the Darden Savings Plan (the Plan) as of April 30, 2020 and 2019, the related statements of changes in net assets available for benefits for the years then ended, and the related notes (collectively, the financial statements). In our opinion, the financial statements present fairly, in all material respects, the net assets available for benefits of the Plan as of April 30, 2020 and 2019, and the changes in net assets available for benefits for the years then ended, in conformity with U.S. generally accepted accounting principles.
Basis for Opinion
These financial statements are the responsibility of the Plan’s management. Our responsibility is to express an opinion on these financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Plan in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.
Accompanying Supplemental Information
The accompanying schedules of Schedule H, Line 4a - Schedule of Delinquent Participant Contributions for the year ended April 30, 2020 and Schedule H, Line 4i - Schedule of Assets (Held at End of Year) as of April 30, 2020 have been subjected to audit procedures performed in conjunction with the audit of the Plan’s financial statements. The supplemental information is the responsibility of the Plan’s management. Our audit procedures included determining whether the supplemental information reconciles to the financial statements or the underlying accounting and other records, as applicable, and performing procedures to test the completeness and accuracy of the information presented in the supplemental information. In forming our opinion on the supplemental information, we evaluated whether the supplemental information, including its form and content, is presented in conformity with the Department of Labor’s Rules and Regulations for Reporting and Disclosure under the Employee Retirement Income Security Act of 1974. In our opinion, the supplemental information is fairly stated, in all material respects, in relation to the financial statements as a whole.

/s/ KPMG LLP

We have served as the Plan’s auditor since 1997.
Orlando, Florida
October 19, 2020








DARDEN SAVINGS PLAN
Statement of Net Assets Available for Benefits
April 30, 2020
 
 
 
Participant
directed
funds
 
ESOP Funds
(Note 7)
 
Total
Assets:
 
 
 
 
 
 
Investments:
 
 
 
 
 
 
Investments, at fair value
 
$
622,185,172

 
$
723,748

 
$
622,908,920

Common stock of Darden Restaurants, Inc. – allocated
 
62,080,339

 
131,031,338

 
193,111,677

Total investments
 
684,265,511

 
131,755,086

 
816,020,597

Receivables:
 
 
 
 
 
 
Employer contributions
 
7,498,431

 

 
7,498,431

Receivable for investments sold
 
135,845

 

 
135,845

Accrued dividends and interest
 
186

 
90

 
276

Notes receivable from Participants
 
22,564,910

 

 
22,564,910

Total receivables
 
30,199,372

 
90

 
30,199,462

Total assets
 
714,464,883

 
131,755,176

 
846,220,059

Liabilities:
 
 
 
 
 
 
Payable for investments purchased
 
2,038,482

 

 
2,038,482

Total liabilities
 
2,038,482

 

 
2,038,482

Net assets available for benefits
 
$
712,426,401

 
$
131,755,176

 
$
844,181,577

 
 
 
 
 
 
 
See accompanying notes to financial statements.

2



DARDEN SAVINGS PLAN
Statement of Net Assets Available for Benefits
April 30, 2019
 
 
 
Participant
directed
funds
 
ESOP Funds
(Note 7)
 
Total
Assets:
 
 
 
 
 
 
Investments:
 
 
 
 
 
 
Investments, at fair value
 
$
616,015,130

 
$
1,276,747

 
$
617,291,877

Common stock of Darden Restaurants, Inc. – allocated
 
89,511,828

 
215,546,335

 
305,058,163

Common stock of Darden Restaurants, Inc. – unallocated
 

 
17,120,914

 
17,120,914

Total investments
 
705,526,958

 
233,943,996

 
939,470,954

Receivables:
 
 
 
 
 
 
Employer contributions
 
3,968,350

 

 
3,968,350

Accrued dividends and interest
 
598,720

 
1,499,626

 
2,098,346

Notes receivable from Participants
 
21,085,816

 

 
21,085,816

Total receivables
 
25,652,886

 
1,499,626

 
27,152,512

Total assets
 
731,179,844

 
235,443,622

 
966,623,466

Liabilities:
 
 
 
 
 
 
ESOP loans
 

 
736,360

 
736,360

Interest payable
 

 
772

 
772

Total liabilities
 

 
737,132

 
737,132

Net assets available for benefits
 
$
731,179,844

 
$
234,706,490

 
$
965,886,334

See accompanying notes to financial statements.


3



DARDEN SAVINGS PLAN
Statement of Changes in Net Assets Available for Benefits
Year ended April 30, 2020
 
 
 
Participant
directed
funds
 
ESOP Funds
(Note 7)
 
Total
Additions (deductions) to net assets attributed to:
 
 
 
 
 
 
Investment loss:
 
 
 
 
 
 
Net depreciation in fair value of investments
 
$
(70,978,918
)
 
$
(80,329,975
)
 
$
(151,308,893
)
Dividends and interest
 
17,231,254

 
5,046,919

 
22,278,173

Net investment loss
 
(53,747,664
)
 
(75,283,056
)
 
(129,030,720
)
Notes receivable from Participants activity during the year:
 
 
 
 
 
 
Interest
 
1,182,778

 

 
1,182,778

Total notes receivable from Participants activity
 
1,182,778

 

 
1,182,778

Contributions:
 
 
 
 
 
 
Participants
 
63,699,759

 

 
63,699,759

Employer
 
26,411,819

 

 
26,411,819

Total contributions
 
90,111,578

 

 
90,111,578

 
 
 
 
 
 
 
Total additions (deductions)
 
37,546,692

 
(75,283,056
)
 
(37,736,364
)
Deductions from net assets attributed to:
 
 
 
 
 
 
Benefits paid to participants
 
(68,182,843
)
 
(13,587,902
)
 
(81,770,745
)
Interest expense
 

 
(7,319
)
 
(7,319
)
Administrative expenses
 
(2,126,349
)
 
(63,980
)
 
(2,190,329
)
Transfers between funds
 
14,009,057

 
(14,009,057
)
 

Total deductions
 
(56,300,135
)
 
(27,668,258
)
 
(83,968,393
)
 
 
 
 
 
 
 
Net decrease
 
$
(18,753,443
)
 
$
(102,951,314
)
 
$
(121,704,757
)
Net assets available for benefits:
 
 
 
 
 
 
Beginning of year
 
731,179,844

 
234,706,490

 
965,886,334

End of year
 
$
712,426,401

 
$
131,755,176

 
$
844,181,577

See accompanying notes to financial statements.

4



DARDEN SAVINGS PLAN
Statement of Changes in Net Assets Available for Benefits
Year ended April 30, 2019
 
 
 
Participant
directed
funds
 
ESOP Funds
(Note 7)
 
Total
Additions to net assets attributed to:
 
 
 
 
 
 
Investment income:
 
 
 
 
 
 
Net appreciation in fair value of investments
 
$
42,224,463

 
$
51,771,104

 
$
93,995,567

Dividends and interest
 
14,845,531

 
6,185,117

 
21,030,648

Net investment income
 
57,069,994

 
57,956,221

 
115,026,215

Notes receivable from Participants activity during the year:
 
 
 
 
 
 
Interest
 
989,712

 

 
989,712

Total notes receivable from Participants activity
 
989,712

 

 
989,712

Contributions:
 
 
 
 
 
 
Participants
 
54,814,427

 

 
54,814,427

Employer
 
37,617,917

 

 
37,617,917

Total contributions
 
92,432,344

 

 
92,432,344

 
 
 
 
 
 
 
Total additions
 
150,492,050

 
57,956,221

 
208,448,271

Deductions from net assets attributed to:
 
 
 
 
 
 
Benefits paid to participants
 
(64,078,808
)
 
(14,220,912
)
 
(78,299,720
)
Interest expense
 

 
(30,300
)
 
(30,300
)
Administrative expenses
 
(1,958,228
)
 
(110,809
)
 
(2,069,037
)
Transfers between funds
 
8,615,970

 
(8,615,970
)
 

Total deductions
 
(57,421,066
)
 
(22,977,991
)
 
(80,399,057
)
 
 
 
 
 
 
 
Net increase
 
$
93,070,984

 
$
34,978,230

 
$
128,049,214

Net assets available for benefits:
 
 
 
 
 
 
Beginning of year
 
638,108,860

 
199,728,260

 
837,837,120

End of year
 
$
731,179,844

 
$
234,706,490

 
$
965,886,334

See accompanying notes to financial statements.

5

DARDEN SAVINGS PLAN
Notes to Financial Statements
April 30, 2020 and 2019

 
(1)
Description of the Plan
The following description of the Darden Savings Plan (the Plan or DSP) provides only general information. Participants should refer to official Plan documents and the summary plan description for a more complete description of the Plan’s provisions.
General
The Plan is a defined contribution plan sponsored by Darden Restaurants, Inc. (Company or Darden). The Plan was originally effective as of June 1, 1973, but was most recently amended and restated effective as of January 1, 2016 and has been subsequently amended. The Plan is subject to applicable provisions of the Employee Retirement Income Security Act of 1974 (ERISA). The assets of the Plan are held and invested through the Darden Savings Plan Trust (the Trust). The Plan covers certain employees of the Company’s subsidiaries, and their divisions and affiliates who meet the Plan’s age and service requirements.
Participants are permitted to defer into the Plan on both an “after-tax” and “before-tax” basis. The Internal Revenue Code (the Code) limits the amount of before-tax contributions that can be made to the Plan each year. The limit for Plan participants under age 50 was $19,500 in 2020 and $19,000 in 2019. Participants who were at least age 50 or older during the year were permitted to make an additional “catch-up contribution” of $6,500 in 2020 and $6,000 in 2019.
Employee Contributions
Qualified employees who are at least 21 years of age may immediately begin making before-tax and after-tax contributions to the Plan upon commencement of employment. Generally, qualified employees may contribute 1% to 25% of eligible compensation to the Plan. Plan participants age 50 or older, who make maximum before-tax contributions to the Plan, may generally make an additional catch-up contribution.
Employer Contributions
Generally, qualified employees who are at least age 21 and complete a year of service are eligible for Company Matching Contributions. Salaried qualified employees are also generally eligible for a Retirement Plus Contribution (RPC).
Company Matching Contributions
For the calendar quarters beginning April 1, 2019, July 1, 2019, October 1, 2019, and January 1, 2020, the Company made a variable matching contribution ranging from 25% to 120% of an employee’s contributions, up to the first 6% of eligible compensation contributed to the Plan. Effective for calendar quarters beginning on or after April 1, 2020, the Company Matching Contribution is determined separately each calendar quarter at the Company's discretion and can range from a minimum of 0% to a maximum of 120% of an employee's contributions, up to the first 6% of eligible compensation contributed to the Plan. Company Matching Contributions are generally contributed to the Plan on a quarterly basis. For calendar quarters ending prior to April 1, 2020, Company Matching Contributions were funded through the Employee Stock Ownership Plan (ESOP) component of the Plan, the non-ESOP component of the Plan, or a combination of both. Effective for calendar quarters beginning on and after April 1, 2020, the ESOP loan was repaid in full and Company Matching Contributions are made only through the non-ESOP component of the Plan. Company Matching Contributions are invested in Darden common stock through the ESOP portion of the Plan or in accordance with participant investment elections through the non-ESOP portion of the Plan.
DSP Advantage Bonus and DSP Advantage Matching Allocations
Prior to January 1, 2009, the Plan made DSP Advantage Bonus and DSP Advantage Matching Allocations to certain restaurant management and Restaurant Support Center administrative employees that had at least five years of service with the Company. Contributions were made in the form of Darden common stock through the ESOP portion of the Plan.

6

DARDEN SAVINGS PLAN
Notes to Financial Statements
April 30, 2020 and 2019

DSP Retirement Plus Contribution
Eligible employees need not make contributions to the Plan to be eligible to receive RPCs. Prior to calendar quarters beginning April 1, 2020, RPCs were made on a quarterly basis and equaled 1.5% of eligible compensation. Effective for calendar quarters beginning on or after April 1, 2020, the amount of the RPC may vary from quarter to quarter at the discretion of the Company and may equal 0% of eligible compensation. In our most recent quarter beginning April 1, 2020, the RPC equaled 1.5% of eligible compensation. Prior to calendar quarters beginning April 1, 2020, RPCs were funded through the ESOP component of the Plan, the non-ESOP component of the Plan, or a combination of both. Effective for calendar quarters beginning on and after April 1, 2020, RPCs were made only through the non-ESOP component of the Plan. RPCs are invested in Darden common stock through the ESOP portion of the Plan or in accordance with participant investment elections through the non-ESOP portion of the Plan.
Distributions and In-Service Withdrawals
Active employees may take regular, hardship and DSP Advantage withdrawals from the Plan, subject to certain limitations prescribed by the Plan. The Company also implemented the expanded in-service withdrawal options available under the Coronavirus Aid, Relief and Economic Security Act (CARES Act).
Upon termination of employment, participants are entitled to receive a distribution of their entire vested account balance. The vested portion of a participant’s account will automatically be distributed in a lump sum distribution at termination if the vested balance of a participant’s account is $1,000 or less. Terminated participants who have a vested account balance greater than $1,000 may elect either to receive a lump sum distribution or to leave their account in the Plan. The Plan charges a quarterly fee to terminated participants who leave their accounts in the Plan.
Vesting
Each participant is 100% vested in all employee contributions to the Plan and DSP Advantage Allocations, including earnings on all such amounts. Company Matching Contributions and RPC allocations are vested at a rate of 5% for each fiscal quarter beginning with the participant’s fifth quarter of service. An employee is fully vested after completion of 24 fiscal quarters of vesting service (except in the event of retirement, severance, divestiture or death) based on a participant’s years of service and is forfeited if a participant leaves prior to completing such vesting service requirements.
ESOP Fund
The Plan purchased Company stock held in the Darden ESOP Fund (Note 7) using the proceeds of the ESOP loans. There is currently no ESOP loan outstanding payable as the Company fully repaid the outstanding loan balance in December 2019. The ESOP loan was secured by a pledge of the purchased Company stock. As ESOP loan repayments were made, the ESOP Trustee released the leveraged shares. The Plan then used these released shares to fund certain Company Matching Contributions and certain RPCs, which were then allocated to eligible participants’ ESOP accounts.
Dividends are also automatically reinvested in participants’ ESOP accounts unless a participant has elected to receive such dividends in cash. Participants are able to immediately transfer ESOP funds credited to their ESOP accounts to any of the Plan’s other investment funds. However, amounts may not be transferred from any of the other investment funds into the ESOP Fund.
Plan Administration
Wells Fargo Institutional Retirement and Trust (Trustee), a business unit of Wells Fargo Bank, N.A., serves as trustee and recordkeeper of the Plan. Wells Fargo Bank, N.A. is wholly-owned by Wells Fargo & Company. Principal Financial Group Inc. acquired Wells Fargo's Institutional Retirement and Trust business in 2019.
Each participant is entitled to exercise voting rights attributable to the common stock of the Company shares allocated to his or her account and is notified prior to the time that such rights are to be exercised. The Trustee will vote any allocated shares for which instructions have not been given by a participant and any unallocated shares in the same proportion as votes received.
Additionally, as of March 19, 2015, Newport Trust (formally known as Evercore Trust) was appointed as the independent fiduciary and investment manager for the Company Stock Fund held in the Plan. Newport Trust will act as a fiduciary within the meaning of Section 3(21) of ERISA and an investment manager within the meaning of Section 3(38) of ERISA.

(2)
Summary of Significant Accounting Policies

(a)Basis of Presentation
The financial statements of the Plan are prepared under the accrual-basis method of accounting in accordance with U.S. generally accepted accounting principles.

(b)Investments
The Plan’s investments include funds that invest in various types of investment securities and in various companies within various markets. Investment securities are exposed to several risks, such as interest rate, market and credit risks. Due to the level of risk associated with certain investment securities, it is at least reasonably possible that changes in the values of investment securities will occur in the near term and that such changes could materially affect participants’ account balances and the amounts reported in the Plan’s financial statements and schedule.

7

DARDEN SAVINGS PLAN
Notes to Financial Statements
April 30, 2020 and 2019

As of April 30, 2020, 24% of the Plan’s investments are in the common stock of the Company. Accordingly, changes in the value of the Company’s common stock could have a greater effect on the Plan’s financial statements than other Plan investments.

(c)Notes Receivable from Participants
Notes receivable from Participants are recorded at their unpaid principal balance plus any accrued but unpaid interest. Participants may borrow from their vested account as follows: a minimum of $1,000 during the majority of the plan year but reduced to $500 as of April 28, 2020 up to a maximum equal to the lesser of $50,000, minus the highest outstanding loan balance in the preceding 12 months even if repaid; 50% of their vested account balance; or the vested balance in the participant’s account excluding the Participant’s ESOP and RPC accounts. The loan amount may not result in loan repayments that exceed 50% of the participant’s 13 week average net take-home pay. Loan repayment terms generally may not exceed 5 years, unless the Participant receives a principal residence loan, in which case the loan repayment term can be up to 15 years. The loans are secured by the balance in the participant’s account and bear market rates of interest. Principal and interest are paid through payroll deductions and may be repaid in full at any time without penalty. As of April 30, 2020, interest rates ranged from 4.25% to 9.50% and loans mature through February 21, 2035. The Company also implemented the expanded participant loan relief available under the CARES Act.

(d)Use of Estimates
The preparation of financial statements, in accordance with U.S. generally accepted accounting principles, requires the Plan administrator to make estimates and assumptions that affect the reported amounts of net assets available for benefits at the date of the financial statements and the reported amounts of additions to and deductions from those net assets during the reporting period. Actual results could differ from those estimates.

(e) Application of New Accounting Standards
The Plan has not adopted any new accounting standards in the current plan year. Other applicable accounting standards that have been issued by the Financial Accounting Standards Board or other standards-setting bodies that do not require adoption until a future date are not expected to have a material impact on the financial statements upon adoption.

(3)
Forfeitures
Forfeitures of nonvested Company contributions to the Plan can be used in any order of priority to: (i) pay Plan expenses, to the extent not paid by the Company, (ii) restore amounts previously forfeited by participants but required to be reinstated upon resumption of employment, (iii) correct an error made in allocating amounts to participants' accounts, (iv) be allocated to participants' accounts in the proportion that each participant's earnable compensation bears to the earnable compensation of all participants for the Plan year, or (v) fund contributions that the Company or a participating employer would otherwise make in accordance with the terms of the Plan or guidance prescribed by the Internal Revenue Service or another government agency, including corrective qualified nonelective contributions. During the 2020 and 2019 Plan years, $1,155,105 and $1,305,696, respectively, of forfeitures were used to pay administrative expenses of the Plan. Forfeited funds were not used for any other reason during Plan years 2020 and 2019. Additionally, as of April 30, 2020 and 2019 forfeitures available for future use totaled $0 and $364,789, respectively.

(4)
Choice of Investments
As of April 30, 2020, all contributions may be directed to 19 basic investment alternatives: Columbia Trust Stable Government I-0 Fund, DFA US Small Cap Portfolio, TS&W Collective/International Large Cap Equity Fund, Vanguard Institutional Index Fund Plus, Vanguard Target Retirement 2060 Fund, Vanguard Target Retirement 2055 Fund, Vanguard Target Retirement 2050 Fund, Vanguard Target Retirement 2045 Fund, Vanguard Target Retirement 2040 Fund, Vanguard Target Retirement 2035 Fund, Vanguard Target Retirement 2030 Fund, Vanguard Target Retirement 2025 Fund, Vanguard Target Retirement 2020 Fund, Vanguard Target Retirement 2015 Fund, Vanguard Institutional Target Retirement Income Fund, Vanguard Total Bond Market Index Fund, Vanguard Extended Market Index Fund, Vanguard Total International Stock Index Institutional Fund, and Darden Common Stock.


8

DARDEN SAVINGS PLAN
Notes to Financial Statements
April 30, 2020 and 2019

(5)
Fair Value Measurement
Plan investments are recorded at fair value. Short-term investments are stated at cost, which approximates fair value. Shares of common stock are valued at closing market prices and shares of mutual funds are valued at quoted market prices, which represent the net asset value of shares held by the mutual fund at year end.
Investments in common collective trusts are valued using a Readily Determinable Fair Value (RDFV) based on the fair value of the underlying securities in which the account is invested. The RDFV is used if the fair value per share is determined and published and is the basis for current transactions. There are currently no redemption restrictions or unfunded commitments on these investments.
Purchases and sales of securities are recorded on a trade-date basis. Dividend income is recorded on the ex-dividend date. Interest income, net realized and unrealized gains or losses, and administrative expenses are recorded on the accrual basis. The cost of investment securities sold is determined on the weighted average basis. Deposits and withdrawals are made at fair value determined as of the end of the business day of the transaction. When it was still outstanding (i.e., for the Plan year ending April 30, 2019), the ESOP loan was stated at cost, which approximated fair value because the loan bore interest at rates commensurate with loans of similar credit quality and duration as of year-end. The fair values of receivables and interest payable approximate their carrying amounts due to their short duration.
The following table summarizes the fair values of financial instruments measured at fair value on a recurring basis at April 30, 2020:
 
 
Fair value
of assets
at April 30,
2020
 
Quoted prices
in active
markets for
identical assets
(Level 1)
 
Significant
other
observable
inputs
(Level 2)
 
Significant
unobservable
inputs
(Level 3)
Darden common stock
 
$
193,111,677

 
$
193,111,677

 
$

 
$

Short-term investments
 
4,419,142

 
4,419,142

 

 

Mutual funds
 
539,907,131

 
539,907,131

 

 

Common collective trust
 
78,582,647

 

 
78,582,647

 

Total
 
$
816,020,597

 
$
737,437,950

 
$
78,582,647

 
$

 
 
The following table summarizes the fair values of financial instruments measured at fair value on a recurring basis at April 30, 2019:
 
 
Fair value
of assets
at April 30,
2019
 
Quoted prices
in active
markets for
identical assets
(Level 1)
 
Significant
other
observable
inputs
(Level 2)
 
Significant
unobservable
inputs
(Level 3)
Darden common stock
 
$
322,179,077

 
$
322,179,077

 
$

 
$

Short-term investments
 
3,884,654

 
3,884,654

 

 

Mutual funds
 
536,191,349

 
536,191,349

 

 

Common collective trust
 
77,215,874

 

 
77,215,874

 

Total
 
$
939,470,954

 
$
862,255,080

 
$
77,215,874

 
$

    
For the years ended April 30, 2020 and 2019, there were no investments classified as level 3 nor were there any transfers between levels 1, 2, or 3.

(6)
Common Stock of Darden Restaurants, Inc.
At April 30, 2020 and 2019, the fair value of the shares held in non-ESOP Fund participant directed accounts was $62,080,339 (841,311 shares) and $89,511,828 (761,155 shares), respectively. For further information on the Company, participants should refer to the Company’s consolidated financial statements included in the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission.


9

DARDEN SAVINGS PLAN
Notes to Financial Statements
April 30, 2020 and 2019

(7)
ESOP Funds
The Plan previously entered into several ESOP loan transactions and borrowed money from the Company to purchase shares of Company stock. The Company made its final ESOP loan repayments in December 2019. Prior to repayment, these ESOP loans were secured by pledges of the purchased Company stock. The ESOP Trustee held the purchased shares (also referred to as leveraged shares) in a designated ESOP Fund, along with some cash held in short-term investments. As ESOP loan repayments were made, the ESOP Trustee released these shares. The Plan could use these released shares to fund Company Matching Contributions and RPCs, which were then allocated to eligible participants’ ESOP accounts.
After the final ESOP loan repayments, the same general rules continue to apply to the participants' ESOP accounts. Dividends are automatically reinvested in participants’ ESOP accounts unless a participant has elected to receive such dividends in cash. Participants are able to immediately transfer ESOP funds credited to their ESOP accounts to any of the Plan’s other investment funds. However, amounts may not be transferred from any of the other investment funds into the ESOP Fund. Shares used to fund Company contributions reduce the net assets of the non-participant directed portion of the ESOP fund and increase the net assets of the participant directed funds. These contributions are included as transfers between funds on the accompanying statements of changes in net assets available for benefits.
At April 30, 2020 and 2019, the Darden ESOP Fund consists of 1,775,733 and 1,978,463 shares, respectively, of Darden's common stock. Of the total shares held by the Darden ESOP Fund, 1,775,733 shares at April 30, 2020 and 1,832,877 shares at April 30, 2019 of Darden's common stock have been allocated to individual participant accounts. The remaining 0 shares at April 30, 2020 and 145,586 shares at April 30, 2019 of Darden's common stock, which are held by the ESOP Trustee, are unallocated (suspense) shares reserved for future Company Matching Contributions or RPCs. At April 30, 2020, the fair value of the 1,775,733 allocated shares was $131,031,338. At April 30, 2019, the fair value of the 145,586 unallocated Company shares was $17,120,914 and the fair value of the 1,832,877 allocated shares was $215,546,335. Cash dividends on unallocated shares of Company stock can be used to repay promissory notes, pay Plan expenses, or fund the RPCs.
The Darden ESOP Fund had one promissory note payable to the Company (Original Loan), with an outstanding principal balance of $736,360 as of April 30, 2019 which was paid off in December 2019. The note bore interest at variable rates payable on a monthly, bi-monthly, or quarterly basis at the discretion of the Company. As of April 30, 2019, the interest rate on the Original Loan was 1.8956%. The Original Loan had no required principal payments on the remaining note balance until its maturity date on December 15, 2019. Any or all of the principal could have been prepaid at any time. For the years ended April 30, 2020 and 2019, the Darden ESOP Fund made principal payments of $736,360 and $1,115,954, respectively.

10

DARDEN SAVINGS PLAN
Notes to Financial Statements
April 30, 2020 and 2019

Information about the net assets and significant components of the changes in net assets relating to the ESOP Funds as of and for the years ended April 30, 2020 and 2019 is presented in the following tables:
ESOP Funds Statement of Net Assets Available for Benefits
April 30, 2020
 
 
Non-participant
 Directed
 
Participant
 Directed
 
Total
Assets:
 
 
 
 
 
 
Investments:
 
 
 
 
 
 
Investments, at fair value
 
$

 
$
723,748

 
$
723,748

Common stock of Darden Restaurants, Inc. – allocated
 

 
131,031,338

 
131,031,338

Total investments
 

 
131,755,086

 
131,755,086

Receivables:
 
 
 
 
 
 
Accrued dividends and interest
 

 
90

 
90

Total receivables
 

 
90

 
90

Total assets
 

 
131,755,176

 
131,755,176

Net assets available for benefits
 
$

 
$
131,755,176

 
$
131,755,176

 
 
 
 
 
 
 
ESOP Funds Statement of Net Assets Available for Benefits
April 30, 2019
 
 
Non-participant
 Directed
 
Participant
 Directed
 
Total
Assets:
 
 
 
 
 
 
Investments:
 
 
 
 
 
 
Investments, at fair value
 
$

 
$
1,276,747

 
$
1,276,747

Common stock of Darden Restaurants, Inc. – allocated
 

 
215,546,335

 
215,546,335

Common stock of Darden Restaurants, Inc. – unallocated
 
17,120,914

 

 
17,120,914

Total investments
 
17,120,914

 
216,823,082


233,943,996

Receivables:
 
 
 
 
 
 
Accrued dividends and interest
 
109,311

 
1,390,315

 
1,499,626

Total receivables
 
109,311

 
1,390,315

 
1,499,626

Total assets
 
17,230,225

 
218,213,397

 
235,443,622

Liabilities:
 
 
 
 
 
 
ESOP loans
 
736,360

 

 
736,360

Interest payable
 
772

 

 
772

Total liabilities
 
737,132

 

 
737,132

Net assets available for benefits
 
$
16,493,093

 
$
218,213,397

 
$
234,706,490

 
 


 
 
 
 


11

DARDEN SAVINGS PLAN
Notes to Financial Statements
April 30, 2020 and 2019

ESOP Funds Statement of Changes in Net Assets Available for Benefits
Year ended April 30, 2020
 
 
Non-participant
 Directed
 
Participant
 Directed
 
Total
Additions (deductions) to net assets attributed to:
 
 
 
 
 
 
Net depreciation in fair value of investments
 
$
(1,771,015
)
 
$
(78,558,960
)
 
$
(80,329,975
)
Dividends and interest
 
231,636

 
4,815,283

 
5,046,919

Total deductions
 
(1,539,379
)
 
(73,743,677
)
 
(75,283,056
)
 
 
 
 
 
 
 
Deductions from net assets attributed to:
 
 
 
 
 
 
Benefits paid to participants
 

 
(13,587,902
)
 
(13,587,902
)
Interest expense
 
(7,319
)
 

 
(7,319
)
Administrative expenses
 

 
(63,980
)
 
(63,980
)
Transfers between funds
 
(14,946,395
)
 
937,338

 
(14,009,057
)
Total deductions
 
(14,953,714
)
 
(12,714,544
)
 
(27,668,258
)
 
 
 
 
 
 
 
Net decrease
 
$
(16,493,093
)
 
$
(86,458,221
)
 
$
(102,951,314
)
Net assets available for benefits:
 
 
 
 
 
 
Beginning of year
 
16,493,093

 
218,213,397

 
234,706,490

End of year
 
$

 
$
131,755,176

 
$
131,755,176

ESOP Funds Statement of Changes in Net Assets Available for Benefits
Year ended April 30, 2019
 
 
Non-participant
 Directed
 
Participant
 Directed
 
Total
Additions to net assets attributed to:
 
 
 
 
 
 
Net appreciation in fair value of investments
 
$
4,952,913

 
$
46,818,191

 
$
51,771,104

Dividends and interest
 
546,042

 
5,639,075

 
6,185,117

Total additions
 
5,498,955

 
52,457,266

 
57,956,221

 
 
 
 
 
 
 
Deductions from net assets attributed to:
 
 
 
 
 
 
Benefits paid to participants
 

 
(14,220,912
)
 
(14,220,912
)
Interest expense
 
(30,300
)
 

 
(30,300
)
Administrative expenses
 
(44,128
)
 
(66,681
)
 
(110,809
)
Transfers between funds
 
(7,271,874
)
 
(1,344,096
)
 
(8,615,970
)
Total deductions
 
(7,346,302
)
 
(15,631,689
)
 
(22,977,991
)
 
 
 
 
 
 
 
Net (decrease) increase
 
$
(1,847,347
)
 
$
36,825,577

 
$
34,978,230

Net assets available for benefits:
 
 
 
 
 
 
Beginning of year
 
18,340,440

 
181,387,820

 
199,728,260

End of year
 
$
16,493,093

 
$
218,213,397

 
$
234,706,490


(8)
Party-in-Interest Transactions
Certain Plan investments are in common stock of the Company and money market funds managed by the Trustee, and therefore, these transactions qualify as party-in-interest transactions. However, such transactions qualify for prohibited transaction exemptions. The Company pays the Trustee’s administrative and trustee fees. Such fees, inclusive of fees paid by plan forfeitures and fees paid by terminated participants used to cover plan expenses, were $1,628,334 and $1,749,647 for the years ended April 30, 2020 and 2019, respectively.

12

DARDEN SAVINGS PLAN
Notes to Financial Statements
April 30, 2020 and 2019

Certain Plan assets are loans to participants who are employees of the Company; therefore, these transactions qualify as party-in-interest transactions. However, such transactions qualify for prohibited transaction exemptions. Terminated participants that elect to leave their accounts in the Plan are required to pay quarterly fees; therefore, these transactions also qualify as party-in-interest transactions. However, such transactions qualify for prohibited transaction exemptions. Fees paid by terminated participants were $284,810 and $299,899 for the years ended April 30, 2020 and 2019, respectively.

(9)
Reconciliation of Financial Statements to Form 5500
The following is a reconciliation of net assets available for plan benefits per the accompanying financial statements to Form 5500:
 
 
2020
 
2019
Net assets available for benefits per the accompanying financial statements
 
$
844,181,577

 
$
965,886,334

Notes receivable from Participants – deemed distributions
 
(1,291,854
)
 
(884,898
)
Net assets available for benefits per Form 5500
 
$
842,889,723

 
$
965,001,436


The following is a reconciliation of total deductions to net assets, net, per the accompanying financial statements to Form 5500:
 
 
2020
 
2019
Total deductions per the accompanying financial statements
 
$
83,968,393

 
$
80,399,057

Deemed distributed notes receivable from Participants offset by total distributions
 
406,955

 
61,144

Total deductions per Form 5500
 
$
84,375,348

 
$
80,460,201

    
Amounts allocated to deemed distributions of notes receivable from Participants are recorded as a receivable in the accompanying financial statements and recorded as an expense on Form 5500.

A note receivable from a Participant is deemed distributed during the plan year for the Form 5500 under the provisions of the Code section 72(p) and the Treasury Regulation section 1.72(p) if the note receivable is treated as a note receivable solely of the participant’s individual account and the participant has discontinued payment of the note receivable as of the end of the year. However, in accordance with U.S. generally accepted accounting principles, for the accompanying financial statements the note receivable balance is still considered an outstanding note receivable until the note receivable obligation has been satisfied and is not treated as an actual distribution until such time the participant separates from employment and the participant’s vested account balance is fully distributed.

(10)
Tax Status
The Plan obtained a determination letter on June 23, 2017, in which the Internal Revenue Service (IRS) stated that the Plan, as restated effective January 1, 2016, was in compliance with the applicable requirements of the Code. Although the Plan has been amended since receiving the determination letter, the Company believes that the Plan currently is designed and being operated in compliance with the applicable requirements of the Code, and therefore, the Plan qualifies under Sections 401(a) and 4975(e)(7) and the related Trust is tax exempt as of April 30, 2020. Therefore, no provision for income taxes has been included in the Plan’s financial statements.
U.S. generally accepted accounting principles require Plan management to evaluate uncertain tax positions taken by the Plan. The financial statement effects of a tax position are recognized when the position is more likely than not, based on the technical merits, to be sustained upon examination by the IRS. The Plan administrator has analyzed the tax positions taken by the Plan, and has concluded that as of April 30, 2020 there were no uncertain positions taken or expected to be taken. The Plan has recognized no interest or penalties related to uncertain tax positions. The Plan is subject to routine audits by taxing jurisdictions; however, there are no audits for any tax periods in progress. The Plan Administrator believes it is no longer subject to income tax examinations for plan years ended through April 30, 2017.

13

DARDEN SAVINGS PLAN
Notes to Financial Statements
April 30, 2020 and 2019


(11)
Delinquent Contributions
During the plan year ending April 30, 2019, the Company had an unintentional delay related to the transmission of participant contributions and loan repayments to the Plan. At the time, the Company was ineligible to correct this late contribution error by utilizing the Voluntary Fiduciary Correction Program (VFCP) as the Plan was under a DOL audit. The Company self-corrected the error by wiring the late contributions and loan repayments on April 15, 2019 and subsequently remitting lost earnings of $570.21 on May 24, 2019. See accompanying supplemental Schedule H, Line 4a - Schedule of Delinquent Participant Contributions for further information.

(12)
Plan Termination
Although it has not expressed any intent to do so, the Company has the right under the Plan to discontinue its contributions at any time and to terminate the Plan subject to the provisions of the Employee Retirement Income Security Act of 1974. In the event of Plan termination, no further contributions shall be made to the Plan by either the Company or the participants, participants would become fully vested in their employer contributions and the related Plan Trust would be used exclusively for the benefit of participants and beneficiaries after the payment of liquidation expenses.

(13)
Subsequent Events
There have been no subsequent events through the issuance of these financial statements on October 19, 2020.


14



DARDEN SAVINGS PLAN
Schedule H, Line 4a – Schedule of Delinquent Participant Contributions
                    
Year Ended April 30, 2020

Participant Contributions Transferred Late to Plan *
 
Total That Constitute Nonexempt Prohibited Transactions
 
Total Fully Corrected under VFCP and PTE 2002-51
Check here if late participant loan contributions are included: x
Contributions Not Corrected
Contributions Corrected Outside VFCP*
Contributions Pending Correction in VFCP
 
$
1,151,782


1,151,782


 
$



*
This correction was reported last year and is included again since the lost earnings were remitted in the 2019-2020 plan year (specifically on May 24, 2019). The amount above represents late participant contributions and loan repayments that were not timely transferred to the Plan for the 2018-2019 plan year. Darden was ineligible to correct this late contribution error under VFCP because the Plan was under a DOL audit at the time of the correction. Darden self-corrected the error by wiring the late contributions and loan repayments on April 15, 2019 (one business day after the date the wire should have occurred) and subsequently remitting lost earnings of $570.21 on May 24, 2019, which lost earnings were calculated using the DOL's lost earnings calculator. Darden also filed IRS Form 5330 to report the delinquent contributions and paid the related excise tax of $85.75.

See accompanying report of independent registered public accounting firm.


15



DARDEN SAVINGS PLAN
Schedule H, Line 4i – Schedule of Assets (Held at End of Year)
April 30, 2020
 
Issuer
 
Face amount
or number
of units
 
Cost
 
Current
value
Darden Common Stock *
 
2,617,044

 
$
65,731,645

 
$
193,111,677

Columbia Trust Stable Government I-0 Fund
 
4,571,177

 
52,886,669

 
53,528,478

DFA US Small Cap Portfolio Fund
 
1,147,540

 
37,964,799

 
30,708,169

TS&W Collective/International Large Cap Equity Fund
 
3,007,451

 
29,797,730

 
25,054,169

Vanguard Institutional Index Plus Fund
 
445,311

 
131,782,765

 
115,825,435

Vanguard Target Retirement 2060 Fund
 
351,884

 
8,378,562

 
8,191,871

Vanguard Target Retirement 2055 Fund
 
1,101,280

 
25,743,167

 
25,593,746

Vanguard Target Retirement 2050 Fund
 
2,020,444

 
45,507,281

 
46,773,285

Vanguard Target Retirement 2045 Fund
 
2,683,681

 
58,641,310

 
62,019,857

Vanguard Target Retirement 2040 Fund
 
1,670,860

 
37,103,081

 
38,713,819

Vanguard Target Retirement 2035 Fund
 
2,297,057

 
49,099,414

 
53,199,834

Vanguard Target Retirement 2030 Fund
 
1,244,896

 
27,259,931

 
28,806,901

Vanguard Target Retirement 2025 Fund
 
1,621,147

 
34,562,679

 
37,448,491

Vanguard Target Retirement 2020 Fund
 
631,917

 
13,714,909

 
14,458,272

Vanguard Target Retirement 2015 Fund
 
338,414

 
7,131,135

 
7,560,166

Vanguard Institutional Target Retirement Income Fund
 
244,937

 
5,151,951

 
5,422,913

Vanguard Total Bond Market Index Fund
 
2,460,398

 
26,814,258

 
28,319,181

Vanguard Extended Market Index Fund
 
385,559

 
28,226,422

 
30,686,635

Vanguard Total International Stock Index Institutional Fund
 
63,415

 
7,501,915

 
6,178,556

Short-term Investment Fund*
 
4,419,142

 
4,419,142

 
4,419,142

Notes receivable from Participants outstanding – interest rates ranging from 4.25% – 9.50% with varying maturities*
 
4,968

 

 
22,564,910

Total
 


 
 
 
838,585,507

*
Party-in-interest
 
 
See accompanying report of independent registered public accounting firm.


16



EXHIBIT INDEX
 
Exhibit
Number
 
Description of Exhibit
23
 

SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Darden Savings Plan has duly caused this Annual Report to be signed on its behalf by the Benefit Plans Committee (as Plan Fiduciary and administrator of the financial aspects of the Darden Savings Plan), by the undersigned hereunto duly authorized.
 
 
 
 
By:
Benefit Plans Committee,
 
 
 
 
as Plan Fiduciary and administrator
 
 
 
 
of the financial aspects of
 
 
 
 
the Darden Savings Plan
 
 
 
 
Dated:
October 19, 2020
 
By:
/s/ Julie Griffin
 
 
 
 
Julie Griffin, Chairperson
 
 
 
 
Benefit Plans Committee
 
 
 
 
Darden Restaurants, Inc.




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