Guarantor/Non-Guarantor

(Wendy’s Restaurants)

Wendy’s Restaurants is the issuer of, and certain of its domestic subsidiaries have guaranteed amounts outstanding under, our 10% senior notes. Each of the guaranteeing subsidiaries is a direct or indirect 100% owned subsidiary of Wendy’s Restaurants and each has fully and unconditionally guaranteed the 10% senior notes on a joint and several basis.

As a result of the closing of the sale of Arby’s on July 4, 2011 as described in Note 2, Arby’s and its subsidiaries are no longer guaranteeing subsidiaries of the amounts outstanding under the 10% senior notes. Accordingly, the condensed consolidating financial statements presented below have been retroactively revised to reflect Arby’s and its subsidiaries as non-guarantors for all periods presented. Information related to Arby’s has been reflected as discontinued operations in the condensed consolidating statements of operations for the period from January 3, 2011 through July 3, 2011 and the three months and nine months ended October 3, 2010. Arby’s cash flows prior to its sale (for the period from January 3, 2011 through July 3, 2011 and for the nine months ended October 3, 2010) have been included in, and not separately reported from, all our cash flows.

The following are included in the presentation of our: (1) Condensed Consolidating Balance Sheets as of October 2, 2011 and January 2, 2011, (2) Condensed Consolidating Statements of Operations for the three months and nine months ended October 2, 2011 and October 3, 2010, and (3) Condensed Consolidating Statements of Cash Flows for the nine months ended October 2, 2011 and October 3, 2010 to reflect:

(a)Wendy’s Restaurants (the “Parent”);

(b)the 10% senior notes guarantor subsidiaries as a group;

(c)the 10% senior notes non-guarantor subsidiaries as a group;

(d)elimination entries necessary to combine the Parent with the guarantor and non-guarantor subsidiaries; and

(e)Wendy’s Restaurants on a consolidated basis.

Substantially all of our domestic restricted subsidiaries are guarantors of the 10% senior notes. Certain of our subsidiaries, including our foreign subsidiaries and national advertising funds, do not guarantee the 10% senior notes.

For purposes of presentation of such consolidating information, investments in subsidiaries are accounted for by the Parent on the equity method. The elimination entries are principally necessary to eliminate intercompany balances and transactions.

CONDENSED CONSOLIDATING BALANCE SHEET

October 2, 2011



				Guarantor			Non-guarantor
	Parent			Subsidiaries			Subsidiaries			Eliminations			Total
ASSETS
Current assets:
Cash and cash equivalents	$	142,319		$	160,985		$	42,213		$	—		$	345,517
Accounts and notes receivable	4,841			62,437			3,530			—			70,808
Inventories	—			11,525			983			—			12,508
Prepaid expenses and other current assets	4,809			17,339			1,237			—			23,385
Deferred income tax benefit	37,781			20,927			1,050			—			59,758
Advertising funds restricted assets	—			—			72,116			—			72,116
Total current assets	189,750			273,213			121,129			—			584,092
Properties	11,395			1,087,765			53,457			—			1,152,617
Goodwill	—			826,962			46,016			—			872,978
Other intangible assets	18,480			1,266,698			24,026			—			1,309,204
Investments	19,000			—			95,609			—			114,609
Deferred costs and other assets	27,871			39,760			248			—			67,879
Net investment in subsidiaries	2,479,879			242,444			—			(2,722,323		)	—
Deferred income tax benefit	54,877			—			—			(54,877		)	—
Due from affiliate	67,705			—			—			(67,705		)	—
Total assets	$	2,868,957		$	3,736,842		$	340,485		$	(2,844,905	)	$	4,101,379

LIABILITIES AND INVESTED EQUITY
Current liabilities:
Current portion of long-term debt	$	5,465		$	915		$	271		$	—		$	6,651
Accounts payable	12,262			50,552			6,343			—			69,157
Accrued expenses and other current liabilities	40,279			144,004			9,227			—			193,510
Advertising funds restricted liabilities	—			—			72,116			—			72,116
Total current liabilities	58,006			195,471			87,957			—			341,434
Long-term debt	1,016,888			318,136			3,466			—			1,338,490
Due to affiliates	—			83,489			3,617			(67,705		)	19,401
Deferred income	—			12,765			372			—			13,137
Deferred income taxes	—			541,504			15,971			(54,877		)	502,598
Other liabilities	4,550			84,123			8,133			—			96,806
Invested equity:
Member interest, $0.01 par value; 1,000 shares authorized, one share issued and outstanding	—			—			—			—			—
Other capital	2,436,432			2,417,177			197,630			(2,614,807		)	2,436,432
(Accumulated deficit) retained earnings	(487,186		)	243,910			28,072			(271,982		)	(487,186		)
Advances to The Wendy’s Company	(155,000		)	(155,000		)	—			155,000			(155,000		)
Accumulated other comprehensive loss	(4,733		)	(4,733		)	(4,733		)	9,466			(4,733		)
Total invested equity	1,789,513			2,501,354			220,969			(2,722,323		)	1,789,513
Total liabilities and invested equity	$	2,868,957		$	3,736,842		$	340,485		$	(2,844,905	)	$	4,101,379

CONDENSED CONSOLIDATING BALANCE SHEET

January 2, 2011



				Guarantor			Non-guarantor
	Parent			Subsidiaries			Subsidiaries			Eliminations			Total
ASSETS
Current assets:
Cash and cash equivalents	$	79,355		$	53,810		$	65,521		$	—		$	198,686
Accounts and notes receivable	320			61,508			21,524			—			83,352
Inventories	—			12,522			10,172			—			22,694
Prepaid expenses and other current assets	3,900			12,434			7,698			—			24,032
Deferred income tax benefit	17,634			20,926			6,507			—			45,067
Advertising funds restricted assets	—			—			76,553			—			76,553
Total current assets	101,209			161,200			187,975			—			450,384
Properties	13,748			1,084,546			443,559			—			1,541,853
Goodwill	—			823,539			65,382			—			888,921
Other intangible assets	21,453			1,285,615			51,506			—			1,358,574
Investments	—			—			102,406			—			102,406
Deferred costs and other assets	32,610			32,384			9,565			—			74,559
Net investment in subsidiaries	2,559,526			381,828			—			(2,941,354		)	—
Deferred income tax benefit	86,423			—			—			(86,423		)	—
Due from affiliate	59,618			—			—			(59,618		)	—
Total assets	$	2,874,587		$	3,769,112		$	860,393		$	(3,087,395	)	$	4,416,697

LIABILITIES AND INVESTED EQUITY
Current liabilities:
Current portion of long-term debt	$	5,228		$	687		$	11,132		$	—		$	17,047
Accounts payable	4,624			52,242			24,282			—			81,148
Accrued expenses and other current liabilities	38,871			128,089			77,340			—			244,300
Advertising funds restricted liabilities	—			—			76,553			—			76,553
Total current liabilities	48,723			181,018			189,307			—			419,048
Long-term debt	1,043,623			310,339			188,722			—			1,542,684
Due to affiliates	—			60,653			29,773			(59,618		)	30,808
Deferred income	—			6,291			5,169			—			11,460
Deferred income taxes	—			541,800			23,095			(86,423		)	478,472
Other liabilities	5,611			86,993			64,991			—			157,595
Invested equity:
Member interest, $0.01 par value; 1,000 shares authorized, one share issued and outstanding	—			—			—			—			—
Other capital	2,423,459			3,244,488			1,077,762			(4,322,250		)	2,423,459
Accumulated deficit	(499,500		)	(515,141		)	(726,097		)	1,241,238			(499,500		)
Advances to The Wendy’s Company	(155,000		)	(155,000		)	—			155,000			(155,000		)
Accumulated other comprehensive income	7,671			7,671			7,671			(15,342		)	7,671
Total invested equity	1,776,630			2,582,018			359,336			(2,941,354		)	1,776,630
Total liabilities and invested equity	$	2,874,587		$	3,769,112		$	860,393		$	(3,087,395	)	$	4,416,697

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS

For the three months ended October 2, 2011



				Guarantor			Non-guarantor
	Parent			Subsidiaries			Subsidiaries			Eliminations			Total

Revenues:
Sales	$	—		$	472,289		$	62,236		$	—		$	534,525
Franchise revenues	—			71,735			5,156			—			76,891
	—			544,024			67,392			—			611,416

Costs and expenses:
Cost of sales	—			404,920			53,080			—			458,000
General and administrative	11,251			47,418			4,063			—			62,732
Transaction related costs	25,317			—			(1,746		)	—			23,571
Depreciation and amortization	2,859			25,206			2,693			—			30,758
Other operating expense (income), net	—			2,678			(2,316		)	—			362
	39,427			480,222			55,774			—			575,423
Operating (loss) profit	(39,427		)	63,802			11,618			—			35,993
Interest expense	(22,234		)	(5,822		)	(115		)	—			(28,171		)
Other income (expense), net	136			4,260			(4,095		)	—			301
Equity in income of subsidiaries	42,734			5,377			—			(48,111		)	—
(Loss) income from continuing operations before income taxes	(18,791		)	67,617			7,408			(48,111		)	8,123
Benefit from (provision for) income taxes	22,260			(23,442		)	(2,031		)	—			(3,213		)
Income from continuing operations	3,469			44,175			5,377			(48,111		)	4,910
Discontinued operations:
Income (loss) from discontinued operations, net of income taxes	—			—			(1,441		)	—			(1,441		)
Loss on disposal of discontinued operations, net of income taxes	(5,069		)	—			—			—			(5,069		)
Loss from discontinued operations, net of income taxes	(5,069		)	—			(1,441		)	—			(6,510		)
Net (loss) income	$	(1,600	)	$	44,175		$	3,936		$	(48,111	)	$	(1,600	)

CONDENSED CONSOLIDATING INCOME STATEMENT

For the three months ended October 3, 2010



				Guarantor			Non-guarantor
	Parent			Subsidiaries			Subsidiaries			Eliminations			Total

Revenues:
Sales	$	—		$	467,668		$	57,414		$	—		$	525,082
Franchise revenues	—			70,706			4,947			(27		)	75,626
	—			538,374			62,361			(27		)	600,708

Costs and expenses:
Cost of sales	—			402,988			48,331			—			451,319
General and administrative	—			62,739			9,621			—			72,360
Depreciation and amortization	3,116			26,397			2,661			—			32,174
Impairment of long-lived assets	—			17,213			3,708			—			20,921
Other operating expense (income), net	—			3,171			(1,618		)	—			1,553
	3,116			512,508			62,703			—			578,327
Operating (loss) profit	(3,116		)	25,866			(342		)	(27		)	22,381
Interest expense	(22,641		)	(6,000		)	(214		)	—			(28,855		)
Other income (expense), net	—			4,146			(3,912		)	—			234
Equity in income (loss) of subsidiaries	10,850			(9,395		)	—			(1,455		)	—
(Loss) income from continuing operations before income taxes	(14,907		)	14,617			(4,468		)	(1,482		)	(6,240		)
Benefit from (provision for) income taxes	15,264			(3,588		)	(4,927		)	—			6,749
Income (loss) from continuing operations	357			11,029			(9,395		)	(1,482		)	509
Discontinued operations:
Loss from discontinued operations, net of income taxes	—			—			(179		)	27			(152		)
Net income (loss)	$	357		$	11,029		$	(9,574	)	$	(1,455	)	$	357

CONDENSED CONSOLIDATING INCOME STATEMENT

For the nine months ended October 2, 2011



				Guarantor			Non-guarantor
	Parent			Subsidiaries			Subsidiaries			Eliminations			Total

Revenues:
Sales	$	—		$	1,409,928		$	178,207		$	(87	)	$	1,588,048
Franchise revenues	—			213,772			14,534			(14		)	228,292
	—			1,623,700			192,741			(101		)	1,816,340

Costs and expenses:
Cost of sales	—			1,205,511			156,158			—			1,361,669
General and administrative	11,251			170,808			25,314			—			207,373
Transaction related costs	29,542			—			—			—			29,542
Depreciation and amortization	7,886			74,572			7,932			—			90,390
Impairment of long-lived assets	—			7,890			372			—			8,262
Other operating expense (income), net	—			8,223			(6,641		)	—			1,582
	48,679			1,467,004			183,135			—			1,698,818
Operating (loss) profit	(48,679		)	156,696			9,606			(101		)	117,522
Interest expense	(67,758		)	(17,103		)	(393		)	—			(85,254		)
Other income (expense), net	136			12,291			(11,724		)	—			703
Equity in income (loss) of subsidiaries	89,796			(5,275		)	—			(84,521		)	—
(Loss) income from continuing operations before income taxes	(26,505		)	146,609			(2,511		)	(84,622		)	32,971
Benefit from (provision for) income taxes	47,668			(57,830		)	(2,764		)	—			(12,926		)
Income (loss) from continuing operations	21,163			88,779			(5,275		)	(84,622		)	20,045
Discontinued operations:
Income from discontinued operations, net of income taxes	—			—			1,017			101			1,118
Loss on disposal of discontinued operations, net of income taxes	(8,849		)	—			—			—			(8,849		)
(Loss) income from discontinued operations, net of income taxes	(8,849		)	—			1,017			101			(7,731		)
Net income (loss)	$	12,314		$	88,779		$	(4,258	)	$	(84,521	)	$	12,314

CONDENSED CONSOLIDATING INCOME STATEMENT

For the nine months ended October 3, 2010



				Guarantor			Non-guarantor
	Parent			Subsidiaries			Subsidiaries			Eliminations			Total

Revenues:
Sales	$	—		$	1,400,788		$	169,452		$	—		$	1,570,240
Franchise revenues	—			208,415			14,228			(27		)	222,616
	—			1,609,203			183,680			(27		)	1,792,856

Costs and expenses:
Cost of sales	—			1,179,325			145,645			—			1,324,970
General and administrative	—			191,457			33,749			—			225,206
Depreciation and amortization	9,341			77,983			7,731			—			95,055
Impairment of long-lived assets	—			17,695			3,708			—			21,403
Other operating expense (income), net	—			8,315			(5,428		)	—			2,887
	9,341			1,474,775			185,405			—			1,669,521
Operating (loss) profit	(9,341		)	134,428			(1,725		)	(27		)	123,335
Interest expense	(56,263		)	(23,132		)	(9,357		)	—			(88,752		)
Loss on early extinguishment of debt	—			(20,430		)	(5,767		)	—			(26,197		)
Other income (expense), net	157			12,293			(11,451		)	—			999
Equity in income (loss) of subsidiaries	26,830			(38,142		)	—			11,312			—
(Loss) income from continuing operations before income taxes	(38,617		)	65,017			(28,300		)	11,285			9,385
Benefit from (provision for) income taxes	45,789			(32,597		)	(9,842		)	—			3,350
Income (loss) from continuing operations	7,172			32,420			(38,142		)	11,285			12,735
Discontinued operations:
Loss from discontinued operations, net of income taxes	—			—			(5,590		)	27			(5,563		)
Net income (loss)	$	7,172		$	32,420		$	(43,732	)	$	11,312		$	7,172

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

For the nine months ended October 2, 2011



				Guarantor			Non-guarantor
	Parent			Subsidiaries			Subsidiaries			Eliminations			Total
Cash flows from operating activities:
Net income (loss)	$	12,314		$	88,779		$	(4,258	)	$	(84,521	)	$	12,314
Adjustments to reconcile net income (loss) to net cash (used in) provided by operating activities:
Equity in (income) loss from operations of subsidiaries	(89,796		)	5,275			—			84,521			—
Depreciation and amortization	7,886			74,572			30,045			—			112,503
Net receipt of deferred vendor incentives	—			6,789			7,087			—			13,876
Share-based compensation provision	8,480			3,821			672			—			12,973
Distributions received from joint venture	—			—			10,784			—			10,784
Impairment of long-lived assets	—			7,890			1,930			—			9,820
Loss on disposal of Arby's	8,849			—			—			—			8,849
Deferred income tax provision (benefit), net	8,856			(826		)	570			—			8,600
Non-cash rent expense (credit)	—			6,434			(268		)	—			6,166
Accretion of long-term debt	1,590			4,383			164			—			6,137
Write-off and amortization of deferred financing costs	4,854			—			—			—			4,854
Tax sharing (receivable from) payable to affiliate, net	(57,495		)	59,932			—			—			2,437
(Recovery of) provision for doubtful accounts	—			(319		)	2,323			—			2,004
Tax sharing receipt from (payment to) affiliate, net	36,000			(36,000		)	—			—			—
Other operating transactions with affiliates	58,509			(2,651		)	(60,224		)	—			(4,366		)
Equity in earnings in joint ventures, net	—			—			(7,817		)	—			(7,817		)
Tax sharing payment to The Wendy's Company	(13,078		)	—			—			—			(13,078		)
Other, net	(948		)	2,342			(1,203		)	—			191
Changes in operating assets and liabilities:
Accounts and notes receivable	(806		)	(1,891		)	(3,967		)	—			(6,664		)
Inventories	(6		)	1,031			(1,235		)	—			(210		)
Prepaid expenses and other current assets	(1,727		)	(3,551		)	(3,242		)	—			(8,520		)
Accounts payable	2,370			527			6,063			—			8,960
Accrued expenses and other current liabilities	(6,749		)	9,037			(2,801		)	—			(513		)
Net cash (used in) provided by operating activities	(20,897		)	225,574			(25,377		)	—			179,300
Cash flows from investing activities:
Proceeds from sale of Arby's, net of Arby's cash	110,238			—			(7,076		)	—			103,162
Proceeds from dispositions	98			2,865			836			—			3,799
Capital expenditures	(7,602		)	(71,712		)	(12,599		)	—			(91,913		)
Restaurant acquisitions	—			(6,613		)	—			—			(6,613		)
Franchise incentive loans	—			(1,269		)	—			—			(1,269		)
Investment in joint venture	—			(1,183		)	—			—			(1,183		)
Other, net	—			—			(245		)	—			(245		)
Net cash provided by (used in) investing activities	102,734			(77,912		)	(19,084		)	—			5,738
Cash flows from financing activities:
Repayments of long-term debt	(28,816		)	(487		)	(6,291		)	—			(35,594		)
Capital contribution from Parent	(30,000		)	—			30,000			—			—
Dividend paid to Parent	40,000			(40,000		)	—			—			—
Deferred financing costs	(57		)	—			—			—			(57		)
Net cash (used in) provided by financing activities	(18,873		)	(40,487		)	23,709			—			(35,651		)
Net cash provided by (used in) operations before effect of exchange rate changes on cash	62,964			107,175			(20,752		)	—			149,387
Effect of exchange rate changes on cash	—			—			(2,556		)	—			(2,556		)
Net increase (decrease) in cash and cash equivalents	62,964			107,175			(23,308		)	—			146,831
Cash and cash equivalents at beginning of period	79,355			53,810			65,521			—			198,686
Cash and cash equivalents at end of period	$	142,319		$	160,985		$	42,213		$	—		$	345,517

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

For the nine months ended October 3, 2010



				Guarantor			Non-guarantor
	Parent			Subsidiaries			Subsidiaries			Eliminations			Total
Cash flows from operating activities:
Net income (loss)	$	7,172		$	32,420		$	(43,732	)	$	11,312		$	7,172
Adjustments to reconcile net income (loss) to net cash (used in) provided by operating activities:
Equity in (income) loss from operations of subsidiaries	(26,830		)	38,142			—			(11,312		)	—
Depreciation and amortization	9,341			77,983			48,727			—			136,051
Impairment of long-lived assets	—			17,695			23,729			—			41,424
Accretion of long-term debt	1,229			11,571			213			—			13,013
Write-off and amortization of deferred financing costs	3,133			—			7,245			—			10,378
Net receipt of deferred vendor incentives	—			5,009			5,087			—			10,096
Share-based compensation provision	2,950			4,330			2,561			—			9,841
Distributions received from joint venture	—			—			9,718			—			9,718
Non-cash rent expense (credit)	—			7,227			(75		)	—			7,152
Provision for doubtful accounts	—			2,163			5,423			—			7,586
Tax sharing receipt from (payment to) affiliate, net	32,000			(32,000		)	—			—			—
Tax sharing (receivable from) payable to affiliate, net	(38,855		)	30,182			—			—			(8,673		)
Equity in earnings in joint venture	—			—			(7,127		)	—			(7,127		)
Other operating transactions with affiliates	(734		)	(30,430		)	24,333			—			(6,831		)
Deferred income tax benefit, net	(1,485		)	(3,433		)	—			—			(4,918		)
Other, net	2,527			1,402			(5,660		)	—			(1,731		)
Changes in operating assets and liabilities net:
Accounts and notes receivable	(42		)	3,042			(9,721		)	—			(6,721		)
Inventories	—			570			1,254			—			1,824
Prepaid expenses and other current assets	1,185			(4,077		)	(4,494		)	—			(7,386		)
Accounts payable	712			(3,875		)	(4,126		)	—			(7,289		)
Accrued expenses and other current liabilities	(25,060		)	(9,895		)	2,339			—			(32,616		)
Net cash (used in) provided by operating activities	(32,757		)	148,026			55,694			—			170,963
Cash flows from investing activities:
Capital expenditures	(12,890		)	(40,237		)	(41,609		)	—			(94,736		)
Proceeds from dispositions	—			2,174			2,220			—			4,394
Other, net	—			—			1,369			—			1,369
Net cash used in investing activities	(12,890		)	(38,063		)	(38,020		)	—			(88,973		)
Cash flows from financing activities:
Proceeds from long-term debt	497,500			—			161			—			497,661
Repayments of long-term debt	(1,411		)	(200,551		)	(260,869		)	—			(462,831		)
Dividends paid to The Wendy’s Company	(68,700		)	(361,000		)	(14,000		)	—			(443,700		)
Capital contributions from Parent	(474,569		)	215,000			259,569			—			—
Redemption of preferred stock	—			19,877			(19,877		)	—			—
Deferred financing costs	(16,286		)	—			—			—			(16,286		)
Net cash used in financing activities	(63,466		)	(326,674		)	(35,016		)	—			(425,156		)
Net cash used in operations before effect of exchange rate changes on cash	(109,113		)	(216,711		)	(17,342		)	—			(343,166		)
Effect of exchange rate changes on cash	—			—			894			—			894
Net decrease in cash and cash equivalents	(109,113		)	(216,711		)	(16,448		)	—			(342,272		)
Cash and cash equivalents at beginning of period	237,607			255,230			46,027			—			538,864
Cash and cash equivalents at end of period	$	128,494		$	38,519		$	29,579		$	—		$	196,592