Wendy's 2008 Annual Report Download - page 117

share for 2007 has been computed by dividing the allocated income for the Class A Common Stock and
Class B Common Stock by the weighted average number of shares of each class plus the potential common
share effect on each class of dilutive stock options and of Class B restricted shares, computed using the treasury
stock method, as presented in the table that follows. The shares used to calculate diluted income per share
exclude any effect of the Company’s 5% convertible notes due 2023 (the “Convertible Notes”) which would
have been antidilutive since the after-tax interest on the Convertible Notes per share obtainable on conversion
exceeded the reported basic income from continuing operations per share (see Note 10).
As disclosed in Note 10, during 2006 an aggregate of $172,900 of the Convertible Notes were converted
or effectively converted into 4,323 and 8,645 shares of the Company’s Class A Common Stock and Class B
Common Stock, respectively. The weighted average effect of these shares is included in the basic income or
(loss) per share calculation from the dates of their issuance.
The only Company securities as of December 28, 2008 that could dilute basic income per share for years
subsequent to December 28, 2008 are (1) outstanding stock options which can be exercised into 26,723 shares
of the Company’s Class A Common Stock (see Note 16), (2) 413 restricted shares of the Company’s Class A
Common Stock which principally vest over three years (see Note 16) and (3) $2,100 of Convertible Notes
which are convertible into 160 shares of the Company’s common stock (see Note 10).
Income (loss) per share has been computed by allocating the income or loss as follows:
2008 2007 2006
Class A Common Stock:
Continuing operations................................. $(421,599) $ 4,337 $(3,404)
Discontinued operations ............................... 1,378 286 (41)
Net (loss) income. . . .................................. $(420,221) $ 4,623 $(3,445)
Class B Common Stock:
Continuing operations................................. $ (60,359) $10,749 $(7,399)
Discontinued operations ............................... 839 709 (88)
Net (loss) income. . . .................................. $ (59,520) $11,458 $(7,487)
The number of shares used to calculate basic and diluted (loss) income per share were as follows:
2008 2007 2006
Class A Common Stock:
Basic shares—weighted average shares outstanding. ......... 137,669 28,836 27,301
Dilutive effect of stock options and restricted shares ........ — 129 —
Diluted shares .......................................... 137,669 28,965 27,301
Class B Common Stock:
Basic shares—weighted average shares outstanding 47,965(a) 63,523 59,343
Dilutive effect of stock options and restricted shares ........ — 759 —
Diluted shares .......................................... 47,965 64,282 59,343
(a) Represents the weighted average for the full year even though the Class B Common Stock was converted
into Class A Common Stock on September 29, 2008.
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Wendy’s/Arby’s Group, Inc. and Subsidiaries
(Formerly Triarc Companies, Inc.)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—CONTINUED
(In Thousands Except Per Share Amounts)