Delaware | 1-2207 | 38-0471180 |
(State or other jurisdiction of incorporation) | (Commission File Number) | (I.R.S. Employer Identification No.) |
One Dave Thomas Blvd., Dublin, Ohio | 43017 | |
(Address of principal executive offices) | (Zip Code) |
Exhibit No. | Description |
2.1 | Asset Purchase Agreement by and among Wendy’s International, Inc., as seller, SeaWend, Ltd., as purchaser, and Cedar Enterprises, Inc., J. David Karam, Joseph D. Karam and James M. Karam, as guarantors, dated as of October 1, 2013, incorporated herein by reference to Exhibit 2.1 of The Wendy’s Company Current Report on Form 8-K filed on October 7, 2013 (SEC file No. 001-02207). |
99.1 | The unaudited pro forma condensed consolidated balance sheet as of June 30, 2013 and the unaudited pro forma condensed consolidated statements of operations of The Wendy’s Company for the six months ended June 30, 2013 and the year ended December 30, 2012, including notes to the unaudited pro forma condensed consolidated financial statements. |
THE WENDY’S COMPANY | |
(Registrant) | |
Date: October 10, 2013 | By:/s/ Todd A. Penegor |
Todd A. Penegor | |
Senior Vice President and | |
Chief Financial Officer |
Exhibit | Description |
2.1 | Asset Purchase Agreement by and among Wendy’s International, Inc., as seller, SeaWend, Ltd., as purchaser, and Cedar Enterprises, Inc., J. David Karam, Joseph D. Karam and James M. Karam, as guarantors, dated as of October 1, 2013, incorporated herein by reference to Exhibit 2.1 of The Wendy’s Company Current Report on Form 8-K filed on October 7, 2013 (SEC file No. 001-02207). |
99.1 | The unaudited pro forma condensed consolidated balance sheet as of June 30, 2013 and the unaudited pro forma condensed consolidated statements of operations of The Wendy’s Company for the six months ended June 30, 2013 and the year ended December 30, 2012, including notes to the unaudited pro forma condensed consolidated financial statements. |
Historical | Pro Forma Adjustments | Pro Forma | ||||||||||
ASSETS | ||||||||||||
Current assets: | ||||||||||||
Cash and cash equivalents | $ | 489,017 | $ | (36 | ) | (a) | $ | 503,649 | ||||
14,668 | (b) | |||||||||||
Accounts and notes receivable | 65,810 | — | 65,810 | |||||||||
Inventories | 11,715 | (164 | ) | (a) | 11,551 | |||||||
Prepaid expenses and other current assets | 51,468 | — | 51,468 | |||||||||
Deferred income tax benefit | 86,501 | — | 86,501 | |||||||||
Advertising funds restricted assets | 71,284 | — | 71,284 | |||||||||
Total current assets | 775,795 | 14,468 | 790,263 | |||||||||
Properties | 1,226,532 | (4,461 | ) | (a) | 1,221,038 | |||||||
(1,033 | ) | (c) | ||||||||||
Goodwill | 872,883 | (3,438 | ) | (a) | 869,445 | |||||||
Other intangible assets | 1,300,585 | 3,721 | (d) | 1,304,306 | ||||||||
Investments | 107,445 | — | 107,445 | |||||||||
Deferred costs and other assets | 33,455 | — | 33,455 | |||||||||
Total assets | $ | 4,316,695 | $ | 9,257 | $ | 4,325,952 | ||||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||||||
Current liabilities: | ||||||||||||
Current portion of long-term debt | $ | 248,876 | $ | — | $ | 248,876 | ||||||
Accounts payable | 86,646 | — | 86,646 | |||||||||
Accrued expenses and other current liabilities | 128,212 | 345 | (e) | 128,557 | ||||||||
Advertising funds restricted liabilities | 71,284 | — | 71,284 | |||||||||
Total current liabilities | 535,018 | 345 | 535,363 | |||||||||
Long-term debt | 1,222,285 | — | 1,222,285 | |||||||||
Deferred income taxes | 440,364 | 3,436 | (f) | 443,800 | ||||||||
Other liabilities | 155,226 | (297 | ) | (a) | 158,206 | |||||||
3,172 | (d) | |||||||||||
105 | (g) | |||||||||||
Commitments and contingencies | ||||||||||||
The Wendy’s Company stockholders’ equity | 1,966,133 | 2,496 | (h) | 1,968,629 | ||||||||
Noncontrolling interests | (2,331 | ) | — | (2,331 | ) | |||||||
Total liabilities and equity | $ | 4,316,695 | $ | 9,257 | $ | 4,325,952 |
Historical | Pro Forma Adjustments | Pro Forma | ||||||||||
Revenues: | ||||||||||||
Sales | $ | 1,101,871 | $ | (20,216 | ) | (a) | $ | 1,081,655 | ||||
Franchise revenues | 152,355 | 2,497 | (i) | 154,852 | ||||||||
1,254,226 | (17,719 | ) | 1,236,507 | |||||||||
Costs and expenses: | ||||||||||||
Cost of sales | 934,126 | (16,531 | ) | (a) | 916,776 | |||||||
(819 | ) | (j) | ||||||||||
General and administrative | 140,105 | (275 | ) | (a) | 139,830 | |||||||
Depreciation and amortization | 90,516 | (426 | ) | (a) | 90,047 | |||||||
(43 | ) | (c) | ||||||||||
Facilities action charges, net | 9,415 | — | 9,415 | |||||||||
Other operating expense, net | 610 | 819 | (j) | 1,452 | ||||||||
23 | (d) | |||||||||||
1,174,772 | (17,252 | ) | 1,157,520 | |||||||||
Operating profit | 79,454 | (467 | ) | 78,987 | ||||||||
Interest expense | (39,928 | ) | — | (39,928 | ) | |||||||
Loss on early extinguishment of debt | (21,019 | ) | — | (21,019 | ) | |||||||
Investment income and other (expense), net | (2,223 | ) | — | (2,223 | ) | |||||||
Income before income taxes and nonconrolling interests | 16,284 | (467 | ) | 15,817 | ||||||||
Provision for income taxes | (2,149 | ) | 175 | (k) | (1,974 | ) | ||||||
Net income | 14,135 | (292 | ) | 13,843 | ||||||||
Net loss attributable to noncontrolling interests | 222 | — | 222 | |||||||||
Net income attributable to The Wendy’s Company | $ | 14,357 | $ | (292 | ) | $ | 14,065 | |||||
Basic net income per share attributable to The Wendy’s Company | $ | 0.04 | $ | 0.04 | ||||||||
Diluted net income per share attributable to The Wendy’s Company | $ | 0.04 | $ | 0.04 | ||||||||
Weighted average number of basic shares outstanding | 392,836 | 392,836 | ||||||||||
Weighted average number of diluted shares outstanding | 396,789 | 396,789 |
Historical | Pro Forma Adjustments | Pro Forma | ||||||||||
Revenues: | ||||||||||||
Sales | $ | 2,198,323 | $ | (39,439 | ) | (a) | $ | 2,158,884 | ||||
Franchise revenues | 306,919 | 4,899 | (i) | 311,818 | ||||||||
2,505,242 | (34,540 | ) | 2,470,702 | |||||||||
Costs and expenses: | ||||||||||||
Cost of sales | 1,881,248 | (32,123 | ) | (a) | 1,847,479 | |||||||
(1,646 | ) | (j) | ||||||||||
General and administrative | 287,808 | (643 | ) | (a) | 287,165 | |||||||
Depreciation and amortization | 146,976 | (805 | ) | (a) | 146,086 | |||||||
(85 | ) | (c) | ||||||||||
Impairment of long-lived assets | 21,097 | — | 21,097 | |||||||||
Facilities relocation costs and other transactions | 41,031 | — | 41,031 | |||||||||
Other operating expense, net | 4,335 | 1,646 | (j) | 6,018 | ||||||||
37 | (d) | |||||||||||
2,382,495 | (33,619 | ) | 2,348,876 | |||||||||
Operating profit | 122,747 | (921 | ) | 121,826 | ||||||||
Interest expense | (98,604 | ) | — | (98,604 | ) | |||||||
Loss on early extinguishment of debt | (75,076 | ) | — | (75,076 | ) | |||||||
Other income, net and investment income, net | 37,808 | — | 37,808 | |||||||||
Loss before income taxes and noncontrolling interests | (13,125 | ) | (921 | ) | (14,046 | ) | ||||||
Benefit from income taxes | 21,083 | 345 | (k) | 21,428 | ||||||||
Income from continuing operations | 7,958 | (576 | ) | 7,382 | ||||||||
Income attributable to noncontrolling interests | (2,384 | ) | — | (2,384 | ) | |||||||
Income from continuing operations attributable to The Wendy’s Company | $ | 5,574 | $ | (576 | ) | $ | 4,998 | |||||
Basic income from continuing operations per share attributable to The Wendy’s Company | $ | 0.02 | $ | 0.01 | ||||||||
Diluted income from continuing operations per share attributable to The Wendy’s Company | $ | 0.02 | $ | 0.01 | ||||||||
Weighted average number of basic shares outstanding | 390,275 | 390,275 | ||||||||||
Weighted average number of diluted shares outstanding | 392,140 | 392,140 |
(a) | The elimination of assets and liabilities included in the SeaWend Disposition, estimated goodwill allocated to the restaurants being sold and historical revenues and expenses. |
(b) | Reflects anticipated cash proceeds of the $14,040 sale price, $550 of initial franchise fees and $105 of Development Fees, as reduced by $(27) of net liabilities assumed. |
(c) | Reflects the adjustment to fair value for buildings and leasehold improvements included in properties, as a result of the lease and/or sublease of such properties to SeaWend and the related pro forma effect on continuing depreciation and amortization. |
(d) | Reflects favorable lease assets and unfavorable lease liabilities resulting from the lease and/or sublease of land, buildings and/or leasehold improvements to SeaWend and the related pro forma effect on continuing amortization. |
(e) | Reflects the deferral of anticipated cash proceeds for the in process remodeling of one restaurant under our image activation program. |
(f) | Income taxes related to the estimated pre-tax gain on sale, revenue recognized for the initial franchise fees and the adjustment to fair value of assets discussed above. Income taxes are based on the estimated statutory tax rate adjusted for the impact of non-deductible goodwill. |
(g) | Reflects the deferral of anticipated cash proceeds for Development Fees which will be recognized in connection with the future development of Wendy’s restaurants by SeaWend. |
(h) | The after-tax effect on stockholders’ equity attributable to The Wendy’s Company due to the SeaWend Disposition including: (1) $2,798 estimated gain on sale, (2) $344 revenue recognized for the initial franchise fees and (3) $(646) adjustment to fair value of assets. |
(i) | Pro forma franchise royalty revenues and rental income as a result of the SeaWend Disposition. |
(j) | Reclassification of continuing rental expense and net favorable and unfavorable lease amortization from cost of sales to other operating expense, net as a result of the related properties being subleased to SeaWend in connection with the SeaWend Disposition. |
(k) | The income tax effect resulting from the pro forma effect of the SeaWend Disposition based on the estimated statutory tax rate. |