Wendy's International (WEN)

Arby's Restaurants

       Arby's opened its first restaurant in Boardman, Ohio in 1964. As of January 1, 2006, ARG and Arby's franchisees operated Arby's restaurants in 48 states, the District of Columbia and four foreign countries. As of January 1, 2006, the six leading states by number of operating units were: Ohio, with 286 restaurants; Michigan, with 184 restaurants; Indiana, with 175 restaurants; Florida, with 167 restaurants; Texas, with 155 restaurants; and Georgia, with 152 restaurants. The country outside the United States with the most operating units is Canada with 121 restaurants as of January 1, 2006.

       Arby's restaurants in the United States and Canada typically range in size from 2,500 square feet to 3,000 square feet. At January 1, 2006, approximately 98% of freestanding system-wide restaurants (including approximately 99% of freestanding company-owned restaurants) featured drive-thru windows. Restaurants typically have a manager, at least one assistant manager and as many as 30 full and part-time employees. Staffing levels, which vary during the day, tend to be heaviest during the lunch hours.

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       The following table sets forth the number of Arby's restaurants at the beginning and end of each year from 2003 to 2005:

       During the period from December 30, 2002 through January 1, 2006, 316 new Arby's restaurants were opened and 213 (generally underperforming) Arby's restaurants were closed. We believe that closing underperforming Arby's restaurants has contributed to an increase in the average annual unit sales volume of the Arby's system, as well as to an improvement of the overall brand image of Arby's.

       As of January 1, 2006, ARG owned and operated 1,039 domestic Arby's restaurants. Of these 1,039 restaurants, 996 were freestanding units, 28 were in shopping malls, 4 were in convenience stores, 4 were in office buildings/urban in-line, 4 were in travel plazas and 3 were in strip center locations.