10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

For the Quarterly Period Ended September 25, 2013

Commission File Number 0-18051

DENNY’S CORPORATION

(Exact name of registrant as specified in its charter)

Delaware	13-3487402
(State or other jurisdiction of	(I.R.S. Employer
incorporation or organization	Identification No.)

203 East Main Street

Spartanburg, South Carolina 29319-0001

(Address of principal executive offices)

(Zip Code)

(864) 597-8000

(Registrant’s telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes  R    No  £

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).

Yes  R    No  £

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	£	Accelerated filer	R	Non-accelerated filer	£	Smaller reporting company	£
				(Do not check if a smaller reporting company)

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes  £   No  R

 As of October 24, 2013, 89,237,478 shares of the registrant’s common stock, par value $.01 per share, were outstanding.

TABLE OF CONTENTS

	Page
Part I - FINANCIAL INFORMATION
Item 1.   Financial Statements
Condensed Consolidated Balance Sheets (Unaudited)	3
Condensed Consolidated Statements of Comprehensive Income
Quarter and Three Quarters Ended September 25, 2013 and September 26, 2012 (Unaudited)	4
Condensed Consolidated Statement of Shareholders' Equity (Unaudited)	5
Condensed Consolidated Statements of Cash Flows (Unaudited)	6
Notes to Condensed Consolidated Financial Statements (Unaudited)	7
Item 2.   Management’s Discussion and Analysis of Financial Condition and Results of Operations	16
Item 3.   Quantitative and Qualitative Disclosures About Market Risk	27
Item 4.   Controls and Procedures	28
PART II - OTHER INFORMATION
Item 1.   Legal Proceedings	28
Item 2.   Unregistered Sales of Equity Securities and Use of Proceeds	28
Item 6.   Exhibits	29
Signatures	30

2

PART I - FINANCIAL INFORMATION

Item 1.     Financial Statements

Denny’s Corporation and Subsidiaries

Condensed Consolidated Balance Sheets

(Unaudited)

	September 25, 2013			December 26, 2012
	(In thousands)
Assets
Current assets:
Cash and cash equivalents	$	6,330		$	13,565
Receivables	14,167			19,947
Inventories	2,890			2,890
Current deferred tax asset	20,962			19,807
Prepaid and other current assets	6,111			8,401
Total current assets	50,460			64,610
Property, net of accumulated depreciation of $251,617 and $250,173 respectively	105,174			107,004
Goodwill	31,451			31,430
Intangible assets, net	48,479			48,920
Deferred financing costs, net	2,216			2,041
Noncurrent deferred tax asset	34,829			45,776
Other noncurrent assets	27,300			25,104
Total assets	$	299,909		$	324,885
Liabilities
Current liabilities:
Current maturities of long-term debt	$	3,000		$	8,500
Current maturities of capital lease obligations	4,170			4,181
Accounts payable	17,009			24,461
Other current liabilities	50,228			54,682
Total current liabilities	74,407			91,824
Long-term liabilities:
Long-term debt, less current maturities	152,500			161,500
Capital lease obligations, less current maturities	15,666			15,953
Liability for insurance claims, less current portion	18,104			18,045
Other noncurrent liabilities and deferred credits	38,847			42,023
Total long-term liabilities	225,117			237,521
Total liabilities	299,524			329,345
Commitments and contingencies
Shareholders' equity
Common stock $0.01 par value; shares authorized - 135,000; September 25, 2013: 104,695 shares issued and 89,372 shares outstanding; December 26, 2012: 103,764 shares issued and 92,229 shares outstanding	$	1,047		$	1,038
Paid-in capital	566,369			562,657
Deficit	(475,208		)	(495,518		)
Accumulated other comprehensive loss, net of tax	(22,607		)	(24,999		)
Shareholders’ equity before treasury stock	69,601			43,178
Treasury stock, at cost, 15,323 and 11,535 shares, respectively	(69,216		)	(47,638		)
Total shareholders' equity (deficit)	385			(4,460		)
Total liabilities and shareholders' equity	$	299,909		$	324,885

See accompanying notes

3

Denny’s Corporation and Subsidiaries

Condensed Consolidated Statements of Comprehensive Income

(Unaudited)

	Quarter Ended					Three Quarters Ended
	September 25, 2013			September 26, 2012		September 25, 2013		September 26, 2012
	(In thousands, except per share amounts)
Revenue:
Company restaurant sales	$	83,371		$	86,575	$	247,242	$	271,977
Franchise and license revenue	33,904			34,370		101,094		100,437
Total operating revenue	117,275			120,945		348,336		372,414
Costs of company restaurant sales:
Product costs	21,722			21,449		64,270		67,684
Payroll and benefits	33,746			34,409		98,512		108,779
Occupancy	5,598			5,780		16,339		17,776
Other operating expenses	12,022			12,170		34,538		37,267
Total costs of company restaurant sales	73,088			73,808		213,659		231,506
Costs of franchise and license revenue	11,599			12,078		34,586		34,776
General and administrative expenses	13,704			14,702		42,948		45,150
Depreciation and amortization	5,198			5,287		15,774		17,174
Operating (gains), losses and other charges, net	161			3,380		1,779		(794		)
Total operating costs and expenses, net	103,750			109,255		308,746		327,812
Operating income	13,525			11,690		39,590		44,602
Interest expense, net	2,452			3,088		7,800		10,537
Other nonoperating (income) expense, net	(276		)	38		1,056		7,941
Net income before income taxes	11,349			8,564		30,734		26,124
Provision for income taxes	4,318			3,201		10,424		10,295
Net income	$	7,031		$	5,363	$	20,310	$	15,829
Basic net income per share	$	0.08		$	0.06	$	0.22	$	0.17
Diluted net income per share	$	0.08		$	0.06	$	0.22	$	0.16
Basic weighted average shares outstanding	90,035			94,705		91,348		95,472
Diluted weighted average shares outstanding	91,967			96,745		93,377		97,196
Comprehensive income	$	6,574		$	5,631	$	22,702	$	16,633

See accompanying notes

4

Denny’s Corporation and Subsidiaries

Condensed Consolidated Statement of Shareholders’ Equity

(Unaudited)

	Common Stock			Treasury Stock					Paid-in						Accumulated Other Comprehensive			Total Shareholders’ Equity /
	Shares	Amount		Shares		Amount			Capital			(Deficit)			Loss, Net			(Deficit)
	(In thousands)
Balance, December 26, 2012	103,764	$	1,038	(11,535	)	$	(47,638	)	$	562,657		$	(495,518	)	$	(24,999	)	$	(4,460	)
Net income	—	—		—		—			—			20,310			—			20,310
Recognition of unrealized gain on hedged transactions, net of tax expense of $1,063	—	—		—		—			—			—			1,640			1,640
Minimum pension liability adjustment, net of tax expense of $487	—	—		—		—			—			—			752			752
Share-based compensation on equity classified awards	—	—		—		—			1,848			—			—			1,848
Purchase of treasury stock	—	—		(3,788	)	(21,578		)	—			—			—			(21,578		)
Issuance of common stock for share-based compensation	300	3		—		—			(3		)	—			—			—
Exercise of common stock options	631	6		—		—			2,071			—			—			2,077
Tax expense from stock options exercised	—	—		—		—			(204		)	—			—			(204		)
Balance, September 25, 2013	104,695	$	1,047	(15,323	)	$	(69,216	)	$	566,369		$	(475,208	)	$	(22,607	)	$	385

See accompanying notes

5

Denny’s Corporation and Subsidiaries

Condensed Consolidated Statements of Cash Flows

(Unaudited)

	Three Quarters Ended
	September 25, 2013			September 26, 2012
	(In thousands)
Cash flows from operating activities:
Net income	$	20,310		$	15,829
Adjustments to reconcile net income to cash flows provided by operating activities:
Depreciation and amortization	15,774			17,174
Operating (gains), losses and other charges, net	1,779			(794		)
Amortization of deferred financing costs	376			639
Amortization of debt discount	—			137
Loss on early extinguishment of debt	1,798			8,180
Loss on change in the fair value of interest rate caps	28			62
Deferred income tax expense	8,241			8,988
Share-based compensation	3,434			2,794
Changes in assets and liabilities:
Decrease (increase) in assets:
Receivables	3,519			1,034
Inventories	—			592
Other current assets	2,291			3,885
Other assets	(1,399		)	(2,549		)
Increase (decrease) in liabilities:
Accounts payable	(3,461		)	(4,548		)
Accrued salaries and vacations	(3,089		)	1,246
Accrued taxes	1,823			1,140
Other accrued liabilities	(4,015		)	(5,725		)
Other noncurrent liabilities and deferred credits	(2,693		)	(4,061		)
Net cash flows provided by operating activities	44,716			44,023
Cash flows from investing activities:
Capital expenditures	(11,819		)	(7,846		)
Acquisition of restaurants	(1,622		)	—
Proceeds from disposition of property	1,591			14,168
Collections on notes receivable	3,653			1,642
Issuance of notes receivable	(1,232		)	(1,652		)
Net cash flows (used in) provided by investing activities	(9,429		)	6,312
Cash flows from financing activities:
Net revolver borrowings under new credit agreement	97,000			—
Term loan borrowings under new credit agreement	60,000			190,000
Long-term debt payments	(174,820		)	(215,590		)
Proceeds from exercise of stock options	2,077			2,123
Tax withholding on share-based payments	(464		)	(327		)
Tax (expense) benefit of stock options exercised	(204		)	648
Debt transaction costs	(366		)	(1,098		)
Deferred financing costs	(1,372		)	(1,809		)
Purchase of treasury stock	(21,952		)	(10,442		)
Net bank overdrafts	(2,421		)	(3,432		)
Net cash flows used in financing activities	(42,522		)	(39,927		)
(Decrease) increase in cash and cash equivalents	(7,235		)	10,408
Cash and cash equivalents at beginning of period	13,565			13,740
Cash and cash equivalents at end of period	$	6,330		$	24,148

See accompanying notes

6

Denny’s Corporation and Subsidiaries

Notes to Condensed Consolidated Financial Statements

(Unaudited)

Note 1.     Introduction and Basis of Presentation

Denny’s Corporation, or Denny’s, is one of America’s largest full-service restaurant chains based on number of restaurants. The following table shows the unit activity for the quarter and three quarters endedSeptember 25, 2013 and September 26, 2012, respectively:

	Quarter Ended				Three Quarters Ended
	September 25, 2013		September 26, 2012		September 25, 2013		September 26, 2012
Company restaurants, beginning of period	165		177		164		206
Units opened	—		—		—		—
Units acquired from franchisees	1		—		2		—
Units sold to franchisees	(2	)	(5	)	(2	)	(28	)
Units closed	—		(1	)	—		(7	)
End of period	164		171		164		171
Franchised and licensed restaurants, beginning of period	1,525		1,507		1,524		1,479
Units opened	9		12		27		27
Units purchased from Company	2		5		2		28
Units acquired by Company	(1	)	—		(2	)	—
Units closed	(13	)	(8	)	(29	)	(18	)
End of period	1,522		1,516		1,522		1,516
Total restaurants, end of period	1,686		1,687		1,686		1,687

Our unaudited condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission. Therefore, certain information and notes normally included in financial statements prepared in accordance with U.S. generally accepted accounting principles have been condensed or omitted. In our opinion, all adjustments considered necessary for a fair presentation of the interim periods presented have been included. Such adjustments are of a normal and recurring nature. The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities. Actual results may differ from these estimates under different assumptions or conditions; however, we believe that our estimates, including those for the above-described items, are reasonable.

These interim condensed consolidated financial statements should be read in conjunction with our consolidated financial statements and notes thereto for the year ended December 26, 2012 and the related Management’s Discussion and Analysis of Financial Condition and Results of Operations, both of which are contained in our Annual Report on Form 10-K for the fiscal year ended December 26, 2012. The results of operations for the interim periods presented are not necessarily indicative of the results for the entire fiscal year ending December 25, 2013.

7

Note 2.     Summary of Significant Accounting Policies

Newly Adopted Accounting Standards

Intangibles

ASU No. 2012-02, "Intangibles—Goodwill and Other (Topic 350): Testing Indefinite-Lived Intangible Assets for Impairment”

Effective December 27, 2012, we adopted ASU 2012-02, which modifies the impairment test for indefinite-lived intangible assets. Under the new guidance, an entity is permitted to make a qualitative assessment of whether it is more likely than not that the indefinite-lived intangible asset is impaired. If it is determined through the qualitative assessment that the indefinite-lived intangible asset's fair value is more likely than not greater than its carrying value, the quantitative impairment calculations would not be required. The qualitative assessment is optional, allowing companies to go directly to the quantitative assessment. The adoption did not have any impact on our Condensed Consolidated Financial Statements.

Comprehensive Income 

ASU 2013-02, "Comprehensive Income (Topic 220): Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income"

Effective December 27, 2012, we adopted ASU 2013-02, which requires companies to provide information about the amounts reclassified out of accumulated other comprehensive income by component. In addition, companies are required to present, either on the face of the statement where net income is presented or in the notes, significant amounts reclassified out of accumulated other comprehensive income by the respective line items of net income. ASU 2013-02 is to be applied prospectively. The adoption concerns presentation and disclosure only and did not have an impact on our financial position or results of operations.

Accounting Standards to be Adopted

We reviewed all newly issued accounting pronouncements and concluded that they are either not applicable to our business or are not expected to have a material effect on the financial statements as a result of future adoption.

Note 3.     Receivables

Receivables were comprised of the following:

	September 25, 2013			December 26, 2012
	(In thousands)
Current assets:
Receivables:
Trade accounts receivable from franchisees	$	9,228		$	10,212
Notes receivable from franchisees	2,049			4,310
Vendor receivables	1,130			2,529
Credit card receivables	792			1,384
Other	1,193			1,524
Allowance for doubtful accounts	(225		)	(12		)
Total current receivables, net	$	14,167		$	19,947
Noncurrent assets (included as a component of other noncurrent assets):
Notes receivable from franchisees	$	842		$	1,002

For the quarter and three quarters ended September 25, 2013, we recorded provisions for credit losses of $0.1 million. For the quarter and three quarters ended September 26, 2012, we recorded provisions for credit losses of less than $0.1 million. These amounts are included as a component of costs of franchise and license revenue on our Condensed Consolidated Statements of Comprehensive Income.

8

For the quarters and three quarters ended September 25, 2013 and September 26, 2012, we recognized interest income on notes receivable from franchisees of less than $0.1 million. These amounts are included as a component of interest expense, net on our Condensed Consolidated Statements of Comprehensive Income.

Note 4.    Goodwill and Other Intangible Assets

The following table reflects the changes in carrying amounts of goodwill:

	(In thousands)
Balance, December 26, 2012	$	31,430
Additions related to acquisitions	28
Write-offs and reclassifications associated with sale of restaurants	(7		)
Balance, September 25, 2013	$	31,451

Other intangible assets were comprised of the following:

	September 25, 2013				December 26, 2012
	Gross Carrying Amount		Accumulated Amortization		Gross Carrying Amount		Accumulated Amortization
	(In thousands)
Intangible assets with indefinite lives:
Trade names	$	44,050	$	—	$	44,050	$	—
Liquor licenses	126		—		156		—
Intangible assets with definite lives:
Franchise and license agreements	32,993		28,733		37,524		32,863
Foreign license agreements	241		198		241		188
Intangible assets	$	77,410	$	28,931	$	81,971	$	33,051

Note 5.     Operating (Gains), Losses and Other Charges, Net

Operating (gains), losses and other charges, netare comprised of the following:

	Quarter Ended					Three Quarters Ended
	September 25, 2013			September 26, 2012		September 25, 2013			September 26, 2012
	(In thousands)
(Gains) losses on sales of assets and other, net	$	(68	)	$	91	$	(83	)	$	(6,772	)
Restructuring charges and exit costs	229			821		1,005			2,970
Impairment charges	—			2,468		857			3,008
Operating (gains), losses and other charges, net	$	161		$	3,380	$	1,779		$	(794	)

9

Restructuring Charges and Exit Costs

Restructuring charges and exit costs were comprised of the following: 

	Quarter Ended				Three Quarters Ended
	September 25, 2013		September 26, 2012		September 25, 2013		September 26, 2012
	(In thousands)
Exit costs	$	198	$	233	$	435	$	1,139
Severance and other restructuring charges	31		588		570		1,831
Total restructuring and exit costs	$	229	$	821	$	1,005	$	2,970

The components of the change in accrued exit cost liabilities are as follows:

	(In thousands)
Balance, December 26, 2012	$	4,061
Exit costs (1)	435
Payments, net of sublease receipts	(1,248		)
Interest accretion	195
Balance, September 25, 2013	3,443
Less current portion included in other current liabilities	1,228
Long-term portion included in other noncurrent liabilities	$	2,215

(1) Included as a component of operating (gains), losses and other charges, net.

Estimated net cash payments related to exit cost liabilities are as follows:

	(In thousands)
Remainder of 2013	$	270
2014	1,319
2015	545
2016	320
2017	322
Thereafter	1,338
Total	4,114
Less imputed interest	671
Present value of exit cost liabilities	$	3,443

As of September 25, 2013 and December 26, 2012, we had accrued severance and other restructuring charges of $0.1 million and $0.5 million, respectively. The balance as of September 25, 2013 is expected to be paid during the next 12 months.

Impairment charges of $0.9 million for the three quarters ended September 25, 2013 resulted primarily from the impairment of two units identified as assets held for sale. Impairment charges of $2.5 million for the quarter ended September 26, 2012 resulted primarily from the impairment of six units identified as held for sale. Impairment charges of $3.0 million for the three quarters ended September 26, 2012 resulted primarily from the impairment of seven units identified as assets held for sale and the impairment of an underperforming unit.

10

Note 6.     Fair Value of Financial Instruments

Fair Value of Assets and Liabilities Measured on a Recurring and Nonrecurring Basis

Financial assets and liabilities measured at fair value on a recurring basis are summarized below:

	Total		Quoted Prices in Active Markets for Identical Assets/Liabilities (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Valuation Technique
	(In thousands)
Fair value measurements as of September 25, 2013:
Deferred compensation plan investments (1)	$	7,730	$	7,730	$	—	$	—	market approach
Interest rate swaps (2)	$	2,704	—		2,704		—		income approach
Interest rate caps (2)	$	25	$	—	$	25	$	—	income approach
Total	$	10,459	$	7,730	$	2,729	$	—
Fair value measurements as of December 26, 2012:
Deferred compensation plan investments (1)	$	6,371	$	6,371	$	—	$	—	market approach
Interest rate caps (2)	$	8	$	—	$	8	$	—	income approach
Total	$	6,379	$	6,371	$	8	$	—

(1) The fair values of our deferred compensation plan investments are based on the closing market prices of the participants’ elected investments.

(2) The fair values of our interest rate swaps and interest rate caps are based upon Level 2 inputs which include valuation models as reported by our counterparties. The key inputs for the valuation models are quoted market prices, interest rates and forward yield curves.

Those assets and liabilities measured at fair value on a nonrecurring basis are summarized below:

	Total		Quoted Prices in Active Markets for Identical Assets/Liabilities (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Valuation Technique
	(In thousands)
Fair value measurements as of December 26, 2012:
Assets held and used (1)	$	228	$	—	$	—	$	228	income approach
Total	$	228	$	—	$	—	$	228

(1) As of December 26, 2012, impaired assets related to an underperforming restaurant were written down to their fair value. Impairment charges of $0.7 million were recognized as a component of operating (gains), losses and other charges, net in our Condensed Consolidated Statements of Comprehensive Income. To determine fair value, we used the income approach, which assumes that the future cash flows reflect current market expectations. These fair value measurements require significant judgment using Level 3 inputs, such as discounted cash flows from operations, which are not observable from the market, directly or indirectly.

11

Disclosures of Fair Value of Other Assets and Liabilities

The liabilities under our credit facility are carried at historical cost in our Condensed Consolidated Balance Sheets. As of September 25, 2013 and December 26, 2012, the estimated fair value (Level 2) of our senior secured term loan approximated its carrying value. The fair value of our long-term debt is determined based on market prices or, if market prices are not available, the present value of the underlying cash flows discounted at market rates.

Note 7.     Long-Term Debt

Refinancing of Credit Facility

On April 24, 2013, Denny's Corporation and certain of its subsidiaries refinanced our credit facility (the "Old Credit Facility") and entered into a new senior secured credit agreement in an aggregate principal amount of $250 million (the “New Credit Facility”). The New Credit Facility is comprised of a $60 million senior secured term loan and a $190 million senior secured revolver (with a $30 million letter of credit sublimit). A commitment fee of 0.35% is paid on the unused portion of the revolving credit facility. Borrowings under the New Credit Facility bear a tiered interest rate based on the Company's consolidated leverage ratio and is initially set at LIBOR plus 200 basis points. The New Credit Facility includes an accordion feature that would allow us to increase the size of the facility to $300 million. The maturity date for the New Credit Facility is April 24, 2018.

The New Credit Facility was used to refinance the Old Credit Facility and will be available for working capital, capital expenditures and other general corporate purposes. The New Credit Facility is guaranteed by the Company and its material subsidiaries and is secured by substantially all of the assets of the Company and its subsidiaries, including the stock of the Company's subsidiaries. It includes negative covenants that are usual for facilities and transactions of this type. The New Credit Facility also includes certain financial covenants with respect to a maximum consolidated leverage ratio, a minimum consolidated fixed charge coverage ratio and maximum capital expenditures.

The term loan under the New Credit Facility requires amortization of the original term loan balance of 5% per year in the first two years, 7.5% in the subsequent two years and 10% in the fifth year with the balance due at maturity. We will be required to make certain mandatory prepayments under certain circumstances and will have the option to make certain prepayments under the New Credit Facility. The New Credit Facility includes events of default (and related remedies, including acceleration and increased interest rates following an event of default) that are usual for facilities and transactions of this type.

As a result of the debt refinancing, we recorded $1.2 million of losses on early extinguishment of debt, consisting primarily of $0.4 million of transaction costs and $0.8 million from the write-off of deferred financing costs related to the Old Credit Facility. These losses are included as a component of other nonoperating expense in the condensed Consolidated Statements of Comprehensive Income.

As of September 25, 2013, we had outstanding term loan borrowings under the New Credit Facility of $58.5 million and outstanding letters of credit under the senior secured revolver of $26.0 million. There were $97.0 million of revolving loans outstanding at September 25, 2013. These balances resulted in availability of $67.0 million under the revolving facility. The weighted-average interest rate under the term loan was 2.18% and 2.97% as of September 25, 2013 and December 26, 2012, respectively. The weighted-average interest rate on outstanding revolver loans was 2.18% as of September 25, 2013.

During the three quarters ended September 25, 2013, we paid $4.0 million on the term loan under the Old Credit Facility, prior to the April 24, 2013 refinancing. Subsequent to the April 24, 2013 refinancing, we paid $1.5 million on the term loan under the New Credit Facility.

Aggregate annual maturities of long-term debt, excluding capital lease obligations, at September 25, 2013 are as follows:

	(In thousands)
Remainder of 2013	$	750
2014	3,000
2015	4,125
2016	4,500
2017 and thereafter	143,125
Total long-term debt, excluding capital lease obligations	$	155,500

12

Interest Rate Hedges

On April 13, 2012, we entered into interest rate hedges that cap the LIBOR rate on borrowings under our credit facility for a two year period. The 200 basis point LIBOR cap applied to $150 million of borrowings from April 13, 2012 through April 13, 2013 and $125 million of borrowings from April 14, 2013 through April 13, 2014.

Our existing interest rate hedges remain in effect under the New Credit Facility until April 13, 2014. On April 30, 2013, we entered into additional interest rate hedges that cap the LIBOR rate on borrowings under the New Credit Facility. The 200 basis point LIBOR cap applies to $150 million of borrowings from April 14, 2014 through March 31, 2015.

On April 30, 2013, we also entered into interest rate swaps to hedge a portion of the cash flows of our floating rate debt from March 31, 2015 through March 29, 2018. We designated the interest rate swaps as cash flow hedges of our exposure to variability in future cash flows attributable to payments of LIBOR due on a related $150 million notional debt obligation from March 31, 2015 through March 31, 2017 and a related $140 million notional debt obligation from April 1, 2017 through March 29, 2018. Under the terms of the swaps, we will pay an average fixed rate of 3.12% on the notional amounts and receive payments from a counterparty based on the 30-day LIBOR rate.

We believe that our estimated cash flows from operations for 2013, combined with our capacity for additional borrowings under our credit facility, will enable us to meet our anticipated cash requirements and fund capital expenditures over the next twelve months.

Note 8.     Defined Benefit Plans

The components of net periodic benefit cost were as follows:

	Quarter Ended						Three Quarters Ended
	September 25, 2013			September 26, 2012			September 25, 2013			September 26, 2012
	(In thousands)
Pension plan:
Service cost	$	100		$	95		$	300		$	285
Interest cost	745			800			2,233			2,400
Expected return on plan assets	(1,122		)	(1,024		)	(3,366		)	(3,042		)
Amortization of net loss	413			441			1,240			1,322
Net periodic benefit cost	$	136		$	312		$	407		$	965
Other defined benefit plans:
Interest cost	$	28		$	29		$	84		$	87
Amortization of net loss	17			13			53			39
Net periodic benefit cost	$	45		$	42		$	137		$	126

We made contributions of $2.8 million to our qualified pension plan during both the three quarters ended September 25, 2013 and September 26, 2012. We made contributions of $0.1 million to our other defined benefit plans during both the three quarters ended September 25, 2013 and September 26, 2012. We expect to contribute less than $0.1 million to our other defined benefit plans over the remainder of fiscal 2013.

During the three quarters ended September 25, 2013, we amortized $0.8 million of actuarial losses, net of tax, out of accumulated other comprehensive loss into net periodic benefit cost, which is reported as a component of general and administrative expenses in the Condensed Consolidated Statement of Comprehensive Income. Additional minimum pension liability of $24.2 million and $25.0 million is reported as a component of accumulated other comprehensive loss in the Condensed Consolidated Statement of Shareholders’ Equity as of September 25, 2013 and December 26, 2012, respectively.

13

Note 9.     Share-Based Compensation

Total share-based compensation cost included as a component of net income was as follows:

	Quarter Ended				Three Quarters Ended
	September 25, 2013		September 26, 2012		September 25, 2013		September 26, 2012
	(In thousands)
Stock options	$	136	$	200	$	433	$	692
Restricted stock units	735		778		2,377		1,752
Board deferred stock units	182		150		624		350
Total share-based compensation	$	1,053	$	1,128	$	3,434	$	2,794

Stock Options

As of September 25, 2013, we had approximately $0.2 million of unrecognized compensation cost related to unvested stock option awards outstanding, which is expected to be recognized over a weighted average of 0.3 years.

Restricted Stock Units

In January 2013, we granted approximately 0.3 million performance shares and related performance-based target cash awards of $2.1 million to certain employees. As these awards contain a market condition, a Monte Carlo valuation was used to determine the performance shares' grant date fair value of $8.05 per share and the payout probability of the target cash awards. The awards granted to our named executive officers also contain a performance condition based on certain operating measures for the fiscal year ended December 25, 2013. The performance period is the three year fiscal period beginning December 27, 2012 and ending December 30, 2015. The performance shares and cash awards will vest and be earned (from 0% to 200% of the target award for each such increment) at the end of the performance period based on the total shareholder return of our stock compared to the total shareholder returns of a group of peer companies.

During the three quarters ended September 25, 2013, we made payments of $0.9 million in cash and issued 0.3 million shares of common stock related to restricted stock unit awards.

As of September 25, 2013, we had approximately $5.0 million of unrecognized compensation cost related to all unvested restricted stock unit awards outstanding, which is expected to be recognized over a weighted average of 1.4 years.

Board Deferred Stock Units

During the three quarters ended September 25, 2013, we granted approximately 0.1 million deferred stock units (which are equity classified) with a weighted average grant date fair value of $5.95 per unit to non-employee members of our Board of Directors. A director may elect to convert these awards into shares of common stock either on a specific date in the future (while still serving as a member of the Board of Directors) or upon termination as a member of the Board of Directors. During the three quarters ended September 25, 2013, less than 0.1 million deferred stock units were converted into shares of common stock. As of September 25, 2013, we had approximately $0.4 million of unrecognized compensation cost related to all unvested deferred stock unit awards outstanding, which is expected to be recognized over a weighted average of 0.6 years.

Note 10.     Income Taxes

The provision for income taxes was $10.4 million and $10.3 million for the three quarters ended September 25, 2013 and September 26, 2012, respectively. For the 2013 period, the difference in the overall effective rate from the U.S. Statutory rate was due to state and foreign taxes, employment tax credits, and discrete tax items. The passage of the American Tax Payer Relief Act of 2012 resulted in deferred tax benefits of $0.3 million related to work opportunity credits generated in 2012, which were allowed retroactively. In addition, state jobs tax credits of $0.8 million were claimed during the 2013 period resulting from the prior year's hiring activity. A valuation allowance of $0.5 million was recorded against certain state jobs tax credits during the 2013 period related to changes in California law enacted during the period. The provision for income taxes for the 2012 period was determined using our effective rate estimated for the entire fiscal year.

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Note 11.     Net Income Per Share

The amounts used for the basic and diluted net income per share calculation are summarized below:

	Quarter Ended				Three Quarters Ended
	September 25, 2013		September 26, 2012		September 25, 2013		September 26, 2012
	(In thousands, except for per share amounts)
Net income	$	7,031	$	5,363	$	20,310	$	15,829
Weighted average shares outstanding - basic	90,035		94,705		91,348		95,472
Effect of dilutive share-based compensation awards	1,932		2,040		2,029		1,724
Weighted average shares outstanding - diluted	91,967		96,745		93,377		97,196
Basic net income per share	$	0.08	$	0.06	$	0.22	$	0.17
Diluted net income per share	$	0.08	$	0.06	$	0.22	$	0.16
Anti-dilutive share-based compensation awards	331		116		331		1,902

Note 12.     Supplemental Cash Flow Information

	Three Quarters Ended
	September 25, 2013		September 26, 2012
	(In thousands)
Income taxes paid, net	$	1,831	$	1,865
Interest paid	$	7,121	$	10,371
Noncash investing and financing activities:
Issuance of common stock, pursuant to share-based compensation plans	$	1,590	$	856
Execution of capital leases	$	4,038	$	1,581
Treasury stock payable	$	186	$	231

Note 13.     Share Repurchase

Our Old Credit Facility (as defined in Note 7) permitted and our New Credit Facility (as defined in Note 7) permits the payment of cash dividends and the purchase of Denny’s stock subject to certain limitations. In May 2012, we announced that our Board of Directors approved a share repurchase program authorizing us to repurchase up to an additional 6.0 million shares of our Common Stock (in addition to prior authorizations). Under this program, we may, from time to time, purchase shares in the open market (including pre-arranged stock trading plans in accordance with the guidelines specified in Rule 10b5-1 under the Securities Exchange Act of 1934) or in privately negotiated transactions, subject to market and business conditions. As of September 25, 2013, we had repurchased 6.0 million shares of Common Stock for approximately $31.9 million under this share repurchase program, thus completing the program.

15

On April 25, 2013, we announced that our Board of Directors approved a new share repurchase program authorizing us to repurchase up to an additional 10.0 million shares of our Common Stock. Under this program, we may, from time to time, purchase shares in the open market (including pre-arranged stock trading plans in accordance with the guidelines specified in Rule 10b5-1 under the Securities Exchange Act of 1934) or in privately negotiated transactions, subject to market and business conditions. As of September 25, 2013, we had repurchased 0.3 million shares of Common Stock for approximately $1.9 million and there were 9.7 million shares remaining to be repurchased under this share repurchase program.

For the three quarters ended September 25, 2013 we repurchased a total of 3.8 million shares of Common Stock for approximately $21.6 million under our share repurchase programs.

Note 14.     Commitments and Contingencies

There are various claims and pending legal actions against or indirectly involving us, incidental to and arising out of the ordinary course of the business. In the opinion of management, based upon information currently available, the ultimate liability with respect to these proceedings and claims will not materially affect the Company's consolidated results of operations or financial position. We record legal settlement costs as other operating expenses in our Condensed Consolidated Statements of Comprehensive Income as those costs are incurred.

Note 15.     Subsequent Events

We performed an evaluation of subsequent events and determined that no events required disclosure.

Item 2.     Management’s Discussion and Analysis of Financial Condition and Results of Operations

Forward-Looking Statements

The following discussion is intended to highlight significant changes in our financial position as of September 25, 2013 and results of operations for the quarter and three quarters ended September 25, 2013 compared to the quarter and three quarters ended September 26, 2012. The forward-looking statements included in Management's Discussion and Analysis of Financial Condition and Results of Operations, which reflect our best judgment based on factors currently known and are intended to speak only as of the date such statements are made, involve risks, uncertainties, and other factors which may cause our actual performance to be materially different from the performance indicated or implied by such statements. Such factors include, among others: competitive pressures from within the restaurant industry; the level of success of our operating initiatives and advertising and promotional efforts; adverse publicity; changes in business strategy or development plans; terms and availability of capital; regional weather conditions; overall changes in the general economy (including with regard to energy costs), particularly at the retail level; political environment (including acts of war and terrorism); and other factors included in the discussion below, or in Part II. Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations and Part I. Item 1A. Risk Factors, contained in our Annual Report on Form 10-K for the year ended December 26, 2012.

16

Statements of Income

The following table contains information derived from our Condensed Consolidated Statements of Comprehensive Income expressed as a percentage of total operating revenues, except as noted below. Percentages may not add due to rounding.

	Quarter Ended												Three Quarters Ended
	September 25, 2013						September 26, 2012						September 25, 2013						September 26, 2012
	(Dollars in thousands)
Revenue:
Company restaurant sales	$	83,371			71.1	%	$	86,575			71.6	%	$	247,242			71.0	%	$	271,977			73.0	%
Franchise and license revenue	33,904				28.9	%	34,370				28.4	%	101,094				29.0	%	100,437				27.0	%
Total operating revenue	117,275				100.0	%	120,945				100.0	%	348,336				100.0	%	372,414				100.0	%
Costs of company restaurant sales (a):
Product costs	21,722				26.1	%	21,449				24.8	%	64,270				26.0	%	67,684				24.9	%
Payroll and benefits	33,746				40.5	%	34,409				39.7	%	98,512				39.8	%	108,779				40.0	%
Occupancy	5,598				6.7	%	5,780				6.7	%	16,339				6.6	%	17,776				6.5	%
Other operating expenses	12,022				14.4	%	12,170				14.1	%	34,538				14.0	%	37,267				13.7	%
Total costs of company restaurant sales	73,088				87.7	%	73,808				85.3	%	213,659				86.4	%	231,506				85.1	%
Costs of franchise and license revenue (a)	11,599				34.2	%	12,078				35.1	%	34,586				34.2	%	34,776				34.6	%
General and administrative expenses	13,704				11.7	%	14,702				12.2	%	42,948				12.3	%	45,150				12.1	%
Depreciation and amortization	5,198				4.4	%	5,287				4.4	%	15,774				4.5	%	17,174				4.6	%
Operating (gains), losses and other charges, net	161				0.1	%	3,380				2.8	%	1,779				0.5	%	(794		)		(0.2	)%
Total operating costs and expenses	103,750				88.5	%	109,255				90.3	%	308,746				88.6	%	327,812				88.0	%
Operating income	13,525				11.5	%	11,690				9.7	%	39,590				11.4	%	44,602				12.0	%
Interest expense, net	2,452				2.1	%	3,088				2.6	%	7,800				2.2	%	10,537				2.8	%
Other nonoperating expense (income), net	(276		)		(0.2	)%	38				0.0	%	1,056				0.3	%	7,941				2.1	%
Net income before income taxes	11,349				9.7	%	8,564				7.1	%	30,734				8.8	%	26,124				7.0	%
Provision for income taxes	4,318				3.7	%	3,201				2.6	%	10,424				3.0	%	10,295				2.8	%
Net income	$	7,031			6.0	%	$	5,363			4.4	%	$	20,310			5.8	%	$	15,829			4.3	%
Other Data:
Company average unit sales	$	510					$	493					$	1,509					$	1,447
Franchise average unit sales	$	365					$	358					$	1,073					$	1,061
Company equivalent units (b)	163						175						164						188
Franchise equivalent units (b)	1,520						1,511						1,524						1,495
Company same-store sales increase (decrease) (c)(d)	0.7			%			(0.5		)	%			(0.4		)	%			0.1			%
Domestic franchise same-store sales increase (decrease) (c)(e)	1.3			%			0.7			%			0.5			%			1.6			%

(a) Costs of company restaurant sales percentages are as a percentage of company restaurant sales. Costs of franchise and license revenue percentages are as a percentage of franchise and license revenue. All other percentages are as a percentage of total operating revenue.

(b) Equivalent units are calculated as the weighted average number of units outstanding during a defined time period.

(c) Same-store sales include sales from restaurants that were open the same period in the prior year.

(d) Prior year amounts have not been restated for 2013 comparable units.

(e) Prior year amounts have been restated to represent domestic franchise units only.

17

Quarter Ended September 25, 2013 Compared with Quarter Ended September 26, 2012

Unit Activity

	Quarter Ended
	September 25, 2013		September 26, 2012
Company restaurants, beginning of period	165		177
Units opened	—		—
Units acquired from franchisees	1		—
Units sold to franchisees	(2	)	(5	)
Units closed	—		(1	)
End of period	164		171
Franchised and licensed restaurants, beginning of period	1,525		1,507
Units opened	9		12
Units purchased from Company	2		5
Units acquired by Company	(1	)	—
Units closed	(13	)	(8	)
End of period	1,522		1,516
Total restaurants, end of period	1,686		1,687

Company Restaurant Operations

During the quarter ended September 25, 2013, we realized a 0.7%increase in same-store sales. Company restaurant sales decreased$3.2 million, or 3.7%, primarily resulting from a 12 equivalent-unit decrease in company-owned restaurants. The decrease in equivalent units reflects the impact of our refranchising program that was completed at the end of 2012.

Total costs of company restaurant sales as a percentage of company restaurant sales increased to 87.7% from 85.3%. Product costs increased to 26.1% from 24.8% primarily due to the unfavorable impact of product mix as well as increased commodity costs. Payroll and benefits increased to 40.5% from 39.7% primarily due to unfavorable workers' compensation claims development and higher group insurance costs. Occupancy costs remained constant at 6.7%. Other operating expenses were comprised of the following amounts and percentages of company restaurant sales: 

	Quarter Ended
	September 25, 2013				September 26, 2012
	(Dollars in thousands)
Utilities	$	3,592	4.3	%	$	3,760	4.3	%
Repairs and maintenance	1,550		1.9	%	1,578		1.8	%
Marketing	3,116		3.7	%	3,213		3.7	%
Legal	157		0.2	%	197		0.2	%
Other direct costs	3,607		4.3	%	3,422		4.0	%
Other operating expenses	$	12,022	14.4	%	$	12,170	14.1	%

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Franchise Operations

Franchise and license revenue and costs of franchise and license revenue were comprised of the following amounts and percentages of franchise and license revenue for the periods indicated:

	Quarter Ended
	September 25, 2013				September 26, 2012
	(Dollars in thousands)
Royalties	$	21,777	64.2	%	$	21,333	62.1	%
Initial fees	434		1.3	%	728		2.1	%
Occupancy revenue	11,693		34.5	%	12,309		35.8	%
Franchise and license revenue	$	33,904	100.0	%	$	34,370	100.0	%
Occupancy costs	8,616		25.4	%	9,027		26.2	%
Other direct costs	2,983		8.8	%	3,051		8.9	%
Costs of franchise and license revenue	$	11,599	34.2	%	$	12,078	35.1	%

Royalties increased by $0.4 million, or 2.1%, primarily resulting from a nine equivalent unit increase in franchised and licensed units and a 1.3%increase in domestic same-store sales, as compared to the prior year. The increase in equivalent units reflects the impact of our refranchising program that was completed at the end of 2012. Initial fees decreased by $0.3 million, or 40.4%, as fewer restaurants were opened by and sold to franchisees during the current year period. The decrease in occupancy revenue of $0.6 million, or 5.0%, is primarily the result of lease expirations.

Costs of franchise and license revenue decreased by $0.5 million, or 4.0%. The decrease in occupancy costs of $0.4 million, or 4.6%, is primarily the result of lease expirations. Other direct costs decreased by $0.1 million, or 2.2%. As a result, costs of franchise and license revenue as a percentage of franchise and license revenue decreased to 34.2% for the quarter ended September 25, 2013 from 35.1% for the quarter ended September 26, 2012.

Other Operating Costs and Expenses

Other operating costs and expenses such as general and administrative expenses and depreciation and amortization expense relate to both company and franchise operations.

General and administrative expenses were comprised of the following:

	Quarter Ended
	September 25, 2013		September 26, 2012
	(In thousands)
Share-based compensation	$	1,053	$	1,128
Other general and administrative expenses	12,651		13,574
Total general and administrative expenses	$	13,704	$	14,702

The $1.0 milliondecrease in general and administrative expenses is primarily the result of reductions in incentive compensation of $0.6 million and professional fees of $0.3 million.

19

Depreciation and amortization was comprised of the following:

	Quarter Ended
	September 25, 2013		September 26, 2012
	(In thousands)
Depreciation of property and equipment	$	3,595	$	3,702
Amortization of capital lease assets	884		801
Amortization of intangible assets	719		784
Total depreciation and amortization expense	$	5,198	$	5,287

The overall decrease in depreciation and amortization expense is primarily due to the sale of company-owned restaurants to franchisees during fiscal 2012.

Operating (gains), losses and other charges, net were comprised of the following:

	Quarter Ended
	September 25, 2013			September 26, 2012
	(In thousands)
(Gains) losses on sales of assets and other, net	$	(68	)	$	91
Restructuring charges and exit costs	229			821
Impairment charges	—			2,468
Operating (gains), losses and other charges, net	$	161		$	3,380

Impairment charges of $2.5 million for the quarter ended September 26, 2012 resulted primarily from the impairment of six

units identified as held for sale.

Restructuring charges and exit costs were comprised of the following:

	Quarter Ended
	September 25, 2013		September 26, 2012
	(In thousands)
Exit costs	$	198	$	233
Severance and other restructuring charges	31		588
Total restructuring and exit costs	$	229	$	821

Operating income was $13.5 million for the quarter ended September 25, 2013 compared with $11.7 million for the quarter ended September 26, 2012.

20

Interest expense, net was comprised of the following:

	Quarter Ended
	September 25, 2013			September 26, 2012
	(In thousands)
Interest on credit facilities	$	910		$	1,425
Interest on capital lease liabilities	907			890
Letters of credit and other fees	359			383
Other interest (income) expense, net	(20		)	21
Total cash interest	2,156			2,719
Amortization of deferred financing costs	120			136
Interest accretion on other liabilities	176			233
Total interest expense, net	$	2,452		$	3,088

The decrease in interest expense resulted from a decrease in interest rates related to the 2013 refinancing of our credit facility, as well as debt reductions during 2012 and 2013.

Other nonoperating income, net was $0.3 million for the quarter ended September 25, 2013 compared with other nonoperating expense of less than $0.1 million for the quarter ended September 26, 2012.

The provision for income taxes was $4.3 million for the quarter ended September 25, 2013 compared to $3.2 million for the quarter ended September 26, 2012. A valuation allowance of $0.5 million was recorded against certain state jobs tax credits during the third quarter of 2013 related to changes in California law enacted during the period. The provision for income taxes for the third quarters of 2013 and 2012 was determined using our effective rate estimated for the entire fiscal year.

Net income was $7.0 million for the quarter ended September 25, 2013 compared with $5.4 million for the quarter ended September 26, 2012.

Three Quarters Ended September 25, 2013 Compared with Three Quarters Ended September 26, 2012

Unit Activity

	Three Quarters Ended
	September 25, 2013		September 26, 2012
Company restaurants, beginning of period	164		206
Units opened	—		—
Units acquired from franchisees	2		—
Units sold to franchisees	(2	)	(28	)
Units closed	—		(7	)
End of period	164		171
Franchised and licensed restaurants, beginning of period	1,524		1,479
Units opened	27		27
Units purchased from Company	2		28
Units acquired by Company	(2	)	—
Units closed	(29	)	(18	)
End of period	1,522		1,516
Total restaurants, end of period	1,686		1,687

21

Company Restaurant Operations

During the three quarters ended September 25, 2013, we realized a 0.4%decrease in same-store sales. Company restaurant sales decreased$24.7 million, or 9.1%, primarily resulting from a 24 equivalent-unit decrease in company restaurants. The decrease in equivalent-units reflects the impact of our refranchising program that was completed at the end of 2012.

Total costs of company restaurant sales as a percentage of company restaurant sales increased to 86.4% from 85.1%. Product costs increased to 26.0% from 24.9% primarily due to the unfavorable impact of product mix as well as increased commodity costs. Payroll and benefits decreased to 39.8% from 40.0% as decreased labor costs were partially offset by increased workers' compensation costs. Occupancy costs increased to 6.6% from 6.5%. Other operating expenses were comprised of the following amounts and percentages of company restaurant sales:

	Three Quarters Ended
	September 25, 2013				September 26, 2012
	(Dollars in thousands)
Utilities	$	9,897	4.0	%	$	11,066	4.1	%
Repairs and maintenance	4,423		1.8	%	4,901		1.8	%
Marketing	9,245		3.7	%	10,138		3.7	%
Legal	671		0.3	%	366		0.1	%
Other direct costs	10,302		4.2	%	10,796		4.0	%
Other operating expenses	$	34,538	14.0	%	$	37,267	13.7	%

Franchise Operations

Franchise and license revenue and costs of franchise and license revenue were comprised of the following amounts and percentages of franchise and license revenue for the periods indicated:

	Three Quarters Ended
	September 25, 2013				September 26, 2012
	(Dollars in thousands)
Royalties	$	64,205	63.5	%	$	62,734	62.5	%
Initial fees	1,164		1.2	%	2,167		2.2	%
Occupancy revenue	35,725		35.3	%	35,536		35.3	%
Franchise and license revenue	$	101,094	100.0	%	$	100,437	100.0	%
Occupancy costs	26,235		25.9	%	26,455		26.3	%
Other direct costs	8,351		8.3	%	8,321		8.3	%
Costs of franchise and license revenue	$	34,586	34.2	%	$	34,776	34.6	%

Royalties increased by $1.5 million, or 2.3%, primarily resulting from a 29 equivalent unit increase in franchised and licensed units and a 0.5%increase in domestic same-store sales, as compared to the prior year. The increase in equivalent units reflects the impact of our refranchising program that was completed at the end of 2012. Initial fees decreased by $1.0 million, or 46.3%, as fewer restaurants were sold to franchisees during the current year period. The increase in occupancy revenue of $0.2 million, or 0.5%, is primarily the result of the sale of restaurants to franchisees during 2012, partially offset by lease expirations.

Costs of franchise and license revenue decreased by $0.2 million, or 0.5%. The decrease in occupancy costs of $0.2 million, or 0.8%, is primarily the result of lease expirations. Other direct costs increased by less than $0.1 million, or 0.4%. As a result, costs of franchise and license revenue as a percentage of franchise and license revenue decreased to 34.2% for the three quarters ended September 25, 2013 from 34.6% for the three quarters ended September 26, 2012.

22

Other Operating Costs and Expenses

Other operating costs and expenses such as general and administrative expenses and depreciation and amortization expense relate to both company and franchise operations.

General and administrative expenses were comprised of the following:

	Three Quarters Ended
	September 25, 2013		September 26, 2012
	(In thousands)
Share-based compensation	$	3,434	$	2,794
Other general and administrative expenses	39,514		42,356
Total general and administrative expenses	$	42,948	$	45,150

The $2.2 milliondecrease in general and administrative expenses is primarily the result of reductions in incentive compensation of $1.0 million, professional fees of $0.8 million and other general and administrative expense of $1.0 million. These reductions were partially offset by an increase in share-based compensation of $0.6 million.

Depreciation and amortization was comprised of the following:

	Three Quarters Ended
	September 25, 2013		September 26, 2012
	(In thousands)
Depreciation of property and equipment	$	10,985	$	12,333
Amortization of capital lease assets	2,555		2,446
Amortization of intangible assets	2,234		2,395
Total depreciation and amortization expense	$	15,774	$	17,174

The overall decrease in depreciation and amortization expense is primarily due to the sale of company restaurants to franchisees during fiscal 2012.

Operating (gains), losses and other charges, net were comprised of the following:

	Three Quarters Ended
	September 25, 2013			September 26, 2012
	(In thousands)
Gains on sales of assets and other, net	$	(83	)	$	(6,772	)
Restructuring charges and exit costs	1,005			2,970
Impairment charges	857			3,008
Operating (gains), losses and other charges, net	$	1,779		$	(794	)

During the three quarters ended September 26, 2012, we recognized gains of $6.8 million, primarily resulting from the sale of restaurant operations to franchisees and the sale of real estate.

Impairment charges of $0.9 million for the three quarters ended September 25, 2013 resulted primarily from the impairment of two units identified as assets held for sale. Impairment charges of $3.0 million for the three quarters ended September 26, 2012 resulted primarily from the impairment of seven units identified as assets held for sale and the impairment of an underperforming unit.

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Restructuring charges and exit costs were comprised of the following:

	Three Quarters Ended
	September 25, 2013		September 26, 2012
	(In thousands)
Exit costs	$	435	$	1,139
Severance and other restructuring charges	570		1,831
Total restructuring and exit costs	$	1,005	$	2,970

Operating income was $39.6 million for the three quarters ended September 25, 2013 and $44.6 million for the three quarters ended September 26, 2012.

Interest expense, net was comprised of the following:

	Three Quarters Ended
	September 25, 2013			September 26, 2012
	(In thousands)
Interest on credit facilities	$	3,197		$	5,761
Interest on capital lease liabilities	2,716			2,677
Letters of credit and other fees	1,038			1,234
Other interest income	(61		)	(624		)
Total cash interest	6,890			9,048
Amortization of deferred financing costs	376			639
Amortization of debt discount	—			137
Interest accretion on other liabilities	534			713
Total interest expense, net	$	7,800		$	10,537

The decrease in interest expense resulted from a decrease in interest rates related to the 2013 refinancing of our credit facility, as well as debt reductions during 2012 and 2013.

Other nonoperating expense, net was $1.1 million for the three quarters ended September 25, 2013 compared with $7.9 million for the three quarters ended September 26, 2012. The amount for the 2013 period was primarily the result of $1.2 million of expenses and write-offs of deferred financing costs incurred related to our 2013 debt refinancing. The amount for the 2012 period was primarily the result of $7.9 million of expenses and write-offs of deferred financing costs and original issue discount incurred related to our 2012 debt refinancing.

The provision for income taxes was $10.4 million for the three quarters ended September 25, 2013 compared to $10.3 million the three quarters ended September 26, 2012. For the 2013 period, the difference in the overall effective rate from the U.S. Statutory rate was due to state and foreign taxes, employment tax credits, and discrete tax items. The passage of the American Tax Payer Relief Act of 2012 resulted in deferred tax benefits of $0.3 million related to work opportunity credits generated in 2012, which were allowed retroactively. In addition, state job tax credits of $0.8 million were claimed during the 2013 period resulting from the prior year's hiring activity. A valuation allowance of $0.5 million was recorded against certain state jobs tax credits during the 2013 period related to changes in California law enacted during the period. The provision for income taxes for the 2012 period was determined using our effective rate estimated for the entire fiscal year.

Net income was $20.3 million for the three quarters ended September 25, 2013 compared with $15.8 million for the three quarters ended September 26, 2012.

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Liquidity and Capital Resources

Our primary sources of liquidity and capital resources are cash generated from operations and borrowings under our credit facility (as described below). Principal uses of cash are operating expenses, capital expenditures, debt repayments and the repurchase of shares of our Common Stock.

The following table presents a summary of our sources and uses of cash and cash equivalents for the periods indicated:

	Three Quarters Ended
	September 25, 2013			September 26, 2012
	(In thousands)
Net cash provided by operating activities	$	44,716		$	44,023
Net cash (used in) provided by investing activities	(9,429		)	6,312
Net cash used in financing activities	(42,522		)	(39,927		)
Increase (decrease) in cash and cash equivalents	$	(7,235	)	$	10,408

We believe that our estimated cash flows from operations for 2013, combined with our capacity for additional borrowings under our credit facility, will enable us to meet our anticipated cash requirements and fund capital expenditures over the next twelve months.

Net cash flows used in investing activities were $9.4 million for the three quarters ended September 25, 2013. These cash flows include capital expenditures of $11.8 million, acquisition of restaurant units of $1.6 million and issuances of notes receivable of $1.2 million, partially offset by $3.7 million in collections of notes receivable and $1.6 million in proceeds from asset sales. Our principal capital requirements have been largely associated with the following:

	Three Quarters Ended
	September 25, 2013		September 26, 2012
	(In thousands)
Facilities	$	3,433	$	3,840
New construction	449		2,850
Remodeling	4,298		89
Information technology	409		195
Other	3,230		872
Capital expenditures	$	11,819	$	7,846

Capital expenditures for fiscal 2013 are expected to be approximately $20-$22 million (including acquisitions), comprised primarily of costs related to remodels and facilities.

Cash flows used in financing activities were $42.5 million for the three quarters ended September 25, 2013, which included a net reduction in long-term debt of $17.8 million, stock repurchases of $22.0 million, and debt refinancing costs of $1.7 million.

Our working capital deficit was $23.9 million at September 25, 2013 compared with $27.2 million at December 26, 2012. The decrease in working capital deficit is primarily related to the timing of payments impacting prepaid and payable balances. We are able to operate with a substantial working capital deficit because (1) restaurant operations and most food service operations are conducted primarily on a cash (and cash equivalent) basis with a low level of accounts receivable, (2) rapid turnover allows a limited investment in inventories, and (3) accounts payable for food, beverages and supplies usually become due after the receipt of cash from the related sales.

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Refinancing of Credit Facility

On April 24, 2013, Denny's Corporation and certain of its subsidiaries refinanced our credit facility (the "Old Credit Facility") and entered into a new senior secured credit agreement in an aggregate principal amount of $250 million (the “New Credit Facility”). The New Credit Facility is comprised of a $60 million senior secured term loan and a $190 million senior secured revolver (with a $30 million letter of credit sublimit). A commitment fee of 0.35% is paid on the unused portion of the revolving credit facility. Borrowings under the New Credit Facility bear a tiered interest rate based on the Company's consolidated leverage ratio and is initially set at LIBOR plus 200 basis points. The New Credit Facility includes an accordion feature that would allow us to increase the size of the facility to $300 million. The maturity date for the New Credit Facility is April 24, 2018.

The New Credit Facility was used to refinance the Old Credit Facility and will also be available for working capital, capital expenditures and other general corporate purposes. The New Credit Facility is guaranteed by the Company and its material subsidiaries and is secured by substantially all of the assets of the Company and its subsidiaries, including the stock of the Company's subsidiaries. It includes negative covenants that are usual for facilities and transactions of this type. The New Credit Facility also includes certain financial covenants with respect to a maximum consolidated leverage ratio, a minimum consolidated fixed charge coverage ratio and maximum capital expenditures.

The term loan under the New Credit Facility requires amortization of 5% per year in the first two years, 7.5% in the subsequent two years and 10% in the fifth year with the balance due at maturity. We will be required to make certain mandatory prepayments under certain circumstances and will have the option to make certain prepayments under the New Credit Facility. The New Credit Facility includes events of default (and related remedies, including acceleration and increased interest rates following an event of default) that are usual for facilities and transactions of this type.

As a result of the debt refinancing, we recorded $1.2 million of losses on early extinguishment of debt, consisting primarily of $0.4 million of transaction costs and $0.8 million from the write-off of deferred financing costs related to the Old Credit Facility. These losses are included as a component of other nonoperating expense in the condensed Consolidated Statements of Comprehensive Income.

As of September 25, 2013, we had outstanding term loan borrowings under the New Credit Facility of $58.5 million and outstanding letters of credit under the senior secured revolver of $26.0 million. There were $97.0 million in revolving loans outstanding at September 25, 2013. These balances resulted in availability of $67.0 million under the revolving facility. The weighted-average interest rates under the term loan and on outstanding revolver loans as of September 25, 2013 were 2.18%.

Our future contractual obligations relating to long-term debt and related interest obligations as of September 25, 2013 are as follows:

	Payments Due by Period
	Total		Less than 1 Year		1-2 Years		3-4 Years		5 Years and Thereafter
	(In thousands)
Long-term debt	$	155,500	$	3,000	$	8,250	$	144,250	$	—
Interest obligations (1)	14,736		3,367		6,507		4,862		—

(1) Interest obligation represent payments related to our long-term debt outstanding at September 25, 2013. For long-term debt with variable rates, we have used the rate applicable at September 25, 2013 to project interest over the periods presented in the table above.

See Management's Discussion and Analysis of Financial Condition and Results of Operations contained in our Annual Report on Form 10-K for the year ended December 26, 2012 for information concerning other future contractual obligations and commitments.

Interest Rate Hedges

On April 13, 2012, we entered into interest rate hedges that cap the LIBOR rate on borrowings under our credit facility for a two year period. The 200 basis point LIBOR cap applied to $150 million of borrowings from April 13, 2012 through April 13, 2013 and $125 million of borrowings from April 14, 2013 through April 13, 2014.

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Our existing interest rate hedges remain in effect under the New Credit Facility until April 13, 2014. On April 30, 2013, we entered into additional interest rate hedges that cap the LIBOR rate on borrowings under the New Credit Facility. The 200 basis point LIBOR cap applies to $150 million of borrowings from April 14, 2014 through March 31, 2015.

On April 30, 2013, we also entered into interest rate swaps to hedge a portion of the cash flows of our floating rate debt from March 31, 2015 through March 29, 2018. We designated the interest rate swaps as cash flow hedges of our exposure to variability in future cash flows attributable to payments of LIBOR due on a related $150 million notional debt obligation from March 31, 2015 through March 31, 2017 and a related $140 million notional debt obligation from April 1, 2017 through March 29, 2018. Under the terms of the swaps, we will pay an average fixed rate of 3.12% on the notional amounts and receive payments from a counterparty based on the 30-day LIBOR rate.

Implementation of New Accounting Standards

See Note 2 to our Condensed Consolidated Financial Statements.

Item 3.     Quantitative and Qualitative Disclosures About Market Risk

Interest Rate Risk

We have exposure to interest rate risk related to certain instruments entered into for other than trading purposes. Specifically, as of September 25, 2013, borrowings under our term loan and revolver bore interest at variable rates based on LIBOR plus a spread of 200 basis points per annum. Through April 13, 2013, up to $150 million of the term loan borrowings had a 200 basis point LIBOR point cap. As of April 13, 2013, up to $125 million of the term loan borrowing has a 200 basis point LIBOR point cap.

Based on the levels of borrowings under the credit facility at September 25, 2013, if interest rates changed by 100 basis points, our annual cash flow and income before taxes would change by approximately $1.6 million. This computation is determined by considering the impact of hypothetical interest rates on the credit facility at September 25, 2013, taking into consideration the interest rate cap. However, the nature and amount of our borrowings may vary as a result of future business requirements, market conditions and other factors.

We also have exposure to interest rate risk related to our pension plan, other defined benefit plans and self-insurance liabilities. A 25 basis point increase or decrease in discount rate would increase or decrease our projected benefit obligation related to our pension plan by approximately $2.6 million and would impact the pension plan's net periodic benefit cost by approximately $0.3 million. The impact of a 25 basis point increase or decrease in discount rate would decrease or increase our projected benefit obligation related to our other defined benefit plans by less than $0.1 million while the plans' net periodic benefit cost would remain flat. A 25 basis point increase or decrease in discount rate related to our self-insurance liabilities would result in a decrease or increase of $0.2 million, respectively.

Commodity Price Risk

We purchase certain food products, such as beef, poultry, pork, eggs and coffee, and utilities such as gas and electricity, which are affected by commodity pricing and are, therefore, subject to price volatility caused by weather, production problems, delivery difficulties and other factors that are outside our control and which are generally unpredictable. Changes in commodity prices affect us and our competitors generally and often simultaneously. In general, we purchase food products and utilities based upon market prices established with vendors. Although many of the items purchased are subject to changes in commodity prices, the majority of our purchasing arrangements are structured to contain features that minimize price volatility by establishing fixed pricing and/or price ceilings and floors. We use these types of purchase arrangements to control costs as an alternative to using financial instruments to hedge commodity prices. In many cases, we believe we will be able to address commodity cost increases which are significant and appear to be long-term in nature by adjusting our menu pricing or changing our product delivery strategy. However, competitive circumstances could limit such actions and, in those circumstances, increases in commodity prices could lower our margins. Because of the often short-term nature of commodity pricing aberrations and our ability to change menu pricing or product delivery strategies in response to commodity price increases, we believe that the impact of commodity price risk is not significant.

We have established a policy to identify, control and manage market risks which may arise from changes in interest rates, commodity prices and other relevant rates and prices. We do not use derivative instruments for trading purposes. 

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Item 4.     Controls and Procedures

As required by Rule 13a-15(b) under the Securities Exchange Act of 1934, as amended, (the “Exchange Act”) our management conducted an evaluation (under the supervision and with the participation of our President and Chief Executive Officer, John C. Miller, and our Executive Vice President, Chief Administrative Officer and Chief Financial Officer, F. Mark Wolfinger) as of the end of the period covered by this Quarterly report on Form 10-Q, of the effectiveness of our disclosure controls and procedures as defined in Rule 13a-15(e) under the Exchange Act. Based on that evaluation, Messrs. Miller and Wolfinger each concluded that our disclosure controls and procedures are effective to provide reasonable assurance that information required to be disclosed in the reports that we file or submit under the Exchange Act (i) is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission's rules and forms and (ii) is accumulated and communicated to our management, including Messrs. Miller and Wolfinger, as appropriate to allow timely decisions regarding required disclosure. 

There have been no changes in our internal control over financial reporting identified in connection with the evaluation required by Rule 13a-15(d) of the Exchange Act that occurred during our last fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II - OTHER INFORMATION

Item 1.     Legal Proceedings

There are various claims and pending legal actions against or indirectly involving us, incidental to and arising out of the ordinary course of the business. In the opinion of management, based upon information currently available, the ultimate liability with respect to these proceedings and claims will not materially affect the Company's consolidated results of operations or financial position.

Item 2.     Unregistered Sales of Equity Securities and Use of Proceeds

Purchases of Equity Securities by the Issuer

The table below provides information concerning repurchases of shares of our Common Stock during the quarter ended September 25, 2013. 

Period	Total Number of Shares Purchased	Average Price Paid Per Share (1)		Total Number of Shares Purchased as Part of Publicly Announced Programs (2)(3)	Maximum Number of Shares that May Yet be Purchased Under the Programs (2)(3)
	(In thousands, except per share amounts)
June 27, 2013 - July 24, 2013	489	$	5.78	489	10,969
July 25, 2013 - August 21, 2013	698	5.67		698	10,271
August 22, 2013 - September 25, 2013	594	5.76		594	9,677
Total	1,781	$	5.73	1,781

(1) Average price paid per share excludes commissions.

(2) On May 18, 2012, we announced that our Board of Directors approved the repurchase of up to 6 million shares of Common Stock. Such repurchases may take place from time to time on the open market (including in pre-arranged stock trading plans in accordance with the guidelines specified in Rule 10b5-1 under the Securities Exchange Act of 1934) or in privately negotiated transactions, subject to market and business conditions. During the quarter ended September 25, 2013, we purchased 1,458,185 shares of Common Stock for an aggregate consideration of approximately $8.3 million, pursuant to the share repurchase program, thus completing this repurchase program.

(3) On April 25, 2013, we announced that our Board of Directors approved a new share repurchase program, authorizing us to repurchase up to an additional 10 million shares of our Common Stock. Such repurchases are to be made in a manner similar to, and will be in addition to, authorizations under the May 18, 2012 repurchase program. During the quarter ended September 25, 2013, we purchased 322,855 shares of Common Stock for an aggregate consideration of approximately $1.9 million, pursuant to the share repurchase program.

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Item 6.     Exhibits

The following are included as exhibits to this report: 

Exhibit No.	Description
10.1	Denny's Corporation Amended and Restated Executive and Key Employee Severance Pay Plan
31.1	Certification of John C. Miller, President and Chief Executive Officer of Denny’s Corporation, pursuant to Rule 13a-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2	Certification of F. Mark Wolfinger, Executive Vice President, Chief Administrative Officer and Chief Financial Officer of Denny’s Corporation, pursuant to Rule 13a-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1	Certification of John C. Miller, President and Chief Executive Officer of Denny’s Corporation and F. Mark Wolfinger, Executive Vice President, Chief Administrative Officer and Chief Financial Officer of Denny’s Corporation, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS*	XBRL Instance Document
101.SCH*	XBRL Taxonomy Extension Schema Document
101.CAL*	XBRL Taxonomy Extension Calculation Linkbase Document
101.LAB*	XBRL Taxonomy Extension Label Linkbase Document
101.PRE*	XBRL Taxonomy Extension Presentation Linkbase Document
101.DEF*	XBRL Taxonomy Extension Definition Linkbase Document

* In accordance with Regulation S-T, the XBRL-related information in Exhibit 101 to this Quarterly Report on Form 10-Q shall be deemed "furnished" and not "filed."

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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 thereunto duly authorized.

		DENNY'S CORPORATION
Date:	October 28, 2013	By:	/s/ F. Mark Wolfinger
			F. Mark Wolfinger
			Executive Vice President, Chief Administrative Officer and Chief Financial Officer
Date:	October 28, 2013	By:	/s/ Jay C. Gilmore
			Jay C. Gilmore
			Vice President, Chief Accounting Officer and Corporate Controller

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EX-10.1

Exhibit 10.1

DENNY'S CORPORATION

AMENDED AND RESTATED

EXECUTIVE AND KEY EMPLOYEE SEVERANCE PAY PLAN

DENNY’S CORPORATION

AMENDED AND RESTATED

EXECUTIVE AND KEY EMPLOYEE SEVERANCE PAY PLAN

ARTICLE 1

PURPOSE AND TERM

1.1Purpose. Denny’s Corporation (the “Company”) established this Denny’s Corporation Amended and Restated Executive and Key Employee Severance Pay Plan (the “Plan”) in order to provide transitional income to certain executive officers and key employees who are involuntarily terminated under certain conditions. The Plan supersedes all prior written or unwritten severance pay plans, notice pay plans, practices or programs offered to or established for participants by the Company except for individual employment contracts, change in control agreements or other similar arrangements providing severance pay or similar benefits. The Plan is intended to be a “welfare plan,” but not a “pension plan,” as defined in ERISA Sections 3(1) and 3(2), respectively, and the Company intends that the Plan comply with all applicable provisions of ERISA.

1.2Term. The Plan shall generally be effective as of the Effective Date, subject to amendment from time to time in accordance with Section 7.2. The Plan shall continue until terminated pursuant to Article 7 of the Plan.

ARTICLE 2

DEFINITIONS

As used herein, the following words and phrases shall have the following meanings:

2.1“Affiliate” means Denny’s, Inc. and any other corporation or entity (including, but not limited to, a partnership or a limited liability company) that is affiliated with the Company through stock or equity ownership or otherwise, and is designated as an Affiliate for purposes of this Plan by the Committee.

2.2“Base Salary” means the amount a Participant is entitled to receive as wages or salary on an annualized basis as in effect from time to time, without reduction for any pre-tax contributions to benefit plans. Base Salary does not include bonuses, commissions, overtime pay or income from stock options, stock grants or other incentive compensation.

2.3“Board” means the Board of Directors of the Company.

2.4“Cause” as a reason for a Participant’s termination of employment shall mean any of the following acts by the Participant, as determined by the Board: gross neglect of duty; prolonged absence from duty without the consent of the Company; intentionally engaging in any activity that is in conflict with or adverse to the business or other interests of the Company; willful misconduct, misfeasance or malfeasance of duty which is reasonably determined to be

detrimental to the Company; conviction of, or plea of guilty or nolo contendere, to any crime involving the personal enrichment of the Participant at the expense of the Company or shareholders of the Company; conviction of a felony or the conviction of any crime involving dishonesty or moral turpitude.

2.5“Change in Control” means the occurrence of any of the following events:

(a)any person becomes a “beneficial owner” (as defined in Rule 13d-3 under the 1934 Act), directly or indirectly, of securities of the Company (not including in the securities beneficially owned by such Person any securities acquired directly from the Company or its Affiliates, other than in connection with the acquisition by the Company or its Affiliates of a business) representing 30% or more of either the then outstanding Shares of Stock or the combined voting power of the Company’s then outstanding securities; or

(b)The following individuals cease for any reason to constitute at least two-thirds (2/3) of the number of directors then serving on the Board: individuals who, on the Effective Date hereof, constitute the Board and any new director (other than a director whose initial assumption of office is in connection with an actual or threatened election contest, including but not limited to a consent solicitation, relating to the election of directors of the Company (as such terms are used in Rule 14A-11 of the 1934 Act) whose appointment or election by the Board or nomination of election by the Company’s stockholders was approved by a vote of at least two-thirds (2/3) of the Company’s directors then still in office who either were directors on the Effective Date of the Plan, or whose appointment, election, or nomination for election was previously approved); or

(c)the consummation of a merger or consolidation with any other entity, other than (i) a merger or consolidation which would result in (A) the voting securities of the Company then outstanding immediately prior to such merger or consolidation continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity or any parent thereof), in combination with the ownership of any trustee or other fiduciary holding securities under an employee benefit plan of the Company, greater than 65% of the combined voting power of the voting securities of the Company or such surviving entity or any parent thereof outstanding immediately after such merger or consolidation, and (B) individuals described in Section 2.1(f)(ii) above constitute more than one-half of the members of the board of directors of the surviving entity or ultimate parent thereof; or (ii) a merger or consolidation effected to implement a recapitalization of the Company (or similar transaction) in which no Person is or becomes the beneficial owner, directly or indirectly, of securities of the Company (not including in the securities beneficially owned by such Person any securities acquired directly from the Company or its Affiliates, other than in connection with the acquisition by the Company or its Affiliates of a business) representing 30% or more of either the then outstanding shares of the Company or the combined voting power of the Company’s then outstanding securities; or (iii) a merger or consolidation following which the record holders of the voting securities of the Company immediately prior to such transaction or series of

integrated transactions continue to have substantially the same proportionate ownership in an entity which owns all or substantially all of the assets of the Company immediately following such transaction or series of integrated transactions; or

(d)the consummation of (i) a plan of complete liquidation or dissolution of the Company; or (ii) an agreement for the sale or disposition by the Company of all or substantially all of the Company’s assets, other than a sale or disposition by the Company of all or substantially all of the Company’s assets to an entity, greater than 65% of the combined voting power of the voting securities of which are owned by Persons in substantially the same proportions as their ownership of the Company immediately prior to such sale or disposition; or

Notwithstanding the foregoing, a Change in Control shall not be deemed to have occurred unless the circumstances giving rise to such Change in Control qualify as a “change in control event” under Code Section 409A and applicable regulations.

Furthermore, notwithstanding the foregoing, a Change in Control will not be deemed to have occurred by reason of a distribution of the voting securities of any of the Company's Subsidiaries to the stockholders of the Company, or by means of an initial public offering of such securities.

2.6“Change in Control Severance Benefits” means the benefits payable in accordance with Sections 4.2 and 4.4 of the Plan.

2.7“Code” means the Internal Revenue Code of 1986, as amended from time to time, and includes a reference to the underlying proposed or final regulations.

2.8“Committee” means the Compensation and Incentives Committee of the Board.

2.9“Company” means Denny’s Corporation, or its successor as provided in Section 8.7.

2.10“Disability” shall mean any physical or mental condition which would qualify a Participant for a disability benefit under the long-term disability plan maintained by the Company and applicable to that particular Participant, or if no such disability plan exists, “Disability” means Permanent and Total Disability as defined in Section 22(e)(3) of the Code.

2.11“Effective Date” means January 29, 2008. The Plan was amended and restated effective as of January 25, 2011, and again amended and restated effective as of September 18, 2013.

2.12“Employee” means any regular, full-time or part-time employee of the Company or any Affiliate. Where the context requires in connection with a Participant who is employed directly by an Affiliate, the term “Company” as used herein includes such Affiliate.

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2.13“ERISA” means the Employee Retirement Income Security Act of 1974, as amended.

2.14“Good Reason” means, as a reason for a Participant’s resignation from employment, the occurrence of any of the following without the consent of the Participant:

(a) the assignment to the Participant of duties materially inconsistent with, or a material diminution in, the Participant’s authority, duties or responsibilities,

(b) a material reduction by the Company or an Affiliate in the Participant’s Base Salary or Target Annual Bonus (other than an overall reduction in salaries or target annual bonuses of 10% or less that affects substantially all of the Company’s full-time employees),

(c) a material change in the geographic location at which the Participant is required to perform (it being agreed that a required relocation of more than 50 miles shall be material), or

(d) the continuing material breach by the Company or an Affiliate of any employment agreement between the Participant and the Company or an Affiliate after the expiration of any applicable period for cure.

(e) any failure by the Company to comply with and satisfy Section 9.7 of this Agreement.

A termination by the Participant shall not constitute termination for Good Reason unless the Participant shall first have delivered to the Company, not later than 90 days after the initial occurrence of an event deemed to give rise to a right to terminate for Good Reason, written notice setting forth with specificity the occurrence of such event, and there shall have passed a reasonable time (not less than 30 days) within which the Company may take action to correct, rescind or otherwise substantially reverse the occurrence supporting termination for Good Reason as identified by the Participant.

2.15“Participant” means any Employee designated by the Committee as a participant in the Plan.

2.16“Plan” means this Denny’s Corporation Executive and Key Employee Severance Pay Plan.

2.17“Regular Severance Benefits” means the benefits payable in accordance with Sections 4.2 and 4.4 of the Plan.

2.18“Target Annual Bonus” means, with respect to any Participant, the Participant’s target bonus opportunity under the annual corporate incentive plan applicable to the Participant.

4

2.19“Termination Date” means the date of the termination of a Participant’s employment with the Company as determined in accordance with Article 6.

2.20“Tier I Participant” means any Employee designated by the Committee as a Tier I Participant in the Plan and identified as such in the records of the Plan maintained by the Company at any time during the term of the Plan.

2.21Tier II Participant” means any Employee designated by the Committee as a Tier II Participant in the Plan and identified as such in the records of the Plan maintained by the Company at any time during the term of the Plan.

ARTICLE 3

ELIGIBILITY

3.1Participation. The Committee or the Board shall designate from time to time those Employees or classes of Employees who are Participants in the Plan. In the event the Committee or the Board designates certain Participants by job title, position, function or responsibilities, an Employee who is appointed to such a position after the Effective Date of this Plan shall be a Participant upon the date he or she begins his or her duties in such position, unless otherwise determined by the Committee or the Board. Effective as of September 18, 2013, the Company’s Chief Executive Officer and all of its Executive Vice Presidents are designated as Tier I Participants, and all of the Company’s Senior Vice Presidents and Vice Presidents are designated as Tier II Participants. The list of Participants may be amended by the Committee or the Board at any time prior to a Change in Control to add or remove individual Participants or classes of Participants; provided, however, that the removal of individual Participants or classes of Participants from the Plan shall not be effective for at least 12 months after notification to the Participants of such Committee or Board action. If a Change in Control occurs during such 12-month period, any such action to remove individual Participants or classes of Participants shall be null and void.

3.2Duration of Participation. Subject to Article 4 and Article 7, an Employee shall cease to be a Participant in the Plan if (i) his or her employment is terminated under circumstances in which he or she is not entitled to Severance Benefits under the terms of this Plan, or (ii) prior to a Change in Control, he or she is removed as a Participant or ceases to be among the class of employees designated by the Committee or the Board as Participants. Notwithstanding the foregoing, a Participant who has terminated employment and is entitled to Severance Benefits under Article 4 shall remain a Participant in the Plan until the full amount of the Regular Severance Benefits or Change in Control Severance Benefits, as applicable, and any other amounts payable under the Plan have been paid to the Participant.

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ARTICLE 4

SEVERANCE BENEFITS

4.1Right to Change in Control Severance Benefits.

(a)A Participant shall be entitled to receive from the Company Change in Control Severance Benefits in the amount provided in Section 4.3 if, within the two-year period following a Change in Control, (i) the Participant’s employment with the Company or any Affiliate is terminated by the Company without Cause (other than by reason of the Participant’s death or Disability) or (ii) the Participant’s employment is terminated by the Participant for Good Reason within a period of 180 days after the occurrence of the event giving rise to Good Reason.

(b)If a Change in Control occurs and (i) a Participant’s employment with the Company or any Affiliate was terminated by the Company without Cause (other than by reason of the Participant’s death or Disability) prior to the date of the Change in Control or (ii) an action was taken with respect to the Participant prior to the date of the Change in Control that would have constituted Good Reason if taken after a Change in Control, and the Participant can reasonably demonstrate that such termination or action, as applicable, occurred at the request of a third party who had taken steps reasonably calculated to effect the Change in Control, then the termination or action, as applicable, will be treated for all purposes of this Plan as having occurred immediately following the Change in Control and such former Participant shall be entitled to the benefits of the Plan accordingly.

(c)Notwithstanding anything to the contrary, no Change in Control Severance Benefits shall be provided to a Participant unless the Participant has executed and not revoked a Separation Agreement and General Release in substantially the form attached hereto as Exhibit A (the “Release”) within the time period set forth in the Release.

4.2Right to Regular Severance Benefits.

(a)A Participant shall be entitled to receive from the Company Regular Severance Benefits in the amount provided in Section 4.4 if (i) the Participant’s employment with the Company or any Affiliate is terminated (a) by the Company without Cause (other than by reason of the Participant’s death or Disability) or (b) by the Participant for Good Reason within a period of 180 days after the occurrence of the event giving rise to Good Reason, and (ii) the Participant’s termination of employment does not occur within the two-year period following a Change in Control and the Participant is not otherwise entitled to receive Change in Control Severance Benefits pursuant to Section 4.1.

(b)Notwithstanding anything to the contrary, no Regular Severance Benefits shall be provided to a Participant unless the Participant has executed and not revoked a Separation Agreement and General Release in substantially the form attached hereto

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as Exhibit A (the “Release”) within the time period set forth in the Release. Any installment payments under Section 4.4(a)(i) that would otherwise be payable prior to the effectiveness of the Release shall be accumulated and paid with the next installment payment that is otherwise due following the effectiveness of the Release. In addition, with respect to any Participant who serves on the Company’s Board of Directors, no Regular Severance Benefits shall be provided to such Participant unless and until the Participant resigns as a member of the Board of Directors.

4.3Amount of Change in Control Severance Benefits. If a Participant’s employment is terminated in circumstances entitling him or her to Change in Control Severance Benefits as provided in Section 4.1, then:

(a) the Company shall pay to the Participant in a single lump sum cash payment on the 60th day after the Termination Date (or such later date as may be required by Section 8.2), the aggregate of the following amounts (for purposes of Section 409A of the Code, each installment shall be deemed to be a separate payment):

(i)a pro rata bonus equal to the product of (A) the higher of Participant’s Target Annual Bonus for the year in which the Change in Control occurs or Participant’s Target Annual Bonus for the year in which the Termination Date occurs, and (B) a fraction, the numerator of which is the number of days in the current fiscal year through the Termination Date, and the denominator of which is 365;

(ii)a severance payment equal to two times, in the case of Tier I Participants, or one times, in the case of Tier II Participants, the sum of (x) the Participant’s Base Salary (at the highest rate in effect for any period within three years prior to the Termination Date) and (y) the higher of Participant’s Target Annual Bonus for the year in which the Change in Control occurs or Participant’s Target Annual Bonus for the year in which the Termination Date occurs; and

(iii)with respect to Tier I Participants only, a payment equal to the full cost to provide certain group health benefits sponsored by the Company and maintained by the Tier I Participant on the Termination Date. The amount payable under this Section 4.3(a)(iii) shall be calculated based on the monthly cost (including any portion of the cost paid by the employee) to provide the same level of coverage of such group health benefits maintained by the Tier I Participant as of the Termination Date for 24 months. For purposes of this Section 4.3(a)(iii): (i) group health benefits means any of the following: group medical, dental, vision, and/or prescription drug benefits, and (ii) if the group health benefits are provided pursuant to an insurance contract issued by an insurance carrier to the Company, the cost of such benefits shall be determined based on the monthly premium charged to the Company for such coverage on the Termination Date or, if the group health benefits are self-insured by the Company, the cost of such benefits will be the “applicable premium” determined in accordance with Code

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Section 4980B(f)(4) and the regulations issued thereunder for such for the year in which the Termination Date occurs. The Tier I Participant will be entitled to make an election to continue group health benefits in accordance with the terms of the various group health plans.

(b) with respect to Tier II Participants only, if the Tier II Participant elects to continue participation in any group medical, dental, vision and/or prescription drug plan benefits to which the Tier II Participant and/or the Tier II Participant’s eligible dependents would be entitled under Section 4980B of the Internal Revenue Code (COBRA), then for a period not to exceed twelve (12) months the Company shall pay the excess of (i) the COBRA cost of such coverage over (ii) the amount that the Participant would have had to pay for such coverage if he had remained employed during such period and paid the active employee rate for such coverage, provided, however, that if the Participant becomes eligible to receive group health benefits under a program of a subsequent employer or otherwise (including coverage available to the Participant’s spouse), the Company’s obligation to pay any portion of the cost of health coverage as described herein shall cease, except as otherwise provided by law;

(c) with respect to Tier I Participants only, for 12 months following the Termination Date, the Participant shall be eligible for up to $20,000 of outplacement services payable by the Company directly to a provider or providers selected by the Participant, provided, however, that the Participant must provide written notification to the Company within six months following the Termination Date of his or her intention to utilize such outplacement services. With respect to Tier II Participants only, the Participant shall be eligible for outplacement services payable by the Company in accordance with Company policy in effect as of the Termination Date. The benefits provided under this Section 4.3(c) in any one calendar year shall not affect the amount of benefits provided in any other calendar year; the Company’s payment for such benefits shall be made on or before December 31 of the year following the year in which the expense was incurred; and the Participant’s rights to such benefits shall not be subject to liquidation or exchange for another benefit;

(d) all of the Participant’s equity or incentive awards outstanding on the Termination Date shall be governed by the plans under which they were granted and the agreements evidencing such awards; and

(e) to the extent not theretofore paid or provided, the Company shall timely pay or provide to the Participant Base Salary through the Termination Date, any accrued vacation pay to the extent not theretofore paid, and any other amounts or benefits required to be paid or provided or which the Participant is eligible to receive under any plan, program, policy or practice or contract or agreement of the Company and its affiliated companies.

4.4Amount of Regular Severance Benefits. If a Participant’s employment is terminated in circumstances entitling him or her to Regular Severance Benefits as provided in

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Section 4.2, then:

(a) the Company shall pay to the Participant, at the time or times specified below (or such later date as may be required by Section 8.2), the following amounts (for purposes of Section 409A of the Code, each installment shall be deemed to be a separate payment:

(i) the Company shall continue to pay Base Salary to the Participant for a number of months following the Termination Date and execution of the Release, in accordance with the Company’s normal payroll practices, equal to the following: (i) 12 months, in the case of all Tier I Participants and those Tier II Participants who as of the Termination Date have been employed by the Company for at least two years, or (ii) six months, in the case of Tier II Participants who as of the Termination Date have been employed by the Company for less than two years;

(ii) the Company shall pay to the Participant, at the same time annual bonus awards are payable to the Company’s other executive officers, a pro rata annual bonus, in an amount equal to the product of (A) Participant’s annual bonus which he or she would have earned for the year in which the Termination Date occurs, determined based on the Company’s actual performance for the full fiscal year (and disregarding for this purpose any individual performance metrics), and (B) a fraction, the numerator of which is the number of days in the current fiscal year through the Termination Date, and the denominator of which is 365; and

(iii)with respect to Tier I Participants only, the Company shall pay to the Tier I Participant for a period of 12 months following the Termination Date and execution of the Release, monthly payments equal to the full monthly cost to provide certain group health benefits sponsored by the Company and maintained by the Tier I Participant on the Termination Date. The amount payable under this Section 4.4(a)(iii) shall be calculated based on the monthly cost (including any portion of the cost paid by the employee) to provide the same level of coverage of such group health benefits maintained by the Tier I Participant as of the Termination Date. For purposes of this Section 4.4(a)(iii): (i) group health benefits means any of the following: group medical, dental, vision, and/or prescription drug benefits, and (ii) if the group health benefits are provided pursuant to an insurance contract issued by an insurance carrier to the Company, the cost of such benefits shall be determined based on the monthly premium charged to the Company for such coverage on the Termination Date or, if the group health benefits are self-insured by the Company, the cost of such benefits will be the “applicable premium” determined in accordance with Code Section 4980B(f)(4) and the regulations issued thereunder for such for the year in which the Termination Date occurs. The Tier I Participant will be entitled to make an election to continue group health benefits in accordance with the terms of the various group health plans; and

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(iv) with respect to Tier II Participants only, If the Tier II Participant elects to continue participation in any group medical, dental, vision and/or prescription drug plan benefits to which the Tier II Participant and/or the Tier II Participant’s eligible dependents would be entitled under Section 4980B of the Internal Revenue Code (COBRA), then for a period not to exceed the number of months the Tier II Participant is entitled to receive Base Salary continuation from the Company under Section 4.4(a)(i) above, the Company shall pay the excess of (i) the COBRA cost of such coverage over (ii) the amount that the Tier II Participant would have had to pay for such coverage if he had remained employed during such period and paid the active employee rate for such coverage, provided, however, that if the Tier II Participant becomes eligible to receive group health benefits under a program of a subsequent employer or otherwise (including coverage available to the Tier II Participant’s spouse), the Company’s obligation to pay any portion of the cost of health coverage as described herein shall cease, except as otherwise provided by law.

(b) with respect to Tier I Participants only, for 12 months following the Termination Date, the Participant shall be eligible for up to $20,000 of outplacement services payable by the Company directly to a provider or providers selected by the Participant, provided, however, that the Participant must provide written notification to the Company within six months following the Termination Date of his or her intention to utilize such outplacement services. With respect to Tier II Participants only, the Participant shall be eligible for outplacement services payable by the Company in accordance with Company policy in effect as of the Termination Date. The benefits provided under this Section 4.3(c) in any one calendar year shall not affect the amount of benefits provided in any other calendar year; the Company’s payment for such benefits shall be made on or before December 31 of the year following the year in which the expense was incurred; and the Participant’s rights to such benefits shall not be subject to liquidation or exchange for another benefit;

(c) all of the Participant’s equity or incentive awards outstanding on the Termination Date shall be governed by the plans under which they were granted and the agreements evidencing such awards; and

(d) to the extent not theretofore paid or provided, the Company shall timely pay or provide to the Participant Base Salary through the Termination Date, any accrued vacation pay to the extent not theretofore paid, and any other amounts or benefits required to be paid or provided or which the Participant is eligible to receive under any plan, program, policy or practice or contract or agreement of the Company and its affiliated companies.

4.5Non-Duplication of Benefits. In the event that a Participant becomes entitled to receive benefits under this Plan and any such benefit duplicates a benefit that would otherwise be provided under any other plan, program, arrangement or agreement as a result of the Participant’s

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termination of employment, then the Participant shall be entitled to receive the greater of the benefit available under the Plan, on the one hand, and the benefit available under such other plan, program, arrangement or agreement, on the other.

4.6Full Settlement; No Mitigation. The Company’s obligation to make the payments provided for under this Plan and otherwise to perform its obligations hereunder shall not be affected by any set-off, counterclaim, recoupment, defense or other claim, right or action which the Company may have against the Participant or others. In no event shall the Participant be obligated to seek other employment or take any other action by way of mitigation of the amounts payable to the Participant under any of the provisions of this Agreement and such amounts shall not be reduced whether or not the Participant obtains other employment.

ARTICLE 5

EFFECT OF SECTIONS 280G AND 4999 OF THE CODE

5.1Mandatory Reduction of Payments in Certain Events.

(a)Anything in this Plan to the contrary notwithstanding, in the event it shall be determined that any payment or distribution by the Company to or for the benefit of a Participant (whether paid or payable or distributed or distributable pursuant to the terms of this Plan or otherwise) (a "Payment") would be subject to the excise tax imposed by Section 4999 of the Code (the "Excise Tax"), then, prior to the making of any Payment to the Participant, a calculation shall be made comparing (i) the net benefit to the Participant of the Payment after payment of the Excise Tax, to (ii) the net benefit to the Participant if the Payment had been limited to the extent necessary to avoid being subject to the Excise Tax. If the amount calculated under (i) above is less than the amount calculated under (ii) above, then the Payment shall be limited to the extent necessary to avoid being subject to the Excise Tax (the "Reduced Amount"). In that event, the Participant shall direct which Payments are to be modified or reduced.

(b)The determination of whether an Excise Tax would be imposed, the amount of such Excise Tax, and the calculation of the amounts referred to Section 5.1(a)(i) and (ii) above shall be made by an independent, nationally recognized accounting firm or compensation consulting firm mutually acceptable to the Company and the Participant (the "Determination Firm") which shall provide detailed supporting calculations. Any determination by the Determination Firm shall be binding upon the Company and the Participant. As a result of the uncertainty in the application of Section 4999 of the Code at the time of the initial determination by the Determination Firm hereunder, it is possible that Payments which the Participant was entitled to, but did not receive pursuant to Section 5.1(a), could have been made without the imposition of the Excise Tax ("Underpayment"). In such event, the Determination Firm shall determine the amount of the Underpayment that has occurred and any such Underpayment shall be promptly paid by the Company to or for the benefit of the Participant.

(c)In the event that the provisions of Code Section 280G and 4999 or any successor provisions are repealed without succession, this Article 5 shall be of no further force or effect.

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ARTICLE 6

TERMINATION OF EMPLOYMENT

6.1Written Notice Required. Any purported termination of employment, whether by the Company or by the Participant, shall be communicated by written notice to the other (a “Notice of Termination”).

6.2Termination Date. In the case of the Participant's death, the Participant's Termination Date shall be his or her date of death. In all other cases, the Participant's Termination Date shall be the date of receipt of the Notice of Termination or any later date specified therein within 60 days after receipt of the Notice of Termination.

ARTICLE 7

DURATION, AMENDMENT AND TERMINATION, CLAIMS

7.1Duration. The Plan shall become effective as of the Effective Date, and shall continue until terminated by the Committee or the Board. Subject to Section 7.2, the Committee or the Board may terminate the Plan as of any date that is at least 12 months after the date of the Committee or the Board’s action. If any Participants become entitled to any payments or benefits hereunder during such 12-month period, this Plan shall continue in full force and effect and shall not terminate or expire with respect to such Participants until after all such Participants have received such payments and benefits in full.

7.2Amendment and Termination. Subject to the following sentence, the Plan may be amended from time to time in any respect by the Committee or the Board; provided, however, that any amendment that would adversely affect the rights or potential rights of Participants shall not be effective for at least 12 months after the date of the Committee or the Board’s action; and, provided further, in the event that a Change in Control occurs within 12 months following an amendment to the Plan that would adversely affect the rights or potential rights of Participants, the amendment will not be effective. In anticipation of or in connection with or within three years following a Change in Control, the Plan shall not be subject to amendment, change, substitution, deletion, revocation or termination in any respect which adversely affects the rights of Participants without the consent of each Participant so affected. For the avoidance of doubt, removal of a Participant as a Participant (other than as a result of the Participant ceasing to be an Employee), a decrease in the Participant’s Tier Level or any other reduction in payments or benefits shall be deemed to be an amendment of the Plan which adversely affects the rights of the Participant.

7.3Form of Amendment. The form of any amendment or termination of the Plan shall be a written instrument signed by a duly authorized officer or officers of the Company, certifying that the amendment or termination has been approved by the Committee or the Board. Subject to Sections 7.1 and 7.2 above (i) an amendment of the Plan in accordance with the terms hereof shall automatically effect a corresponding amendment to all Participants’ rights and benefits hereunder, and (ii) a termination of the Plan shall in accordance with the terms hereof

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automatically effect a termination of all Participants’ rights and benefits hereunder.

7.4Claims Procedure.

(a)A Participant may file a claim with respect to amounts asserted to be due hereunder by filing a written claim with the Committee specifying the nature of such claim in detail. The Committee shall notify the claimant within 60 days as to whether the claim is allowed or denied, unless the claimant receives written notice from the Committee prior to the end of the 60 day period stating that special circumstances require an extension of time for a decision on the claim, in which case the period shall be extended by an additional 60 days. Notice of the Committee's decision shall be in writing, sent by mail to the Participant's last known address and, if the claim is denied, such notice shall (i) state the specific reasons for denial, (ii) refer to the specific provisions of the Plan upon which such denial is based, and (iii) if applicable, describe any additional information or material necessary to perfect the claim, an explanation of why such information or material is necessary, and an explanation of the review procedure in Section 7.4(b).

(b)A claimant is entitled to request a review of any denial of his claim under Section 7.4(a). The request for review must be submitted to the Committee in writing within 60 days of mailing by the Committee of notice of the denial. Absent a request for review within the 60 day period, the claim will be deemed conclusively denied. The claimant or his representative shall be entitled to review all pertinent documents, and to submit issues and comments orally and in writing to the Committee. The review shall be conducted by the Committee, which shall afford the claimant a hearing and which shall render a decision in writing within 60 days of a request for a review, provided that, if the Committee determines prior to the end of such 60 day review period that special circumstances require an extension of time for the review and decision of the denial, the period for review and decision on the denial shall be extended by an additional 60 days. The claimant shall receive written notice of the Committee's review decision, together with specific reasons for the decision and reference to the pertinent provisions of the Plan.

ARTICLE 8

CODE SECTION 409A

8.1Notwithstanding anything in this Plan to the contrary, to the extent that any amount or benefit that would constitute non-exempt “deferred compensation” for purposes of Section 409A of the Code would otherwise be payable or distributable hereunder by reason of a Participant’s termination of employment, such amount or benefit will not be payable or distributable to the Participant by reason of such circumstance unless (i) the circumstances giving rise to such termination of employment meet any description or definition of “separation from service” in Section 409A of the Code and applicable regulations (without giving effect to any elective provisions that may be available under such definition), or (ii) the payment or distribution of such amount or benefit would be exempt from the application of Section 409A of the Code by reason of the short-term deferral exemption or otherwise. This provision does not prohibit the vesting of any amount upon a termination of employment, however defined. If this provision prevents the payment or distribution of any amount or benefit, such payment or

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distribution shall be made on the date, if any, on which an event occurs that constitutes a Section 409A-compliant “separation from service” or such later date as may be required by Section 8.2 below.

8.2Notwithstanding anything in this Plan to the contrary, if any amount or benefit that would constitute non-exempt “deferred compensation” for purposes of Section 409A of the Code would otherwise be payable or distributable under this Plan by reason of a Participant’s separation from service during a period in which he is a Specified Employee (as defined below), then, subject to any permissible acceleration of payment by the Company under Treas. Reg. Section 1.409A-3(j)(4)(ii) (domestic relations order), (j)(4)(iii) (conflicts of interest), or (j)(4)(vi) (payment of employment taxes):

(a)    if the payment or distribution is payable in a lump sum, the Participant’s right to receive payment or distribution of such non-exempt deferred compensation will be delayed until the earlier of the Participant’s death or the first day of the seventh month following the Participant’s separation from service; and

(b)    if the payment or distribution is payable over time, the amount of such non-exempt deferred compensation that would otherwise be payable during the six-month period immediately following the Participant’s separation from service will be accumulated and the Participant’s right to receive payment or distribution of such accumulated amount will be delayed until the earlier of the Participant’s death or the first day of the seventh month following the Participant’s separation from service, whereupon the accumulated amount will be paid or distributed to the Participant and the normal payment or distribution schedule for any remaining payments or distributions will resume.

For purposes of this Agreement, the term “Specified Employee” has the meaning given such term in Code Section 409A and the final regulations thereunder (“Final 409A Regulations”), provided, however, that, as permitted in the Final 409A Regulations, the Company’s Specified Employees and its application of the six-month delay rule of Code Section 409A(a)(2)(B)(i) shall be determined in accordance with rules adopted by the Board of Directors, which shall be applied consistently with respect to all nonqualified deferred compensation arrangements of the Company, including this Plan.

ARTICLE 9

MISCELLANEOUS

9.1    Legal Fees and Expenses. The Company shall reimburse all legal fees and related expenses (including the costs of experts, evidence and counsel) reasonably and in good faith incurred by a Participant if the Participant prevails on a material issue with respect to his or her claim for relief in an action by the Participant to obtain or enforce any right or benefit provided by this Plan. If a Participant is entitled to recover fees and expenses under this Section 9.1, the reimbursement of an eligible expense shall be made within 10 business days after delivery of the Participant’s respective written requests for payment accompanied with such evidence of fees

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and expenses incurred as the Company reasonably may require, but in no event later than March 15 of the year after the year in which such rights are established.

9.2    Employment Status. This Plan does not constitute a contract of employment or impose on the Participant or the Company any obligation to retain the Participant as an Employee, to change the status of the Participant’s employment, or to change the Company’s policies regarding termination of employment.

9.3    Nature of Plan and Benefits. Participants and any other person who may have rights hereunder shall be mere unsecured general creditors of the Company with respect to a Severance Benefits due hereunder, and all amounts (other than fully insured benefits) shall be payable from the general assets of the Company.

9.4    Withholding of Taxes. The Company may withhold from any amount payable or benefit provided under this Plan such Federal, state, local, foreign and other taxes as are required to be withheld pursuant to any applicable law or regulation.

9.5    No Effect on Other Benefits. Severance Benefits shall not be counted as compensation for purposes of determining benefits under other benefit plans, programs, policies and agreements, except to the extent expressly provided therein or herein.

9.6    Validity and Severability. The invalidity or unenforceability of any provision of the Plan shall not affect the validity or enforceability of any other provision of the Plan, which shall remain in full force and effect, and any prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction.

9.7    Successors. This Plan shall bind any successor of or to the Company, its assets or its businesses (whether direct or indirect, by purchase, merger, consolidation or otherwise), in the same manner and to the same extent that the Company would be obligated under this Plan if no succession had taken place. In the case of any transaction in which a successor would not by the foregoing provision or by operation of law be bound by this Plan, the Company shall require such successor expressly and unconditionally to assume and agree to perform the Company’s obligations under this Plan, in the same manner and to the same extent that the Company would be required to perform if no such succession had taken place. The term “Company,” as used in this Plan, shall mean the Company as hereinbefore defined and any successor or assignee to the business or assets which by reason hereof becomes bound by this Plan.

9.8    Assignment. This Plan shall inure to the benefit of and shall be enforceable by a Participant’s personal or legal representatives, executors, administrators, successors, heirs, distributees, devisees and legatees. If a Participant should die while any amount is still payable to the Participant under this Plan had the Participant continued to live, all such amounts, unless otherwise provided herein, shall be paid in accordance with the terms of this Plan to the Participant’s estate. A Participant’s rights under this Plan shall not otherwise be transferable or subject to lien or attachment.

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9.9    Enforcement. This Plan is intended to constitute an enforceable contract between the Company and each Participant subject to the terms hereof.

9.10    Governing Law. To the extent not preempted by ERISA, the validity, interpretation, construction and performance of the Plan shall in all respects be governed by the laws of Delaware, without reference to principles of conflict of law.

9.11    Arbitration. Any dispute or controversy arising under or in connection with this Plan that cannot be mutually resolved by the Company and a Participant and their respective advisors and representatives shall be settled exclusively by arbitration in Atlanta, Georgia in accordance with the rules of the American Arbitration Association before one arbitrator of exemplary qualifications and stature, who shall be selected jointly by an individual to be designated by the Company and an individual to be selected by the Participant, or if such two individuals cannot agree on the selection of the arbitrator, who shall be selected by the American Arbitration Association.The Company shall reimburse the Participant’s reasonable legal fees if he prevails on a material issue in arbitration.

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EXHIBIT A

SEPARATION AGREEMENT AND GENERAL RELEASE

(Date Given to Employee)

This Separation Agreement and General Release (this "Agreement") is entered into by and between Denny's Corporation (together with its subsidiaries and affiliates, the "Company") and the undersigned employee ("Employee").

Notice to Employee:

Under the Denny's Corporation Amended and Restated Executive and Key Employee Severance Pay Plan (the "Plan") you are eligible to receive severance pay if you agree to waive, to the extent permitted by law, all of your potential claims against the Company and agree to the other terms in this Separation Agreement. This means that you cannot sue or pursue any other claim against the Company as provided for in this release. PLEASE READ THIS DOCUMENT CAREFULLY BEFORE YOU SIGN IT. ALSO, YOU ARE ADVISED TO CONSULT AN ATTORNEY OR OTHER REPRESENTATIVE BEFORE SIGNING THIS DOCUMENT. YOU HAVE TWENTY-ONE (21) DAYS TO THINK ABOUT WHETHER YOU WANT TO SIGN THIS DOCUMENT AND TO CONSULT WHOMEVER YOU WISH.

1.    In consideration for signing this Separation Agreement and General Release, you are entitled to receive severance pay and benefits under the Plan.

2.    IF YOU SIGN THIS AGREEMENT, YOU ARE PERMANENTLY WAIVING (GIVING UP) YOUR RIGHT TO SUE THE COMPANY FOR ANY REASON PROVIDED HEREIN. YOUR WAIVER WILL INCLUDE ANY RIGHTS YOU HAVE TO SUE THE COMPANY UNDER THE AGE DISCRIMINATION IN EMPLOYMENT ACT, TITLE VII OF THE CIVIL RIGHTS ACT, THE AMERICANS WITH DISABILITIES ACT, STATE WRONGFUL TERMINATION LAWS, AND ALL OTHER LAWS AND REGULATIONS UNDER WHICH YOU MIGHT BE ABLE TO ASSERT ANY CLAIM AGAINST THE COMPANY.

3.    You will be waiving all claims which have arisen or may arise in the future, whether known or unknown, that are based on acts or events that have occurred up until the Effective Date (as defined herein).

4.    Because this waiver involves your legal rights, you are advised to speak with an attorney before signing this Agreement. You have twenty-one (21) days from the date listed at the top of this page to make your decision. If you have not signed this Agreement by the end of the twenty-first (21st) day after the date listed above, you will be ineligible to receive any severance pay.

5.     In addition, you will have seven (7) days from the date you sign this Agreement to revoke it. This means that if you change your mind for any reason after signing the Agreement, you can

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revoke it if you notify the Company within seven (7) days. You must notify the Company in writing and the notice must be received by the Company within seven (7) days of the date you sign this Agreement. This Agreement will become effective on the eighth (8th)day after you sign it (the “Effective Date”). Any revocation of this Agreement must be made in writing and delivered within the seven-day revocation period to: Senior Vice-President of Human Resources, Denny's Corporation, 203 East Main Street, Spartanburg, SC 29319.

Part I        Release of Claims and Covenant Not to Sue.

In consideration of the severance pay from the Company set forth above, the receipt and sufficiency of which are hereby acknowledged, Employee, on behalf of himself and his agents and successors in interest, hereby UNCONDITIONALLY RELEASES AND DISCHARGES Company, its successors, subsidiaries, parent corporations, assigns, joint ventures, and affiliated companies, and their respective agents, legal representatives, shareholders, attorneys, employees, officers and directors, (collectively, the “Releasees”) from ALL CLAIMS, LIABILITIES, DEMANDS AND CAUSES OF ACTION, whether known or unknown, fixed or contingent, that he may have or claim to have against Company or any of the Releasees for any reason as of the Effective Date (as defined above). Except to the extent that applicable law requires that Employee be allowed to file a Charge with the Equal Employment Opportunity Commission (“EEOC”), Employee further hereby AGREES NOT TO FILE A LAWSUIT or other legal claim or charge or to assert any claim against any of the Releasees based on facts that occurred prior to, or that exist as of, the Effective Date. This Release and Covenant Not To Sue includes, but is not limited to, claims arising under federal, state or local laws prohibiting employment discrimination, claims arising under severance plans and contracts, and claims growing out of any legal restrictions on Company’s rights to terminate its employees or to take any other employment action, whether statutory, contractual or arising under common law or case law. Employee specifically acknowledges and agrees that he is releasing any and all rights under federal, state and local employment laws including, without limitation, the Age Discrimination in Employment Act of 1967 (“ADEA”), as amended, 29 U.S.C. § 621, etseq., the Civil Rights Act of 1964 (“Title VII”), as amended, 42 U.S.C. § 2000e, etseq., 42 U.S.C. § 1981, as amended, the Americans With Disabilities Act (“ADA”), as amended, 42 U.S.C. § 12101 etseq., the Rehabilitation Act of 1973, as amended, as amended, 29 U.S.C. § 701, etseq., the Employee Retirement Income Security Act of 1974 (“ERISA”), as amended, 29 U.S.C. § 301 etseq., the Worker Adjustment and Retraining Notification Act (“WARN”), 29 U.S.C. § 2101, etseq., the Family and Medical Leave Act of 1993 (“FMLA”), as amended, 29 U.S.C. § 2601 etseq., the Fair Labor Standards Act (“FLSA”), as amended, 29 U.S.C. § 201 etseq., the Employee Polygraph Protection Act of 1988, 29 U.S.C. § 2001, etseq., all other state and federal code sections and legal principles, including, without limitation, claims for defamation and slander, and the state and federal worker’s compensation laws. Employee further agrees that if anyone (including, but not limited to, Employee, the EEOC or any other government agency or similar such body) makes a claim or undertakes an investigation involving Employee in any way, Employee waives any and all right and claim to financial recovery resulting from such claim or investigation.

As a material inducement for Denny’s Corporation to enter into this Agreement, Employee represents and warrants that he does not have any complaint, claim or action pending against

2

Company or any of the Releasees in any federal, state or local court or government agency or before any arbitrator or other tribunal.

Part II    Restrictions on Employee's Conduct.

(a)    General. Employee understands and agrees that the purpose of the provisions of this Part II is to protect the legitimate business interests of the Company, as more fully described below, and is not intended to impair or infringe upon Employee's right to work or earn a living. Employee hereby acknowledges and agrees (i) that Employee has received good and valuable consideration for the post-employment restrictions set forth in this Part II in the form of the compensation and benefits provided for in the Plan, and (ii) that the post-employment restrictions set forth in this Part II are reasonable and that they do not, and will not, unduly impair Employee's ability to earn a living.

(b)    Definitions. The following capitalized terms used in this Part II

shall have the following meanings:

"Competitive Services" means the partial or total ownership, management or operation of any restaurant or restaurant chain within the family dining segment, including, without limitation, the provision of consulting or advising services to any Person (as defined herein) engaged in the ownership, management or operation of any restaurant or restaurant chain in the family dining segment, whether such services are paid or unpaid.

"Confidential Information" means all information regarding the Company, its activities, businesses or customers that is the subject of reasonable efforts by the Company to maintain its confidentiality and that is not generally disclosed by practice or authority to persons not employed by the Company, but that does not rise to the level of a Trade Secret (as defined herein). "Confidential Information" shall include, but is not limited to, financial plans and data concerning the Company; management planning information; business plans; operational methods; market studies; marketing plans or strategies; product development techniques or plans; customer lists; customer files, data and financial information, details of customer contracts; current and anticipated customer requirements; identifying and other information pertaining to business referral sources; past, current and planned research and development; business acquisition plans; and new personnel acquisition plans. "Confidential Information" shall not include information that has become generally available to the public by the act of one who has the right to disclose such information without violating any right or privilege of the Company. This definition shall not limit any definition of "confidential information" or "trade secrets" or any equivalent term under state or federal law.

"Person" means any individual or any corporation, partnership, joint venture, limited liability company, association or other entity or enterprise.

"Principal or Representative" means a principal, owner, partner, shareholder, joint venturer, investor, member, trustee, director, officer, manager, employee, agent, representative or consultant.

3

"Protected Customers" means any then-current customer to whom Company sold its products or services at any time during Employee's employment and (a) with whom Employee had business dealings on behalf of Company; (b) for whom Employee supervised or coordinated the dealings with Company; or (c) about whom Employee obtained Trade Secrets or Confidential Information (as defined herein) as a result of his employment.

"Protected Employees" means any then-current employees of the Company who were employed by the Company at any time during Employee’s employment.

"Restricted Territory" means the United States of America.

"Restrictive Covenants" means the restrictive covenants contained in Part II of this Agreement.

"Separation Date" means the date of Employee's termination of employment for any reason whatsoever.

“Trade Secrets” means all information regarding Company, its activities, businesses or customers, without regard to form, including, but not limited to, technical or nontechnical data, a formula, a pattern, a compilation, a program, a device, a method, a technique, a drawing, a process, financial data, financial plans, product plans, distribution lists or a list of actual or potential customers, advertisers or suppliers, which is not commonly known by or available to the public and which information: (A) derives economic value, actual or potential, from not being generally known to, and not being readily ascertainable by proper means by, other persons who can obtain economic value from its disclosure or use; and (B) is the subject of efforts that are reasonable under the circumstances to maintain its secrecy. Without limiting the foregoing, Trade Secret means any item of confidential information that constitutes a “trade secret(s)” under applicable common law or statutory law.

(c)Restrictive Covenants.

(i)Restriction on Disclosure and Use of Confidential Information and Trade Secrets. Employee hereby agrees that Employee shall not, directly or indirectly, at any time during the two (2) years following the Separation Date, reveal, divulge, or disclose to any Person not expressly authorized by Company any Confidential Information, and Employee shall not, directly or indirectly, at any time during the two (2) years following the Separation Date, use or make use of any Confidential Information in connection with any business activity other than that of Company. At all times after the Separation Date, Employee shall not, directly or indirectly, transmit or disclose any Trade Secret to any Person other than Company, and shall not make use of any such Trade Secret, directly or indirectly, for himself or for any Person other than Company. The Parties acknowledge and agree that this Agreement is not intended to, and does not, alter either Company’s rights or Employee’s obligations under any state or federal statutory or common law regarding trade secrets and unfair trade practices. Anything herein to the contrary notwithstanding, Employee shall not be restricted from disclosing or using Confidential Information that is required to be disclosed by law, court order or other legal process; provided,

4

however, that in the event disclosure is required by law, Employee shall provide Company with at least five (5) days written notice of such requirement prior to any such disclosure.

(ii)Nonsolicitation of Protected Employees. Employee agrees that during the twelve (12) month period following the Separation Date, Employee shall not, directly or indirectly, on Employee's own behalf or on behalf of any other Person, solicit or induce or attempt to solicit or induce any Protected Employee to terminate his or her employment relationship with the Company or to enter into employment with any other Person.

(iii)Restriction on Relationships with Protected Customers. Employee hereby agrees that, during the twelve (12) month period following the Separation Date, Employee shall not, without the prior written consent of the Company, directly or indirectly, on Employee's own behalf or on behalf of any other Person, solicit, divert, take away or attempt to solicit, divert or take away a Protected Customer for the purpose of selling or otherwise providing goods or services the same as or similar to the goods or services offered by Company.

(iv) Noncompetition with the Company. Employee hereby agrees that, during the twelve (12) month period following the Separation Date, Employee will not, without prior written consent of the Company, directly or indirectly, engage in, sell or otherwise provide Competitive Services within the Restricted Territory in a capacity that is the same as or substantially similar to the capacity in which he was engaged by Company, whether on his behalf or as a Principal or Representative of any other Person; provided, however, that the provisions of this Agreement shall not be deemed to prohibit the ownership by Employee of not more than five percent (5%) of any class of securities of any corporation having a class of securities registered pursuant to the Securities Exchange Act of 1934, as amended. .

(d)Enforcement of Restrictive Covenants.

(i)Rights and Remedies Upon Breach. In the event Employee breaches, or threatens to commit a breach of, any of the provisions of the Restrictive Covenants, the Company shall have the right and remedy to enjoin Employee, preliminarily and permanently, from violating or threatening to violate the Restrictive Covenants and to have the Restrictive Covenants specifically enforced by any court or tribunal of competent jurisdiction, it being agreed that any breach or threatened breach of the Restrictive Covenants would cause irreparable injury to the Company and that money damages would not provide an adequate remedy to the Company. Such right and remedy shall be independent of any others and severally enforceable, and shall be in addition to, and not in lieu of, any other rights and remedies available to the Company at law or in equity. Without limiting the foregoing sentence, in the event Employee breaches any of the provisions of the Restrictive Covenants, (i) Employee shall cease to have any rights to payments and benefits under the Plan, (ii) all payments and benefits thereunder to Employee shall cease, and (iii) Employee shall repay to the Company any payments or benefits under the Plan that had already been provided to Employee prior to such breach, including both cash payments and the value of benefits continuation (calculated pursuant to Section 2.01 of the Plan).

(ii)Severability of Covenants. Employee acknowledges and agrees that the Restrictive Covenants are reasonable and valid in time and scope and in all other respects.

5

The covenants set forth in Part II of this Agreement shall be considered and construed as separate and independent covenants. Should any part or provision of any covenant be held invalid, void or unenforceable, such invalidity, voidness or unenforceability shall not render invalid, void or unenforceable any other part or provision of this Agreement.

(iii)Reformation. If any portion of any of the Restrictive Covenants is found to be invalid or unenforceable because its duration, the territory, the definition of activities or the definition of information covered is considered to be invalid or unreasonable in scope, the invalid or unreasonable term shall be redefined, or a new enforceable term provided, such that the intent of the parties in agreeing to the provisions of Part II of this Agreement will not be impaired and the provision in question shall be enforceable to the fullest extent of the applicable laws.

(e) Governing Law; Jurisdiction. This Agreement shall be governed by and construed in accordance with the laws of the State of South Carolina, without regard to principles of conflicts of laws. Employee hereby irrevocably consents to the exclusive jurisdiction of the state and federal courts of the State of South Carolina, which shall have jurisdiction to hear and determine any claim, cause of action or controversy arising from or relating to this Agreement.

Part IIINon-Disparagement.

Employee hereby agrees that he shall not disparage, criticize or otherwise publish or communicate any statements or opinions that are derogatory to or could otherwise harm the business or reputation of the Company. However, Employee is not restricted from making any factual statement that is required to be disclosed by law, subpoena, court order or other legal process.

Part IVReturn of Property.

Employee agrees to return immediately and warrants that he has returned before executing or receiving payment pursuant to this Agreement, all documents, materials and other things in his possession or control relating to Company, or that have been in his possession or control at the time of or since the termination of his employment with Company, without retaining any copies, summaries, abstracts, excerpts, portions, replicas or other representations thereof. Employee likewise represents and warrants that Company has returned all of Employee’s personal property and that any such property is no longer in possession of Company.

This Agreement has been executed voluntarily by the parties. The parties acknowledge that they have read this Agreement carefully, that they have had a full and reasonable opportunity to consider this Agreement, and that they have not been pressured or in any way coerced, threatened or intimidated into its execution.

6

SIGNATURE BY EMPLOYEE

I acknowledge that I have been advised to consult with an attorney prior to signing this Agreement. I further acknowledge that the consideration for signing this Agreement is a benefit to which I otherwise would not have been entitled had I not signed this Agreement.

I have read this entire document and I understand and agree to each of its terms. SPECIFICALLY, I AGREE THAT BY SIGNING THIS DOCUMENT, I AM WAIVING MY RIGHTS TO SUE THE COMPANY AS SET FORTH ABOVE IN PART I. I also understand that this is the entire Agreement between the Company and me regarding severance pay and the termination of my employment and that no other agreements or promises about those matters, written or oral will be enforceable.

(Signature of Employee)	(Date Signed)
(Print Employee Name)	(Witness)

ACCEPTANCE BY THE COMPANY

The Company hereby enters into and accepts this Agreement as set forth above.

DENNY'S CORPORATION

By:

Name:

Title:

7

EX-31.1

Exhibit 31.1

CERTIFICATION

I, John C. Miller, certify that:

1. I have reviewed this report on Form 10-Q of Denny’s Corporation;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent function):

a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal controls over financial reporting.

Date: October 28, 2013	By:	/s/ John C. Miller
		John C. Miller
		President and Chief Executive Officer

EX-31.2

Exhibit 31.2

CERTIFICATION

I, F. Mark Wolfinger, certify that:

1. I have reviewed this report on Form 10-Q of Denny’s Corporation;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent function):

a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal controls over financial reporting.

Date: October 28, 2013	By:	/s/ F. Mark Wolfinger
		F. Mark Wolfinger
		Executive Vice President,
		Chief Administrative Officer and
		Chief Financial Officer

EX-32.1

Exhibit 32.1

CERTIFICATION

John C. Miller

President and Chief Executive Officer of Denny’s Corporation

and

F. Mark Wolfinger

Executive Vice President, Chief Administrative Officer and Chief Financial Officer

Pursuant to 18 U.S.C. Section 1350,

As Adopted Pursuant to

Section 906 of the Sarbanes-Oxley Act of 2002

In connection with the Quarterly Report of Denny’s Corporation (the “Company”) on Form 10-Q for the period ended September 25, 2013 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, John C. Miller, President and Chief Executive Officer of the Company, and I, F. Mark Wolfinger, Executive Vice President, Chief Administrative Officer and Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: October 28, 2013	By:	/s/ John C. Miller
		John C. Miller
		President and Chief Executive Officer

Date: October 28, 2013	By:	/s/ F. Mark Wolfinger
		F. Mark Wolfinger
		Executive Vice President,
		Chief Administrative Officer and
		Chief Financial Officer

A signed original of this written statement required by Section 906, or other document authenticating, acknowledging, or otherwise adopting the signature that appears in typed form within the electronic version of this written statement required by Section 906, has been provided to Denny’s Corporation and will be retained by Denny’s Corporation and furnished to the Securities and Exchange Commission or its staff upon request.

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Income Taxes

9 Months Ended

Sep. 25, 2013

Income Tax Disclosure [Abstract]

Income Taxes

Income Taxes

The provision for income taxes was $10.4 million and $10.3 million for the three quarters ended September 25, 2013 and September 26, 2012, respectively. For the 2013 period, the difference in the overall effective rate from the U.S. Statutory rate was due to state and foreign taxes, employment tax credits, and discrete tax items. The passage of the American Tax Payer Relief Act of 2012 resulted in deferred tax benefits of $0.3 million related to work opportunity credits generated in 2012, which were allowed retroactively. In addition, state jobs tax credits of $0.8 million were claimed during the 2013 period resulting from the prior year's hiring activity. A valuation allowance of $0.5 million was recorded against certain state jobs tax credits during the 2013 period related to changes in California law enacted during the period. The provision for income taxes for the 2012 period was determined using our effective rate estimated for the entire fiscal year.

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Condensed Consolidated Statements of Comprehensive Income (Unaudited) (USD $) In Thousands, except Per Share data, unless otherwise specified	3 Months Ended		9 Months Ended
	Sep. 25, 2013	Sep. 26, 2012	Sep. 25, 2013	Sep. 26, 2012
Revenue:
Company restaurant sales	$ 83,371	$ 86,575	$ 247,242	$ 271,977
Franchise and license revenue	33,904	34,370	101,094	100,437
Total operating revenue	117,275	120,945	348,336	372,414
Costs of company restaurant sales:
Product costs	21,722	21,449	64,270	67,684
Payroll and benefits	33,746	34,409	98,512	108,779
Occupancy	5,598	5,780	16,339	17,776
Other operating expenses	12,022	12,170	34,538	37,267
Total costs of company restaurant sales	73,088	73,808	213,659	231,506
Costs of franchise and license revenue	11,599	12,078	34,586	34,776
General and administrative expenses	13,704	14,702	42,948	45,150
Depreciation and amortization	5,198	5,287	15,774	17,174
Operating (gains), losses and other charges, net	161	3,380	1,779	(794)
Total operating costs and expenses, net	103,750	109,255	308,746	327,812
Operating income	13,525	11,690	39,590	44,602
Interest expense, net	2,452	3,088	7,800	10,537
Other nonoperating (income) expense, net	(276)	38	1,056	7,941
Net income before income taxes	11,349	8,564	30,734	26,124
Provision for income taxes	4,318	3,201	10,424	10,295
Net income	7,031	5,363	20,310	15,829
Basic net income per share	$ 0.08	$ 0.06	$ 0.22	$ 0.17
Diluted net income per share	$ 0.08	$ 0.06	$ 0.22	$ 0.16
Basic weighted average shares outstanding	90,035	94,705	91,348	95,472
Diluted weighted average shares outstanding	91,967	96,745	93,377	97,196
Comprehensive income	$ 6,574	$ 5,631	$ 22,702	$ 16,633

XML

Receivables

9 Months Ended

Sep. 25, 2013

Receivables [Abstract]

Receivables

Receivables

Receivables were comprised of the following:

	September 25, 2013			December 26, 2012
	(In thousands)
Current assets:
Receivables:
Trade accounts receivable from franchisees	$	9,228		$	10,212
Notes receivable from franchisees	2,049			4,310
Vendor receivables	1,130			2,529
Credit card receivables	792			1,384
Other	1,193			1,524
Allowance for doubtful accounts	(225		)	(12		)
Total current receivables, net	$	14,167		$	19,947
Noncurrent assets (included as a component of other noncurrent assets):
Notes receivable from franchisees	$	842		$	1,002

For the quarter and three quarters ended September 25, 2013, we recorded provisions for credit losses of $0.1 million. For the quarter and three quarters ended September 26, 2012, we recorded provisions for credit losses of less than $0.1 million. These amounts are included as a component of costs of franchise and license revenue on our Condensed Consolidated Statements of Comprehensive Income.

For the quarters and three quarters ended September 25, 2013 and September 26, 2012, we recognized interest income on notes receivable from franchisees of less than $0.1 million. These amounts are included as a component of interest expense, net on our Condensed Consolidated Statements of Comprehensive Income.

XML

Introduction and Basis of Presentation (Tables)

9 Months Ended

Sep. 25, 2013

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Company and franchise unit activity

The following table shows the unit activity for the quarter and three quarters endedSeptember 25, 2013 and September 26, 2012, respectively:

	Quarter Ended				Three Quarters Ended
	September 25, 2013		September 26, 2012		September 25, 2013		September 26, 2012
Company restaurants, beginning of period	165		177		164		206
Units opened	—		—		—		—
Units acquired from franchisees	1		—		2		—
Units sold to franchisees	(2	)	(5	)	(2	)	(28	)
Units closed	—		(1	)	—		(7	)
End of period	164		171		164		171
Franchised and licensed restaurants, beginning of period	1,525		1,507		1,524		1,479
Units opened	9		12		27		27
Units purchased from Company	2		5		2		28
Units acquired by Company	(1	)	—		(2	)	—
Units closed	(13	)	(8	)	(29	)	(18	)
End of period	1,522		1,516		1,522		1,516
Total restaurants, end of period	1,686		1,687		1,686		1,687

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Net Income Per Share

9 Months Ended

Sep. 25, 2013

Earnings Per Share [Abstract]

Net Income Per Share

Net Income Per Share

The amounts used for the basic and diluted net income per share calculation are summarized below:

	Quarter Ended				Three Quarters Ended
	September 25, 2013		September 26, 2012		September 25, 2013		September 26, 2012
	(In thousands, except for per share amounts)
Net income	$	7,031	$	5,363	$	20,310	$	15,829
Weighted average shares outstanding - basic	90,035		94,705		91,348		95,472
Effect of dilutive share-based compensation awards	1,932		2,040		2,029		1,724
Weighted average shares outstanding - diluted	91,967		96,745		93,377		97,196
Basic net income per share	$	0.08	$	0.06	$	0.22	$	0.17
Diluted net income per share	$	0.08	$	0.06	$	0.22	$	0.16
Anti-dilutive share-based compensation awards	331		116		331		1,902

XML

Long-Term Debt (Details) (USD $)	9 Months Ended		8 Months Ended		8 Months Ended	9 Months Ended		8 Months Ended					9 Months Ended	3 Months Ended		9 Months Ended		9 Months Ended		9 Months Ended
	Sep. 25, 2013	Sep. 26, 2012	Dec. 25, 2013 Credit Facility Due April 2018 [Member]	Apr. 24, 2013 Credit Facility Due April 2018 [Member]	Dec. 25, 2013 Credit Facility Due April 2018 [Member] Secured Debt [Member]	Sep. 25, 2013 Credit Facility Due April 2018 [Member] Secured Debt [Member]	Apr. 24, 2013 Credit Facility Due April 2018 [Member] Secured Debt [Member]	Dec. 25, 2013 Credit Facility Due April 2018 [Member] Senior secured revolver [Member]	Sep. 25, 2013 Credit Facility Due April 2018 [Member] Senior secured revolver [Member]	Apr. 24, 2013 Credit Facility Due April 2018 [Member] Senior secured revolver [Member]	Sep. 25, 2013 Credit Facility Due April 2018 [Member] Letter of Credit [Member]	Apr. 24, 2013 Credit Facility Due April 2018 [Member] Letter of Credit [Member]	Sep. 25, 2013 Credit Facility Due April 2017 [Member]	Mar. 27, 2013 Credit Facility Due April 2017 [Member] Secured Debt [Member]	Dec. 26, 2012 Credit Facility Due April 2017 [Member] Secured Debt [Member]	Sep. 25, 2013 Interest Rate Cap [Member] Interest Rate Cap 2012-2013 [Member]	Apr. 13, 2012 Interest Rate Cap [Member] Interest Rate Cap 2012-2013 [Member]	Sep. 25, 2013 Interest Rate Cap [Member] Interest Rate Cap 2013-2014 [Member]	Apr. 13, 2012 Interest Rate Cap [Member] Interest Rate Cap 2013-2014 [Member]	Sep. 25, 2013 Interest Rate Cap [Member] Interest Rate Cap 2014-2015 [Member]	Apr. 30, 2013 Interest Rate Cap [Member] Interest Rate Cap 2014-2015 [Member]	Apr. 30, 2013 Interest Rate Swap [Member] Interest Rate Swaps 2015-2017 [Member]	Apr. 30, 2013 Interest Rate Swap [Member] Interest Rate Swaps 2017-2018 [Member]
Line of Credit Facility [Line Items]
Aggregate principal amount as per new credit facility				$ 250,000,000
Line of Credit Facility, Current Borrowing Capacity							60,000,000			190,000,000		30,000,000
Commitment fee for unused portion of revolving credit facility (in hundredths)								0.35%
Basis spread on variable rate debt					2.00%
Accordion feature that allows increase in size of facility				300,000,000
Maturity date			Apr. 24, 2018
Debt Instrument, Periodic Amortization, Principal, Years One and Two			5.00%
Debt Instrument, Periodic Amortization, Principal, Years Three and Four			7.50%
Debt Instrument, Periodic Amortization, Principal, Year Five			10.00%
Loss on early extinguishment of debt	1,798,000	8,180,000											1,200,000
Debt transaction costs													400,000
Write off of deferred financing costs													800,000
Outstanding amount under credit facility						58,500,000			97,000,000
Outstanding amount of letters of credit											26,000,000
Availability under the revolving facility									67,000,000
Weighted-average interest rate under the term loan (in hundredths)						2.18%			2.18%						2.97%
Repayments of term loan under the credit facility						1,500,000								4,000,000
Interest rate cap, description of variable rate basis																LIBOR		LIBOR		LIBOR
Interest rate cap, basis spread on variable rate																	2.00%		2.00%		2.00%
Derivative, notional amount																	$ 150,000,000		$ 125,000,000		$ 150,000,000	$ 150,000,000	$ 140,000,000
Average fixed interest rate on interest rate swaps																						3.12%	3.12%

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Operating (Gains), Losses and Other Charges, Net (Tables)

9 Months Ended

Sep. 25, 2013

Operating (Gains), Losses And Other Charges, Net [Abstract]

Operating gains losses and other charges net

Operating (gains), losses and other charges, netare comprised of the following:

	Quarter Ended					Three Quarters Ended
	September 25, 2013			September 26, 2012		September 25, 2013			September 26, 2012
	(In thousands)
(Gains) losses on sales of assets and other, net	$	(68	)	$	91	$	(83	)	$	(6,772	)
Restructuring charges and exit costs	229			821		1,005			2,970
Impairment charges	—			2,468		857			3,008
Operating (gains), losses and other charges, net	$	161		$	3,380	$	1,779		$	(794	)

Schedule of restructuring charges and exit costs

Restructuring charges and exit costs were comprised of the following: 

	Quarter Ended				Three Quarters Ended
	September 25, 2013		September 26, 2012		September 25, 2013		September 26, 2012
	(In thousands)
Exit costs	$	198	$	233	$	435	$	1,139
Severance and other restructuring charges	31		588		570		1,831
Total restructuring and exit costs	$	229	$	821	$	1,005	$	2,970

Components of change in accrued exit cost liabilities

The components of the change in accrued exit cost liabilities are as follows:

	(In thousands)
Balance, December 26, 2012	$	4,061
Exit costs (1)	435
Payments, net of sublease receipts	(1,248		)
Interest accretion	195
Balance, September 25, 2013	3,443
Less current portion included in other current liabilities	1,228
Long-term portion included in other noncurrent liabilities	$	2,215

(1) Included as a component of operating (gains), losses and other charges, net.

Estimated net cash payments related to exit cost liabilities

Estimated net cash payments related to exit cost liabilities are as follows:

	(In thousands)
Remainder of 2013	$	270
2014	1,319
2015	545
2016	320
2017	322
Thereafter	1,338
Total	4,114
Less imputed interest	671
Present value of exit cost liabilities	$	3,443

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Goodwill and Other Intangible Assets (Tables)

9 Months Ended

Sep. 25, 2013

Goodwill and Intangible Assets Disclosure [Abstract]

Changes in carrying amounts of goodwill

The following table reflects the changes in carrying amounts of goodwill:

	(In thousands)
Balance, December 26, 2012	$	31,430
Additions related to acquisitions	28
Write-offs and reclassifications associated with sale of restaurants	(7		)
Balance, September 25, 2013	$	31,451

Intangible assets

ntangible assets were comprised of the following:

	September 25, 2013				December 26, 2012
	Gross Carrying Amount		Accumulated Amortization		Gross Carrying Amount		Accumulated Amortization
	(In thousands)
Intangible assets with indefinite lives:
Trade names	$	44,050	$	—	$	44,050	$	—
Liquor licenses	126		—		156		—
Intangible assets with definite lives:
Franchise and license agreements	32,993		28,733		37,524		32,863
Foreign license agreements	241		198		241		188
Intangible assets	$	77,410	$	28,931	$	81,971	$	33,051

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Receivables (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Sep. 25, 2013	Sep. 26, 2012	Sep. 25, 2013	Sep. 26, 2012	Dec. 26, 2012
Receivables [Abstract]
Trade accounts receivable from franchisees, gross, current	$ 9,228		$ 9,228		$ 10,212
Notes receivable from franchisees, gross, current	2,049		2,049		4,310
Allowance for doubtful accounts	(225)		(225)		(12)
Total current receivables, net	14,167		14,167		19,947
Noncurrent assets (included as a component of other noncurrent assets):
Notes receivable from franchisees, noncurrent	842		842		1,002
Maximum provision for credit losses	100	100	100	100
Maximum interest income on notes receivable	100	100	100	100
Vendor receivables [Member]
Receivables [Abstract]
Other receivable, gross, current	1,130		1,130		2,529
Credit card receivables [Member]
Receivables [Abstract]
Other receivable, gross, current	792		792		1,384
Other [Member]
Receivables [Abstract]
Other receivable, gross, current	$ 1,193		$ 1,193		$ 1,524

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Defined Benefit Plans (Details) (USD $)			3 Months Ended		9 Months Ended		3 Months Ended		9 Months Ended
	Sep. 25, 2013	Dec. 26, 2012	Sep. 25, 2013 Pension Plan [Member]	Sep. 26, 2012 Pension Plan [Member]	Sep. 25, 2013 Pension Plan [Member]	Sep. 26, 2012 Pension Plan [Member]	Sep. 25, 2013 Other Defined Benefit Plans [Member]	Sep. 26, 2012 Other Defined Benefit Plans [Member]	Sep. 25, 2013 Other Defined Benefit Plans [Member]	Sep. 26, 2012 Other Defined Benefit Plans [Member]
Components of net periodic benefit cost [Abstract]
Service cost			$ 100,000	$ 95,000	$ 300,000	$ 285,000
Interest cost			745,000	800,000	2,233,000	2,400,000	28,000	29,000	84,000	87,000
Expected return on plan assets			(1,122,000)	(1,024,000)	(3,366,000)	(3,042,000)
Amortization of net loss			413,000	441,000	1,240,000	1,322,000	17,000	13,000	53,000	39,000
Net periodic benefit cost			136,000	312,000	407,000	965,000	45,000	42,000	137,000	126,000
Contributions made to qualified pension plan and other defined benefit plans					2,800,000	2,800,000			100,000	100,000
Maximum expected additional contributions to be made to qualified pension plan and other defined benefit plans									100,000
Reclassification from accumulated other comprehensive income current period, net of tax					800,000
Additional minimum pension liability	$ 24,200,000	$ 25,000,000

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Share-Based Compensation (Tables)

9 Months Ended

Sep. 25, 2013

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Total share-based compensation

Total share-based compensation cost included as a component of net income was as follows:

	Quarter Ended				Three Quarters Ended
	September 25, 2013		September 26, 2012		September 25, 2013		September 26, 2012
	(In thousands)
Stock options	$	136	$	200	$	433	$	692
Restricted stock units	735		778		2,377		1,752
Board deferred stock units	182		150		624		350
Total share-based compensation	$	1,053	$	1,128	$	3,434	$	2,794

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Net Income Per Share (Details) (USD $) In Thousands, except Per Share data, unless otherwise specified	3 Months Ended		9 Months Ended
	Sep. 25, 2013	Sep. 26, 2012	Sep. 25, 2013	Sep. 26, 2012
Earnings Per Share [Abstract]
Net income	$ 7,031	$ 5,363	$ 20,310	$ 15,829
Weighted average shares outstanding - basic (in shares)	90,035	94,705	91,348	95,472
Effect of dilutive share-based compensation awards	1,932	2,040	2,029	1,724
Weighted average shares outstanding - diluted (in shares)	91,967	96,745	93,377	97,196
Basic net income per share	$ 0.08	$ 0.06	$ 0.22	$ 0.17
Diluted net income per share	$ 0.08	$ 0.06	$ 0.22	$ 0.16
Antidilutive securities excluded from diluted weighted-average shares outstanding (in shares)	331	116	331	1,902

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Receivables (Tables)

9 Months Ended

Sep. 25, 2013

Receivables [Abstract]

Receivables, net

Receivables were comprised of the following:

	September 25, 2013			December 26, 2012
	(In thousands)
Current assets:
Receivables:
Trade accounts receivable from franchisees	$	9,228		$	10,212
Notes receivable from franchisees	2,049			4,310
Vendor receivables	1,130			2,529
Credit card receivables	792			1,384
Other	1,193			1,524
Allowance for doubtful accounts	(225		)	(12		)
Total current receivables, net	$	14,167		$	19,947
Noncurrent assets (included as a component of other noncurrent assets):
Notes receivable from franchisees	$	842		$	1,002

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Condensed Consolidated Statement of Shareholders' Equity (Unaudited) (Parenthetical) (USD $) In Thousands, unless otherwise specified	9 Months Ended
	Sep. 25, 2013
Statement of Stockholders' Equity [Abstract]
Minimum pension liability adjustment, tax expense	$ 487
Unrealized gain on hedged transactions, tax expense	$ 1,063

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Introduction and Basis of Presentation

9 Months Ended

Sep. 25, 2013

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Introduction and Basis of Presentation

Introduction and Basis of Presentation

Denny’s Corporation, or Denny’s, is one of America’s largest full-service restaurant chains based on number of restaurants. The following table shows the unit activity for the quarter and three quarters endedSeptember 25, 2013 and September 26, 2012, respectively:

	Quarter Ended				Three Quarters Ended
	September 25, 2013		September 26, 2012		September 25, 2013		September 26, 2012
Company restaurants, beginning of period	165		177		164		206
Units opened	—		—		—		—
Units acquired from franchisees	1		—		2		—
Units sold to franchisees	(2	)	(5	)	(2	)	(28	)
Units closed	—		(1	)	—		(7	)
End of period	164		171		164		171
Franchised and licensed restaurants, beginning of period	1,525		1,507		1,524		1,479
Units opened	9		12		27		27
Units purchased from Company	2		5		2		28
Units acquired by Company	(1	)	—		(2	)	—
Units closed	(13	)	(8	)	(29	)	(18	)
End of period	1,522		1,516		1,522		1,516
Total restaurants, end of period	1,686		1,687		1,686		1,687

Our unaudited condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission. Therefore, certain information and notes normally included in financial statements prepared in accordance with U.S. generally accepted accounting principles have been condensed or omitted. In our opinion, all adjustments considered necessary for a fair presentation of the interim periods presented have been included. Such adjustments are of a normal and recurring nature. The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities. Actual results may differ from these estimates under different assumptions or conditions; however, we believe that our estimates, including those for the above-described items, are reasonable.

These interim condensed consolidated financial statements should be read in conjunction with our consolidated financial statements and notes thereto for the year ended December 26, 2012 and the related Management’s Discussion and Analysis of Financial Condition and Results of Operations, both of which are contained in our Annual Report on Form 10-K for the fiscal year ended December 26, 2012. The results of operations for the interim periods presented are not necessarily indicative of the results for the entire fiscal year ending December 25, 2013.

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Goodwill and Other Intangible Assets

9 Months Ended

Sep. 25, 2013

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and Other Intangible Assets

Goodwill and Other Intangible Assets

The following table reflects the changes in carrying amounts of goodwill:

	(In thousands)
Balance, December 26, 2012	$	31,430
Additions related to acquisitions	28
Write-offs and reclassifications associated with sale of restaurants	(7		)
Balance, September 25, 2013	$	31,451

Other intangible assets were comprised of the following:

	September 25, 2013				December 26, 2012
	Gross Carrying Amount		Accumulated Amortization		Gross Carrying Amount		Accumulated Amortization
	(In thousands)
Intangible assets with indefinite lives:
Trade names	$	44,050	$	—	$	44,050	$	—
Liquor licenses	126		—		156		—
Intangible assets with definite lives:
Franchise and license agreements	32,993		28,733		37,524		32,863
Foreign license agreements	241		198		241		188
Intangible assets	$	77,410	$	28,931	$	81,971	$	33,051

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Summary of Significant Accounting Policies

9 Months Ended

Sep. 25, 2013

Accounting Policies [Abstract]

Summary of Significant Accounting Policies

Summary of Significant Accounting Policies

Newly Adopted Accounting Standards

Intangibles

ASU No. 2012-02, "Intangibles—Goodwill and Other (Topic 350): Testing Indefinite-Lived Intangible Assets for Impairment”

Effective December 27, 2012, we adopted ASU 2012-02, which modifies the impairment test for indefinite-lived intangible assets. Under the new guidance, an entity is permitted to make a qualitative assessment of whether it is more likely than not that the indefinite-lived intangible asset is impaired. If it is determined through the qualitative assessment that the indefinite-lived intangible asset's fair value is more likely than not greater than its carrying value, the quantitative impairment calculations would not be required. The qualitative assessment is optional, allowing companies to go directly to the quantitative assessment. The adoption did not have any impact on our Condensed Consolidated Financial Statements.

Comprehensive Income 

ASU 2013-02, "Comprehensive Income (Topic 220): Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income"

Effective December 27, 2012, we adopted ASU 2013-02, which requires companies to provide information about the amounts reclassified out of accumulated other comprehensive income by component. In addition, companies are required to present, either on the face of the statement where net income is presented or in the notes, significant amounts reclassified out of accumulated other comprehensive income by the respective line items of net income. ASU 2013-02 is to be applied prospectively. The adoption concerns presentation and disclosure only and did not have an impact on our financial position or results of operations.

Accounting Standards to be Adopted

We reviewed all newly issued accounting pronouncements and concluded that they are either not applicable to our business or are not expected to have a material effect on the financial statements as a result of future adoption.

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Share-Based Compensation (Details) (USD $) Share data in Millions, except Per Share data, unless otherwise specified	1 Months Ended	3 Months Ended		9 Months Ended
	Jan. 31, 2013	Sep. 25, 2013	Sep. 26, 2012	Sep. 25, 2013	Sep. 26, 2012
Total share-based compensation [Abstract]
Total share-based compensation		$ 1,053,000	$ 1,128,000	$ 3,434,000	$ 2,794,000
Performance shares [Member]
Total share-based compensation [Abstract]
Total share-based compensation		735,000	778,000	2,377,000	1,752,000
Restricted Stock Units [Abstract]
Equity awards granted (in shares)	0.3
Employee performance based target cash awards	2,100,000
Equity awards, grant date fair value (in dollars per share)	$ 8.05
Performance period	3 years
Cash payments				900,000
Maximum common stock shares issued (in shares)				0.3
Unrecognized compensation cost [Abstract]
Unrecognized compensation cost related to all unvested restricted stock unit awards outstanding		5,000,000		5,000,000
Unrecognized compensation cost, expected weighted average period				1 year 4 months 28 days
Stock options [Member]
Total share-based compensation [Abstract]
Total share-based compensation		136,000	200,000	433,000	692,000
Unrecognized compensation cost [Abstract]
Unrecognized compensation cost related to unvested stock option awards outstanding		200,000		200,000
Unrecognized compensation cost, expected weighted average period				0 years 3 months 22 days
Restricted stock units [Member]
Total share-based compensation [Abstract]
Total share-based compensation		182,000	150,000	624,000	350,000
Restricted Stock Units [Abstract]
Equity awards granted (in shares)				0.1
Equity awards, grant date fair value (in dollars per share)				$ 5.95
Maximum common stock shares issued (in shares)				0.1
Unrecognized compensation cost [Abstract]
Unrecognized compensation cost related to all unvested restricted stock unit awards outstanding		$ 400,000		$ 400,000
Unrecognized compensation cost, expected weighted average period				0 years 7 months 0 days
Minimum [Member] | Performance shares [Member]
Restricted Stock Units [Abstract]
Minimum percentage of target awards to be earned (in hundredths)	0.00%
Maximum [Member] | Performance shares [Member]
Restricted Stock Units [Abstract]
Maximum percentage of target awards to be earned (in hundredths)	200.00%

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Fair Value of Financial Instruments (Tables)

9 Months Ended

Sep. 25, 2013

Fair Value Disclosures [Abstract]

Financial assets and liabilities measured at fair value on a recurring basis

Financial assets and liabilities measured at fair value on a recurring basis are summarized below:

	Total		Quoted Prices in Active Markets for Identical Assets/Liabilities (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Valuation Technique
	(In thousands)
Fair value measurements as of September 25, 2013:
Deferred compensation plan investments (1)	$	7,730	$	7,730	$	—	$	—	market approach
Interest rate swaps (2)	$	2,704	—		2,704		—		income approach
Interest rate caps (2)	$	25	$	—	$	25	$	—	income approach
Total	$	10,459	$	7,730	$	2,729	$	—
Fair value measurements as of December 26, 2012:
Deferred compensation plan investments (1)	$	6,371	$	6,371	$	—	$	—	market approach
Interest rate caps (2)	$	8	$	—	$	8	$	—	income approach
Total	$	6,379	$	6,371	$	8	$	—

(1) The fair values of our deferred compensation plan investments are based on the closing market prices of the participants’ elected investments.

(2) The fair values of our interest rate swaps and interest rate caps are based upon Level 2 inputs which include valuation models as reported by our counterparties. The key inputs for the valuation models are quoted market prices, interest rates and forward yield curves.

Assets and liabilities measured at fair value on a nonrecurring basis

Those assets and liabilities measured at fair value on a nonrecurring basis are summarized below:

	Total		Quoted Prices in Active Markets for Identical Assets/Liabilities (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Valuation Technique
	(In thousands)
Fair value measurements as of December 26, 2012:
Assets held and used (1)	$	228	$	—	$	—	$	228	income approach
Total	$	228	$	—	$	—	$	228

(1) As of December 26, 2012, impaired assets related to an underperforming restaurant were written down to their fair value. Impairment charges of $0.7 million were recognized as a component of operating (gains), losses and other charges, net in our Condensed Consolidated Statements of Comprehensive Income. To determine fair value, we used the income approach, which assumes that the future cash flows reflect current market expectations. These fair value measurements require significant judgment using Level 3 inputs, such as discounted cash flows from operations, which are not observable from the market, directly or indirectly.

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Supplemental Cash Flow Information (Tables)

9 Months Ended

Sep. 25, 2013

Supplemental Cash Flow Information [Abstract]

Supplemental Cash Flow Information

	Three Quarters Ended
	September 25, 2013		September 26, 2012
	(In thousands)
Income taxes paid, net	$	1,831	$	1,865
Interest paid	$	7,121	$	10,371
Noncash investing and financing activities:
Issuance of common stock, pursuant to share-based compensation plans	$	1,590	$	856
Execution of capital leases	$	4,038	$	1,581
Treasury stock payable	$	186	$	231

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Fair Value of Financial Instruments (Details) (USD $)	9 Months Ended		12 Months Ended
	Sep. 25, 2013		Dec. 26, 2012
Recurring [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total	$ 10,459,000		$ 6,379,000
Recurring [Member] | Quoted Prices in Active Markets for Identical Assets/Liabilities (Level 1) [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total	7,730,000		6,371,000
Recurring [Member] | Significant Other Observable Inputs (Level 2) [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total	2,729,000		8,000
Recurring [Member] | Significant Unobservable Inputs (Level 3) [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total	0		0
Recurring [Member] | Deferred compensation plan investments [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Deferred compensation plan investments	7,730,000	[1]	6,371,000	[1]
Valuation technique	market approach		market approach
Recurring [Member] | Deferred compensation plan investments [Member] | Quoted Prices in Active Markets for Identical Assets/Liabilities (Level 1) [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Deferred compensation plan investments	7,730,000	[1]	6,371,000	[1]
Recurring [Member] | Deferred compensation plan investments [Member] | Significant Other Observable Inputs (Level 2) [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Deferred compensation plan investments	0	[1]	0	[1]
Recurring [Member] | Deferred compensation plan investments [Member] | Significant Unobservable Inputs (Level 3) [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Deferred compensation plan investments	0	[1]	0	[1]
Recurring [Member] | Interest rate swaps [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Interest rate swaps and interest rate caps	2,704,000	[2]
Valuation technique	income approach
Recurring [Member] | Interest rate swaps [Member] | Quoted Prices in Active Markets for Identical Assets/Liabilities (Level 1) [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Interest rate swaps and interest rate caps	0	[2]
Recurring [Member] | Interest rate swaps [Member] | Significant Other Observable Inputs (Level 2) [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Interest rate swaps and interest rate caps	2,704,000	[2]
Recurring [Member] | Interest rate swaps [Member] | Significant Unobservable Inputs (Level 3) [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Interest rate swaps and interest rate caps	0	[2]
Recurring [Member] | Interest rate caps [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Interest rate swaps and interest rate caps	25,000	[2]	8,000	[2]
Valuation technique	income approach		income approach
Recurring [Member] | Interest rate caps [Member] | Quoted Prices in Active Markets for Identical Assets/Liabilities (Level 1) [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Interest rate swaps and interest rate caps	0	[2]	0	[2]
Recurring [Member] | Interest rate caps [Member] | Significant Other Observable Inputs (Level 2) [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Interest rate swaps and interest rate caps	25,000	[2]	8,000	[2]
Recurring [Member] | Interest rate caps [Member] | Significant Unobservable Inputs (Level 3) [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Interest rate swaps and interest rate caps	0	[2]	0	[2]
Nonrecurring [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total			228,000
Nonrecurring [Member] | Quoted Prices in Active Markets for Identical Assets/Liabilities (Level 1) [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total			0
Nonrecurring [Member] | Significant Other Observable Inputs (Level 2) [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total			0
Nonrecurring [Member] | Significant Unobservable Inputs (Level 3) [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total			228,000
Nonrecurring [Member] | Assets held and used [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets held and used			228,000	[3]
Valuation technique			income approach
Impairment of Long-Lived Assets Held-for-use			700,000
Nonrecurring [Member] | Assets held and used [Member] | Quoted Prices in Active Markets for Identical Assets/Liabilities (Level 1) [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets held and used			0	[3]
Nonrecurring [Member] | Assets held and used [Member] | Significant Other Observable Inputs (Level 2) [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets held and used			0	[3]
Nonrecurring [Member] | Assets held and used [Member] | Significant Unobservable Inputs (Level 3) [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets held and used			$ 228,000	[3]

[1] The fair values of our deferred compensation plan investments are based on the closing market prices of the participants’ elected investments.

[2] The fair values of our interest rate swaps and interest rate caps are based upon Level 2 inputs which include valuation models as reported by our counterparties. The key inputs for the valuation models are quoted market prices, interest rates and forward yield curves.

[3] As of December 26, 2012, impaired assets related to an underperforming restaurant were written down to their fair value. Impairment charges of $0.7 million were recognized as a component of operating (gains), losses and other charges, net in our Condensed Consolidated Statements of Comprehensive Income. To determine fair value, we used the income approach, which assumes that the future cash flows reflect current market expectations. These fair value measurements require significant judgment using Level 3 inputs, such as discounted cash flows from operations, which are not observable from the market, directly or indirectly.

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Share Repurchase (Details) (USD $)	9 Months Ended
	Sep. 25, 2013
Equity, Class of Treasury Stock [Line Items]
Purchase of treasury stock (in shares)	3,800,000
Purchase of treasury stock	$ 21,578,000
Share Repurchase Program 2012 [Member]
Equity, Class of Treasury Stock [Line Items]
Additional number of shares approved under stock repurchase program (in shares)	6,000,000
Number of accumulated shares repurchased (in shares)	6,000,000
Value of shares repurchased	31,900,000
Share Repurchase Program 2013 [Member]
Equity, Class of Treasury Stock [Line Items]
Additional number of shares approved under stock repurchase program (in shares)	10,000,000
Number of accumulated shares repurchased (in shares)	300,000
Value of shares repurchased	$ 1,900,000
Remaining number of shares approved under stock repurchase program (in shares)	9,700,000

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Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) (USD $) In Thousands, except Per Share data, unless otherwise specified	Sep. 25, 2013	Dec. 26, 2012
Assets [Abstract]
Accumulated depreciation	$ 251,617	$ 250,173
Shareholders' equity
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, shares authorized	135,000	135,000
Common stock, shares issued	104,695	103,764
Common stock, shares outstanding	89,372	92,229
Treasury stock, at cost, shares	15,323	11,535

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Long-Term Debt

9 Months Ended

Sep. 25, 2013

Debt Disclosure [Abstract]

Long-Term Debt

Long-Term Debt

Refinancing of Credit Facility

On April 24, 2013, Denny's Corporation and certain of its subsidiaries refinanced our credit facility (the "Old Credit Facility") and entered into a new senior secured credit agreement in an aggregate principal amount of $250 million (the “New Credit Facility”). The New Credit Facility is comprised of a $60 million senior secured term loan and a $190 million senior secured revolver (with a $30 million letter of credit sublimit). A commitment fee of 0.35% is paid on the unused portion of the revolving credit facility. Borrowings under the New Credit Facility bear a tiered interest rate based on the Company's consolidated leverage ratio and is initially set at LIBOR plus 200 basis points. The New Credit Facility includes an accordion feature that would allow us to increase the size of the facility to $300 million. The maturity date for the New Credit Facility is April 24, 2018.

The New Credit Facility was used to refinance the Old Credit Facility and will be available for working capital, capital expenditures and other general corporate purposes. The New Credit Facility is guaranteed by the Company and its material subsidiaries and is secured by substantially all of the assets of the Company and its subsidiaries, including the stock of the Company's subsidiaries. It includes negative covenants that are usual for facilities and transactions of this type. The New Credit Facility also includes certain financial covenants with respect to a maximum consolidated leverage ratio, a minimum consolidated fixed charge coverage ratio and maximum capital expenditures.

The term loan under the New Credit Facility requires amortization of the original term loan balance of 5% per year in the first two years, 7.5% in the subsequent two years and 10% in the fifth year with the balance due at maturity. We will be required to make certain mandatory prepayments under certain circumstances and will have the option to make certain prepayments under the New Credit Facility. The New Credit Facility includes events of default (and related remedies, including acceleration and increased interest rates following an event of default) that are usual for facilities and transactions of this type.

As a result of the debt refinancing, we recorded $1.2 million of losses on early extinguishment of debt, consisting primarily of $0.4 million of transaction costs and $0.8 million from the write-off of deferred financing costs related to the Old Credit Facility. These losses are included as a component of other nonoperating expense in the condensed Consolidated Statements of Comprehensive Income.

As of September 25, 2013, we had outstanding term loan borrowings under the New Credit Facility of $58.5 million and outstanding letters of credit under the senior secured revolver of $26.0 million. There were $97.0 million of revolving loans outstanding at September 25, 2013. These balances resulted in availability of $67.0 million under the revolving facility. The weighted-average interest rate under the term loan was 2.18% and 2.97% as of September 25, 2013 and December 26, 2012, respectively. The weighted-average interest rate on outstanding revolver loans was 2.18% as of September 25, 2013.

During the three quarters ended September 25, 2013, we paid $4.0 million on the term loan under the Old Credit Facility, prior to the April 24, 2013 refinancing. Subsequent to the April 24, 2013 refinancing, we paid $1.5 million on the term loan under the New Credit Facility.

Aggregate annual maturities of long-term debt, excluding capital lease obligations, at September 25, 2013 are as follows:

	(In thousands)
Remainder of 2013	$	750
2014	3,000
2015	4,125
2016	4,500
2017 and thereafter	143,125
Total long-term debt, excluding capital lease obligations	$	155,500

Interest Rate Hedges

On April 13, 2012, we entered into interest rate hedges that cap the LIBOR rate on borrowings under our credit facility for a two year period. The 200 basis point LIBOR cap applied to $150 million of borrowings from April 13, 2012 through April 13, 2013 and $125 million of borrowings from April 14, 2013 through April 13, 2014.

Our existing interest rate hedges remain in effect under the New Credit Facility until April 13, 2014. On April 30, 2013, we entered into additional interest rate hedges that cap the LIBOR rate on borrowings under the New Credit Facility. The 200 basis point LIBOR cap applies to $150 million of borrowings from April 14, 2014 through March 31, 2015.

On April 30, 2013, we also entered into interest rate swaps to hedge a portion of the cash flows of our floating rate debt from March 31, 2015 through March 29, 2018. We designated the interest rate swaps as cash flow hedges of our exposure to variability in future cash flows attributable to payments of LIBOR due on a related $150 million notional debt obligation from March 31, 2015 through March 31, 2017 and a related $140 million notional debt obligation from April 1, 2017 through March 29, 2018. Under the terms of the swaps, we will pay an average fixed rate of 3.12% on the notional amounts and receive payments from a counterparty based on the 30-day LIBOR rate.

We believe that our estimated cash flows from operations for 2013, combined with our capacity for additional borrowings under our credit facility, will enable us to meet our anticipated cash requirements and fund capital expenditures over the next twelve months.

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Condensed Consolidated Statement of Shareholders' Equity (Unaudited) (USD $) In Thousands, unless otherwise specified	Total	Common Stock [Member]	Treasury Stock [Member]	Paid-in Capital [Member]	(Deficit) [Member]	Accumulated Other Comprehensive Loss, Net [Member]
Balance at Dec. 26, 2012	$ (4,460)	$ 1,038	$ (47,638)	$ 562,657	$ (495,518)	$ (24,999)
Balance, treasury stock, at cost, shares at Dec. 26, 2012	(11,535)		(11,535)
Balance, common stock, shares issued at Dec. 26, 2012	103,764	103,764
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	20,310				20,310
Recognition of unrealized gain on hedged transactions, net of tax expense of $1,063	1,640					1,640
Minimum pension liability adjustment, net of tax expense of $487	752					752
Share-based compensation on equity classified awards	1,848			1,848
Purchase of treasury stock	(21,578)		(21,578)
Purchase of treasury stock (in shares)	(3,800)		(3,788)
Issuance of common stock for share-based compensation	0	3		(3)
Issuance of common stock for share-based compensation (in shares)		300
Exercise of common stock options	2,077	6		2,071
Exercise of common stock options (in shares)		631
Tax expense from stock options exercised	(204)			(204)
Balance at Sep. 25, 2013	$ 385	$ 1,047	$ (69,216)	$ 566,369	$ (475,208)	$ (22,607)
Balance, treasury stock, at cost, shares at Sep. 25, 2013	(15,323)		(15,323)
Balance, common stock, shares issued at Sep. 25, 2013	104,695	104,695

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Condensed Consolidated Balance Sheets (Unaudited) (USD $) In Thousands, unless otherwise specified	Sep. 25, 2013	Dec. 26, 2012
Current assets:
Cash and cash equivalents	$ 6,330	$ 13,565
Receivables	14,167	19,947
Inventories	2,890	2,890
Current deferred tax asset	20,962	19,807
Prepaid and other current assets	6,111	8,401
Total current assets	50,460	64,610
Property, net of accumulated depreciation of $251,617 and $250,173, respectively	105,174	107,004
Goodwill	31,451	31,430
Intangible assets, net	48,479	48,920
Deferred financing costs, net	2,216	2,041
Noncurrent deferred tax asset	34,829	45,776
Other noncurrent assets	27,300	25,104
Total assets	299,909	324,885
Current liabilities:
Current maturities of long-term debt	3,000	8,500
Current maturities of capital lease obligations	4,170	4,181
Accounts payable	17,009	24,461
Other current liabilities	50,228	54,682
Total current liabilities	74,407	91,824
Long-term liabilities:
Long-term debt, less current maturities	152,500	161,500
Capital lease obligations, less current maturities	15,666	15,953
Liability for insurance claims, less current portion	18,104	18,045
Other noncurrent liabilities and deferred credits	38,847	42,023
Total long-term liabilities	225,117	237,521
Total liabilities	299,524	329,345
Commitments and Contingencies
Shareholders' equity
Common stock $0.01 par value; authorized - 135,000; September 25, 2013: 104,695 shares issued and 89,372 shares outstanding; December 26, 2012: 103,764 shares issued and 92,229 shares outstanding	1,047	1,038
Paid-in capital	566,369	562,657
Deficit	(475,208)	(495,518)
Accumulated other comprehensive loss, net of tax	(22,607)	(24,999)
Shareholders' equity before treasury stock	69,601	43,178
Treasury stock, at cost, 15,323 and 11,535 shares, respectively	(69,216)	(47,638)
Total shareholders' equity (deficit)	385	(4,460)
Total liabilities and shareholders' equity	$ 299,909	$ 324,885

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Long-Term Debt Long Term Debt (Tables)

9 Months Ended

Sep. 25, 2013

Debt Disclosure [Abstract]

Aggregate annual maturities of long-term debt, excluding capital lease obligations

Aggregate annual maturities of long-term debt, excluding capital lease obligations, at September 25, 2013 are as follows:

	(In thousands)
Remainder of 2013	$	750
2014	3,000
2015	4,125
2016	4,500
2017 and thereafter	143,125
Total long-term debt, excluding capital lease obligations	$	155,500

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Summary of Significant Accounting Policies (Policies)

9 Months Ended

Sep. 25, 2013

Accounting Policies [Abstract]

Newly Adopted Accounting Standards

Newly Adopted Accounting Standards

Intangibles

ASU No. 2012-02, "Intangibles—Goodwill and Other (Topic 350): Testing Indefinite-Lived Intangible Assets for Impairment”

Effective December 27, 2012, we adopted ASU 2012-02, which modifies the impairment test for indefinite-lived intangible assets. Under the new guidance, an entity is permitted to make a qualitative assessment of whether it is more likely than not that the indefinite-lived intangible asset is impaired. If it is determined through the qualitative assessment that the indefinite-lived intangible asset's fair value is more likely than not greater than its carrying value, the quantitative impairment calculations would not be required. The qualitative assessment is optional, allowing companies to go directly to the quantitative assessment. The adoption did not have any impact on our Condensed Consolidated Financial Statements.

Comprehensive Income 

ASU 2013-02, "Comprehensive Income (Topic 220): Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income"

Effective December 27, 2012, we adopted ASU 2013-02, which requires companies to provide information about the amounts reclassified out of accumulated other comprehensive income by component. In addition, companies are required to present, either on the face of the statement where net income is presented or in the notes, significant amounts reclassified out of accumulated other comprehensive income by the respective line items of net income. ASU 2013-02 is to be applied prospectively. The adoption concerns presentation and disclosure only and did not have an impact on our financial position or results of operations.

Accounting Standards to be Adopted

Accounting Standards to be Adopted

We reviewed all newly issued accounting pronouncements and concluded that they are either not applicable to our business or are not expected to have a material effect on the financial statements as a result of future adoption.

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Supplemental Cash Flow Information (Details) (USD $) In Thousands, unless otherwise specified	9 Months Ended
	Sep. 25, 2013	Sep. 26, 2012
Supplemental Cash Flow Information [Abstract]
Income taxes paid, net	$ 1,831	$ 1,865
Interest paid	7,121	10,371
Noncash investing and financing activities:
Issuance of common stock, pursuant to share-based compensation plans	1,590	856
Execution of capital leases	4,038	1,581
Treasury stock payable	$ 186	$ 231

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Long-Term Debt Long-Term Debt (Aggregate Maturities of Long-Term Debt, Excluding Capital Lease Obligations) (Details) (USD $) In Thousands, unless otherwise specified	Sep. 25, 2013
Aggregate annual maturities of long-term debt, excluding capital lease obligations [Abstract]
Remainder of 2013	$ 750
2014	3,000
2015	4,125
2016	4,500
2017 and thereafter	143,125
Total long-term debt, excluding capital lease oblgiations	$ 155,500

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Goodwill and Other Intangible Assets (Details) (USD $) In Thousands, unless otherwise specified	9 Months Ended
	Sep. 25, 2013	Dec. 26, 2012
Goodwill [Roll Forward]
Balance, December 26, 2012	$ 31,430
Additions related to acquisitions	28
Write-offs and reclassification associated with sale of restaurants	(7)
Balance, September 25, 2013	31,451
Goodwill and Intangible Assets [Line Items]
Goodwill	31,451
Intangible assets	77,410	81,971
Intangible assets with indefinite lives [Abstract]
Gross carrying amount - Trade names	44,050	44,050
Gross carrying amount - Liquor licenses	126	156
Intangible assets with definite lives [Abstract]
Accumulated amortization	28,931	33,051
Franchise and license agreements [Member]
Intangible assets with definite lives [Abstract]
Gross carrying amount	32,993	37,524
Accumulated amortization	28,733	32,863
Foreign license agreements [Member]
Intangible assets with definite lives [Abstract]
Gross carrying amount	241	241
Accumulated amortization	$ 198	$ 188

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Operating (Gains), Losses and Other Charges, Net (Details) (USD $)	3 Months Ended		9 Months Ended
	Sep. 25, 2013	Sep. 26, 2012	Sep. 25, 2013		Sep. 26, 2012	Dec. 26, 2012
Operating (gains), losses and other charges, net [Abstract]
(Gains) losses on sales of assets and other, net	$ (68,000)	$ 91,000	$ (83,000)		$ (6,772,000)
Restructuring charges and exit costs	229,000	821,000	1,005,000		2,970,000
Impairment charges	0	2,468,000	857,000		3,008,000
Operating (gains), losses and other charges, net	161,000	3,380,000	1,779,000		(794,000)
Restructuring charges and exit costs [Abstract]
Exit costs	198,000	233,000	435,000	[1]	1,139,000
Severance and other restructuring charges	31,000	588,000	570,000		1,831,000
Total restructuring charges and exit costs	229,000	821,000	1,005,000		2,970,000
Components of change in accrued exit cost liabilities [Roll Forward]
Balance at December 26, 2012			4,061,000
Exit costs	198,000	233,000	435,000	[1]	1,139,000
Payments, net of sublease receipts			(1,248,000)
Interest accretion			195,000
Balance, September 25, 2013	3,443,000		3,443,000
Less current portion included in other current liabilities	1,228,000		1,228,000
Long-term portion included in other noncurrent liabilities	2,215,000		2,215,000
Estimated net cash payments related to exit cost liabilities [Abstract]
Remainder of 2013	270,000		270,000
2014	1,319,000		1,319,000
2015	545,000		545,000
2016	320,000		320,000
2017	322,000		322,000
Thereafter	1,338,000		1,338,000
Total	4,114,000		4,114,000
Less imputed interest	671,000		671,000
Present value of exit cost liabilities	3,443,000		3,443,000
Accrued severance and other restructuring charges	100,000		100,000			500,000
Period of accrued severance and other restructuring charges, maximum			12 months
Impairment charges	$ 0	$ 2,468,000	$ 857,000		$ 3,008,000

[1] (1)Included as a component of operating (gains), losses and other charges, net.

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Fair Value of Financial Instruments

9 Months Ended

Sep. 25, 2013

Fair Value Disclosures [Abstract]

Fair Value Disclosures

Fair Value of Financial Instruments

Fair Value of Assets and Liabilities Measured on a Recurring and Nonrecurring Basis

Financial assets and liabilities measured at fair value on a recurring basis are summarized below:

	Total		Quoted Prices in Active Markets for Identical Assets/Liabilities (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Valuation Technique
	(In thousands)
Fair value measurements as of September 25, 2013:
Deferred compensation plan investments (1)	$	7,730	$	7,730	$	—	$	—	market approach
Interest rate swaps (2)	$	2,704	—		2,704		—		income approach
Interest rate caps (2)	$	25	$	—	$	25	$	—	income approach
Total	$	10,459	$	7,730	$	2,729	$	—
Fair value measurements as of December 26, 2012:
Deferred compensation plan investments (1)	$	6,371	$	6,371	$	—	$	—	market approach
Interest rate caps (2)	$	8	$	—	$	8	$	—	income approach
Total	$	6,379	$	6,371	$	8	$	—

(1) The fair values of our deferred compensation plan investments are based on the closing market prices of the participants’ elected investments.

(2) The fair values of our interest rate swaps and interest rate caps are based upon Level 2 inputs which include valuation models as reported by our counterparties. The key inputs for the valuation models are quoted market prices, interest rates and forward yield curves.

Those assets and liabilities measured at fair value on a nonrecurring basis are summarized below:

	Total		Quoted Prices in Active Markets for Identical Assets/Liabilities (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Valuation Technique
	(In thousands)
Fair value measurements as of December 26, 2012:
Assets held and used (1)	$	228	$	—	$	—	$	228	income approach
Total	$	228	$	—	$	—	$	228

(1) As of December 26, 2012, impaired assets related to an underperforming restaurant were written down to their fair value. Impairment charges of $0.7 million were recognized as a component of operating (gains), losses and other charges, net in our Condensed Consolidated Statements of Comprehensive Income. To determine fair value, we used the income approach, which assumes that the future cash flows reflect current market expectations. These fair value measurements require significant judgment using Level 3 inputs, such as discounted cash flows from operations, which are not observable from the market, directly or indirectly.

Disclosures of Fair Value of Other Assets and Liabilities

The liabilities under our credit facility are carried at historical cost in our Condensed Consolidated Balance Sheets. As of September 25, 2013 and December 26, 2012, the estimated fair value (Level 2) of our senior secured term loan approximated its carrying value. The fair value of our long-term debt is determined based on market prices or, if market prices are not available, the present value of the underlying cash flows discounted at market rates.

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Defined Benefit Plans (Tables)

9 Months Ended

Sep. 25, 2013

Compensation and Retirement Disclosure [Abstract]

Components of net periodic benefit cost

The components of net periodic benefit cost were as follows:

	Quarter Ended						Three Quarters Ended
	September 25, 2013			September 26, 2012			September 25, 2013			September 26, 2012
	(In thousands)
Pension plan:
Service cost	$	100		$	95		$	300		$	285
Interest cost	745			800			2,233			2,400
Expected return on plan assets	(1,122		)	(1,024		)	(3,366		)	(3,042		)
Amortization of net loss	413			441			1,240			1,322
Net periodic benefit cost	$	136		$	312		$	407		$	965
Other defined benefit plans:
Interest cost	$	28		$	29		$	84		$	87
Amortization of net loss	17			13			53			39
Net periodic benefit cost	$	45		$	42		$	137		$	126

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Income Taxes (Details) (USD $)	3 Months Ended		9 Months Ended
	Sep. 25, 2013	Sep. 26, 2012	Sep. 25, 2013	Sep. 26, 2012
Income Tax Disclosure [Abstract]
Provision for income taxes	$ 4,318,000	$ 3,201,000	$ 10,424,000	$ 10,295,000
Deferred tax benefit			300,000
State jobs tax credits			800,000
Valuation allowance recorded against certain state jobs tax credits			$ 500,000

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Share-Based Compensation

9 Months Ended

Sep. 25, 2013

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Share-Based Compensation

Share-Based Compensation

Total share-based compensation cost included as a component of net income was as follows:

	Quarter Ended				Three Quarters Ended
	September 25, 2013		September 26, 2012		September 25, 2013		September 26, 2012
	(In thousands)
Stock options	$	136	$	200	$	433	$	692
Restricted stock units	735		778		2,377		1,752
Board deferred stock units	182		150		624		350
Total share-based compensation	$	1,053	$	1,128	$	3,434	$	2,794

Stock Options

As of September 25, 2013, we had approximately $0.2 million of unrecognized compensation cost related to unvested stock option awards outstanding, which is expected to be recognized over a weighted average of 0.3 years.

Restricted Stock Units

In January 2013, we granted approximately 0.3 million performance shares and related performance-based target cash awards of $2.1 million to certain employees. As these awards contain a market condition, a Monte Carlo valuation was used to determine the performance shares' grant date fair value of $8.05 per share and the payout probability of the target cash awards. The awards granted to our named executive officers also contain a performance condition based on certain operating measures for the fiscal year ended December 25, 2013. The performance period is the three year fiscal period beginning December 27, 2012 and ending December 30, 2015. The performance shares and cash awards will vest and be earned (from 0% to 200% of the target award for each such increment) at the end of the performance period based on the total shareholder return of our stock compared to the total shareholder returns of a group of peer companies.

During the three quarters ended September 25, 2013, we made payments of $0.9 million in cash and issued 0.3 million shares of common stock related to restricted stock unit awards.

As of September 25, 2013, we had approximately $5.0 million of unrecognized compensation cost related to all unvested restricted stock unit awards outstanding, which is expected to be recognized over a weighted average of 1.4 years.

Board Deferred Stock Units

During the three quarters ended September 25, 2013, we granted approximately 0.1 million deferred stock units (which are equity classified) with a weighted average grant date fair value of $5.95 per unit to non-employee members of our Board of Directors. A director may elect to convert these awards into shares of common stock either on a specific date in the future (while still serving as a member of the Board of Directors) or upon termination as a member of the Board of Directors. During the three quarters ended September 25, 2013, less than 0.1 million deferred stock units were converted into shares of common stock. As of September 25, 2013, we had approximately $0.4 million of unrecognized compensation cost related to all unvested deferred stock unit awards outstanding, which is expected to be recognized over a weighted average of 0.6 years.

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Operating (Gains), Losses and Other Charges, Net

9 Months Ended

Sep. 25, 2013

Operating (Gains), Losses And Other Charges, Net [Abstract]

Operating (Gains), Losses and Other Charges, Net

Operating (Gains), Losses and Other Charges, Net

Operating (gains), losses and other charges, netare comprised of the following:

	Quarter Ended					Three Quarters Ended
	September 25, 2013			September 26, 2012		September 25, 2013			September 26, 2012
	(In thousands)
(Gains) losses on sales of assets and other, net	$	(68	)	$	91	$	(83	)	$	(6,772	)
Restructuring charges and exit costs	229			821		1,005			2,970
Impairment charges	—			2,468		857			3,008
Operating (gains), losses and other charges, net	$	161		$	3,380	$	1,779		$	(794	)

Restructuring Charges and Exit Costs

Restructuring charges and exit costs were comprised of the following: 

	Quarter Ended				Three Quarters Ended
	September 25, 2013		September 26, 2012		September 25, 2013		September 26, 2012
	(In thousands)
Exit costs	$	198	$	233	$	435	$	1,139
Severance and other restructuring charges	31		588		570		1,831
Total restructuring and exit costs	$	229	$	821	$	1,005	$	2,970

The components of the change in accrued exit cost liabilities are as follows:

	(In thousands)
Balance, December 26, 2012	$	4,061
Exit costs (1)	435
Payments, net of sublease receipts	(1,248		)
Interest accretion	195
Balance, September 25, 2013	3,443
Less current portion included in other current liabilities	1,228
Long-term portion included in other noncurrent liabilities	$	2,215

(1) Included as a component of operating (gains), losses and other charges, net.

Estimated net cash payments related to exit cost liabilities are as follows:

	(In thousands)
Remainder of 2013	$	270
2014	1,319
2015	545
2016	320
2017	322
Thereafter	1,338
Total	4,114
Less imputed interest	671
Present value of exit cost liabilities	$	3,443

As of September 25, 2013 and December 26, 2012, we had accrued severance and other restructuring charges of $0.1 million and $0.5 million, respectively. The balance as of September 25, 2013 is expected to be paid during the next 12 months.

Impairment charges of $0.9 million for the three quarters ended September 25, 2013 resulted primarily from the impairment of two units identified as assets held for sale. Impairment charges of $2.5 million for the quarter ended September 26, 2012 resulted primarily from the impairment of six units identified as held for sale. Impairment charges of $3.0 million for the three quarters ended September 26, 2012 resulted primarily from the impairment of seven units identified as assets held for sale and the impairment of an underperforming unit.

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Consolidated Statements of Cash Flows (Unaudited) (USD $) In Thousands, unless otherwise specified	9 Months Ended
	Sep. 25, 2013	Sep. 26, 2012
Cash flows from operating activities:
Net income	$ 20,310	$ 15,829
Adjustments to reconcile net income to cash flows provided by operating activities:
Depreciation and amortization	15,774	17,174
Operating (gains), losses and other charges, net	1,779	(794)
Amortization of deferred financing costs	376	639
Amortization of debt discount	0	137
Loss on early extinguishment of debt	1,798	8,180
Loss on change in the fair value of interest rate caps	28	62
Deferred income tax expense	8,241	8,988
Share-based compensation	3,434	2,794
Decrease (increase) in assets:
Receivables	3,519	1,034
Inventories	0	592
Other current assets	2,291	3,885
Other assets	(1,399)	(2,549)
Increase (decrease) in liabilities:
Accounts payable	(3,461)	(4,548)
Accrued salaries and vacations	(3,089)	1,246
Accrued taxes	1,823	1,140
Other accrued liabilities	(4,015)	(5,725)
Other noncurrent liabilities and deferred credits	(2,693)	(4,061)
Net cash flows provided by operating activities	44,716	44,023
Cash flows from investing activities:
Capital expenditures	(11,819)	(7,846)
Acquisition of restaurant	(1,622)	0
Proceeds from disposition of property	1,591	14,168
Collections on notes receivable	3,653	1,642
Issuance of notes receivable	(1,232)	(1,652)
Net cash flows (used in) provided by investing activities	(9,429)	6,312
Cash flows from financing activities:
Net revolver borrowings under new credit agreement	97,000	0
Term loan borrowings under new credit agreement	60,000	190,000
Long-term debt payments	(174,820)	(215,590)
Proceeds from exercise of stock options	2,077	2,123
Tax withholding on share-based payments	(464)	(327)
Tax (expense) benefit of stock options exercised	(204)	648
Debt transaction costs	(366)	(1,098)
Deferred financing costs	(1,372)	(1,809)
Purchase of treasury stock	(21,952)	(10,442)
Net bank overdrafts	(2,421)	(3,432)
Net cash flows used in financing activities	(42,522)	(39,927)
(Decrease) increase in cash and cash equivalents	(7,235)	10,408
Cash and cash equivalents at beginning of period	13,565	13,740
Cash and cash equivalents at end of period	$ 6,330	$ 24,148

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Introduction and Basis of Presentation (Details)	3 Months Ended		9 Months Ended
	Sep. 25, 2013 restaurant	Sep. 26, 2012 restaurant	Sep. 25, 2013 restaurant	Sep. 26, 2012 restaurant
Entity and franchisee unit activity [Roll Forward]
Units, end of period	1,686	1,687	1,686	1,687
Company restaurants [Member]
Entity and franchisee unit activity [Roll Forward]
Units, beginning of period	165	177	164	206
Units opened	0	0	0	0
Units acquired from franchisees	1	0	2	0
Units sold to franchisees	(2)	(5)	(2)	(28)
Units closed	0	(1)	0	(7)
Units, end of period	164	171	164	171
Franchised and licensed restaurants [Member]
Entity and franchisee unit activity [Roll Forward]
Units, beginning of period	1,525	1,507	1,524	1,479
Units opened	9	12	27	27
Units purchased from Company	2	5	2	28
Units acquired by Company	(1)	0	(2)	0
Units closed	(13)	(8)	(29)	(18)
Units, end of period	1,522	1,516	1,522	1,516

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Supplemental Cash Flow Information

9 Months Ended

Sep. 25, 2013

Supplemental Cash Flow Information [Abstract]

Supplemental Cash Flow Information

Supplemental Cash Flow Information

	Three Quarters Ended
	September 25, 2013		September 26, 2012
	(In thousands)
Income taxes paid, net	$	1,831	$	1,865
Interest paid	$	7,121	$	10,371
Noncash investing and financing activities:
Issuance of common stock, pursuant to share-based compensation plans	$	1,590	$	856
Execution of capital leases	$	4,038	$	1,581
Treasury stock payable	$	186	$	231

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Defined Benefit Plans

9 Months Ended

Sep. 25, 2013

Compensation and Retirement Disclosure [Abstract]

Defined Benefit Plans

Defined Benefit Plans

The components of net periodic benefit cost were as follows:

	Quarter Ended						Three Quarters Ended
	September 25, 2013			September 26, 2012			September 25, 2013			September 26, 2012
	(In thousands)
Pension plan:
Service cost	$	100		$	95		$	300		$	285
Interest cost	745			800			2,233			2,400
Expected return on plan assets	(1,122		)	(1,024		)	(3,366		)	(3,042		)
Amortization of net loss	413			441			1,240			1,322
Net periodic benefit cost	$	136		$	312		$	407		$	965
Other defined benefit plans:
Interest cost	$	28		$	29		$	84		$	87
Amortization of net loss	17			13			53			39
Net periodic benefit cost	$	45		$	42		$	137		$	126

We made contributions of $2.8 million to our qualified pension plan during both the three quarters ended September 25, 2013 and September 26, 2012. We made contributions of $0.1 million to our other defined benefit plans during both the three quarters ended September 25, 2013 and September 26, 2012. We expect to contribute less than $0.1 million to our other defined benefit plans over the remainder of fiscal 2013.

During the three quarters ended September 25, 2013, we amortized $0.8 million of actuarial losses, net of tax, out of accumulated other comprehensive loss into net periodic benefit cost, which is reported as a component of general and administrative expenses in the Condensed Consolidated Statement of Comprehensive Income. Additional minimum pension liability of $24.2 million and $25.0 million is reported as a component of accumulated other comprehensive loss in the Condensed Consolidated Statement of Shareholders’ Equity as of September 25, 2013 and December 26, 2012, respectively.

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Subsequent Events (Notes)

9 Months Ended

Sep. 25, 2013

Subsequent Events [Abstract]

Subsequent Events [Text Block]

Subsequent Events

We performed an evaluation of subsequent events and determined that no events required disclosure.

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Share Repurchase

9 Months Ended

Sep. 25, 2013

Share Repurchase [Abstract]

Share Repurchase

Share Repurchase

Our Old Credit Facility (as defined in Note 7) permitted and our New Credit Facility (as defined in Note 7) permits the payment of cash dividends and the purchase of Denny’s stock subject to certain limitations. In May 2012, we announced that our Board of Directors approved a share repurchase program authorizing us to repurchase up to an additional 6.0 million shares of our Common Stock (in addition to prior authorizations). Under this program, we may, from time to time, purchase shares in the open market (including pre-arranged stock trading plans in accordance with the guidelines specified in Rule 10b5-1 under the Securities Exchange Act of 1934) or in privately negotiated transactions, subject to market and business conditions. As of September 25, 2013, we had repurchased 6.0 million shares of Common Stock for approximately $31.9 million under this share repurchase program, thus completing the program.

On April 25, 2013, we announced that our Board of Directors approved a new share repurchase program authorizing us to repurchase up to an additional 10.0 million shares of our Common Stock. Under this program, we may, from time to time, purchase shares in the open market (including pre-arranged stock trading plans in accordance with the guidelines specified in Rule 10b5-1 under the Securities Exchange Act of 1934) or in privately negotiated transactions, subject to market and business conditions. As of September 25, 2013, we had repurchased 0.3 million shares of Common Stock for approximately $1.9 million and there were 9.7 million shares remaining to be repurchased under this share repurchase program.

For the three quarters ended September 25, 2013 we repurchased a total of 3.8 million shares of Common Stock for approximately $21.6 million under our share repurchase programs.

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Document and Entity Information	9 Months Ended
	Sep. 25, 2013	Oct. 24, 2013
Document and Entity Information [Abstract]
Entity Registrant Name	DENNYS CORP
Entity Central Index Key	0000852772
Current Fiscal Year End Date	--12-25
Entity Well-known Seasoned Issuer	No
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Filer Category	Accelerated Filer
Entity Common Stock, Shares Outstanding		89,237,478
Document Fiscal Year Focus	2013
Document Fiscal Period Focus	Q3
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Sep. 25, 2013

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Commitments and Contingencies

9 Months Ended

Sep. 25, 2013

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

Commitments and Contingencies

There are various claims and pending legal actions against or indirectly involving us, incidental to and arising out of the ordinary course of the business. In the opinion of management, based upon information currently available, the ultimate liability with respect to these proceedings and claims will not materially affect the Company's consolidated results of operations or financial position. We record legal settlement costs as other operating expenses in our Condensed Consolidated Statements of Comprehensive Income as those costs are incurred.