Guarantor Financial Information

The Company's Notes (see Note 8) are guaranteed on an unsecured basis by the Company's 100% directly and indirectly owned subsidiaries Darling National, Griffin and its subsidiary Craig Protein (collectively, the "Guarantors"). The Guarantors fully and unconditionally guaranteed the Notes on a joint and several basis. The following financial statements present condensed consolidating financial data for (i) Darling, the issuer of the Notes, (ii) the combined Guarantors, (iii) the combined other subsidiaries of the Company that did not guarantee the Notes (the "Non-guarantors"), and (iv) eliminations necessary to arrive at the Company's consolidated financial statements, which include condensed consolidated balance sheets as of July 2, 2011 and January 1, 2011, and the condensed consolidating statements of operations for the three and six months ended July 2, 2011 and July 3, 2010 and the condensed consolidating statements of cash flows for the six months ended July 2, 2011 and July 3, 2010.

Condensed Consolidating Balance Sheet

As of July 2, 2011

(in thousands)



	Issuer		Guarantors		Non-guarantors			Eliminations			Consolidated
ASSETS
Total current assets	$	95,852	$	310,077	$	3,344		$	(196,967	)	$	212,306
Investment in subsidiaries	1,211,650		—		—			(1,211,650		)	—
Property, plant and equipment, net	118,733		277,271		—			—			396,004
Intangible assets, net	19,833		356,744		304			—			376,881
Goodwill	32,441		345,343		266			—			378,050
Investment in unconsolidated subsidiary	—		—		9,567			—			9,567
Other assets	27,652		3,362		—			—			31,014
	$	1,506,161	$	1,292,797	$	13,481		$	(1,408,617	)	$	1,403,822
LIABILITIES AND STOCKHOLDERS’ EQUITY
Total current liabilities	$	265,108	$	80,896	$	2,516		$	(196,967	)	$	151,553
Long-term debt, net of current portion	329,848		25		—			—			329,873
Other noncurrent liabilities	35,321		11,004		187			—			46,512
Deferred income taxes	15,154		—		—			—			15,154
Total liabilities	645,431		91,925		2,703			(196,967		)	543,092
Stockholders’ equity:
Common stock, additional paid-in capital and treasury stock	583,212		1,022,544		15,412			(1,037,956		)	583,212
Retained earnings and accumulated other comprehensive loss	277,518		178,328		(4,634		)	(173,694		)	277,518
Total stockholders’ equity	860,730		1,200,872		10,778			(1,211,650		)	860,730
	$	1,506,161	$	1,292,797	$	13,481		$	(1,408,617	)	$	1,403,822

Condensed Consolidating Balance Sheet

As of January 1, 2011

(in thousands)



	Issuer		Guarantors		Non-guarantors			Eliminations			Consolidated
ASSETS
Total current assets	$	95,679	$	196,383	$	4,669		$	(111,145	)	$	185,586
Investment in subsidiaries	1,118,467		—		—			(1,118,467		)	—
Property, plant and equipment, net	119,511		273,909		—			—			393,420
Intangible assets, net	21,569		369,385		—			—			390,954
Goodwill	32,441		343,822		—			—			376,263
Other assets	31,136		3,321		1,578			—			36,035
	$	1,418,803	$	1,186,820	$	6,247		$	(1,229,612	)	$	1,382,258
LIABILITIES AND STOCKHOLDERS’ EQUITY
Total current liabilities	$	202,705	$	59,343	$	3,927		$	(111,145	)	$	154,830
Long-term debt, net of current portion	707,000		30		—			—			707,030
Other noncurrent liabilities	39,460		11,004		296			—			50,760
Deferred income taxes	5,342		—		—			—			5,342
Total liabilities	954,507		70,377		4,223			(111,145		)	917,962
Stockholders’ equity:
Common stock, additional paid-in capital and treasury stock	286,696		1,022,544		6,224			(1,028,768		)	286,696
Retained earnings and accumulated other comprehensive loss	177,600		93,899		(4,200		)	(89,699		)	177,600
Total stockholders’ equity	464,296		1,116,443		2,024			(1,118,467		)	464,296
	$	1,418,803	$	1,186,820	$	6,247		$	(1,229,612	)	$	1,382,258

Condensed Consolidated Statements of Operations

For the three months ended July 2, 2011

(in thousands)



	Issuer			Guarantors			Non-guarantors			Eliminations			Consolidated
Net sales	$	183,604		$	327,243		$	4,683		$	(44,920	)	$	470,610
Cost and expenses:
Cost of sales and operating expenses	135,325			230,335			4,489			(44,921		)	325,228
Selling, general and administrative expenses	17,524			16,527			41			—			34,092
Depreciation and amortization	5,571			13,473			11			—			19,055
Total costs and expenses	158,420			260,335			4,541			(44,921		)	378,375
Operating income	25,184			66,908			142			1			92,235

Interest expense	(7,745		)	—			—			—			(7,745		)
Other, net	(648		)	(283		)	102			(1		)	(830		)
Equity in net loss of unconsolidated subsidiary	—			—			(1,174		)	—			(1,174		)
Earnings in investments in subsidiaries	41,588			—			—			(41,588		)	—
Income from operations before taxes	58,379			66,625			(930		)	(41,588		)	82,486
Income taxes	6,152			24,448			(341		)	—			30,259
Net income	$	52,227		$	42,177		$	(589	)	$	(41,588	)	$	52,227

Condensed Consolidated Statements of Operations

For the six months ended July 2, 2011

(in thousands)



	Issuer			Guarantors			Non-guarantors			Eliminations			Consolidated
Net sales	$	358,259		$	634,357		$	11,232		$	(93,340	)	$	910,508
Cost and expenses:
Cost of sales and operating expenses	267,379			441,834			10,746			(93,340		)	626,619
Selling, general and administrative expenses	32,711			31,993			81			—			64,785
Depreciation and amortization	11,755			26,970			11			—			38,736
Total costs and expenses	311,845			500,797			10,838			(93,340		)	730,140
Operating income	46,414			133,560			394			—			180,368

Interest expense	(21,972		)	(1		)	—			—			(21,973		)
Other, net	(1,106		)	(385		)	95			—			(1,396		)
Equity in net loss of unconsolidated subsidiary	—			—			(1,174		)	—			(1,174		)
Earnings in investments in subsidiaries	83,995			—			—			(83,995		)	—
Income from operations before taxes	107,331			133,174			(685		)	(83,995		)	155,825
Income taxes	8,542			48,745			(251		)	—			57,036
Net income	$	98,789		$	84,429		$	(434	)	$	(83,995	)	$	98,789

Condensed Consolidated Statements of Operations

For the three months ended July 3, 2010

(in thousands)



	Issuer			Guarantors			Non-guarantors			Eliminations			Consolidated
Net sales	$	132,470		$	64,650		$	—		$	(30,910	)	$	166,210
Cost and expenses:
Cost of sales and operating expenses	99,717			55,046			—			(30,910		)	123,853
Selling, general and administrative expenses	14,873			1,364			—			—			16,237
Depreciation and amortization	5,336			1,870			—			—			7,206
Total costs and expenses	119,926			58,280			—			(30,910		)	147,296
Operating income	12,544			6,370			—			—			18,914

Interest expense	(888		)	(1		)	—			—			(889		)
Other, net	(120		)	6			(334		)	—			(448		)
Earnings in investments in subsidiaries	3,930			—			—			(3,930		)	—
Income from operations before taxes	15,466			6,375			(334		)	(3,930		)	17,577
Income taxes (benefit)	4,095			2,229			(118		)	—			6,206
Net income	$	11,371		$	4,146		$	(216	)	$	(3,930	)	$	11,371

Condensed Consolidated Statements of Operations

For the six months ended July 3, 2010

(in thousands)



	Issuer			Guarantors			Non-guarantors			Eliminations			Consolidated
Net sales	$	257,385		$	135,512		$	—		$	(63,905	)	$	328,992
Cost and expenses:
Cost of sales and operating expenses	195,358			112,810			—			(63,905		)	244,263
Selling, general and administrative expenses	29,264			2,738			—			—			32,002
Depreciation and amortization	10,458			3,772			—			—			14,230
Total costs and expenses	235,080			119,320			—			(63,905		)	290,495
Operating income	22,305			16,192			—			—			38,497

Interest expense	(1,797		)	(2		)	—			—			(1,799		)
Other, net	(313		)	8			(677		)	—			(982		)
Earnings in investments in subsidiaries	9,929			—			—			(9,929		)	—
Income from operations before taxes	30,124			16,198			(677		)	(9,929		)	35,716
Income taxes (benefit)	7,275			5,836			(244		)	—			12,867
Net income	$	22,849		$	10,362		$	(433	)	$	(9,929	)	$	22,849

Condensed Consolidated Statements of Cash Flows

For the six months ended July 2, 2011

(in thousands)



	Issuer			Guarantors			Non-guarantors			Eliminations			Consolidated
Cash flows from operating activities:
Net income	$	98,789		$	84,429		$	(434	)	$	(83,995	)	$	98,789
Earnings in investments in subsidiaries	(83,995		)	—			—			83,995			—
Other operating cash flows	79,603			(70,755		)	10,867			—			19,715
Net cash provided by operating activities	94,397			13,674			10,433			—			118,504

Cash flows from investng activities:
Capital expenditures	(10,770		)	(17,100		)	—			—			(27,870		)
Acquisitions	(164		)	—			—			—			(164		)
Investment in unconsolidated subsidiary	—			—			(10,741		)	—			(10,741		)
Gross proceeds from sale of property, plant and equipment and other assets	457			208			—			—			665
Net cash used in investing activities	(10,477		)	(16,892		)	(10,741		)	—			(38,110		)

Cash flows from financing activities:
Payments on long-term debt	(240,000		)	(5		)	—			—			(240,005		)
Net payments on revolver	(140,000		)	—			—			—			(140,000		)
Deferred loan costs	(267		)	—			—			—			(267		)
Issuances of common stock	293,189			—			—			—			293,189
Minimum withholding taxes paid on stock awards	(1,205		)	—			—			—			(1,205		)
Excess tax benefits from stock-based compensation	1,136			—			—			—			1,136
Net cash used in financing activities	(87,147		)	(5		)	—			—			(87,152		)

Net decrease in cash and cash equivalents	(3,227		)	(3,223		)	(308		)	—			(6,758		)
Cash and cash equivalents at beginning of year	13,108			5,480			614			—			19,202
Cash and cash equivalents at end of year	$	9,881		$	2,257		$	306		$	—		$	12,444

Condensed Consolidated Statements of Cash Flows

For the six months ended July 3, 2010

(in thousands)



	Issuer			Guarantors			Non-guarantors			Eliminations			Consolidated
Cash flows from operating activities:
Net income	$	22,849		$	10,362		$	(433	)	$	(9,929	)	$	22,849
Earnings in investments in subsidiaries	(9,929		)	—			—			9,929			—
Other operating cash flows	11,882			(8,574		)	433			—			3,741
Net cash provided by operating activities	24,802			1,788			—			—			26,590

Cash flows from investng activities:
Capital expenditures	(7,593		)	(1,807		)	—			—			(9,400		)
Acquisitions	(15,284		)	—			—			—			(15,284		)
Gross proceeds from sale of property, plant and equipment and other assets	135			9			—			—			144
Payments related to routes and other intangibles	(991		)	—			—			—			(991		)
Net cash used in investing activities	(23,733		)	(1,798		)	—			—			(25,531		)

Cash flows from financing activities:
Payments on long-term debt	(2,500		)	(4		)	—			—			(2,504		)
Issuances of common stock	7			—			—			—			7
Minimum withholding taxes paid on stock awards	(442		)	—			—			—			(442		)
Excess tax benefits from stock-based compensation	184			—			—			—			184
Net cash used in financing activities	(2,751		)	(4		)	—			—			(2,755		)

Net decrease in cash and cash equivalents	(1,682		)	(14		)	—			—			(1,696		)
Cash and cash equivalents at beginning of year	68,126			56			—			—			68,182
Cash and cash equivalents at end of year	$	66,444		$	42		$	—		$	—		$	66,486