Wendy's 2011 Annual Report Download - page 39

Sublease of New York Office Space
In July 2008 and July 2007, The Wendy’s Company entered into agreements under which the Management
Company is subleasing (the “Subleases”) office space on two of the floors of the Company’s former New York
headquarters. During the second quarter of 2010, The Wendy’s Company and the Management Company entered
into an amendment to the sublease, effective April 1, 2010, pursuant to which the Management Company’s early
termination right was canceled in exchange for a reduction in rent. Under the terms of the amended sublease, which
expires in May 2012, the sublease is not cancelable prior to the expiration of the prime lease in May 2012 and the
Management Company pays rent to The Wendy’s Company in an amount that covers substantially all of the
Company’s rent obligations under the prime lease for the subleased space.
Services Agreements
The Wendy’s Company and the Management Company entered into a new services agreement (the “New
Services Agreement”), which commenced on July 1, 2009 and expired on June 30, 2011. Under the New Services
Agreement, the Management Company assisted us with strategic merger and acquisition consultation, corporate
finance and investment banking services and related legal matters. The Companies paid approximately $2.5 million
and $5.4 million in 2010 and 2009, respectively, in fees for corporate finance advisory services under the New Service
Agreement in connection with the negotiation and execution of the Credit Agreement in 2010 and the issuance of the
Wendy’s Restaurants $565.0 million Senior Notes (the “Senior Notes”) in 2009.
In addition, The Wendy’s Company paid the Management Company a service fee of $0.25 million per quarter,
in connection with the New Services Agreement which expired on June 30, 2011.
Under a prior services agreement, which commenced on June 30, 2007 and expired on June 30, 2009 (the
“Services Agreement”), the Management Company provided a broader range of professional and strategic services to
The Wendy’s Company.
Liquidation Services Agreement
On June 10, 2009, The Wendy’s Company and the Management Company entered into a liquidation services
agreement (the “Liquidation Services Agreement”) pursuant to which the Management Company assisted us in the
sale, liquidation or other disposition of our cost investments and the series A senior notes that we received from
Deerfield Capital Corp. (the “DFR Notes”) (together, the “Legacy Assets”), which were not related to the Equities
Account. The Liquidation Services Agreement required The Wendy’s Company to pay the Management Company a
fee of $0.9 million in two installments in June 2009 and 2010, which was deferred and amortized through its
June 30, 2011 expiration date.
Aircraft Agreement
In August 2007, The Wendy’s Company entered into time share agreements under which the Chairman and
then Chief Executive Officer and the Vice Chairman and then President and Chief Operating Officer of The
Wendy’s Company (the “Former Executives”) and the Management Company used two of The Wendy’s Company’s
corporate aircraft in exchange for payment of certain incremental flight and related costs of such aircraft. Those time
share agreements expired during the second quarter of 2009 and, in the third quarter of 2009, one of the aircraft was
sold to an unrelated third party.
In June 2009, The Wendy’s Company and TASCO, LLC (an affiliate of the Management Company)
(“TASCO”) entered into an aircraft lease agreement (the “Aircraft Lease Agreement”) for the other aircraft that was
previously under the time share agreement mentioned above. The Aircraft Lease Agreement originally provided that
The Wendy’s Company would lease such corporate aircraft to TASCO from July 1, 2009 until June 30, 2010. On
June 24, 2010, The Wendy’s Company and TASCO renewed the Aircraft Lease Agreement for an additional one year
period (expiring on June 30, 2011). Under the Aircraft Lease Agreement, TASCO paid $10 thousand per month for
such aircraft plus substantially all operating costs of the aircraft including all costs of fuel, inspection, servicing and
certain storage, as well as operational and flight crew costs relating to the operation of the aircraft, and all transit
maintenance costs and other maintenance costs required as a result of TASCO’s usage of the aircraft. The Wendy’s
Company continued to be responsible for calendar-based maintenance and any extraordinary and unscheduled repairs
and/or maintenance for the aircraft, as well as insurance and other costs.
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