Item 1.01
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Entry into a Material Definitive Agreement.
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On June 15, 2021, The Wendy’s Company (the “Company”) and certain of its direct and indirect wholly owned subsidiaries, Wendy’s International, LLC, an Ohio limited liability company (“Wendy’s International”), Wendy’s Funding, LLC, a Delaware limited liability company (the “Master Issuer”), Wendy’s SPV Guarantor, LLC, a Delaware limited liability company (“Wendy’s SPV Guarantor”), Quality Is Our Recipe, LLC, a Delaware limited liability company (“Quality”), and Wendy’s Properties, LLC, a Delaware limited liability company (“Wendy’s Properties” and, together with the Company, Wendy’s International, the Master Issuer, Wendy’s SPV Guarantor and Quality, the “Wendy’s Parties”), entered into a Purchase Agreement (the “Purchase Agreement”) with certain initial purchasers named therein (the “Initial Purchasers”), pursuant to which, among other things, the Master Issuer, a special purpose subsidiary of the Company, has agreed to issue and sell $450 million of its Series 2021-1 2.370% Fixed Rate Senior Secured Notes, Class A-2-I (the “Class A-2-I Notes”) and $650 million of its Series 2021-1 2.775% Fixed Rate Senior Secured Notes, Class A-2-II (the “Class A-2-II Notes” and, together with the Class A-2-I Notes, the “2021 Notes”), in a privately placed securitization transaction under a new supplement to the base indenture dated as of June 1, 2015 by and between the Master Issuer and Citibank, N.A. as trustee and securities intermediary.
Interest payments on the 2021 Notes are payable on a quarterly basis. The anticipated repayment dates of the Class A-2-I Notes and the Class A-2-II Notes will be March 2029 and June 2031, respectively, unless earlier prepaid to the extent permitted under the indenture that will govern the 2021 Notes. If the Master Issuer has not repaid or redeemed the 2021 Notes prior to the respective anticipated repayment dates, additional interest will accrue on the 2021 Notes equal to the greater of (A) 5.00% per annum and (B) a per annum interest rate equal to the amount, if any, by which the sum of (i) the yield to maturity (adjusted to a quarterly bond-equivalent basis) on such anticipated repayment date of the United States Treasury Security having a term closest to ten (10) years, plus (ii) 5.00%, plus (iii)(1) with respect to the Series 2021-1 Class A-2-I Notes, 1.15%, and (2) with respect to the Series 2021-1 Class A-2-II Notes, 1.35%, exceeds the original interest rate with respect to such tranche.
The Purchase Agreement includes customary representations, warranties and covenants by the Wendy’s Parties. It also provides that the Wendy’s Parties will indemnify the Initial Purchasers against certain liabilities, including liabilities under the Securities Act of 1933, as amended (the “Securities Act”). The closing of the sale of the 2021 Notes is anticipated to occur by the end of the second quarter of 2021 and is subject to the satisfaction of various closing conditions specified in the Purchase Agreement.
Certain of the Initial Purchasers and their respective affiliates have, from time to time, performed and may in the future perform various investment banking services for the Company for which they received or will receive customary fees and expenses.
The foregoing description of the Purchase Agreement does not purport to be complete and is subject to, and qualified in its entirety by, reference to the Purchase Agreement, a copy of which is attached hereto as Exhibit 10.1.
The 2021 Notes have not been and will not be registered under the Securities Act and may not be offered or sold in the United States absent such registration or an exemption from the registration requirements of the Securities Act. This report shall not constitute an offer to sell or a solicitation of an offer to buy the 2021 Notes or any other security and shall not constitute an offer, solicitation or sale of the 2021 Notes or any other security in any jurisdiction where such an offering or sale would be unlawful. This report contains information about pending transactions and anticipated timing for the closing of such transactions, and there can be no assurance regarding the timing of the closing or that these transactions will be completed.