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These excerpts taken from the WEN 10-K filed Mar 13, 2009. Franchised
Restaurants
As of December 28, 2008, Wendy’s
franchisees operated 5,224 Wendy’s restaurants in 50 states, Canada and 20 other
countries and U. S. territories.
The rights and obligations governing
the majority of franchised restaurants operating in the United States are set
forth in the Wendy’s Unit Franchise Agreement. This document provides the
franchisee the right to construct, own and operate a Wendy’s restaurant upon a
site accepted by Wendy’s and to use the Wendy’s system in connection with the
operation of the restaurant at that site. The Unit Franchise Agreement provides
for a 20-year term and a 10-year renewal subject to certain conditions. Wendy’s
has in the past franchised under different agreements on a multi-unit basis;
however, Wendy’s now generally grants new Wendy’s franchises on a unit-by-unit
basis.
The Wendy’s Unit Franchise Agreement
requires that the franchisee pay a royalty of 4% of gross sales, as defined in
the agreement, from the operation of the restaurant. The agreement also
typically requires that the franchisee pay Wendy’s a technical assistance fee.
In the United States, the standard technical assistance fee required under a
newly executed Unit Franchise Agreement is currently $25,000 for each
restaurant. - 6
-
The technical assistance fee is used to
defray some of the costs to Wendy’s in providing technical assistance in the
development of the Wendy’s restaurant, initial training of franchisees or their
operator and in providing other assistance associated with the opening of the
Wendy’s restaurant. In certain limited instances (like the regranting of
franchise rights or the relocation of an existing restaurant), Wendy’s may
charge a reduced technical assistance fee or may waive the technical assistance
fee. Wendy’s does not select or employ personnel on behalf of
franchisees.
Wendy’s
currently does not offer any financing arrangements to franchisees seeking to
build new franchised units Franchised Restaurants As of December 28, 2008, Wendy’s franchisees operated 5,224 Wendy’s restaurants in 50 states, Canada and 20 other countries and U. S. territories. The rights and obligations governing the majority of franchised restaurants operating in the United States are set forth in the Wendy’s Unit Franchise Agreement. This document provides the franchisee the right to construct, own and operate a Wendy’s restaurant upon a site accepted by Wendy’s and to use the Wendy’s system in connection with the operation of the restaurant at that site. The Unit Franchise Agreement provides for a 20-year term and a 10-year renewal subject to certain conditions. Wendy’s has in the past franchised under different agreements on a multi-unit basis; however, Wendy’s now generally grants new Wendy’s franchises on a unit-by-unit basis. The Wendy’s Unit Franchise Agreement requires that the franchisee pay a royalty of 4% of gross sales, as defined in the agreement, from the operation of the restaurant. The agreement also typically requires that the franchisee pay Wendy’s a technical assistance fee. In the United States, the standard technical assistance fee required under a newly executed Unit Franchise Agreement is currently $25,000 for each restaurant. - 6 - - The technical assistance fee is used to defray some of the costs to Wendy’s in providing technical assistance in the development of the Wendy’s restaurant, initial training of franchisees or their operator and in providing other assistance associated with the opening of the Wendy’s restaurant. In certain limited instances (like the regranting of franchise rights or the relocation of an existing restaurant), Wendy’s may charge a reduced technical assistance fee or may waive the technical assistance fee. Wendy’s does not select or employ personnel on behalf of franchisees. Wendy’s currently does not offer any financing arrangements to franchisees seeking to build new franchised units | EXCERPTS ON THIS PAGE:
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