System Optimization Gains, Net (Tables)

12 Months Ended

Jan. 02, 2022

System optimization gains, net

Summary of Disposition Activity

	Year End
	January 2, 2022		January 3, 2021
Land	$	370,742	$	372,473
Buildings and improvements	504,462		504,504
Leasehold improvements	422,094		409,306
Office, restaurant and transportation equipment	282,770		255,469
	1,580,068		1,541,752
Accumulated depreciation and amortization	(673,201)		(625,863)
	$	906,867	$	915,889

Assets Held for Sale

	Year End
	January 2, 2022		January 3, 2021
Number of restaurants classified as held for sale	—		43
Net restaurant assets held for sale (a)	$	—	$	20,587
Other assets held for sale (b)	$	3,541	$	1,732

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(a)Net restaurant assets held for sale as of January 3, 2021 included New York Company-operated restaurants (excluding Manhattan) and consisted primarily of cash, inventory, property and an estimate of allocable goodwill. During the three months ended April 4, 2021, the Company also classified its four Manhattan restaurants as held for sale.

(b)Other assets held for sale primarily consist of surplus properties.

System Optimization

System optimization gains, net

Summary of Disposition Activity

The following is a summary of the disposition activity recorded as a result of our system optimization initiative:

	Year Ended
	2021		2020		2019
Number of restaurants sold to franchisees	47		1		—
Proceeds from sales of restaurants (a)	$	50,518	$	50	$	—
Net assets sold (b)	(16,939)		(34)		—
Goodwill related to sales of restaurants	(4,847)		—		—
Net unfavorable leases (c)	(2,939)		—		—
Gain on sales-type leases	7,156		—		—
Other (d)	(2,148)		—		—
	30,801		16		—
Post-closing adjustments on sales of restaurants (e) (f)	1,218		362		1,087
Gain on sales of restaurants, net	32,019		378		1,087
Gain on sales of other assets, net (g)	1,526		2,770		196
System optimization gains, net	$	33,545	$	3,148	$	1,283

_______________

(a)In addition to the proceeds noted herein, the Company received cash proceeds of $39 during 2021 related to a note receivable issued in connection with the sale of the Manhattan Company-operated restaurants.

(b)Net assets sold consisted primarily of equipment.

(c)During 2021, the Company recorded favorable lease assets of $3,799 and unfavorable lease liabilities of $6,738 as a result of leasing and/or subleasing land, buildings and/or leasehold improvements to franchisees, in connection with the sale of the New York Company-operated restaurants (including Manhattan).

(d)2021 includes a deferred gain of $3,500 as a result of certain contingencies related to the extension of lease terms.

(e)2021 includes a gain on sales-type leases of $1,625 and the write-off of certain lease assets of $927 as a result of an amendment to lease terms in connection with a Manhattan Company-operated restaurant previously sold to a franchisee.

(f)2021, 2020 and 2019 include the recognition of deferred gains of $515, $368 and $911, respectively, as a result of the resolution of certain contingencies related to the extension of lease terms for restaurants previously sold to franchisees.

(g)During 2021, 2020 and 2019, Wendy’s received cash proceeds of $4,561, $6,041 and $3,448, respectively, primarily from the sale of surplus and other properties.