Wendy's International (WEN)

Loss From Continuing Operations Before Benefit From Income Taxes and Minority Interests

       Our loss from continuing operations before benefit from income taxes and minority interests decreased $1.5 million to $13.1 million in 2004 from $14.6 million in 2003 due to the effect of the variances explained in the captions above.

       As discussed above, we recognized deferred compensation expense of $3.4 million in 2003 and $2.6 million in 2004, within general and administrative expenses, for the increases in the fair value of investments in the Deferred Compensation Trusts. Under accounting principles generally accepted in the United States of America, we recognize investment income for any interest or dividend income on investments in the Deferred Compensation Trusts and realized gains on sales of investments in the Deferred Compensation Trusts, but are unable to recognize any investment income for unrealized increases in the fair value of the investments in the

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Deferred Compensation Trusts because these investments are accounted for under the cost method of accounting. We recognized net investment income from investments in the Deferred Compensation Trusts of $0.7 million and $2.1 million during 2003 and 2004, respectively, consisting of realized gains from the sale of certain cost-method investments in the Deferred Compensation Trusts of $0.9 million and $2.4 million, respectively, which included increases in value prior to 2003 and 2004 of $0.7 million and $1.8 million, respectively, less investment management fees of $0.2 million and $0.3 million, respectively.