Guarantor/Non-Guarantor

(Wendy’s Restaurants)

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

As a result of the closing of the sale of Arby’s on July 4, 2011 as described in Note 2, Arby’s and its subsidiaries are no longer guaranteeing subsidiaries of the amounts outstanding under the Senior Notes. Accordingly, the Condensed Consolidating Statements of Operations, Comprehensive Income and Cash Flows for the three months ended April 3, 2011 presented below have been retroactively revised to reflect Arby’s and its subsidiaries as non-guarantors. In addition, Arby’s has been reflected as discontinued operations in the Condensed Consolidating Statement of Operations for the three months ended April 3, 2011. Arby’s cash flows for the three months ended April 3, 2011 have been included in, and not separately reported from, our consolidated cash flows.

The following are included in the presentation of our: (1) Condensed Consolidating Balance Sheets as of April 1, 2012 and January 1, 2012, (2) Condensed Consolidating Statements of Operations for the three months ended April 1, 2012 and April 3, 2011, (3) Condensed Consolidating Statements of Comprehensive Income for the three months ended April 1, 2012 and April 3, 2011 and (4) Condensed Consolidating Statements of Cash Flows for the three months ended April 1, 2012 and April 3, 2011 to reflect:

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

(b)the Senior Notes guarantor subsidiaries as a group;

(c)the Senior Notes non-guarantor subsidiaries as a group;

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

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

Substantially all of our domestic restricted subsidiaries are guarantors of the Senior Notes. Certain of our subsidiaries, including our foreign subsidiaries and national advertising funds, do not guarantee the Senior Notes.

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

CONDENSED CONSOLIDATING BALANCE SHEET

April 1, 2012



				Guarantor			Non-guarantor
	Parent			Subsidiaries			Subsidiaries			Eliminations			Total
ASSETS
Current assets:
Cash and cash equivalents	$	110,150		$	134,399		$	37,164		$	—		$	281,713
Accounts and notes receivable	1,430			60,075			6,469			—			67,974
Inventories	—			10,958			1,046			—			12,004
Prepaid expenses and other current assets	4,688			28,602			1,580			—			34,870
Deferred income tax benefit	57,437			34,226			1,004			—			92,667
Due from affiliate	322,597			—			—			(322,597		)	—
Advertising funds restricted assets	—			—			77,289			—			77,289
Total current assets	496,302			268,260			124,552			(322,597		)	566,517
Properties	11,012			1,124,305			59,789			—			1,195,106
Goodwill	—			828,914			149,115			(100,720		)	877,309
Other intangible assets	16,620			1,258,578			24,282			—			1,299,480
Investments	19,000			—			95,759			—			114,759
Deferred costs and other assets	25,052			40,668			391			—			66,111
Net investment in subsidiaries	2,274,293			354,763			—			(2,629,056		)	—
Deferred income tax benefit	31,368			—			—			(31,368		)	—
Total assets	$	2,873,647		$	3,875,488		$	453,888		$	(3,083,741	)	$	4,119,282

LIABILITIES AND INVESTED EQUITY
Current liabilities:
Current portion of long-term debt	$	4,785		$	919		$	265		$	—		$	5,969
Accounts payable	3,723			44,377			5,414			—			53,514
Accrued expenses and other current liabilities	40,553			139,557			5,659			—			185,769
Due to affiliates	—			332,045			4,354			(322,597		)	13,802
Advertising funds restricted liabilities	—			—			77,289			—			77,289
Total current liabilities	49,061			516,898			92,981			(322,597		)	336,343
Long-term debt	1,015,550			320,290			3,536			—			1,339,376
Deferred income	—			5,662			345			—			6,007
Deferred income taxes	—			551,579			15,762			(31,368		)	535,973
Other liabilities	3,001			84,217			8,330			—			95,548
Invested equity:
Member interest	—			—			—			—			—
Other capital	2,442,486			2,169,333			332,805			(2,502,138		)	2,442,486
(Accumulated deficit) retained earnings	(487,294		)	376,666			(5,714		)	(370,952		)	(487,294		)
Advances to The Wendy’s Company	(155,000		)	(155,000		)	—			155,000			(155,000		)
Accumulated other comprehensive income	5,843			5,843			5,843			(11,686		)	5,843
Total invested equity	1,806,035			2,396,842			332,934			(2,729,776		)	1,806,035
Total liabilities and invested equity	$	2,873,647		$	3,875,488		$	453,888		$	(3,083,741	)	$	4,119,282

CONDENSED CONSOLIDATING BALANCE SHEET

January 1, 2012



				Guarantor			Non-guarantor
	Parent			Subsidiaries			Subsidiaries			Eliminations			Total
ASSETS
Current assets:
Cash and cash equivalents	$	174,638		$	128,818		$	43,192		$	—		$	346,648
Accounts and notes receivable	2,682			59,137			5,634			—			67,453
Inventories	—			11,766			1,137			—			12,903
Prepaid expenses and other current assets	5,446			11,732			1,230			—			18,408
Deferred income tax benefit	59,737			34,226			1,000			—			94,963
Advertising funds restricted assets	—			—			69,672			—			69,672
Total current assets	242,503			245,679			121,865			—			610,047
Properties	12,431			1,120,383			59,382			—			1,192,196
Goodwill	—			828,411			145,133			(97,836		)	875,708
Other intangible assets	18,011			1,262,070			24,207			—			1,304,288
Investments	19,000			—			95,651			—			114,651
Deferred costs and other assets	26,446			40,131			250			—			66,827
Net investment in subsidiaries	2,253,006			348,931			—			(2,601,937		)	—
Deferred income tax benefit	29,269			—			—			(29,269		)	—
Due from affiliate	295,080			—			—			(295,080		)	—
Total assets	$	2,895,746		$	3,845,605		$	446,488		$	(3,024,122	)	$	4,163,717

LIABILITIES AND INVESTED EQUITY
Current liabilities:
Current portion of long-term debt	$	3,952		$	923		$	262		$	—		$	5,137
Accounts payable	9,215			64,251			7,520			—			80,986
Accrued expenses and other current liabilities	62,209			137,105			12,836			—			212,150
Advertising funds restricted liabilities	—			—			69,672			—			69,672
Total current liabilities	75,376			202,279			90,290			—			367,945
Long-term debt	1,017,401			319,643			3,515			—			1,340,559
Due to affiliates	—			308,654			1,794			(295,080		)	15,368
Deferred income	—			6,132			391			—			6,523
Deferred income taxes	—			551,579			15,379			(29,269		)	537,689
Other liabilities	3,305			84,647			8,017			—			95,969
Invested equity:
Member interest	—			—			—			—			—
Other capital	2,440,130			2,168,046			332,707			(2,500,753		)	2,440,130
(Accumulated deficit) retained earnings	(486,567		)	358,524			(6,706		)	(351,818		)	(486,567		)
Advances to The Wendy’s Company	(155,000		)	(155,000		)	—			155,000			(155,000		)
Accumulated other comprehensive income	1,101			1,101			1,101			(2,202		)	1,101
Total invested equity	1,799,664			2,372,671			327,102			(2,699,773		)	1,799,664
Total liabilities and invested equity	$	2,895,746		$	3,845,605		$	446,488		$	(3,024,122	)	$	4,163,717

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS

For the three months ended April 1, 2012



				Guarantor			Non-guarantor
	Parent			Subsidiaries			Subsidiaries			Eliminations			Total
Revenues:
Sales	$	—		$	466,685		$	53,244		$	—		$	519,929
Franchise revenues	—			68,923			4,335			—			73,258
	—			535,608			57,579			—			593,187

Costs and expenses:
Cost of sales	—			406,024			49,443			—			455,467
General and administrative	—			66,024			4,056			—			70,080
Depreciation and amortization	2,981			26,765			2,562			—			32,308
Impairment of long-lived assets	—			2,630			253			—			2,883
Facilities relocation and other transition costs	5,444			87			—			—			5,531
Transaction related costs	615			(3		)	—			—			612
Other operating expense (income), net	442			2,543			(1,414		)	—			1,571
	9,482			504,070			54,900			—			568,452
Operating (loss) profit	(9,482		)	31,538			2,679			—			24,735
Interest expense	(22,158		)	(5,749		)	(166		)	—			(28,073		)
Other income (expense), net	5,283			(1,448		)	(2,260		)	—			1,575
Equity in income of subsidiaries	15,258			992			—			(16,250		)	—
(Loss) income before income taxes	(11,099		)	25,333			253			(16,250		)	(1,763		)
Benefit from (provision for) income taxes	10,372			(10,075		)	739			—			1,036
Net (loss) income	$	(727	)	$	15,258		$	992		$	(16,250	)	$	(727	)

CONDENSED CONSOLIDATING STATEMENT OF COMPREHENSIVE INCOME

For the three months ended April 1, 2012



				Guarantor		Non-guarantor
	Parent			Subsidiaries		Subsidiaries		Eliminations			Total

Net (loss) income	$	(727	)	$	15,258	$	992	$	(16,250	)	$	(727	)
Other comprehensive income, net:
Foreign currency translation adjustment	4,742			4,742		4,742		(9,484		)	4,742
Other comprehensive income, net	4,742			4,742		4,742		(9,484		)	4,742
Comprehensive income	$	4,015		$	20,000	$	5,734	$	(25,734	)	$	4,015

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS

For the three months ended April 3, 2011



				Guarantor			Non-guarantor
	Parent			Subsidiaries			Subsidiaries			Eliminations			Total
Revenues:
Sales	$	—		$	455,569		$	53,758		$	(41	)	$	509,286
Franchise revenues	—			68,766			4,421			(8		)	73,179
	—			524,335			58,179			(49		)	582,465

Costs and expenses:
Cost of sales	—			390,025			48,846			—			438,871
General and administrative	—			60,606			11,333			—			71,939
Depreciation and amortization	2,588			24,597			2,664			—			29,849
Impairment of long-lived assets	—			7,543			354			—			7,897
Transaction related costs	1,279			—			—			—			1,279
Other operating expense (income), net	—			2,674			(1,932		)	—			742
	3,867			485,445			61,265			—			550,577
Operating (loss) profit	(3,867		)	38,890			(3,086		)	(49		)	31,888
Interest expense	(23,336		)	(5,734		)	(145		)	—			(29,215		)
Other income (expense), net	—			3,798			(3,585		)	—			213
Equity in income (loss) of subsidiaries	13,386			(8,716		)	—			(4,670		)	—
(Loss) income from continuing operations before income taxes	(13,817		)	28,238			(6,816		)	(4,719		)	2,886
Benefit from (provision for) income taxes	14,842			(13,690		)	(1,900		)	—			(748		)
Income (loss) from continuing operations	1,025			14,548			(8,716		)	(4,719		)	2,138
Loss from discontinued operations, net of income taxes	—			—			(1,162		)	49			(1,113		)
Net income (loss)	$	1,025		$	14,548		$	(9,878	)	$	(4,670	)	$	1,025

CONDENSED CONSOLIDATING STATEMENT OF COMPREHENSIVE INCOME

For the three months ended April 3, 2011



				Guarantor			Non-guarantor
	Parent			Subsidiaries			Subsidiaries			Eliminations			Total

Net income (loss)	$	1,025		$	14,548		$	(9,878	)	$	(4,670	)	$	1,025
Other comprehensive income, net:
Foreign currency translation adjustment	7,649			7,649			7,649			(15,298		)	7,649
Change in net unrecognized pension loss, net of income tax provision of $15 in 2011	(55		)	(55		)	(55		)	110			(55		)
Other comprehensive income, net	7,594			7,594			7,594			(15,188		)	7,594
Comprehensive income (loss)	$	8,619		$	22,142		$	(2,284	)	$	(19,858	)	$	8,619

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

For the three months ended April 1, 2012



				Guarantor			Non-guarantor
	Parent			Subsidiaries			Subsidiaries			Eliminations			Total
Cash flows from operating activities:
Net (loss) income	$	(727	)	$	15,258		$	992		$	(16,250	)	$	(727	)
Adjustments to reconcile net (loss) income to net cash (used in) provided by operating activities:
Equity in income from operations of subsidiaries	(15,258		)	(992		)	—			16,250			—
Depreciation and amortization	3,622			26,765			2,562			—			32,949
Distributions received from joint venture	—			—			3,253			—			3,253
Impairment of long-lived assets	—			2,630			253			—			2,883
Share-based compensation provision	1,071			1,187			98			—			2,356
Accretion of long-term debt	524			1,486			—			—			2,010
Non-cash rent expense (credit)	—			1,661			(22		)	—			1,639
Write-off and amortization of deferred financing costs	1,349			—			—			—			1,349
Tax sharing receipt from (payment to) affiliate, net	12,000			(12,000		)	—			—			—
Net recognition of deferred vendor incentives	—			(58		)	—			—			(58		)
Deferred income tax benefit, net	(857		)	—			—			—			(857		)
Equity in earnings in joint ventures, net	—			—			(2,134		)	—			(2,134		)
Other, net	(38,626		)	38,792			(356		)	—			(190		)
Changes in operating assets and liabilities:
Accounts and notes receivable	1,322			(795		)	(690		)	—			(163		)
Inventories	—			803			117			—			920
Prepaid expenses and other current assets	969			(3,092		)	(321		)	—			(2,444		)
Accounts payable	(3,307		)	(7,707		)	(1,134		)	—			(12,148		)
Accrued expenses and other current liabilities	(22,255		)	(11,755		)	(7,728		)	—			(41,738		)
Net cash (used in) provided by operating activities	(60,173		)	52,183			(5,110		)	—			(13,100		)
Cash flows from investing activities:
Capital expenditures	(2,774		)	(41,495		)	(2,729		)	—			(46,998		)
Restaurant acquisitions	—			(2,594		)	—			—			(2,594		)
Franchise incentive loans	—			(1,096		)	—			—			(1,096		)
Other, net	—			(924		)	907			—			(17		)
Net cash used in investing activities	(2,774		)	(46,109		)	(1,822		)	—			(50,705		)
Cash flows from financing activities:
Repayments of long-term debt	(1,541		)	(493		)	(64		)	—			(2,098		)
Net cash used in financing activities	(1,541		)	(493		)	(64		)	—			(2,098		)
Net cash (used in) provided by operations before effect of exchange rate changes on cash	(64,488		)	5,581			(6,996		)	—			(65,903		)
Effect of exchange rate changes on cash	—			—			968			—			968
Net (decrease) increase in cash and cash equivalents	(64,488		)	5,581			(6,028		)	—			(64,935		)
Cash and cash equivalents at beginning of period	174,638			128,818			43,192			—			346,648
Cash and cash equivalents at end of period	$	110,150		$	134,399		$	37,164		$	—		$	281,713

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

For the three months ended April 3, 2011



				Guarantor			Non-guarantor
	Parent			Subsidiaries			Subsidiaries			Eliminations			Total
Cash flows from operating activities:
Net income (loss)	$	1,025		$	14,548		$	(9,878	)	$	(4,670	)	$	1,025
Adjustments to reconcile net income (loss) to net cash (used in) provided by operating activities:
Equity in (income) loss from operations of subsidiaries	(13,386		)	8,716			—			4,670			—
Depreciation and amortization	2,588			24,597			15,475			—			42,660
Net receipt of deferred vendor incentives	—			19,086			10,271			—			29,357
Impairment of long-lived assets	—			7,543			2,069			—			9,612
Distributions received from joint venture	—			—			3,113			—			3,113
Share-based compensation provision	1,196			1,223			580			—			2,999
Write-off and amortization of deferred financing costs	2,148			—			—			—			2,148
Accretion of long-term debt	595			1,456			79			—			2,130
Non-cash rent expense (credit)	—			1,914			(107		)	—			1,807
Tax sharing receipt from (payment to) affiliate, net	14,000			(14,000		)	—			—			—
Deferred income tax (benefit) provision, net	(272		)	(413		)	349			—			(336		)
Equity in earnings in joint venture	—			—			(2,363		)	—			(2,363		)
Tax sharing payment to The Wendy’s Company	(13,078		)	—			—			—			(13,078		)
Other, net	13,786			3,021			(17,051		)	—			(244		)
Changes in operating assets and liabilities net:
Accounts and notes receivable	37			2,163			6			—			2,206
Inventories	—			819			(1,189		)	—			(370		)
Prepaid expenses and other current assets	(633		)	(3,041		)	(4,823		)	—			(8,497		)
Accounts payable	(223		)	(933		)	4,770			—			3,614
Accrued expenses and other current liabilities	(21,046		)	(5,022		)	(7,112		)	—			(33,180		)
Net cash (used in) provided by operating activities	(13,263		)	61,677			(5,811		)	—			42,603
Cash flows from investing activities:
Capital expenditures	(3,293		)	(18,920		)	(6,355		)	—			(28,568		)
Restaurant acquisitions	—			(2,900		)	—			—			(2,900		)
Other, net	—			228			75			—			303
Net cash used in investing activities	(3,293		)	(21,592		)	(6,280		)	—			(31,165		)
Cash flows from financing activities:
Repayments of long-term debt	(26,117		)	(198		)	(3,450		)	—			(29,765		)
Capital contributions from Parent	(30,000		)	—			30,000			—			—
Other, net	(18		)	—			—			—			(18		)
Net cash (used in) provided by financing activities	(56,135		)	(198		)	26,550			—			(29,783		)
Net cash (used in) provided by operations before effect of exchange rate changes on cash	(72,691		)	39,887			14,459			—			(18,345		)
Effect of exchange rate changes on cash	—			—			959			—			959
Net (decrease) increase in cash and cash equivalents	(72,691		)	39,887			15,418			—			(17,386		)
Cash and cash equivalents at beginning of period	79,355			53,810			65,521			—			198,686
Cash and cash equivalents at end of period	$	6,664		$	93,697		$	80,939		$	—		$	181,300