Wendy's 2008 Annual Report Download - page 11

Wendy’s/Arby’s Class A common stock (the “Class A Common Stock”) for each Wendy’s common share
owned.
In the Wendy’s Merger, approximately 377,000,000 shares of Wendy’s/Arby’s common stock were issued
to Wendy’s shareholders. The merger value of approximately $2.5 billion for financial reporting purposes is
based on the 4.25 conversion factor of the Wendy’s outstanding shares as well as previously issued restricted
stock awards both at a value of $6.57 per share which represents the average closing market price of Triarc
Class A Common Stock two days before and after the merger announcement date of April 24, 2008. Wendy’s
shareholders held approximately 80%, in the aggregate, of Wendy’s/Arby’s outstanding common stock
immediately following the Wendy’s Merger. In addition, effective on the date of the Wendy’s Merger, our
Class B common stock (the “Class B Common Stock”) was converted into Class A Common Stock.
The Wendy’s and Arby’s brands continue to operate independently, with headquarters in Dublin, Ohio
and Atlanta, Georgia, respectively. A consolidated support center is based in Atlanta, Georgia and oversees all
public company responsibilities, as well as other shared service functions.
Business Strategy
Our business strategy is focused on growing same-store sales, restaurant margins and operating income at
the Wendy’s and Arby’s brands with improved marketing, menu development, restaurant operations and
customer service. We are also focused on effectively managing the integration of our brands and building a
shared services organization to achieve significant synergies and efficiencies. Our goal is to produce
consolidated revenue and operating income growth with attractive return on investment, resulting in increased
shareholder value. We will also continue to evaluate various acquisitions and business combinations in the
restaurant industry, which may result in increases in expenditures and related financing activities. See “Item 7.
Management’s Discussion and Analysis of Financial Condition and Results of Operations.” Unless
circumstances dictate otherwise, it is our policy to publicly announce an acquisition or business combination
only after a definitive agreement with respect to such acquisition or business combination has been reached.
On November 1, 2005, Nelson Peltz, our Chairman and former Chief Executive Officer, Peter W. May,
our Vice Chairman and former President and Chief Operating Officer, and Edward P. Garden, our Former Vice
Chairman and a member of our Board of Directors (collectively, the “Principals”), started a series of equity
investment funds (the “Funds”) that are separate and distinct from the Company and that are being managed
by the Principals and certain other former senior officers and former employees of the Company through a
management company (the “Management Company”) formed by the Principals. The investment strategy of the
Funds is to achieve capital appreciation by investing in equity securities of publicly traded companies and
effecting positive change in those companies through active influence and involvement. Before agreeing to
acquire more than 50% of the outstanding voting securities of a company in the quick service restaurant
industry, the Principals have agreed to offer us such acquisition opportunity, which may result in acquisition
opportunities being made available to us from time to time. See Note 27 to the Consolidated Financial
Statements for additional information on our agreements with the Management Company.
Fiscal Year
We use a 52/53 week fiscal year convention whereby our fiscal year ends each year on the Sunday that is
closest to December 31 of that year. Wendy’s used the same fiscal periods for all periods presented in this Form
10-K. Each fiscal year generally is comprised of four 13-week fiscal quarters, although in the years with
53 weeks, including 2009, the fourth quarter represents a 14-week period.
Business Segments
We operate in two business segments, Wendy’s and Arby’s. See Note 30 of the Financial Statements and
Supplementary Data included in Item 8 herein, for financial information attributable to our business segments.
The Wendy’s Restaurant System
Wendy’s was incorporated in 1969 under the laws of the State of Ohio. Wendy’s and its subsidiaries are
collectively referred to herein as “Wendy’s.” Wendy’s is the 3rd largest restaurant franchising system
specializing in the hamburger sandwich segment of the quick service restaurant industry. According to Nation’s
Restaurant News, Wendy’s is the 4th largest quick service restaurant chain in the United States.
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