<PAGE> 1
SCHEDULE 14A
(RULE 14A)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES
EXCHANGE ACT OF 1934
(AMENDMENT NO. )
Filed by the Registrant /X/
Filed by a Party other than the Registrant / /
Check the appropriate box:
<TABLE>
<S> <C>
/X/ Preliminary Proxy Statement / / CONFIDENTIAL, FOR USE OF THE
COMMISSION ONLY (AS PERMITTED BY RULE
14A-6(E)(2))
/ / Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to sec.240.14a-11(c) or sec.240.14a-12
</TABLE>
WENDY'S INTERNATIONAL, INC.
(NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
LAWRENCE E. SCHAUF, SENIOR VICE PRESIDENT, GENERAL COUNSEL AND SECRETARY
(NAME OF PERSON(S) FILING PROXY STATEMENT, IF OTHER THAN THE REGISTRANT)
Payment of Filing Fee (Check the appropriate box):
/X/ $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), 14a-6(i)(2) or
Item 22(a)(2) of Schedule 14A.
/ / $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
Not Applicable
(2) Aggregate number of securities to which transaction applies:
Not Applicable
(3) Per unit price or other underlying value of transaction computed pursuant to
Exchange Act Rule 0-11 (Set forth the amount on which the filing fee is
calculated and state how it was determined):
Not Applicable
(4) Proposed maximum aggregate value of transaction:
Not Applicable
(5) Total fee paid:
Not Applicable
/ / Fee paid previously with preliminary materials.
/ / Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number, or
the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
Not Applicable
(2) Form, Schedule or Registration Statement No.:
Not Applicable
(3) Filing Party:
Not Applicable
(4) Date Filed:
Not Applicable
<PAGE> 2
- --------------------------------------------------------------------------------
PROXY STATEMENT
WENDY'S
INTERNATIONAL,
INC.
[LOGO]
<PAGE> 3
<TABLE>
<S> <C>
CONTENTS
Notice of Annual Meeting of Shareholders
1 Proxy Statement
1 Voting Securities and Principal Holders Thereof
3 Election of Directors
5 Committees of Directors
7 Compensation of Management
7 Summary Compensation Table
8 Options Granted in Last Fiscal Year
9 Aggregated Option Exercises in Last Fiscal Year and Fiscal Year-End Option Values
10 Report of the Compensation Committee on Executive Compensation
16 Comparison of Five-Year Total Return For Wendy's International, Inc.,
the Restaurants Index and the S&P 500 Index
17 Executive Agreements
20 Certain Transactions Involving Management
22 Approval of Amendment to the Company's Regulations
22 Selection of Independent Public Accountants
23 Other Matters
Map to Wendy's Annual Meeting
</TABLE>
<PAGE> 4
WENDY'S INTERNATIONAL, INC.
P.O. Box 256
Dublin, Ohio 43017-0256
- --------------------------------------------------------------------------------
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
To the Shareholders of Wendy's International, Inc.:
Notice is hereby given that the Annual Meeting of Shareholders of Wendy's
International, Inc. (the "Company") will be held at the Fawcett Center for
Tomorrow, The Ohio State University, 2400 Olentangy River Road, Columbus, Ohio
43210, on Tuesday, April 30, 1996, at 10:00 a.m., local time, for the following
purposes, all of which are more completely set forth in the accompanying Proxy
Statement:
1. To elect five Directors, each for a term of three years.
2. To approve an amendment to the Company's Regulations which would
increase the number of directors to 15 from 13.
3. To ratify the selection of Coopers & Lybrand L.L.P. as the independent
public accountants of the Company for the current year.
4. To transact such other business as may properly come before the meeting.
Only shareholders of record at the close of business on March 4, 1996 are
entitled to notice of and to vote at the Annual Meeting of Shareholders.
- --------------------------------------------------------------------------------
YOUR VOTE IS IMPORTANT
You are urged to date, sign and promptly return the enclosed Proxy so that your
shares may be voted in accordance with your wishes and so that the presence of a
quorum may be assured. The prompt return of your signed Proxy, regardless of the
number of shares you hold, will aid the Company in reducing the expense of
additional Proxy solicitation. The giving of such Proxy does not affect your
right to vote in person in the event you attend the meeting. You are cordially
invited to attend the meeting, and we request that you indicate your plans in
this respect in the space provided on the enclosed form of Proxy.
/s/ Lawrence E. Schauf
----------------------------
LAWRENCE E. SCHAUF
Secretary
Dublin, Ohio
March 6, 1996
<PAGE> 5
WENDY'S INTERNATIONAL, INC.
P.O. Box 256
Dublin, Ohio 43017-0256
(614) 764-3100
- --------------------------------------------------------------------------------
PROXY STATEMENT
The enclosed Proxy, for use at the Annual Meeting of Shareholders to be held on
Tuesday, April 30, 1996, and any adjournments thereof, is being solicited on
behalf of the Board of Directors of the Company. Without affecting any vote
previously taken, the Proxy may be revoked by the shareholder by giving notice
of revocation to the Company in writing or in open meeting. Unless otherwise
specified, all properly executed Proxies received by the Board of Directors will
be voted "FOR" the election as Directors of the nominees listed below under
"ELECTION OF DIRECTORS", "FOR" the approval of the amendment to the Company's
Regulations and "FOR" the ratification of the selection of independent public
accountants.
Solicitation of Proxies may be made by mail, personal interview, telephone and
telegraph by Officers, Directors and regular employees of the Company. In
addition, the Company has retained, at an estimated cost of $10,000 plus
reasonable outside expenses, Georgeson & Co., a firm specializing in proxy
solicitation. All costs of solicitation will be borne by the Company. This Proxy
Statement, including the Notice of Meeting, was first mailed to shareholders on
March 13, 1996.
- --------------------------------------------------------------------------------
VOTING SECURITIES AND PRINCIPAL HOLDERS THEREOF
VOTING RIGHTS
The total number of outstanding shares entitled to vote at the meeting is
and only shareholders of record at the close of business on March 4,
1996, are entitled to notice of and to vote at said meeting or any adjournments
thereof. Each shareholder is entitled to one vote for each share held and has
cumulative voting rights in the election of Directors. A shareholder wishing to
exercise cumulative voting must so notify the President, a Vice President or the
Secretary of the Company in writing not less than 48 hours before the meeting.
If cumulative voting is requested and if an announcement of such request is made
upon the convening of the meeting by the Chairman or Secretary or by or on
behalf of the shareholder requesting cumulative voting, each shareholder will
have a number of votes equal to the number of Directors to be elected multiplied
by the number of shares owned by such shareholder and will be entitled to
distribute his votes among the nominees as the shareholder sees fit. If
cumulative voting is requested, as described above, the enclosed Proxy would
grant discretionary authority to the Proxies named therein to cumulate votes and
to distribute the votes among the candidates.
1
<PAGE> 6
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
The following table sets forth certain information (based upon filings with the
Securities and Exchange Commission) with respect to the persons known to the
Company to own beneficially more than five percent of the outstanding common
shares of the Company as of March 4, 1996:
<TABLE>
<CAPTION>
(3) AMOUNT AND
NATURE OF
(1) TITLE OF (2) NAME AND ADDRESS OF BENEFICIAL (4) PERCENT OF
CLASS BENEFICIAL OWNER OWNERSHIP CLASS
- -------------- ------------------------------- ----------------- -----------------
<S> <C> <C> <C>
Common shares Ronald V. Joyce 16,450,000 13.7%
10 Blue Ridge Mountain Estates
Calgary, Alberta T2M 4N4
Canada
Common shares R. David Thomas 6,076,060(a) 5.0%
P.O. Box 256
Dublin, Ohio 43017
Common shares Travelers Group Inc.(b) 6,580,789(c) 5.5%
388 Greenwich Street
New York, New York 10013
</TABLE>
- ---------
(a) Includes common shares in which Mr. Thomas has shared voting and investment
power.
(b) The shares are held by one or more subsidiaries of Travelers Group Inc.
Travelers Group Inc. and one of such subsidiaries disclaim any beneficial
interest in such shares.
(c) The reporting persons have shared voting and investment power with regard to
all of these shares. The number of shares shown assumes conversion of
certain securities held.
SECURITY OWNERSHIP OF MANAGEMENT
The following table sets forth as of March 4, 1996, certain information with
respect to the Company's common shares owned beneficially by each Director, by
each nominee for election as a Director of the Company, the Executive Officers
named in the Summary Compensation Table set forth on page 7 of this Proxy
Statement and by all Directors and Executive Officers as a group:
AMOUNT AND NATURE OF BENEFICIAL OWNERSHIP
<TABLE>
<CAPTION>
(3) AMOUNT AND
NATURE OF
(2) NAME OF BENEFICIAL BENEFICIAL (4) PERCENT OF
(1) TITLE OF CLASS OWNER OWNERSHIP (A)(B) CLASS
- --------------------- ------------------------- ----------------- -----------------
<S> <C> <C> <C>
(All of these are R. David Thomas 6,076,060 5.0%
common shares.) James W. Near 1,584,931 1.3%
Gordon F. Teter 225,190 .2%
John K. Casey 114,489 --
Ronald E. Musick 222,884 .2%
W. Clay Hamner 2,602 --
Ernest S. Hayeck 775 --
Janet Hill 1,475 --
Thomas F. Keller 1,851 --
Fielden B. Nutter, Sr. 41,479 --
James V. Pickett 49,495 --
Frederick R. Reed 500 --
Thekla R. Shackelford 13,923 --
Charles W. Rath 2,000 --
All Directors and 8,910,739 7.4%
Executive Officers as a
group (26 persons)
</TABLE>
2
<PAGE> 7
- ---------
(a) The amounts reflected in this table include common shares in which there is
shared voting and investment power.
(b) Includes options exercisable within 60 days following March 4, 1996.
The information with respect to beneficial ownership is based upon information
furnished by each Director, nominee or Executive Officer, or information
contained in filings made with the Securities and Exchange Commission.
Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
directors and Executive Officers to file reports of ownership and changes of
ownership with the Securities and Exchange Commission and the New York Stock
Exchange. The Company assists its Directors and Executive Officers in completing
and filing those reports. The Company believes that during the last completed
fiscal year all filing requirements applicable to its Directors and Executive
Officers were complied with except that one report, disclosing one transaction,
was filed late by the Company on behalf of Mr. Reed. In addition, one report,
disclosing one transaction which occurred in 1983, was filed late by the Company
on behalf of Mr. Pickett. Each late filing was due to inadvertent delays by the
Company in furnishing the necessary reports or other assistance to the
individual.
- --------------------------------------------------------------------------------
ELECTION OF DIRECTORS
The Board of Directors has designated the following nominees for election as
Directors of the Company with their terms to expire in 1999:
<TABLE>
<CAPTION>
DIRECTORS AND THEIR DIRECTOR
PRINCIPAL OCCUPATIONS AGE SINCE
- --------------------------------------------------------- --- --------
<S> <C> <C>
Thekla R. Shackelford (1)................................ 61 1984
Owner, School Selection Consulting Columbus, Ohio
Ronald E. Musick (2)..................................... 55 1987(3)
Executive Vice President
W. Clay Hamner (1)(2).................................... 50 1987
Chairman and Chief Executive Officer,
Montrose Capital Corporation;
Chairman, The Pantry, Inc.,
Durham, North Carolina
Gordon F. Teter (2)...................................... 52 1990
President, Chief Executive Officer and Chief Operating
Officer
Frederick R. Reed........................................ 47 1995
Partner, Vorys, Sater, Seymour and Pease
Cincinnati, Ohio
The following Directors will continue to serve after the 1996 Annual Meeting:
TERMS EXPIRING IN 1997
- ----------------------
Fielden B. Nutter, Sr. (2)............................... 71 1980
President, F.B. Nutter Leasing Co.
Pompano Beach, Florida;
Chairman and Chief Executive Officer,
John Henry Rock Drills, Inc.
Belle, West Virginia
</TABLE>
3
<PAGE> 8
<TABLE>
<CAPTION>
DIRECTOR
AGE SINCE
--- --------
<S> <C> <C>
James W. Near (2)........................................ 57 1981
Chairman of the Board
James V. Pickett (1)(2).................................. 54 1982
Chairman, The Pickett Companies;
Managing Director of the real estate investment
group of Banc One Capital Corporation
Dublin, Ohio
Thomas F. Keller (1)..................................... 64 1991
Dean and R.J. Reynolds Professor
of Business Administration,
Fuqua School of Business,
Duke University
Durham, North Carolina
TERMS EXPIRING IN 1998
- ----------------------
R. David Thomas (1)...................................... 63 1969
Senior Chairman of the Board and Founder
John K. Casey (2)........................................ 63 1988
Vice Chairman and Chief Financial Officer
Ernest S. Hayeck (2)..................................... 71 1993
Retired Judge
Trial Court of Massachusetts
Janet Hill (1)(2)........................................ 48 1994
Vice President, Alexander and Associates, Incorporated
Washington, D.C.
</TABLE>
- ---------
(1) Mrs. Shackelford serves as a director of Banc One Corporation and FIserv,
Inc.; Mr. Hamner serves as a director of Fuqua Enterprises, Inc. and
Interstate/Johnson Lane, Inc.; Mr. Pickett serves as a director of Metatec
Corporation; Mr. Keller serves as a director of Ladd Furniture Company,
Hatteras Income Securities, Inc., Nations Funds, Inc., Nations Fund Trust,
Nations Government Income Term Trust 2003, Inc., Nations Government Income
Term Trust 2004, Inc., Nations Balanced Target Maturity Fund Inc., Mentor
Funds Trust, DIMON International, and American Business Products; Mr. Thomas
serves as a director of Clinton Gas Systems, Inc.; and Mrs. Hill serves as a
director of The Progressive Corporation.
(2) Mr. Musick was Vice President, Secretary and Treasurer of Sisters
International, Inc. from March 27, 1981 to October 12, 1982. He was Senior
Vice President, Secretary and Treasurer of Sisters International, Inc. from
October 12, 1982 to March 31, 1987. Mr. Musick was Senior Vice President of
the Company from October 28, 1986 to August 1, 1991, at which time he
assumed his current position.
Montrose Capital Corporation is a private investment company. Mr. Hamner
became Chairman of The Pantry, Inc. on July 11, 1994. The Pantry, Inc. is a
convenience store chain.
Mr. Teter was President of Casa Lupita Restaurants and Executive Vice
President of its parent company, Ponderosa, Inc., from 1985 to May, 1987.
Mr. Teter became a Senior Vice President of the Company in September, 1987,
and Executive Vice President in February, 1988. He became President and
Chief Operating Officer on February 18, 1991. He added the title of Chief
Executive Officer on January 1, 1995.
Mr. Nutter became President of F.B. Nutter Leasing Co. in 1981. He was
President of Pinnacle Industries, Inc. from October, 1986 until that company
finished development of a coal mining facility in 1991. He was Chairman and
Chief Executive Officer of Kare Electronics, Inc. from December, 1988 until
June 1, 1993, when that company was dissolved. Mr. Nutter has been
4
<PAGE> 9
Chairman and Chief Executive Officer of Dickirson Drills, Inc. since April,
1992. He assumed his current position with John Henry Rock Drills, Inc. on
September 1, 1993. F.B. Nutter Leasing Co. is a real estate leasing and
management company. Kare Electronics, Inc. distributed electronic monitoring
devices. Dickirson Drills, Inc. manufactures rotary blast hole drills. John
Henry Rock Drills, Inc. manufactures hydraulic rock drills.
Mr. Near was President and Chief Operating Officer of Sisters
International, Inc. from 1981 until August 12, 1986, when he assumed the
position of President and Chief Operating Officer of the Company. He was
Chief Executive Officer from February 21, 1989 until January 1, 1995. Mr.
Near became Chairman of the Board on February 18, 1991.
Mr. Pickett has served as President and Chief Executive Officer of various
companies generally known as The Pickett Companies since 1969. The Pickett
Companies are involved in real estate development, ownership and management.
Due to declining economic conditions, certain of the companies which
comprise The Pickett Companies filed a petition under Chapter 11 of the
United States Bankruptcy Code on February 1, 1991. A consolidated plan of
reorganization was filed on December 30, 1991 and approved by the bankruptcy
court on April 19, 1992. Mr. Pickett became the Managing Director of the
real estate investment group of Banc One Capital Corporation on February 1,
1993.
Mr. Casey was Senior Vice President of the Company from February 20, 1984
to April 30, 1987, at which time he became Executive Vice President. Mr.
Casey became Executive Vice President -- Finance and Administration, on
December 23, 1987. He assumed his current position on February 18, 1991.
Judge Hayeck was a Trial Court Justice for the State of Massachusetts, from
January 27, 1970 until he retired on January 26, 1993. Judge Hayeck was
awarded the American Bar Association Franklin N. Flaschner Judicial Award in
1992. He is also a faculty member of the National Judicial College. He
became a Director of the Company on February 8, 1993.
Mrs. Hill provides corporate planning, advice and analysis to directors,
executives and managers in the areas of human resource planning, corporate
responsibility, corporate communications and government consultation.
Alexander & Associates, Incorporated is a corporate consulting firm.
Each of the other Directors has had the same principal occupation and
employer during the past five years as set forth in this table.
(3) Mr. Musick was a Director of the Company from 1970 to 1981.
Unless otherwise directed, the persons named in the Proxy will vote the Proxies
for the election of Mrs. Shackelford and Messrs. Musick, Hamner, Teter and Reed
as Directors of the Company, each to serve for a term of three years and until
their successors are elected and qualified. While it is contemplated that all
nominees will stand for election, in the event any person nominated fails to
stand for election, the Proxies will be voted for such other person or persons
as may be designated by the Directors. Management has no reason to believe that
any of the above-mentioned persons will not stand for election or serve as a
Director.
Under Ohio law and the Company's Code of Regulations, the five nominees
receiving the greatest number of votes will be elected as Directors. Shares as
to which the authority to vote is withheld and broker non-votes are not counted
toward the election of Directors or toward the election of the individual
nominees specified on the Proxy.
- --------------------------------------------------------------------------------
COMMITTEES OF DIRECTORS
A total of eight meetings of the Board of Directors of the Company were held
during 1995. No Director attended less than 75 percent of the aggregate of (1)
the total number of meetings of the Board of Directors, and (2) the total number
of meetings held by all committees of the Board of Directors on which that
Director served during the period each served as a Director.
5
<PAGE> 10
The Board of Directors has an Audit Committee, a Board Membership Committee and
a Compensation Committee.
The members of the Audit Committee are Messrs. Keller (Chairman), Hayeck, Hamner
and Pickett. The Committee met four times during 1995. Its function is to review
the accounting and financial reporting practices of the Company and the adequacy
of the Company's system of internal control, to review the scope and adequacy of
internal audit activities and the work of the Company's independent Certified
Public Accountants, and to recommend to the Directors a firm of accountants to
serve as the Company's independent Certified Public Accountants.
The members of the Board Membership Committee are Messrs. Pickett (Chairman),
Hamner, Reed, Near and Thomas and Mrs. Shackelford. The Committee met once
during 1995. Its function is to recommend candidates for membership to the Board
of Directors. The Board Membership Committee will consider nominees recommended
by shareholders, provided that the names of such nominees are submitted in
writing, not later than November 13, 1996, to R. David Thomas, P. O. Box 256,
Dublin, Ohio 43017-0256. Each such submission must include a statement of the
qualifications of the nominee, a consent signed by the nominee evidencing a
willingness to serve as a Director, if elected, and a commitment by the nominee
to meet personally with the Committee members.
The members of the Compensation Committee are Mr. Nutter (Chairman), Mrs.
Shackelford and Mrs. Hill. The Compensation Committee met four times during
1995. The Compensation Committee's function is to examine the levels and methods
of compensation employed by the Company with respect to the individuals named or
to be named in the Company's proxy statement, to review and evaluate alternative
and additional compensation programs for these individuals, and to make
recommendations to the Board of Directors on such matters. The Compensation
Committee has the authority to make all decisions regarding the individuals to
whom options are to be granted under the Company's stock option plans, and the
timing, pricing, number of options to be granted and the other terms of such
grants (the Compensation Committee does not have the authority to amend the
terms of the stock option plans or to adopt new stock option plans). In
addition, the Compensation Committee has the authority to adopt one or more cash
bonus plans which will qualify compensation paid thereunder as
"performance-based compensation" within the meaning of Section 162(m) of the
Internal Revenue Code of 1986, as amended, and to implement and administer such
plans.
In addition to the three committees set forth above, the Board of Directors has
an Executive Committee and a Finance Committee.
Directors who are not employees of the Company are paid $7,000 quarterly, plus
$1,500 for each Board meeting and $1,000 for each qualified committee meeting
attended, including telephonic meetings, for all services, plus expenses. If
more than one qualified meeting is held on the same day, a separate fee is paid
for each such meeting. Meetings of the Audit and Compensation Committees are
qualified meetings, together with any special committees established from time
to time.
Directors who are not employees of the Company also receive grants of stock
options under Part II of the Company's 1990 Stock Option Plan. Each Director who
is not an employee of the Company receives an annual grant of options to
purchase 1,100 common shares. The option exercise price is 100% of the fair
market value of the Company's common shares on the date of grant. Options are
granted on the date on which the regularly scheduled Board meeting is held
during the Company's third fiscal quarter. Each option is granted for a period
of 10 years. 25% of the options granted each year become exercisable on each of
the first four anniversaries of the grant date for such options.
6
<PAGE> 11
- --------------------------------------------------------------------------------
COMPENSATION OF MANAGEMENT
The following table summarizes compensation awarded or paid to, or earned by,
each of the named Executive Officers during each of the Company's last three
fiscal years.
<TABLE>
<CAPTION>
SUMMARY COMPENSATION TABLE
LONG-TERM
COMPENSATION
------------
ANNUAL COMPENSATION SECURITIES ALL OTHER
NAME AND PRINCIPAL ------------------------ UNDERLYING COMPENSATION
POSITION YEAR SALARY ($) BONUS ($) OPTIONS (#) ($)(1)
- ------------------------------ ----- ---------- --------- ------------ ------------
<S> <C> <C> <C> <C> <C>
Gordon F. Teter, 1995 571,385 963,113 208,555 4,684
President, Chief 1994 436,865 536,308 82,398 6,085
Executive Officer and 1993 395,577 476,915 82,401 6,179
Chief Operating Officer
James W. Near, 1995 693,538 481,556 108,925 4,684
Chairman of the Board 1994 657,769 850,114 139,947 6,085
1993 618,808 708,251 140,746 6,179
R. David Thomas, 1995 805,671(2) 481,556 109,535 6,236
Senior Chairman of the 1994 798,214(2) 425,058 378,974 7,637
Board and Founder 1993 736,674(2) 287,500 0 6,179
John K. Casey, 1995 356,308 461,109 58,078 4,017
Vice Chairman and 1994 336,385 449,624 60,535 5,024
Chief Financial 1993 316,462 398,653 60,956 6,179
Officer
Charles W. Rath 1995 277,231 318,761 36,434 4,684
Executive Vice 1994 260,673 306,196 38,079 6,085
President 1993 245,673 273,747 38,477 6,179
</TABLE>
- ---------
(1) The amounts shown in this column for each named Executive Officer consist of
(i) aggregate contributions or other allocations to the Company's defined
contribution plans of $2,288, $3,689 and $3,239 made in 1995, 1994 and 1993,
respectively; and (ii) executive health insurance premiums paid by the
Company for coverage for the named Executive Officers as follows:
<TABLE>
<CAPTION>
NAME 1995 1994 1993
- ------------------------------ ------ ------ ------
<S> <C> <C> <C>
Mr. Teter..................... $2,396 $2,396 $2,940
Mr. Near...................... $2,396 $2,396 $2,940
Mr. Thomas.................... $3,948 $3,948 $2,940
Mr. Casey..................... $1,729 $1,335 $2,940
Mr. Rath...................... $2,396 $2,396 $2,940
</TABLE>
(2) The amounts shown in this column for Mr. Thomas include payments made to Mr.
Thomas for services rendered as the principal spokesman in the Company's
television and radio commercials (the "Advertising Payments") in the amounts
of $251,209, $273,637 and $241,097 in 1995, 1994 and 1993, respectively. Mr.
Thomas was paid for these services at the minimum rate permitted by
applicable union contract provisions. The Advertising Payments were not
acted on by the Compensation Committee since they were not made for services
rendered by Mr. Thomas in his capacity as an Executive Officer. The
Advertising Payments are therefore not included in the compensation data set
forth in the section of this Proxy Statement entitled "REPORT OF THE
COMPENSATION COMMITTEE ON EXECUTIVE COMPENSATION" (which begins on page 10).
7
<PAGE> 12
The following table sets forth information concerning individual grants of stock
options made during the last fiscal year to each of the named Executive
Officers.
<TABLE>
<CAPTION>
OPTIONS GRANTED IN LAST FISCAL YEAR
INDIVIDUAL GRANTS
- -------------------------------------------------------------------------------------------------
NUMBER OF
SECURITIES % OF TOTAL
UNDERLYING OPTIONS
OPTIONS GRANTED TO EXERCISE GRANT DATE
GRANTED EMPLOYEES IN PRICE EXPIRATION PRESENT VALUE
NAME (#)(1) FISCAL YEAR ($/SHARE)(2) DATE $(3)
- ------------------------------ -------------- ------------ ------------ ---------- -------------
<S> <C> <C> <C> <C> <C>
Gordon F. Teter............... 75,000(4) 3.31% $17.1875 2/22/05 $ 441,000
133,555 5.91% $18.3125 8/2/05 $ 753,250
James W. Near................. 108,925 4.82% $18.3125 8/2/05 $ 614,337
R. David Thomas............... 109,535 4.82% $18.3125 8/2/05 $ 617,777
John K. Casey................. 58,078 2.5% $18.3125 8/2/05 $ 327,560
Charles W. Rath............... 36,434 1.61% $18.3125 8/2/05 $ 205,488
</TABLE>
- ---------
(1) Except for one grant of options to Mr. Teter (see footnote 4), 25% of the
options listed in this column become exercisable on August 3, 1996. An
additional 25% becomes exercisable each successive August 3. These exercise
dates may be accelerated if the Company is involved in certain
change-in-control transactions as specified in the Company's various stock
option plans. If the Executive Officer's employment is terminated for any
reason other than death, disability or retirement, the options will be
canceled as of the date of such termination. If the Executive Officer's
employment is terminated by reason of his death or disability, the options
will become immediately exercisable and may be exercised at any time during
the 12-month period after his death or date of becoming disabled, subject to
the stated term of the options. If the Executive Officer's employment is
terminated by reason of his retirement, the options may be exercised during
the 48-month period after the retirement date, subject to the stated term of
the options.
(2) The exercise price is the mean of the high and low prices at which common
shares of the Company are traded on the New York Stock Exchange on the date
of grant.
(3) All values shown are pre-tax. Values shown were calculated using the
Black-Scholes option pricing model and the following assumptions: (a) for
all options shown other than the options which are the subject of footnote 4
below, expected volatility .175; risk-free rate of return 6.46%; dividend
yield 1.4%; and an expected time of exercise of seven years; and (b) for the
options which are the subject of footnote 4 below, expected volatility .191;
risk-free rate of return 7.33%; dividend yield 1.4%; and an expected time of
exercise of seven years. No adjustments were made for the non-
transferability of the options or for the risk of forfeiture. The Company is
not aware of any model which will determine with reasonable accuracy a
present value based on future unknown or volatile factors. No gain to the
optionees is possible without an increase in the market price of the
Company's common shares above the market price on the date of grant. If such
increase occurs, all shareholders will benefit commensurately. If no
increase in the market price occurs, optionees will realize no value from
stock options.
(4) 25% of these options became exercisable on February 23, 1996. An additional
25% becomes exercisable each successive February 23. The other material
terms of the options are as set forth in footnote 1 above.
8
<PAGE> 13
The following table sets forth information regarding each individual exercise of
stock options made during the last fiscal year by each of the named Executive
Officers.
<TABLE>
<CAPTION>
AGGREGATED OPTION EXERCISES
IN LAST FISCAL YEAR
AND FISCAL YEAR-END OPTION VALUES
VALUE OF
NUMBER OF UNEXERCISED
SECURITIES UNDERLYING IN-THE-MONEY OPTIONS
UNEXERCISED OPTIONS AT FISCAL YEAR-END
SHARES AT FISCAL YEAR-END (#) ($)(1)(2)
ACQUIRED ON VALUE REALIZED --------------------------- ---------------------------
NAME EXERCISE (#) ($)(1) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- ------------------- ------------ --------------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Gordon F. Teter.... 145,091 $1,504,233 121,588 331,486 $ 976,001 $ 1,533,921
James W. Near...... 6,250 $ 38,281 1,211,716 321,940 $16,270,821 $ 1,780,749
R. David Thomas.... 0 $ 0 94,743 393,766 $ 375,208 $ 1,447,397
John K. Casey...... 71,467 $ 629,252 93,554 149,939 $ 756,897 $ 799,695
Charles W. Rath.... 132,646 $1,373,641 0 94,341 $ 0 $ 503,740
</TABLE>
- ---------
(1) All values as shown are pre-tax.
(2) Based on the fiscal year-end closing price of $21.25 per share.
The following table sets forth the estimated total retirement benefit that would
be payable to Executive Officers (and other officers) from the qualified and
supplemental retirement plans combined of the Company.
<TABLE>
<CAPTION>
ESTIMATED ANNUAL PENSION PAYABLE AT AGE
65,
FINAL AVERAGE BASED ON YEARS OF SERVICE INDICATED (1)
COMPENSATION ------------------------------------------
AT AGE 60 5 10 15 OR MORE (2)
- ----------------------------------------------- ---------- -------- --------------
<S> <C> <C> <C>
$100,000....................................... $ 16,667 $ 33,333 $ 50,000
$150,000....................................... $ 25,000 $ 50,000 $ 75,000
$200,000....................................... $ 33,333 $ 66,667 $100,000
$250,000....................................... $ 41,667 $ 83,333 $125,000
$300,000....................................... $ 50,000 $100,000 $150,000
$400,000....................................... $ 66,667 $133,333 $200,000
$500,000....................................... $ 83,333 $166,667 $250,000
$600,000....................................... $ 100,000 $200,000 $300,000
$700,000....................................... $ 116,667 $233,333 $350,000
$800,000....................................... $ 133,333 $266,667 $400,000
$900,000....................................... $ 150,000 $300,000 $450,000
$1,000,000..................................... $ 166,667 $333,333 $500,000
$1,100,000..................................... $ 183,333 $366,667 $550,000
$1,200,000..................................... $ 200,000 $400,000 $600,000
$1,300,000..................................... $ 216,667 $433,333 $650,000
$1,400,000..................................... $ 233,333 $466,667 $700,000
</TABLE>
- ---------
(1) Based on benefits commencing at age 65 and the employee continuing
employment with the Company or its subsidiaries until age 65.
(2) The amount of the benefit payable at age 65 would not exceed the amount
shown in this column even if the employee had more than 15 years of service.
The Company has three retirement plans which apply to Executive Officers in
addition to other Officers and/or employees. Mr. Thomas is the sole remaining
participant in a fourth plan, and he does not
9
<PAGE> 14
continue to accrue benefits under that plan. The table set forth above shows the
estimated total retirement benefits that would be payable from all plans
combined.
The benefits listed in the above table are based on final average compensation
at age 60 for a participant, with termination of employment and payments
commencing at age 65. Final average compensation is one-fifth of the highest
aggregate compensation received during five consecutive calendar years within
the last 10 complete calendar years of employment preceding the participant's
attainment of age 60. "Compensation" for purposes of the retirement plans is
defined as the sum of all amounts includable for W-2 purposes and paid by the
Company to an employee and amounts of pay reduced in accordance with an
arrangement established by the Company which qualifies under Section 125 or
Section 401(k) of the Internal Revenue Code of 1986, as amended, except that
prizes, awards, imputed income from excess group life insurance amounts, moving
expenses, adjustments for cost of living, housing allowances, compensation
arising from the leasing of automobiles by the Company, income tax differentials
and other similar differentials are not included in the definition of
"compensation". Due to differences in the definition of "compensation" between
the applicable regulations of the Securities and Exchange Commission and the
Internal Revenue Service, the amounts shown as annual compensation in the
Summary Compensation Table are different than the amount of "compensation" used
to determine benefits payable to the Company's retirement plans. The amounts
shown as annual compensation in the Summary Compensation Table include bonus
amounts paid to the named Executive Officers in 1996 for the Company's
performance in its 1995 fiscal year, and excludes amounts paid to the named
Executive Officers in 1995 based on the Company's performance during its 1994
fiscal year. The final average compensation amounts as of the end of fiscal year
1995 for Messrs. Teter, Near, Thomas, Casey and Rath are $792,081, $1,211,141,
$480,544, $382,512 and $466,817, respectively.
Benefits vest after a participant has attained five years of service. Messrs.
Teter, Near, Thomas, Casey and Rath have been credited with 8, 15, 26, 15 and 9
years of service, respectively, under the plans.
The estimated annual pension amounts are computed on a single straight-life
annuity payment basis. Benefits listed in the table are not subject to deduction
for Social Security or other offset amounts.
Company contributions or accruals on behalf of each named Executive Officer
under the Company's defined contribution plans were included in the "All other
compensation" column of the Summary Compensation Table.
Notwithstanding anything to the contrary as set forth in any of the Company's
previous filings under the Securities Act of 1933, as amended, or the Securities
Exchange Act of 1934, as amended, that might incorporate future filings,
including this Proxy Statement, in whole or in part, the following Report and
the performance graph on page 16 shall not be incorporated by reference into any
such filings.
- --------------------------------------------------------------------------------
REPORT OF THE COMPENSATION COMMITTEE ON EXECUTIVE COMPENSATION
The Company's executive compensation policy has been "pay for performance" since
well before the current popularity of that concept. In an effort to provide
shareholders with a better understanding of the Company's executive compensation
practices, this report provides information beyond the information required by
the proxy rules issued in 1992 by the Securities and Exchange Commission.
The Executive Officers named in the Summary Compensation Table (see page 7) have
significant years of experience in the food-service industry, including over 75
years of experience in the Wendy's system. Each of those individuals possess
talents and abilities which together make up a management team unique in the
industry. The Company and its shareholders have benefited and continue to
benefit from the skill, dedication and judgment of this team. The Committee
believes that the overall compensation levels paid to the named Executive
Officers reflect the performance of those individuals.
COMPENSATION PHILOSOPHY
The Company's executive compensation program is based on two objectives:
Providing market-competitive compensation opportunities, and
10
<PAGE> 15
Creating a strong link between the interests of the shareholders, the
Company's financial performance, and the total compensation of the
Company's Executive Officers.
There are three components to the Company's executive compensation program:
annual cash compensation, longer-term incentive compensation and benefits. The
annual cash compensation program is comprised of base salary and annual
incentive compensation. Base salary and annual incentive compensation
opportunities are set by periodic comparison to external rates of pay for
comparable positions within the food-service industry. The companies used for
this comparison are comprised of the participants in the National Chain
Restaurant Compensation Association annual survey and the same companies which
comprise the "Restaurant Index" shown on the graph on page 16, except that
compensation data for Perkins Family Restaurants, L.P. is not used because such
data is not publicly available.
Base salaries are targeted at the 50th percentile of competitive data.
Individual variability is based on performance and experience. Adjustments are
normally considered annually, based upon general movement in external salary
levels, individual performance and potential, and/or changes in the position's
duties and responsibilities.
Annual incentive compensation opportunities are targeted at the 50th percentile
of competitive data. The Company had three cash bonus plans which applied to
Executive Officers for the 1995 fiscal year. Under the Senior Executive Earnings
Maximization Plan (the "SEEMP") (which Messrs. Teter, Near and Thomas
participated in during fiscal 1995) and the Earnings Maximization Plan (the
"EMP") (which other Executive Officers participated in), participants received
annual incentive awards which were based on the extent to which the Company
exceeded specified net income goals for the year. The net income goals for the
SEEMP were established in 1994 and increase annually. The net income goals for
the EMP were established in 1991 and increase annually. The goals for both plans
have been specified through the Company's 1998 fiscal year. Under the Management
Incentive Plan, 1995 incentive awards were based on the extent to which the
Company achieved or exceeded specified earnings per share and return on assets
goals for the year. The awards to participants under this plan were based on the
payout percentages specified in the following table multiplied by the
participant's base salary and the targeted bonus percentage applicable to such
employee's grade (which ranged from 12% to 25% of base salary). For 1995 the
Company attained between 100 percent and 109.9 percent of its earnings per share
goal and between 85 percent and 89.9 percent of its return on assets goal.
MANAGEMENT INCENTIVE PLAN PAYOUT PERCENTAGES
<TABLE>
<CAPTION>
% ATTAINMENT
<S> <C> <C> <C> <C> <C> <C>
E 120.0%+ 75.00% 112.50% 135.00% 142.50% 150.00% 157.50%
A 110.0%-119.9% 62.50% 93.75% 112.50% 118.75% 125.00% 131.25%
R 100.0%-109.9%(1) 50.00% 75.00% 90.00% 95.00% 100.00% 105.00%
N 85.0%- 99.9% 37.50% 56.25% 67.50% 71.25% 75.00% 78.75%
I 80.0%- 84.9% 25.00%(2) 37.50% 45.00% 47.50% 50.00% 52.50%
N ----------- ----------- ----------- ----------- ------------- -------------
G % ATTAINMENT 80.0%-84.9% 85.0%-89.9%(1) 90.0%-94.9% 95.0%-99.9% 100.0%-104.9% 105.0%-109.9%
S
P
E % ATTAINMENT
R
S 120.0%+ 165.00% 187.50% 225.00%
H 110.0%-119.9% 137.50% 156.25% 187.50%
A 100.0%-109.9%(1) 110.00% 125.00% 150.00%
R 85.0%- 99.9% 82.50% 93.75% 112.50%
E 80.0%- 84.9% 55.00% 62.50% 75.00%
------------- ------------- -------
% ATTAINMENT 110.0%-114.9% 115.0%-119.9% 120.0%+
RETURN ON ASSETS
</TABLE>
- ---------
(1) Indicates percentage of attainment applicable for fiscal year 1995.
(2) Less than 80% budget attainment in either payout criteria results in a 0%
bonus factor.
Total annual cash compensation may be well below the 50th percentile when target
performance is not achieved. When targets are significantly exceeded, total
annual cash compensation may equal or exceed the 75th percentile .
11
<PAGE> 16
The longer-term incentive compensation program primarily consists of stock
options (although one of the cash incentive award programs has a longer-term
orientation, since the annual financial performance goals have been specified
through fiscal 1998). Award opportunities under the stock option program are
also set by periodic comparison to stock option grants made to comparable
positions within the food-service industry, and are set at approximately the
75th percentile. The companies used for this comparison are the same companies
which comprise the "Restaurant Index" shown on the graph on page 16, except that
compensation data for Perkins Family Restaurants, L.P. is not used because such
data is not publicly available. Options are exercisable at not less than 100% of
the fair market value of the Company's common shares on the date of grant. Award
opportunities under the stock option program are based on a fixed number of
options for each eligible employee grade. The fixed number of options to be
awarded will be adjusted periodically by comparison to comparable positions
within the food-service industry. As a result, the Black-Scholes value of
options awarded will increase or decrease based on how the Company's stock price
has changed since the previous year's option awards (assuming that the other
inputs used in the Black-Scholes calculation remain constant). Grantees do not
receive a benefit from stock options unless and until the market price of the
Company's common shares increases. This program accomplishes the objective of
linking each Executive Officer's opportunity for financial gain to increases in
shareholder wealth, as reflected by the market price of the Company's common
shares.
The benefits program is comprised of retirement income and group insurance
plans. The objective of the program is to provide Executive Officers with
reasonable and competitive levels of protection against the four contingencies
(retirement, death, disability and ill health) which will interrupt the
Executive Officer's employment and/or income received as an active employee. The
retirement program consists of two tax-qualified plans that cover all full-time
management and administrative employees, and a supplemental retirement plan
which covers the Executive Officers and other Officers of the Company. Mr.
Thomas is the sole remaining participant in a fourth retirement plan, and he
does not continue to accrue benefits under that plan. The group insurance
program consists of life, disability and health insurance benefit plans that
cover all fulltime management and administrative employees and the executive
health care reimbursement plan, which covers Executive Officers and other
Officers.
Section 162(m) of the Internal Revenue Code of 1986, as amended, prohibits a
publicly held corporation, such as the Company, from claiming a deduction on its
federal income tax return for compensation in excess of $1 million paid for a
given fiscal year to the chief executive officer (or person acting in that
capacity) at the close of the corporation's fiscal year and the four most highly
compensated officers of the corporation, other than the chief executive officer,
at the end of the corporation's fiscal year. The $1 million compensation
deduction limitation does not apply to "performance-based compensation". The
Internal Revenue Service issued proposed regulations in December, 1993 which
gave some guidance to publicly-held companies about how to qualify compensatory
plans to meet the "performance-based compensation" requirements. Final
regulations were issued in December, 1995. The Company adopted a new cash
incentive plan and amended its stock option plans, and obtained shareholder
approval in 1994 with regard to the new cash incentive plan and the amendments
to the stock option plans, in a good faith effort to qualify compensation
received under those plans as "performance-based" for purposes of Section
162(m). The Company will continue to review its compensatory plans and to assess
the desirability of further revisions as the Internal Revenue Service begins to
issue interpretations of the final regulations and competitive practices
continue to emerge.
PAY/PERFORMANCE LINK
The Committee believes that the Company's executive compensation program has
resulted in a positive relationship between the compensation paid to Executive
Officers and the Company's performance. The net income and earnings per share
goals for 1995 were met or exceeded. The Company attained between 85% and 89.9%
of its return on assets goal. As a result, incentive cash compensation was 53%
of the total cash compensation paid to Executive Officers for 1995.
Total cash compensation (salary and bonus) for Mr. Teter and for the named
Executive Officers as a group increased 57.7% and 7.8%, respectively, over the
prior year. For the same years, excluding the
12
<PAGE> 17
effects of the Tim Hortons transaction and the non-recurring expenses associated
therewith, the Company's net income increased 22.3% to $118,824,000 (or $1.09
per share, fully diluted) from $97,156,000 (or $.91 per share, fully diluted).
The Company's fully diluted earnings per share (excluding the effects of the Tim
Hortons transaction and the non-recurring expenses associated therewith) have
risen 165.9% since 1990, while the average total cash compensation for the named
Executive Officers has risen 123.2%. The following table and graphs show the
correlation between the Company's performance, measured as earnings per share
(excluding the effects of the Tim Hortons transaction and the non-recurring
expenses associated therewith), and the average total cash compensation for the
Chief Executive Officer and the named Executive Officers since 1990.
<TABLE>
<CAPTION>
1991 1992 1993 1994 1995
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
Percentage change from prior year in earnings per
share (fully diluted).......................... 26.8% 21.2% 20.6% 19.7% 19.8 (1)
Percentage change from prior year in average cash
compensation for named Executive Officers...... 25.8% 22.8% 12.0% 13.4% 7.8%
Percentage change from prior year in cash
compensation for CEO........................... 30.1% 31.1% 8.0% 13.6% 57.7 (2)
</TABLE>
- ---------
(1) Excludes the effects of the Tim Hortons transaction and the non-recurring
expenses associated therewith.
(2) Mr. Teter became Chief Executive Officer on January 1, 1995.
13
<PAGE> 18
EARNINGS PER SHARE
<TABLE>
<CAPTION>
Measurement Period
(Fiscal Year Covered) wendys
<S> <C>
1990 0.41
1991 0.52
1992 0.63
1993 0.76
1994 0.91
1995 1.09
</TABLE>
AVERAGE CASH COMPENSATION FOR NAMED EXECUTIVE OFFICERS
<TABLE>
<CAPTION>
Measurement Period
(Fiscal Year Covered) wendys
<S> <C>
1990 490017
1991 616292
1992 756901
1993 847481
1994 960787
1995 1031804
</TABLE>
CASH COMPENSATION OF CEO
<TABLE>
<CAPTION>
Measurement Period
(Fiscal Year Covered) wendys
<S> <C>
1990 720000
1991 936800
1992 1228462
1993 1327059
1994 1507883
1995 1534498
</TABLE>
14
<PAGE> 19
The following table shows the total cash compensation paid to the Chief
Executive Officer and to the named Executive Officers since 1990 as a percentage
of the increase in the Company's market capitalization. Cash compensation paid
to the Chief Executive Officer and the average cash compensation paid to the
five named Executive Officers was a small percentage of the overall wealth
created for shareholders since 1990, expressed as a percentage of market
capitalization.
<TABLE>
<CAPTION>
1991 1992 1993 1994 1995
----- ------ ------ ------ -------
<S> <C> <C> <C> <C> <C>
Market capitalization (1)
(millions)........................... $ 962 $1,248 $1,751 $1,463 $ 2,210
Percentage change from prior year in
market capitalization................ 59.0% 29.7% 40.3% (16.4%) 51.1%
Average cash compensation for five
named Executive Officers as a
percentage of market capitalization
increase............................. .17% .26% .17% --(2) .14%
Cash compensation of CEO as a
percentage of market capitalization
increase............................. .26% .43% .26% --(2) .21%(3)
</TABLE>
- ---------
(1) Calculated as closing price on the last day of the fiscal year multiplied by
the number of common shares issued at year end.
(2) Not calculable since market capitalization decreased from 1993 to 1994.
(3) Mr. Teter became Chief Executive Officer on January 1, 1995.
COMPENSATION FOR CHIEF EXECUTIVE OFFICER
Mr. Teter became the Chief Executive Officer of the Company on January 1, 1995.
He also retained the titles of President and Chief Operating Officer. The total
increase in the Company's market capitalization for 1995 over 1994 was $747
million. The increase in Mr. Teter's annual cash compensation for the same
period was $561,325, or eight hundreths of one percent (.08%) of the increase in
market capitalization.
Mr. Teter's base salary rate for 1995 was targeted somewhat below the 50th
percentile of competitive data. His base salary rate for 1995 was a 34.8%
increase over his salary in 1994 due to his promotion to Chief Executive
Officer. In setting Mr. Teter's base salary level, the Compensation Committee
also considered Mr. Teter's vast experience in the quick-service restaurant
industry and the Company's performance under his leadership as President and
Chief Operating Officer.
An annual cash incentive award is payable to Mr. Teter only if the Company
achieves or exceeds specified annual net income goals. The amount of the award
can increase if the Company exceeds the specified goals. Conversely, no award is
payable if the Company does not achieve the specified goals. The payment to Mr.
Teter for 1995 was based on the Company exceeding its 1995 goals. 63% of Mr.
Teter's cash compensation for 1995 was incentive pay. Since the incentive award
increases as the Company's performance increases, and decreases (or becomes
zero) if the specified goals are not met, Mr. Teter's cash compensation is
significantly affected by the Company's performance.
Long-term incentives in the form of stock options were granted to Mr. Teter in
1995. Stock options were granted at 100% of the fair market value of the
Company's common shares on February 23, 1995 and August 3, 1995, the dates of
grant. Options serve to directly align Mr. Teter's interests with the interests
of other shareholders, since Mr. Teter will not realize a benefit unless and
until the market price of the Company's common shares increases.
The Committee considered the number of unexercised options already held by Mr.
Teter and competitive practices in determining the number of options to grant on
February 23, 1995 in connection with Mr. Teter's promotion to Chief Executive
Officer. The number of options granted on August 3, 1995 to Mr. Teter was
designed to approximate the 75th percentile of competitive practice for
comparable positions within the food-service industry, consistent with the
policy previously described.
15
<PAGE> 20
The Committee believes that the information set forth in this report strongly
supports the conclusion that Mr. Teter has been reasonably compensated for the
job he has done since he became the Chief Executive Officer. His opportunities
to increase his future compensation depend on the Company's future performance
and the competitive pay practices of comparable positions within the
food-service industry. The compensation programs applicable to Mr. Teter have
accomplished the objective of linking shareholder and financial performance to
Mr. Teter's total compensation.
Respectfully submitted,
COMPENSATION COMMITTEE
Fielden B. Nutter, Sr., Chairman
Thekla R. Shackelford
Janet Hill
- --------------------------------------------------------------------------------
COMPARISON OF FIVE-YEAR TOTAL RETURN FOR WENDY'S INTERNATIONAL, INC.,
THE RESTAURANTS INDEX AND THE S&P 500 INDEX
The following graph compares the yearly percentage change in the Company's
cumulative total shareholder return (as measured by dividing (i) the sum of (A)
the cumulative amount of dividends for the measurement period, assuming dividend
reinvestment, and (B) the difference between the Company's share price at the
end and the beginning of the measurement period; by (ii) the share price at the
beginning of the measurement period) against the cumulative total return of the
S&P 500 Stock Index and an index comprised of the "restaurant companies"
(excluding the Company) that were listed in the Value Line Investment Survey(C)
(the "Restaurant Index").
[LINE GRAPH]
<TABLE>
<CAPTION>
1990 1991 1992 1993 1994 1995
<S> <C> <C> <C> <C> <C> <C>
WEN $100.00 162.31 211.56 296.00 268.59 372.40
S&P INDEX 100.00 130.55 140.72 154.91 157.39 216.42
RESTAURANTS INDEX 100.00 132.48 166.45 189.59 187.35 270.06
</TABLE>
- ---------
(1) Assumes $100 invested on December 31, 1990, in Wendy's International, Inc.
common shares, the Restaurants Index and the S&P 500 Index. Total return
assumes dividend reinvestment.
(2) The Restaurants Index has been computed by the Company, and is comprised of
the following 16 companies: Bob Evans Farms, Inc.; CKE Restaurants; Frisch's
Restaurants, Inc.; International Dairy Queen; Luby's Cafeterias, Inc.;
McDonald's Corporation; Morrison Restaurants, Inc.; NPC
16
<PAGE> 21
International, Inc.; Perkins Family Restaurants, L.P.; Piccadilly
Cafeterias, Inc.; Ryan's Family Steak Houses, Inc.; Shoney's, Inc.; Sizzler
International, Inc.; Summit Family Restaurants Inc.; TCBY Enterprises, Inc.;
and VICORP Restaurants, Inc. It excludes Wendy's International, Inc., the
17th "restaurant company" in the Value Line Investment Survey(C) on the
relevant date. This Index has been weighted by market capitalization of each
component company. Component companies in the Restaurants Index were the
restaurant companies listed in the Value Line Investment Survey(C) Edition 2
dated December 25, 1992. The Value Line Investment Survey(C) is published by
Value Line Publishing Inc.
- --------------------------------------------------------------------------------
EXECUTIVE AGREEMENTS
The Company has entered into employment agreements ("Key Executive Agreements")
with Messrs. James W. Near and R. David Thomas. The Company has also entered
into employment agreements ("New Key Executive Agreements") with Messrs. John F.
Brownley, John K. Casey, George Condos, Lawrence A. Laudick, Ronald E. Musick,
Edwin L. Ourant, Charles W. Rath, Lawrence E. Schauf, John T. Schuessler, Gordon
F. Teter and John W. Wright. The Key Executive Agreements and the New Key
Executive Agreements (collectively the "Agreements") are intended to assure the
Company that it will have the continued dedication, undivided loyalty, and
objective advice and counsel from these key executives in the event of a
proposed transaction, or the threat of a transaction, which could result in a
change of control of the Company.
Messrs. Brownley, Casey, Laudick, Musick, Ourant, Rath, Schauf and Teter had
previously entered into Key Executive Agreements with the Company. The New Key
Executive Agreements were executed in 1989 with those key executives to replace
and clarify certain provisions, to provide protections to both the Company and
the covered executives consistent with current executive compensation practices,
and to reduce the costs to the Company. Except as otherwise noted, the
provisions of the New Key Executive Agreements are substantially the same as the
provisions of the Key Executive Agreements.
The Agreements provide that in the event of a change of control (as defined in
the respective Agreements), the key executives will be employed by the Company
in their present positions for a period of approximately five years (ten years
in the case of Mr. Thomas), or until the executive dies, is terminated for good
cause by the Company or terminates employment himself without good reason or
good cause, or, in the case of the Key Executive Agreements, reaches the normal
retirement age, whichever occurs first (the "Employment Term").
In the event of a change of control, the key executives will be entitled to
continue to receive during their Employment Term the annual salary, bonus, and
other benefits made available to them by the Company immediately prior to the
change of control. The Board of Directors will review annually the performance
of each key executive during such Employment Term to determine whether or not
such salary and bonus should be increased.
The Agreements may be terminated for good cause by the Company as defined in the
respective Agreements. If a key executive is terminated for good cause by the
Company under either Agreement, the Company has no further obligation to pay any
compensation or to provide benefits to the key executive.
The Key Executive Agreement may be terminated by the key executive for good
cause if the Company assigns him to a position of lesser importance, the Company
attempts to terminate his employment other than for good cause or the Company
breaches any of its obligations under the Key Executive Agreement. The New Key
Executive Agreement may be terminated by the key executive for good reason if
the Company (i) changes the key executive's status, title, position or
responsibilities in a way that does not represent a promotion, (ii) either
reduces the key executive's base salary or provides an annual salary increase
less than the increase in a defined consumer price index, (iii) requires the key
executive to relocate beyond a 30 mile radius from Dublin, Ohio, (iv) takes
action which results in a material reduction in compensation and benefits
otherwise payable to the key executive, (v) materially breaches the Agreement,
or (vi) fails to notify the key executive that a successor to the Company has
agreed to perform under the Agreement.
17
<PAGE> 22
If the Key Executive Agreement is terminated by the key executive for good
cause, the Company is obligated to continue to pay the compensation and to
provide the benefits to the key executive for the remainder of the Employment
Term, subject to offset for any compensation earned by the key executive from
subsequent employment. If the New Key Executive Agreement is terminated by the
key executive for good reason, the Company will be obligated to make a lump-sum
payment to the key executive of three times the sum of such executive's current
salary plus average annual bonuses over the prior three years (or the term of
employment, if less than three years). The lump-sum payment will not be subject
to offset. If a key executive terminates a New Key Executive Agreement for good
reason, such key executive will also be entitled to (i) continuation of group
insurance benefits for three years, subject to offset for any benefits from
subsequent employment, if any, (ii) purchase his or her Company automobile at
the then-current book value, and (iii) a lump-sum payment equal to the present
value of accrued retirement benefits after adding three additional years of
benefit accrual, reduced by any vested benefits. In addition, any awards granted
under all long-term incentive plans of the Company (including, without
limitation, options granted under the Company's stock option plans) will become
immediately vested.
The New Key Executive Agreements with Messrs. Casey and Musick will also require
the Company to gross-up the payments made under such Agreements to permit these
key executives to receive a net amount (after taxes) equal to what would have
been received had no excise tax been imposed. The amounts paid to the other key
executives who are parties to the New Key Executive Agreements will be subject
to a maximum benefit where such payment results in an excise tax liability to
the individual. In such case, the amount otherwise payable to such individual
will be reduced if, and to the extent that, such reduction will entitle the
executive to a larger net benefit, taking into account the payment of any excise
tax.
The Company has established a benefits protection trust to provide for the
payment of benefits to the key executives and to provide for the payment of any
legal fees or expenses incurred by such key executives in enforcing their rights
under the Agreements.
The Company has entered into a Separation and Consulting Agreement with James W.
Near. The Separation and Consulting Agreement recognizes the significant
professional and personal contributions Mr. Near has made to the successful
operation and recognized good will and reputation of the Company. The Agreement
provides for a monthly severance benefit, after termination of employment for
any reason other than death, of one-twelfth of the highest annual base salary of
Mr. Near for the five years preceding the termination of employment. The monthly
severance benefit ends on the earliest of (i) 24 months after termination of
employment, (ii) death, or (iii) attainment of age 65. Until the severance
period expires, Mr. Near will continue to participate in the other employee
benefit plans of the Company.
After the severance period expires (or in the event that Mr. Near does not
retire until age 65), Mr. Near will receive an annuity in monthly installments
equal to one-half of his average annual base salary for the three years
preceding the severance period reduced by the actuarial equivalent of the
aggregate amounts payable to Mr. Near under the other retirement plans of the
Company. Thereafter, if Mr. Near dies and is survived by his wife, she will be
entitled to one-half of the annuity to which Mr. Near would have otherwise been
entitled.
If Mr. Near dies while actively employed by the Company or during the severance
period and is survived by his wife, she will be entitled to one-half of the
annuity to which he would have been entitled had he retired immediately
preceding the date of his death.
The Agreement further provides that Mr. Near will make himself available to
provide advice and counsel to the Company upon request after termination of
employment. The Agreement also provides that the Company may require Mr. Near to
return to active employment for up to 12 months under certain conditions. Mr.
Near is prohibited from competing against the Company for two years following
termination of employment.
18
<PAGE> 23
If Mr. Near is also entitled to receive benefits at the time of the termination
of employment under a Key Executive Agreement, he must elect whether to receive
benefits under that Agreement or the Separation and Consulting Agreement.
The Company entered into an Agreement with Gordon F. Teter in March, 1995. Mr.
Teter became Chief Executive Officer (in addition to retaining his titles of
President and Chief Operating Officer) on January 1, 1995. The Agreement
recognizes the significant professional and personal contributions Mr. Teter has
made to the successful operation and recognized good will and reputation of the
Company. If Mr. Teter ceases to be actively employed by the Company after
attaining age 62 and before attaining age 65 (the "Transition Date"), the
Agreement provides for the continuation of Mr. Teter's salary at the rate of his
highest annual base salary in effect at any time during the five-year period
preceding the date of his termination of employment. The salary continuation
benefits will end on the earliest of (i) 24 months after termination of active
employment, (ii) death, or (iii) attainment of age 65. Until the salary
continuation period expires, Mr. Teter will continue to participate in the other
employee benefit plans and programs of the Company, except that Mr. Teter will
not receive any further stock options or other stock-based awards, Mr. Teter
will only be entitled to receive a pro-rated bonus under the annual cash bonus
plan in effect for the year in which his active employment terminates, and any
benefits Mr. Teter receives from the Company's short-term or long-term
disability plans will offset amounts otherwise payable under the Agreement.
If Mr. Teter's active employment is terminated prior to his attainment of age 62
for any reason other than by reason of his voluntary termination of employment,
death or termination for "cause" as defined in the Agreement, the Agreement
provides for the continuation of Mr. Teter's salary for 24 months at the rate in
effect at the time his active employment is terminated. During such period, Mr.
Teter will continue to participate in certain of the Company's employee benefit
plans in which he was a participant immediately preceding the date his active
employment terminated, receive a pro-rated bonus under the Company's annual cash
bonus plan then in effect for the fiscal year in which his active employment is
terminated, and receive payment for any accrued, unused vacation for the year in
which his termination of active employment occurs. Any benefits Mr. Teter
receives under the Company's short-term or long-term disability plans will be
offset against amounts otherwise payable under this provision. In the event Mr.
Teter accepts other employment while he is receiving benefits under this
provision of the Agreement, he will be required to accept a lump-sum payment
representing the balance of the salary continuation payments otherwise due, and
the other benefits described in this paragraph will immediately terminate. Mr.
Teter's right to receive the benefits described in this paragraph is conditioned
upon his execution of a general release in favor of the Company at the time his
active employment is terminated.
The Agreement also provides for a non-qualified supplemental retirement benefit.
Under the Company's existing retirement plans, Mr. Teter would be entitled to
retirement benefits as set forth in the table on page 9. Those benefits are
based on payments beginning at age 65 and the employee's continuing employment
with the Company or its subsidiaries until age 65. The Agreement establishes a
supplemental account intended to provide full retirement benefits at age 62
rather than age 65 and which recognizes compensation earned until the actual
date of termination of employment. Each year until the year in which the
Transition Date occurs (or, if Mr. Teter's employment terminates before he
attains age 62, the year preceding the year in which his employment terminates),
the supplemental account will be credited in an amount determined by actuarial
calculation to result in the intended retirement benefits. The supplemental
account will be credited with an additional amount equal to .8% of Mr. Teter's
compensation for each such year until termination of employment. This additional
credit is intended to provide funds which Mr. Teter could use to purchase
retiree health insurance upon his termination of employment and the expiration
of the salary continuation period. The supplemental account will also be
credited with interest at the rate at which interest is credited under the
Company's qualified pension plan which applies to Mr. Teter and all of the
Company's other eligible employees.
Mr. Teter can elect whether to take the retirement benefit from the supplemental
account as a lump-sum distribution or over a period not exceeding the joint and
last survivor life expectancies of Mr. Teter and his wife.
19
<PAGE> 24
If Mr. Teter ceases to be actively employed by the Company after attaining age
62 and before attaining age 65, the Agreement provides that (i) Mr. Teter will
make himself available to provide advice and counsel to the Company upon request
during the salary continuation period; (ii) the Company may require Mr. Teter to
return to active employment for up to 12 months under certain conditions; and
(iii) Mr. Teter is prohibited from competing against the Company during the
salary continuation period. If Mr. Teter's employment with the Company is
terminated before he attains age 62, he is prohibited from competing against the
Company for two years following the date of his termination of employment. The
Agreement further provides that Mr. Teter will not be entitled to receive any
payments or benefits specified in the Agreement in the event he violates his
obligations under the Agreement or if his employment is terminated for cause as
defined in the Agreement.
If Mr. Teter's employment is terminated after he attains age 62 under
circumstances which entitle him to receive benefits under his Key Executive
Agreement, no salary continuation payments (or further salary continuation
payments in the event such payments have already commenced) will be paid under
the Agreement unless Mr. Teter waives all rights to any payments or benefits
under the Key Executive Agreement.
- --------------------------------------------------------------------------------
CERTAIN TRANSACTIONS INVOLVING MANAGEMENT
Until October 31, 1995, Kenneth Thomas, the son of R. David Thomas, was a 50%
shareholder in Consolidated Restaurants of California, Inc., which owns the
right to operate eight Wendy's Old Fashioned Hamburgers restaurants in a portion
of Orange County, California. Kenneth Thomas served as a co-Franchise Owner with
the corporation and another individual under the applicable Unit Franchise
Agreements with the Company. Kenneth Thomas sold his interest in Consolidated
Restaurants of California, Inc. on October 31, 1995. In the opinion of the
Company, the terms of these franchises are no less favorable than the Company
could have obtained from unrelated third parties.
From time to time a number of the Company's franchisees have experienced
financial difficulty which have resulted in deferred payments of royalties to
the Company and deferred payments of national advertising obligations to an
affiliate of the Company. Consolidated Restaurants of California, Inc., Kenneth
Thomas, another corporation and two other individuals had executed notes payable
to the Company or its affiliate. The largest aggregate amount of the debt owed
to the Company at any time since January 1, 1995 was $31,995. The aggregate
amount of the debt owed to the Company on December 31, 1995 was $5,823. These
notes, which were paid off in full on February 13, 1996, represented past due
sums payable for royalties, national advertising and late charges and bear
interest at the rate of 10% per annum. In the opinion of the Company, the terms
of these notes were no less favorable than the Company and its affiliate could
have received from unrelated third parties.
Melinda Morse, the daughter of R. David Thomas, is a 49% shareholder in a
corporation which owns the right to operate four Wendy's Old Fashioned
Hamburgers restaurants in Texas. Mrs. Morse serves as a co-Franchise Owner with
the corporation and her husband under the applicable Restaurant Franchise
Agreements with the Company. In the opinion of the Company, the terms of these
franchises are no less favorable than the Company could have obtained from
unrelated third parties.
Molly Postlewaite, the daughter of R. David Thomas, is a 48% shareholder in a
corporation which owned the right to operate one Wendy's Old Fashioned
Hamburgers in Ohio. The corporation operated the restaurant under a Restaurant
Franchise Agreement with the Company. Mrs. Postlewaite and her husband
guaranteed the corporation's obligations under the Restaurant Franchise
Agreement. The corporation sold the restaurant and the franchise rights related
thereto to another franchisee of the Company on October 2, 1995. In the opinion
of the Company, the terms of this franchise were no less favorable than the
Company could have received from an unrelated third party.
David J. Near and Jason W. Near, the sons of James W. Near, are each 50%
shareholders of Pisces Foods, L.L.C., which owns the right to operate two
Wendy's Old Fashioned Hamburgers restaurants in Austin, Texas. David J. Near and
Jason W. Near serve as co-Franchise Owners with the corporation under the
applicable Restaurant Franchise Agreements with the Company. The corporation
acquired the restaurants from the Company on September 21, 1995. The sale price
for the transaction was
20
<PAGE> 25
$2.250 million in cash. The sale price was determined by Walter Fuehrer, the
Vice President of Corporate Development, in conjunction with financial
management of the Company, based on the valuation method the Company generally
uses for franchisee dispositions. In the opinion of the Company, the terms of
this transaction were no less favorable than the Company could have obtained
from unrelated third parties.
John J. Casey and Kevin B. Casey, the sons of John K. Casey, each is a 26%
shareholder of J.K.C. Wen, L.C., which owns the right to operate two Wendy's Old
Fashioned Hamburgers restaurants in Florida. A third shareholder, who is
unrelated to the Caseys, owns the remaining 48% of the corporation. John J.
Casey and Kevin B. Casey serve as co-Franchise Owners with the corporation under
the applicable Restaurant Franchise Agreements with the Company. The corporation
acquired the restaurants from the Company on October 2, 1995. The equipment at
one restaurant and the business intangibles at both restaurants were sold for
$375,000 in cash. The real estate and equipment at one of the restaurants were
leased to the corporation, John J. Casey and Kevin B. Casey for 9% of sales. The
real estate at the other restaurant was leased to the corporation, John J. Casey
and Kevin B. Casey for 6% of sales. The corporation, John J. Casey and Kevin B.
Casey have the option to purchase the leased assets during the third through the
fifth lease year at the price of $1.741 million. The sale price was determined
by Walter Fuehrer, the Vice President of Corporate Development, in conjunction
with financial management of the Company, based on the valuation method the
Company generally uses for franchisee dispositions. The transaction was also
approved by the Board of Directors of the Company. In the opinion of the
Company, the terms of this transaction were no less favorable than the Company
could have obtained from unrelated third parties.
The Company has also entered into two letters of intent with J.K.C. Wen, L.C.,
John J. Casey and Kevin B. Casey pertaining to the disposition of six Wendy's
Old Fashioned Hamburgers Restaurants in Florida. If these transactions are
consummated, J.K.C. Wen, L.C. would own the right to operate those restaurants.
John J. Casey and Kevin B. Casey would serve as co-Franchise Owners with the
corporation under the applicable Restaurant Franchise Agreements with the
Company. For three of the restaurants, the equipment would be sold for $472,000
in cash, the Company would lease the real estate to the corporation, John J.
Casey and Kevin B. Casey for 7.5% of sales, and the corporation would have the
option to purchase the leased assets during the fifth through the ninth lease
years at the price of $1.66 million. For the other three restaurants, the
equipment would be sold for $491,000 in cash, the real estate would be leased or
subleased to the corporation, John J. Casey and Kevin B. Casey for 6.0% of
sales, and the corporation, John J. Casey and Kevin B. Casey would have the
option to purchase the leased assets during the fourth through the ninth lease
years at the price of $2.04 million. The sale prices for both transactions were
determined by Walter Fuehrer, the Vice President of Corporate Development, in
conjunction with financial management of the Company, based on the valuation
method the Company generally uses for franchisee dispositions. The transactions
have been approved by the Board of Directors of the Company. In the opinion of
the Company, the terms of these transactions are no less favorable than the
Company could obtain from unrelated third parties.
Mark C. Ourant, the son of Edwin L. Ourant, a Vice President of the Company, is
a 20% shareholder in a corporation which owns the right to operate a Wendy's Old
Fashioned Hamburgers restaurant in Ohio. Mark C. Ourant serves as a co-Franchise
Owner with the corporation and four other individuals under the applicable
Restaurant Franchise Agreement with the Company. The Company leases the land,
building and equipment for the restaurant to the corporation for 3% of sales
(percentage rent will increase to 7% of sales beginning in 1999). In the opinion
of the Company, the terms of this lease are no less favorable than the Company
could have obtained from unrelated third parties.
Mark C. Ourant and four other individuals also own the right to operate another
Wendy's Old Fashioned Hamburgers restaurant in Ohio. Mr. Ourant serves as a
co-Franchise Owner with the other individuals under the applicable Restaurant
Franchise Agreement with the Company. Mr. Ourant and the other individuals
acquired the restaurant from the Company on January 16, 1995. The sale price for
this transaction was $300,000 cash (for the sale of equipment, signage and
intangibles) and Mr. Ourant and the other individuals assumed the obligations
under the lease pursuant to which the Company had previously operated the
restaurant. The sale price was determined by Walter Fuehrer, the Vice President
of Corporate Development, in conjunction with financial management of the
Company, based
21
<PAGE> 26
on the valuation method the Company generally uses for franchisee dispositions.
In the opinion of the Company, the terms of this transaction were no less
favorable than the Company could have obtained from unrelated third parties.
Arthur I. Vorys, a Director of the Company until January 13, 1995, is of counsel
to the law firm of Vorys, Sater, Seymour and Pease, legal counsel for the
Company, which rendered legal services to the Company during the last fiscal
year and which continues to do so. Mr. Vorys was a partner of the firm until
December 31, 1992. Frederick R. Reed, who became a Director of the Company on
February 23, 1995, is a partner of Vorys, Sater, Seymour and Pease.
- --------------------------------------------------------------------------------
APPROVAL OF AMENDMENT TO THE COMPANY'S REGULATIONS
Section 2.02 of the Company's Regulations presently fixes the maximum number of
Directors at 13, divided into three classes, one class consisting of five
Directors and two classes consisting of four Directors each. There are presently
no vacancies on the Board of Directors, and the class consisting of five
Directors will be elected at the Annual Meeting. The Directors of the Company
propose, and recommend that the shareholders adopt, an amendment to Section 2.02
which would increase the maximum number of Directors to 15, divided into three
classes of five Directors each.
The increase in the maximum number of Directors will enable the Company to
satisfy an agreement with Ronald V. Joyce, entered into in connection with the
acquisition of Tim Hortons, to use its best efforts to appoint Mr. Joyce to the
Company's Board of Directors. Mr. Joyce is Senior Chairman and Co-Founder of The
TDL Group, Ltd., the Company's principal subsidiary operating Tim Hortons, and
is the Company's largest shareholder. If the amendment is approved by
shareholders, it is expected that, pursuant to Section 2.05 of the Regulations,
the Directors will elect Mr. Joyce to fill the vacancy in the class of Directors
whose term expires in 1997. While they have no present plans to fill such
vacancy, the Directors also believe that, by creating an additional position in
the class of Directors whose term of office expires in 1998, the proposed
amendment will enable them to take timely advantage of the availability of
another well-qualified candidate for election to the Board of Directors.
The proposed amendment to Section 2.02 of Article 2 of the Regulations of the
Company reads as follows:
Section 2.02. Number of Directors and Term of Office. The number of
directors of the Company shall be fifteen, divided into three classes
consisting of five directors each. The election of each class of
directors shall be a separate election. At each Annual Meeting one
class consisting of five directors shall be elected, and the persons
so elected shall serve as directors for three years and until their
successors are elected.
The affirmative vote of the holders of not less than a majority of the Company's
outstanding common shares is required to amend the Regulations. Under Ohio law
and the Company's Regulations, abstentions and broker non-votes are counted as
present; and the effect of an abstention or non-vote is the same as a "no" vote.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" ADOPTION OF THE FOREGOING
AMENDMENT TO THE COMPANY'S REGULATIONS. Unless otherwise indicated, the persons
named in the Proxy will vote all shares subject to Proxies in favor of approving
the proposed amendment.
- --------------------------------------------------------------------------------
SELECTION OF INDEPENDENT PUBLIC ACCOUNTANTS
The Directors have selected Coopers & Lybrand L.L.P. as the independent public
accountants of the Company for the current fiscal year. Management recommends
that the shareholders ratify the selection. This firm has audited the Company's
books for each of the last 26 years. Management expects that representatives of
Coopers & Lybrand L.L.P. will be present at the Annual Meeting with the
opportunity to make a statement if they desire to do so and will be available to
respond to appropriate questions. The affirmative vote of the holders of a
majority of the common shares represented in person or by proxy is necessary to
ratify the selection of the Company's independent public accountants. Under Ohio
law and the Company's Code of Regulations, abstentions and broker non-votes are
counted as
22
<PAGE> 27
present; the effect of an abstention or broker non-vote on this proposal is the
same as a "no" vote. Unless otherwise indicated, the persons named in the Proxy
will vote all Proxies in favor of ratifying the selection of the independent
public accountants.
- --------------------------------------------------------------------------------
OTHER MATTERS
SHAREHOLDER PROPOSALS
In order to be considered for inclusion in the proxy statement distributed to
shareholders prior to the Annual Meeting in 1997 a shareholder proposal must be
received by the Company no later than November 13, 1996. Written requests for
inclusion should be addressed to: Corporate Secretary, P. O. Box 256, Dublin,
Ohio 43017-0256. It is suggested that you mail your proposal by certified mail,
return receipt requested.
A COPY OF FORM 10-K AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION WILL BE
SENT TO ANY SHAREHOLDER WITHOUT CHARGE UPON WRITTEN REQUEST ADDRESSED TO
INVESTOR RELATIONS DEPARTMENT, P. O. BOX 256, 4288 WEST DUBLIN-GRANVILLE ROAD,
DUBLIN, OHIO 43017-0256.
Management knows of no other business which may be properly brought before the
Annual Meeting of Shareholders. However, if any other matters shall properly
come before such meeting, it is the intention of the persons named in the
enclosed form of Proxy to vote such Proxy in accordance with their best judgment
on such matters.
IT IS IMPORTANT THAT PROXIES BE RETURNED PROMPTLY. THEREFORE, WHETHER OR NOT YOU
EXPECT TO ATTEND THE MEETING IN PERSON, YOU ARE URGED TO FILL IN, SIGN AND
RETURN THE PROXY IN THE ENCLOSED STAMPED, SELF-ADDRESSED ENVELOPE.
By order of the Board of Directors.
/s/ Lawrence E. Schauf
-------------------------------
LAWRENCE E. SCHAUF
Secretary
23
<PAGE> 28
Map to Wendy's International, Inc.
Annual Meeting of Shareholders
Columbus, Ohio
[MAP]
HOW TO FIND THE FAWCETT CENTER FOR TOMORROW
The Fawcett Center for Tomorrow is located at 2400 Olentangy River Road just
north of the Ohio State University Stadium. Exit EAST from State Route 315 at
Lane Avenue. Drive EAST on Lane to Olentangy River Road. Turn LEFT (north). The
parking lot entrance is only a short distance further on your right. No charge
for parking.
Monday, April 30, 1996
Meeting begins at 10:00 a.m. Doors open at 9:30 a.m.
Fawcett Center for Tomorrow -- The Ohio State University
2400 Olentangy River Road -- (614) 292-3238
For further information, call 1-800-443-7266 and ask for extension 3251.
<PAGE> 29
WENDY'S INTERNATIONAL, INC.
PROXY SOLICITED ON BEHALF OF BOARD OF DIRECTORS OF THE COMPANY FOR
ANNUAL MEETING APRIL 30, 1996
The undersigned hereby constitutes and appoints R. David Thomas,
James W. Near and John K. Casey, and each of them, his true and
lawful agents and proxies with full power of substitution in each,
to represent the undersigned at the Annual Meeting of Shareholders
of Wendy's International, Inc. to be held at the Fawcett Center for
Tomorrow, The Ohio State University, 2400 Olentangy River Road,
Columbus, Ohio 43210, on Tuesday, April 30, 1996, and at any
adjournments thereof, on all matters coming before said meeting.
YOU ARE ENCOURAGED TO SPECIFY YOUR CHOICES BY MARKING THE
APPROPRIATE BOXES, SEE REVERSE SIDE, BUT YOU NEED NOT MARK ANY BOXES
IF YOU WISH TO VOTE IN ACCORDANCE WITH THE BOARD OF DIRECTORS'
RECOMMENDATIONS. THE PROXIES CANNOT VOTE YOUR SHARES UNLESS YOU SIGN
AND RETURN THIS CARD.
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER
DIRECTED HEREIN. IF NO DIRECTION IS MADE, THIS PROXY WILL BE VOTED
FOR ELECTION OF DIRECTORS, FOR APPROVAL OF AN AMENDMENT TO THE COMPANY'S
REGULATIONS AND FOR APPROVAL OF INDEPENDENT ACCOUNTANTS.
COMMENTS: (Change of address)
--------------------------------------------------------------------
--------------------------------------------------------------------
--------------------------------------------------------------------
(IF YOU HAVE WRITTEN IN THE ABOVE SPACE, PLEASE MARK THE
CORRESPONDING BOX ON THE REVERSE SIDE OF THE CARD)
SEE REVERSE
SIDE
<PAGE> 30
<TABLE>
<CAPTION>
<S> <C> _____
/X/ PLEASE MARK YOUR | |
VOTES AS IN THIS | |______
EXAMPLE.
NOMINEES: Thekla R. Shackelford, Ronald E. Musick, W. Clay Hamner, Gordon F. Teter and Frederick R. Reed
FOR WITHHELD FOR AGAINST ABSTAIN
1. Election of / / / / 2. Approval of amendment to Company's / / / / / /
Regulations
3. Approval of Independent Accountants / / / / / /
4. In their discretion, the proxies are
authorized to vote on such other business
as may properly come before the meeting
FOR, except vote withheld from the following nominee(s): Change of / /
Address/Comments
on reverse side
_________________________________________________________
I plan to / / I do not / /
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE NOMINEES FOR DIRECTORS AND FOR attend plan to
PROPOSALS 2 AND 3. meeting attend meeting
SIGNATURE(S)_________________________________________ DATE_____________
NOTE: Please sign exactly as name appears hereon. Joint owners should
each sign. When signing as attorney, executor, administrator,
trustee or guardian, please give full title as such. I hereby
revoke all proxies heretofore given by me to vote at said meeting
or any adjournments thereof.
</TABLE>
