Wendy's Co 8-K, filed Nov 5, 2026
Wendy's Co (WEN)
About this 8-K
Wendy's Co filed this 8-K on November 5, 2026, reporting on events of November 4, 2026.
The Wendy’s Company adopted a stockholder rights plan and rejected an unsolicited, non-binding $7.35-per-share acquisition proposal from Trian and Flynn Group LP, BlueFive Capital and Sixth Street Partners. AI summary
Items reported
- Item 1.01: Entered into a material agreement
- Item 3.03: Change to shareholders' rights
- Item 5.02: Director or officer change, or executive pay
- Item 5.03: Charter or bylaw amendment, or fiscal year change
- Item 7.01: Regulation FD disclosure
- Item 9.01: Financial statements and exhibits
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
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| ITEM 1.01. | ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT. |
On November 4, 2026, the Board of Directors (the “Board”) (excluding the directors affiliated with Trian Fund Management, L.P. (“Trian”)) of The Wendy’s Company (the “Company”) adopted a stockholder rights plan, as set forth in a Rights Agreement (the “Rights Agreement”), dated as of November 4, 2026, between the Company and Equiniti Trust Company, LLC, as rights agent (the “Rights Agent”), and authorized and declared a dividend of one preferred share purchase right (a “Right”) for each outstanding share of common stock, $0.10 par value per share, of the Company (the “Common Shares”) to stockholders of record at the close of business on November 16, 2026 (the “Record Date”). Except as set forth below, each Right, if it becomes exercisable, entitles the registered holder thereof to purchase from the Company one one-thousandth of a share of Series A Junior Participating Preferred Stock, $0.10 par value per share, of the Company (the “Preferred Shares”) at a purchase price of $37.00 per one one-thousandth of a Preferred Share (the “Purchase Price”), subject to adjustment as provided in the Rights Agreement. In addition, one Right will automatically attach to each Common Share that becomes outstanding between the Record Date and the earliest of the Distribution Date (as hereinafter defined), the redemption of the Rights or the expiration of the Rights. The complete terms of the Rights are set forth in the Rights Agreement.
The Board adopted the Rights Agreement in response to the unsolicited, non-binding proposal made on October 28, 2026 by Trian and Flynn Group LP, BlueFive Capital and Sixth Street Partners (together, the “Investor Group”), to acquire all of the Common Shares not currently owned by the Investor Group for $7.35 per Common Share. The Rights Agreement is intended to reduce the likelihood that any person or group gains actual or negative control of the Company without paying all stockholders an appropriate premium for that control, and to ensure that all stockholders receive fair and equal treatment in the event of any proposed takeover of the Company. It is also intended to afford the Board and the previously constituted committee of independent directors of the Board (the “Committee”) sufficient time and opportunity to make informed judgments and take actions that are in the best interests of the Company and its stockholders. The Rights Agreement applies equally to all current and future stockholders and is not intended to deter offers or preclude the Board from considering offers that are fair and otherwise in the best interest of the Company and its stockholders. In adopting the Rights Agreement, the Board also considered, among other things, that the Investor Group rejected an offer from the Company to enter into a customary standstill agreement.
Generally, the Rights Agreement works by imposing significant dilution upon any person or group that acquires fifteen percent (15%) or more of the Common Shares (including in economic exposure through certain derivatives contracts as described in the Rights Agreement) without the approval of the Board or the Committee (such person, an “Acquiring Person”). As a result, the overall effect of the Rights Agreement and the issuance of the Rights may be to render more difficult or discourage a merger, tender or exchange offer or other business combination involving the Company that is not approved by the Board. The Rights Agreement is not intended to interfere with any merger, tender or exchange offer or other business combination approved by the Board.
The following description of the terms of the Rights Agreement (which includes as exhibits thereto the Form of Certificate of Designations and the Form of Right Certificate) does not purport to be complete and is qualified in its entirety by reference to the detailed terms and conditions set forth in the Rights Agreement, a copy of which is filed herewith as Exhibit 4.1 and incorporated herein by reference.
The Rights
Initially, the Rights will be evidenced by the certificates representing Common Shares then outstanding (or, in the case of Common Shares held in uncertificated form, by the transaction statement or other record of ownership of such Common Shares), and no separate Right Certificates (as defined below) will be distributed. Upon the occurrence of the Distribution Date, the Rights will separate from the Common Shares and, as soon as practicable thereafter, separate certificates evidencing the Rights (“Right Certificates”) will be mailed to holders of record of the Common Shares as of the close of business on the Distribution Date, and such separate Right Certificates alone will evidence the Rights. The “Distribution Date” is the earlier of (i) the close of business on the 10th day after the first date of public announcement that any person has become an Acquiring Person (such date, the “Shares Acquisition Date”) (or, if the 10th day after the Shares Acquisition Date occurs before the Record Date, the close of business on the Record Date) and (ii) the close of business on the 10th day (or such later date as the Board shall determine, prior to such time as any person becomes an Acquiring Person) after the date that a tender or exchange offer by any person is first published, sent or given, if, upon consummation thereof, such person would become an Acquiring Person.
Until the earliest of the Distribution Date, the date that the Rights are redeemed by the Board and the date on which the Rights expire, (i) in the case of certificated Common Shares, the Rights associated with the Common Shares represented by any certificate will be evidenced by such certificate and the surrender for transfer of any such certificate
shall also constitute the transfer of the Rights associated with the Common Shares represented thereby, and (ii) in the case of Common Shares held in uncertificated form, the Rights associated with the Common Shares shall be evidenced by the balances indicated in the book-entry account system of the transfer agent for such shares and the transfer of any Common Share in the book-entry account system of the transfer agent for such shares shall also constitute the transfer of the Rights associated with such shares. Therefore, until the Distribution Date, the Rights may be transferred with and only with the underlying Common Shares of the Company. After that date, the Rights may be transferred only on the registry book of the Rights Agent. Any Rights held by an Acquiring Person will become null and void and may not be exercised.
Until a Right is exercised, the holder thereof, as such, will have no rights as a stockholder of the Company, including, without limitation, the right to vote or to receive dividends.
“Grandfathering” of Existing Holders
The Rights Agreement also provides that any person who beneficially owned 15% or more of the Common Shares (including in economic exposure through certain derivatives contracts as described in the Rights Agreement) immediately prior to the first public announcement by the Company of the adoption of the Rights Agreement (each, a “Grandfathered Stockholder”) shall not be deemed to be an “Acquiring Person” for purposes of the Rights Agreement unless and until a Grandfathered Stockholder becomes the beneficial owner of additional Common Shares (including in economic exposure through certain derivatives contracts as described in the Rights Agreement) after the first public announcement by the Company of the adoption of the Rights Agreement unless, upon such acquisition of beneficial ownership of additional Common Shares, such person is not the beneficial owner of 15% or more of the Common Shares then outstanding. In addition, upon the first decrease of a Grandfathered Stockholder’s beneficial ownership below 15%, such Grandfathered Stockholder will no longer be deemed to be a Grandfathered Stockholder.
Exercisability
The Rights are not exercisable until the Distribution Date.
Flip In. In the event that any person or group becomes an Acquiring Person, all holders of Rights (not including the Rights of the Acquiring Person, which will have become null and void) may, for the Purchase Price, purchase Common Shares (or, in certain circumstances, a combination of Common Shares and Preferred Shares) with a then-current market value of twice the Purchase Price, based on the market value of the Common Shares.
Flip Over. In the event that, at any time after a person or group has become an Acquiring Person, (i) the Company or its subsidiaries are party to a merger with another company in which the Common Shares are converted into other securities, cash or property, or (ii) the Company sells or otherwise transfers 50% or more of the assets or earning power of the Company and its subsidiaries (taken as a whole) to another company, all holders of Rights (not including the Rights of the Acquiring Person, which will have become null and void) may, for the Purchase Price, purchase shares of common stock of such other company with a then-current market value of twice the Purchase Price, based on the market price of such common stock prior to such merger or sale.
Expiration
The Rights will expire at the close of business on November 3, 2027, unless earlier redeemed or exchanged by the Company as described below.
Exchange
After a person or group becomes an Acquiring Person, but before an Acquiring Person owns 50% or more of the outstanding Common Shares, the Board may extinguish the Rights by exchanging one Common Share (or, in certain circumstances, Preferred Shares or a combination of Common Shares and Preferred Shares) for each Right (not including the Rights of the Acquiring Person, which will have become null and void).
Anti-Dilution Provisions
The Board may adjust the Purchase Price, the number of Preferred Shares issuable and the number of outstanding Rights to prevent dilution that may occur from a stock dividend, a stock split, or a reclassification of the Preferred Shares or Common Shares. No adjustments to the Purchase Price of less than 1% will be made.
Preferred Share Provisions
Preferred Shares purchasable upon exercise of the Rights will not be redeemable. Each Preferred Share will entitle holders, in preference to the holders of Common Shares, to receive, when and if declared, quarterly dividends in an amount per share equal to the greater of (i) $0.10 and (ii) subject to adjustment, 1,000 times the aggregate per share dividend amount declared on the Common Shares. In the event of liquidation, the holders of the Preferred Shares will be entitled to a preferential liquidation payment equal to the greater of (x) $1,000 per Preferred Share (plus an amount equal to accrued and unpaid dividends and distributions thereon) and (y) an aggregate amount per Preferred Share subject to certain adjustments equal to 1,000 times the aggregate amount to be distributed per share to the holders of the Common Shares. Finally, in the event of any merger, consolidation or other transaction in which Common Shares are exchanged, each thousandth of a Preferred Share will be entitled to receive (subject to certain adjustments) the amount received per Common Share. These rights are protected by customary anti-dilution provisions.
No fractional Preferred Shares will be issued other than fractions which are integral multiples of one one-thousandth of a Preferred Share (which may, at the election of the Company, be evidenced by depositary receipts), but, in lieu thereof, an adjustment in cash will be made based on the closing price of the Preferred Shares on the last trading day prior to the date of exercise.
Redemption
The Board may, at its option, at any time prior to such time as any person or group becomes an Acquiring Person, cause the Company to redeem all but not less than all the then outstanding Rights at a redemption price of $0.001 per Right, subject to adjustment (the “Redemption Price”). Immediately upon the action of the Board ordering redemption of the Rights, the Rights will terminate and the only right of the holders of Rights will be to receive the Redemption Price.
Amendments
The Company may from time to time supplement or amend the Rights Agreement without the approval of any holders of Right Certificates in order to, among other things, make any provisions with respect to the Rights, the Rights Agreement or otherwise, which the Company may deem necessary or desirable; provided, however, that from and after such time as any person or group becomes an Acquiring Person, the Rights Agreement may not be amended in any manner which would adversely affect the interests of the holders of Rights.
| ITEM 3.03. | MATERIAL MODIFICATION TO RIGHTS OF SECURITY HOLDERS. |
The information contained in Item 1.01 of this Current Report on Form 8-K is incorporated herein by reference.
| ITEM 5.02. | DEPARTURE OF DIRECTORS OR CERTAIN OFFICERS; ELECTION OF DIRECTORS; APPOINTMENT OF CERTAIN OFFICERS; COMPENSATORY ARRANGEMENTS OF CERTAIN OFFICERS. |
In addition, at a meeting of the Board held on November 4, 2026, to which all non-employee directors of the Board were invited, and which was attended by a quorum of the Board, including members of the Board constituting a quorum of the Compensation and Human Capital Committee of the Board (the “CHC Committee”) and a quorum of the Performance Compensation Subcommittee of the CHC Committee, the Board, in consultation with the independent outside compensation consultant of the CHC Committee, approved amendments to the Company’s 2010 Omnibus Award Plan (as amended, the “2010 Plan”), the Company’s 2020 Omnibus Award Plan (as amended, the “2020 Plan” and, together with the 2010 Plan, the “Omnibus Plans”), outstanding equity-based awards granted under the 2020 Plan (including those held by the Company’s executive officers) and the Wendy’s International, LLC Executive Severance Pay Policy (as amended, the “Severance Policy”, and collectively, the “Amendments”).
The Amendments reflect the following changes:
| • | update the definition of “Change in Control” under the Omnibus Plans to eliminate the exclusion for specified corporate transactions involving Nelson Peltz, Peter W. May or any person controlled by either of them; |
| • | provide that, in the event of a Change in Control, outstanding performance units will convert into a number of restricted stock units based on deemed achievement of applicable performance conditions at the following levels (i) for each performance goal other than relative total shareholder return, (A) actual performance for each period over which performance is measured under the applicable award agreement that is completed before the Change in Control and (B) for any period that has not been completed as of the Change in Control, the greater of actual performance through the date of the Change in Control and target performance, and (ii) for relative total shareholder return (whether as a performance goal or a performance modifier), actual performance through the date of the Change in Control (or, if earlier, the end of the applicable performance period) and, if such restricted stock units remain outstanding after a Change in Control and the holder thereof has a termination of employment by the Company without Cause or due to a resignation by the holder thereof with Good Reason (each, as defined in the 2020 Plan) prior to the end of applicable performance period, all such restricted stock units shall accelerate vesting in full; |
| • | provide that, for purposes of the 2020 Plan and the Severance Policy, the duration of the protection period following a Change in Control during which special vesting rules apply in the event of a termination of employment by the Company without Cause or a resignation with Good Reason, is 18 months; and |
| • | clarify that, for purposes of the 2020 Plan and the Severance Policy, a resignation of employment with Good Reason (as defined in the 2020 Plan) within 18 months following a Change in Control will be treated like a termination of employment by the Company without Cause for purposes of severance (including salary continuation and annual cash incentive payments and benefits) and treatment of equity-based awards. |
The descriptions of the Amendments herein do not purport to be complete and are subject to, and qualified in their entirety by, the full text of the Amendments to the 2010 Plan, 2020 Plan, relevant award agreements and Severance Policy, as applicable, each of which is filed herewith and incorporated herein by reference.
| ITEM 5.03. | AMENDMENTS TO ARTICLES OF INCORPORATION OR BYLAWS; CHANGE IN FISCAL YEAR. |
In connection with the adoption of the Rights Agreement referenced in Item 1.01, the Board approved a Certificate of Designations of Series A Junior Participating Preferred Stock of the Company (the “Certificate of Designations”). The Certificate of Designations will be filed with the Secretary of State of the State of Delaware on November 5, 2026. The Certificate of Designations sets forth the rights, powers and preferences of the Preferred Shares.
The summary of the rights, powers and preferences of the Preferred Shares set forth in Item 1.01 of this Current Report on Form 8-K is incorporated herein by reference. A copy of the Certificate of Designations is filed herewith as Exhibit 3.1 and incorporated herein by reference.
| ITEM 7.01. | REGULATION FD DISCLOSURE. |
On November 5, 2026, the Company issued a press release (the “Rights Agreement Press Release”) announcing the adoption of the Rights Agreement and declaration of a dividend of the Rights and the Board’s rejection of an unsolicited, non-binding proposal from the Investor Group to acquire all of the outstanding Common Shares not currently owned by the Investor Group for $7.35 per share in cash. A copy of the Rights Agreement Press Release is included as Exhibit 99.1 to this Current Report on Form 8-K and is incorporated herein by reference.
The information furnished in this Item 7.01, including Exhibit 99.1, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section, nor shall such information be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, regardless of any general incorporation language in such filing, except as shall be expressly set forth by specific reference in such filing.
| ITEM 9.01. | FINANCIAL STATEMENTS AND EXHIBITS. |
| (d) | Exhibits. |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
Date: November 5, 2026
| THE WENDY’S COMPANY | ||
| By: | /s/ Mark L. Johnson | |
| Name: | Mark L. Johnson | |
| Title: | Director - Corporate & Securities Counsel, and Assistant Secretary | |
Exhibit 3.1
CERTIFICATE OF DESIGNATIONS
of
SERIES A JUNIOR PARTICIPATING PREFERRED STOCK
of
THE WENDY’S COMPANY
(Pursuant to Section 151 of the
Delaware General Corporation Law)
The Wendy’s Company, a corporation organized and existing under the General Corporation Law of the State of Delaware (hereinafter called the “Corporation”), hereby certifies that the following resolution was adopted by the Board of Directors of the Corporation as required by Section 151 of the General Corporation Law at a meeting duly called and held on November 4, 2026:
RESOLVED, that pursuant to the authority granted to and vested in the Board of Directors of this Corporation (hereinafter called the “Board of Directors” or the “Board”) in accordance with the provisions of the Amended and Restated Certificate of Incorporation of the Corporation, the Board of Directors hereby fixes the relative rights, preferences, and limitations of a series of preferred stock, par value $0.10 per share (the “Preferred Stock”) as follows:
Series A Junior Participating Preferred Stock:
Section 1. Designation and Amount. The shares of such series shall be designated as “Series A Junior Participating Preferred Stock”, par value $0.10 per share (the “Series A Preferred Stock”), and the number of shares constituting the Series A Preferred Stock shall be 200,000. Such number of shares may be increased or decreased by resolution of the Board of Directors; provided, that no decrease shall reduce the number of shares of Series A Preferred Stock to a number less than the number of shares then outstanding plus the number of shares reserved for issuance upon the exercise of outstanding options, rights or warrants or upon the conversion of any outstanding securities issued by the Corporation convertible into Series A Preferred Stock.
Section 2. Dividends and Distributions.
(A) Subject to the rights of the holders of any shares of any series of Preferred Stock (or any similar stock) ranking prior and superior to the Series A Preferred Stock with respect to dividends, the holders of shares of Series A Preferred Stock, in preference to the holders of Common Stock, par value $0.10 per share (the “Common Stock”), of the Corporation, and of any other junior stock, shall be entitled to receive, when, as and if declared by the Board of Directors out of funds legally available for the purpose, quarterly dividends payable in cash on the first day of March, June, September and December in each year (each such date being referred to herein as a “Quarterly Dividend Payment Date”), commencing on the first Quarterly Dividend Payment Date after the first issuance of a share or fraction of a share of Series A Preferred Stock, in an amount per share (rounded to the nearest cent) equal to the greater of (a) $0.10 or (b) subject to the provision for adjustment hereinafter set forth, 1,000 times the aggregate per share amount of all cash dividends, and 1,000 times the aggregate per share amount (payable in kind) of all non-cash dividends or other distributions, other than a dividend payable in shares of Common Stock or a subdivision of the outstanding shares of Common Stock (by reclassification or otherwise), declared on the Common Stock since the immediately preceding Quarterly Dividend Payment Date or, with respect to the first Quarterly Dividend Payment Date, since the first issuance of any share or fraction of a share of Series A Preferred Stock. In the event the Corporation shall at any time declare or pay any dividend on the Common Stock payable in shares of Common Stock, or effect a subdivision or combination or consolidation of the outstanding shares of Common Stock (by reclassification or otherwise than by payment of a dividend in shares of Common Stock) into a greater or lesser number of shares of Common Stock, then in each such case the amount to which holders of shares of Series A Preferred Stock were entitled immediately prior to such event under clause (b) of the preceding sentence shall be adjusted by multiplying such amount by a fraction, the numerator of which is the number of shares of Common Stock outstanding immediately after such event and the denominator of which is the number of shares of Common Stock that were outstanding immediately prior to such event.
(B) The Corporation shall declare a dividend or distribution on the Series A Preferred Stock as provided in paragraph (A) of this Section immediately after it declares a dividend or distribution on the Common Stock (other than a dividend payable in shares of Common Stock); provided that, in the event no dividend or distribution shall have been declared on the Common Stock during the period between any Quarterly Dividend Payment Date and the next subsequent Quarterly Dividend Payment Date, a dividend of $0.10 per share on the Series A Preferred Stock shall nevertheless be payable on such subsequent Quarterly Dividend Payment Date.
(C) Dividends shall begin to accrue and be cumulative on outstanding shares of Series A Preferred Stock from the Quarterly Dividend Payment Date next preceding the date of issue of such shares, unless the date of issue of such shares is prior to the record date for the first Quarterly Dividend Payment Date, in which case dividends on such shares shall begin to accrue from the date of issue of such shares, or unless the date of issue is a Quarterly Dividend Payment Date or is a date after the record date for the determination of holders of shares of Series A Preferred Stock entitled to receive a quarterly dividend and before such Quarterly Dividend Payment Date, in either of which events such dividends shall begin to accrue and be cumulative from such Quarterly Dividend Payment Date. Accrued but unpaid dividends shall not bear interest.
(D) Dividends paid on the shares of Series A Preferred Stock in an amount less than the total amount of such dividends at the time accrued and payable on such shares shall be allocated pro rata on a share-by-share basis among all such shares at the time outstanding. The Board of Directors may fix a record date for the determination of holders of shares of Series A Preferred Stock entitled to receive payment of a dividend or distribution declared thereon, which record date shall be not more than 60 days prior to the date fixed for the payment thereof.
Section 3. Voting Rights. The holders of shares of Series A Preferred Stock shall have the following voting rights:
(A) Subject to the provision for adjustment hereinafter set forth, each share of Series A Preferred Stock shall entitle the holder thereof to 1,000 votes on all matters submitted to a vote of the stockholders of the Corporation. In the event the Corporation shall at any time declare or pay any dividend on the Common Stock payable in shares of Common Stock, or effect a subdivision or combination or consolidation of the outstanding shares of Common Stock (by reclassification or otherwise than by payment of a dividend in shares of Common Stock) into a greater or lesser number of shares of Common Stock, then in each such case the number of votes per share to which holders of shares of Series A Preferred Stock were entitled immediately prior to such event shall be adjusted by multiplying such number by a fraction, the numerator of which is the number of shares of Common Stock outstanding immediately after such event and the denominator of which is the number of shares of Common Stock that were outstanding immediately prior to such event.
(B) Except as otherwise provided herein, in any other Certificate of Designations creating a series of Preferred Stock or any similar stock, or by law, the holders of shares of Series A Preferred Stock and the holders of shares of Common Stock and any other capital stock of the Corporation having general voting rights shall vote together as one class on all matters submitted to a vote of stockholders of the Corporation.
(C) Except as set forth herein, or as otherwise provided by law, holders of Series A Preferred Stock shall have no special voting rights and their consent shall not be required (except to the extent they are entitled to vote with holders of Common Stock as set forth herein) for taking any corporate action.
Section 4. Certain Restrictions.
(A) Whenever quarterly dividends or other dividends or distributions payable on the Series A Preferred Stock as provided in Section 2 are in arrears, thereafter and until all accrued and unpaid dividends and distributions, whether or not declared, on shares of Series A Preferred Stock outstanding shall have been paid in full, the Corporation shall not:
(i) declare or pay dividends, or make any other distributions, on any shares of stock ranking junior (either as to dividends or upon liquidation, dissolution or winding up) to the Series A Preferred Stock;
(ii) declare or pay dividends, or make any other distributions, on any shares of stock ranking on a parity (either as to dividends or upon liquidation, dissolution or winding up) with the Series A Preferred Stock, except dividends paid ratably on the Series A Preferred Stock and all such parity stock on which dividends are payable or in arrears in proportion to the total amounts to which the holders of all such shares are then entitled;
(iii) redeem or purchase or otherwise acquire for consideration shares of any stock ranking junior (either as to dividends or upon liquidation, dissolution or winding up) to the Series A Preferred Stock, provided that the Corporation may at any time redeem, purchase or otherwise acquire shares of any such junior stock in exchange for shares of any stock of the Corporation ranking junior (either as to dividends or upon dissolution, liquidation or winding up) to the Series A Preferred Stock; or
(iv) redeem or purchase or otherwise acquire for consideration any shares of Series A Preferred Stock, or any shares of stock ranking on a parity with the Series A Preferred Stock, except in accordance with a purchase offer made in writing or by publication (as determined by the Board of Directors) to all holders of such shares upon such terms as the Board of Directors, after consideration of the respective annual dividend rates and other relative rights and preferences of the respective series and classes, shall determine will result in fair and equitable treatment among the respective series or classes.
(B) The Corporation shall not permit any subsidiary of the Corporation to purchase or otherwise acquire for consideration any shares of stock of the Corporation unless the Corporation could, under paragraph (A) of this Section 4, purchase or otherwise acquire such shares at such time and in such manner.
Section 5. Reacquired Shares. Any shares of Series A Preferred Stock purchased or otherwise acquired by the Corporation in any manner whatsoever shall be retired and cancelled promptly after the acquisition thereof. All such shares shall upon their cancellation become authorized but unissued shares of Preferred Stock and may be reissued as part of a new series of Preferred Stock subject to the conditions and restrictions on issuance set forth herein, in the Amended and Restated Certificate of Incorporation of the Corporation, or in any other Certificate of Designations creating a series of Preferred Stock or any similar stock or as otherwise required by law.
Section 6. Liquidation, Dissolution or Winding Up. Upon any liquidation, dissolution or winding up of the Corporation, no distribution shall be made (A) to the holders of shares of stock ranking junior (either as to dividends or upon liquidation, dissolution or winding up) to the Series A Preferred Stock unless, prior thereto, the holders of shares of Series A Preferred Stock shall have received the greater of (a) $1,000 per share, plus an amount equal to accrued and unpaid dividends and distributions thereon, whether or not declared, to the date of such payment, or (b) an aggregate amount per share, subject to the provision for adjustment hereinafter set forth, equal to 1,000 times the aggregate amount to be distributed per share to holders of shares of Common Stock, or (B) to the holders of shares of stock ranking on a parity (either as to dividends or upon liquidation, dissolution or winding up) with the Series A Preferred Stock, except distributions made ratably on the Series A Preferred Stock and all such parity stock in proportion to the total amounts to which the holders of all such shares are entitled upon such liquidation, dissolution or winding up. In the event the Corporation shall at any time declare or pay any dividend on the Common Stock payable in shares of Common Stock, or effect a subdivision or combination or consolidation of the outstanding shares of Common Stock (by reclassification or otherwise than by payment of a dividend in shares of Common Stock) into a greater or lesser number of shares of Common Stock, then in each such case the aggregate amount to which holders of shares of Series A Preferred Stock were entitled immediately prior to such event under the
proviso in clause (A) of the preceding sentence shall be adjusted by multiplying such amount by a fraction the numerator of which is the number of shares of Common Stock outstanding immediately after such event and the denominator of which is the number of shares of Common Stock that were outstanding immediately prior to such event.
Section 7. Consolidation, Merger, etc. In case the Corporation shall enter into any consolidation, merger, combination or other transaction in which the shares of Common Stock are exchanged for or changed into other stock or securities, cash and/or any other property, then in any such case each share of Series A Preferred Stock shall at the same time be similarly exchanged or changed into an amount per share, subject to the provision for adjustment hereinafter set forth, equal to 1,000 times the aggregate amount of stock, securities, cash and/or any other property (payable in kind), as the case may be, into which or for which each share of Common Stock is changed or exchanged. In the event the Corporation shall at any time declare or pay any dividend on the Common Stock payable in shares of Common Stock, or effect a subdivision or combination or consolidation of the outstanding shares of Common Stock (by reclassification or otherwise than by payment of a dividend in shares of Common Stock) into a greater or lesser number of shares of Common Stock, then in each such case the amount set forth in the preceding sentence with respect to the exchange or change of shares of Series A Preferred Stock shall be adjusted by multiplying such amount by a fraction, the numerator of which is the number of shares of Common Stock outstanding immediately after such event and the denominator of which is the number of shares of Common Stock that were outstanding immediately prior to such event.
Section 8. No Redemption. The shares of Series A Preferred Stock shall not be redeemable.
Section 9. Rank. The Series A Preferred Stock shall rank, with respect to the payment of dividends and the distribution of assets, junior to all series of any other class of the Corporation’s Preferred Stock.
Section 10. Amendment. The Amended and Restated Certificate of Incorporation of the Corporation shall not be amended in any manner which would materially alter or change the powers, preferences or special rights of the Series A Preferred Stock so as to affect them adversely without the affirmative vote of the holders of at least two-thirds of the outstanding shares of Series A Preferred Stock, voting together as a single class.
IN WITNESS WHEREOF, the Corporation has caused this Certificate of Designations to be signed and acknowledged by the undersigned this 5th day of November, 2026.
| /s/ John Min |
| Name: John Min Title: Chief Legal Officer and Secretary |
Exhibit 4.1
THE WENDY’S COMPANY
and
EQUINITI TRUST COMPANY, LLC,
as Rights Agent
Rights Agreement
Dated as of November 4, 2026
TABLE OF CONTENTS
| Page | ||||||
| Section 1. |
Definitions |
1 | ||||
| Section 2. |
Appointment of Rights Agent |
8 | ||||
| Section 3. |
Issue of Right Certificates |
8 | ||||
| Section 4. |
Form of Right Certificates |
10 | ||||
| Section 5. |
Countersignature and Registration |
11 | ||||
| Section 6. |
Transfer, Split Up, Combination and Exchange of Right Certificates; Mutilated, Destroyed, Lost or Stolen Right Certificates |
11 | ||||
| Section 7. |
Exercise of Rights; Purchase Price; Expiration Date of Rights |
13 | ||||
| Section 8. |
Cancellation and Destruction of Right Certificates |
14 | ||||
| Section 9. |
Availability of Preferred Shares |
14 | ||||
| Section 10. |
Preferred Shares Record Date |
15 | ||||
| Section 11. |
Adjustment of Purchase Price, Number of Shares or Number of Rights |
15 | ||||
| Section 12. |
Certificate of Adjusted Purchase Price or Number of Shares |
21 | ||||
| Section 13. |
Consolidation, Merger or Sale or Transfer of Assets or Earning Power |
22 | ||||
| Section 14. |
Fractional Rights and Fractional Shares |
23 | ||||
| Section 15. |
Rights of Action |
24 | ||||
| Section 16. |
Agreement of Right Holders |
25 | ||||
| Section 17. |
Right Certificate Holder Not Deemed a Stockholder |
25 | ||||
| Section 18. |
Concerning the Rights Agent |
26 | ||||
| Section 19. |
Merger or Consolidation or Change of Name of Rights Agent |
26 | ||||
| Section 20. |
Rights and Duties of Rights Agent |
27 | ||||
| Section 21. |
Change of Rights Agent |
30 | ||||
| Section 22. |
Issuance of New Right Certificates |
31 | ||||
| Section 23. |
Redemption |
31 | ||||
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| Section 24. |
Exchange |
32 | ||||
| Section 25. |
Notice of Certain Events |
33 | ||||
| Section 26. |
Notices |
34 | ||||
| Section 27. |
Supplements and Amendments |
35 | ||||
| Section 28. |
Successors |
35 | ||||
| Section 29. |
Benefits of this Agreement |
35 | ||||
| Section 30. |
Determinations and Actions by the Board of Directors |
36 | ||||
| Section 31. |
Severability |
36 | ||||
| Section 32. |
Governing Law |
36 | ||||
| Section 33. |
Counterparts |
36 | ||||
| Section 34. |
Descriptive Headings; Interpretation |
36 | ||||
| Section 35. |
Force Majeure |
36 | ||||
| Section 36. |
Customer Identification Program |
36 | ||||
Exhibit A - Form of Certificate of Designations
Exhibit B - Form of Right Certificate
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RIGHTS AGREEMENT, dated as of November 4, 2026 (as amended, supplemented or otherwise modified from time to time, the “Agreement”), between The Wendy’s Company, a Delaware corporation (the “Company”), and Equiniti Trust Company, LLC, a New York limited liability trust company, as rights agent (the “Rights Agent”).
The Board of Directors of the Company has authorized the issuance and declared a dividend of one preferred share purchase right (a “Right”) for each Common Share (as hereinafter defined) of the Company outstanding on November 16, 2026 (the “Record Date”), each Right representing the right to purchase one one-thousandth of a Preferred Share (as hereinafter defined), upon the terms and subject to the conditions set forth herein, and has further authorized and directed the issuance of one Right with respect to each Common Share that shall become outstanding between the Record Date and the earliest of the Distribution Date, the Redemption Date and the Final Expiration Date (as such terms are hereinafter defined).
Accordingly, in consideration of the premises and the mutual agreements herein set forth, the parties hereby agree as follows:
Section 1. Definitions. For purposes of this Agreement, the following terms have the meanings indicated:
(a) “Acquiring Person” shall mean any Person (other than a Grandfathered Stockholder who has not been deemed an Acquiring Person pursuant to the definition thereof) who or which, together with all Affiliates and Associates of such Person, shall be the Beneficial Owner of 15% or more of the Common Shares of the Company then outstanding, but shall not include the Company, any Subsidiary of the Company, any employee benefit plan of the Company or of any Subsidiary of the Company, or any entity holding Common Shares of the Company for or pursuant to the terms of any such employee benefit plan. Notwithstanding the foregoing, no Person shall become an Acquiring Person as the result of (i) an acquisition of Common Shares of the Company by the Company which, by reducing the number of Common Shares of the Company outstanding, increases the proportionate number of Common Shares of the Company Beneficially Owned by such Person to 15% or more of the Common Shares of the Company then outstanding or (ii) the grant or issuance of Common Shares of the Company (or options, warrants, rights or similar interests to acquire Common Shares of the Company) by the Company to directors, officers, employees or other service providers of the Company or any Subsidiary of the Company pursuant to any stock incentive plan, employee benefit plan, stock option plan, stock ownership plan or any other compensatory plan or arrangement of the Company or any Subsidiary of the Company approved by the Board, which increases the proportionate number of Common Shares of the Company Beneficially Owned by such Person to 15% or more of the Common Shares of the Company then outstanding; provided, however, that, if a Person, together with all Affiliates and Associates of such Person, shall become the Beneficial Owner of 15% or more of the Common Shares of the Company then outstanding by reason of share purchases by the Company and shall, after such share purchases by the Company, become the Beneficial Owner, together with all Affiliates and Associates of such Person, of any additional Common Shares of the Company (other than pursuant to a dividend or distribution paid or made by the Company on the outstanding Common Shares of the Company or pursuant to a split or subdivision of the outstanding Common Shares of the Company), then such Person shall be deemed to be an Acquiring Person. Notwithstanding the foregoing, if the Board of Directors of the Company, with the concurrence of
a majority of the members of the Board of Directors who are not, and are not representatives, nominees, Affiliates or Associates of, such Person or an Acquiring Person, determines that a Person who or which would otherwise be an Acquiring Person, as defined pursuant to the foregoing provisions of this paragraph (a), has become such inadvertently (including, without limitation, because such Person was unaware that it Beneficially Owned a percentage of the Common Shares of the Company that would otherwise cause such Person to be an Acquiring Person or such Person was aware of the extent of the Common Shares of the Company that it Beneficially Owned but had no actual knowledge of the consequences of such Beneficial Ownership pursuant to this Agreement), and such Person divests as promptly as practicable (as determined by the Board of Directors of the Company) a sufficient number of Common Shares of the Company (or, in the case solely of Derivative Common Shares of the Company, such Person terminates the subject Derivatives Contract or disposes of the subject derivative security or securities with respect to a sufficient number of Derivative Common Shares of the Company) so that such Person would no longer be an Acquiring Person, as defined pursuant to the foregoing provisions of this paragraph (a), then such Person shall not be deemed to be, and shall be deemed to have not ever become, an Acquiring Person for any purposes of this Agreement. The Company shall provide prompt written notice to the Rights Agent of a determination by the Board of Directors under the preceding sentence. Notwithstanding the foregoing, if a bona fide swaps dealer who would otherwise be an Acquiring Person has become so as a result of its actions in the ordinary course of its business that the Board of Directors of the Company determines, in its sole discretion, were taken without the intent or effect of evading, or assisting any other Person to evade, the purposes and intent of this Agreement, or otherwise seeking to control or influence the management or policies of the Company, then, and unless and until the Board of Directors of the Company shall otherwise determine, such Person shall not be deemed to be an Acquiring Person for any purposes of this Agreement.
(b) “Adjustment Shares” shall have the meaning set forth in Section 11(a)(ii) hereof.
(c) “Affiliate” shall have the meaning ascribed to such term in Rule 12b-2 of the General Rules and Regulations under the Exchange Act (as hereinafter defined) as in effect on the date of this Agreement.
(d) “Agreement” shall have the meaning set forth in the first paragraph hereof.
(e) “Associate” shall have the meaning ascribed to such term in Rule 12b-2 of the General Rules and Regulations under the Exchange Act as in effect on the date of this Agreement.
(f) A Person shall be deemed the “Beneficial Owner” of, shall be deemed to have “Beneficial Ownership” of, and shall be deemed to “Beneficially Own,” any securities:
(i) which such Person or any of such Person’s Affiliates or Associates beneficially owns, directly or indirectly, within the meaning of Rule 13d-3 and Rule 13d-5 of the General Rules and Regulations under the Exchange Act as in effect on the date of this Agreement;
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(ii) which such Person or any of such Person’s Affiliates or Associates has, directly or indirectly, (A) the right or the obligation to acquire (whether such right is exercisable, or such obligation is required to be performed, immediately or only after the passage of time) pursuant to any agreement, arrangement or understanding (other than customary agreements with and between underwriters and selling group members with respect to a bona fide public offering of securities), written or otherwise, or upon the exercise of conversion rights, exchange rights, rights (other than the Rights), warrants or options, or otherwise; provided, however, that a Person shall not be deemed the Beneficial Owner of, or to Beneficially Own, securities tendered pursuant to a tender or exchange offer made by or on behalf of such Person or any of such Person’s Affiliates or Associates until such tendered securities are accepted for purchase or exchange; or (B) the right to vote pursuant to any agreement, arrangement or understanding, written or otherwise; provided, however, that a Person shall not be deemed the Beneficial Owner of, or to Beneficially Own, any security if the agreement, arrangement or understanding to vote such security (1) arises solely from a revocable proxy or consent given to such Person in response to a public proxy or consent solicitation made pursuant to, and in accordance with, the applicable rules and regulations promulgated under the Exchange Act, (2) is not also then reportable on Schedule 13D under the Exchange Act (or any comparable or successor report), and (3) does not constitute a trust, proxy, power of attorney or other device with the purpose or effect of allowing two or more persons, acting in concert, to avoid being deemed Beneficial Owners of such security or otherwise avoid the status of “Acquiring Person” under the terms of this Agreement or as part of a plan or scheme to evade the reporting requirements under Schedule 13D or Sections 13(d) or 13(g) of the Exchange Act; or (C) investment power, which includes the power to dispose or direct the disposition thereof;
(iii) which are beneficially owned, directly or indirectly, by any other Person with which such Person or any of such Person’s Affiliates or Associates has any agreement, arrangement or understanding (other than customary agreements with and between underwriters and selling group members with respect to a bona fide public offering of securities), whether or not in writing, (A) for the purpose of acquiring, holding, voting (except to the extent contemplated by the proviso to Section 1(f)(ii)(B) hereof) or disposing of any securities of the Company, or (B) to obtain, change or influence control of the Company; or
(iv) which are the subject of, or the reference securities for, or that underlie, any Derivatives Contract to which such Person or any of such Person’s Affiliates or Associates is a Receiving Party, with the number of Common Shares deemed Beneficially Owned in respect of a Derivatives Contract being the notional or other number of Common Shares in respect of such Derivatives Contract (without regard to any short or similar position) that is specified in (i) one or more filings with the Securities and Exchange Commission by such Person or any of such Person’s Affiliates or Associates or (ii) the documentation evidencing such Derivatives Contract as the basis upon which the value or settlement amount in respect of such Derivatives Contract, or the opportunity of the Receiving Party of such Derivatives Contract to profit or share in any profit, is to be calculated in whole or in part (whichever of (i) or (ii) is greater), or if no such number of Common Shares is specified in such filings or documentation (or such documentation is not available to the Board of Directors), as determined by the Board of Directors in its reasonable discretion (such Common Shares deemed Beneficially Owned pursuant to this paragraph, the “Notional Common Shares”).
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Notwithstanding anything in this definition of Beneficial Ownership to the contrary:
(A) The phrase “then outstanding,” when used with reference to a Person’s Beneficial Ownership of securities of the Company, shall mean the number of such securities then issued and outstanding together with the number of such securities not then actually issued and outstanding which are issuable by the Company and which such Person would be deemed to Beneficially Own hereunder.
(B) For purposes of determining whether a Person is an Acquiring Person, the number of Common Shares of the Company that a Person is deemed to Beneficially Own in connection with a particular Derivatives Contract shall equal the number of Notional Common Shares associated with such Derivatives Contract.
(C) Solely for purposes of determining whether a Right is Beneficially Owned by a Person who has become an Acquiring Person (thereby rendering such Right null and void pursuant to Section 11(a)(ii)), an Acquiring Person shall be deemed to Beneficially Own the Common Shares of the Company which are beneficially owned, directly or indirectly, by a Counterparty (or any of such Counterparty’s Affiliates or Associates) under any Derivatives Contract (without regard to any short or similar position under the same or any other Derivatives Contract) to which such Acquiring Person or any of such Acquiring Person’s Affiliates or Associates is a Receiving Party, including without limitation all securities specified or referenced in such Derivatives Contract that are beneficially owned, directly or indirectly, by any other Counterparty (or any of such other Counterparty’s Affiliates or Associates) under any Derivatives Contract to which such first Counterparty (or any of such first Counterparty’s Affiliates or Associates) is a Receiving Party, with this proviso being applied to successive Counterparties as appropriate; provided, however, that (1) the number of Common Shares of the Company that an Acquiring Person is deemed to Beneficially Own pursuant to this clause (C) in connection with a particular Derivatives Contract shall not exceed the number of Notional Common Shares associated with such Derivatives Contract, and (2) the Board may determine in a particular instance that an Acquiring Person shall not be deemed to Beneficially Own securities which were acquired by a Counterparty for purposes other than hedging against its economic exposure under Derivatives Contracts.
(g) “Business Day” shall mean any day other than a Saturday, a Sunday, or a day on which banking institutions in the City of New York, New York, the State of New York, or the state in which the principal office of the Rights Agent is located are authorized or obligated by law or executive order to close.
(h) “Close of Business” on any given date shall mean 5:00 P.M., New York City time, on such date; provided, however, that, if such date is not a Business Day, it shall mean 5:00 P.M., New York City time, on the following Business Day.
(i) “Common Shares” when used with reference to the Company shall mean the shares of common stock, par value $0.10 per share, of the Company. “Common Shares” when used with reference to any Person other than the Company shall mean the capital stock (or the equivalent equity interest) with the greatest voting power of such other Person or, if such other Person is a Subsidiary of another Person, the Person or Persons who or which ultimately control such first-mentioned Person.
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(j) “Company” shall have the meaning set forth in the first paragraph hereof.
(k) “Counterparty” shall have the meaning set forth in Section 1(o) hereof.
(l) “Current Value” shall have the meaning set forth in Section 11(a)(iii) hereof.
(m) “Customer Identification Program” shall have the meaning set forth in Section 36 hereof.
(n) “Derivative Common Shares” shall mean Common Shares that are deemed to be Beneficially Owned pursuant to Section 1(f)(iv)(B) hereof.
(o) “Derivatives Contract” shall mean a contract between two parties that (i) has an exercise or conversion privilege or a settlement payment or mechanism at a price related to the value of the Common Shares or a value determined in whole or in part with reference to, or derived in whole or in part from, the value of the Common Shares and that increases in value as the market price or value of the Common Shares increases or that provides an opportunity, directly or indirectly, to profit or share in any profit derived from any increase in the value of the Common Shares and (ii) is capable of being settled, in whole or in part, through delivery of cash or Common Shares (whether on a required or optional basis, and whether such settlement may occur immediately or only after the passage of time, the occurrence of conditions, the satisfaction of regulatory requirements or otherwise) or is otherwise designed to produce economic benefits and risks for one party (the “Receiving Party”, and the other party, the “Counterparty”) that correspond substantially to the ownership by (or economic exposure of) such Receiving Party of (or to) a number of Notional Common Shares, regardless of (i) whether such contract conveys any voting rights, (ii) whether obligations under such contract are required or permitted to be settled through the delivery of cash, Common Shares or other property, or (iii) any short position under the same or any other Derivatives Contract. Derivatives Contracts shall include, without limitation, any option, warrant, convertible security, stock appreciation right, or other security, contract right or derivative position or similar right. For the avoidance of doubt, interests in broad-based index options, broad-based index futures and broad-based publicly traded market baskets of stocks approved for trading by the appropriate federal governmental authority shall not be deemed to be Derivatives Contracts.
(p) “Distribution Date” shall have the meaning set forth in Section 3(a) hereof.
(q) “equivalent preferred shares” shall have the meaning set forth in Section 11(b) hereof.
(r) “Exchange Act” shall mean the Securities Exchange Act of 1934, as amended.
(s) “Exchange Ratio” shall have the meaning set forth in Section 24(a) hereof.
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(t) “Final Expiration Date” shall have the meaning set forth in Section 7(a) hereof.
(u) “Grandfathered Stockholder” shall mean any Person who or which, together with all Affiliates and Associates of such Person, at the time of the first public announcement of this Agreement, is a Beneficial Owner of 15% or more of the Common Shares of the Company then outstanding; provided, however, that if a Grandfathered Stockholder, together with all Affiliates and Associates of such Grandfathered Stockholder, becomes, after such time, the Beneficial Owner of any additional Common Shares of the Company (other than (i) pursuant to a dividend or distribution paid or made by the Company on the outstanding Common Shares of the Company, (ii) pursuant to a split or subdivision of the outstanding Common Shares of the Company or (iii) as a result of the grant or issuance of Common Shares of the Company (or options, warrants, rights or similar interests to acquire Common Shares of the Company) by the Company to directors, officers, employees or other service providers of the Company or any Subsidiary of the Company pursuant to any stock incentive plan, employee benefit plan, stock option plan, stock ownership plan or any other compensatory plan or arrangement of the Company or any Subsidiary of the Company approved by the Board), regardless of whether, thereafter or as a result thereof, there is an increase, decrease or no change in the percentage of Common Shares of the Company then outstanding Beneficially Owned by such Grandfathered Stockholder, then such Grandfathered Stockholder shall be deemed to be an Acquiring Person; provided, further, that upon the first decrease of a Grandfathered Stockholder’s Beneficial Ownership below 15%, such Grandfathered Stockholder shall cease to be a Grandfathered Stockholder and this definition shall have no further force or effect with respect to such Person.
For the avoidance of doubt, in the event that after the time of the first public announcement of this Agreement, any agreement, arrangement or understanding pursuant to which any Grandfathered Stockholder is deemed to be the Beneficial Owner of Common Shares of the Company is, directly or indirectly, replaced, extended, amended or substituted with respect to the same or different Common Shares for any reason (including, without limitation, because it expired, was settled in whole or in part, terminated or no longer confers any benefit to or imposes any obligation on the Grandfathered Stockholder (or as applicable, an Affiliate or Associate of the Grandfathered Stockholder)), then in such event, such direct or indirect replacement, extension or amendment of, or substitution for, such agreement, arrangement or understanding shall be considered the acquisition of Beneficial Ownership of additional Common Shares by the Grandfathered Stockholder and render such Grandfathered Stockholder an Acquiring Person for purposes of this Agreement unless, upon such acquisition of Beneficial Ownership of additional Common Shares, such Person is not the Beneficial Owner of 15% or more of the Common Shares then outstanding.
(v) “NASDAQ” shall mean The Nasdaq Stock Market LLC.
(w) “Notional Common Shares” shall have the meaning set forth in Section 1(f)(iv) hereof.
(x) “Person” shall mean any individual, partnership, firm, corporation, limited liability company, association, trust, joint venture, unincorporated organization or other entity, and shall include any successor (by merger or otherwise) of such entity, as well as any group under Rule 13d-5(b)(1) of the Exchange Act.
6
(y) “Preferred Shares” shall mean shares of Series A Junior Participating Preferred Stock, par value $0.10 per share, of the Company having the rights and preferences set forth in the Certificate of Designations, which will be filed by the Company with the Secretary of State of Delaware on November 5, 2026, a copy of which is attached to this Agreement as Exhibit A.
(z) “Purchase Price” shall mean the price (subject to adjustment as provided herein) at which a holder of a Right may purchase one one-thousandth of a Preferred Share (subject to adjustment as provided herein), which price shall initially be $37.00.
(aa) “Receiving Party” shall have the meaning set forth in Section 1(o) hereof.
(bb) “Record Date” shall have the meaning set forth in the second paragraph hereof.
(cc) “Redemption Date” shall have the meaning set forth in Section 7(a) hereof.
(dd) “Redemption Price” shall have the meaning set forth in Section 23(a) hereof.
(ee) “Right” shall have the meaning set forth in the second paragraph hereof.
(ff) “Right Certificate” shall have the meaning set forth in Section 3(a) hereof.
(gg) “Rights Agent” shall have the meaning set forth in the first paragraph hereof.
(hh) “Securities Act” shall mean the Securities Act of 1933, as amended.
(ii) “Security” shall have the meaning set forth in Section 11(d)(i) hereof.
(jj) “Shares Acquisition Date” shall mean the first date of public announcement (which for purposes of this definition shall include, without limitation, a report filed pursuant to Section 13(d) of the Exchange Act) by the Company or an Acquiring Person that an Acquiring Person has become such, or such earlier date as a majority of the Board of Directors shall become aware of the existence of an Acquiring Person.
(kk) “Signature Guarantee” shall have the meaning set forth in Section 6(a) hereof.
(ll) “Subsidiary” of any Person shall mean any corporation or other entity of which a majority of the voting power of the voting equity securities or equity interest is owned, directly or indirectly, by such Person.
(mm) [Reserved]
(nn) “Trading Day” shall have the meaning set forth in Section 11(d) hereof.
(oo) “Trust” shall have the meaning set forth in Section 24(a) hereof.
7
(pp) “Trust Agreement” shall have the meaning set forth in Section 24(a) hereof.
Section 2. Appointment of Rights Agent. The Company hereby appoints the Rights Agent to act as rights agent for the Company in accordance with the express terms and conditions (and no implied terms or conditions) hereof, and the Rights Agent hereby accepts such appointment. The Company may from time to time appoint such co-rights agents as it may deem necessary or desirable, upon 10 days’ prior written notice to the Rights Agent. The Rights Agent shall have no duty to supervise, and shall in no event be liable for, the acts or omissions of any such co-rights agent. In the event the Company appoints one or more co-rights agent(s), the respective duties of the Rights Agent and any co-rights agent shall be as the Company shall reasonably determine, provided that such duties and determination are consistent with the terms and provisions of this Agreement and that promptly after such appointment, if any, the Company shall notify the Rights Agent in writing thereof.
Section 3. Issue of Right Certificates. The Rights shall be deemed issued, upon the terms and subject to the conditions set forth herein, as of the Record Date, or if later, the date on which the Common Shares of the Company underlying such Rights become outstanding, provided that:
(a) Until the earlier of (i) the Close of Business on the 10th day after the Shares Acquisition Date (or, if the 10th day after the Shares Acquisition Date occurs before the Record Date, the Close of Business on the Record Date) and (ii) the Close of Business on the 10th day (or such later date as the Board of Directors of the Company shall determine, prior to such time as any Person becomes an Acquiring Person) after the date that a tender or exchange offer by any Person (other than the Company, any Subsidiary of the Company, any employee of the Company or of any Subsidiary of the Company, or any Person or entity organized, appointed or established by the Company or any Subsidiary of the Company for or pursuant to the terms of any employee benefit plan of the Company or of any Subsidiary of the Company) is first published or sent or given within the meaning of Rule 14d-2(a) of the General Rules and Regulations under the Exchange Act, if, upon consummation thereof, such Person would become an Acquiring Person (the earlier of (i) and (ii), the “Distribution Date”) (provided, that if such tender or exchange offer is terminated prior to the occurrence of a Distribution Date, then no Distribution Date shall occur as a result of such tender or exchange offer), (x) the Rights, unless earlier expired, redeemed or terminated, will be evidenced (subject to the provisions of Section 3(b) hereof) by the certificates for Common Shares of the Company registered in the names of the holders thereof (which certificates shall also be deemed to be Right Certificates), or, in the case of Common Shares of the Company held in uncertificated form, by the transaction statement or other record of ownership of such Common Shares of the Company, and not by separate Right Certificates, and (y) the Rights, including the right to receive Right Certificates, will be transferable only in connection with the transfer of Common Shares of the Company. The Company shall promptly notify the Rights Agent in writing upon the occurrence of the Distribution Date and, if such notification is given orally, the Company shall confirm the same in writing on, or prior to, the Business Day next following the day on which such oral notification is given. Until such written notice is received by the Rights Agent, the Rights Agent may presume conclusively for all purposes that the Distribution Date has not occurred. As soon as practicable after the Distribution Date, the Company will prepare and execute, and upon written request from the Company, the Rights Agent will countersign, and the Company will send or cause to be sent (and the Rights Agent will, if requested and provided with all necessary
8
information and documents at the expense of the Company, send) by first-class, postage-prepaid mail, to each record holder of Common Shares of the Company as of the Close of Business on the Distribution Date (other than any Acquiring Person or any Associate or Affiliate of an Acquiring Person), at the address of such holder shown on the records of the Company or the transfer agent or registrar for the Common Shares of the Company, a Right Certificate, in substantially the form of Exhibit B hereto (a “Right Certificate”), evidencing one Right for each Common Share so held, subject to adjustment as provided herein. As of and after the Distribution Date, the Rights will be evidenced solely by such Right Certificates.
(b) With respect to any Common Shares of the Company outstanding as of the Record Date, and until the earliest of the Distribution Date, the Redemption Date and the Final Expiration Date, (i) in the case of certificated Common Shares of the Company, (A) the Rights associated with the Common Shares of the Company represented by any certificate will be evidenced by such certificate and the registered holders of the Common Shares of the Company shall also be the registered holders of the associated Rights and (B) the surrender for transfer of any such certificate shall also constitute the transfer of the Rights associated with the Common Shares of the Company represented thereby, and (ii) in the case of Common Shares of the Company held in uncertificated form, (A) the Rights associated with the Common Shares of the Company shall be evidenced by the balances indicated in the book-entry account system of the transfer agent for such Common Shares of the Company and the registered holders of the Common Shares of the Company shall also be the registered holders of the associated Rights and (B) the transfer of any Common Shares of the Company in the book-entry account system of the transfer agent for such Common Shares of the Company shall also constitute the transfer of the Rights associated with such Common Shares of the Company.
(c) In the case of certificated Common Shares of the Company, certificates issued for Common Shares of the Company after the Record Date (including upon transfer or exchange of outstanding Common Shares of the Company), but prior to the earliest of the Distribution Date, the Redemption Date and the Final Expiration Date, shall have impressed on, printed on, written on or otherwise affixed to them a legend in substantially the following form:
This certificate also evidences and entitles the holder hereof to certain rights as set forth in a Rights Agreement between The Wendy’s Company and Equiniti Trust Company, LLC, as Rights Agent (or any successor rights agent), dated as of November 4, 2026, as it may be amended, supplemented or otherwise modified from time to time (the “Agreement”), the terms of which are hereby incorporated herein by reference and a copy of which is on file at the principal executive offices of The Wendy’s Company. Under certain circumstances, as set forth in the Agreement, such Rights (as defined in the Agreement) will be evidenced by separate certificates and will no longer be evidenced by this certificate. The Wendy’s Company will mail to the holder of this certificate a copy of the Agreement without charge after receipt of a written request therefor. As set forth in the Agreement, Rights Beneficially Owned (as defined in the Agreement) by any Person (as defined in the Agreement) who becomes an Acquiring Person (as defined in the Agreement) shall be null and void.
9
With respect to such certificates containing the foregoing legend, until the Distribution Date, the Rights associated with the Common Shares of the Company represented by such certificates shall be evidenced by such certificates alone, and the surrender for transfer of any such certificate shall also constitute the transfer of the Rights associated with the Common Shares of the Company represented thereby. In the event that the Company purchases or otherwise acquires any Common Shares of the Company after the Record Date but prior to the Distribution Date, any Rights associated with such Common Shares of the Company shall be deemed cancelled and retired so that the Company shall not be entitled to exercise any Rights associated with the Common Shares of the Company which are no longer outstanding. Notwithstanding this Section 3(c), the omission of a legend shall not affect the enforceability of any part of this Agreement or the rights of any holder of the Rights.
(d) In the case of Common Shares of the Company held in uncertificated form, the Company shall cause the confirmation and account statements sent to holders of Common Shares of the Company in book-entry form (including upon transfer or exchange of outstanding Common Shares of the Company) prior to the earliest of the Distribution Date, the Redemption Date and the Final Expiration Date to bear a legend in substantially the following form:
Each share of common stock, $0.10 par value per share, of The Wendy’s Company entitles the holder thereof to certain rights as set forth in a Rights Agreement between The Wendy’s Company and Equiniti Trust Company, LLC, as Rights Agent (or any successor rights agent), dated as of November 4, 2026, as it may be amended, supplemented or otherwise modified from time to time (the “Agreement”), the terms of which are hereby incorporated herein by reference and a copy of which is on file at the principal executive offices of The Wendy’s Company. Under certain circumstances, as set forth in the Agreement, such Rights (as defined in the Agreement) will be evidenced by separate certificates and will no longer be evidenced by the shares to which this statement relates. The Wendy’s Company will mail to the holder of the shares to which this statement relates a copy of the Agreement without charge after receipt of a written request therefor. As set forth in the Agreement, Rights Beneficially Owned (as defined in the Agreement) by any Person (as defined in the Agreement) who becomes an Acquiring Person (as defined in the Agreement) shall be null and void.
Notwithstanding this Section 3(d), the omission of a legend shall not affect the enforceability of any part of this Agreement or the rights of any holder of the Rights.
Section 4. Form of Right Certificates. The Right Certificates (and the forms of election to purchase Preferred Shares and of assignment to be printed on the reverse thereof), when and if issued, shall be substantially the same as Exhibit B hereto, and may have such marks of identification or designation and such legends, summaries or endorsements printed thereon as the
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Company may deem appropriate (but which do not affect the rights, duties, liabilities or responsibilities of the Rights Agent) and as are not inconsistent with the provisions of this Agreement, or as may be required to comply with any applicable law or with any applicable rule or regulation made pursuant thereto or with any applicable rule or regulation of any stock exchange or the Financial Industry Regulatory Authority, or to conform to customary usage. Subject to the provisions of Sections 11 and 22 hereof, the Right Certificates shall entitle the holders thereof to purchase such number of one one-thousandths of a Preferred Share as shall be set forth therein at the Purchase Price, but the number of such one one-thousandths of a Preferred Share and the Purchase Price shall be subject to adjustment as provided herein.
Section 5. Countersignature and Registration.
(a) The Right Certificates shall be duly executed on behalf of the Company by its Chairman of the Board of Directors, its Chief Executive Officer, its President, any of its Vice Presidents or its Treasurer, either manually or by facsimile signature or by electronic signature, shall have affixed thereto the Company’s seal or a facsimile thereof, and shall be attested by the Secretary or an Assistant Secretary of the Company, either manually or by facsimile signature or by electronic signature. Upon written request by the Company, the Right Certificates shall be countersigned by the Rights Agent, either manually or by facsimile signature or by electronic signature, and shall not be valid for any purpose unless so countersigned. In case any officer of the Company who shall have signed or attested any of the Right Certificates shall cease to be such officer of the Company before countersignature by the Rights Agent and issuance and delivery by the Company, such Right Certificates, nevertheless, may be countersigned by the Rights Agent and issued and delivered by the Company with the same force and effect as though the individual who signed or attested such Right Certificates had not ceased to be such officer of the Company; and any Right Certificate may be signed or attested on behalf of the Company by any individual who, at the actual date of the execution of such Right Certificate, shall be a proper officer of the Company to sign such Right Certificate, although at the date of the execution of this Agreement any such individual was not such an officer.
(b) Following the Distribution Date and receipt by the Rights Agent of written notice to that effect and all other relevant information and documents referred to in Section 3(a), the Rights Agent will keep or cause to be kept, at its office or offices designated for such purpose, books for registration and transfer of the Right Certificates issued hereunder. Such books shall show the names and addresses of the respective holders of the Right Certificates, the number of Rights evidenced on its face by each of the Right Certificates and the date of each of the Right Certificates.
Section 6. Transfer, Split Up, Combination and Exchange of Right Certificates; Mutilated, Destroyed, Lost or Stolen Right Certificates.
(a) Subject to the provisions of Section 14 hereof, at any time after the Close of Business on the Distribution Date, and at or prior to the Close of Business on the earlier of the Redemption Date or the Final Expiration Date, any Right Certificate or Right Certificates (other than Right Certificates representing Rights that have become null and void pursuant to Section 11(a)(ii) hereof or that have been exchanged pursuant to Section 24 hereof) may be transferred, split up, combined or exchanged for another Right Certificate or Right Certificates
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entitling the registered holder to purchase a like number of one one-thousandths of a Preferred Share (subject to adjustment as provided herein) as the Right Certificate or Right Certificates surrendered then entitled such holder to purchase. Any registered holder desiring to transfer, split up, combine or exchange any Right Certificate or Right Certificates shall make such request in writing delivered to the Rights Agent, and shall surrender the Right Certificate or Right Certificates to be transferred, split up, combined or exchanged at the office or offices of the Rights Agent designated for such purpose, accompanied by a signature guarantee (a “Signature Guarantee”) from an eligible guarantor institution participating in a signature guarantee program approved by the Securities Transfer Association and such documentation as the Rights Agent may reasonably request. The Right Certificates are transferable only on the registry books of the Rights Agent. Neither the Rights Agent nor the Company shall be obligated to take any action whatsoever with respect to the transfer of any such surrendered Right Certificate until the registered holder thereof shall have (i) properly completed and duly executed the certificate contained in the form of assignment on the reverse side of such Right Certificate, (ii) provided such additional evidence of the identity of the Beneficial Owner (or former Beneficial Owner) thereof and of the Rights evidenced thereby and the Affiliates and Associates of such Beneficial Owner (or former Beneficial Owner) thereof as the Company or the Rights Agent shall reasonably request, and (iii) paid a sum sufficient to cover any tax or charge that may be imposed in connection with any transfer, split up, combination or exchange of Right Certificates as required hereunder. Thereupon the Rights Agent shall, subject to Sections 11(a)(ii), 14 and 24 hereof, countersign and deliver to the Person entitled thereto a Right Certificate or Right Certificates, as the case may be, as so requested, registered in such name or names as may be designated by the surrendering registered holder. The Company may require payment of a sum sufficient to cover any tax or charge that may be imposed in connection with any transfer, split up, combination or exchange of Right Certificates. The Rights Agent shall forward any such sum collected by it to the Company or to such Persons as the Company shall specify by written notice. The Rights Agent shall have no duty or obligation under any section of this Agreement that requires the payment of taxes or charges unless and until it is satisfied that all such taxes or charges have been paid.
(b) Upon receipt by the Company and the Rights Agent of evidence reasonably satisfactory to them of the loss, theft, destruction or mutilation of a Right Certificate, and such additional evidence of the identity of the Beneficial Owner (or former Beneficial Owner) or Affiliates or Associates thereof as the Company or the Rights Agent shall reasonably request, accompanied by such documentation as the Rights Agent may reasonably request, and, in case of loss, theft or destruction, of indemnity or security reasonably satisfactory to them, and, at the Company’s or the Rights Agent’s request, reimbursement to the Company and the Rights Agent of all reasonable expenses incidental thereto, and upon surrender to the Rights Agent and cancellation of the Right Certificate if mutilated, the Company will issue, execute, and deliver a new Right Certificate of like tenor to the Rights Agent for countersignature and delivery to the registered holder in lieu of the Right Certificate so lost, stolen, destroyed or mutilated.
(c) Notwithstanding any other provisions hereof, the Company and the Rights Agent may amend this Agreement to provide for uncertificated Rights in addition to or in place of Rights evidenced by Right Certificates.
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Section 7. Exercise of Rights; Purchase Price; Expiration Date of Rights.
(a) The registered holder of any Right Certificate may exercise the Rights evidenced thereby (except as otherwise provided herein), in whole or in part, at any time after the Distribution Date, upon surrender of the Right Certificate, with the appropriate form of election to purchase on the reverse side thereof properly completed and duly executed, to the Rights Agent at the office or offices of the Rights Agent designated for such purpose, accompanied by a Signature Guarantee and such documentation as the Rights Agent may reasonably request, together with payment of the Purchase Price for each one one-thousandth of a Preferred Share as to which the Rights are exercised and an amount equal to any tax or charge required to be paid in cash, or by certified check, cashier’s check or money order payable to the order of the Company, at or prior to the earliest of (i) the Close of Business on November 3, 2027 (the “Final Expiration Date”), (ii) the time at which the Rights are redeemed as provided in Section 23 hereof (the “Redemption Date”), and (iii) the time at which such Rights are exchanged as provided in Section 24 hereof. Except for those provisions herein that expressly survive the termination of this Agreement, this Agreement shall terminate at such time as the Rights are no longer exercisable hereunder.
(b) The Purchase Price shall be subject to adjustment from time to time as provided in Section 11 or 13 hereof, and shall be payable in lawful money of the United States of America in accordance with paragraph (c) below.
(c) Upon receipt of a Right Certificate representing exercisable Rights, with the appropriate form of election to purchase properly completed and duly executed, accompanied by payment of the aggregate Purchase Price for the number of Preferred Shares to be purchased and an amount equal to any applicable transfer tax or charge required to be paid by the holder of such Right Certificate in accordance with Section 9 hereof by cash or by certified check, cashier’s check or money order payable to the order of the Company, the Rights Agent shall thereupon promptly (i) (A) requisition from any transfer agent of the Preferred Shares (or from the Company if there shall be no such transfer agent, or make available if the Rights Agent is the transfer agent) certificates for the number of Preferred Shares to be purchased and the Company hereby irrevocably authorizes any such transfer agent to comply with all such requests, or (B) requisition from the depositary agent depositary receipts representing such number of one one-thousandths of a Preferred Share as are to be purchased (in which case certificates for the Preferred Shares represented by such receipts shall be deposited by the transfer agent of the Preferred Shares with such depositary agent) and the Company hereby directs such depositary agent to comply with such request; (ii) when necessary to comply with this Agreement, requisition from the Company the amount of cash to be paid in lieu of issuance of fractional shares in accordance with Section 14 hereof; (iii) after receipt of such certificates or depositary receipts, cause the same to be delivered to or upon the order of the registered holder of such Right Certificate, registered in such name or names as may be designated in writing by such holder; and (iv) when necessary to comply with this Agreement, after receipt, deliver such cash to or upon the order of the registered holder of such Right Certificate. In the event that the Company is obligated to issue securities of the Company other than Preferred Shares (including Common Shares of the Company) of the Company pursuant to Section 11(a) hereof, the Company will make all arrangements necessary so that such other securities are available for distribution by the Rights Agent.
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(d) In case the registered holder of any Right Certificate shall exercise less than all the Rights evidenced thereby, a new Right Certificate evidencing Rights equivalent to the Rights remaining unexercised shall be issued by the Rights Agent to the registered holder of such Right Certificate or to such holder’s duly authorized assigns, subject to the provisions of Section 14 hereof.
(e) Notwithstanding anything in this Agreement or any Right Certificate to the contrary, neither the Rights Agent nor the Company shall be obligated to undertake any action with respect to a registered holder of Rights or other securities upon the occurrence of any purported transfer or exercise as set forth in Section 6 hereof or this Section 7 unless such registered holder shall have (i) properly completed and duly executed the certification following the appropriate form of election to purchase set forth on the reverse side of the Right Certificate surrendered for such transfer or exercise and affixing a Signature Guarantee, (ii) tendered the Purchase Price (and an amount equal to any applicable transfer tax required to be paid by the holder of such Right Certificate in accordance with Section 9) to the Company in the manner set forth in Section 7(c), and (iii) provided such additional evidence of the identity of the Beneficial Owner (or former Beneficial Owner) or Affiliates or Associates thereof as the Company or the Rights Agent shall reasonably request.
Section 8. Cancellation and Destruction of Right Certificates. All Right Certificates surrendered for the purpose of and accepted for exercise, transfer, split up, combination or exchange shall, if surrendered to the Company or to any of its agents (other than the Rights Agent), be delivered to the Rights Agent for cancellation or in cancelled form, or, if delivered or surrendered to the Rights Agent, shall be cancelled by it, and no Right Certificates shall be issued in lieu thereof except as expressly permitted by any of the provisions of this Agreement. The Company shall deliver to the Rights Agent for cancellation and retirement, and the Rights Agent shall so cancel and retire, any other Right Certificate purchased or acquired by the Company otherwise than upon the exercise thereof. The Rights Agent shall deliver all cancelled Right Certificates to the Company, or shall, at the written request and expense of the Company, destroy or cause to be destroyed such cancelled Right Certificates, and, in such case, shall deliver a certificate of destruction thereof to the Company.
Section 9. Availability of Preferred Shares.
(a) The Company covenants and agrees that it will cause to be reserved and kept available out of its authorized and unissued Preferred Shares or any Preferred Shares held in its treasury the number of Preferred Shares that will be sufficient to permit the exercise in full of all outstanding Rights in accordance with Section 7 hereof. The Company covenants and agrees that it will take all such action as may be necessary to ensure that all Preferred Shares (or Common Shares of the Company or other securities, as the case may be) delivered upon exercise of Rights shall, at the time of delivery of the certificates for such Preferred Shares (or Common Shares of the Company and other securities, as the case may be) (subject to payment of the Purchase Price and compliance with all other applicable provisions of this Agreement), be duly and validly authorized and issued and fully paid and nonassessable shares.
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(b) The Company further covenants and agrees that it will pay when due and payable any and all taxes and charges that may be payable in respect of the issuance or delivery of the Right Certificates or of any Preferred Shares upon the exercise of Rights. The Company shall not, however, be required to pay any tax or charge that may be payable in respect of any transfer or delivery of Right Certificates to a Person other than, or the issuance or delivery of certificates or depositary receipts for the Preferred Shares in a name other than that of, the registered holder of the Right Certificate evidencing Rights surrendered for exercise or to issue or to deliver any certificates or depositary receipts for Preferred Shares upon the exercise of any Rights until any such tax or charge shall have been paid (any such tax or charge being payable by the holder of such Right Certificate at the time of surrender) or until it has been established to the Company’s and the Rights Agent’s reasonable satisfaction that no such tax or charge is due.
Section 10. Preferred Shares Record Date. Each Person in whose name any certificate for Preferred Shares is issued upon the exercise of Rights shall for all purposes be deemed to have become the holder of record of the Preferred Shares represented thereby on, and such certificate shall be dated, the date upon which the Right Certificate evidencing such Rights was duly surrendered with the forms of election and certification properly completed and duly executed and payment of the Purchase Price (and any applicable taxes or charges) was made; provided, however, that, if the date of such surrender and payment is a date upon which the Preferred Shares transfer books of the Company are closed, such Person shall be deemed to have become the record holder of such shares on, and such certificate shall be dated, the next succeeding Business Day on which the Preferred Shares transfer books of the Company are open. Prior to the exercise of the Rights evidenced thereby, the holder of a Right Certificate shall not be entitled to any rights of a holder of Preferred Shares for which the Rights shall be exercisable, including, without limitation, the right to vote, to receive dividends or other distributions or to exercise any preemptive rights, and shall not be entitled to receive any notice of any proceedings of the Company, except as provided herein.
Section 11. Adjustment of Purchase Price, Number of Shares or Number of Rights. The Purchase Price, the number of Preferred Shares covered by each Right and the number of Rights outstanding are subject to adjustment from time to time as provided in this Section 11.
(a) (i) In the event the Company shall at any time after the date of this Agreement (A) declare and pay a dividend on the Preferred Shares payable in Preferred Shares, (B) subdivide the outstanding Preferred Shares, (C) combine the outstanding Preferred Shares into a smaller number of Preferred Shares or (D) issue any shares of its capital stock in a reclassification of the Preferred Shares (including any such reclassification in connection with a share exchange, consolidation or merger in which the Company is the continuing or surviving corporation), except as otherwise provided in this Section 11(a), the Purchase Price in effect at the time of the record date for such dividend or of the effective date of such subdivision, combination or reclassification, and the number and kind of shares of capital stock issuable upon exercise of a Right as of the record date for such dividend or the effective date of such subdivision, combination or reclassification, shall be proportionately adjusted so that the holder of any Right exercised after such time shall be entitled to receive the aggregate number and kind of shares of capital stock which, if such Right had been exercised immediately prior to such date and at a time when the Preferred Shares transfer books of the Company were open, such holder would have owned upon such exercise and been entitled to receive by virtue of such dividend, subdivision, combination or reclassification; provided, however, that in no event shall the consideration to be paid upon the exercise of one Right be less than the aggregate par value of the shares of capital stock of the Company issuable upon exercise of one Right.
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(ii) Subject to Section 24 hereof, in the event any Person becomes an Acquiring Person, each holder of a Right shall thereafter have a right to receive, upon exercise thereof at a price equal to the then-current Purchase Price multiplied by the number of one one-thousandths of a Preferred Share for which a Right is then exercisable, in accordance with the terms of this Agreement and in lieu of Preferred Shares, such number of Common Shares of the Company as shall equal the result obtained by (A) multiplying the then-current Purchase Price by the number of one one-thousandths of a Preferred Share for which a Right is then exercisable and dividing that product by (B) 50% of the then-current per share market price of the Common Shares of the Company (determined pursuant to Section 11(d) hereof) on the date on which such Person becomes an Acquiring Person (such number of shares, the “Adjustment Shares”). In the event that any Person shall become an Acquiring Person and the Rights shall then be outstanding, the Company shall not take any action which would eliminate or diminish the benefits intended to be afforded by the Rights.
From and after the occurrence of any Person becoming an Acquiring Person, any Rights that are or were acquired or Beneficially Owned by (i) any Acquiring Person (or any Associate or Affiliate of such Acquiring Person), (ii) a transferee of an Acquiring Person (or of any Associate or Affiliate of an Acquiring Person) who becomes a transferee after any Person becomes an Acquiring Person, (iii) a transferee of an Acquiring Person (or of any Associate or Affiliate of an Acquiring Person) who becomes a transferee prior to or concurrently with any Person becoming an Acquiring Person and receives such Rights pursuant to either (x) a transfer (whether or not for consideration) from the Acquiring Person (or any Associate or Affiliate of an Acquiring Person) to holders of equity interests in such Acquiring Person (or in any Associate or Affiliate of an Acquiring Person) or to any Person with whom the Acquiring Person (or any Associate or Affiliate of an Acquiring Person) has any continuing agreement, arrangement or understanding regarding the transferred Rights or (y) a transfer which the Board of Directors of the Company determines is part of a plan, arrangement or understanding which has as a primary purpose or effect of the avoidance of this section, or (iv) any subsequent transferee receiving transferred Rights from any such transferee referred to in clauses (ii) or (iii), either directly or through one or more intermediate transferees, shall, in each case, be null and void without any further action, and any holder of such Rights shall thereafter have no right to exercise such Rights under any provision of this Agreement or otherwise. The Rights Agent shall not have liability to any holder of Right Certificates or other Person as a result of the Company’s failure to make any determinations with respect to an Acquiring Person or its Affiliates, Associates or transferees hereunder. No Right Certificate shall be issued pursuant to Section 3 hereof that represents Rights Beneficially Owned by an Acquiring Person whose Rights would be null and void pursuant to this subparagraph (ii) or any Associate or Affiliate thereof; no Right Certificate shall be issued at any time upon the transfer of any Rights to an Acquiring Person whose Rights would be null and void pursuant to this subparagraph (ii) or any Associate or Affiliate thereof or to any nominee of such Acquiring Person, Associate or Affiliate or with respect to any Common Shares of the Company otherwise deemed to be Beneficially Owned by any of the foregoing; and any Right Certificate delivered to the Rights Agent for transfer to an Acquiring Person or other Person whose Rights would be null and void pursuant to this subparagraph (ii) shall be cancelled. The Company shall give the Rights Agent written notice of the identity of any such Acquiring Person, Associate or Affiliate, or the nominee of any of the foregoing, and the Rights Agent may rely on such written notice in carrying out its duties under this Agreement and shall be deemed not to have any knowledge of the identity of any such Acquiring Person, Associate or Affiliate, or the nominee of any of the foregoing, unless and until it shall have received such written notice.
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(iii) In the event that there shall not be sufficient Common Shares of the Company issued but not outstanding or authorized but unissued (after taking into account, at the discretion of the Board of Directors of the Company, any necessary reserves of Common Shares of the Company) to permit the exercise in full of the Rights in accordance with subparagraph (ii) above, the Company shall either (A) take all such action as may be necessary to authorize additional Common Shares of the Company for issuance upon exercise of the Rights or (B) (1) determine the value of the Adjustment Shares issuable upon the exercise of a Right (the “Current Value”), and (2) with respect to each Right (which shall not include Rights that have become void pursuant to the provisions of Section 11(a)(ii) hereof), make adequate provision to substitute for the Adjustment Shares, upon the exercise of a Right and payment of the applicable Purchase Price, (x) a number of Preferred Shares (or fraction thereof), or (y) any combination of Common Shares of the Company and Preferred Shares (or fraction thereof), in any case set forth in (x) or (y) having a value equal to the Current Value. For purposes of this Section 11(a)(iii), (A) the value of each Adjustment Share shall be the current per share market price of the Common Shares of the Company (as determined pursuant to Section 11(d) hereof), (B) the value of each Common Share shall be the current per share market price of the Common Shares of the Company (as determined pursuant to Section 11(d) hereof) and (C) the value of each Preferred Share shall be the current per share market price of the Preferred Shares (as determined pursuant to Section 11(d) hereof), in each case on such date as any Person becomes an Acquiring Person.
(b) In case the Company shall fix a record date for the issuance of rights, options or warrants to all holders of Preferred Shares entitling them (for a period expiring within 45 calendar days after such record date) to subscribe for or purchase Preferred Shares (or shares having similar rights, privileges and preferences as the Preferred Shares (“equivalent preferred shares”)) or securities convertible into Preferred Shares or equivalent preferred shares at a price per Preferred Share or equivalent preferred share (or having a conversion price per share, if a security convertible into Preferred Shares or equivalent preferred shares) less than the then-current per share market price (as defined in Section 11(d)) of the Preferred Shares on such record date, the Purchase Price to be in effect after such record date shall be determined by multiplying the Purchase Price in effect immediately prior to such record date by a fraction, the numerator of which shall be the number of Preferred Shares outstanding on such record date plus the number of Preferred Shares which the aggregate offering price of the total number of Preferred Shares and/or equivalent preferred shares so to be offered (and/or the aggregate initial conversion price of the convertible securities so to be offered) would purchase at such current market price and the denominator of which shall be the number of Preferred Shares outstanding on such record date plus the number of additional Preferred Shares and/or equivalent preferred shares to be offered for subscription or purchase (or into which the convertible securities so to be offered are initially convertible); provided, however, that in no event shall the consideration to be paid upon the exercise of one Right be less than the aggregate par value of the shares of capital stock of the Company issuable upon exercise of one Right. In case such subscription price may be paid in consideration part or all of which shall be in a form other than cash, the value of such consideration shall be as determined by the Board of Directors of the Company, whose determination shall be described in a statement filed with the Rights Agent and shall be binding on the Rights Agent and
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holders of the Rights. Preferred Shares owned by or held for the account of the Company or any Subsidiary of the Company shall not be deemed outstanding for the purpose of any such computation. Such adjustment shall be made successively whenever such a record date is fixed; and, in the event that such rights, options or warrants are not so issued, the Purchase Price shall be adjusted to be the Purchase Price which would then be in effect if such record date had not been fixed.
(c) In case the Company shall fix a record date for the making of a distribution to all holders of the Preferred Shares (including any such distribution made in connection with a share exchange, consolidation or merger in which the Company is the continuing or surviving corporation) of evidences of indebtedness or assets (other than a regular quarterly cash dividend or a dividend payable in Preferred Shares) or subscription rights or warrants (excluding those referred to in Section 11(b) hereof), the Purchase Price to be in effect after such record date shall be determined by multiplying the Purchase Price in effect immediately prior to such record date by a fraction, the numerator of which shall be the then current per share market price of the Preferred Shares on such record date, less the fair market value (as determined by the Board of Directors of the Company, whose determination shall be described in a statement filed with the Rights Agent) of the portion of the assets or evidences of indebtedness so to be distributed or of such subscription rights or warrants applicable to one Preferred Share and the denominator of which shall be such then current per share market price of the Preferred Shares on such record date; provided, however, that in no event shall the consideration to be paid upon the exercise of one Right be less than the aggregate par value of the shares of capital stock of the Company to be issued upon exercise of one Right. Such adjustments shall be made successively whenever such a record date is fixed; and, in the event that such distribution is not so made, the Purchase Price shall again be adjusted to be the Purchase Price which would then be in effect if such record date had not been fixed.
(d) (i) For the purpose of any computation hereunder, the “current per share market price” of any security (a “Security” for the purpose of this Section 11(d)(i)) on any date shall be deemed to be the average of the daily closing prices per share of such Security for the 30 consecutive Trading Days immediately prior to such date; provided, however, that, in the event that the current per share market price of the Security is determined during a period following the announcement by the issuer of such Security of (A) a dividend or distribution on such Security payable in shares of such Security or Securities convertible into such shares, or (B) any subdivision, combination or reclassification of such Security, and prior to the expiration of 30 Trading Days after the ex-dividend date for such dividend or distribution, or the record date for such subdivision, combination or reclassification, then, and in each such case, the current per share market price shall be appropriately adjusted to reflect the current market price per share equivalent of such Security. The closing price for each day shall be the last sale price, regular way, reported at or prior to 4:00 P.M. Eastern time or, in case no such sale takes place on such day, the average of the bid and asked prices, regular way, reported as of 4:00 P.M. Eastern time, in either case, as reported in the principal consolidated transaction reporting system with respect to securities listed or admitted to trading on NASDAQ or, if the Security is not listed or admitted to trading on NASDAQ, as reported in the principal consolidated transaction reporting system with respect to securities listed on the principal national securities exchange on which the Security is listed or admitted to trading or, if the Security is not listed or admitted to trading on any national securities exchange, the last quoted price reported at or prior to 4:00 P.M. Eastern time or, if not so quoted,
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the average of the high bid and low asked prices in the over-the-counter market, as reported as of 4:00 P.M. Eastern time by NASDAQ or such other system then in use, or, if on any such date the Security is not quoted by any such organization, the average of the closing bid and asked prices as furnished by a professional market maker making a market in the Security selected by the Board of Directors of the Company. The term “Trading Day” shall mean a day on which the principal national securities exchange on which the Security is listed or admitted to trading is open for the transaction of business, or, if the Security is not listed or admitted to trading on any national securities exchange, a Business Day.
(ii) For the purpose of any computation hereunder, the “current per share market price” of the Preferred Shares shall be determined in accordance with the method set forth in Section 11(d)(i). If the Preferred Shares are not publicly traded, the “current per share market price” of the Preferred Shares shall be conclusively deemed to be the current per share market price of the Common Shares of the Company as determined pursuant to Section 11(d)(i) hereof (appropriately adjusted to reflect any stock split, stock dividend or similar transaction occurring after the date hereof), multiplied by one thousand. If neither the Common Shares of the Company nor the Preferred Shares are publicly held or so listed or traded, “current per share market price” shall mean the fair value per share as determined by the Board of Directors of the Company, whose determination shall be described in a statement filed with the Rights Agent.
(e) No adjustment in the Purchase Price shall be required unless such adjustment would require an increase or decrease of at least 1% in the Purchase Price; provided, however, that any adjustments which by reason of this Section 11(e) are not required to be made shall be carried forward and taken into account in any subsequent adjustment. All calculations under this Section 11 shall be made to the nearest cent or to the nearest one one-millionth of a Preferred Share or one ten-thousandth of any other share or security as the case may be. Notwithstanding the first sentence of this Section 11(e), any adjustment required by this Section 11 shall be made no later than the earlier of (i) three years from the date of the transaction which requires such adjustment or (ii) the date of the expiration of the right to exercise any Rights.
(f) If, as a result of an adjustment made pursuant to Section 11(a) hereof, the holder of any Right thereafter exercised shall become entitled to receive any shares of capital stock of the Company other than Preferred Shares, the number of such other shares so receivable upon exercise of any Right shall be subject to adjustment from time to time in a manner and on terms as nearly equivalent as practicable to the provisions with respect to the Preferred Shares contained in Section 11(a) through (c) hereof, inclusive, and the provisions of Sections 7, 9, 10 and 13 hereof with respect to the Preferred Shares shall apply on like terms to any such other shares.
(g) All Rights originally issued by the Company subsequent to any adjustment made to the Purchase Price hereunder shall evidence the right to purchase, at the adjusted Purchase Price, the number of one one-thousandths of a Preferred Share purchasable from time to time hereunder upon exercise of the Rights, all subject to further adjustment as provided herein.
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(h) Unless the Company shall have exercised its election as provided in Section 11(i) hereof, upon each adjustment of the Purchase Price as a result of the calculations made in Sections 11(b) and (c) hereof, each Right outstanding immediately prior to the making of such adjustment shall thereafter evidence the right to purchase, at the adjusted Purchase Price, that number of one one-thousandths of a Preferred Share (calculated to the nearest one one-millionth of a Preferred Share) obtained by (A) multiplying (x) the number of one one-thousandths of a share covered by a Right immediately prior to this adjustment by (y) the Purchase Price in effect immediately prior to such adjustment of the Purchase Price and (B) dividing the product so obtained by the Purchase Price in effect immediately after such adjustment of the Purchase Price.
(i) The Company may elect, on or after the date of any adjustment of the Purchase Price, to adjust the number of Rights in substitution for any adjustment in the number of one one-thousandths of a Preferred Share purchasable upon the exercise of a Right. Each of the Rights outstanding after such adjustment of the number of Rights shall be exercisable for the number of one one-thousandths of a Preferred Share for which a Right was exercisable immediately prior to such adjustment. Each Right held of record prior to such adjustment of the number of Rights shall become that number of Rights (calculated to the nearest one ten-thousandth) obtained by dividing the Purchase Price in effect immediately prior to adjustment of the Purchase Price by the Purchase Price in effect immediately after adjustment of the Purchase Price. The Company shall make a public announcement (with prompt written notice thereof to the Rights Agent) of its election to adjust the number of Rights, indicating the record date for the adjustment, and, if known at the time, the amount of the adjustment to be made. This record date may be the date on which the Purchase Price is adjusted or any day thereafter, but, if the Right Certificates have been issued, shall be at least 10 days later than the date of the public announcement. If Right Certificates have been issued, upon each adjustment of the number of Rights pursuant to this Section 11(i), the Company shall, as promptly as practicable, cause to be distributed to holders of record of Right Certificates on such record date Right Certificates evidencing, subject to Section 14 hereof, the additional Rights to which such holders shall be entitled as a result of such adjustment, or, at the option of the Company, shall cause to be distributed to such holders of record in substitution and replacement for the Right Certificates held by such holders prior to the date of adjustment, and upon surrender thereof, if required by the Company, new Right Certificates evidencing all the Rights to which such holders shall be entitled after such adjustment. Right Certificates so to be distributed shall be issued, executed and delivered by the Company, and countersigned by the Rights Agent in the manner provided for herein, and shall be registered in the names of the holders of record of Right Certificates on the record date specified in the public announcement.
(j) Irrespective of any adjustment or change in the Purchase Price or in the number of one one-thousandths of a Preferred Share issuable upon the exercise of the Rights, the Right Certificates theretofore and thereafter issued may continue to express the Purchase Price and the number of one one-thousandths of a Preferred Share which were expressed in the initial Right Certificates issued hereunder.
(k) Before taking any action that would cause an adjustment reducing the Purchase Price below the then par value, if any, of one one-thousandths of a Preferred Share issuable upon exercise of the Rights, the Company shall take any corporate action which may, in the opinion of its counsel, be necessary in order that the Company may validly and legally issue fully paid and non-assessable Preferred Shares at such adjusted Purchase Price.
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(l) In any case in which this Section 11 shall require that an adjustment in the Purchase Price be made effective as of a record date for a specified event, the Company may elect to defer (with prompt written notice thereof to the Rights Agent) until the occurrence of such event the issuing to the holder of any Right exercised after such record date of the Preferred Shares and other capital stock or securities of the Company, if any, issuable upon such exercise over and above the Preferred Shares and other capital stock or securities of the Company, if any, issuable upon such exercise on the basis of the Purchase Price in effect prior to such adjustment; provided, however, that the Company shall deliver to such holder a due bill or other appropriate instrument evidencing such holder’s right to receive such additional shares upon the occurrence of the event requiring such adjustment.
(m) Anything in this Section 11 to the contrary notwithstanding, the Company shall be entitled to make such adjustments in the Purchase Price, in addition to those adjustments expressly required by this Section 11, as and to the extent that it, in its sole discretion, shall determine to be advisable in order that any consolidation or subdivision of the Preferred Shares, issuance wholly for cash of any Preferred Shares at less than the current market price, issuance wholly for cash of Preferred Shares or securities which by their terms are convertible into or exchangeable for Preferred Shares, dividends on Preferred Shares payable in Preferred Shares or issuance of rights, options or warrants referred to in Section 11(b) hereof, hereafter made by the Company to holders of the Preferred Shares, shall not be taxable to such stockholders.
(n) In the event that, at any time after the date of this Agreement and prior to the Distribution Date, the Company shall (i) declare or pay any dividend on the Common Shares of the Company payable in Common Shares of the Company, or (ii) effect a subdivision, combination or consolidation of the Common Shares of the Company (by reclassification or otherwise than by payment of dividends in Common Shares of the Company) into a greater or lesser number of Common Shares of the Company, then, in any such case, (A) the number of one one-thousandths of a Preferred Share purchasable after such event upon proper exercise of each Right shall be determined by multiplying the number of one one-thousandths of a Preferred Share so purchasable immediately prior to such event by a fraction, the numerator of which is the number of Common Shares of the Company outstanding immediately before such event and the denominator of which is the number of Common Shares of the Company outstanding immediately after such event, and (B) each Common Share of the Company outstanding immediately after such event shall have issued with respect to it that number of Rights which each Common Share of the Company outstanding immediately prior to such event had issued with respect to it. The adjustments provided for in this Section 11(n) shall be made successively whenever such a dividend is declared or paid or such a subdivision, combination or consolidation occurs.
Section 12. Certificate of Adjusted Purchase Price or Number of Shares. Whenever an adjustment is made or any event occurs affecting the Rights or their exercisability (including an event that causes Rights to become null and void) as provided in Section 11 or 13 hereof, the Company shall promptly (a) prepare a certificate setting forth such adjustment or describing such event and a brief, reasonably detailed statement of the facts, computation and methodology accounting for such adjustment or describing such event, (b) file with the Rights Agent and with each transfer agent for the Common Shares of the Company and the Preferred Shares a copy of such certificate and (c) if such adjustment occurs at any time after the Distribution Date, mail a brief summary thereof to each holder of a Right Certificate who shall request it in accordance with Section 25 hereof. The Rights Agent shall be fully protected and incur no liability in relying on any such certificate and on any adjustment contained therein and shall not be deemed to have
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knowledge of any such adjustment or event unless and until it shall have received such a certificate. Notwithstanding the foregoing, the failure of the Company to make such certification or give such notice shall not affect the validity of, or the force or effect of, the requirement for such adjustment. Any adjustment to be made pursuant to Section 11 or 13 hereof shall be effective as of the date of the event giving rise to such adjustment.
Section 13. Consolidation, Merger or Sale or Transfer of Assets or Earning Power.
(a) In the event, directly or indirectly, at any time after a Person has become an Acquiring Person, (i) the Company shall effect a share exchange, consolidate with, or merge with and into, any other Person, (ii) any Person shall effect a share exchange, consolidate with the Company, or merge with and into the Company, and the Company shall be the continuing or surviving corporation of such share exchange, consolidation or merger (and, in connection with such merger, all or part of the Common Shares of the Company shall be changed into or exchanged for stock or other securities of any other Person (or the Company) or cash or any other property), or (iii) the Company shall sell or otherwise transfer (or one or more of its Subsidiaries shall sell or otherwise transfer), in one or more transactions, assets or earning power aggregating 50% or more of the assets or earning power of the Company and its Subsidiaries (taken as a whole) to any Person other than the Company or one or more of its wholly-owned Subsidiaries, then, and in each such case, proper provision shall be made so that (A) each holder of a Right (except as otherwise provided herein) shall thereafter have the right to receive, upon the exercise thereof at a price equal to the then-current Purchase Price multiplied by the number of one one-thousandths of a Preferred Share for which a Right is then exercisable, in accordance with the terms of this Agreement and in lieu of Preferred Shares, such number of validly issued, fully paid and non-assessable and freely tradable Common Shares of such other Person (including the Company as successor thereto or as the surviving corporation) (such “issuer”) as shall equal the result obtained by (1) multiplying the then current Purchase Price by the number of one one-thousandths of a Preferred Share for which a Right is then exercisable and dividing that product by (2) 50% of the then current per share market price of the Common Shares of such issuer (determined pursuant to Section 11(d) hereof) on the date of consummation of such consolidation, merger, sale or transfer; (B) such issuer of such Common Shares shall thereafter be liable for, and shall assume, by virtue of such consolidation, merger, sale or transfer, all the obligations and duties of the Company pursuant to this Agreement; (C) the term “Company” shall thereafter be deemed to refer to such issuer; and (D) such issuer shall take such steps (including, but not limited to, the reservation of a sufficient number of its Common Shares in accordance with Section 9 hereof) in connection with such consummation as may be necessary to assure that the provisions hereof shall thereafter be applicable, as nearly as reasonably may be, in relation to the Common Shares of the Company thereafter deliverable upon the exercise of the Rights.
(b) The Company shall not consummate any such consolidation, merger, sale or transfer described in the foregoing subsection (a) unless, prior thereto, the Company and such issuer shall have executed and delivered to the Rights Agent a supplemental agreement so providing and further providing that, as soon as practicable after executing such agreement pursuant to this Section 13, such issuer will:
(i) prepare and file a registration statement under the Securities Act, if necessary, with respect to the Rights and the securities purchasable upon exercise of the
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Rights on an appropriate form, use its best efforts to cause such registration statement to become effective as soon as practicable after such filing and use its best efforts to cause such registration statement to remain effective (with a prospectus at all times meeting the requirements of the Securities Act) until the Final Expiration Date, and similarly comply with applicable state securities laws;
(ii) use its best efforts, if the Common Shares of such issuer shall be listed or admitted to trading on NASDAQ or on another national securities exchange, to list or admit to trading (or continue the listing of) the Rights and the securities purchasable upon exercise of the Rights on NASDAQ or such securities exchange, or, if the Common Shares of such issuer shall not be listed or admitted to trading on NASDAQ or a national securities exchange, to cause the Rights and the securities receivable upon exercise of the Rights to be reported by such other system then in use;
(iii) deliver to holders of the Rights historical financial statements for such issuer which comply in all respects with the requirements for registration on Form 10 (or any successor form) under the Exchange Act; and
(iv) obtain waivers of any rights of first refusal or preemptive rights in respect of the Common Shares of such issuer subject to purchase upon exercise of outstanding Rights.
(c) The Company shall not enter into any transaction of the kind referred to in this Section 13 if at the time of or immediately after such transaction there are any rights, warrants, instruments or securities outstanding or any agreements or arrangements which, as a result of the consummation of such transaction, would eliminate or substantially diminish the benefits intended to be afforded by the Rights. The provisions of this Section 13 shall similarly apply to successive mergers, share exchanges, or consolidations or sales or other transfers.
Section 14. Fractional Rights and Fractional Shares.
(a) The Company shall not be required to issue fractions of Rights or to distribute Right Certificates which evidence fractional Rights. If the Company determines not to issue fractional Rights, then in lieu of such fractional Rights, there shall be paid to the registered holders of the Right Certificates with regard to which such fractional Rights would otherwise be issuable, an amount in cash equal to the same fraction of the current market value of a whole Right. For the purposes of this Section 14(a), the current market value of a whole Right shall be the closing price of the Rights for the Trading Day immediately prior to the date on which such fractional Rights would have been otherwise issuable. The closing price for any day shall be the last sale price, regular way, or, in case no such sale takes place on such day, the average of the closing bid and asked prices, regular way, in either case, as reported in the principal consolidated transaction reporting system with respect to securities listed or admitted to trading on NASDAQ or, if the Rights are not listed or admitted to trading on NASDAQ, as reported in the principal consolidated transaction reporting system with respect to securities listed on the principal national securities exchange on which the Rights are listed or admitted to trading or, if the Rights are not listed or admitted to trading on any national securities exchange, the last quoted price or, if not so quoted, the average of the high bid and low asked prices in the over-the-counter market, as reported
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by NASDAQ or such other system then in use or, if on any such date the Rights are not quoted by any such organization, the average of the closing bid and asked prices as furnished by a professional market maker making a market in the Rights selected by the Board of Directors of the Company. If on any such date no such market maker is making a market in the Rights, the fair value of the Rights on such date as determined by the Board of Directors of the Company shall be used, and the Rights Agent shall be fully protected in relying on such determination.
(b) The Company shall not be required to issue fractions of Preferred Shares (other than fractions which are integral multiples of one one-thousandth of a Preferred Share) upon exercise of the Rights or to distribute certificates which evidence fractional Preferred Shares (other than fractions which are integral multiples of one one-thousandth of a Preferred Share). Fractions of Preferred Shares in integral multiples of one one-thousandth of a Preferred Share may, at the election of the Company, be evidenced by depositary receipts, pursuant to an appropriate agreement between the Company and a depositary selected by it; provided that such agreement shall provide that the holders of such depositary receipts shall have all the rights, privileges and preferences to which they are entitled as beneficial owners of the Preferred Shares represented by such depositary receipts. In lieu of fractional Preferred Shares that are not integral multiples of one one-thousandth of a Preferred Share, the Company shall pay to the registered holders of Right Certificates at the time such Rights are exercised as herein provided an amount in cash equal to the same fraction of the current market value of one Preferred Share. For the purposes of this Section 14(b), the current market value of a Preferred Share shall be the closing price of a Preferred Share (as determined pursuant to the second sentence of Section 11(d)(i) hereof) for the Trading Day immediately prior to the date of such exercise.
(c) The holder of a Right, by the acceptance of the Right, expressly waives such holder’s right to receive any fractional Rights or any fractional shares upon exercise of a Right (except as provided above).
(d) Whenever a payment for fractional Rights or fractional shares or other securities is to be made by the Rights Agent under any section of this Agreement, the Company shall (i) promptly prepare and deliver to the Rights Agent a certificate setting forth in reasonable detail the facts related to such payments and the prices and/or formulas utilized in calculating such payments, and (ii) provide sufficient monies to the Rights Agent in the form of fully collected funds to make such payments. The Rights Agent shall be fully protected in relying upon such a certificate and shall have no duty with respect to, and shall not be deemed to have knowledge of any payment for fractional Rights or fractional shares or other securities under any section of this Agreement relating to the payment of fractional Rights or fractional shares or other securities unless and until the Rights Agent shall have received such a certificate and sufficient monies.
Section 15. Rights of Action. All rights of action in respect of this Agreement, excepting the rights of action given to the Rights Agent under any section of this Agreement, are vested in the respective registered holders of the Right Certificates (and, prior to the Distribution Date, the registered holders of the Common Shares of the Company); and any registered holder of any Right Certificate (or, prior to the Distribution Date, of the Common Shares of the Company), without the consent of the Rights Agent or of the holder of any other Right Certificate (or, prior to the Distribution Date, of the Common Shares of the Company), may, on such holder’s own behalf and for such holder’s own benefit, enforce, and may institute and maintain any suit, action or
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proceeding against the Company to enforce, or otherwise act in respect of, such holder’s right to exercise the Rights evidenced by such Right Certificate in the manner provided in such Right Certificate and in this Agreement. Without limiting the foregoing or any remedies available to the holders of Rights, it is specifically acknowledged that the holders of Rights would not have an adequate remedy at law for any breach of this Agreement by the Company, and will be entitled to specific performance of the obligations under, and injunctive relief against actual or threatened violations by the Company of its obligations under this Agreement. Notwithstanding anything in this Agreement to the contrary, neither the Company nor the Rights Agent shall have any liability to any holder of a Right or other Person as a result of the Company’s or the Rights Agent’s inability to perform any of their respective obligations under this Agreement by reason of any preliminary or permanent injunction or other order, judgment, decree or ruling (whether interlocutory or final) issued by a court or a governmental, regulatory, self-regulatory or administrative agency or commission, or any statute, rule, regulation or executive order promulgated or enacted by any governmental authority, prohibiting or otherwise restraining performance of such obligation.
Section 16. Agreement of Right Holders. Every holder of a Right, by accepting the same, consents and agrees with the Company and the Rights Agent and with every other holder of a Right that:
(a) prior to the Distribution Date, the Rights will be transferable only in connection with the transfer of the Common Shares of the Company;
(b) after the Distribution Date, the Right Certificates are transferable (subject to the provisions of this Agreement) only on the registry books maintained by the Rights Agent if surrendered at the office or offices of the Rights Agent designated for such purpose, duly endorsed or accompanied by a proper instrument of transfer and with the appropriate form of assignment and certificates with a Signature Guarantee affixed thereto, properly completed and duly executed, accompanied by such documentation as the Rights Agent may reasonably request; and
(c) the Company and the Rights Agent may deem and treat the person in whose name the Right Certificate (or, prior to the Distribution Date, the associated Common Shares of the Company certificate) is registered as the absolute owner thereof and of the Rights evidenced thereby (notwithstanding any notations of ownership or writing on the Right Certificate or the associated Common Shares of the Company certificate made by anyone other than the Company or the Rights Agent) for all purposes whatsoever, and neither the Company nor the Rights Agent shall be affected by any notice to the contrary.
Section 17. Right Certificate Holder Not Deemed a Stockholder. No holder, as such, of any Right Certificate shall be entitled to vote, receive dividends or be deemed for any purpose the holder of the Preferred Shares or any other securities of the Company which may at any time be issuable on the exercise or exchange of the Rights represented thereby, nor shall anything contained herein or in any Right Certificate be construed to confer upon the holder of any Right Certificate, as such, any of the rights of a stockholder of the Company or any right to vote for the election of directors or upon any matter submitted to stockholders at any meeting thereof, or to give or withhold consent to any corporate action, or to receive notice of meetings or other actions affecting stockholders (except as provided in Section 25 hereof), or to receive dividends or subscription rights, or otherwise, until the Right or Rights evidenced by such Right Certificate shall have been exercised or exchanged in accordance with the provisions hereof.
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Section 18. Concerning the Rights Agent.
(a) The Company agrees to pay to the Rights Agent reasonable compensation for all services rendered by it hereunder in accordance with a mutually agreed upon fee schedule, and, from time to time, on demand of the Rights Agent, its reasonable expenses and counsel fees and expenses and other disbursements incurred in the preparation, negotiation, delivery, amendment, administration and execution of this Agreement and the exercise and performance of its duties hereunder. The Company also agrees to indemnify the Rights Agent for, and to hold it harmless against, any loss, liability, damage, judgment, fine, penalty, claim, demand, settlement, cost or expense (including, without limitation, the reasonable fees and expenses of legal counsel) that may be paid, incurred or suffered by it, or to which it may become subject, without gross negligence, bad faith or willful misconduct on the part of the Rights Agent (each as determined by a final, nonappealable judgment of a court of competent jurisdiction), for any action taken, suffered or omitted to be taken by the Rights Agent in connection with the execution, acceptance, administration, exercise and performance of its duties under this Agreement, including the costs and expenses of defending against any claim in connection herewith. The costs and expenses incurred in enforcing this right of indemnification shall also be paid by the Company. The provisions of this Section 18 and Section 20 below shall survive the exercise or expiration of the Rights, the termination of this Agreement and the resignation, replacement or removal of the Rights Agent.
(b) The Rights Agent may conclusively rely upon and shall be fully authorized and protected and shall incur no liability for, or in respect of any action taken, suffered or omitted to be taken by it in connection with its acceptance and administration of this Agreement, and the exercise and performance of its duties hereunder, in reliance upon any Right Certificate or certificate for the Preferred Shares or Common Shares of the Company or for other securities of the Company (including in the case of uncertificated securities, by notation in book entry accounts reflecting ownership), instrument of assignment or transfer, power of attorney, endorsement, affidavit, letter, notice, instruction, direction, consent, certificate, statement, or other paper or document reasonably believed by it to be genuine and to be signed, executed and, where necessary, verified or acknowledged, by the proper Person or Persons, or otherwise upon the advice of counsel as set forth in Section 20 hereof. The Rights Agent shall not be deemed to have knowledge of any event of which it was supposed to receive notice thereof hereunder, and the Rights Agent shall be fully protected and shall incur no liability for failing to take any action in connection therewith unless and until it has received such notice in writing in accordance with Section 26.
Section 19. Merger or Consolidation or Change of Name of Rights Agent.
(a) Any Person into which the Rights Agent (or any successor Rights Agent) may be merged or with which it may effect a share exchange, be consolidated, or any Person resulting from any merger, share exchange, or consolidation to which the Rights Agent or any successor Rights Agent shall be a party, or any Person succeeding to the stock transfer or other shareholder services business of the Rights Agent or any successor Rights Agent, shall be the successor to the Rights Agent under this Agreement without the execution or filing of any paper
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or document or any further act on the part of any of the parties hereto; provided that such Person would be eligible for appointment as a successor Rights Agent under the provisions of Section 21 hereof. The purchase of all or substantially all of the Rights Agent’s assets employed in the performance of transfer agent activities shall be deemed a merger or consolidation for purposes of this Section 19. In case at the time such successor Rights Agent shall succeed to the agency created by this Agreement, any of the Right Certificates shall have been countersigned but not delivered, any such successor Rights Agent may adopt the countersignature of the predecessor Rights Agent and deliver such Right Certificates so countersigned; and, in case at that time any of the Right Certificates shall not have been countersigned, any successor Rights Agent may countersign such Right Certificates either in the name of the predecessor Rights Agent or in the name of the successor Rights Agent; and, in all such cases, such Right Certificates shall have the full force provided in the Right Certificates and in this Agreement.
(b) In case at any time the name of the Rights Agent shall be changed and at such time any of the Right Certificates shall have been countersigned but not delivered, the Rights Agent may adopt the countersignature under its prior name and deliver Right Certificates so countersigned; and, in case at that time any of the Right Certificates shall not have been countersigned, the Rights Agent may countersign such Right Certificates either in its prior name or in its changed name; and, in all such cases, such Right Certificates shall have the full force provided in the Right Certificates and in this Agreement.
Section 20. Rights and Duties of Rights Agent. The Rights Agent undertakes to perform only the duties and obligations expressly set forth in this Agreement and no implied duties or obligations shall be read into this Agreement against the Rights Agent. The Rights Agent shall perform those duties and obligations upon the following terms and conditions, by all of which the Company and the holders of Right Certificates, or, prior to the Distribution Date, Common Shares, by their acceptance thereof, shall be bound:
(a) The Rights Agent may consult with legal counsel selected by it (who may be legal counsel for the Company), and the advice or opinion of such counsel shall be full and complete authorization and protection to the Rights Agent and the Rights Agent shall incur no liability for or in respect of any action taken, suffered or omitted to be taken by it in accordance with such advice or opinion.
(b) Whenever in the performance of its duties under this Agreement the Rights Agent shall deem it necessary or desirable that any fact or matter (including, without limitation, the identity of an Acquiring Person or Affiliate or Associate thereof, and the determination of the current per share market price of any security) be proved or established by the Company prior to taking, suffering or omitting to take any action hereunder, such fact or matter (unless other evidence in respect thereof be herein specifically prescribed) may be deemed to be conclusively proved and established by a certificate signed by a person reasonably believed by the Rights Agent to be any one of the Chairman of the Board, the Chief Executive Officer, the President, any Vice President, the Treasurer, the Secretary or any Assistant Secretary of the Company and delivered to the Rights Agent; and such certificate shall be full and complete authorization and protection to the Rights Agent and the Rights Agent shall incur no liability for or in respect of any action taken, suffered or omitted to be taken by it under the provisions of this Agreement in reliance upon such a certificate.
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(c) The Rights Agent shall be liable hereunder to the Company and any other Person only for its own gross negligence, bad faith or willful misconduct (each as determined by a final, nonappealable judgment of a court of competent jurisdiction). Notwithstanding anything in this Agreement to the contrary, any liability of the Rights Agent under this Agreement will be limited to the amount of annual fees (but not reimbursed fees and charges) paid by the Company to the Rights Agent under this Agreement during the twelve (12) months immediately preceding the event for which recovery from the Rights Agent is being sought. Anything to the contrary notwithstanding, in no event will the Rights Agent be liable for special, punitive, indirect, incidental or consequential loss or damage of any kind whatsoever (including but not limited to lost profits), even if the Rights Agent has been advised of the likelihood of such loss or damage and regardless of the form of action.
(d) The Rights Agent shall not be liable for or by reason of any of the statements of fact or recitals contained in this Agreement or in the Right Certificates (except its countersignature thereof) or be required to verify the same, but all such statements and recitals are and shall be deemed to have been made by the Company only.
(e) The Rights Agent shall not have any liability for or be under any responsibility in respect of the validity of this Agreement or the execution and delivery hereof (except the due execution hereof by the Rights Agent) or in respect of the legality or validity or execution of any Right Certificate (except its countersignature thereof); nor shall it be responsible for any breach by the Company of any covenant or failure by the Company to satisfy any condition contained in this Agreement or in any Right Certificate; nor shall it be liable or responsible for any modification by or order of any court, tribunal, or governmental authority in connection with the foregoing, or any change in the exercisability of the Rights (including the Rights becoming null and void pursuant to Section 11(a)(ii) hereof) or any adjustment or change in the terms of the Rights (including the manner, method or amount thereof) provided for in Sections 3, 11, 13, 23 or 24 hereof, or the ascertaining of the existence of facts that would require any such change or adjustment (except with respect to the exercise of Rights evidenced by Right Certificates after receipt of a certificate pursuant to Section 12 describing such change or adjustment upon which the Rights Agent may rely); nor shall it be responsible for any determination by the Board of Directors of the current market value of the Rights or Preferred Shares or Common Shares pursuant to this Agreement; nor shall it by any act hereunder be deemed to make any representation or warranty as to the authorization or reservation of any Preferred Shares or other securities to be issued pursuant to this Agreement or any Right Certificate or as to whether any Preferred Shares or other securities will, when so issued, be validly authorized and issued, fully paid and nonassessable.
(f) The Company agrees that it will perform, execute, acknowledge and deliver or cause to be performed, executed, acknowledged and delivered all such further and other acts, instruments and assurances as may reasonably be required or requested by the Rights Agent for the carrying out or performing by the Rights Agent of the provisions of this Agreement.
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(g) The Rights Agent is hereby authorized and directed to accept written instructions with respect to the performance of its duties hereunder and certificates delivered pursuant to any provision hereof from any person reasonably believed by the Rights Agent to be one of the Chairman of the Board, the Chief Executive Officer, the President, any Vice President, the Secretary, any Assistant Secretary, the Treasurer or any Assistant Treasurer of the Company, and to apply to such officers for advice or instructions in connection with its duties, and such instructions shall be full authorization and protection to the Rights Agent and it shall not be liable for or in respect of any action taken, suffered or omitted to be taken by it in accordance with written advice or instructions of any such officer or for any delay in acting while waiting for those instructions or advice. The Rights Agent shall be fully authorized and protected in relying upon the most recent advice or instructions received from any such officer. Any application by the Rights Agent for written instructions from the Company may, at the option of the Rights Agent, set forth in writing any action proposed to be taken, suffered or omitted to be taken by the Rights Agent with respect to its duties and obligations under this Agreement and the date on or after which such action shall be taken, suffered or such omission shall be effective. The Rights Agent shall not be liable for any action taken, suffered or omitted to be taken by it in accordance with a proposal included in any such application on or after the date specified therein (which date shall not be less than three Business Days after the date indicated in such application unless any such officer shall have consented in writing to an earlier date) unless, prior to taking, suffering or omitting to take any such action, the Rights Agent has received written instructions from the Company in response to such application specifying the action to be taken, suffered or omitted to be taken. Notwithstanding anything in this Agreement to the contrary, the Rights Agent shall not be required to take any action or to follow any instruction of the Company that the Rights Agent believes, in its sole discretion, would cause the Rights Agent to take action that is illegal.
(h) The Rights Agent and any stockholder, Affiliate, member, director, agent, representative, officer or employee of the Rights Agent may buy, sell or deal in any of the Rights or other securities of the Company or become pecuniarily interested in any transaction in which the Company may be interested, or contract with or lend money to the Company or otherwise act as fully and freely as though it were not Rights Agent under this Agreement. Nothing herein shall preclude the Rights Agent or any stockholder, Affiliate, member, director, agent, representative, officer or employee from acting in any other capacity for the Company or for any other Person.
(i) The Rights Agent may execute and exercise any of the rights or powers hereby vested in it or perform any duty hereunder either itself (through its directors, officers and employees) or by or through its attorneys or agents, and the Rights Agent shall not be answerable or accountable for any act, omission, default, neglect or misconduct of any such attorneys or agents or for any loss to the Company or any other Person resulting from any such act, omission, default, neglect or misconduct, absent gross negligence, bad faith or willful misconduct (as each is determined by a final, nonappealable judgment of a court of competent jurisdiction) in the selection and continued employment thereof.
(j) No provision of this Agreement shall require the Rights Agent to expend or risk its own funds or otherwise incur any financial liability in the performance of any of its duties hereunder or in the exercise of any of its rights or powers if it believes that repayment of such funds or adequate indemnification against such risk or liability is not reasonably assured to it.
(k) The Rights Agent shall have no responsibility to the Company, any holders of Rights or any holders of Common Shares for interest or earnings on any moneys held by the Rights Agent pursuant to this Agreement.
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(l) The Rights Agent shall not be required to take notice or be deemed to have notice of any event or condition hereunder, including any event or condition that may require action by the Rights Agent, unless the Rights Agent shall be specifically notified in writing of such event or condition by the Company, and all notices or other instruments required by this Agreement to be delivered to the Rights Agent must, in order to be effective, be received by the Rights Agent as specified in Section 26 hereof, and in the absence of such notice so delivered, the Rights Agent may conclusively assume no such event or condition exists.
(m) The Rights Agent may rely on and be fully authorized and protected in acting or failing to act upon any guaranty of signature by an “eligible guarantor institution” that is a member or participant in the Securities Transfer Agents Medallion Program or other comparable “signature guarantee program” or insurance program in addition to, or in substitution for, the foregoing.
(n) The Rights Agent shall not have any duty or responsibility in the case of the receipt of any written demand from any holder of Rights with respect to any action or default by the Company, including, without limiting the generality of the foregoing, any duty or responsibility to initiate or attempt to initiate any proceedings at law or otherwise or to make any demand upon the Company; provided that upon the receipt of any such written demand, the Rights Agent shall use reasonable efforts to provide the Company with notice thereof as soon as commercially practicable.
(o) The Rights Agent shall act hereunder solely as agent for the Company. The Rights Agent shall not assume any obligations or relationship of agency or trust with any of the owners or holders of the Rights or other securities of the Company.
Section 21. Change of Rights Agent. The Rights Agent or any successor Rights Agent may resign and be discharged from its duties under this Agreement upon 30 days’ prior notice in writing mailed to the Company and, in the event that the Rights Agent or one of its Affiliates is not also the transfer agent for the Company, to each transfer agent of the Common Shares of the Company or Preferred Shares known to the Rights Agent. In the event the transfer agency relationship in effect between the Company and the Rights Agent terminates, the Rights Agent will be deemed to have resigned automatically and be discharged from its duties under this Agreement as of the effective date of such termination, and the Company shall be responsible for sending any required notice. The Company may remove the Rights Agent or any successor Rights Agent (with or without cause) upon 30 days’ prior notice in writing, mailed to the Rights Agent or successor Rights Agent, as the case may be, and to each transfer agent of the Common Shares of the Company or Preferred Shares by registered or certified mail, and to the holders of the Right Certificates by first-class mail. If the Rights Agent shall resign or be removed or shall otherwise become incapable of acting, the Company shall appoint a successor to the Rights Agent. If the Company shall fail to make such appointment within a period of 30 days after giving notice of such removal or after it has been notified in writing of such resignation or incapacity by the resigning or incapacitated Rights Agent or by the holder of a Right Certificate (which holder shall, with such notice, submit such holder’s Right Certificate for inspection by the Company), then the incumbent Rights Agent or registered holder of any Right Certificate may apply to any court of competent jurisdiction for the appointment of a new Rights Agent. Any successor Rights Agent, whether appointed by the
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Company or by such a court, shall be either (a) a Person, other than a natural Person, organized and doing business under the laws of the United States (or of any state of the United States), in good standing, which is authorized under such laws to exercise stock transfer powers and is subject to supervision or examination by federal or state authority and which has, along with its Affiliates, at the time of its appointment as Rights Agent a combined capital and surplus of at least $50 million or (b) an Affiliate or direct or indirect wholly-owned Subsidiary of such Person or its wholly-owning parent. After appointment, the successor Rights Agent shall be vested with the same powers, rights, duties and responsibilities as if it had been originally named as Rights Agent without further act or deed; but the predecessor Rights Agent shall deliver and transfer to the successor Rights Agent any property at the time held by it hereunder, and execute and deliver any further assurance, conveyance, act or deed necessary for such purpose, but such predecessor Rights Agent shall not be required to make any additional expenditure or assume any additional liability in connection with the foregoing; and, except as the context herein otherwise requires, such successor Rights Agent shall be deemed to be the “Rights Agent” for all purposes of this Agreement. Not later than the effective date of any such appointment, the Company shall file notice thereof in writing with the predecessor Rights Agent and each transfer agent of the Common Shares of the Company or Preferred Shares, and mail a notice thereof in writing to the registered holders of the Right Certificates. Failure to give any notice provided for in this Section 21, however, or any defect therein, shall not affect the legality or validity of the resignation or removal of the Rights Agent or the appointment of the successor Rights Agent, as the case may be.
Section 22. Issuance of New Right Certificates. Notwithstanding any of the provisions of this Agreement or of the Rights to the contrary, the Company may, at its option, issue new Right Certificates evidencing Rights in such form as may be approved by the Board of Directors of the Company to reflect any adjustment or change in the Purchase Price and the number or kind or class of shares or other securities or property purchasable under the Right Certificates made in accordance with the provisions of this Agreement.
Section 23. Redemption.
(a) The Board of Directors of the Company may, at its option, at any time prior to such time as any Person becomes an Acquiring Person, cause the Company to redeem all but not less than all of the then outstanding Rights at a redemption price of $0.001 per Right, appropriately adjusted to reflect any stock split, stock dividend or similar transaction occurring after the date hereof (such redemption price being hereinafter referred to as the “Redemption Price”). The redemption of the Rights by the Board of Directors of the Company may be made effective at such time, on such basis and with such conditions as the Board of Directors of the Company, in its sole discretion, may establish. The Company may, at its option, pay the Redemption Price in cash, Common Shares of the Company (based on the current market price of the Common Shares of the Company at the time of the election by the Board of Directors of the Company to redeem the Rights as determined pursuant to Section 11(d)(i) hereof) or any other form of consideration deemed appropriate by the Board of Directors of the Company.
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(b) Immediately upon the action of the Board of Directors of the Company ordering the redemption of the Rights pursuant to paragraph (a) of this Section 23, and without any further action and without any notice, the right to exercise the Rights will terminate and the only right thereafter of the holders of Rights shall be to receive the Redemption Price. The Company shall promptly give public notice of any such redemption (with prompt written notice thereof to the Rights Agent); provided, however, that the failure to give, or any defect in, any such notice shall not affect the validity of such redemption. Within 10 days after such action of the Board of Directors of the Company ordering the redemption of the Rights, the Company shall mail a notice of redemption to the Rights Agent and all the holders of the then outstanding Rights at their last addresses as they appear upon the registry books of the Rights Agent or, prior to the Distribution Date, on the registry books of the transfer agent for the Common Shares of the Company. Any notice which is mailed in the manner herein provided shall be deemed given, whether or not the holder receives the notice. Each such notice of redemption will state the method by which the payment of the Redemption Price will be made. Neither the Company nor any of its Affiliates or Associates may redeem, acquire or purchase for value any Rights at any time in any manner other than that specifically set forth in this Section 23 or in Section 24 hereof, and other than in connection with the purchase of Common Shares of the Company prior to the Distribution Date.
Section 24. Exchange.
(a) The Board of Directors of the Company may, at its option, at any time after any Person becomes an Acquiring Person, exchange Common Shares of the Company for all or part of the then outstanding and exercisable Rights (which shall not include Rights that have become null and void pursuant to the provisions of Section 11(a)(ii) hereof) at an exchange ratio of one Common Share of the Company per Right, appropriately adjusted to reflect any adjustment in the number of Rights pursuant to Section 11(i) (such exchange ratio being hereinafter referred to as the “Exchange Ratio”). The exchange of the Rights by the Board of Directors may be made effective at such time, on such basis and with such conditions as the Board of Directors may establish. Notwithstanding the foregoing, the Board of Directors of the Company shall not be empowered to effect such exchange at any time after an Acquiring Person becomes the Beneficial Owner of 50% or more of the Common Shares of the Company then outstanding. Prior to effecting an exchange pursuant to this Section 24, the Board of Directors of the Company may direct the Company to enter into a trust agreement in such form and with such terms as the Board of Directors of the Company shall then approve (the “Trust Agreement”). If the Board of Directors of the Company so directs, the Company shall enter into the Trust Agreement and shall issue to the trust created by such agreement (the “Trust”) all of the Common Shares of the Company issuable pursuant to the exchange, and all Persons entitled to receive Common Shares of the Company pursuant to the exchange shall be entitled to receive such Common Shares of the Company (and any dividends or distributions made thereon after the date on which such Common Shares of the Company are deposited in the Trust) only from the Trust and solely upon compliance with the relevant terms and provisions of the Trust Agreement.
(b) Immediately upon the action of the Board of Directors of the Company ordering the exchange of any Rights pursuant to paragraph (a) of this Section 24 and without any further action and without any notice, the right to exercise such Rights shall terminate and the only right thereafter of a holder of such Rights shall be to receive that number of Common Shares of the Company equal to the number of such Rights held by such holder multiplied by the Exchange Ratio. The Company shall promptly give public notice of any such exchange (with prompt written notice thereof to the Rights Agent); provided, however, that the failure to give, or any defect in,
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such notice shall not affect the validity of such exchange. The Company promptly shall mail a notice of any such exchange to the Rights Agent and all of the holders of such Rights at their last addresses as they appear upon the registry books of the Rights Agent. Any notice which is mailed in the manner herein provided shall be deemed given, whether or not the holder receives the notice. Each such notice of exchange will state the method by which the exchange of the Common Shares of the Company for Rights will be effected, and, in the event of any partial exchange, the number of Rights which will be exchanged. Any partial exchange shall be effected pro rata based on the number of Rights (other than Rights which have become null and void pursuant to the provisions of Section 11(a)(ii) hereof) held by each holder of Rights.
(c) In the event that there shall not be sufficient Common Shares of the Company issued but not outstanding or authorized but unissued (after taking into account, at the discretion of the Board of Directors of the Company, any necessary reserves of Common Shares of the Company) to permit the exchange of Rights in accordance with Section 24(a) hereof, the Company shall either (i) take all such action as may be necessary to authorize additional Common Shares of the Company for issuance upon exchange of the Rights or (ii) with respect to each Right (which shall not include Rights that have become null and void pursuant to the provisions of Section 11(a)(ii) hereof), make adequate provision to substitute, for each Common Share of the Company that would otherwise be issuable upon exchange of a Right, (A) a number of Preferred Shares (or fraction thereof) or (B) any combination of Common Shares of the Company and Preferred Shares (or fraction thereof), in any case set forth in (A) or (B) having a value equal to the product of the current per share market price of the Common Shares of the Company times the Exchange Ratio as of the date of issuance of such shares or fraction thereof. For purposes of this Section 24(c), (x) the value of each Common Share of the Company shall be the current per share market price of the Common Shares of the Company (as determined pursuant to Section 11(d) hereof) and (y) the value of each Preferred Share shall be the current per share market price of the Preferred Shares (as determined pursuant to Section 11(d) hereof), in each case as of the date of issuance of such shares or fraction thereof.
(d) The Company shall not be required to issue fractions of Common Shares of the Company or Preferred Shares or to distribute certificates which evidence fractional Common Shares of the Company or Preferred Shares. In lieu of such fractional Common Shares of the Company or Preferred Shares, the Company shall pay to the registered holders of the Right Certificates with regard to which such fractional Common Shares of the Company or Preferred Shares would otherwise be issuable an amount in cash equal to the same fraction of the current market value of a whole Common Share of the Company or Preferred Share. For the purposes of this paragraph (d), the current market value of a whole Common Share of the Company or Preferred Share shall be the closing price of a Common Share of the Company or Preferred Share (as determined pursuant to the second sentence of Section 11(d)(i) hereof) for the Trading Day immediately prior to the date of exchange pursuant to this Section 24.
Section 25. Notice of Certain Events.
(a) In case the Company shall, at any time after the Distribution Date, propose (i) to pay any dividend payable in stock of any class to the holders of the Preferred Shares or to make any other distribution to the holders of the Preferred Shares (other than a regular quarterly cash dividend), (ii) to offer to the holders of the Preferred Shares rights or warrants to subscribe
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for or to purchase any additional Preferred Shares or shares of stock of any class or any other securities, rights or options, (iii) to effect any reclassification of the Preferred Shares (other than a reclassification involving only the subdivision of outstanding Preferred Shares), (iv) to effect any share exchange, consolidation or merger into or with, or to effect any sale or other transfer (or to permit one or more of its Subsidiaries to effect any sale or other transfer), in one or more transactions, of 50% or more of the assets or earning power of the Company and its Subsidiaries (taken as a whole) to, any other Person, (v) to effect the liquidation, dissolution or winding up of the Company, or (vi) to declare or pay any dividend on the Common Shares of the Company payable in Common Shares of the Company or to effect a subdivision, combination or consolidation of the Common Shares of the Company (by reclassification or otherwise than by payment of dividends in Common Shares of the Company), then, in each such case, the Company shall give to the Rights Agent and each holder of a Right Certificate, in accordance with Section 26 hereof, a reasonably detailed notice of such proposed action, which shall specify the record date for the purposes of such stock dividend, or distribution of rights or warrants, or the date on which such share exchange, reclassification, consolidation, merger, sale, transfer, liquidation, dissolution, or winding up is to take place and the date of participation therein by the holders of the Common Shares of the Company and/or Preferred Shares, if any such date is to be fixed, and such notice shall be so given in the case of any action covered by clause (i) or (ii) above at least 10 days prior to the record date for determining holders of the Preferred Shares for purposes of such action, and, in the case of any such other action, at least 10 days prior to the date of the taking of such proposed action or the date of participation therein by the holders of the Common Shares of the Company and/or Preferred Shares, whichever shall be the earlier.
(b) In case the event set forth in Section 11(a)(ii) hereof shall occur, then the Company shall, as soon as practicable thereafter, give to the Rights Agent and to each holder of a Right Certificate, in accordance with Section 26 hereof, a notice of the occurrence of such event, which notice shall describe such event and the consequences of such event to holders of Rights under Section 11(a)(ii) hereof.
Section 26. Notices. Notices or demands authorized by this Agreement to be given or made by the Rights Agent or by the holder of any Right Certificate to or on the Company shall be sufficiently given or made if in writing and sent by overnight delivery service or first-class mail, postage prepaid, properly addressed (until another address is filed in writing with the Rights Agent) as follows:
The Wendy’s Company
One Dave Thomas Blvd.
Dublin, Ohio 43017
Attention: John Min, Chief Legal Officer and Secretary
With an electronic copy to: john.min@wendys.com
Subject to the provisions of Section 21 hereof, any notice or demand authorized by this Agreement to be given or made by the Company or by the holder of any Right Certificate to or on the Rights Agent shall be sufficiently given or made if in writing and sent by overnight delivery service or first-class mail, postage prepaid, properly addressed (until another address is filed in writing with the Company) as follows:
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Equiniti Trust Company, LLC
28 Liberty Street, Floor 53
New York, NY 10005
Attention: Relationship Management
With an electronic courtesy copy (that shall not constitute notice under this Section 26) to:
Equiniti Trust Company, LLC
Attention: Legal Department
Email: legalteamUS@equiniti.com
Notices or demands authorized by this Agreement to be given or made by the Company or the Rights Agent to the holder of any Right Certificate shall be sufficiently given or made if in writing and sent by overnight delivery service or first-class mail, postage prepaid, addressed to such holder at the address of such holder as shown on the registry books of the Company.
Section 27. Supplements and Amendments. Subject to this Section 27, the Company may, and the Rights Agent shall, if directed by the Company, from time to time supplement or amend this Agreement without the approval of any holders of Right Certificates in order to cure any ambiguity, to correct or supplement any provision contained herein which may be defective or inconsistent with any other provisions herein, or to make any other supplements or amendments to any provisions with respect to the Rights, this Agreement or otherwise, which the Company may deem necessary or desirable, any such supplement or amendment to be evidenced by a writing signed by the Company and the Rights Agent; provided, however, that, from and after such time as any Person becomes an Acquiring Person, this Agreement shall not be amended in any manner which would adversely affect the interests of the holders of Rights (which holders will not include, for the avoidance of doubt, an Acquiring Person or any of its Affiliates and Associates). Upon delivery of a certificate from an appropriate officer of the Company that states that the proposed supplement or amendment is in compliance with the terms of this section, the Rights Agent shall execute such supplement or amendment; provided, that notwithstanding anything in this Agreement to the contrary, the Rights Agent may, but shall not be obligated to, enter into any supplement or amendment that affects the Rights Agent’s own rights, duties, obligations or immunities under this Agreement. No supplement or amendment to this Agreement shall be effective unless duly executed by the Rights Agent.
Section 28. Successors. All the covenants and provisions of this Agreement by or for the benefit of the Company or the Rights Agent shall bind and inure to the benefit of their respective successors and assigns hereunder.
Section 29. Benefits of this Agreement. Nothing in this Agreement shall be construed to give to any Person other than the Company, the Rights Agent and the registered holders of the Right Certificates (and, prior to the Distribution Date, the Common Shares of the Company) any legal or equitable right, remedy or claim under this Agreement; but this Agreement shall be for the sole and exclusive benefit of the Company, the Rights Agent and the registered holders of the Right Certificates (and, prior to the Distribution Date, the Common Shares of the Company).
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Section 30. Determinations and Actions by the Board of Directors. The Board of Directors of the Company or a duly authorized committee thereof shall have the power and authority to administer this Agreement and to exercise the rights and powers specifically granted to the Board of Directors of the Company or to the Company, or as may be necessary or advisable in the administration of this Agreement.
Section 31. Severability. If any term, provision, covenant or restriction of this Agreement is held by a court of competent jurisdiction or other authority to be invalid, void or unenforceable, the remainder of the terms, provisions, covenants and restrictions of this Agreement shall remain in full force and effect and shall in no way be affected, impaired or invalidated; provided, however, that if any such excluded term, provision, covenant or restriction shall adversely affect the rights, immunities, liabilities, duties or obligations of the Rights Agent, the Rights Agent shall be entitled to resign immediately.
Section 32. Governing Law. This Agreement, each Right and each Right Certificate issued hereunder shall be deemed to be a contract made under the laws of the State of Delaware and for all purposes shall be governed by and construed in accordance with the laws of such State applicable to contracts to be made and performed entirely within such State, without regard to the principles or rules concerning conflicts of laws which might otherwise require application of the substantive laws of another jurisdiction.
Section 33. Counterparts. This Agreement may be executed in any number of counterparts and each of such counterparts shall for all purposes be deemed to be an original, and all such counterparts shall together constitute but one and the same instrument. A signature to this Agreement transmitted electronically shall have the same authority, effect, and enforceability as an original signature.
Section 34. Descriptive Headings; Interpretation. Descriptive headings of the several sections of this Agreement are inserted for convenience only and shall not control or affect the meaning or construction of any of the provisions hereof. The words “include,” “includes” and “including” shall be deemed to be followed by the phrase “without limitation.” Each reference in this Agreement to a period of time following or after a specified date or event shall be calculated without including such specified date or the day on which such specified event occurs.
Section 35. Force Majeure. Notwithstanding anything to the contrary contained herein, the Rights Agent shall not be liable for any delays or failures in performance resulting from acts beyond its reasonable control including, without limitation, acts of God, pandemics, epidemics, terrorist acts, shortage of supply, breakdowns or malfunctions, interruptions or malfunction of computer facilities, or loss of data due to power failures or mechanical difficulties with information storage or retrieval systems, labor difficulties, war, or civil unrest.
Section 36. Customer Identification Program. The Company acknowledges that the Rights Agent is subject to the customer identification program (“Customer Identification Program”) requirements under the USA PATRIOT Act and its implementing regulations, and that the Rights Agent must obtain, verify and record information that allows the Rights Agent to identify the Company. Accordingly, prior to accepting an appointment hereunder, the Rights Agent may request information from the Company that will help the Rights Agent to identify the
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Company, including without limitation the Company’s physical address, tax identification number, organizational documents, certificate of good standing, license to do business, or any other information that the Rights Agent deems necessary. The Company agrees that the Rights Agent cannot accept an appointment hereunder unless and until the Rights Agent verifies the Company’s identity in accordance with the Customer Identification Program requirements.
[The remainder of this page has been left blank intentionally]
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed and attested, all as of the day and year first above written.
| THE WENDY’S COMPANY | ||
| By: | /s/ John Min | |
| Name: John Min | ||
| Title: Chief Legal Officer and Secretary | ||
[Signature Page to Rights Agreement]
| EQUINITI TRUST COMPANY, LLC, AS RIGHTS AGENT | ||
| By: | /s/ Martin J. Knapp | |
| Name: Martin J. Knapp | ||
| Title: Senior Vice President | ||
[Signature Page to Rights Agreement]
Exhibit A
CERTIFICATE OF DESIGNATIONS
of
SERIES A JUNIOR PARTICIPATING PREFERRED STOCK
of
THE WENDY’S COMPANY
(Pursuant to Section 151 of the
Delaware General Corporation Law)
The Wendy’s Company, a corporation organized and existing under the General Corporation Law of the State of Delaware (hereinafter called the “Corporation”), hereby certifies that the following resolution was adopted by the Board of Directors of the Corporation as required by Section 151 of the General Corporation Law at a meeting duly called and held on November 4, 2026:
RESOLVED, that pursuant to the authority granted to and vested in the Board of Directors of this Corporation (hereinafter called the “Board of Directors” or the “Board”) in accordance with the provisions of the Amended and Restated Certificate of Incorporation of the Corporation, the Board of Directors hereby fixes the relative rights, preferences, and limitations of a series of preferred stock, par value $0.10 per share (the “Preferred Stock”) as follows:
Series A Junior Participating Preferred Stock:
Section 1. Designation and Amount. The shares of such series shall be designated as “Series A Junior Participating Preferred Stock”, par value $0.10 per share (the “Series A Preferred Stock”), and the number of shares constituting the Series A Preferred Stock shall be 200,000. Such number of shares may be increased or decreased by resolution of the Board of Directors; provided, that no decrease shall reduce the number of shares of Series A Preferred Stock to a number less than the number of shares then outstanding plus the number of shares reserved for issuance upon the exercise of outstanding options, rights or warrants or upon the conversion of any outstanding securities issued by the Corporation convertible into Series A Preferred Stock.
A-1
Section 2. Dividends and Distributions.
(A) Subject to the rights of the holders of any shares of any series of Preferred Stock (or any similar stock) ranking prior and superior to the Series A Preferred Stock with respect to dividends, the holders of shares of Series A Preferred Stock, in preference to the holders of Common Stock, par value $0.10 per share (the “Common Stock”), of the Corporation, and of any other junior stock, shall be entitled to receive, when, as and if declared by the Board of Directors out of funds legally available for the purpose, quarterly dividends payable in cash on the first day of March, June, September and December in each year (each such date being referred to herein as a “Quarterly Dividend Payment Date”), commencing on the first Quarterly Dividend Payment Date after the first issuance of a share or fraction of a share of Series A Preferred Stock, in an amount per share (rounded to the nearest cent) equal to the greater of (a) $0.10 or (b) subject to the provision for adjustment hereinafter set forth, 1,000 times the aggregate per share amount of all cash dividends, and 1,000 times the aggregate per share amount (payable in kind) of all non-cash dividends or other distributions, other than a dividend payable in shares of Common Stock or a subdivision of the outstanding shares of Common Stock (by reclassification or otherwise), declared on the Common Stock since the immediately preceding Quarterly Dividend Payment Date or, with respect to the first Quarterly Dividend Payment Date, since the first issuance of any share or fraction of a share of Series A Preferred Stock. In the event the Corporation shall at any time declare or pay any dividend on the Common Stock payable in shares of Common Stock, or effect a subdivision or combination or consolidation of the outstanding shares of Common Stock (by reclassification or otherwise than by payment of a dividend in shares of Common Stock) into a greater or lesser number of shares of Common Stock, then in each such case the amount to which holders of shares of Series A Preferred Stock were entitled immediately prior to such event under clause (b) of the preceding sentence shall be adjusted by multiplying such amount by a fraction, the numerator of which is the number of shares of Common Stock outstanding immediately after such event and the denominator of which is the number of shares of Common Stock that were outstanding immediately prior to such event.
(B) The Corporation shall declare a dividend or distribution on the Series A Preferred Stock as provided in paragraph (A) of this Section immediately after it declares a dividend or distribution on the Common Stock (other than a dividend payable in shares of Common Stock); provided that, in the event no dividend or distribution shall have been declared on the Common Stock during the period between any Quarterly Dividend Payment Date and the next subsequent Quarterly Dividend Payment Date, a dividend of $0.10 per share on the Series A Preferred Stock shall nevertheless be payable on such subsequent Quarterly Dividend Payment Date.
(C) Dividends shall begin to accrue and be cumulative on outstanding shares of Series A Preferred Stock from the Quarterly Dividend Payment Date next preceding the date of issue of such shares, unless the date of issue of such shares is prior to the record date for the first Quarterly Dividend Payment Date, in which case dividends on such shares shall begin to accrue from the date of issue of such shares, or unless the date of issue is a Quarterly Dividend Payment Date or is a date after the record date for the determination of holders of shares of Series A Preferred Stock entitled to receive a quarterly dividend and before such Quarterly Dividend Payment Date, in either of which events such dividends shall begin to accrue and be cumulative from such Quarterly Dividend Payment Date. Accrued but unpaid dividends shall not bear interest.
A-2
(D) Dividends paid on the shares of Series A Preferred Stock in an amount less than the total amount of such dividends at the time accrued and payable on such shares shall be allocated pro rata on a share-by-share basis among all such shares at the time outstanding. The Board of Directors may fix a record date for the determination of holders of shares of Series A Preferred Stock entitled to receive payment of a dividend or distribution declared thereon, which record date shall be not more than 60 days prior to the date fixed for the payment thereof.
Section 3. Voting Rights. The holders of shares of Series A Preferred Stock shall have the following voting rights:
(A) Subject to the provision for adjustment hereinafter set forth, each share of Series A Preferred Stock shall entitle the holder thereof to 1,000 votes on all matters submitted to a vote of the stockholders of the Corporation. In the event the Corporation shall at any time declare or pay any dividend on the Common Stock payable in shares of Common Stock, or effect a subdivision or combination or consolidation of the outstanding shares of Common Stock (by reclassification or otherwise than by payment of a dividend in shares of Common Stock) into a greater or lesser number of shares of Common Stock, then in each such case the number of votes per share to which holders of shares of Series A Preferred Stock were entitled immediately prior to such event shall be adjusted by multiplying such number by a fraction, the numerator of which is the number of shares of Common Stock outstanding immediately after such event and the denominator of which is the number of shares of Common Stock that were outstanding immediately prior to such event.
(B) Except as otherwise provided herein, in any other Certificate of Designations creating a series of Preferred Stock or any similar stock, or by law, the holders of shares of Series A Preferred Stock and the holders of shares of Common Stock and any other capital stock of the Corporation having general voting rights shall vote together as one class on all matters submitted to a vote of stockholders of the Corporation.
(C) Except as set forth herein, or as otherwise provided by law, holders of Series A Preferred Stock shall have no special voting rights and their consent shall not be required (except to the extent they are entitled to vote with holders of Common Stock as set forth herein) for taking any corporate action.
Section 4. Certain Restrictions.
(A) Whenever quarterly dividends or other dividends or distributions payable on the Series A Preferred Stock as provided in Section 2 are in arrears, thereafter and until all accrued and unpaid dividends and distributions, whether or not declared, on shares of Series A Preferred Stock outstanding shall have been paid in full, the Corporation shall not:
(i) declare or pay dividends, or make any other distributions, on any shares of stock ranking junior (either as to dividends or upon liquidation, dissolution or winding up) to the Series A Preferred Stock;
(ii) declare or pay dividends, or make any other distributions, on any shares of stock ranking on a parity (either as to dividends or upon liquidation, dissolution or winding up) with the Series A Preferred Stock, except dividends paid ratably on the Series A Preferred Stock and all such parity stock on which dividends are payable or in arrears in proportion to the total amounts to which the holders of all such shares are then entitled;
A-3
(iii) redeem or purchase or otherwise acquire for consideration shares of any stock ranking junior (either as to dividends or upon liquidation, dissolution or winding up) to the Series A Preferred Stock, provided that the Corporation may at any time redeem, purchase or otherwise acquire shares of any such junior stock in exchange for shares of any stock of the Corporation ranking junior (either as to dividends or upon dissolution, liquidation or winding up) to the Series A Preferred Stock; or
(iv) redeem or purchase or otherwise acquire for consideration any shares of Series A Preferred Stock, or any shares of stock ranking on a parity with the Series A Preferred Stock, except in accordance with a purchase offer made in writing or by publication (as determined by the Board of Directors) to all holders of such shares upon such terms as the Board of Directors, after consideration of the respective annual dividend rates and other relative rights and preferences of the respective series and classes, shall determine will result in fair and equitable treatment among the respective series or classes.
(B) The Corporation shall not permit any subsidiary of the Corporation to purchase or otherwise acquire for consideration any shares of stock of the Corporation unless the Corporation could, under paragraph (A) of this Section 4, purchase or otherwise acquire such shares at such time and in such manner.
Section 5. Reacquired Shares. Any shares of Series A Preferred Stock purchased or otherwise acquired by the Corporation in any manner whatsoever shall be retired and cancelled promptly after the acquisition thereof. All such shares shall upon their cancellation become authorized but unissued shares of Preferred Stock and may be reissued as part of a new series of Preferred Stock subject to the conditions and restrictions on issuance set forth herein, in the Amended and Restated Certificate of Incorporation of the Corporation, or in any other Certificate of Designations creating a series of Preferred Stock or any similar stock or as otherwise required by law.
Section 6. Liquidation, Dissolution or Winding Up. Upon any liquidation, dissolution or winding up of the Corporation, no distribution shall be made (A) to the holders of shares of stock ranking junior (either as to dividends or upon liquidation, dissolution or winding up) to the Series A Preferred Stock unless, prior thereto, the holders of shares of Series A Preferred Stock shall have received the greater of (a) $1,000 per share, plus an amount equal to accrued and unpaid dividends and distributions thereon, whether or not declared, to the date of such payment, or (b) an aggregate amount per share, subject to the provision for adjustment hereinafter set forth, equal to 1,000 times the aggregate amount to be distributed per share to holders of shares of Common Stock, or (B) to the holders of shares of stock ranking on a parity (either as to dividends or upon liquidation, dissolution or winding up) with the Series A Preferred Stock, except distributions made ratably on the Series A Preferred Stock and all such parity stock in proportion to the total amounts to which the holders of all such shares are entitled upon such liquidation, dissolution or winding up. In the event the Corporation shall at any time declare or pay any dividend on the Common Stock payable in shares of Common Stock, or effect a subdivision or combination or consolidation of the outstanding shares of Common Stock (by reclassification or
A-4
otherwise than by payment of a dividend in shares of Common Stock) into a greater or lesser number of shares of Common Stock, then in each such case the aggregate amount to which holders of shares of Series A Preferred Stock were entitled immediately prior to such event under the proviso in clause (A) of the preceding sentence shall be adjusted by multiplying such amount by a fraction the numerator of which is the number of shares of Common Stock outstanding immediately after such event and the denominator of which is the number of shares of Common Stock that were outstanding immediately prior to such event.
Section 7. Consolidation, Merger, etc. In case the Corporation shall enter into any consolidation, merger, combination or other transaction in which the shares of Common Stock are exchanged for or changed into other stock or securities, cash and/or any other property, then in any such case each share of Series A Preferred Stock shall at the same time be similarly exchanged or changed into an amount per share, subject to the provision for adjustment hereinafter set forth, equal to 1,000 times the aggregate amount of stock, securities, cash and/or any other property (payable in kind), as the case may be, into which or for which each share of Common Stock is changed or exchanged. In the event the Corporation shall at any time declare or pay any dividend on the Common Stock payable in shares of Common Stock, or effect a subdivision or combination or consolidation of the outstanding shares of Common Stock (by reclassification or otherwise than by payment of a dividend in shares of Common Stock) into a greater or lesser number of shares of Common Stock, then in each such case the amount set forth in the preceding sentence with respect to the exchange or change of shares of Series A Preferred Stock shall be adjusted by multiplying such amount by a fraction, the numerator of which is the number of shares of Common Stock outstanding immediately after such event and the denominator of which is the number of shares of Common Stock that were outstanding immediately prior to such event.
Section 8. No Redemption. The shares of Series A Preferred Stock shall not be redeemable.
Section 9. Rank. The Series A Preferred Stock shall rank, with respect to the payment of dividends and the distribution of assets, junior to all series of any other class of the Corporation’s Preferred Stock.
Section 10. Amendment. The Amended and Restated Certificate of Incorporation of the Corporation shall not be amended in any manner which would materially alter or change the powers, preferences or special rights of the Series A Preferred Stock so as to affect them adversely without the affirmative vote of the holders of at least two-thirds of the outstanding shares of Series A Preferred Stock, voting together as a single class.
A-5
IN WITNESS WHEREOF, the Corporation has caused this Certificate of Designations to be signed and acknowledged by the undersigned this 5th day of November, 2026.
| Name: John Min Title: Chief Legal Officer and Secretary |
A-6
Exhibit B
Form of Right Certificate
| Certificate No. R-___ | Rights |
NOT EXERCISABLE AFTER NOVEMBER 3, 2027 OR EARLIER IF REDEMPTION OR EXCHANGE OCCURS. THE RIGHTS ARE SUBJECT TO REDEMPTION AT $0.001 PER RIGHT AND TO EXCHANGE ON THE TERMS SET FORTH IN THE AGREEMENT. UNDER CERTAIN CIRCUMSTANCES, AS SET FORTH IN THE AGREEMENT, RIGHTS OWNED BY OR TRANSFERRED TO ANY PERSON WHO IS OR BECOMES AN ACQUIRING PERSON (AS DEFINED IN THE AGREEMENT) AND CERTAIN TRANSFEREES THEREOF SHALL BE NULL AND VOID AND SHALL NO LONGER BE TRANSFERABLE
Right Certificate
THE WENDY’S COMPANY
This certifies that _________________, or registered assigns, is the registered owner of the number of Rights set forth above, each of which entitles the owner thereof, subject to the terms, provisions and conditions of the Rights Agreement, dated as of November 4, 2026 (as it may be amended, supplemented or otherwise modified from time to time, the “Agreement”), between The Wendy’s Company, a Delaware corporation (the “Company”), and Equiniti Trust Company, LLC (or any successor rights agent) (the “Rights Agent”), to purchase from the Company at any time after the Distribution Date (as such term is defined in the Agreement) and prior to 5:00 P.M., New York City time, on November 3, 2027 at the office of the Rights Agent designated for such purpose, or at the office of its successor as Rights Agent, one one-thousandth of a fully paid non-assessable share of Series A Junior Participating Preferred Stock, par value $0.10 per share, of the Company (the “Preferred Shares”), at a purchase price of $37.00 per one one-thousandth of a Preferred Share (the “Purchase Price”), upon presentation and surrender of this Right Certificate with the appropriate Form of Election to Purchase duly completed and executed, accompanied by such documentation as the Rights Agent may reasonably request. The number of Rights evidenced by this Right Certificate (and the number of one one-thousandths of a Preferred Share which may be purchased upon exercise hereof) set forth above, and the Purchase Price set forth above, are the number and Purchase Price as of November 16, 2026, based on the Preferred Shares as constituted at such date. As provided in the Agreement, the Purchase Price and the number of one one-thousandths of a Preferred Share which may be purchased upon the exercise of the Rights evidenced by this Right Certificate are subject to modification and adjustment upon the happening of certain events.
This Right Certificate is subject to all of the terms, provisions and conditions of the Agreement, which terms, provisions and conditions are hereby incorporated herein by reference and made a part hereof and to which Agreement reference is hereby made for a full description of the rights, limitations of rights, obligations, duties and immunities hereunder of the Rights Agent, the Company and the holders of the Right Certificates. Copies of the Agreement are on file at the principal executive offices of the Company and the offices of the Rights Agent. The Company will mail to the holder of this Right Certificate a copy of the Agreement without charge after receipt of a written request therefor.
B-1
This Right Certificate, with or without other Right Certificates, upon surrender at the office or offices of the Rights Agent designated for such purpose, accompanied by such documentation as the Rights Agent may reasonably request, may be exchanged for another Right Certificate or Right Certificates of like tenor and date evidencing Rights entitling the holder to purchase a like aggregate number of Preferred Shares as the Rights evidenced by the Right Certificate or Right Certificates surrendered shall have entitled such holder to purchase. If this Right Certificate shall be exercised in part, the holder shall be entitled to receive upon surrender hereof another Right Certificate or Right Certificates for the number of whole Rights not exercised.
Subject to the provisions of the Agreement, the Rights evidenced by this Right Certificate (i) may be redeemed by the Company at a redemption price of $0.001 per Right or (ii) may be exchanged in whole or in part for Preferred Shares or shares of the Company’s Common Stock, par value $0.10 per share.
No fractional Preferred Shares will be issued upon the exercise or exchange of any Right or Rights evidenced hereby (other than fractions which are integral multiples of one one-thousandth of a Preferred Share, which may, at the election of the Company, be evidenced by depositary receipts), but, in lieu thereof, a cash payment will be made, as provided in the Agreement.
No holder of this Right Certificate shall be entitled to vote or receive dividends or be deemed for any purpose the holder of the Preferred Shares or of any other securities of the Company which may at any time be issuable on the exercise or exchange hereof, nor shall anything contained in the Agreement or herein be construed to confer upon the holder hereof, as such, any of the rights of a stockholder of the Company or any right to vote for the election of directors or upon any matter submitted to stockholders at any meeting thereof, or to give or withhold consent to any corporate action, or to receive notice of meetings or other actions affecting stockholders (except as provided in the Agreement), or to receive dividends or subscription rights, or otherwise, until the Right or Rights evidenced by this Right Certificate shall have been exercised or exchanged as provided in the Agreement.
This Right Certificate shall not be valid or obligatory for any purpose until it shall have been countersigned by an authorized signatory of the Rights Agent.
B-2
WITNESS the facsimile signature of the proper officers of the Company and its corporate seal. Dated as of _______________, 20__.
| Chairman of the Board | ||||
| Attest: |
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| Secretary |
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| Countersigned: |
| EQUINITI TRUST COMPANY, LLC, as Rights Agent |
| By: |
| Name: |
| Title: |
B-3
Form of Reverse Side of Right Certificate
FORM OF ASSIGNMENT
(To be executed by the registered holder if such
holder desires to transfer the Right Certificate.)
FOR VALUE RECEIVED ______________ hereby sells, assigns and
transfers unto
(Please print name and address of transferee)
Rights represented by this Right Certificate, together with all right, title and interest therein, and does hereby irrevocably constitute and appoint _____________ Attorney, to transfer said Rights on the books of the within-named Company, with full power of substitution.
Dated: ___________________
| Signature |
Signature Guaranteed:
Signatures must be guaranteed by a participant in a Medallion Signature Guarantee Program at a guarantee level acceptable to the Company’s Rights Agent. A notary public is not sufficient.
The undersigned hereby certifies that the Rights evidenced by this Right Certificate are not Beneficially Owned by, were not acquired by the undersigned from and are not being assigned to an Acquiring Person or an Affiliate or Associate thereof (each as defined in the Agreement).
| Signature |
B-4
Form of Reverse Side of Right Certificate – continued
FORM OF ELECTION TO PURCHASE
(To be executed if holder desires to exercise
Rights represented by the Right Certificate.)
To: THE WENDY’S COMPANY
The undersigned hereby irrevocably elects to exercise ________________ Rights represented by this Right Certificate to purchase the Preferred Shares issuable upon the exercise of such Rights and requests that certificates for such Preferred Shares be issued in the name of:
Please insert social security or other identifying number:
Please print name and address:
If such number of Rights shall not be all the Rights evidenced by this Right Certificate, a new Right Certificate for the balance remaining of such Rights shall be registered in the name of and delivered to:
Please insert social security or other identifying number:
Please print name and address:
Dated: ___________________
| Signature |
Signature Guaranteed:
Signatures must be guaranteed by a participant in a Medallion Signature Guarantee Program at a guarantee level acceptable to the Company’s Rights Agent. A notary public is not sufficient.
The undersigned hereby certifies that the Rights evidenced by this Right Certificate are not Beneficially Owned by and are not being exercised by or on behalf of a Person who is or was an Acquiring Person or an Affiliate or Associate thereof (each as defined in the Agreement).
| Signature |
B-5
NOTICE
The signature in the Form of Assignment or Form of Election to Purchase, as the case may be, must conform to the name as written upon the face of this Right Certificate in every particular, without alteration or enlargement or any change whatsoever.
In the event the certification set forth above in the Form of Assignment or the Form of Election to Purchase, as the case may be, is not completed, the Company and the Rights Agent will deem the Beneficial Owner of the Rights evidenced by this Right Certificate to be an Acquiring Person or an Affiliate or Associate thereof (each as defined in the Agreement) and such Assignment or Election to Purchase will not be honored.
B-6
Exhibit 10.1
THIRD AMENDMENT TO
THE WENDY’S COMPANY 2010 OMNIBUS AWARD PLAN
This Third Amendment (this “Amendment”) to the Plan (as defined below) is adopted by the Board as of the 4th day of November 2026.
WHEREAS, The Wendy’s Company (the “Company”) has adopted The Wendy’s Company 2010 Omnibus Award Plan, as amended by the First Amendment dated as of April 10, 2015 and the Second Amendment dated as of April 10, 2015 (the “Plan”);
WHEREAS, the Board may amend the Plan pursuant to Section 13(a) of the Plan;
WHEREAS, the Board has determined that it is in the best interests of the Company and its stockholders to amend the Plan as set forth below; and
WHEREAS, this Amendment was approved in all respects at a meeting of the Board held on November 4, 2026, to which all non-employee directors of the Board were invited, and which was attended by a quorum of the Board, including members of the Board constituting a quorum of the Compensation and Human Capital Committee of the Board (the “CHC Committee”) and a quorum of the Performance Compensation Subcommittee of the CHC Committee.
NOW THEREFORE, BE IT RESOLVED, that
| 1. | Section 2(f) of the Plan is hereby amended and restated in its entirety to read as follows: |
“(f) “Change in Control” shall, in the case of a particular Award, unless the applicable Award agreement states otherwise or contains a different definition of “Change in Control,” be deemed to occur upon:
(i) the acquisition by any individual, entity or group (within the meaning of Section 13(d)(3) or 14(d)(2) of the Exchange Act (a “Person”)) of beneficial ownership (within the meaning of Rule 13d-3 promulgated under the Exchange Act) of 50% or more (on a fully diluted basis) of either (A) the then outstanding shares of Stock of the Company, taking into account as outstanding for this purpose such Stock issuable upon the exercise of options or warrants, the conversion of convertible stock or debt, and the exercise of any similar right to acquire such Stock (the “Outstanding Company Common Stock”) or (B) the combined voting power of the then outstanding voting securities of the Company entitled to vote generally in the election of directors (the “Outstanding Company Voting Securities”); provided, however, that for purposes of this Plan, the following acquisitions shall not constitute a Change in Control: (I) any acquisition by the Company or any Affiliate, (II) any acquisition by any employee benefit plan sponsored or maintained by the Company or any Affiliate, (III) any acquisition which complies with clauses (A), (B) and (C) of subsection (v) of this Section 2(f), or (IV) in respect of an Award held by a particular Participant, any acquisition by the Participant or any group of persons including the Participant (or any entity controlled by the Participant or any group of persons including the Participant);
(ii) during any period of twenty-four months, individuals who, at the beginning of such period, constitute the Board (the “Incumbent Directors”) cease for any reason to constitute at least a majority of the Board, provided that any person becoming a director subsequent to the date hereof, whose election or nomination for election was approved by a vote of at least two-thirds of the Incumbent Directors then on the Board (either by a specific vote or by approval of the proxy statement of the Company in which such person is named as a nominee for director, without written objection to such nomination) shall be an Incumbent Director; provided, however, that no individual initially elected or nominated as a director of the Company as a result of an actual or threatened election contest, as such terms are used in Rule 14a-12 of Regulation 14A promulgated under the Exchange Act, with respect to directors or as a result of any other actual or threatened solicitation of proxies or consents by or on behalf of any person other than the Board shall be deemed to be an Incumbent Director;
(iii) the approval by the shareholders of the Company of a plan of complete dissolution or liquidation of the Company;
(iv) the sale, transfer or other disposition of all or substantially all of the business or assets of the Company; or
(v) the consummation of a reorganization, recapitalization, merger, consolidation, statutory share exchange or similar form of corporate transaction involving the Company that requires the approval of the Company’s stockholders, whether for such transaction or the issuance of securities in the transaction (a “Business Combination”), unless immediately following such Business Combination: (A) more than 50% of the total voting power of (x) the entity resulting from such Business Combination (the “Surviving Company”), or (y) if applicable, the ultimate parent entity that directly or indirectly has beneficial ownership of sufficient voting securities eligible to elect a majority of the board of directors (or the analogous governing body) of the Surviving Company (the “Parent Company”), is represented by the Outstanding Company Voting Securities that were outstanding immediately prior to such Business Combination (or, if applicable, is represented by shares into which the Outstanding Company Voting Securities were converted pursuant to such Business Combination), and such voting power among the holders thereof is in substantially the same proportion as the voting power of the Outstanding Company Voting Securities among the holders thereof immediately prior to the Business Combination, (B) no Person (other than any employee benefit plan sponsored or maintained by the Surviving Company or the Parent Company), is or becomes the beneficial owner, directly or indirectly, of 50% or more of the total voting power of the outstanding voting securities eligible to elect members of the board of directors (or the analogous governing body) of the Parent Company (or, if there is no Parent Company, the Surviving Company) and (C) at least a majority of the members of the board of directors (or the analogous governing body) of the Parent Company (or, if there is no Parent Company, the Surviving Company) following the consummation of the Business Combination were Board members at the time of the Board’s approval of the execution of the initial agreement providing for such Business Combination.
For purposes of Section 2(b), “Controlled By” means the direct or indirect possession of the power to direct or cause the direction of the management or policies of any Person (as defined in Section 13(d) or 14(d) of the Exchange Act), whether through the ownership of voting securities, by contract or otherwise.”
| 2. | This Amendment shall be governed by and construed in accordance with the internal laws of the State of Delaware applicable to contracts made and performed wholly within the State of Delaware, without giving effect to the conflict of laws provisions thereof. |
| 3. | Capitalized terms not otherwise defined in this Amendment shall have the meanings set forth in the Plan. Further, except as expressly modified herein, all terms, provisions and conditions of the Plan shall remain in full force and effect. |
IN WITNESS WHEREOF, the undersigned, being authorized by the Board to execute this Amendment in evidence of the adoption of this Amendment by the Board, has executed this Amendment as of the date first written above.
| THE WENDY’S COMPANY | ||
| By: | /s/ John Min | |
| Name: John Min | ||
| Title: Chief Legal Officer and Secretary | ||
Exhibit 10.2
SECOND AMENDMENT TO
THE WENDY’S COMPANY 2020 OMNIBUS AWARD PLAN
This Second Amendment (this “Amendment”) to the Plan (as defined below) is adopted by the Board as of the 4th day of November, 2026.
WHEREAS, The Wendy’s Company (the “Company”) has adopted The Wendy’s Company 2020 Omnibus Award Plan, as amended by the First Amendment dated as of April 1, 2026 (the “Plan”);
WHEREAS, the Board may amend the Plan pursuant to Section 13(a) of the Plan;
WHEREAS, the Board has determined that it is in the best interests of the Company and its stockholders to amend the Plan as set forth below; and
WHEREAS, this Amendment was approved in all respects at a meeting of the Board held on November 4, 2026, to which all non-employee directors of the Board were invited, and which was attended by a quorum of the Board, including members of the Board constituting a quorum of the Compensation and Human Capital Committee of the Board (the “CHC Committee”) and a quorum of the Performance Compensation Subcommittee of the CHC Committee.
NOW THEREFORE, BE IT RESOLVED, that
| 1. | Section 2(f) of the Plan is hereby amended and restated in its entirety to read as follows: |
“(f) “Change in Control” shall, in the case of a particular Award, unless the applicable Award agreement states otherwise, be deemed to occur upon:
(i) the acquisition by any individual, entity or group (within the meaning of Section 13(d)(3) or 14(d)(2) of the Exchange Act (a “Person”)) of beneficial ownership (within the meaning of Rule 13d-3 promulgated under the Exchange Act) of 50% or more (on a fully diluted basis) of either (A) the then outstanding shares of Stock of the Company, taking into account as outstanding for this purpose such Stock issuable upon the exercise of options or warrants, the conversion of convertible stock or debt, and the exercise of any similar right to acquire such Stock (the “Outstanding Company Common Stock”) or (B) the combined voting power of the then outstanding voting securities of the Company entitled to vote generally in the election of directors (the “Outstanding Company Voting Securities”); provided, however, that for purposes of the Plan, the following acquisitions shall not constitute a Change in Control: (I) any acquisition by the Company or any Affiliate, (II) any acquisition by any employee benefit plan sponsored or maintained by the Company or any Affiliate, (III) any acquisition which complies with clauses (A), (B) and (C) of subsection (v) of this Section 2(f), or (IV) in respect of an Award held by a particular Participant, any acquisition by the Participant or any group of persons including the Participant (or any entity controlled by the Participant or any group of persons including the Participant);
(ii) during any period of twenty-four months, individuals who, at the beginning of such period, constitute the Board (the “Incumbent Directors”) cease for any reason to constitute at least a majority of the Board, provided, that any person becoming a director subsequent to the date hereof, whose election or
nomination for election was approved by a vote of at least two-thirds of the Incumbent Directors then on the Board (either by a specific vote or by approval of the proxy statement of the Company in which such person is named as a nominee for director, without written objection to such nomination) shall be an Incumbent Director; provided, however, that no individual initially elected or nominated as a director of the Company as a result of an actual or threatened election contest, as such terms are used in Rule 14a-12 of Regulation 14A promulgated under the Exchange Act, with respect to directors or as a result of any other actual or threatened solicitation of proxies or consents by or on behalf of any person other than the Board shall be deemed to be an Incumbent Director;
(iii) the approval by the shareholders of the Company of a plan of complete dissolution or liquidation of the Company;
(iv) the sale, transfer or other disposition of all or substantially all of the business or assets of the Company; or
(v) the consummation of a reorganization, recapitalization, merger, consolidation, statutory share exchange or similar form of corporate transaction involving the Company that requires the approval of the Company’s stockholders, whether for such transaction or the issuance of securities in such transaction (a “Business Combination”), unless immediately following such Business Combination: (A) more than 50% of the total voting power of (x) the entity resulting from such Business Combination (the “Surviving Company”), or (y) if applicable, the ultimate parent entity that directly or indirectly has beneficial ownership of sufficient voting securities eligible to elect a majority of the board of directors (or the analogous governing body) of the Surviving Company (the “Parent Company”), is represented by the Outstanding Company Voting Securities that were outstanding immediately prior to such Business Combination (or, if applicable, is represented by shares into which the Outstanding Company Voting Securities were converted pursuant to such Business Combination), and such voting power among the holders thereof is in substantially the same proportion as the voting power of the Outstanding Company Voting Securities among the holders thereof immediately prior to the Business Combination, (B) no Person (other than any employee benefit plan sponsored or maintained by the Surviving Company or the Parent Company) is or becomes the beneficial owner, directly or indirectly, of 50% or more of the total voting power of the outstanding voting securities eligible to elect members of the board of directors (or the analogous governing body) of the Parent Company (or, if there is no Parent Company, the Surviving Company) and (C) at least a majority of the members of the board of directors (or the analogous governing body) of the Parent Company (or, if there is no Parent Company, the Surviving Company) following the consummation of the Business Combination were Board members at the time of the Board’s approval of the execution of the initial agreement providing for such Business Combination.
For purposes of Section 2(b) of the Plan, “Controlled By” means the direct or indirect possession of the power to direct or cause the direction of the management or policies of any Person (as defined in Section 13(d) or 14(d) of the Exchange Act), whether through the ownership of voting securities, by contract or otherwise.”
| 2. | This Amendment shall be governed by and construed in accordance with the internal laws of the State of Delaware applicable to contracts made and performed wholly within the State of Delaware, without giving effect to the conflict of laws provisions thereof. |
| 3. | Capitalized terms not otherwise defined in this Amendment shall have the meanings set forth in the Plan. Further, except as expressly modified herein, all terms, provisions and conditions of the Plan shall remain in full force and effect. |
IN WITNESS WHEREOF, the undersigned, being authorized by the Board to execute this Amendment in evidence of the adoption of this Amendment by the Board, has executed this Amendment as of the date first written above.
| THE WENDY’S COMPANY | ||
| By: | /s/ John Min | |
| Name: John Min | ||
| Title: Chief Legal Officer and Secretary | ||
Exhibit 10.3
AMENDMENT TO AWARDS ISSUED BY THE WENDY’S COMPANY
UNDER THE WENDY’S COMPANY 2020 OMNIBUS AWARD PLAN
This Amendment (this “Amendment”) is hereby adopted as of this 4th day of November, 2026 (the “Effective Date”) by The Wendy’s Company (the “Company”) to amend certain outstanding Awards that had been granted under The Wendy’s Company 2020 Omnibus Award Plan (as amended, the “2020 Plan”). This Amendment amends certain outstanding Awards to revise the terms applicable upon a Participant’s termination of employment or service to the Company and its Subsidiaries following a Change in Control (as defined in the 2020 Plan). Capitalized terms used but not defined in this Amendment shall have the meanings given to them in the 2020 Plan.
Recitals:
WHEREAS, pursuant to the 2020 Plan, the Board may, in its sole discretion, at any time and from time to time, administer the Plan with respect to Awards and, in such case, the Board shall have all the authority granted to the Compensation and Human Capital Committee of the Board (the “CHC Committee”) and the Performance Compensation Subcommittee of the CHC Committee under the Plan;
WHEREAS, the Board wishes to amend certain terms of certain outstanding Awards, as permitted by Section 13(b) of the 2020 Plan, pursuant to this Amendment; and
WHEREAS, this Amendment was approved in all respects at a meeting of the Board held on November 4, 2026, to which all non-employee directors of the Board were invited, and which was attended by a quorum of the Board, including members of the Board constituting a quorum of the CHC Committee and a quorum of the Performance Compensation Subcommittee of the CHC Committee.
NOW, THEREFORE, the Company amends certain terms of certain outstanding Awards, as permitted by Section 13(b) of the 2020 Plan, as follows:
1. Amendment of Section 5 of the Long-Term Performance Unit Award Agreement for the December 30, 2024 to January 2, 2028 Performance Period. Section 5 of the Long-Term Performance Unit Award Agreement for the December 30, 2024 to January 2, 2028 Performance Period is hereby amended by deleting the same in their entirety and substituting therefor the following:
(a) In the event a Change in Control occurs during the Performance Period, then immediately before such Change in Control, any unvested outstanding Units shall be converted (without proration for the percentage of the Performance Period that has elapsed) into time-based restricted stock units (vesting on the last day of the Performance Period); provided, that the number of Units that shall be converted into time-based restricted stock units shall be based on (i) with respect to each of Global Systemwide Sales Growth and Global Company-Operated Restaurant Margin Acceleration, (A) actual performance through the end of the applicable measurement period specified in this Agreement with respect to the applicable Performance Goal, for any such completed measurement period as of the Change in Control and (B) the greater of actual performance through the date of the Change in Control and Target performance, for any measurement period specified in this Agreement with respect to the applicable Performance Goal that has not been completed as of the Change in Control and (ii) with respect to the Company TSR Percentile Ranking, actual performance through the date of the Change in Control (or, if earlier, the end of the applicable Performance Period), in each case, as determined by the Committee. If, to the extent applicable, such time-based restricted stock units are not assumed or replaced by the acquirer/continuing entity in connection with such Change in Control on terms deemed by the Committee to be substantially equivalent, then all such time- based restricted stock units shall vest (and the restrictions thereon shall lapse) on the date of the Change in Control and shall be paid out to the Participant in shares of Common Stock as soon as practicable following the Committee’s determination, but in no event later than seventy-four (74) days following the last day of the calendar year in which the Change in Control occurred. Any such determination(s) by the Committee shall be final and binding on all parties, absent manifest error.
(b) In the event the Participant’s employment or service to the Company and its Subsidiaries is terminated prior to the end of the Performance Period by the Company or its Subsidiaries other than for Cause (and other than due to death or Disability), or by the Participant for Good Reason, in each case following a Change in Control, then the Participant shall become fully vested in the time-based restricted stock units received pursuant to Section 5(a) above and the restrictions thereon shall immediately lapse as of the date of such termination of employment or service. The restricted stock units earned in accordance with the foregoing shall be paid out to the Participant in shares of Common Stock as soon as practicable following the Committee’s determination, but in no event later than seventy-four (74) days following the last day of the calendar year in which the termination of employment occurred.
2. Amendment of Section 4 of the Long-Term Performance Unit Award Agreements for the December 29, 2025 to December 31, 2028 Performance Period. Section 4 of the Long-Term Performance Unit Award Agreement for the December 29, 2025 to December 31, 2028 Performance Period is hereby amended by deleting the same in their entirety and substituting therefor the following:
(a) In the event a Change in Control occurs during the Performance Period, then immediately before such Change in Control, any unvested outstanding Units shall be converted (without proration for the percentage of the Performance Period that has elapsed) into time-based restricted stock units (vesting on the last day of the Performance Period); provided, that the number of Units that shall be converted into time-based restricted stock units shall be based on (i) with respect to Global Systemwide Sales Growth, (A) actual performance through the end of the applicable measurement period specified in this Agreement with respect to such Performance Goal, for any such completed measurement period as of the Change in Control and (B) the greater of actual performance through the date of the Change in Control and Target performance, for any measurement period specified in this Agreement with respect to such Performance Goal that has not been completed as of the Change in Control and (ii) with respect to the Company TSR Percentile Ranking, actual performance through the date of the Change in Control (or, if earlier, the end of the applicable Performance Period), in each case, as determined by the Committee. If, to the extent applicable, such time-based restricted stock units are not assumed or replaced by the acquirer/continuing entity in connection with such Change in Control on terms deemed by the Committee to be substantially equivalent, then all such time-based restricted stock units shall vest (and the restrictions thereon shall lapse) on the date of the Change in Control, the Award shall terminate pursuant to Treasury Regulation section 1.409A-3(j)(4)(ix)(B) (and all other arrangements that are consequently required to terminate under Treasury Regulation section 1.409A-3(j)(4)(ix)(B) shall also terminate) and the Award (and all other arrangements terminating pursuant to Treasury Regulation section 1.409A-3(j)(4)(ix)(B)) shall be paid out to the Participant as soon as practicable following the Committee’s determination, but in no event later than seventy-four (74) days following the last day of the calendar year in which the Change in Control occurred (or, if earlier, 12 months following the Change in Control Event). Any such determination(s) by the Committee shall be final and binding on all parties, absent manifest error.
(b) In the event the Participant’s employment or service to the Company and its Subsidiaries is terminated prior to the end of the Performance Period by the Company or its Subsidiaries other than for Cause (and other than due to death or Disability), or by the Participant for Good Reason, in each case following a Change in Control, then the Participant shall become fully vested in all the time-based restricted stock units received pursuant to Section 4(a) above and the restrictions thereon shall immediately lapse as of the date of such termination of employment or service. The restricted stock units earned in accordance with the foregoing shall be paid out to the Participant in shares of Common Stock as soon as practicable following the Committee’s determination, but in no event later than seventy-four (74) days following the Participant’s separation from service (subject to the six-month delay required by Section 14(t)(ii) of the Plan, if the Participant is a “specified employee” at the time of separation); provided, however, that if the Participant’s separation from service occurs more than two years after the Change in Control, or if the Change in Control is not a change in the ownership or effective control of the Company within the meaning of Section 409A(a)(2)(A)(v) of the Code, payment shall be made at the time prescribed by Section 3(c) above.
2
3. Amendment to Post-Change in Control Protection Period. Notwithstanding anything to the contrary in any award agreement evidencing outstanding Awards (other than Awards issued pursuant to any Long-Term Performance Unit Award Agreement, “Performance Units”, or any Awards issued to any non-employee directors) or the 2020 Plan, in the event of the termination of the Participant’s employment or service to the Company and its Subsidiaries by the Company other than for Cause (and other than due to death or Disability), or by the Participant for Good Reason, in each case, within eighteen (18) months following a Change in Control, all the Participant’s outstanding Awards (other than Performance Units) shall be fully vested. This provision shall not apply to Performance Units, which are addressed in Sections 1 and 2 of this Amendment, or any Awards issued to any non-employee directors.
[Remainder of page intentionally left blank.]
3
IN WITNESS WHEREOF, the Company has caused this Amendment to be executed by its duly authorized officer, to be effective as of the Effective Date.
| THE WENDY’S COMPANY | ||
| By: | /s/ John Min | |
| Printed Name: John Min | ||
| Title: Chief Legal Officer and Secretary | ||
Exhibit 10.4
Executive Severance Pay Policy
As Amended: November 4, 2026
I. Policy
It is the policy of Wendy’s International, LLC (“Wendy’s”) to provide post-termination compensation as described in this Policy to certain executives (i) whose employment has been involuntarily terminated without Cause or (ii) who resign for Good Reason within 18 months following a Change in Control (as such capitalized terms are defined in The Wendy’s Company 2020 Omnibus Award Plan (as amended from time to time, the “2020 Plan”)). References in this Policy to Wendy’s also include Wendy’s successors or assigns (by operation of law or otherwise) and Wendy’s parents, affiliates or subsidiaries.
Although this Policy reflects Wendy’s general intent, it does not constitute a plan document or binding contract, and Wendy’s can vary from this Policy at any time and for any lawful reason. Any payments or benefits provided under this Policy are paid in the sole discretion of Wendy’s. This Policy may be modified, amended or terminated at any time and for any lawful reason, without notice, and at the sole discretion of Wendy’s.
II. Effect of November 4, 2026 and February 16, 2023 Amendments
This Policy was amended, effective November 4, 2026, to (i) provide that a resignation for Good Reason within 18 months following a Change in Control will be treated as an involuntary termination without Cause and (ii) extend the period following a Change in Control during which enhanced payments and benefits apply from 12 months to 18 months. The November 4, 2026 amendments apply to all Executives (as defined below), including Executives eligible to receive post-termination compensation under Appendix A.
This Policy was previously amended, effective February 16, 2023. Any Wendy’s U.S. executive in the position of Executive on or before February 15, 2023 will be eligible to receive post-termination compensation as described in the “Payment Upon Involuntary Termination Without Cause” provisions of the December 14, 2015 version of the Policy, as amended and attached hereto as Appendix A, with this Policy (including the February 16, 2023 amendments) otherwise applying. For all other Executives, this Policy (including the February 16, 2023 amendments) will apply.
III. Eligibility
This Policy applies to Wendy’s U.S. executives who, at the time of termination hold the position of senior vice president or higher (which includes all U.S. executives who are deemed to be an “executive officer” of Wendy’s for purposes of Section 16 of the Securities Exchange Act of 1934, as amended, hereinafter a “Section 16 Officer”) and who are not subject to an agreement that otherwise provides for severance payments upon termination (each, an “Executive” and, collectively, the “Executives”). As used in this Policy, any reference to “Executive” includes a Wendy’s U.S. executive who holds the position of Chief Executive Officer (“CEO”) if such individual is an “Executive” as defined in this Policy, unless different treatment is specifically provided in this Policy for a CEO.
An Executive will be eligible for the payments and benefits under this Policy if the Executive is involuntarily terminated without Cause or, within 18 months following a Change in Control, resigns for Good Reason. For all purposes of this Policy (including, for the avoidance of doubt, Appendix A), any such resignation for Good Reason within 18 months following a Change in Control will be treated as an involuntary termination without Cause. Payments and benefits under this Policy are contingent upon the Executive’s continued, active employment with Wendy’s (except to the extent that the Executive is on an approved leave of absence in accordance with Wendy’s policies) until the date designated by Wendy’s (or, in the case of a resignation for Good Reason within 18 months following a Change in Control, the effective date of such resignation) (the “Termination Date”). If an Executive is terminated for Cause before the Termination Date, the Executive will not be entitled to payments or benefits under this Policy. The payment of any severance and other benefits described herein is also contingent upon the Executive’s execution and non-revocation of a Wendy’s form severance agreement, which includes, among other things, a release of claims, non-competition provisions and non-solicitation provisions.
Such documentation must be executed and returned on a date specified by Wendy’s, which will be no later than 45 days after the Termination Date.
An Executive’s employment will not be considered terminated for purposes of this Policy if:
| • | On or before the Termination Date, Wendy’s offers to place the Executive in a comparable position, considering factors such as position title, base salary, annual and long-term incentive compensation, requirements to relocate and scope of responsibility. The determination of whether a position is comparable will be at Wendy’s sole discretion; or |
| • | On or before the Termination Date, the Executive is offered and accepts a position with Wendy’s, regardless of whether the position is considered comparable, as described above. |
An Executive’s entitlement to receive payments and benefits under this Policy will terminate effective upon the Executive’s reemployment, in any capacity, by Wendy’s.
IV. Payment upon Involuntary Termination without Cause
In the event an Executive is involuntarily terminated without Cause (including, as provided in Section III, a resignation for Good Reason within 18 months following a Change in Control), the Compensation and Human Capital Committee and Performance Compensation Subcommittee of the Board of Directors of The Wendy’s Company have approved the following:
A. Salary Continuation
Base salary, as of the Executive’s Termination Date, will be payable in biweekly installments for a period of (i) 12 months for an Executive; or (ii) 24 months for a CEO. However, if the involuntary termination without Cause occurs within 18 months following a Change in Control, as defined in the 2020 Plan, Salary Continuation will instead be calculated as the sum of base salary and target annual cash incentive, as of the Executive’s Termination Date, and that amount will be payable in biweekly installments for a period of (i) 12 months for an Executive; or (ii) 24 months for a CEO.
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B. Annual Cash Incentive
An Annual Cash Incentive for the year of the Executive’s termination will be paid on a pro rata basis, based on the number of months worked prior to the Executive’s Termination Date (or such other pro ration methodology set forth in the applicable incentive plan document). These payments will be calculated based upon actual performance for the entire performance period and will be payable to terminated Executives at the same time that such payments are made to active Executives, in each case subject to the terms and conditions of the applicable plan.
C. Long-Term Incentive
In the event an Executive is involuntarily terminated without Cause, such Executive will be entitled to the following treatment of outstanding equity, unless the terms of the applicable award agreement are more favorable.
| • | Stock Options. Accelerated vesting of outstanding stock options on a pro rata basis through the Termination Date. All other unvested stock options outstanding as of the Termination Date will be forfeited. Vested stock options will be exercisable for ninety (90) days following the Termination Date, or until the grant expiration date, whichever is first. |
| • | Restricted Stock and Restricted Stock Units. Accelerated vesting of outstanding restricted stock and restricted stock units on a pro rata basis through the Termination Date. All other unvested restricted stock or restricted stock units outstanding as of the Termination Date will be forfeited. |
| • | Performance Units. Vesting of outstanding performance units on a pro rata basis, based on the number of months worked prior to the Termination Date. Vesting will occur at the conclusion of the applicable performance period(s), based on actual performance for the entire performance period(s). |
However, if the involuntary termination without Cause occurs within 18 months following a Change in Control, an Executive will instead be entitled to the following treatment of outstanding equity, unless the terms of the applicable award agreement are more favorable.
| • | Stock Options. Accelerated, full vesting of outstanding stock options as of the Termination Date. Vested stock options will be exercisable for one year following the Termination Date, or until the grant expiration date, whichever is first. |
| • | Restricted Stock and Restricted Stock Units. Accelerated, full vesting of outstanding restricted stock and restricted stock units as of the Termination Date. |
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| • | Performance Units. Vesting of outstanding performance units will be as set forth in the applicable performance unit award agreement. |
V. Method and Timing of Payment
Except as otherwise stated herein, all Salary Continuation payments will commence as soon as practical following the Executive’s Termination Date, but in no event will any payments be made prior to the date that the Executive’s severance agreement becomes effective. All payments will be subject to applicable tax withholding.
If any payments under this Policy are subject to Section 409A of the Internal Revenue Code, then (i) each such payment will be treated as a separate payment for purposes of Section 409A, (ii) any such payments that would otherwise be paid in the first six months following the termination of employment of a “specified employee” will be delayed and paid in a lump sum upon the six month anniversary of the termination of employment, with the remaining scheduled installments commencing at that time, and (iii) if the date on which the release of claims is signed could determine whether any payments subject to Section 409A are paid in one of two tax years, then such payments will be paid in the later tax year. A “specified employee” is generally one of the 50 highest-paid officers of Wendy’s, as determined in accordance with procedures adopted by Wendy’s.
For purposes of calculating the applicable Salary Continuation period, references to months shall be calculated based on the closest full week equivalent (e.g., 12 months equals 52 weeks).
For purposes of calculating the proration of any Long-Term Incentive compensation under this Policy, the proration will be based on full calendar months.
VI. Impact on Benefits
Executives whose employment has been terminated without Cause (including, as provided in Section III, a resignation for Good Reason within 18 months following a Change in Control) will continue to receive health and welfare benefits as described below to the extent permitted by applicable law and the relevant plan terms.
A. Health Coverage
Following the Termination Date, former Executives may continue to participate in Wendy’s medical, prescription drug, vision and dental benefits under The Wendy’s Company’s Health Plan at employee premium rates (and Wendy’s will contribute to the Executive’s Health Savings Account or credit the Executive’s Health Reimbursement Account, as applicable) until the earliest of: (i) the day on which the final Salary Continuation payment is received; (ii) the day the Executive becomes covered under any other group health plan; or (iii) the first day the Executive is eligible to participate as an employee under another employer’s health plan. If the Executive becomes eligible to participate as an employee or enrolls under any other group health plan while receiving Salary Continuation payments, the Executive must notify Wendy’s Benefits Department.
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B. Medical Flexible Spending Accounts
The Executive may continue to participate in medical flexible spending accounts until the earlier of (i) the last day on which the Executive receives a Salary Continuation payment or (ii) December 31 on or after the Executive’s Termination Date.
C. COBRA
When an Executive’s medical, dental, prescription, vision, Health Reimbursement Account, and medical flexible spending account coverage end, the Executive may become eligible for COBRA continuation coverage.
D. Other Benefits
Eligibility for all other benefits will end upon the Executive’s Termination Date. These benefits include, but are not limited to, short term disability benefits, paid leave, worker’s compensation benefits (other than claims that arose prior to the Termination Date), life insurance, dependent care flexible spending account contributions and company or employee contributions to retirement plans.
E. Outplacement
Wendy’s, in its sole discretion, may provide career transition and job outplacement services to Executives affected under this Policy. Specifics of the package applicable to each affected Executive will be provided on or about the Executive’s Termination Date.
VII. General Provisions
Determinations with respect to payments and benefits provided under this Policy to Section 16 Officers will be made by the Compensation and Human Capital Committee or Performance Compensation Subcommittee of the Board of Directors of The Wendy’s Company. Wendy’s Chief People Officer will otherwise be responsible for administering this Policy, and the Compensation and Human Capital Committee and Performance Compensation Subcommittee hereby delegates responsibility for implementation and execution of this Policy to Wendy’s Chief People Officer.
Payments and benefits provided under this Policy are subject to any “clawback” or “forfeiture” policies maintained by Wendy’s from time to time, as well as any “clawback” or “forfeiture” provisions to which Wendy’s and/or the Executives may be subject under applicable laws, rules, regulations or stock exchange listing standards (whether such policies were in effect as of the date hereof or adopted by Wendy’s after the date hereof).
In the event it is determined that an Executive is or will be subject to the excise tax imposed by Section 4999 of the Internal Revenue Code, the total payments made to the Executive pursuant to this Policy or otherwise made by Wendy’s will be reduced to the maximum amount that could be paid to the Executive without giving rise to any such excise tax, but only if the Executive would receive a greater after-tax amount after reducing such payments. The reduction of payments, if applicable, will first be made from cash payments in reverse chronological order, then from the accelerated vesting of equity awards in order of the highest ratio of “parachute payment” value to economic value, and then from any remaining payments in reverse chronological order. All determinations under this paragraph will be made by Wendy’s in its sole discretion and will be final and binding on the Executive.
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Notwithstanding anything to the contrary set forth herein, upon a Change in Control, this Policy will become a legally binding obligation of Wendy’s and, for 18 months following the Change in Control, this Policy may not be amended in any way that would have a material adverse effect on an Executive’s eligibility, level of benefits, or other rights under this Policy.
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Appendix A
December 14, 2015 Provisions (as amended on November 4, 2026)
Payment upon Involuntary Termination without Cause
In the event an Executive is involuntarily terminated without Cause (including, as provided in Section III of this Policy, a resignation for Good Reason within 18 months following a Change in Control), the Compensation and Human Capital Committee and Performance Compensation Subcommittee of the Board of Directors of The Wendy’s Company have approved the following:
A. Salary Continuation
Base salary, as of the Executive’s Termination Date, will be payable in biweekly installments for a period of 18 months. However, if the involuntary termination without Cause occurs within 18 months following a Change in Control, as defined in The Wendy’s Company’s 2020 Omnibus Award Plan, Salary Continuation will instead be calculated as the sum of base salary and target annual cash incentive, as of the Executive’s Termination Date, and that amount will be payable in biweekly installments for a period of 18 months.
B. Annual Cash Incentive
An Annual Cash Incentive for the year of the Executive’s termination will be paid on a pro rata basis, based on the number of months worked prior to the Executive’s Termination Date (or such other pro ration methodology set forth in the applicable incentive plan document). These payments will be calculated based upon actual performance for the entire performance period and will be payable to terminated Executives at the same time that such payments are made to active Executives, in each case subject to the terms and conditions of the applicable plan.
C. Long-Term Incentive
In the event an Executive is involuntarily terminated without Cause, such Executive will be entitled to the following treatment of outstanding equity, unless the terms of the applicable award agreement are more favorable.
| • | Stock Options. Continued vesting of outstanding stock options during the Salary Continuation period. Any unvested stock options remaining outstanding as of the conclusion of the Salary Continuation period will be forfeited. Vested stock options will be exercisable for one year following the conclusion of the Salary Continuation period, or until the grant expiration date, whichever is first. |
| • | Restricted Stock and Restricted Stock Units. Accelerated vesting, as of the Termination Date, of outstanding restricted stock and restricted stock units that would have vested had the Executive continued in active employment through the end of the Salary Continuation Period. All other unvested restricted stock or restricted stock units will be forfeited. |
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| • | Performance Units. Vesting of outstanding performance units on a pro rata basis, based on the number of months worked prior to the Executive’s Termination Date. Vesting will occur at the conclusion of the applicable performance period(s), based on actual performance for the entire Performance Period(s). |
However, if the involuntary termination without Cause occurs within 18 months following a Change in Control, an Executive will instead be entitled to the following treatment of outstanding equity, unless the terms of the applicable award agreement are more favorable.
| • | Stock Options. Accelerated, full vesting of outstanding stock options as of the Termination Date. Vested stock options will be exercisable for one year following the Termination Date, or until the grant expiration date, whichever is first. |
| • | Restricted Stock and Restricted Stock Units. Accelerated, full vesting of outstanding restricted stock and restricted stock units as of the Termination Date. |
| • | Performance Units. Vesting of outstanding performance units will be as set forth in the applicable performance unit award agreement. |
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EXHIBIT 10.5
NONQUALIFIED STOCK OPTION AWARD AGREEMENT
UNDER THE WENDY’S COMPANY
2020 OMNIBUS AWARD PLAN
_______________ Shares of Common Stock
THIS NONQUALIFIED STOCK OPTION AWARD AGREEMENT (this “Agreement”) is made as of ____________, 20___, by and between The Wendy’s Company (the “Company”) and __________________ (the “Optionee”).
The Company, pursuant to the provisions of The Wendy’s Company 2020 Omnibus Award Plan (the “Plan”), hereby irrevocably grants to the Optionee the right and option (the “Option”) to purchase _______________ shares of Common Stock, par value $0.10 per share (the “Common Stock”), of the Company upon and subject to the following terms and conditions:
1. The Option is not intended to qualify as an incentive stock option under the provisions of Section 422 of the Internal Revenue Code of 1986, as amended (the “Code”).
2. ____________, 20___ is the date of grant of the Option (the “Date of Grant”).
3. The purchase price of the shares of Common Stock subject to the Option shall be $________ per share (the “Exercise Price”), which is the Fair Market Value on the Date of Grant, as determined by the Committee.
4. Subject to the Optionee’s continued provision of services to the Company, the Option shall be exercisable as follows:
(a) One-third of the shares of Common Stock subject to the Option shall be exercisable on or after the first anniversary of the Date of Grant;
(b) One-third of the shares of Common Stock subject to the Option shall be exercisable on or after the second anniversary of the Date of Grant; and
(c) One-third of the shares of Common Stock subject to the Option shall be exercisable on or after the third anniversary of the Date of Grant.
Notwithstanding the foregoing, in the event the Optionee’s employment or service to the Company and its Subsidiaries is terminated, the Option shall vest and become exercisable as follows:
(i) Change in Control, Death or Disability. The Options shall become fully (100%) and immediately vested upon a termination of employment or service: (A) by the Company or its Subsidiaries other than for Cause (and other than due to death or Disability) within eighteen (18) months following a Change in Control; (B) by the Optionee for Good Reason within eighteen (18) months following a Change in Control; (C) as a result of the Optionee’s death; or (D) due to the Optionee’s Disability;
(ii) Severance. If (A) the Optionee is subject to an employment letter with the Company or its Subsidiaries, is in a class of employees subject to the Company’s Executive Severance Pay Policy, or is in a class of employees subject to another severance policy adopted by the Company or its Subsidiaries, (B) such employment letter or policy addresses the treatment of Options and (C) the Optionee is terminated without Cause (other than in connection with a Change in Control, death or Disability as set forth in clause (i) above), the Options shall vest and become exercisable as set forth under such employment letter or policy, as applicable; and
(iii) Retirement. In the event of the Optionee’s Retirement (as defined below), the Optionee will continue to vest in the Options according to the vesting schedule set forth in this Section 4 as if the Optionee remained employed on each applicable vesting date. For purposes of these Options, “Retirement” shall mean the Optionee’s voluntary termination of the Optionee’s employment or service with the Company and its Subsidiaries at a time that Cause does not exist (A) after attaining age sixty (60), (B) after having at least ten (10) years of employment or service with the Company or its Subsidiaries, (C) as of a date specified (or such other date as agreed to by the Company) in a written notice of proposed Retirement provided by the Optionee to the Company at least six (6) months before the proposed Retirement date and (D) Optionee otherwise complying with the Company’s then-current retirement policy.
5. The unexercised portion of the Option shall automatically and without notice terminate and become null and void at the earlier of (i) the tenth anniversary of the Date of Grant (the “Option Period”) and (ii) the earliest applicable time set forth below:
(a) Termination for Cause. In the event the Optionee’s employment or service to the Company and its Subsidiaries is terminated by the Company or its Subsidiaries for Cause, all outstanding Options granted to the Optionee shall immediately terminate and expire;
(b) Death, Disability or Change in Control. In the event the Optionee’s employment or service to the Company and its Subsidiaries is terminated by the Company or its Subsidiaries due to the Optionee’s death, Disability or without Cause within eighteen (18) months after a Change in Control or by the Optionee for Good Reason within eighteen (18) months after a Change in Control, each outstanding vested Option shall remain exercisable for one (1) year thereafter (but in no event beyond the expiration of the Option Period);
(c) Severance. Unless otherwise provided by the Committee, in the event the Optionee’s employment or service to the Company and its Subsidiaries is terminated by the Company or its Subsidiaries other than for Cause (and other than in connection with death, Disability or a Change in Control as described in Section 4 above):
(i) if the Optionee is subject to an employment letter with the Company or its Subsidiaries, is in a class of employees subject to the Company’s Executive Severance Pay Policy or is in a class of employees subject to another severance policy adopted by the Company or its Subsidiaries, and such employment letter or policy addresses the treatment of Options, the Options shall be exercisable for the greater of ninety (90) days and the period as set forth under such employment letter or policy (but in no event beyond the expiration of the Option Period); or
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(ii) if the Optionee is not in a class of employees described in Section 5(c)(i), each outstanding vested Option shall remain exercisable for ninety (90) days after the termination date (but in no event beyond the expiration of the Option Period);
(d) Retirement. Unless otherwise provided by the Committee, in the event of the Optionee’s Retirement (as defined in Section 4(c) above), each outstanding Option shall remain exercisable for the remainder of the Option Period (but in no event may an outstanding Option be exercised before its applicable vesting date); and
(e) Other Termination. Unless otherwise provided by the Committee, in the event the Optionee’s employment or service to the Company and its Subsidiaries is terminated for any other reason not stated in Section 5(a), (b), (c) or (d) above, and after taking into account any accelerated vesting under Section 4 above, each outstanding unvested Option granted to the Optionee shall immediately terminate and expire, and each outstanding vested Option shall remain exercisable for ninety (90) days thereafter (but in no event beyond the expiration of the Option Period).
6. Options which have become exercisable may be exercised by the Optionee, subject to the provisions of the Plan and this Agreement, as to all or part of the shares of Common Stock covered hereby, by the giving of written or electronic notice of such exercise to the Company at its principal business office (or telephonic instructions to the extent permitted by the Committee), accompanied by payment of the full purchase price for the shares being purchased. No shares of Common Stock shall be delivered pursuant to any exercise of an Option until payment in full of the Exercise Price therefor is received by the Company and the Optionee has paid to the Company an amount equal to any Federal, state, local and non-U.S. income and employment taxes required to be withheld. The Exercise Price shall be payable: (a) in cash, check, cash equivalent and/or shares of Common Stock valued at Fair Market Value at the time the Option is exercised (including, pursuant to procedures approved by the Committee, by means of attestation of ownership of a sufficient number of shares of Common Stock in lieu of actual delivery of such shares to the Company), provided that such shares of Common Stock are not subject to any pledge or other security interest; or (b) by such other method as the Committee may permit in its sole discretion, including without limitation: (i) in other property having a Fair Market Value on the date of exercise equal to the Exercise Price; (ii) if there is a public market for the shares of Common Stock at such time, by means of a broker-assisted “cashless exercise” pursuant to which the Company is delivered (including telephonically to the extent permitted by the Committee) a copy of irrevocable instructions to a stockbroker to sell the shares of Common Stock otherwise deliverable upon the exercise of the Option and to deliver promptly to the Company an amount equal to the Exercise Price; or (iii) a “net exercise” procedure effected by withholding the minimum number of shares of Common Stock otherwise deliverable in respect of an Option that are needed to pay the Exercise Price and all applicable required withholding taxes. Any fractional shares of Common Stock shall be settled in cash.
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The Company shall cause certificates for the shares so purchased to be delivered to or registered (and held in book entry form) in the name of the Optionee or the Optionee’s executors or administrators, against payment of the purchase price, as soon as practicable following the Company’s receipt of the notice of exercise.
7. Neither the Optionee nor the Optionee’s executors or administrators shall have any of the rights of a stockholder of the Company with respect to the shares subject to the Option until such Option is validly exercised.
8. The Option shall not be transferable by the Optionee other than to the Optionee’s executors or administrators by will or the laws of descent and distribution, and during the Optionee’s lifetime shall be exercisable only by the Optionee, except as may be otherwise permitted by the Committee in its sole discretion pursuant to the Plan.
9. In the event of the Optionee’s death, the Option shall thereafter be exercisable (to the extent otherwise exercisable hereunder) only by the Optionee’s executors, administrators or the beneficiary(ies) designated in writing by the Optionee in a manner permitted by the Committee. The Optionee has the right to change any such beneficiary designation at will.
10. The terms and conditions of the Option, including the number of shares and the class or series of capital stock that may be delivered upon exercise of the Option and the purchase price per share, are subject to adjustment as provided in the Plan, including, without limitation, under Section 12 of the Plan.
11. The Optionee agrees that the obligation of the Company to issue shares of Common Stock upon the exercise of the Option shall also be subject, as conditions precedent, to compliance with applicable provisions of the Securities Act of 1933, as amended, the Securities Exchange Act of 1934, as amended, state securities or corporation laws, rules and regulations under any of the foregoing and applicable requirements of any securities exchange upon which the Company’s securities shall be listed.
12. The Optionee acknowledges and agrees that the Option is subject to (a) the clawback and forfeiture provisions of Section 14(u) of the Plan, (b) the Company’s Policy for Recoupment of Incentive Compensation and (c) any subsequent clawback or forfeiture policy adopted by the Board or the Committee that is communicated to the Optionee or that is consistent with applicable law, whether the Option was granted before or after the effective date of any such clawback or forfeiture policy. Consistent with Section 14(u) of the Plan, the Committee may, in its sole discretion, cancel the Option if the Optionee, without the consent of the Company, while employed by or providing services to the Company or any Affiliate or after termination of such employment or service, violates a non-competition, non-solicitation or non-disclosure covenant or agreement or otherwise has engaged in or engages in any Detrimental Activity that is in conflict with or adverse to the interest of the Company or any Affiliate, including fraud or conduct contributing to any financial restatements or irregularities, as determined by the Committee in its sole discretion. If the Committee determines, in its sole discretion, that the Optionee has engaged in or engages in any activity referred to in the preceding sentence, the Committee may require the Optionee to forfeit any gain realized on the exercise of the Option and to repay the gain to the Company. In addition, if the Optionee receives any amount in excess of what the Optionee should have received under the terms of the Option for any reason (including, without limitation, by reason of a financial restatement, mistake in calculations or other administrative error), then the Optionee agrees to repay any such excess amount to the Company.
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13. The Option has been granted subject to the terms and conditions of the Plan, a copy of which has been provided to the Optionee and which the Optionee acknowledges having received and reviewed. Any conflict between this Agreement and the Plan shall be decided in favor of the provisions of the Plan. Any conflict between this Agreement and the terms of a written employment agreement for the Optionee that has been approved, ratified or confirmed by the Board of Directors of the Company (the “Board”) or the Committee shall be decided in favor of the provisions of such employment agreement. Capitalized terms used but not defined in this Agreement shall have the meanings given to them in the Plan. This Agreement represents the entire agreement between the parties and supersedes all prior and contemporaneous agreements and understandings relative to the same subject matter. The covenants contained in this Agreement (including any attachments) are intended to co-exist with and are not affected by any covenants contained in other agreements to which any of the parties hereto are or may become parties, are independently enforceable and do not supersede such other covenants. This Agreement is not intended to and does not amend, alter, suspend, discontinue, cancel or terminate any other award agreement executed by Optionee and the Company. This Agreement may not be amended, altered, suspended, discontinued, cancelled or terminated in any manner that would materially and adversely affect the rights of the Optionee except by a written agreement executed by the Optionee and the Company.
14. By accepting the Options evidenced by this Agreement, the Optionee hereby consents to the electronic delivery of all documents, including prospectuses, annual reports and other information required to be delivered by Securities and Exchange Commission rules. This consent may be revoked in writing by the Optionee at any time upon three (3) business days’ notice to the Company, in which case all documents, including subsequent prospectuses, annual reports and other information, will be delivered in hard copy to the Optionee.
15. The Optionee shall be required to pay to the Company, and the Company shall have the right and is hereby authorized to withhold, from any cash, shares of Common Stock, other securities or other property deliverable under the Option or from any compensation or other amounts owing to the Optionee, the amount (in cash, Common Stock, other securities or other property) of any required withholding taxes in respect of the Option, and to take such other action as may be necessary in the opinion of the Committee or the Company to satisfy all obligations for the payment of such withholding and taxes. Regardless of the amount withheld or reported, the Optionee is solely responsible for all taxes in respect of the Option (including taxes on imputed compensation), except for the Company’s share of applicable employment taxes. In addition, the Committee may, in its sole discretion, permit the Optionee to satisfy, in whole or in part, the foregoing withholding liability (but no more than the withholding liability calculated using the highest marginal tax rate) by (a) the delivery of shares of Common Stock (which are not subject to any pledge or other security interest) owned by the Optionee having a Fair Market Value equal to such withholding liability or (b) having the Company withhold from the number of shares of Common Stock otherwise issuable or deliverable pursuant to the exercise or settlement of the Option a number of shares with a Fair Market Value equal to such withholding liability. The obligations of the Company under this Agreement will be conditional on such payment or arrangements, and the Company will, to the extent permitted by law, have the right to deduct any such taxes from any payment of any kind otherwise due to the Optionee. If no election is made by the Optionee, the Company will withhold shares of Common Stock to satisfy the minimum statutory required tax withholding.
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16. Notices and communications under this Agreement must be in writing and either personally delivered or sent by registered or certified United States mail, return receipt requested, postage prepaid. Notices to the Company must be addressed to The Wendy’s Company, One Dave Thomas Boulevard, Dublin, Ohio 43017, Attention: Corporate Secretary, or any other address designated by the Company in a written notice to the Optionee. Notices to the Optionee will be directed to the address of the Optionee then currently on file with the Company, or at any other address given by the Optionee in a written notice to the Company.
17. If any provision of this Agreement could cause the application of an accelerated or additional tax under Section 409A of the Code upon the vesting or exercise of the Option (or any portion thereof), such provision shall be restructured, to the minimum extent possible, in a manner determined by the Company (and reasonably acceptable to the Optionee) that does not cause such an accelerated or additional tax.
18. This Agreement shall be governed by and construed in accordance with the internal laws of the State of Delaware applicable to contracts made and performed wholly within the State of Delaware, without giving effect to the conflict of laws provisions thereof. For purposes of litigating any dispute that arises under this Agreement, unless otherwise provided in a written employment agreement or letter, arbitration agreement or severance agreement and release executed by the parties, the parties hereby submit to and consent to the jurisdiction of the State of Ohio and agree that such litigation shall be conducted in the courts of Franklin County in the State of Ohio, or the federal courts for the Southern District of Ohio, where the grant of the Option is made and/or to be performed.
19. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original, and all of which together shall constitute one and the same instrument. Furthermore, delivery of a copy of a counterpart signature by facsimile or electronic transmission shall constitute a valid and binding execution and delivery of this Agreement, and such copy shall constitute an enforceable original document.
20. This Agreement may be executed and exchanged by facsimile or electronic mail transmission and the facsimile or electronic mail copies of each party’s respective signature will be binding as if the same were an original signature. This Agreement may also be executed through the use of electronic signature, which each party acknowledges is a lawful means of obtaining signatures in the United States. Each party agrees that its electronic signature is the legal equivalent of its manual signature on this Agreement. Each party further agrees that its use of a key pad, mouse or other device to select an item, button, icon or similar act/action, regarding any agreement, acknowledgement, consent terms, disclosures or conditions constitutes its signature, acceptance and agreement as if actually signed by such party in writing. Furthermore, to the extent applicable, all references to signatures in this Agreement may be satisfied by procedures that the Company or a third party designated by the Company has established or may establish for an electronic signature system, and the Optionee’s electronic signature shall be the same as, and shall have the same force and effect as, such Optionee’s written signature.
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21. The Optionee agrees and acknowledges that by accepting the Option, the Optionee (a) consents to the collection, use and transfer, in electronic or other form, of any of the Optionee’s personal data that is necessary or appropriate to facilitate the implementation, administration and management of the Option, this Agreement and the Plan, (b) understands that the Company may, for purposes of implementing, administering and managing the Plan, hold certain personal information about the Optionee, including, without limitation, the Optionee’s name, home address, telephone number, date of birth, social security number or other identification number, salary, nationality, job title, and details of all awards or entitlements to awards granted to the Optionee under the Plan or otherwise (“Personal Data”), (c) understands that Personal Data may be transferred to any third parties assisting in the implementation, administration and management of the Plan, including any broker with whom the shares of Common Stock issued upon exercise of the Option may be deposited, and that these recipients may be located in the United States or elsewhere, and that the recipient’s country may have different data privacy laws and protections than the United States, (d) waives, solely for purposes of implementing, administering and managing the Option and the Plan, any data privacy rights that the Optionee may have with respect to the Personal Data, and (e) authorizes the Company, its Affiliates and its agents, to store and transmit such Personal Data and related information in electronic form. The Optionee understands that the Optionee is providing consent under this Section 21 on a purely voluntary basis. If the Optionee does not consent, or if the Optionee later seeks to revoke consent, the Optionee’s employment status or service with the Company will not be affected; the only consequence of the Optionee’s refusing or withdrawing consent is that the Company would not be able to grant the Option or other awards to the Optionee or implement, administer or maintain such awards.
22. This Agreement shall be valid, binding and effective upon the Company and Optionee as of the date Optionee accepts and agrees to the Agreement, so long as such acceptance is received by the Company by the deadline and in the manner prescribed by the Company and communicated to the Optionee. If Optionee fails to accept and agree to this Agreement on or prior to such date and in the manner prescribed by the Company and communicated to the Optionee, this Agreement will not be binding and enforceable, Optionee shall have no rights and interests pursuant to this Agreement, including specifically the Options evidenced by this Agreement shall be forfeited, and neither the Optionee nor the Optionee’s heirs, executors, administrators and successors shall have any rights with respect thereto. This Agreement, if accepted by the Optionee, shall inure to the benefit of and be binding upon and enforceable by the Company’s successors and assigns.
23. This grant does not constitute an employment contract. Nothing in the Plan or this Agreement shall (a) confer upon the Optionee the right to continue to serve as a director or officer to, or to continue as an employee or service provider of, the Company or any of its Affiliates for the length of the vesting schedule set forth in Section 4 above or for any portion thereof or (b) be deemed to be a modification or waiver of the terms and conditions set forth in any written employment agreement for the Optionee that has been approved, ratified or confirmed by the Board or the Committee. The failure of either party to enforce any term of this Agreement shall not constitute a waiver of any rights or deprive the party of the right to insist thereafter upon strict adherence to that or any other term of this Agreement, nor shall a waiver of any breach of this Agreement constitute a waiver of any preceding or succeeding breach.
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24. The Company is not providing any tax, legal or financial advice, nor is the Company making any recommendations regarding the Optionee’s participation in the Plan or the Optionee’s acquisition or sale of the shares of Common Stock. The Optionee should consult with his or her personal tax, legal and financial advisors regarding his or her participation in the Plan before taking any action related to the Plan.
25. The Options and any underlying shares of Common Stock, and the income from and value of the same (either on the Award Date or at the time of exercise) shall not be taken into account in determining any benefits under any pension, retirement, profit sharing, group insurance or other benefit plan of the Company except as otherwise specifically provided in such other plan.
26. The Committee shall have full authority and discretion (subject only to the express provisions of the Plan) to decide all matters relating to the administration and interpretation of this Agreement. All such Committee determinations shall be final, conclusive and binding upon the Company, the Optionee and any and all interested parties.
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IN WITNESS WHEREOF, the Company, by a duly authorized officer thereof, has caused this Nonqualified Stock Option Award Agreement to be executed as of the date hereof.
| THE WENDY’S COMPANY | ||
| By: |
| |
| Name: | ||
| Title: | ||
EXHIBIT 10.6
RESTRICTED STOCK UNIT AWARD AGREEMENT
UNDER THE WENDY’S COMPANY
2020 OMNIBUS AWARD PLAN
RESTRICTED STOCK UNIT AWARD AGREEMENT (this “Agreement”), made as of _____________, 20___, by and between The Wendy’s Company (the “Company”) and __________ (the “Participant”):
WHEREAS, the Company maintains The Wendy’s Company 2020 Omnibus Award Plan (the “Plan”) under which the Compensation and Human Capital Committee of the Company’s Board of Directors or a subcommittee thereof (the “Committee”) may, among other things, award shares of the Company’s Common Stock, to such eligible persons under the Plan as the Committee may determine, subject to terms, conditions or restrictions as the Committee may deem appropriate; and
WHEREAS, pursuant to the Plan, the Committee has awarded to the Participant a restricted stock unit award conditioned upon the execution by the Company and the acceptance by the Participant of a Restricted Stock Unit Award Agreement setting forth all the terms and conditions applicable to such award in accordance with Delaware law.
NOW, THEREFORE, in consideration of the mutual promises and covenants contained herein, the parties hereby agree as follows:
1. Defined Terms. Except as otherwise specifically provided herein, capitalized terms used herein shall have the meanings attributed thereto in the Plan.
2. Award of Restricted Stock Units. Subject to the terms of the Plan and this Agreement, the Committee hereby awards to the Participant a restricted stock unit award (the “Restricted Stock Unit Award”) on __________, 20___ (the “Award Date”) covering shares of Common Stock (the “RSUs”). Each RSU represents the right to receive payment of one (1) share of Common Stock as of the date the RSU is settled, to the extent the RSU is vested, subject to the terms of the Plan and this Agreement.
3. Vesting and Settlement. Subject to the Participant’s continued employment with the Company and its Subsidiaries (other than as set forth in Section 6 below):
3.1. One-third of the RSUs shall vest and become nonforfeitable on the first anniversary of the Award Date;
3.2. One-third of the RSUs shall vest and become nonforfeitable on the second anniversary of the Award Date; and
3.3. One-third of the RSUs shall vest and become nonforfeitable on the third anniversary of the Award Date (each such anniversary is referred to as a “Vesting Date,” with the Vesting Date on the third anniversary of the Award Date also being referred to as the “Final Vesting Date”).
3.4. Promptly after each applicable Vesting Date (but in no event later than the last day of the calendar year in which the Vesting Date occurs), the Company shall distribute to the Participant one (1) share of Common Stock for each vested RSU.
4. Dividend Equivalent Rights. Each RSU shall also have a dividend equivalent right (a “Dividend Equivalent Right”). Each Dividend Equivalent Right represents the right to receive all of the ordinary cash dividends that are or would be payable with respect to the RSUs. With respect to each Dividend Equivalent Right, any such cash dividends shall be converted into additional RSUs based on the Fair Market Value of a share of Common Stock on the date such dividend is paid. Such additional RSUs shall be subject to the same terms and conditions applicable to the RSU to which the Dividend Equivalent Right relates, including, without limitation, the restrictions on transfer, forfeiture, vesting and settlement provisions contained in this Agreement. In the event that an RSU is forfeited as provided in Section 6 below, then the related Dividend Equivalent Right shall also be forfeited.
5. Transferability. The RSUs shall not be assigned, alienated, pledged, attached, sold or otherwise transferred or encumbered by the Participant other than by will or by the laws of descent and distribution and any such purported assignment, alienation, pledge, attachment, sale, transfer or encumbrance shall be void and unenforceable against the Company or an Affiliate; provided that the designation of a beneficiary shall not constitute an assignment, alienation, pledge, attachment, sale, transfer or encumbrance. The shares of Common Stock acquired by the Participant upon settlement of the RSUs may not be assigned, alienated, pledged, attached, sold or otherwise transferred or encumbered by the Participant, unless in compliance with all applicable securities laws as set forth in Section 15 below. The Participant shall not be deemed for any purpose to be the owner of any shares of Common Stock subject to the RSUs prior to settlement of any vested RSUs.
6. Effect of Termination of Employment or Service.
(a) Change in Control or Death. In the event of (i) the termination of the Participant’s employment or service to the Company and its Subsidiaries by the Company other than for Cause (and other than due to death), or by the Participant for Good Reason, in each case within eighteen (18) months following a Change in Control, or (ii) the termination of the Participant’s employment or service due to death, outstanding RSUs hereby granted to the Participant shall become fully vested as of the date of such termination of employment or service, and shall promptly thereafter (and, in any event, no later than the last day of the calendar year in which such vesting occurs) be settled by distribution to the Participant of one (1) share of Common Stock for each vested RSU (subject to the six-month delay required by Section 14(t)(ii) of the Plan for amounts that are subject to Section 409A of the Code, if the Participant is a “specified employee” at the time of separation).
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(b) Disability. In the event of the termination of the Participant’s employment or service due to Disability, outstanding RSUs hereby granted to the Participant shall continue to vest according to the vesting schedule set forth in Section 3 as if the Participant remained employed on each applicable Vesting Date; provided that if such termination occurs within eighteen (18) months following a Change in Control, payment shall be made at the time prescribed by Section 6(a).
(c) Severance. In the event the Participant’s employment or service to the Company and its Subsidiaries are terminated by the Company prior to the date the RSUs would otherwise vest in accordance with Section 3 above other than for Cause (and other than following a Change in Control or in connection with the Participant’s death or Disability, each as described in further detail in Section 6(a) or (b)), if the Participant is subject to an employment letter with the Company or its Subsidiaries, is in a class of employees subject to the Company’s Executive Severance Pay Policy, or is in a class of employees subject to another severance policy adopted by the Company or its Subsidiaries, and such employment letter or policy addresses the treatment of the RSUs, the RSUs shall vest as set forth under such employment letter or policy, as applicable.
(d) Retirement. In the event of the Participant’s Retirement (as defined below), any unvested RSUs on the date of such Retirement shall continue to vest according to the vesting schedule set forth in Section 3 as if the Participant remained employed on each applicable Vesting Date; provided that if the Participant’s separation from service occurs within eighteen (18) months following a Change in Control, payment shall be made at the time prescribed by Section 6(a). For purposes of this Award, “Retirement” shall mean the Participant’s voluntary termination of the Participant’s employment or service with the Company and its Subsidiaries at a time that Cause does not exist (A) after attaining age sixty (60), (B) after having at least ten (10) years of employment or service with the Company or its Subsidiaries, (C) as of a date specified (or such other date as agreed to by the Company) in a written notice of proposed Retirement provided by the Participant to the Company at least six (6) months before the proposed Retirement date and (D) the Participant otherwise complying with the Company’s then-current retirement policy.
(e) Other Voluntary Termination. Upon voluntary termination of the Participant’s employment or service with the Company and any of its Subsidiaries by the Participant, other than for Good Reason following a Change in Control as set forth in Section 6(a) or for Retirement as set forth in Section 6(c), the Restricted Stock Unit Award, to the extent not already vested, shall be forfeited, unless otherwise determined by the Committee in its sole discretion.
7. Beneficiary. The Participant may designate in writing one or more beneficiaries to receive the stock certificates (or, if applicable, a notice evidencing book entry notation) representing those RSUs that become vested and nonforfeitable and settled upon the Participant’s death. The Participant has the right to change any such beneficiary designation at will.
8. Withholding Taxes. The Participant shall be required to pay to the Company, and the Company shall have the right and is hereby authorized to withhold, from any cash, shares of Common Stock, other securities or other property deliverable in respect of the RSUs or from any compensation or other amounts owing to the Participant, the amount (in cash, Common Stock, other securities or other property) of any required withholding taxes in respect of the RSUs, and
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to take such other action as may be necessary in the opinion of the Committee or the Company to satisfy all obligations for the payment of such withholding and taxes. Regardless of the amount withheld or reported, the Participant is solely responsible for all taxes in respect of the Restricted Stock Unit Award (including taxes on imputed compensation), except for the Company’s share of applicable employment taxes. In addition, the Committee may, in its sole discretion, permit the Participant to satisfy, in whole or in part, the foregoing withholding liability (but no more than the withholding liability calculated using the highest marginal tax rate) by (a) the delivery of shares of Common Stock (which are not subject to any pledge or other security interest) owned by the Participant having a Fair Market Value equal to such withholding liability or (b) having the Company withhold from the number of shares of Common Stock otherwise issuable or deliverable upon settlement of the RSUs a number of shares with a Fair Market Value equal to such withholding liability. The obligations of the Company under this Agreement will be conditional on such payment or arrangements, and the Company will, to the extent permitted by law, have the right to deduct any such taxes from any payment of any kind otherwise due to the Participant. If no election is made by the Participant, the Company will withhold shares of Common Stock to satisfy the minimum statutory required tax withholding.
9. Impact on Other Benefits. The RSUs and any underlying shares of Common Stock, and the income from and value of the same (either on the Award Date or at the time any RSUs become vested and/or settled), shall not be taken into account in determining any benefits under any pension, retirement, profit sharing, group insurance or other benefit plan of the Company except as otherwise specifically provided in such other plan.
10. Administration. The Committee shall have full authority and discretion (subject only to the express provisions of the Plan) to decide all matters relating to the administration and interpretation of this Agreement. All such Committee determinations shall be final, conclusive and binding upon the Company, the Participant and any and all interested parties.
11. Funding. Dividends and distributions with respect to the RSUs shall be paid directly by the Company. The Company shall not be required to fund or otherwise segregate assets to be used for payment of these amounts under the Plan, and all obligations of the Company with respect to such amounts under the Plan shall remain subject to the claims of the Company’s general creditors.
12. No Right to Continued Employment; No Waiver. This grant does not constitute an employment contract. Nothing in the Plan or this Agreement shall (a) confer upon the Participant the right to continue to serve as a director or officer to, or to continue as an employee or service provider of, the Company or any of its Affiliates for the length of the vesting period set forth in Section 3 above or for any portion thereof or (b) be deemed to be a modification or waiver of the terms and conditions set forth in any written employment agreement for the Participant that has been approved, ratified or confirmed by the Board of Directors of the Company (the “Board”) or the Committee. The failure of either party to enforce any term of this Agreement shall not constitute a waiver of any rights or deprive the party of the right to insist thereafter upon strict adherence to that or any other term of this Agreement, nor shall a waiver of any breach of this Agreement constitute a waiver of any preceding or succeeding breach.
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13. Clawback. The Participant acknowledges and agrees that the Restricted Stock Unit Award is subject to (a) the clawback and forfeiture provisions of Section 14(u) of the Plan, (b) the Company’s Policy for Recoupment of Incentive Compensation and (c) any subsequent clawback or forfeiture policy adopted by the Board or the Committee that is communicated to the Participant or that is consistent with applicable law, whether the Restricted Stock Unit Award was granted before or after the effective date of any such clawback or forfeiture policy. Consistent with Section 14(u) of the Plan, the Committee may, in its sole discretion, cancel the Restricted Stock Unit Award if the Participant, without the consent of the Company, while employed by or providing services to the Company or any Affiliate or after termination of such employment or service, violates a non-competition, non-solicitation or non-disclosure covenant or agreement or otherwise has engaged in or engages in any Detrimental Activity that is in conflict with or adverse to the interest of the Company or any Affiliate, including fraud or conduct contributing to any financial restatements or irregularities, as determined by the Committee in its sole discretion. If the Committee determines, in its sole discretion, that the Participant has engaged in or engages in any activity referred to in the preceding sentence, the Committee may require the Participant to forfeit any gain realized on the vesting of the Restricted Stock Unit Award and to repay the gain to the Company. In addition, if the Participant receives any amount in excess of what the Participant should have received under the terms of the Restricted Stock Unit Award for any reason (including, without limitation, by reason of a financial restatement, mistake in calculations or other administrative error), then the Participant agrees to repay any such excess amount to the Company.
14. Bound by Plan. The Restricted Stock Unit Award has been granted subject to the terms and conditions of the Plan, a copy of which has been provided to the Participant and which the Participant acknowledges having received and reviewed. Any conflict between this Agreement and the Plan shall be decided in favor of the provisions of the Plan. Any conflict between this Agreement and the terms of a written employment agreement for the Participant that has been approved, ratified or confirmed by the Board or the Committee shall be decided in favor of the provisions of such employment agreement. This Agreement represents the entire agreement between the parties and supersedes all prior and contemporaneous agreements and understandings relative to the same subject matter. The covenants contained in this Agreement (including any attachments) are intended to co-exist with and are not affected by any covenants contained in other agreements to which any of the parties hereto are or may become parties, are independently enforceable and do not supersede such other covenants. This Agreement is not intended to and does not amend, alter, suspend, discontinue, cancel or terminate any other award agreement executed by Participant and the Company. This Agreement may not be amended, altered, suspended, discontinued, cancelled or terminated in any manner that would materially and adversely affect the rights of the Participant except by a written agreement executed by the Participant and the Company.
15. Securities Laws. The Participant agrees that the obligation of the Company to issue shares of Common Stock upon vesting of the Restricted Stock Unit Award shall also be subject, as conditions precedent, to compliance with applicable provisions of the Securities Act of 1933, as amended, the Securities Exchange Act of 1934, as amended, state securities or corporation laws, rules and regulations under any of the foregoing and applicable requirements of any securities exchange upon which the Company’s securities shall be listed.
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16. Electronic Delivery. By accepting the Restricted Stock Unit Award, the Participant hereby consents to the electronic delivery of all documents, including prospectuses, annual reports and other information required to be delivered by Securities and Exchange Commission rules. This consent may be revoked in writing by the Participant at any time upon three (3) business days’ notice to the Company, in which case all documents, including subsequent prospectuses, annual reports and other information, will be delivered in hard copy to the Participant.
17. Force and Effect. The various provisions of this Agreement are severable in their entirety. Any determination of invalidity or unenforceability of any one provision shall have no effect on the continuing force and effect of the remaining provisions.
18. Governing Law; Venue. This Agreement shall be governed by and construed in accordance with the internal laws of the State of Delaware applicable to contracts made and performed wholly within the State of Delaware, without giving effect to the conflict of laws provisions thereof. For purposes of litigating any dispute that arises under this Agreement, unless otherwise provided in a written employment agreement or letter, arbitration agreement or severance agreement and release executed by the parties, the parties hereby submit to and consent to the jurisdiction of the State of Ohio and agree that such litigation shall be conducted in the courts of Franklin County in the State of Ohio, or the federal courts for the Southern District of Ohio, where the grant of the Restricted Stock Unit Award is made and/or to be performed.
19. Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original, and all of which together shall constitute one and the same instrument. Furthermore, delivery of a copy of a counterpart signature by facsimile or electronic transmission shall constitute a valid and binding execution and delivery of this Agreement, and such copy shall constitute an enforceable original document.
20. Electronic Signature. This Agreement may be executed and exchanged by facsimile or electronic mail transmission and the facsimile or electronic mail copies of each party’s respective signature will be binding as if the same were an original signature. This Agreement may also be executed through the use of electronic signature, which each party acknowledges is a lawful means of obtaining signatures in the United States. Each party agrees that its electronic signature is the legal equivalent of its manual signature on this Agreement. Each party further agrees that its use of a key pad, mouse or other device to select an item, button, icon or similar act/action, regarding any agreement, acknowledgement, consent terms, disclosures or conditions constitutes its signature, acceptance and agreement as if actually signed by such party in writing. Furthermore, to the extent applicable, all references to signatures in this Agreement may be satisfied by procedures that the Company or a third party designated by the Company has established or may establish for an electronic signature system, and the Participant’s electronic signature shall be the same as, and shall have the same force and effect as, such Participant’s written signature.
21. Data Privacy. The Participant agrees and acknowledges that by accepting the Restricted Stock Unit Award, the Participant (a) consents to the collection, use and transfer, in electronic or other form, of any of the Participant’s personal data that is necessary or appropriate to facilitate the implementation, administration and management of the Restricted Stock Unit Award, this Agreement and the Plan, (b) understands that the Company may, for purposes of implementing, administering and managing the Plan, hold certain personal information about the
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Participant, including, without limitation, the Participant’s name, home address, telephone number, date of birth, social security number or other identification number, salary, nationality, job title, and details of all awards or entitlements to awards granted to the Participant under the Plan or otherwise (“Personal Data”), (c) understands that Personal Data may be transferred to any third parties assisting in the implementation, administration and management of the Plan, including any broker with whom the shares of Common Stock issued upon vesting or settlement of the Restricted Stock Unit Award may be deposited, and that these recipients may be located in the United States or elsewhere, and that the recipient’s country may have different data privacy laws and protections than the United States, (d) waives, solely for purposes of implementing, administering and managing the RSUs and the Plan, any data privacy rights that the Participant may have with respect to the Personal Data, and (e) authorizes the Company, its Affiliates and its agents, to store and transmit such Personal Data and related information in electronic form. The Participant understands that the Participant is providing consent under this Section 21 on a purely voluntary basis. If the Participant does not consent, or if the Participant later seeks to revoke consent, the Participant’s employment status or service with the Company will not be affected; the only consequence of the Participant’s refusing or withdrawing consent is that the Company would not be able to grant the Restricted Stock Unit Award or other awards to the Participant or implement, administer or maintain such awards.
22. Successors. This Agreement shall be binding and inure to the benefit of the successors, assigns and heirs of the respective parties.
23. Notices. Notices and communications under this Agreement must be in writing and either personally delivered or sent by registered or certified United States mail, return receipt requested, postage prepaid. Notices to the Company must be addressed to The Wendy’s Company, One Dave Thomas Boulevard, Dublin, Ohio 43017, Attention: Corporate Secretary, or any other address designated by the Company in a written notice to the Participant. Notices to the Participant will be directed to the address of the Participant then currently on file with the Company, or at any other address given by the Participant in a written notice to the Company.
24. Validity of Agreement. This Agreement shall be valid, binding and effective upon the Company and the Participant as of the date the Participant accepts and agrees to the Agreement, so long as such acceptance is received by the Company by the deadline and in the manner prescribed by the Company and communicated to the Participant. If the Participant fails to accept and agree to this Agreement on or prior to such date and in the manner prescribed by the Company and communicated to the Participant, this Agreement will not be binding and enforceable, the Participant shall have no rights and interests pursuant to this Agreement, including specifically the RSUs evidenced by this Agreement shall be forfeited, and neither the Participant nor the Participant’s heirs, executors, administrators and successors shall have any rights with respect thereto.
25. Section 409A. If any provision of this Agreement could cause the application of an accelerated or additional tax under Section 409A of the Code upon the vesting or settlement of the Restricted Stock Unit Award (or any portion thereof), such provision shall be restructured, to the minimum extent possible, in a manner determined by the Company (and reasonably acceptable to the Participant) that does not cause such an accelerated or additional tax. It is intended that this Agreement shall be exempt from Section 409A of the Code or comply with the requirements to avoid tax under Section 409A of the Code, as described in Section 14(t) of the Plan.
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26. No Company Advice. The Company is not providing any tax, legal or financial advice, nor is the Company making any recommendations regarding the Participant’s participation in the Plan or the Participant’s acquisition or sale of the shares of Common Stock. The Participant should consult with his or her personal tax, legal and financial advisors regarding his or her participation in the Plan before taking any action related to the Plan.
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IN WITNESS WHEREOF, the Company, by a duly authorized officer thereof, has caused this Restricted Stock Unit Award Agreement to be executed as of the date hereof.
| THE WENDY’S COMPANY | ||
| By: |
| |
| Name: | ||
| Title: | ||
EXHIBIT 10.7
RESTRICTED STOCK UNIT AWARD AGREEMENT
UNDER THE WENDY’S COMPANY
2020 OMNIBUS AWARD PLAN
RESTRICTED STOCK UNIT AWARD AGREEMENT (this “Agreement”), made as of , 20___, by and between The Wendy’s Company (the “Company”) and (the “Participant”):
WHEREAS, the Company maintains The Wendy’s Company 2020 Omnibus Award Plan (the “Plan”) under which the Compensation and Human Capital Committee of the Company’s Board of Directors or a subcommittee thereof (the “Committee”) may, among other things, award shares of the Company’s Common Stock, to such eligible persons under the Plan as the Committee may determine, subject to terms, conditions or restrictions as the Committee may deem appropriate; and
WHEREAS, pursuant to the Plan, the Committee has awarded to the Participant a restricted stock unit award conditioned upon the execution by the Company and the acceptance by the Participant of a Restricted Stock Unit Award Agreement setting forth all the terms and conditions applicable to such award in accordance with Delaware law.
NOW, THEREFORE, in consideration of the mutual promises and covenants contained herein, the parties hereby agree as follows:
1. Defined Terms. Except as otherwise specifically provided herein, capitalized terms used herein shall have the meanings attributed thereto in the Plan.
2. Award of Restricted Stock Units. Subject to the terms of the Plan and this Agreement, the Committee hereby awards to the Participant a restricted stock unit award (the “Restricted Stock Unit Award”) on , 20___ (the “Award Date”) covering shares of Common Stock (the “RSUs”). Each RSU represents the right to receive payment of one (1) share of Common Stock as of the date the RSU is settled, to the extent the RSU is vested, subject to the terms of the Plan and this Agreement.
3. Vesting and Settlement. Subject to the Participant’s continued employment with the Company and its Subsidiaries (other than as set forth in Section 6 below), all of the RSU’s shall vest and become nonforfeitable on (the “Vesting Date”).
3.4. Promptly after the Vesting Date (but in no event later than the last day of the calendar year in which the Vesting Date occurs), the Company shall distribute to the Participant one (1) share of Common Stock for each vested RSU.
4. Dividend Equivalent Rights. Each RSU shall also have a dividend equivalent right (a “Dividend Equivalent Right”). Each Dividend Equivalent Right represents the right to receive all of the ordinary cash dividends that are or would be payable with respect to the RSUs. With respect to each Dividend Equivalent Right, any such cash dividends shall be converted into additional RSUs based on the Fair Market Value of a share of Common Stock on the date such dividend is paid. Such additional RSUs shall be subject to the same terms and conditions applicable to the RSU to which the Dividend Equivalent Right relates, including, without limitation, the restrictions on transfer, forfeiture, vesting and settlement provisions contained in this Agreement. In the event that an RSU is forfeited as provided in Section 6 below, then the related Dividend Equivalent Right shall also be forfeited.
5. Transferability. The RSUs shall not be assigned, alienated, pledged, attached, sold or otherwise transferred or encumbered by the Participant other than by will or by the laws of descent and distribution and any such purported assignment, alienation, pledge, attachment, sale, transfer or encumbrance shall be void and unenforceable against the Company or an Affiliate; provided that the designation of a beneficiary shall not constitute an assignment, alienation, pledge, attachment, sale, transfer or encumbrance. The shares of Common Stock acquired by the Participant upon settlement of the RSUs may not be assigned, alienated, pledged, attached, sold or otherwise transferred or encumbered by the Participant, unless in compliance with all applicable securities laws as set forth in Section 15 below. The Participant shall not be deemed for any purpose to be the owner of any shares of Common Stock subject to the RSUs prior to settlement of any vested RSUs.
6. Effect of Termination of Employment or Service.
| (a) | Change in Control or Death. In the event of (i) the termination of the Participant’s employment or service to the Company and its Subsidiaries by the Company other than for Cause (and other than due to death), or by the Participant for Good Reason, in each case within eighteen (18) months following a Change in Control, or (ii) the termination of the Participant’s employment or service due to death, outstanding RSUs hereby granted to the Participant shall become fully vested as of the date of such termination of employment or service, and shall promptly thereafter (and, in any event, no later than the last day of the calendar year in which such vesting occurs) be settled by distribution to the Participant of one (1) share of Common Stock for each vested RSU (subject to the six-month delay required by Section 14(t)(ii) of the Plan for amounts that are subject to Section 409A of the Code, if the Participant is a “specified employee” at the time of separation). |
| (b) | Disability. In the event of the termination of the Participant’s employment or service due to Disability, outstanding RSUs hereby granted to the Participant shall continue to vest according to the vesting schedule set forth in Section 3 as if the Participant remained employed on the Vesting Date; provided that if such termination occurs within eighteen (18) months following a Change in Control, payment shall be made at the time prescribed by Section 6(a). |
| (c) | Severance. In the event the Participant’s employment or service to the Company and its Subsidiaries are terminated by the Company prior to the date the RSUs would otherwise vest in accordance with Section 3 above other than for Cause (and other than following a Change in Control or in connection with the Participant’s death or Disability, each as described in further detail in Section 6(a) or (b)), if the |
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| Participant is subject to an employment letter with the Company or its Subsidiaries, is in a class of employees subject to the Company’s Executive Severance Pay Policy, or is in a class of employees subject to another severance policy adopted by the Company or its Subsidiaries, and such employment letter or policy addresses the treatment of the RSUs, the RSUs shall vest as set forth under such employment letter or policy, as applicable. |
| (d) | Retirement. In the event of the Participant’s Retirement (as defined below), any unvested RSUs on the date of such Retirement shall continue to vest according to the vesting schedule set forth in Section 3 as if the Participant remained employed on the Vesting Date; provided that if the Participant’s separation from service occurs within eighteen (18) months following a Change in Control, payment shall be made at the time prescribed by Section 6(a). For purposes of this Award, “Retirement” shall mean the Participant’s voluntary termination of the Participant’s employment or service with the Company and its Subsidiaries at a time that Cause does not exist (A) after attaining age sixty (60), (B) after having at least ten (10) years of employment or service with the Company or its Subsidiaries, (C) as of a date specified (or such other date as agreed to by the Company) in a written notice of proposed Retirement provided by the Participant to the Company at least six (6) months before the proposed Retirement date and (D) the Participant otherwise complying with the Company’s then-current retirement policy. |
| (e) | Other Voluntary Termination. Upon voluntary termination of the Participant’s employment or service with the Company and any of its Subsidiaries by the Participant, other than for Good Reason following a Change in Control as set forth in Section 6(a) or for Retirement as set forth in Section 6(c), the Restricted Stock Unit Award, to the extent not already vested, shall be forfeited, unless otherwise determined by the Committee in its sole discretion. |
7. Beneficiary. The Participant may designate in writing one or more beneficiaries to receive the stock certificates (or, if applicable, a notice evidencing book entry notation) representing those RSUs that become vested and nonforfeitable and settled upon the Participant’s death. The Participant has the right to change any such beneficiary designation at will.
8. Withholding Taxes. The Participant shall be required to pay to the Company, and the Company shall have the right and is hereby authorized to withhold, from any cash, shares of Common Stock, other securities or other property deliverable in respect of the RSUs or from any compensation or other amounts owing to the Participant, the amount (in cash, Common Stock, other securities or other property) of any required withholding taxes in respect of the RSUs, and to take such other action as may be necessary in the opinion of the Committee or the Company to satisfy all obligations for the payment of such withholding and taxes. Regardless of the amount withheld or reported, the Participant is solely responsible for all taxes in respect of the Restricted Stock Unit Award (including taxes on imputed compensation), except for the Company’s share of applicable employment taxes. In addition, the Committee may, in its sole discretion, permit the Participant to satisfy, in whole or in part, the foregoing withholding liability (but no more than the withholding liability calculated using the highest marginal tax rate) by (a) the delivery of shares of Common Stock (which are not subject to any pledge or other security interest) owned by the
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Participant having a Fair Market Value equal to such withholding liability or (b) having the Company withhold from the number of shares of Common Stock otherwise issuable or deliverable upon settlement of the RSUs a number of shares with a Fair Market Value equal to such withholding liability. The obligations of the Company under this Agreement will be conditional on such payment or arrangements, and the Company will, to the extent permitted by law, have the right to deduct any such taxes from any payment of any kind otherwise due to the Participant. If no election is made by the Participant, the Company will withhold shares of Common Stock to satisfy the minimum statutory required tax withholding.
9. Impact on Other Benefits. The RSUs and any underlying shares of Common Stock, and the income from and value of the same (either on the Award Date or at the time any RSUs become vested and/or settled), shall not be taken into account in determining any benefits under any pension, retirement, profit sharing, group insurance or other benefit plan of the Company except as otherwise specifically provided in such other plan.
10. Administration. The Committee shall have full authority and discretion (subject only to the express provisions of the Plan) to decide all matters relating to the administration and interpretation of this Agreement. All such Committee determinations shall be final, conclusive and binding upon the Company, the Participant and any and all interested parties.
11. Funding. Dividends and distributions with respect to the RSUs shall be paid directly by the Company. The Company shall not be required to fund or otherwise segregate assets to be used for payment of these amounts under the Plan, and all obligations of the Company with respect to such amounts under the Plan shall remain subject to the claims of the Company’s general creditors.
12. No Right to Continued Employment; No Waiver. This grant does not constitute an employment contract. Nothing in the Plan or this Agreement shall (a) confer upon the Participant the right to continue to serve as a director or officer to, or to continue as an employee or service provider of, the Company or any of its Affiliates for the length of the vesting period set forth in Section 3 above or for any portion thereof or (b) be deemed to be a modification or waiver of the terms and conditions set forth in any written employment agreement for the Participant that has been approved, ratified or confirmed by the Board of Directors of the Company (the “Board”) or the Committee. The failure of either party to enforce any term of this Agreement shall not constitute a waiver of any rights or deprive the party of the right to insist thereafter upon strict adherence to that or any other term of this Agreement, nor shall a waiver of any breach of this Agreement constitute a waiver of any preceding or succeeding breach.
13. Clawback. The Participant acknowledges and agrees that the Restricted Stock Unit Award is subject to (a) the clawback and forfeiture provisions of Section 14(u) of the Plan, (b) the Company’s Policy for Recoupment of Incentive Compensation and (c) any subsequent clawback or forfeiture policy adopted by the Board or the Committee that is communicated to the Participant or that is consistent with applicable law, whether the Restricted Stock Unit Award was granted before or after the effective date of any such clawback or forfeiture policy. Consistent with Section 14(u) of the Plan, the Committee may, in its sole discretion, cancel the Restricted Stock Unit Award if the Participant, without the consent of the Company, while employed by or providing services to the Company or any Affiliate or after termination of such employment or service, violates a non-competition, non-solicitation or non-disclosure covenant or agreement or otherwise
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has engaged in or engages in any Detrimental Activity that is in conflict with or adverse to the interest of the Company or any Affiliate, including fraud or conduct contributing to any financial restatements or irregularities, as determined by the Committee in its sole discretion. If the Committee determines, in its sole discretion, that the Participant has engaged in or engages in any activity referred to in the preceding sentence, the Committee may require the Participant to forfeit any gain realized on the vesting of the Restricted Stock Unit Award and to repay the gain to the Company. In addition, if the Participant receives any amount in excess of what the Participant should have received under the terms of the Restricted Stock Unit Award for any reason (including, without limitation, by reason of a financial restatement, mistake in calculations or other administrative error), then the Participant agrees to repay any such excess amount to the Company.
14. Bound by Plan. The Restricted Stock Unit Award has been granted subject to the terms and conditions of the Plan, a copy of which has been provided to the Participant and which the Participant acknowledges having received and reviewed. Any conflict between this Agreement and the Plan shall be decided in favor of the provisions of the Plan. Any conflict between this Agreement and the terms of a written employment agreement for the Participant that has been approved, ratified or confirmed by the Board or the Committee shall be decided in favor of the provisions of such employment agreement. This Agreement represents the entire agreement between the parties and supersedes all prior and contemporaneous agreements and understandings relative to the same subject matter. The covenants contained in this Agreement (including any attachments) are intended to co-exist with and are not affected by any covenants contained in other agreements to which any of the parties hereto are or may become parties, are independently enforceable and do not supersede such other covenants. This Agreement is not intended to and does not amend, alter, suspend, discontinue, cancel or terminate any other award agreement executed by Participant and the Company. This Agreement may not be amended, altered, suspended, discontinued, cancelled or terminated in any manner that would materially and adversely affect the rights of the Participant except by a written agreement executed by the Participant and the Company.
15. Securities Laws. The Participant agrees that the obligation of the Company to issue shares of Common Stock upon vesting of the Restricted Stock Unit Award shall also be subject, as conditions precedent, to compliance with applicable provisions of the Securities Act of 1933, as amended, the Securities Exchange Act of 1934, as amended, state securities or corporation laws, rules and regulations under any of the foregoing and applicable requirements of any securities exchange upon which the Company’s securities shall be listed.
16. Electronic Delivery. By accepting the Restricted Stock Unit Award, the Participant hereby consents to the electronic delivery of all documents, including prospectuses, annual reports and other information required to be delivered by Securities and Exchange Commission rules. This consent may be revoked in writing by the Participant at any time upon three (3) business days’ notice to the Company, in which case all documents, including subsequent prospectuses, annual reports and other information, will be delivered in hard copy to the Participant.
17. Force and Effect. The various provisions of this Agreement are severable in their entirety. Any determination of invalidity or unenforceability of any one provision shall have no effect on the continuing force and effect of the remaining provisions.
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18. Governing Law; Venue. This Agreement shall be governed by and construed in accordance with the internal laws of the State of Delaware applicable to contracts made and performed wholly within the State of Delaware, without giving effect to the conflict of laws provisions thereof. For purposes of litigating any dispute that arises under this Agreement, unless otherwise provided in a written employment agreement or letter, arbitration agreement or severance agreement and release executed by the parties, the parties hereby submit to and consent to the jurisdiction of the State of Ohio and agree that such litigation shall be conducted in the courts of Franklin County in the State of Ohio, or the federal courts for the Southern District of Ohio, where the grant of the Restricted Stock Unit Award is made and/or to be performed.
19. Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original, and all of which together shall constitute one and the same instrument. Furthermore, delivery of a copy of a counterpart signature by facsimile or electronic transmission shall constitute a valid and binding execution and delivery of this Agreement, and such copy shall constitute an enforceable original document.
20. Electronic Signature. This Agreement may be executed and exchanged by facsimile or electronic mail transmission and the facsimile or electronic mail copies of each party’s respective signature will be binding as if the same were an original signature. This Agreement may also be executed through the use of electronic signature, which each party acknowledges is a lawful means of obtaining signatures in the United States. Each party agrees that its electronic signature is the legal equivalent of its manual signature on this Agreement. Each party further agrees that its use of a key pad, mouse or other device to select an item, button, icon or similar act/action, regarding any agreement, acknowledgement, consent terms, disclosures or conditions constitutes its signature, acceptance and agreement as if actually signed by such party in writing. Furthermore, to the extent applicable, all references to signatures in this Agreement may be satisfied by procedures that the Company or a third party designated by the Company has established or may establish for an electronic signature system, and the Participant’s electronic signature shall be the same as, and shall have the same force and effect as, such Participant’s written signature.
21. Data Privacy. The Participant agrees and acknowledges that by accepting the Restricted Stock Unit Award, the Participant (a) consents to the collection, use and transfer, in electronic or other form, of any of the Participant’s personal data that is necessary or appropriate to facilitate the implementation, administration and management of the Restricted Stock Unit Award, this Agreement and the Plan, (b) understands that the Company may, for purposes of implementing, administering and managing the Plan, hold certain personal information about the Participant, including, without limitation, the Participant’s name, home address, telephone number, date of birth, social security number or other identification number, salary, nationality, job title, and details of all awards or entitlements to awards granted to the Participant under the Plan or otherwise (“Personal Data”), (c) understands that Personal Data may be transferred to any third parties assisting in the implementation, administration and management of the Plan, including any broker with whom the shares of Common Stock issued upon vesting or settlement of the Restricted Stock Unit Award may be deposited, and that these recipients may be located in the United States or elsewhere, and that the recipient’s country may have different data privacy laws and protections than the United States, (d) waives, solely for purposes of implementing, administering and managing the RSUs and the Plan, any data privacy rights that the Participant may have with respect to the Personal Data, and (e) authorizes the Company, its Affiliates and its agents, to store and
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transmit such Personal Data and related information in electronic form. The Participant understands that the Participant is providing consent under this Section 21 on a purely voluntary basis. If the Participant does not consent, or if the Participant later seeks to revoke consent, the Participant’s employment status or service with the Company will not be affected; the only consequence of the Participant’s refusing or withdrawing consent is that the Company would not be able to grant the Restricted Stock Unit Award or other awards to the Participant or implement, administer or maintain such awards.
22. Successors. This Agreement shall be binding and inure to the benefit of the successors, assigns and heirs of the respective parties.
23. Notices. Notices and communications under this Agreement must be in writing and either personally delivered or sent by registered or certified United States mail, return receipt requested, postage prepaid. Notices to the Company must be addressed to The Wendy’s Company, One Dave Thomas Boulevard, Dublin, Ohio 43017, Attention: Corporate Secretary, or any other address designated by the Company in a written notice to the Participant. Notices to the Participant will be directed to the address of the Participant then currently on file with the Company, or at any other address given by the Participant in a written notice to the Company.
24. Validity of Agreement. This Agreement shall be valid, binding and effective upon the Company and the Participant as of the date the Participant accepts and agrees to the Agreement, so long as such acceptance is received by the Company by the deadline and in the manner prescribed by the Company and communicated to the Participant. If the Participant fails to accept and agree to this Agreement on or prior to such date and in the manner prescribed by the Company and communicated to the Participant, this Agreement will not be binding and enforceable, the Participant shall have no rights and interests pursuant to this Agreement, including specifically the RSUs evidenced by this Agreement shall be forfeited, and neither the Participant nor the Participant’s heirs, executors, administrators and successors shall have any rights with respect thereto.
25. Section 409A. If any provision of this Agreement could cause the application of an accelerated or additional tax under Section 409A of the Code upon the vesting or settlement of the Restricted Stock Unit Award (or any portion thereof), such provision shall be restructured, to the minimum extent possible, in a manner determined by the Company (and reasonably acceptable to the Participant) that does not cause such an accelerated or additional tax. It is intended that this Agreement shall be exempt from Section 409A of the Code or comply with the requirements to avoid tax under Section 409A of the Code, as described in Section 14(t) of the Plan.
26. No Company Advice. The Company is not providing any tax, legal or financial advice, nor is the Company making any recommendations regarding the Participant’s participation in the Plan or the Participant’s acquisition or sale of the shares of Common Stock. The Participant should consult with his or her personal tax, legal and financial advisors regarding his or her participation in the Plan before taking any action related to the Plan.
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IN WITNESS WHEREOF, the Company, by a duly authorized officer thereof, has caused this Restricted Stock Unit Award Agreement to be executed as of the date hereof.
| THE WENDY’S COMPANY | ||
| By: |
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| Name: |
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| Title: |
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Exhibit 99.1
Wendy’s Independent Committee Rejects Proposal from Trian Partners-Led Group
Determines Proposal Substantially Undervalues Wendy’s and the Significant Upside Expected from Execution of Dave’s Way, the Company’s Strategic Plan
Announced Separately Today
Adopts Limited-Duration Shareholder Rights Plan
DUBLIN, Ohio – Nov. 5, 2026 – The Wendy’s Company (Nasdaq: WEN) (“Wendy’s” or the “Company”) today announced that the previously constituted committee of independent directors of the Company’s Board of Directors (the “Independent Committee”), which is unaffiliated with Trian Fund Management, L.P. (“Trian Partners”) and its investor group, has unanimously rejected the unsolicited, non-binding proposal from Trian Partners, Flynn Group LP, BlueFive Capital and Sixth Street Partners (together, the “Investor Group”) to acquire all of the outstanding shares of common stock of Wendy’s not currently owned by the Investor Group for $7.35 per share in cash (the “Proposal”). Consistent with its fiduciary duties, and in consultation with its independent financial and legal advisors, the Independent Committee carefully and thoroughly reviewed and evaluated the Proposal and concluded that the Proposal substantially undervalues the Company, does not reflect the value the Independent Committee expects to be created through the system’s execution of Dave’s Way, and is not in the best interests of Wendy’s and its shareholders.
“The Independent Committee thoroughly evaluated this Proposal and unanimously concluded that it substantially undervalues Wendy’s standalone prospects and long-term earnings potential,” said Art Winkleblack, Chairman of the Board and a member of the Independent Committee. “Our confidence rests firmly in Bob Wright’s proven track record of seasoned industry leadership, including restaurant business turnarounds. We believe in Bob and his executive team’s ability to execute on the plan they recently presented to our franchisees at the 2026 Wendy’s convention. The Independent Committee and management team are confident that, through the implementation of Dave’s Way, the Company will deliver on its value potential.”
Wendy’s announced Dave’s Way separately today as part of the Company’s third quarter earnings release. Under Bob Wright’s leadership as President and Chief Executive Officer, Dave’s Way is focused on growing customer traffic and market share while strengthening restaurant profitability through five strategic pillars: menu with quality food at real value, distinct branding and marketing to drive demand, operational excellence that delights customers, a winning digital experience to build frequency and restaurants as the engine for growth. With execution already underway, the Company has strengthened its leadership team and aligned its global franchise system behind Dave’s Way, established a Strategic Activation Office to accelerate progress across all five pillars, and is already seeing some early returns on those initial strategic investments. The Board of Directors remains committed to acting in the best interests of the Company and is focused on enhancing shareholder value consistent with its fiduciary duties.
More information on Dave’s Way will be made available during the Company’s third quarter earnings call, to be held this morning at 8:30 a.m. (Eastern Time).
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Limited-Duration Shareholder Rights Plan
The Company also announced today that the Board of Directors (the “Board”) determined in accordance with its fiduciary duties that adopting a shareholder rights plan (the “Rights Plan”) would be in the best interests of the Company and all of its shareholders, and that the Board adopted a limited-duration Rights Plan on November 4, 2026.
The Rights Plan is intended to reduce the likelihood that any person or group gains actual or negative control of the Company without paying all shareholders an appropriate premium for that control, and to ensure that all shareholders receive fair and equal treatment in the event of any proposed takeover of the Company. It is also intended to afford the Board and the Independent Committee sufficient time and opportunity to make informed judgments and take actions that are in the best interests of the Company and its shareholders. The Rights Plan applies equally to all current and future shareholders and is not intended to deter offers or preclude the Board of Directors from considering offers that are fair and otherwise in the best interest of the Company and its shareholders.
In adopting the Rights Plan, the Board also considered, among other things, that the Investor Group rejected an offer from the Company to enter into a customary standstill agreement.
The Rights Plan is similar to other plans adopted by publicly traded companies. Pursuant to the Rights Plan, the Company is issuing one right for each share of common stock as of the close of business on November 16, 2026. Under the Rights Plan, the rights will become exercisable if a person or group acquires beneficial ownership of 15% or more of Wendy’s outstanding common stock or if a person or group that currently beneficially owns 15% or more of Wendy’s outstanding common stock acquires beneficial ownership of additional shares, in each case, without the approval of the Board of Directors or the Independent Committee. The Rights Plan does not aggregate the ownership of shareholders “acting in concert” unless and until they have formed a group under applicable securities laws. In the event that the rights become exercisable due to the triggering ownership threshold being crossed, each right will entitle its holder (not including the person or group triggering the Rights Plan, whose rights will become null and void) to purchase, at the then-current exercise price, additional shares of common stock of the Company having a then-current market value of twice the exercise price of the right, or the Company may exchange each right held by such holders for one share of common stock. The Rights Plan does not contain any dead-hand, slow-hand, no-hand or similar feature that limits the ability of a future board of directors to redeem the rights.
The Rights Plan is effective immediately and has a one-year duration, expiring on November 3, 2027. The Board may consider an earlier termination of the Rights Plan as circumstances warrant.
Additional details about the Rights Plan are available in a Form 8-K to be filed by Wendy’s with the U.S. Securities and Exchange Commission.
The Independent Committee will continue to take actions that it determines are in the best interests of Wendy’s and its shareholders. The Company does not intend to comment further on this matter unless it determines that additional disclosure is appropriate or required.
Morgan Stanley & Co. LLC and Goldman Sachs & Co. LLC are acting as financial advisors to the Independent Committee, and Simpson Thacher & Bartlett LLP is acting as legal counsel to the Independent Committee. Kirkland & Ellis LLP is serving as legal advisor to the Company.
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Forward-Looking Statements
This press release contains certain statements that are not historical facts, including statements regarding the Company’s strategic areas of focus and future performance under the Dave’s Way plan, as well as the Proposal and the benefits of the Rights Plan. Those statements, as well as statements preceded by, followed by, or that include the words “will,” “may,” “believes,” “intends,” “plans,” “expects,” “anticipates,” or similar expressions constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 (the “Reform Act”). The forward-looking statements are based on the Company’s expectations at the time, speak only as of the dates they are made and are susceptible to a number of risks, uncertainties and other factors that may cause our actual results, performance or achievements to differ materially from those expressed or implied in any forward-looking statement. These factors include, but are not limited to, the factors identified in the “Special Note Regarding Forward-Looking Statements and Projections” and “Risk Factors” sections of our Annual Reports on Form 10-K and Quarterly Reports on Form 10-Q and in our other filings with the Securities and Exchange Commission. For all forward-looking statements, the Company claims the protection of the safe harbor for forward-looking statements contained in the Reform Act.
About Wendy’s The Wendy’s Company (Nasdaq: WEN) and Wendy’s® franchisees employ hundreds of thousands of people across more than 7,000 restaurants worldwide. Founded in 1969, Wendy’s is committed to the promise of Fresh Famous Food, Made Right, For You, delivered to customers through its craveable menu including made-to-order square hamburgers using fresh beef*, and fan favorites like the Spicy Chicken Sandwich and nuggets, Baconator®, and the Frosty® dessert. Wendy’s supports the Dave Thomas Foundation for Adoption®, established by its founder, which seeks to dramatically increase the number of adoptions of children waiting in North America’s foster care system. Learn more about Wendy’s at www.wendys.com. For details on franchising, visit www.wendys.com/franchising. Connect with Wendy’s on X, Instagram and Facebook.
| * | Fresh beef available in the contiguous U.S. and Alaska, as well as Canada, Mexico, Puerto Rico, the UK, and other select international markets. |
Investor Contact:
Aaron Broholm
Head of Investor Relations
(614) 764-3345; aaron.broholm@wendys.com
Media Contact:
Heidi Schauer
Vice President – Communications, Public Affairs & Customer Care
(614) 764-3368; heidi.schauer@wendys.com
Nick Lamplough / Clayton Erwin
Collected Strategies
Wendys-CS@collectedstrategies.com
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