The following is a summary of transactions between the Company and its related parties:



	Year Ended
	2018			2017			2016
Transactions with QSCC:
Wendy’s Co-Op (a)	$	(470	)	$	(987	)	$	(890	)
Lease income (b)	(215		)	(217		)	(193		)
TimWen lease and management fee payments (c)	$	13,044		$	12,360		$	11,602

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Transactions with QSCC

(a)

Wendy’s has a purchasing co-op relationship agreement (the “Wendy’s Co-op”) with its franchisees which establishes Quality Supply Chain Co-op, Inc. (“QSCC”). QSCC manages, for the Wendy’s system in the U.S. and Canada, contracts for the purchase and distribution of food, proprietary paper, operating supplies and equipment under national agreements with pricing based upon total system volume. QSCC’s supply chain management facilitates continuity of supply and provides consolidated purchasing efficiencies while monitoring and seeking to minimize possible obsolete inventory throughout the Wendy’s supply chain in the U.S. and Canada.

Wendy’s and its franchisees pay sourcing fees to third-party vendors on certain products sourced by QSCC. Such sourcing fees are remitted by these vendors to QSCC and are the primary means of funding QSCC’s operations. Should QSCC’s sourcing fees exceed its expected needs, QSCC’s board of directors may return some or all of the excess to its members in the form of a patronage dividend. Wendy’s recorded its share of patronage dividends of $470, $987 and $890 in 2018, 2017 and 2016, respectively, which are included as a reduction of “Cost of sales.”

(b)

Effective January 1, 2011, Wendy’s leased 14,333 square feet of office space to QSCC for an annual base rental of $176. The lease expired on December 31, 2016. A new lease agreement was signed effective January 1, 2017, expiring on December 31, 2020 for an annual base rental of $215. On November 27, 2018, the lease agreement was amended to increase the leased square footage to 14,493 and increase the annual base rental to $217. The Wendy’s Company received $215, $217 and $193 of lease income from QSCC during 2018, 2017 and 2016, respectively, which has been recorded to “Franchise rental income.”

TimWen lease and management fee payments

(c)

A wholly-owned subsidiary of Wendy’s leases restaurant facilities from TimWen for the operation of Wendy’s/Tim Hortons combo units in Canada. Wendy’s paid TimWen $13,256, $12,572 and $11,806 under these lease agreements during 2018, 2017 and 2016, respectively. In addition, TimWen paid Wendy’s a management fee under the TimWen joint venture agreement of $212, $212 and $204 during 2018, 2017 and 2016, respectively, which has been included as a reduction to “General and administrative.”