Effective September 29, 2008, in conjunction with the merger with Wendy's International, Inc. ("Wendy's") described below under "Introduction and Executive Overview - Merger with Wendy's International, Inc.", the corporate name of Triarc Companies, Inc. ("Triarc") changed to Wendy's/Arby's Group, Inc. ("Wendy's/Arby's" or, together with its subsidiaries, the "Company" or "We"). This "Management's Discussion and Analysis of Financial Condition and Results of Operations" of the Company should be read in conjunction with our accompanying unaudited condensed consolidated financial statements included elsewhere herein and "Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations" in our Annual Report on Form 10-K for the fiscal year ended December 30, 2007 (the "Form 10-K"). Item 7 of our Form 10-K describes the application of our critical accounting policies for which there have been no significant changes as of September 28, 2008. Certain statements we make under this Item 2 constitute "forward-looking statements" under the Private Securities Litigation Reform Act of 1995. See "Special Note Regarding Forward-Looking Statements and Projections" in "Part II - Other Information" preceding "Item 1." Because the merger with Wendy's did not occur until the 2008 fourth quarter, the results of operations of Wendy's are not included in this report. The results of operations discussed below will not be indicative of future results due to the consummation of the merger transaction with Wendy's as well as the 2007 sale of our interest in Deerfield & Company LLC ("Deerfield") discussed below.

Introduction and Executive Overview

We currently operate in one business segment-the restaurant business through our Company-owned and franchised Arby's restaurants. Prior to December 21, 2007, we also operated in the asset management business through our 63.6% capital interest in Deerfield. On December 21, 2007, we sold our capital interest in Deerfield (the "Deerfield Sale") to Deerfield Capital Corp., a real estate investment trust ("DFR"). As a result of the Deerfield Sale, our 2008 financial statements include only the financial position, results of operations and cash flows from the restaurant business.

In April 2007 we announced that we would be closing our New York headquarters and combining its corporate operations with our restaurant operations in Atlanta, Georgia (the "Corporate Restructuring"). The Corporate Restructuring included the transfer of substantially all of our senior executive responsibilities to the executive team of Arby's Restaurant Group, Inc. ("ARG"), a wholly-owned subsidiary of ours, in Atlanta, Georgia. This transition was completed in early 2008. Accordingly, to facilitate this transition, the Company entered into negotiated contractual settlements (the "Contractual Settlements") with our Chairman, who was also our then Chief Executive Officer, and our Vice Chairman, who was our then President and Chief Operating Officer, (collectively, the "Former Executives") evidencing the termination of their employment agreements and providing for their resignation as executive officers as of June 29, 2007 (the "Separation Date"). In addition, we sold properties and other assets at our former New York headquarters in 2007 to an affiliate of the Former Executives and we incurred charges for the transition severance arrangements of other New York headquarters' executives and employees who continued to provide services as employees through the 2008 first quarter.

In our restaurant business, we derive revenues in the form of sales by our Company-owned restaurants and franchise revenues which include (1) royalty income from franchisees, (2) franchise and related fees and (3) rental income from properties leased to franchisees. Our revenues will significantly increase in the 2008 fourth quarter due to the merger with Wendy's that occurred on September 29, 2008. While approximately 78% of our existing Arby's royalty agreements and substantially all of our new domestic royalty agreements provide for royalties of 4% of franchise revenues, our average royalty rate was 3.6% for the nine months ended September 28, 2008. In our former asset management business, revenues were generated through the date of the Deerfield Sale in the form of asset management and related fees from our management of (1) collateralized debt and collateralized loan obligation vehicles ("CDOs"), and
(2) investment funds and private investment accounts ("Funds"), including DFR.

In our discussions of "Sales" and "Franchise Revenues" below, we discuss same-store sales. Beginning in our 2008 first quarter, we are reporting same-store sales commencing after a store has been open for fifteen continuous months (the "Fifteen Month Method") consistent with the metrics used by our management for internal reporting and analysis. Prior thereto, and including the 2007 fiscal year, the calculation of same-store sales commenced after a store was open for twelve continuous months (the "Twelve Month Method"). The table summarizing the results of operations for the current quarter below provides the same-store sales percentage change using the new Fifteen Month Method, as well as our former Twelve Month Method.

Our primary goal is to enhance the value of our Company by increasing the revenues of our restaurant business, which is expected to include (1) opening additional Company-owned Arby's and Wendy's restaurants through acquisitions and development, effective national and local advertising initiatives, adding new menu offerings, expansion of the breakfast daypart to a majority of our Arby's restaurants over the next two to three fiscal years and implementing operational initiatives targeted at improving service levels and convenience and (2) the possibility of other restaurant brand acquisitions.

We also maintain an investment portfolio principally from the investment of our excess cash with the objective of generating investment income. In December 2005 we invested $75.0 million in an account (the "Equities Account") which is managed by a management company (the "Management Company") formed by the Former Executives and a director, who was also our former Vice Chairman (collectively, the "Principals"). The Equities Account is invested principally in equity securities, including derivative instruments, of a limited number of publicly-traded companies. In addition, the Equities Account invests in market put options in order to lessen the impact of significant market downturns. Investment income (loss) from this account includes realized investment gains (losses) from marketable security transactions, realized and unrealized gains (losses) on derivative instruments, other than temporary losses, interest and dividends. The Equities Account, including restricted cash equivalents and equity derivatives, had a fair value of $63.2 million as of September 28, 2008. This amount excludes $30.0 million of restricted cash transferred from the Equities Account to Wendy's/Arby's in the 2008 third quarter, which we currently intend to return to the Equities Account by December 31, 2008. As of October 31, 2008, as of a result of continuing weakness in the economy during the fourth quarter of 2008 and its effect on the financial market, there has been a decrease of approximately $11.0 million in the fair value of the available for sale securities held in the Equities Account as compared to their value on September 28, 2008.

Our restaurant business has recently experienced trends in the following areas:

Revenues

· Significant decreases in general consumer confidence in the economy as well as decreases in many consumers' discretionary income caused by factors such as deteriorating financial markets, high fuel and food costs and a continuing softening of the economy, including the real estate market;

· Continuing price competition in the quick service restaurant ("QSR") industry, as evidenced by (1) value menu concepts, which offer comparatively lower prices on some menu items, (2) combination meal concepts, which offer a complete meal at an aggregate price lower than the price of the individual food and beverage items, (3) the use of coupons and other price discounting and (4) many recent product promotions focused on the lower prices of certain menu items;

· Competitive pressures due to extended hours of operation by many QSR competitors, including breakfast and late night hours;

· Competitive pressures from operators outside the QSR industry, such as the deli sections and in-store cafes of major grocery and other retail store chains, convenience stores and casual dining outlets offering prepared and take-out food purchases;

· Increased availability to consumers of new product choices, including (1) healthy products driven by a greater consumer awareness of nutritional issues,
(2) new products that tend to include larger portion sizes and more ingredients; (3) beverage programs which offer a wider selection of premium non-carbonated beverages, including coffee and tea products and (4) sandwiches with perceived higher levels of freshness, quality and customization; and

· Competitive pressures from an increasing number of franchise opportunities seeking to attract qualified franchisees.

· Higher commodity prices which have increased our food costs;

· Higher fuel costs, although recently moderating, which have caused increases in our utility costs and the cost of goods we purchase under distribution contracts that became effective in the second quarter of 2007;

· Federal, state and local legislative activity, such as minimum wage increases and mandated health and welfare benefits which have and are expected to continue to result in increased wages and related fringe benefits, including health care and other insurance costs; and

· Legal or regulatory activity related to nutritional content or menu labeling which could result in increased costs.

· Increased competition among QSR competitors and other businesses for available development sites and higher development costs associated with those sites.

Tightening of the overall credit markets and higher borrowing costs in the lending markets typically used to finance new unit development and remodels. These tightened credit conditions could negatively impact the renewal of franchisee licenses as well as the ability of a franchisee to meet its commitments under development, rental and franchise license agreements.

Merger with Wendy's International, Inc.

On September 29, 2008, Triarc and Wendy's completed their previously announced merger in an all-stock transaction in which Wendy's shareholders received a fixed ratio of 4.25 shares of Wendy's/Arby's class A common stock for each Wendy's common share owned.

In the merger, approximately 377,000,000 shares of Wendy's/Arby's common stock were issued to Wendy's shareholders. The merger value of approximately $2.5 billion for financial reporting purposes is based on the 4.25 conversion factor of the Wendy's outstanding shares as well as previously issued restricted stock awards both at a value of $6.57 per share which represents the average closing market price of Triarc Class A Common Stock two days before and after the merger announcement date of April 24, 2008. Wendy's shareholders held approximately 80%, in the aggregate, of the outstanding Wendy's/Arby's common stock immediately following the merger. In addition, effective on the date of the Wendy's merger, our Class B Common Stock was converted into Class A Common Stock.

The merger will be accounted for using the purchase method of accounting in accordance with Statement of Financial Accounting Standards ("SFAS") No. 141, "Business Combinations". In accordance with this standard, we have concluded that Wendy's/Arby's will be the acquirer for financial accounting purposes. The total merger value will be allocated to Wendy's net tangible and intangible assets acquired and liabilities assumed based on their estimated fair values with the excess recognized as goodwill. Wendy's operating results will be included in our financial statements beginning on the merger date.

Outstanding Wendy's stock options and other equity awards were converted upon completion of the merger into stock options and equity awards with respect to Wendy's/Arby's common stock, based on the 4.25:1 exchange ratio. As of the merger date, all outstanding Wendy's performance units became fully vested at the highest level of performance objectives and were settled in cash for $6.2 million in October 2008, based on the fair market value of Wendy's common shares at the time of the merger.

As of September 28, 2008, our deferred costs related to the merger, which will be included in the total consideration to be allocated to the assets acquired and liabilities assumed, were $18.5 million and are included in "Deferred costs and other assets" on the accompanying unaudited condensed consolidated balance sheet.

Certain pre-merger executive and other officers of Wendy's had employment agreements which included change in control provisions. The total value of these provisions at the merger date was $36.7 million. Prior to the completion of the merger, the full amount was transferred into a rabbi trust and will be paid to each executive in accordance with the terms of their respective agreements.

The Wendy's and Arby's brands will continue to operate independently, with headquarters in Dublin, Ohio and Atlanta, Georgia, respectively. A consolidated support center will be based in Atlanta, Georgia and will oversee all public company responsibilities as well as other shared service functions. The combined company had 10,360 systemwide restaurants in 50 states and 21 foreign countries and territories as of September 28, 2008, of which 2,577 were owned and operated by Wendy's/Arby's and 7,783 were owned and operated by independent franchisees.

The Deerfield Sale

On December 21, 2007, we completed the sale of our majority capital interest in Deerfield resulting in non-cash proceeds aggregating $134.6 million consisting of 9,629,368 shares of convertible preferred stock of DFR with a then estimated fair value of $88.4 million and $48.0 million principal amount of series A senior secured notes of a subsidiary of DFR due in December 2012 (the "DFR Notes") with a then estimated fair value of $46.2 million. We also retained ownership of 205,642 common shares in DFR as part of a pro rata distribution to the members of Deerfield prior to the Deerfield Sale. The Deerfield Sale resulted in a pretax gain of $40.2 million which was recorded in the fourth quarter of 2007.

The DFR Notes bear interest at the three-month LIBOR (3.76% at September 26, 2008) plus 5% through December 31, 2009, increasing 0.5% each quarter from January 1, 2010 through June 30, 2011 and 0.25% each quarter from July 1, 2011 through their maturity. The DFR Notes are secured by certain equity interests of DFR and certain of its subsidiaries. The $1.8 million original imputed discount on the DFR Notes is being accreted to "Other income (expense), net" using the interest rate method. The DFR Notes, net of unamortized discount, are reflected as "Notes receivable".

Conversion of Convertible Preferred Stock and Dividend of DFR Common Stock

On March 11, 2008, DFR stockholders approved the one-for-one conversion of all its outstanding convertible preferred stock into DFR common stock which converted the 9,629,368 preferred shares we held into a like number of shares of common stock. On March 11, 2008, our Board of Directors approved the distribution of our 9,835,010 shares of DFR common stock, which also included the 205,642 common shares of DFR discussed above, to our stockholders. The dividend, which was valued at $14.5 million, was paid on April 4, 2008 to holders of record of our class A common stock (the "Class A Common Stock") and our class B common stock (the "Class B Common Stock") on March 29, 2008.

Other than Temporary Losses and Equity in Losses of DFR

On March 18, 2008, in response to unanticipated credit and liquidity events in the first quarter of 2008, DFR announced that it was repositioning its investment portfolio to focus on agency-only residential mortgage-backed securities and away from its principal investing segment to its asset management segment with its fee-based revenue streams. In addition, it stated that during the first quarter of 2008, its portfolio was adversely impacted by deterioration of the global credit markets and, as a result, it sold $2.8 billion of its agency and $1.3 billion of its AAA-rated non-agency mortgage-backed securities and reduced the net notional amount of interest rate swaps used to hedge a portion of its mortgage-backed securities by $4.2 billion, all at a net after-tax loss of $294.3 million to DFR.

Based on the events described above and their negative effect on the market price of DFR common stock, we concluded that the fair value and, therefore, the carrying value of our investment in the 9,629,368 common shares, which were received upon the conversion of the convertible preferred stock as of March 11, 2008, as well as the 205,642 common shares which were distributed to us in connection with the Deerfield Sale, were impaired. As a result, as of March 11, 2008, we recorded an other than temporary loss which is included in "Investment
(loss) income, net," for the nine months ended September 28, 2008 of $67.6 million (without tax benefit as described below) which included $11.1 million of pre-tax unrealized holding losses previously recorded as of December 30, 2007 and included in "Accumulated other comprehensive income (loss)", a component of stockholder's equity. These common shares were considered available-for-sale securities due to the limited period they were to be held as of March 11, 2008 (the "Determination Date") before the dividend distribution of the shares to our stockholders on April 4, 2008. We also recorded an additional impairment charge from March 11, 2008 through March 29, 2008 of $0.5 million. As a result of the dividend, the income tax loss that resulted from the decline in value of our investment of $68.1 million is not deductible for income tax purposes and no income tax benefit was recorded related to this loss.

Additionally, from December 31, 2007 through the Determination Date, we recorded approximately $0.8 million of equity in net losses of DFR which are included in "Other income (expense), net" for the nine months ended September 28, 2008 related to our investment in the 205,642 common shares of DFR discussed above which were accounted for on the equity method through the Determination Date.

The dislocation in the mortgage sector and continuing weakness in the broader financial market has adversely impacted, and may continue to adversely impact, DFR's cash flows and DFR has reported operating losses for the first six months of 2008. However, we have received timely payment of all three quarterly interest payments due to date. Additionally, on October 15, 2008 we received a $1.1 million dividend on the convertible preferred stock which we previously held. Based on the Deerfield Sale agreement, payment of a dividend by DFR on this preferred stock was dependent on DFR's board of directors declaring and paying a dividend on DFR's common stock. The first dividend to be declared on their common stock following the date of the Deerfield Sale was declared in our 2008 third quarter and paid on October 15, 2008. Therefore, during the 2008 third quarter, we recognized the dividend income from DFR. DFR qualified for REIT status in previous quarters; however, on October 2, 2008, DFR announced, among other things, its conversion to a C corporation and the termination of its REIT status. Updated financial information from DFR for their 2008 third quarter ended September 30, 2008 will not be available until the filing of DFR's Form 10-Q. Based on publicly available information and the other factors discussed above, we believe the principal amount of the DFR Notes is fully collectible.

Presentation of Financial Information

We report on a fiscal year consisting of 52 or 53 weeks ending on the Sunday closest to December 31. Our third quarter of fiscal 2007 commenced on July 2, 2007 and ended on September 30, 2007 (the "three months ended September 30, 2007" or the "2007 third quarter"). Our third quarter of fiscal 2008 commenced on June 30, 2008 and ended on September 28, 2008 (the "three months ended September 28, 2008" or the "2008 third quarter"). Our first nine months of fiscal 2007 commenced on January 1, 2007 and ended on September 30, 2007 (the "nine months ended September 30, 2007" or the "2007 first nine months"). Our first nine months of fiscal 2008 commenced on December 31, 2007 and ended on September 28, 2008 (the "nine months ended September 28, 2008" or the "2008 first nine months"). Each quarter contained 13 weeks and each nine-month period contained 39 weeks. Our 2007 third quarter and first nine months included the calendar basis reported results of Deerfield. The difference in reporting basis is not material to our condensed consolidated financials statements. With the exception of Deerfield, all references to years, nine-month periods, and quarters relate to fiscal periods rather than calendar periods.

Results of Operations

Three Months Ended September 28, 2008 Compared with Three Months Ended September
30, 2007

Presented below is a table that summarizes our results of operations and
compares the amount and percent of the change between the 2007 third quarter and
the 2008 third quarter. Certain percentage changes between these quarters are
considered not measurable or not meaningful ("n/m").

                                                     Three Months Ended                         Change
                                             September 30,          September 28,
                                                 2007                   2008            Amount        Percent
                                                  (In Millions Except Restaurant Count and Percentages)
Revenues:
Sales                                      $           285.5       $         287.6     $     2.1         0.7%
Franchise revenues                                      21.8                  22.8           1.0         4.6%
Asset management and related fees                       16.9                     -         (16.9 )     (100.0)%
                                                       324.2                 310.4         (13.8 )      (4.3)%
Costs and expenses:
Cost of sales                                          210.9                 222.2          11.3         5.4%
Cost of services                                         6.6                     -          (6.6 )     (100.0)%
Advertising                                             20.9                  17.7          (3.2 )     (15.3)%
General and administrative                              42.0                  36.1          (5.9 )     (14.0)%
Depreciation and amortization                           20.0                  30.7          10.7        53.5%
Facilities relocation and corporate
restructuring                                            1.8                  (0.1 )        (1.9 )       n/m
                                                       302.2                 306.6           4.4         1.5%
Operating profit                                        22.0                   3.8         (18.2 )     (82.7)%
Interest expense                                       (15.5 )               (13.6 )        (2.1 )     (13.5)%
Investment loss, net                                    (1.1 )                (1.4 )        (0.3 )     (27.3)%
Other income, net                                        1.1                   1.1             -          -
Income (loss) from continuing operations
before income taxes and minority
interests                                                6.5                 (10.1 )       (16.6 )       n/m
Provision for income taxes                              (4.2 )                (2.9 )         1.3        31.0%
Minority interests in (income) loss of
consolidated subsidiaries                                1.4                  (0.3 )        (1.7 )       n/m
Income (loss) from continuing operations                 3.7                 (13.3 )       (17.0 )       n/m
Income from disposal of discontinued
operations, net of income taxes                            -                   1.2           1.2        100.0%
Net income (loss)                          $             3.7       $         (12.1 )   $   (15.8 )       n/m
Certain items as a percentage of sales:
Cost of sales                                      73.9%                  77.3%
Advertising                                         7.3%                  6.2%
Restaurant Margin (as defined in
"Restaurant Margin" below)                         18.8%                  16.6%




                                             Fifteen Month Method                  Twelve Month Method
                                          2007
                                          Third                             2007 Third
Same-store sales:                        Quarter    2008 Third Quarter        Quarter        2008 Third Quarter
Company-owned restaurants                (0.6%)           (7.2%)              (0.9%)               (7.6%)
Franchised restaurants                    1.2%            (4.0%)               0.9%                (4.2%)
Systemwide                                0.6%            (4.9%)               0.3%                (5.2%)




Restaurant count (Last 12 months):                    Company-Owned       Franchised       Systemwide
Restaurant count at September 30, 2007                         1,097            2,552            3,649
Opened since September 30, 2007                                   46              102              148
Closed since September 30, 2007                                  (17 )            (45 )            (62 )
Net purchased from (sold by) franchisees since
September 30, 2007                                                47              (47 )              -
Restaurant count at September 28, 2008                         1,173            2,562            3,735

Sales

Our sales, which were generated entirely from our Company-owned restaurants, increased $2.1 million, or 0.7%, to $287.6 million for the three months ended September 28, 2008 from $285.5 million for the three months ended September 30, 2007, primarily due to a $21.9 million increase in sales from the 76 net Company-owned restaurants we added since September 30, 2007, significantly offset by a $19.8 million decrease in sales due to a 7.2% decrease in same-store sales during the 2008 third quarter. Of the 47 net restaurants we acquired from franchisees, 41 are in the California market (the "California Restaurants") and were purchased from a franchisee on January 14, 2008 (the "California Restaurant . . .