Wendy's 2008 Annual Report Download - page 36

against disenfranchising the purported class and consummating the merger; a declaration that the defendants
breached their fiduciary duties; costs and attorneys fees; and any other relief the court deems proper and just.
Also on April 25, 2008, a putative class action and derivative complaint was filed by Cindy Henzel, on
behalf of herself and others similarly situated, and derivatively on behalf of Wendy’s, against Wendy’s and its
directors in the Franklin County, Ohio Court of Common Pleas. A motion for leave to file an amended
complaint was filed on June 16, 2008. The proposed amended complaint alleges breach of fiduciary duties
arising out of the Wendy’s board of directors’ search for a merger partner and out of its approval of the merger
agreement on April 23, 2008, and failure to disclose material information related to the merger in the Form
S-4. The proposed amended complaint seeks certification of the proceeding as a derivative and class action; an
injunction against consummating the merger and requiring the defendants to promptly hold an annual
meeting and to seek another merger partner; rescission of any part of the merger agreement already
implemented; a declaration that the defendants breached their fiduciary duties; costs and attorneys fees; and
any other relief the court deems proper and just.
On May 22, 2008, a putative class action complaint was filed by Ronald Donald Smith, on behalf of
himself and others similarly situated, against Wendy’s and its directors in the Franklin County, Ohio Court of
Common Pleas. A motion for leave to file an amended complaint was filed on June 30, 2008. The proposed
amended complaint alleged breach of fiduciary duties arising out of the Wendy’s board of directors’ search for a
merger partner and out of its approval of the merger agreement on April 23, 2008, and failure to disclose
material information related to the merger in the Form S-4. The proposed amended complaint sought
certification of the proceeding as a derivative and class action; an injunction against consummating the merger
and requiring the defendants to promptly hold an annual meeting and to seek another merger partner;
rescission of any part of the merger agreement already implemented; a declaration that the defendants breached
their fiduciary duties; costs and attorneys fees; and any other relief the court deems proper and just.
On June 13, 2008, a putative class action complaint was filed by Peter D. Ravanis and Dorothea Ravanis,
on behalf of themselves and others similarly situated, against Wendy’s, its directors, and Triarc Companies,
Inc. in the Supreme Court of the State of New York, New York County. An amended complaint was filed on
June 20, 2008. The amended complaint alleges breach of fiduciary duties arising out of the Wendy’s board of
directors’ search for a merger partner and out of its approval of the merger agreement on April 23, 2008, and
failure to disclose material information related to the merger in the Form S-4. The amended complaint seeks
certification of the proceeding as a class action; preliminary and permanent injunctions against consummating
the merger; other equitable relief; attorneys’ fees; and any other relief the court deems proper and just. All
parties to this case have jointly requested that the court stay the action pending resolution of the Ohio cases.
On July 9, 2008, the parties to the three Ohio actions described above filed a stipulation and proposed
order that would consolidate the cases, provide for the proposed amended complaint in the Henzel case to be
the operative complaint in each of the cases, designate one law firm as lead plaintiffs’ counsel, and establish an
answer date for the defendants in the consolidated case. The court entered the order as proposed in all three
cases on July 9, 2008.
On August 13, 2008, counsel for the parties to the Guiseppone, Henzel, Smith and Ravanis cases
described above entered into a memorandum of understanding in which they agreed upon the terms of a
settlement of all such lawsuits, which would include the dismissal with prejudice, and release, of all claims
against all the defendants, including Wendy’s, its directors, us and Trian Partners. In connection with the
settlement, Wendy’s agreed to make certain additional disclosures to its shareholders, which were contained in
the Form S-4 and to pay plaintiffs’ legal fees.
On January 30, 2009, the parties entered into a Class and Derivative Action Stipulation of Settlement.
The settlement is subject to approval by the Common Pleas Court of Franklin County, Ohio. On January 30,
2009, the plaintiffs submitted an application for an order preliminarily approving the settlement, certifying a
class for settlement purposes only, providing for notice to the class and setting a final settlement hearing. The
court has not yet ruled on that application. Although we expect the court to approve the settlement, there can
be no assurance that the court will do so. If the court withholds approval, the proposed settlement may be
terminated.
The defendants believe that the Guiseppone, Henzel, Smith and Ravanis cases described above are without
merit and intend to vigorously defend them in the event that court approval is not obtained. While we do not
believe that these actions will have a material adverse effect on our financial condition or results of operations,
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