Wendy's 2009 Annual Report Download - page 131

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Information pertaining to the remaining co-investment is as follows:
280 BT
Ownership percentages at January 3, 2010:
Company..................................................................... 80.1%
Former officers of the Company ................................................ 11.2%
Other........................................................................ 8.7%
Sale of Deerfield capital investments
In connection with the Deerfield Sale, the Company sold its 63.6% capital interest in Deerfield to DFR.
The remaining Deerfield capital interests that were owned directly or indirectly by executives of Deerfield (the
“Deerfield Executives”), including one who was also a former director of the Company (the “Deerfield
Executive”), were also sold to DFR in connection with the Deerfield Sale. All related rights that the Company
had to acquire the capital interests of Deerfield owned by two Deerfield Executives were cancelled at that time.
In addition, the rights of those two executives to require the Company to acquire their economic interests were
also cancelled in connection with the Deerfield Sale (see below for the discussion of the severance agreement
with of one of these executives).
The Deerfield Sale was an event of dissolution of TDH. In connection with its dissolution during
April 2008, $743 was distributed to the minority members of TDH, which included former members of our
management.
In accordance with an employment agreement with a Deerfield Executive who was also a director of the
Company through June 2007, Deerfield incurred expenses in 2007 through the date of the Deerfield Sale of
$170 included in “General and administrative”, to reimburse an entity, of which the executive is the principal
owner, for operating expenses related to the business usage of an airplane.
Immediately prior to the Deerfield Sale, the Company and one of the Deerfield Executives entered into an
agreement whereby such executive agreed to resign as an officer and director of Deerfield upon the completion
of the Deerfield Sale (the “Deerfield Severance Agreement”). In exchange, the Company agreed to a severance
package in 2007 with a cost of approximately $2,600 which is included in “General and administrative.” The
severance package was a continuing liability of Deerfield and, as it was not to be paid by the Company, there is
an offsetting amount included in the gain related to the Deerfield Sale.
In connection with the sale to another Deerfield Executive of an internally developed financial model that
the Company’s former asset management segment chose not to use, in the fourth quarter of 2007, the
Company recorded a gain of $300. During 2007, the Company recognized a $3,025 impairment charge, which
is included in “Impairment of other long-lived assets”, related to the then anticipated loss on the sale of the
model. This former executive also had certain rights which would have required the Company to acquire his
economic interests in Deerfield through July 2008, which were cancelled in connection with the Deerfield Sale.
Other
The Company was being reimbursed by the Former Executives for incremental operating expenses related
to certain personal usage of corporate aircraft through the date of the Contractual Settlements. The
reimbursement for 2007 through July 1, 2007 amounted to $668 and was recognized as a reduction of
“General and administrative.” (See below for discussion of arrangements since that time).
Agreements with the Former Executives
In connection with the Corporate Restructuring, the Company entered into a series of agreements with
the Former Executives and the Management Company formed by the Former Executives and a director, who is
also the former Vice Chairman of the Company (collectively, the “Principals”). Prior to 2007, the Principals
started a series of equity investment funds (the “Equity Funds”) that are separate and distinct from the
124
Wendy’s/Arby’s Group, Inc. and Subsidiaries
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—CONTINUED
(In Thousands Except Per Share Amounts)