Wendy's International (WEN)

Certain Liability Positions Related to Short-Term Investments

Certain liability positions related to short-term investments consisted of the following (in thousands):

Prior to the effective redemption of the Company’s investments in the Opportunities Fund in September 2006, and the DM Fund in December 2006 (see Note 1), the Company entered into (1) securities sold under agreements to repurchase (“Repurchase Agreements”) and (2) debt and equity securities sold with an obligation to purchase (“Short Sales”). Repurchase Agreements are securities sold under agreements to repurchase for fixed

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Triarc Companies, Inc. and Subsidiaries
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—CONTINUED
December 31, 2006

amounts at specified future dates. Short Sales are debt and equity securities not owned at the time of sale that require purchase of the respective debt and equity securities at a future date. The change in the net unrealized gains (losses) on securities sold with an obligation to purchase resulted in gains (losses) of $291,000, $(64,000) and $3,719,000 in 2004, 2005 and 2006, respectively, which are included in “Investment income, net” (see Note 20). Derivatives in liability positions as of January 1, 2006 consisted of certain interest rate swaps, credit default swaps, options on United States government debt securities and foreign currency and a foreign currency forward contract, and as of December 31, 2006, consisted of put and call option combinations and call options on equity securities (see Notes 13 and 14).

Certain Liability Positions Related to Short-Term Investments

       Certain liability positions related to short-term investments consisted of the following (in thousands):

       The Company enters into (1) securities sold under agreements to repurchase (“Repurchase Agreements”), (2) debt and equity securities sold with an obligation to purchase (“Short Sales”) and (3) derivatives which are held in trading portfolios, certain of which were in liability positions, principally in the Opportunities Fund as part of the fund's investment strategy. Repurchase Agreements are securities sold under agreements to repurchase for fixed amounts at specified future dates. Short Sales are debt and equity securities not owned at the time of sale that require purchase of the respective debt and equity securities at a future date. The change in the net unrealized gains (losses) on securities sold with an obligation to purchase resulted in gains (losses) of $(4,578,000), $291,000 and $(64,000) in 2003, 2004 and 2005, respectively, which are included in “Investment income, net” (see Note 19). Derivatives held in trading portfolios in liability positions as of January 2, 2005 consisted of certain futures contracts and credit default swaps, and as of January 1, 2006, consisted of certain interest rate swaps, credit default swaps, options on United States government debt securities and foreign currency and a foreign currency forward contract (see Notes 13 and 14).