Wendy's 2009 Annual Report Download - page 101

Download and view the complete annual report

Please find page 101 of the 2009 Wendy's annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 166

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120
  • 121
  • 122
  • 123
  • 124
  • 125
  • 126
  • 127
  • 128
  • 129
  • 130
  • 131
  • 132
  • 133
  • 134
  • 135
  • 136
  • 137
  • 138
  • 139
  • 140
  • 141
  • 142
  • 143
  • 144
  • 145
  • 146
  • 147
  • 148
  • 149
  • 150
  • 151
  • 152
  • 153
  • 154
  • 155
  • 156
  • 157
  • 158
  • 159
  • 160
  • 161
  • 162
  • 163
  • 164
  • 165
  • 166

were liquidated in June 2009 for $37,401 (the “Equities Sale”), of which $31,901 was received by us, net of
the Withdrawal Fee and for which we realized a gain of $2,280 in 2009, which are both included in
“Investment (expense) income, net.”
Liquidation Services Agreement
On June 10, 2009, Wendy’s/Arby’s and the Management Company entered into a liquidation services
agreement (the “Liquidation Services Agreement”) whereby, the Management Company will assist us in the
sale, liquidation or other disposition of our cost investments and DFR Notes, (the “Legacy Assets”), which are
not related to the Equities Account. As of the date of the Liquidation Services Agreement, the Legacy Assets
were valued at $36,600 (the “Target Amount”). The Liquidation Services Agreement, which expires June 30,
2011, provided for the payment of a fee of $900 in two installments to the Management Company which is
being recognized as expense over the term of the agreement and included in “General and administrative.” In
addition, in the event that any or all of the Legacy Assets are sold, liquidated or otherwise disposed of and the
aggregate net proceeds to us are in excess of the Target Amount, we will pay the Management Company a
success fee equal to 10% of the aggregate net proceeds in excess of the Target Amount.
DFR Investments
Prior to the Deerfield Sale, the Company had been accounting for its vested DFR common stock under
the Equity Method due to the Company’s significant influence over the operational and financial policies of
DFR, principally reflecting the Company’s representation on DFR’s board of directors and the management of
DFR by the Company. The Company received $4,171 of distributions with respect to its aggregate investment
in DFR during 2007 which, in accordance with the Equity Method, reduced the carrying value of this
investment.
Presented below is summary financial information of DFR as of and for the year ended December 31,
2007, DFR’s year end. As we held our equity investment in DFR for less than one quarter in 2008, we have
not presented any data for that year. The company’s actual ownership in DFR Common Stock was 0.3% in
2007. The summary financial information is taken from balance sheets which do not distinguish between
current and long-term assets and liabilities and is as follows:
Year End
2007
Balance sheet information:
Cash and cash equivalents................................................ $ 113,733
Investments in securities................................................. 6,342,477
Other investments ...................................................... 738,404
Other assets ............................................................ 593,355
$7,787,969
Accounts payable and accrued liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 66,028
Securities sold under agreements to repurchase . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,303,865
Long-term debt......................................................... 775,368
Other liabilities......................................................... 1,057,972
Convertible preferred stock............................................... 116,162
Stockholders’ equity..................................................... 468,574
$7,787,969
94
Wendy’s/Arby’s Group, Inc. and Subsidiaries
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—CONTINUED
(In Thousands Except Per Share Amounts)