Wendy's 2011 Annual Report Download - page 114

THE WENDY’S COMPANY AND SUBSIDIARIES
WENDY’S RESTAURANTS, LLC AND SUBSIDIARIES
COMBINED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—CONTINUED
(In Thousands Except Per Share Amounts)
The following table summarizes the Companies “Transaction related and other costs”:
Severance and stock compensation costs .......................................... $28,680
Employee retention .......................................................... 8,495
Bonus .................................................................... 3,127
Other professional fees ....................................................... 2,090
Relocation (a) .............................................................. 1,670
Other .................................................................... 415
Total Wendy’s Restaurants ................................................ 44,477
Other professional fees ....................................................... 845
Employee retention .......................................................... 159
Other .................................................................... 230
Total The Wendy’s Company ............................................. $45,711
(a) Relocation costs are expensed as incurred. However, payments of $1,500 incurred during the third quarter of
2011 due to the relocation of a corporate executive will be expensed over the three year period following this
executive’s relocation in accordance with the terms of the agreement.
We anticipate that our relocation activities will be substantially completed by the third quarter of 2012.
Wendy’s Restaurants expects to expense costs aggregating approximately $23,000 in 2012 primarily related to
(1) employee severance, retention, recruiting and relocation and (2) the operating lease for the Atlanta restaurant
support center. Wendy’s may also incur redundant compensation costs in 2012 for staff overlap during the relocation
transition.
(18) Merger Restructuring
As a result of the merger with Wendy’s in September 2008, Wendy’s Restaurants and The Wendy’s Company
incurred costs (primarily for employee severance) aggregating $11,189 and $14,197, respectively, related to a
restructuring plan. The plan was completed in 2009. Wendy’s Restaurants and The Wendy’s Company expensed
$8,088 and $11,096, respectively, for such costs in 2009. Payments under this plan were principally made in 2009;
accrued liabilities for these costs as of January 1, 2012 and January 2, 2011 were negligible.
(19) Impairment of Long-Lived Assets
Wendy’s company-owned restaurant impairment losses included in the table below in each year predominantly
reflect impairment charges on restaurant level assets resulting from the deterioration in operating performance of
certain restaurants and additional charges for capital improvements in restaurants impaired in prior years which did
not subsequently recover. Additionally, in 2010 and 2009, Wendy’s impairment losses included write-downs in the
carrying value of certain surplus properties and properties held for sale.
During 2009, The Wendy’s Company disposed of one of its owned aircraft and recorded impairment based on
the sale price.
These impairment losses as detailed in the following table represented the excess of the carrying amount over
the fair value of the affected assets and are included in “Impairment of long-lived assets.”
2011 2010 2009
Impairment of company-owned restaurants:
Properties .............................................. $10,120 $21,201 $21,263
Intangible assets .......................................... 2,763 5,125 2,180
Total Wendy’s Restaurants ............................. 12,883 26,326 23,443
Aircraft .................................................... — — 2,176
Total The Wendy’s Company ........................... $12,883 $26,326 $25,619
110