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 September 29, 2012 and December 31, 2011, and the condensed consolidating statements of operations, the condensed consolidating statements of comprehensive income and the condensed consolidating statements of cash flows for the three and nine months ended September 29, 2012 and October 1, 2011.

Condensed Consolidating Balance Sheet

As of September 29, 2012

(in thousands)



	Issuer		Guarantors		Non-guarantors		Eliminations			Consolidated
ASSETS
Total current assets	$	157,864	$	428,205	$	4,578	$	(315,624	)	$	275,023
Investment in subsidiaries	1,413,344		—		—		(1,413,344		)	—
Property, plant and equipment, net	141,232		297,737		—		—			438,969
Intangible assets, net	15,080		328,943		276		—			344,299
Goodwill	21,860		359,243		266		—			381,369
Investment in unconsolidated subsidiary	—		—		54,424		—			54,424
Other assets	28,928		471		—		—			29,399
	$	1,778,308	$	1,414,599	$	59,544	$	(1,728,968	)	$	1,523,483
LIABILITIES AND STOCKHOLDERS’ EQUITY
Total current liabilities	$	390,788	$	57,813	$	2,648	$	(315,624	)	$	135,625
Long-term debt, net of current portion	250,000		163		—		—			250,163
Other noncurrent liabilities	52,503		—		175		—			52,678
Deferred income taxes	49,436		—		—		—			49,436
Total liabilities	742,727		57,976		2,823		(315,624		)	487,902
Total stockholders’ equity	1,035,581		1,356,623		56,721		(1,413,344		)	1,035,581
	$	1,778,308	$	1,414,599	$	59,544	$	(1,728,968	)	$	1,523,483

Condensed Consolidating Balance Sheet

As of December 31, 2011

(in thousands)



	Issuer		Guarantors		Non-guarantors		Eliminations			Consolidated
ASSETS
Total current assets	$	124,675	$	347,989	$	3,980	$	(256,964	)	$	219,680
Investment in subsidiaries	1,286,175		—		—		(1,286,175		)	—
Property, plant and equipment, net	119,898		280,324		—		—			400,222
Intangible assets, net	14,747		347,874		293		—			362,914
Goodwill	21,860		359,243		266		—			381,369
Investment in unconsolidated subsidiary	—		—		21,733		—			21,733
Other assets	27,725		3,387		—		—			31,112
	$	1,595,080	$	1,338,817	$	26,272	$	(1,543,139	)	$	1,417,030
LIABILITIES AND STOCKHOLDERS’ EQUITY
Total current liabilities	$	317,561	$	63,718	$	2,942	$	(256,964	)	$	127,257
Long-term debt, net of current portion	280,000		20		—		—			280,020
Other noncurrent liabilities	46,011		12,052		182		—			58,245
Deferred income taxes	31,133		—		—		—			31,133
Total liabilities	674,705		75,790		3,124		(256,964		)	496,655
Total stockholders’ equity	920,375		1,263,027		23,148		(1,286,175		)	920,375
	$	1,595,080	$	1,338,817	$	26,272	$	(1,543,139	)	$	1,417,030

Condensed Consolidating Statements of Operations

For the three months ended September 29, 2012

(in thousands)



	Issuer			Guarantors			Non-guarantors			Eliminations			Consolidated
Net sales	$	165,256		$	330,013		$	3,814		$	(46,351	)	$	452,732
Cost and expenses:
Cost of sales and operating expenses	125,806			244,924			3,530			(46,351		)	327,909
Selling, general and administrative expenses	20,396			18,093			34			—			38,523
Depreciation and amortization	5,502			15,016			6			—			20,524
Total costs and expenses	151,704			278,033			3,570			(46,351		)	386,956
Operating income	13,552			51,980			244			—			65,776

Interest expense	(5,867		)	(1		)	—			—			(5,868		)
Other, net	(841		)	1,076			(3		)	—			232
Equity in net loss of unconsolidated subsidiary	—			—			(833		)	—			(833		)
Earnings in investments in subsidiaries	32,877			—			—			(32,877		)	—
Income/(loss) before taxes	39,721			53,055			(592		)	(32,877		)	59,307
Income taxes (benefit)	2,549			19,806			(220		)	—			22,135
Net income (loss)	$	37,172		$	33,249		$	(372	)	$	(32,877	)	$	37,172

Condensed Consolidating Statements of Operations

For the nine months ended September 29, 2012

(in thousands)



	Issuer			Guarantors			Non-guarantors			Eliminations			Consolidated
Net sales	$	502,814		$	903,712		$	10,089		$	(140,101	)	$	1,276,514
Cost and expenses:
Cost of sales and operating expenses	389,808			659,207			9,602			(140,101		)	918,516
Selling, general and administrative expenses	60,108			52,571			107			—			112,786
Depreciation and amortization	17,614			45,327			17			—			62,958
Total costs and expenses	467,530			757,105			9,726			(140,101		)	1,094,260
Operating income	35,284			146,607			363			—			182,254

Interest expense	(18,544		)	(2		)	—			—			(18,546		)
Other, net	(2,071		)	1,981			(16		)	—			(106		)
Equity in net loss of unconsolidated subsidiary	—			—			(1,725		)	—			(1,725		)
Earnings in investments in subsidiaries	92,728			—			—			(92,728		)	—
Income/(loss) from operations before taxes	107,397			148,586			(1,378		)	(92,728		)	161,877
Income taxes (benefit)	5,429			54,990			(510		)	—			59,909
Net income (loss)	$	101,968		$	93,596		$	(868	)	$	(92,728	)	$	101,968

Condensed Consolidating Statements of Operations

For the three months ended October 1, 2011

(in thousands)



	Issuer			Guarantors			Non-guarantors			Eliminations			Consolidated
Net sales	$	178,895		$	312,914		$	9,707		$	(45,641	)	$	455,875
Cost and expenses:
Cost of sales and operating expenses	139,946			223,127			9,450			(45,641		)	326,882
Selling, general and administrative expenses	18,322			17,124			41			—			35,487
Depreciation and amortization	5,336			13,611			6			—			18,953
Total costs and expenses	163,604			253,862			9,497			(45,641		)	381,322
Operating income	15,291			59,052			210			—			74,553

Interest expense	(7,408		)	(1		)	—			—			(7,409		)
Other, net	(798		)	(13		)	(22		)	—			(833		)
Equity in net loss of unconsolidated subsidiary	—			—			(170		)	—			(170		)
Earnings in investments in subsidiaries	36,750			—			—			(36,750		)	—
Income/(loss) before taxes	43,835			59,038			18			(36,750		)	66,141
Income taxes	2,703			22,302			4			—			25,009
Net income (loss)	$	41,132		$	36,736		$	14		$	(36,750	)	$	41,132

Condensed Consolidating Statements of Operations

For the nine months ended October 1, 2011

(in thousands)



	Issuer			Guarantors			Non-guarantors			Eliminations			Consolidated
Net sales	$	537,154		$	947,271		$	20,939		$	(138,981	)	$	1,366,383
Cost and expenses:
Cost of sales and operating expenses	407,157			665,065			20,196			(138,981		)	953,437
Selling, general and administrative expenses	51,033			49,117			122			—			100,272
Depreciation and amortization	17,091			40,581			17			—			57,689
Total costs and expenses	475,281			754,763			20,335			(138,981		)	1,111,398
Operating income	61,873			192,508			604			—			254,985

Interest expense	(29,380		)	(2		)	—			—			(29,382		)
Other, net	(2,072		)	(294		)	73			—			(2,293		)
Equity in net loss of unconsolidated subsidiary	—			—			(1,344		)	—			(1,344		)
Earnings in investments in subsidiaries	120,745			—			—			(120,745		)	—
Income/(loss) from operations before taxes	151,166			192,212			(667		)	(120,745		)	221,966
Income taxes (benefit)	11,245			71,047			(247		)	—			82,045
Net income (loss)	$	139,921		$	121,165		$	(420	)	$	(120,745	)	$	139,921

Condensed Consolidating Statements of Comprehensive Income (Loss)

For the three months ended September 29, 2012

(in thousands)



	Issuer		Guarantors		Non-guarantors			Eliminations			Consolidated
Net income	$	37,172	$	33,249	$	(372	)	$	(32,877	)	$	37,172
Other comprehensive income (loss):
Pension adjustments, net of tax	742		—		—			—			742
Natural gas swap derivative adjustments, net of tax	83		—		—			—			83
Interest rate swap derivative adjustment, net of tax	—		—		—			—			—
Total other comprehensive income	825		—		—			—			825
Total comprehensive income (loss)	$	37,997	$	33,249	$	(372	)	$	(32,877	)	$	37,997

Condensed Consolidating Statements of Comprehensive Income (Loss)

For the nine months ended September 29, 2012

(in thousands)



	Issuer		Guarantors		Non-guarantors			Eliminations			Consolidated
Net income	$	101,968	$	93,596	$	(868	)	$	(92,728	)	$	101,968
Other comprehensive income (loss):
Pension adjustments, net of tax	2,226		—		—			—			2,226
Natural gas swap derivative adjustments, net of tax	404		—		—			—			404
Interest rate swap derivative adjustment, net of tax	159		—		—			—			159
Total other comprehensive income	2,789		—		—			—			2,789
Total comprehensive income (loss)	$	104,757	$	93,596	$	(868	)	$	(92,728	)	$	104,757

Condensed Consolidating Statements of Comprehensive Income (Loss)

For the three months ended October 1, 2011

(in thousands)



	Issuer			Guarantors		Non-guarantors		Eliminations			Consolidated
Net income	$	41,132		$	36,736	$	14	$	(36,750	)	$	41,132
Other comprehensive income (loss):
Pension adjustments, net of tax	431			—		—		—			431
Natural gas swap derivative adjustments, net of tax	(108		)	—		—		—			(108		)
Interest rate swap derivative adjustment, net of tax	174			—		—		—			174
Total other comprehensive income	497			—		—		—			497
Total comprehensive income (loss)	$	41,629		$	36,736	$	14	$	(36,750	)	$	41,629

Condensed Consolidating Statements of Comprehensive Income (Loss)

For the nine months ended October 1, 2011

(in thousands)



	Issuer			Guarantors		Non-guarantors			Eliminations			Consolidated
Net income	$	139,921		$	121,165	$	(420	)	$	(120,745	)	$	139,921
Other comprehensive income (loss):
Pension adjustments, net of tax	1,293			—		—			—			1,293
Natural gas swap derivative adjustments, net of tax	(222		)	—		—			—			(222		)
Interest rate swap derivative adjustment, net of tax	555			—		—			—			555
Total other comprehensive income	1,626			—		—			—			1,626
Total comprehensive income (loss)	$	141,547		$	121,165	$	(420	)	$	(120,745	)	$	141,547

Condensed Consolidating Statements of Cash Flows

For the nine months ended September 29, 2012

(in thousands)



	Issuer			Guarantors			Non-guarantors			Eliminations			Consolidated
Cash flows from operating activities:
Net income	$	101,968		$	93,596		$	(868	)	$	(92,728	)	$	101,968
Earnings in investments in subsidiaries	(92,728		)	—			—			92,728			—
Other operating cash flows	142,681			(45,631		)	(542		)	—			96,508
Net cash provided by operating activities	151,921			47,965			(1,410		)	—			198,476

Cash flows from investing activities:
Capital expenditures	(37,183		)	(46,971		)	—			—			(84,154		)
Acquisitions	(3,000		)	—			—			—			(3,000		)
Investment in subsidiaries and affiliates	(34,441		)	—			(34,416		)	34,441			(34,416		)
Gross proceeds from sale of property, plant and equipment and other assets	1,580			1,409			—			—			2,989
Net cash used in investing activities	(73,044		)	(45,562		)	(34,416		)	34,441			(118,581		)

Cash flows from financing activities:
Payments on long-term debt	(30,000		)	(13		)	—			—			(30,013		)
Issuances of common stock	64			—			—			—			64
Contributions from parent	—			—			34,441			(34,441		)	—
Minimum withholding taxes paid on stock awards	(3,365		)	—			—			—			(3,365		)
Excess tax benefits from stock-based compensation	2,169			—			—			—			2,169
Net cash used in financing activities	(31,132		)	(13		)	34,441			(34,441		)	(31,145		)

Net increase/(decrease) in cash and cash equivalents	47,745			2,390			(1,385		)	—			48,750
Cash and cash equivalents at beginning of year	35,207			1,773			1,956			—			38,936
Cash and cash equivalents at end of year	$	82,952		$	4,163		$	571		$	—		$	87,686

Condensed Consolidating Statements of Cash Flows

For the nine months ended October 1, 2011

(in thousands)



	Issuer			Guarantors			Non-guarantors			Eliminations			Consolidated
Cash flows from operating activities:
Net income	$	139,921		$	121,165		$	(420	)	$	(120,745	)	$	139,921
Earnings in investments in subsidiaries	(120,745		)	—			—			120,745			—
Other operating cash flows	129,834			(95,774		)	185			—			34,245
Net cash provided by operating activities	149,010			25,391			(235		)	—			174,166

Cash flows from investing activities:
Capital expenditures	(16,904		)	(27,117		)	—			—			(44,021		)
Acquisitions	(164		)	—			—			—			(164		)
Investment in subsidiaries and affiliates	(14,267		)	—			(14,242		)	14,267			(14,242		)
Gross proceeds from sale of property, plant and equipment and other assets	714			286			—			—			1,000
Net cash used in investing activities	(30,621		)	(26,831		)	(14,242		)	14,267			(57,427		)

Cash flows from financing activities:
Payments on long-term debt	(240,000		)	(7		)	—			—			(240,007		)
Borrowings from revolving credit facility	131,000			—			—			—			131,000
Payments on revolving credit facility	(291,000		)	—			—			—			(291,000		)
Deferred loan costs	(482		)	—			—			—			(482		)
Issuances of common stock	293,189			—			—			—			293,189
Contributions from parent	—			—			14,267			(14,267		)	—
Minimum withholding taxes paid on stock awards	(1,217		)	—			—			—			(1,217		)
Excess tax benefits from stock-based compensation	1,126			—			—			—			1,126
Net cash used in financing activities	(107,384		)	(7		)	14,267			(14,267		)	(107,391		)

Net increase/(decrease) in cash and cash equivalents	11,005			(1,447		)	(210		)	—			9,348
Cash and cash equivalents at beginning of year	13,108			5,480			614			—			19,202
Cash and cash equivalents at end of year	$	24,113		$	4,033		$	404		$	—		$	28,550