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<ACCESSION-NUMBER>0000852772-02-000036
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<CONFORMED-NAME>DENNYS CORP
<CIK>0000852772
<ASSIGNED-SIC>5812
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<FILM-NUMBER>02866109
</FILING-VALUES>
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<STREET1>203 E MAIN ST
<CITY>SPARTANBURG
<STATE>SC
<ZIP>29319
<PHONE>8645978000
</BUSINESS-ADDRESS>
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<STREET1>203 EAST MAIN STREET
<CITY>SPARTANBURG
<STATE>SC
<ZIP>29319
</MAIL-ADDRESS>
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<FORMER-CONFORMED-NAME>TW HOLDINGS INC
<DATE-CHANGED>19920703
</FORMER-COMPANY>
<FORMER-COMPANY>
<FORMER-CONFORMED-NAME>FLAGSTAR COMPANIES INC
<DATE-CHANGED>19930722
</FORMER-COMPANY>
<FORMER-COMPANY>
<FORMER-CONFORMED-NAME>ADVANTICA RESTAURANT GROUP INC
<DATE-CHANGED>19980107
</FORMER-COMPANY>
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<FILENAME>s4.txt
<DESCRIPTION>S-4 DECEMBER 2002  DEBT EXCHANGE
<TEXT>


As filed with the Securities and Exchange Commission on December 23, 2002
                                                     Registration No. 333-




                       SECURITIES AND EXCHANGE COMMISSION
                              Washington, DC 20549
                              -------------------
                                    FORM S-4
                             REGISTRATION STATEMENT
                                      UNDER
                           THE SECURITIES ACT OF 1933
                               -------------------

                               DENNY'S CORPORATION
                (Exact Name of Registrant as Specified in Its Charter)

<TABLE>
<S>               <C>                               <C>                                   <C>
                 Delaware                                      5812                                    13-3487402
      (State or Other Jurisdiction of               (Primary Standard Industrial          (I.R.S. Employer Identification Number)
       Incorporation or Organization)                Classification Code Number)

</TABLE>

                             DENNY'S HOLDINGS, INC.
               (Exact Name of Registrant as Specified in Its Charter)

<TABLE>
<S>   <C>                                           <C>                                    <C>
           New York                                      5812                                    22-3004358
      (State or Other Jurisdiction of                (Primary Standard Industrial          (I.R.S. Employer Identification Number)
       Incorporation or Organization)                Classification Code Number)

</TABLE>

                             203 East Main Street
                        Spartanburg, South Carolina 29319
                                 (864) 597-8000
             (Address, Including Zip Code, and Telephone Number, Including
                 Area Code of Registrant's Principal Executive Offices)
                             Rhonda J. Parish, Esq.
                  Executive Vice President and General Counsel
                               Denny's Corporation
                              203 East Main Street
                     Spartanburg, South Carolina 29319-9966
                                 (864) 597-8000
        (Address, Including Zip Code, and Telephone Number, Including Area
        Codes of Agent For Service)
                                              -
                                 With copies to:
                                Gary C. Ivey, Esq.
                                Alston & Bird LLP
                         Bank Of America Plaza, Suite 4000
                               101 S. Tryon Street
                        Charlotte, North Carolina 28202
                                 (704) 444-1000

     Approximate date of commencement of proposed sale to the public: As soon as
possible after the effective date of this Registration Statement.

     If the securities being registered on this Form are to be offered in
connection with the formation of a holding company and there is compliance with
General Instruction G, please check the following box. [ ]

     If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [ ]

     If this Form is a post-effective amendment filed pursuant to Rule 462(d)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]

<TABLE>
<CAPTION>
                         CALCULATION OF REGISTRATION FEE

===================================================================================================================================

                                                                          Proposed Maximum     Proposed Maximum       Amount of
                                                         Amount to Be    Offering Price Per   Aggregate Offering    Registration
  Title of Each Class of Securities To Be Registered     Registered(1)         Unit(1)              Price(2)            Fee(2)
<S>                                                      <C>             <C>                  <C>                   <C>
             12 3/4% Senior Notes due 2007               $50,000,000           100%              $50,000,000           $4,600
                                                                                                   -----------           ------
===================================================================================================================================
</TABLE>

(1)  Estimated solely for purposes of calculating the registration fee pursuant
     to Rule 457(f)(2) under the Securities Act of 1933, as amended, based upon
     the book value (aggregate outstanding principal amount) of such securities.
(2)  Calculated by multiplying the aggregate offering amount by .000092.

     The Registrant hereby amends this Registration Statement on such date or
dates as may be necessary to delay its effective date until the Registrant shall
file a further amendment which specifically states that this Registration
Statement shall thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933, as amended, or until the Registration Statement
shall become effective on such date as the Securities and Exchange Commission,
acting pursuant to said Section 8(a), may determine.


<PAGE>





                   SUBJECT TO COMPLETION, DATED DECEMBER 23, 2002
PROSPECTUS
                               DENNY'S CORPORATION
                             DENNY'S HOLDINGS, INC.

                                OFFER TO EXCHANGE
                             $50,000,000 REGISTERED
                         12 3/4% SENIOR NOTES DUE 2007
                           OF DENNY'S CORPORATION AND
                             DENNY'S HOLDINGS, INC.
                                       FOR
                      $50,000,000 OUTSTANDING UNREGISTERED
                         12 3/4% SENIOR NOTES DUE 2007
                           OF DENNY'S CORPORATION AND
                             DENNY'S HOLDINGS, INC.

     Denny's Corporation (formerly Advantica Restaurant Group, Inc.) is offering
to exchange up to $50,000,000 aggregate principal amount of 12 3/4% senior notes
due 2007 to be jointly issued by Denny's Corporation and Denny's Holdings, Inc.,
which we refer to as the new notes, for up to $50,000,000 aggregate principal
amount of outstanding 12 3/4% senior notes due 2007 of Denny's Holding and
Denny's Corporation, which we refer to as the old notes. The terms of the new
notes are identical in all respects to the terms of the old notes, except that
the new notes are registered under the Securities Act of 1933, as amended, and
generally are not subject to transfer restrictions or registration rights.

PLEASE CONSIDER THE FOLLOWING REGARDING THE OFFER TO EXCHANGE:

   o        The offer to exchange new notes for old notes will expire at 5:00
            p.m., New York City time, on _________, 2003, unless we extend the
            expiration date. We do not currently intend to extend the
            expiration date.

   o        We will exchange outstanding old notes up to an aggregate principal
            amount of $50,000,000 that are validly tendered and not properly
            withdrawn prior to the expiration date of the exchange offer. You
            should carefully review the procedures for tendering the old notes
            set forth in this prospectus.

   o        We reserve the right to extend, delay, amend or terminate the
            exchange offer.

   o        You may withdraw tendered outstanding old notes at any time prior
            to the expiration of the exchange offer.

   o        We will not receive any proceeds from the exchange offer.

   o        The old notes are not listed, and we do not intend to list the new
            notes, on any securities exchange.

                            -------------------------

     Investing in the new notes involves risks. See "Risk Factors" beginning on
page 10 of this prospectus for a discussion of factors that you should consider
in connection with this exchange offer and an investment in the new notes.

     Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or determined if this
prospectus is accurate or complete. Any representation to the contrary is a
criminal offense.
                            -------------------------

                    The date of this prospectus is _____________, 2002.



<PAGE>





                               -------------------

                                TABLE OF CONTENTS
                                                                           Page

Important Information About This Prospectus..................................ii

Where You Can Find More Information.........................................iii

Forward-Looking Statements...................................................iv

Summary.......................................................................1

Summary Consolidated Financial Data...........................................6

Risk Factors.................................................................10

Use of Proceeds..............................................................17

The Exchange Offer...........................................................17

Description of Indebtedness..................................................24

The New Notes................................................................27

United States Federal Income Tax Consequences................................46

Legal Matters................................................................49

Experts......................................................................49

                            ------------------------

<PAGE>


                   Important Information about this Prospectus

     You should rely only on the information contained in this prospectus or to
which we have referred you. We have not authorized anyone to provide you with
different or additional information. If anyone provides you with different or
additional information, you should not rely on it. You should assume that the
information contained in this prospectus is accurate as of the date on the front
cover of this prospectus. Our business, financial condition, results of
operations and prospects may have changed since then. We are not making an offer
to sell, or soliciting an offer to buy, any of the securities offered by this
prospectus in any jurisdiction where the exchange offer is not permitted.

     We are not making this exchange offer to, and we will not accept surrenders
for exchange from, holders of old notes in any jurisdiction in which this
exchange offer or the acceptance of this exchange offer would violate the
securities or other laws of that jurisdiction.

     Unless the context otherwise requires, as used in this prospectus:

     o  the terms "Denny's," "our" and "we" refer to the combined entities of
        Denny's Corporation and Denny's Holdings, Inc. and their subsidiaries;

     o  the term "old notes" refers to the 12 3/4% notes due 2007 that are not
        registered;

     o  the term "new notes" refers to the 12 3/4% notes due 2007 that we have
        registered under the Securities Act in connection with this exchange
        offer and that we are offering in exchange for the old notes; and;
     o  the term "notes" refers to the old notes and the new notes,
        collectively.

                                       ii
<PAGE>



                       WHERE YOU CAN FIND MORE INFORMATION

     Denny's Corporation is subject to the informational requirements of the
Securities Exchange Act of 1934, as amended, and accordingly files reports,
proxy statements and other information with the Securities and Exchange
Commission, or the SEC. In addition, we have filed with the SEC a registration
statement on Form S-4 under the Securities Act of 1933, as amended, with respect
to the new notes offered in this prospectus. This prospectus does not contain
all of the information set forth in the registration statement and the exhibits
and schedules that are a part of the registration statement. For further
information with respect to us and the new notes, we refer you to the
registration statement and the exhibits and schedules filed or referenced as a
part of the registration statement. Statements contained in this prospectus
concerning the contents of any contract or any other document are not
necessarily complete. If a contract or document is an exhibit to the
registration statement, we refer you to the copy of the contract or document
that has been filed. Each statement in this prospectus relating to a contract or
document filed or referenced as an exhibit is qualified in all respects by the
exhibit. Copies of our reports, proxy statements and other information may be
inspected and copied at the public reference room maintained by the SEC at:

                                    Room 1024
                             450 Fifth Street, N.W.
                             Washington, D.C. 20549

     Information on the operation of the public reference room may be obtained
by calling the SEC at 1-800-SEC-0330. The SEC maintains a website that contains
reports, proxy statements and other information regarding Denny's. The address
of the SEC website is http://www.sec.gov. This information is also available on
our website, the address of which is http://www.dennys.com. Information
contained at our website is not, and should not be deemed to be, a part of this
prospectus.

     The SEC allows us to incorporate by reference information into this
prospectus, which means that we can disclose important information to you by
referring you to another document filed separately with the SEC. The information
incorporated by reference is deemed to be part of this prospectus, except for
information superseded by information contained directly in, or incorporated by
reference in, this prospectus. This prospectus incorporates by reference the
documents set forth below that we previously filed with the SEC and that contain
important information about us:

     o  Annual Report on Form 10-K for the fiscal year ended December 26, 2001;

     o  Quarterly Report on Form 10-Q for the fiscal quarter ended March 27,
        2002;

     o  Quarterly Report on Form 10-Q for the fiscal quarter ended June 26,
        2002;

     o  Quarterly Report on Form 10-Q for the fiscal quarter ended September
        25, 2002; and

     o  Current Reports on Form 8-K dated July 10, 2002, August 12, 2002,
        November 18, 2002 and December 16, 2002.

     Included with this prospectus are copies of our Annual Report on Form 10-K
for the fiscal year ended December 26, 2001 and our Quarterly Report on Form
10-Q for the fiscal quarter ended September 25, 2002.

     In addition, we will provide, without charge, to each person to whom this
prospectus is delivered, upon written or oral request, a copy of any or all of
the foregoing documents (other than exhibits to documents that are not
specifically incorporated by reference to the documents). Please direct such
requests to 203 East Main Street, Spartanburg, South Carolina 29319-9966, (864)
597-8000, Attention: Corporate Secretary.

     If you would like to request documents, please do so by __________, 2003,
in order to receive them before the scheduled expiration of the exchange offer
on __________, 2003.


                                       iii
<PAGE>


                           FORWARD-LOOKING STATEMENTS

     This prospectus contains numerous forward-looking statements about our
financial condition, results of operations, cash flows, financing plans,
business strategies, operating efficiencies, capital and other expenditures,
competitive positions, growth opportunities, plans and objectives of management,
markets for our stock and debt securities and other matters which reflect
management's best judgment based on factors currently known. These
forward-looking statements involve risks and uncertainties. The words
"estimate," "project," "intend," "expect," "believe," "forecast" or similar
expressions, or the negative of these terms or expressions, are intended to
identify these forward-looking statements, but some of these statements use
other phrasing. In addition, any statement in this prospectus that is not a
historical fact is a "forward-looking statement." Except as required by law, we
expressly disclaim any obligation to publicly release any revisions to these
forward-looking statements to reflect events or circumstances after the date of
this prospectus or to reflect the occurrence of unanticipated events. Actual
results could differ materially from those anticipated in these forward-looking
statements as a result of a number of factors including, among others:

     o  competitive pressures from within the restaurant industry;

     o  the level of success of our operating initiatives and advertising and
        promotional efforts, including the initiatives and efforts
        specifically mentioned in this prospectus;

     o  adverse publicity;

     o  changes in business strategy or development plans;

     o  terms and availability of capital;

     o  regional weather conditions;

     o  overall changes in the general economy, particularly at the retail
        level; and

     o  other factors included in the sections containing the forward-looking
        statements, including the section entitled "Risk Factors" in this
        prospectus.


                                       iv

<PAGE>





                                     SUMMARY

     This summary highlights material information from the prospectus. It may
not contain all of the information that is important to you. For a more complete
understanding of our company, the exchange offer and the terms of the new notes,
you should read this entire prospectus and the other documents to which it
refers you.

                                   The Issuers

     Denny's Corporation is the parent company and owner of 100% of Denny's
Holdings, Inc., a holding company that in turn owns 100% of Denny's, Inc., the
operator of almost 1,700 company-owned and franchised restaurants. Prior to
their divestiture in July, 2002, Denny's Corporation also owned and operated the
Coco's and Carrows restaurant chains through our subsidiary FRD Acquisition Co.,
or FRD.

     Our principal executive offices are located at 203 East Main Street,
Spartanburg, South Carolina 29319-9966. Our telephone number is (864) 597-8000.

                             Description of Business

     Denny's is the nation's largest family dining restaurant chain in terms of
market share, number of units and U.S. system-wide sales. At September 25, 2002,
Denny's restaurants operated in 49 states, the District of Columbia, two U.S.
territories and four foreign countries, with concentrations in California (24%
of total restaurants), Florida (11%) and Texas (9%). Of the 1,686 Denny's
restaurants operating at September 25, 2002, 1,109 (66%) were franchised or
licensed units. Our restaurants generally are open 24 hours a day, 7 days a
week. We offer traditional family fare (including breakfast items, hamburgers,
sandwiches, steaks and chicken), and provide both counter and table service.
Our sales are evenly distributed across each of the typical mealtimes; however,
breakfast items account for the majority of our sales. Denny's restaurants are
designed to provide a "dining value" with moderately priced food, friendly and
efficient service and a pleasant atmosphere. We believe that Denny's benefits
from its generally strong market position and consumer recognition.

                                  Risk Factors

         For a discussion of the risks facing our business and the factors that
you should consider in connection with the exchange offer and an investment in
the new notes, see "Risk Factors" beginning on page 10 of this prospectus.

                                       1

<PAGE>


                               The Exchange Offer

Offerors.......................................Denny's Corporation and Denny's
                                               Holdings, Inc.

Exchange Offer
Size...........................................Subject to the terms and
                                               conditions set forth in this
                                               prospectus, Denny's Corporation
                                               and Denny's Holdings, Inc. are
                                               offering to exchange up
                                               to $50.0 million aggregate
                                               principal amount of registered 12
                                               3/4% senior notes due 2007 of
                                               Denny's Corporation and Denny's
                                               Holdings, which we refer to as
                                               the new notes, for up to $50.0
                                               million aggregate principal
                                               amount of unregistered 12 3/4%
                                               senior notes due 2007 of Denny's
                                               Corporation and Denny's Holdings,
                                               which we refer to as the old
                                               notes.

General........................................We are offering to exchange old
                                               notes for a like principal amount
                                               of new notes.  Old notes may be
                                               tendered, and new notes will be
                                               issued, only in integral
                                               multiples of $1,000 principal
                                               amount. Currently, $50.0 million
                                               in principal amount of old
                                               notes is outstanding. See "The
                                               Exchange Offer - Terms Of The
                                               Exchange Offer."

                                               This exchange offer is intended
                                               to satisfy our obligations under
                                               the note exchange and
                                               registration rights agreements
                                               that we entered into when we
                                               issued the old notes. See "The
                                               Exchange Offer - Background and
                                               Purpose of the Exchange Offer."

                                               The terms of the new notes are
                                               identical in all respects to the
                                               terms of the old notes, except
                                               that the new notes are registered
                                               under the Securities Act and
                                               generally are not subject to
                                               transfer restrictions or
                                               registration rights.

Expiration Date;
Extensions; Termination;
Amendments.....................................This exchange offer expires at
                                               5:00 p.m., New York City time,
                                               on _________, 2003, unless the
                                               exchange offer is extended. We
                                               do not currently intend to
                                               extend the expiration date.

                                               Denny's reserves the right to
                                               extend, delay, amend or terminate
                                               the exchange offer. See "The
                                               Exchange Offer - Expiration Date;
                                               Extensions; Termination;
                                               Amendments."

Conditions of the Exchange
Offer..........................................This exchange is subject to
                                               customary conditions, which we
                                               may assert or waive. For more
                                               information about these
                                               conditions, see "The Exchange
                                               Offer - Conditions of the
                                               Exchange Offer."

Resale of New Notes............................We believe that you can resell
                                               and transfer your new notes
                                               without registering them under
                                               the Securities Act and
                                               delivering a prospectus if:

                                               o    you are acquiring the new
                                                    notes in the ordinary
                                                    course of your business for
                                                    investment purposes;

                                               o    you are not engaged in, do
                                                    not intend to engage in and
                                                    have no arrangement or
                                                    understanding with anyone to
                                                    participate in a
                                                    distribution of the new
                                                    notes (within the meaning of
                                                    the Securities Act);

                                               o    you are not a broker-dealer
                                                    who purchased the old notes
                                                    directly from us for resale
                                                    pursuant to Rule 144A or any
                                                    other available exemption
                                                    under the Securities Act;
                                                    and

                                       2

<PAGE>

                                               o    you are not an affiliate of
                                                    Denny's within the meaning
                                                    of Rule 405 under the
                                                    Securities Act.

                                               Our belief is based on
                                               interpretations expressed in some
                                               of the SEC's no-action letters to
                                               other issuers in similar exchange
                                               offers. However, we cannot
                                               guarantee that the SEC would make
                                               a similar decision about this
                                               exchange offer. If our belief is
                                               wrong, or if you cannot
                                               truthfully make the necessary
                                               representations, and you transfer
                                               any new note received in this
                                               exchange offer without meeting
                                               the registration and prospectus
                                               delivery requirements of the
                                               Securities Act or without an
                                               exemption from these
                                               requirements, then you could
                                               incur liability under the
                                               Securities Act. We are not
                                               indemnifying you for any
                                               liability that you may incur
                                               under the Securities Act.

Consequences of Failure to
Exchange Your Old
Notes..........................................Old notes that are not tendered
                                               in the exchange offer or that
                                               are not accepted for exchange
                                               will continue to bear legends
                                               restricting their transfer.  You
                                               will not be able to offer or
                                               sell the old notes unless:

                                               o....each offer or sale is made
                                                    pursuant to an exemption
                                                    from the requirements of
                                                    the Securities Act; or

                                               o....the old notes are
                                                    registered under the
                                                    Securities Act.

                                               After the exchange offer is
                                               closed, we will no longer have
                                               an obligation to register the
                                               old notes. See "The Exchange
                                               Offer - Consequences of Failure
                                               to Exchange Old Notes."

Procedures for Tendering
Old Notes......................................If you wish to tender your old
                                               notes for exchange, you must:

                                               o....complete and sign the
                                                    accompanying letter of
                                                    transmittal;

                                               o    indicate the amount of old
                                                    notes, if less than all, to
                                                    which your election to
                                                    tender for new notes
                                                    applies;

                                               o    have the signature
                                                    guaranteed if required by
                                                    the letter of transmittal;
                                                    and

                                               o    mail or deliver the
                                                    certificates for the old
                                                    notes, together with a
                                                    properly completed and duly
                                                    executed letter of
                                                    transmittal (or a facsimile
                                                    thereof), with any required
                                                    signature guarantees and any
                                                    other required documents, to
                                                    the exchange agent at its
                                                    address shown on the back
                                                    cover page of this
                                                    prospectus on or prior to
                                                    the expiration date.

                                               For more detailed information,
                                               see "The Exchange Offer -
                                               Procedures for Tendering."

Guaranteed Delivery
Procedures.....................................If you wish to tender your old
                                               notes but are not able to deliver
                                               the required documents prior to
                                               the expiration date for the
                                               exchange offer, you may tender
                                               your old notes according to the
                                               guaranteed delivery procedures
                                               set forth in "The Exchange Offer
                                               - Guaranteed Delivery."

Withdrawal Rights..............................You may withdraw tenders of old
                                               notes at any time on or prior
                                               to the expiration date. Any old
                                               notes not accepted for exchange
                                               will be returned to the
                                               tendering holder without cost
                                               promptly after the termination or
                                               expiration

                                       3

<PAGE>

                                               of the exchange offer.
                                               For more information on
                                               withdrawing tenders of old
                                               notes, see "The Exchange Offer -
                                               Withdrawal of Tenders."

Acceptance of Tenders;
Delivery of New Notes..........................Subject to the satisfaction or
                                               waiver of all conditions of the
                                               exchange offer, Denny's will
                                               accept for exchange all old
                                               notes that have been validly
                                               tendered in the exchange offer
                                               and not properly withdrawn on or
                                               prior to the expiration date. We
                                               will issue and deliver the new
                                               notes in exchange for the
                                               applicable old notes accepted
                                               pursuant to the exchange offer
                                               promptly following the
                                               expiration date. See "The
                                               Exchange Offer - Acceptance of
                                               Tenders; Compliance with
                                               Conditions of the Exchange Offer;
                                               Delivery of New Notes."

U.S. Federal Income Tax
Considerations.................................The exchange of old notes for
                                               new notes in this exchange offer
                                               should not be a taxable event
                                               for U.S. federal income tax
                                               purposes. See "United States
                                               Federal Income Tax
                                               Considerations."

Exchange Agent................................ U.S. Bank National
                                               Association is acting as the
                                               exchange agent in the exchange
                                               offer. The address and phone
                                               numbers of the exchange agent are
                                               set forth on the outside back
                                               cover of this prospectus.


                                  The New Notes

Issuers........................................Denny's Corporation and Denny's
                                               Holdings, Inc.

Notes Offered..................................Up to $50.0 million aggregate
                                               principal amount of 123/4%
                                               senior notes due 2007.

Interest Payment Dates.........................Interest on the new notes will
                                               be payable semi-annually in
                                               arrears on each March 31 and
                                               September 30, commencing
                                               March 31, 2003.

Maturity Date..................................September 30, 2007.

Optional Redemption............................Except as provided below, the
                                               new notes may not be redeemed
                                               prior to September 30, 2004. On
                                               and after September 30, 2004,
                                               the new notes will be redeemable,
                                               in whole or in part, at 106.3750%
                                               of their principal amount, at
                                               decreasing amounts thereafter to
                                               and including September 30, 2006,
                                               and thereafter at 100% of their
                                               principal amount, together in
                                               each case with accrued and unpaid
                                               interest. Notwithstanding the
                                               foregoing, from the closing date
                                               until September 30, 2004, the
                                               issuers may redeem up to 35% of
                                               the aggregate principal amount of
                                               new notes, at a redemption price
                                               of 112.75%, plus accrued and
                                               unpaid interest to the redemption
                                               date, from the net proceeds of
                                               any public offering for cash of
                                               certain equity securities of
                                               Denny's Corporation, Denny's
                                               Holdings or any of their
                                               subsidiaries.

Ranking........................................The new notes will be senior
                                               obligations of the issuers and
                                               will rank equal in right of
                                               payment with all other senior
                                               indebtedness of the issuers. The
                                               new notes will be senior to
                                               all existing and future
                                               subordinated indebtedness of the
                                               issuers. However, the new notes
                                               will be effectively
                                               subordinated to the issuers'
                                               secured indebtedness to the
                                               extent of the assets securing
                                               that indebtedness and
                                               structurally subordinated to the
                                               indebtedness and other
                                               obligations of the
                                               issuers' subsidiaries, including
                                               Denny's, Inc. As of September
                                               25, 2002, we had total
                                               indebtedness of approximately
                                               $606.1 million. Of that amount,
                                               $81.2 million, plus trade
                                               payables, would be
                                       4

<PAGE>

                                               structurally senior to the new
                                               notes. See "Capitalization" for
                                               more information.

Covenants......................................The indenture governing the new
                                               notes contains covenants that,
                                               among other things, will limit
                                               our ability to incur additional
                                               indebtedness, pay dividends or
                                               make other distributions, make
                                               loans and investments, enter
                                               into asset sales and use those
                                               proceeds, create liens, enter
                                               into transactions with
                                               affiliates, merge, consolidate
                                               or transfer all or substantially
                                               all of our assets or make
                                               investments in unrestricted
                                               subsidiaries. For additional
                                               information, see "The New Notes -
                                               Certain Covenants."

Change of Control..............................If we experience a change of
                                               control, we must offer to
                                               purchase the new notes at a
                                               purchase price equal to 101% of
                                               the principal amount, plus
                                               accrued and unpaid interest. We
                                               might not be able to pay you the
                                               required price for the new notes
                                               you present to us at the time of
                                               a change of control because our
                                               revolving credit facility or
                                               other indebtedness may prohibit
                                               payment or we might not have
                                               enough funds at the time.  See
                                               "The New Notes - Change Of
                                               Control."

Previously Registered 12 3/4% Notes
due 2007 Outstanding.......................... The new notes will be issued
                                               pursuant to an indenture under
                                               which we already have issued and
                                               outstanding, in addition to
                                               the old notes that are the
                                               subject of this exchange offer,
                                               an aggregate of $70.4 million of
                                               123/4% senior notes due 2007
                                               that have been registered under
                                               the Securities Act. The new
                                               notes will have the same terms
                                               and conditions as these
                                               previously registered
                                               outstanding 123/4% senior notes
                                               due 2007.

Trustee........................................U.S. Bank National Association
                                               will serve as trustee under the
                                               indenture governing the new
                                               notes.


                                       5

<PAGE>




                       SELECTED CONSOLIDATED FINANCIAL DATA

The consolidated balance sheet data as of December 31, 1997, December 30, 1998
and December 29, 1999 and the related statements of consolidated operations and
consolidated cash flow data for the fiscal year ended December 31, 1997, the one
week period ended January 7, 1998, and the fifty-one week period ended December
30, 1998 are derived from our audited consolidated financial statements that are
not included in this prospectus. The consolidated balance sheet data as of
December 27, 2000 and December 26, 2001 and the statements of consolidated
operations and consolidated cash flow data for the fiscal years ended December
29, 1999, December 27, 2000 and December 26, 2001 are derived from our audited
consolidated financial statements that are incorporated by reference into this
prospectus. The consolidated balance sheet data as of September 26, 2001 and
September 25, 2002 and the statements of consolidated operations and
consolidated cash flow data for the three quarters ended September 26, 2001 and
September 25, 2002 are derived from our unaudited consolidated financial
statements that are incorporated by reference into this prospectus. In the
opinion of management, our unaudited interim consolidated financial statements
include all adjustments necessary for a fair presentation of our consolidated
results of operations, cash flows and financial condition for these interim
periods. Excluding impairment and restructuring charges and exit costs, all of
such adjustments are of a normal and recurring nature. The unaudited interim
consolidated results of operations are not necessarily indicative of the
consolidated results of operations for any other interim period or for any
fiscal year as a whole. You should read the selected consolidated financial data
and other information in conjunction with our consolidated financial statements
and the notes thereto and "Management's Discussion and Analysis of Financial
Condition and Results of Operations" incorporated by reference into this
prospectus.


<TABLE>
<CAPTION>
                                   Predecessor Company                           Successor Company(a)
                                -----------------------   -------------------------------------------------------
                                  Fiscal Year  One Week      Fifty-One                   Fiscal Year Ended
                                    Ended       Ended      Weeks Ended   -----------------------------------------
                                December 31, January 7,   December 30,   December 29,  December 27,  December 26,
                                   1997(b)      1998          1998           1999          2000          2001
                                ------------ ----------   ------------   ------------  ------------  ------------
<S>                             <C>          <C>          <C>            <C>           <C>           <C>
 (In millions, except ratios
 and per share amounts)
   Income Statement Data:
   Operating revenue            $  1,193.3   $     23.2   $    1,156.0   $    1,200.2  $    1,155.2  $    1,039.7
   Operating income (loss)(c)         78.2          8.7          (51.2)        (195.9)         (0.3)        (19.7)
   (Loss) income from
     continuing operations(d)        (83.2)       602.9(e)      (126.0)        (275.8)        (82.5)        (88.5)
    Basic (loss) per share
     from continuing
     operations
     applicable to common
     shareholders                    (2.29)       14.21          (3.15)         (6.89)        (2.06)        (2.21)
   Diluted (loss) income per
    share from continuing
    operations applicable to
    common shareholders              (2.29)       10.93          (3.15)         (6.89)        (2.06)        (2.21)
   Cash dividends per common
    per share(f)                        --           --             --             --            --            --
   Ration of earnings to
    fixed charges(g)                    --        268.5x            --             --            --            --
   Deficiency in the
    coverage of
    fixed charges by earnings
    before fixed charges(g)           82.0           --          129.1          275.0          80.7          94.8
 Balance Sheet Data (at end
 of period):
   Current assets(h)            $    129.6                $      291.1   $      379.5  $       56.4  $       40.1
   Working capital
    (deficit)(h)(i)                 (230.2)                      (81.2)        (197.0)       (170.6)       (147.5)
   Net property and equipment        625.8                       630.3          510.9         425.3         362.4
   Total assets                    1,407.4                     1,930.7        1,236.3         745.3         607.3
   Long-term debt, excluding
    current portion                  594.2(j)                  1,141.2          615.4         593.7         645.1
 Other Data:
   EBITDA as defined(k)         $    136.4    $     9.7   $      140.0   $      160.4  $      172.3  $      135.1
   Net cash flows provided by
    (used in) operating               37.0          7.7          (10.7)         (31.1)         (8.4)          8.2
    activities
   Net cash flows (used in)
    provided by investing
    activities(l)                    (41.6)         7.9          180.3           86.7         204.8         (75.1)
   Net cash flows (used in)
    provided by financing
    activities(m)                    (28.4)        (5.3)         (66.6)         (47.9)       (335.0)         46.3

</TABLE>

<TABLE>
<CAPTION>

                                       Successor Company(a)
                                  ---------------------------
                                      Three Quarters Ended
                                 ----------------------------
                                 September 26,  September 25,
                                      2001           2002
                                 -------------  -------------

<S>                              <C>            <C>
 (In millions, except ratios
 and per share amounts)
   Income Statement Data:
   Operating revenue             $       792.8  $       721.7
   Operating income (loss)(c)             (0.8)          47.2
   (Loss) income from
    continuing operations(d)             (49.0)          11.1
   Basic (loss) income per
    share from continuing
    operations
    applicable to common
    shareholders                         (1.22)         (1.68)
   Diluted (loss) income per
    share from continuing
    operations applicable to
    common shareholders                  (1.22)         (1.67)
   Cash dividends per common
    share(f)                                --             --
   Ration of earnings to
    fixed charges(g)                        --            1.1x
   Deficiency in the
    coverage of
    fixed charges by earnings
    before fixed charges(g)               47.7             --
 Balance Sheet Data (at end
 of period):
   Current assets(h)             $        41.4  $        28.5
   Working capital
    (deficit)(h)(i)                     (113.9)        (146.2)
   Net property and equipment            369.7          328.0
   Total assets                          630.1          549.8
   Long-term debt, excluding
    current portion                      661.5          561.7
 Other Data:
   EBITDA as defined(k)          $       108.1  $       113.5
   Net cash flows provided by
    (used in) operating                  (14.4)           2.7
 activities
   Net cash flows (used in)
    provided by investing
    activities(l)                        (63.6)          30.7
   Net cash flows (used in)
    provided by financing
    activities(m)                         54.4          (36.1)

</TABLE>


Certain amounts in all periods presented have been reclassified to conform to
the 2002 presentation.

                                       6
<PAGE>


(a)        Denny's  Corporation's  predecessor,  Flagstar  Companies,  Inc,  or
           FCI,  and  its  wholly  owned  subsidiary  Flagstar Corporation,  or
           Flagstar,  emerged from  bankruptcy on January 7, 1998.  The change
           in ownership of Denny's  Corporation effected by the financial
           restructuring  resulting from the bankruptcy required the
           application of fresh start reporting effective  January 7, 1998 in
           accordance  with the  American  Institute of Certified  Public
           Accountants'  Statement of Position 90-7, or SOP 90-7,  "Financial
           Reporting By Entities in Reorganization Under the Bankruptcy Code."
           All financial statements  subsequent  to January 7, 1998 are
           referred to as "Successor Company" statements, as they reflect
           periods subsequent to the implementation of fresh start reporting
           and are not comparable to the financial  statements for periods
           prior to January 7, 1998.
(b)        Effective January 1, 1997, we changed our fiscal year end from
           December 31 to the last Wednesday of the calendar year. Concurrent
           with this change, we changed to a four-four-five week quarterly
           closing calendar. This reporting schedule generally results in four
           13-week quarters during the fiscal year, for a total of 52 weeks. Due
           to the timing of this change, the fiscal year ended December 31, 1997
           included five additional days of Denny's operations.
(c)        Operating income (loss) reflects impairment and restructuring charges
           and exit costs of $136.5 million, $19.0 million and $30.5 million for
           1999, 2000 and 2001, respectively, and $16.8 million and $4.1 million
           for the three quarters ended September 26, 2001 and September 25,
           2002, respectively.
(d)        We have  classified as  discontinued  operations  restaurant
           subsidiaries  Flagstar  Enterprises,  Inc., or FEI,  (which
           operated our Hardee's restaurants under licenses from Hardee's Food
           Systems),  Quincy's  Restaurants,  Inc., or Quincy's, El Pollo Loco,
           Inc.,  or EPL, and FRD. FEI and Quincy's  were sold in 1998,  and
           EPL was sold in 1999.  We completed the divestiture of FRD on
           July 10, 2002.
(e)        The income from continuing operations for the one week ended January
           7, 1998 includes reorganization items of $582.0 million resulting
           from the application of fresh start reporting in accordance with SOP
           90-7.
(f)        Our bank facilities have prohibited, and our public debt indentures
           have significantly limited, distributions and dividends on our (and
           our predecessors') common equity securities.
(g)        For purposes of computing the ratio of earnings to fixed charges or
           deficiency in the coverage of fixed charges by earnings before fixed
           charges, fixed charges consist of interest expense including
           capitalized interest, amortization of debt expenses and the interest
           element in rental payments under operating leases (estimated to be
           one third of the total rental payments). Earnings consist of income
           from continuing operations before income taxes and fixed charges
           excluding capitalized interest.
(h)        The current assets and working capital deficit amounts presented
           exclude assets held for sale of $347.0 million as of December 31,
           1997, $87.7 million as of December 30, 1998, and net liabilities of
           discontinued operations of $54.0 million as of December 29, 1999,
           $69.4 million as of December 27, 2000, $15.1 million as of December
           26, 2001 and $13.5 million as of September 26, 2001. Assets held for
           sale for 1997 relate to FEI and Quincy's. For 1998, net assets held
           for sale relate to EPL. For 1999, 2000 and 2001, net liabilities of
           discontinued operations relate to FRD. We completed the divestiture
           of FRD on July 10, 2002.
(i)        A negative  working  capital  position is not unusual for a
           restaurant  operating  company.  The decrease in the working
           capital  deficit from  December 31, 1997 to December 30, 1998 is
           attributable  primarily to an increase in cash and cash
           equivalents  from the sales of FEI and Quincy's.  The increase in
           the working  capital  deficit from December 30, 1998 to December 29,
           1999 is attributable  primarily to the reclassification of certain
           mortgage notes to current liabilities and a reduction in cash and
           cash  equivalents  related to acquisitions of restaurants,  the
           retirement of a portion of senior notes and expenditures  related to
           Denny's reimaging  program.  The decrease in working capital deficit
           from December 29, 1999 to December  27, 2000 is  attributable
           primarily  to the increase in Denny's  refranchising  activity in
           2000.  The decrease in the working  capital from  December 27, 2002
           to December 26, 2001 is primarily  related to the use of cash on
           hand and borrowings  under the revolving credit facility to satisfy
           current  liabilities,  the reduction of capital lease
           obligations and the reduction of company owned units from
           refranchising activity and store closures.

                                       7
<PAGE>



(j)        Reflects the reclassification of $1,496.7 million of long-term debt
           to liabilities subject to compromise in accordance with SOP 90-7 as a
           result of the Chapter 11 filing.
(k)        We define "EBITDA" as operating income (loss) before depreciation,
           amortization and charges for impairment and restructuring and exit
           costs as follows:


<TABLE>
<CAPTION>
                                   Predecessor Company                         Successor Company(a)
                                ------------------------   ---------------------------------------------------------
                                 Fiscal Year   One Week     Fifty-One                  Fiscal Year Ended
                                    Ended        Ended     Weeks Ended     -----------------------------------------
                                December 31,  January 7,   December 30,    December 29,   December 27,   December 26,
                                   1997           1998         1998            1999           2000           2001
                                ------------  ----------   ------------    ------------  -------------   ------------
                                <C>           <C>          <C>             <C>           <C>             <C>
                                                                  (In millions)
   Operating income
    (loss)                      $       78.2  $      8.7   $      (51.2)   $     (195.9) $        (0.3)  $      (19.7)
   Total amortization
    and depreciation                    58.2         1.0          191.2           219.8          153.6          124.3
   Total impairment
    and restructuring charges
    and exit costs                         -           -              -           136.5           19.0           30.5
                                ------------  ----------   ------------    ------------  -------------   ------------
   EBITDA as defined            $      136.4  $      9.7   $      140.0    $      160.4  $       172.3         $135.1
                                 ===========  ==========   ============    ============= =============   ============
 </TABLE>


<TABLE>
<CAPTION>
                                         Successor Company(a)
                                   -----------------------------
                                        Three Quarters Ended
                                   -----------------------------
                                   September 26,   September 25,
                                       2001           2002
                                   -------------   -------------
<S>                                <C>             <C>
                                            (In millions)
   Operating income
    (loss)                         $        (0.8)  $        47.2
   Total amortization
    and depreciation                        92.0            62.3
   Total impairment
    and restructuring charges
    and exit costs                          16.9             4.0
                                   -------------   -------------
   EBITDA as defined               $       108.1   $       113.5
                                   =============   =============

 </TABLE>

        We believe that EBITDA as defined is a key internal measure used to
           evaluate the amount of cash flow available for debt repayment and
           funding of additional investments. EBITDA as defined is not a measure
           defined by accounting principles generally accepted in the United
           States of America and should not be considered as an alternative to
           net income or cash flow data prepared in accordance with accounting
           principles generally accepted in the United States of America. Our
           measure of EBITDA as defined may not be comparable to similarly
           titled measures reported by other companies, and although the
           definition of EBITDA in our revolving credit facility differs
           somewhat from the definition of "EBITDA as defined," the amount of
           our EBITDA as defined has been the same as that calculated under the
           revolving credit facility since our emergence from bankruptcy in
           January 1998.
(l)        Net cash flows (used in) provided by investing activities include net
           proceeds of $460.4 million from the disposition of FEI and Quincy's
           in the fifty-one weeks ended December 31, 1998 and net proceeds of
           $109.4 million from the sale of EPL in 1999. For 2000, net cash flows
           from investing activities include $158.7 million of proceeds from the
           maturity of investments securing our in-substance defeased debt (see
           (m) below). For fiscal year 2001, net cash flows used in investing
           activities include $53.3 million of advances to discontinued
           operations. For the three quarters ended September 25, 2002, net cash
           flows from investing activities include $39.4 million of receipts
           from discontinued operations resulting primarily from the divestiture
           of FRD on July 10, 2002.
(m)        Net cash flows (used in) provided by financing activities for 2000
           include the repayment of the $160.0 million principal amount of our
           mortgage notes and the repayment of the $153.3 million principal
           amount of our in-substance defeased debt through the use of the
           proceeds described in (l) above. For fiscal year 2001, net cash flows
           provided by financing activities includes borrowings of $58.7 million
           under our revolving credit facility.

                                       8
<PAGE>



(n)        We adopted Statement of Financial  Accounting  Standard No. 142, or
           SFAS 142, "Goodwill and Other Intangible  Assets," at the beginning
           of fiscal year 2002, and as a result we are no longer amortizing
           reorganization  value, goodwill and trade names.  During the first
           quarter of 2002, we completed  our testing of  intangible  assets
           with  definite  lives and our assessment of impairment of goodwill
           and other intangible  assets with indefinite  lives. We performed an
           impairment test and determined  that none of the recorded  goodwill
           or other  intangible  assets with indefinite  lives was impaired.
           In accordance with SFAS 142,  goodwill and other  intangible  assets
           with indefinite  lives will be tested for impairment at least
           annually,  and more frequently if circumstances  indicate that they
           may be impaired.  We anticipate  performing our annual  impairment
           test during the fourth quarter of each fiscal year.  The following
           table reflects consolidatednoperating results as though we adopted
           SFAS 142 as the beginning of fiscal year 1997:

<TABLE>
<CAPTION>


                              Predecessor Company                          Successor Company(a)
                           -------------------------   ----------------------------------------------------------
                           Fiscal Year    One Week      Fifty-One                    Fiscal Year Ended
                             Ended          Ended      Weeks Ended     ------------------------------------------
                           December 31,   January 7,   December 30,    December 29,   December 27,   December 26,
                             1997           1998           1998            1999           2000           2001
                           ------------   ----------   ------------    ------------   ------------   ------------
  <S>                      <C>            <C>          <C>             <C>            <C>            <C>

                                                          (In millions)
   Reported net
     income (loss)         $  (148.6)     $ 1,394.6     $  (181.4)       $ (381.9)      $ (98.0)       $ (88.5)
   Add back amortization
     of reorganization
     value                        --             --          89.2            88.9          42.1           28.7
   Add back goodwill
     amortization                 --             --           0.2             1.0           1.4            1.6
   Add back  trade
     name amortization            --             --           1.1             1.2           1.2            1.2
                           ------------   ----------   ------------    ------------   ------------   ------------
   Adjusted net
     income (loss)         $  (148.6)     $ 1,394.6     $   (90.9)       $ (290.8)      $ (53.3)       $ (57.0)
                           ============   ==========   ============     ===========   ============   ============

   Reported  basic
     income (loss) per
     share                 $   (3.50)     $   32.87     $   (4.53)       $  (9.54)      $ (2.45)       $ (2.21)
   Add back amortization
     of reorganization
     value                        --             --          2.23            2.22          1.05           0.71
   Add back goodwill
     amortization                 --             --          0.01            0.02          0.04           0.04
   Add back  trade name
     amortization                 --             --          0.03            0.03          0.03           0.03
                           ------------   ----------   ------------    ------------   -----------    ------------
   Adjusted  basic
    income (loss) per
    share                  $   (3.50)     $   32.87     $   (2.26)       $ (7.27)      $  (1.33)       $ (1.43)
                           ============   ==========   ============    ============   ===========    ============

   Reported  diluted
     income (loss) per
     share                 $   (3.50)     $   25.30     $   (4.53)       $ (9.54)      $  (2.45)       $ (2.21)
   Add back amortization
     of reorganization
     value                        --             --          2.23           2.22           1.05           0.71
   Add back goodwill
     amortization                 --             --          0.01           0.02           0.04           0.04
   Add back  trade name
     amortization                 --             --          0.03           0.03           0.03           0.03
                           ------------   ----------   ------------    ------------   -----------    ------------
   Adjusted  diluted
    income (loss) per
    share                  $   (3.50)     $   25.30     $   (2.26)       $ (7.27)      $  (1.33)       $ (1.43)
                           ============   ==========   ============    ============   ===========    ============

</TABLE>


<TABLE>
<CAPTION>

                              Successor Company(a)
                           ----------------------------
                               Three Quarters Ended
                           ----------------------------
                           September 26,  September 27,
                               2001           2002
                           -------------  -------------
<S>                        <C>            <C>

                                (in millions)
   Reported net
     income (loss)         $   (49.0)     $    67.7
   Add back amortization
     of reorganization
     value                      21.8             --
   Add back goodwill
     amortization                1.2             --
   Add back  trade
     name amortization           0.9             --
                           -------------  -------------
   Adjusted net
     income (loss)         $   (25.1)     $    67.7
                           =============  =============
   Reported  basic
     income (loss) per
     share                 $   (1.22)     $    1.68
   Add back amortization
     of reorganization
     value                      0.54             --
   Add back goodwill
     amortization               0.03             --
   Add back  trade name
     amortization               0.02             --
                           -------------  -------------
   Adjusted basic
    income (loss) per
    share                  $   (0.63)     $    1.68
                           =============  =============

   Reported  diluted
     income (loss) per
     share                 $   (1.22)     $    1.67
   Add back amortization
     of reorganization
     value                      0.54             --
   Add back goodwill
     amortization               0.03             --
   Add back  trade name
     amortization               0.02             --
                           -------------  -------------
   Adjusted diluted
    income (loss) per
    share                  $   (0.63)     $    1.67
                           =============  =============

</TABLE>


                                       9
<PAGE>


                                  RISK FACTORS

         You should read and carefully consider the risks described in this
section, as well as the other information contained in this prospectus, before
making a decision to tender your old notes in exchange for new notes in the
exchange offer.

                        Risks Related to Our Indebtedness

Our substantial indebtedness could adversely affect our operations, including
our ability to perform our obligations under the old notes and the new notes.

         We have now and will continue to have a significant amount of
indebtedness. As of September 25, 2002, we had total indebtedness of
approximately $606.1 million, and a shareholders' deficit of $271.8 million.

         Our substantial indebtedness could have important consequences to you.
For example, it could:

         o    make it more difficult for us to satisfy our obligations with
              respect to the old notes and the new notes;

         o    require us to continue to dedicate a substantial portion of our
              cash flow from operations to payments on our indebtedness, which
              would reduce the availability of our cash flow to fund future
              working capital, capital expenditures, acquisitions and other
              general corporate purposes;

         o    increase our vulnerability to general adverse economic and
              industry conditions;

         o    limit our flexibility in planning for, or reacting to, changes in
              our business and the industry in which we operate;

         o    restrict us from making strategic acquisitions or pursuing
              business opportunities;

         o    place us at a competitive disadvantage compared to our
              competitors that have relatively less indebtedness; and

         o    limit, along with the financial and other restrictive covenants
              in our indebtedness, among other things, our ability to borrow
              additional funds. Failing to comply with those covenants could
              result in an event of default which, if not cured or waived, could
              have a material adverse effect on our business, financial
              condition and results of operations.

Despite current indebtedness levels, we may still incur substantially more
indebtedness, including secured indebtedness. Incurring more indebtedness could
intensify the risks described above.

         Subject to the restrictions in our revolving credit facility, the
indenture governing the notes and the indenture governing Denny's Corporation's
11 1/4% senior notes due 2008, or the 11 1/4% notes, we may incur significant
additional indebtedness. Although the terms of the revolving credit facility,
the indenture governing the notes and the indenture governing the 11 1/4% notes
contain restrictions on the incurrence of additional indebtedness, these
restrictions are subject to a number of qualifications and exceptions, and
additional indebtedness incurred in compliance with these restrictions could be
substantial. If new debt is added to our current debt levels, the related risks
that we now face could intensify. As of September 25, 2002, we had $40.0 million
of advances and $52.1 million of letters of credit outstanding under our prior
revolving credit facility, leaving $63.2 million of additional permitted
borrowings available under that facility. As of December 16, 2002, we refinanced
our prior credit facility and entered into a new $125 million credit facility
that expires December 20, 2004. As of December 16, 2002, we had $43.9 million of
advances and $48.8 million of letters of credit outstanding under our revolving
credit facility, leaving $32.3 million of additional permitted borrowings
thereunder.

Your right to receive payment on the notes will be effectively subordinate to
our obligations under the revolving credit facility and structurally subordinate
to the debt of our subsidiaries.

         Our revolving credit facility is secured by a first priority security
interest on the majority of our assets, including the capital stock of our
subsidiaries. Any borrowings under our revolving credit facility or other
secured indebtedness would be

                                       10

<PAGE>

effectively senior to the notes to the extent of the security. In the event of
our liquidation or insolvency, or if any of our secured indebtedness is
accelerated, the secured assets will be first applied to repay our obligations
under our secured indebtedness in full and then to repay our obligations under
our unsecured indebtedness, including under the notes. Accordingly, there may
not be sufficient assets remaining to pay amounts due on any or all of the
notes then outstanding. In addition, borrowings of our subsidiaries, including
Denny's, Inc., whether secured or not and including capital lease obligations
and trade payables, will be structurally senior to the notes.

As holding companies, Denny's Corporation and Denny's Holdings depend on
upstream payments from their operating subsidiaries.

         Denny's Corporation is a holding company that currently conducts its
operations through consolidated subsidiaries, including Denny's Holdings.
Accordingly, Denny's Corporation is dependent upon dividends, loans and other
intercompany transfers from its subsidiaries to meet its debt service and other
obligations. These transfers are subject to contractual restrictions and are
contingent upon the earnings of its subsidiaries. Similarly, Denny's Holdings is
itself a holding company, which conducts its operations through consolidated
subsidiaries. Dividends, loans and other intercompany transfers from
subsidiaries to Denny's Holdings are also subject to contractual restrictions
and are contingent upon the earnings of its subsidiaries. We cannot assure you
that the operating results of our subsidiaries will be sufficient to enable us
to make payments on the notes.

Our ability to generate cash depends on many factors beyond our control, and we
may not be able to generate the cash required to service or repay our
indebtedness.

         Our ability to pay or refinance our indebtedness, including the notes,
will depend upon our future operating performance, which will be affected by
general economic, financial, competitive, legislative, regulatory and other
factors that are beyond our control. Our historical financial results have been,
and our future financial results are expected to be, subject to substantial
fluctuations. We cannot assure you that our business will generate sufficient
cash flow from operations, that currently anticipated revenue growth and
operating improvements will be realized or that future borrowings will be
available to us under our revolving credit facility or any refinancing thereof
in amounts sufficient to enable us to service or reduce our indebtedness,
including the notes, or to fund our other liquidity needs. Our ability to
maintain or increase operating cash flow will depend upon:

         o    consumer tastes;

         o    the success of our marketing initiatives and other efforts by us
              to increase customer traffic in our restaurants; and

         o    prevailing economic conditions and other matters, many of which
              are beyond our control.

         If we are unable to meet our debt service obligations or fund other
liquidity needs, we may need to refinance all or a portion of our indebtedness,
including the notes, on or before maturity or seek additional equity capital. We
cannot assure you that we will be able to pay or refinance our indebtedness or
obtain additional equity capital on commercially reasonable terms, if at all.

Restrictive covenants in our debt instruments restrict or prohibit our ability
to engage in or enter into a variety of transactions, which could adversely
affect us.

         The indenture governing the notes contains various covenants that
limit, among other things, our ability to:

         o    incur additional indebtedness;

         o    pay dividends or make distributions or certain other restricted
              payments;

         o    make certain investments;

         o    create dividend or other payment restrictions affecting
              restricted subsidiaries;

                                       11

<PAGE>

         o    issue or sell capital stock of restricted subsidiaries;

         o    guarantee indebtedness;

         o    enter into transactions with stockholders or affiliates;

         o    create liens;

         o    sell assets and use the proceeds thereof;

         o    engage in sale-leaseback transactions; and

         o    enter into certain mergers and consolidations.

         Our revolving credit facility and the indenture governing our 11 1/4%
notes each contain similar and additional restrictive covenants, including
financial maintenance requirements. These covenants could have an adverse effect
on our business by limiting our ability to take advantage of financing, merger
and acquisition or other corporate opportunities and to fund our operations.

A breach of a covenant in our debt instruments could cause acceleration of a
significant portion of our outstanding indebtedness.

         A breach of a covenant or other provision in any debt instrument
governing our current or future indebtedness could result in a default under
that instrument and, due to cross-default and cross-acceleration provisions,
could result in a default under our other debt instruments. In addition, our
revolving credit facility requires us to maintain certain financial ratios. Our
ability to comply with these covenants may be affected by events beyond our
control, and we cannot assure you that we will be able to comply with these
covenants. Upon the occurrence of an event of default under the revolving credit
facility or any other debt instrument, the lenders could elect to declare all
amounts outstanding to be immediately due and payable and terminate all
commitments to extend further credit. If we were unable to repay those amounts,
the lenders could proceed against the collateral granted to them, if any, to
secure the indebtedness. If the lenders under our current or future indebtedness
accelerate the payment of the indebtedness, we cannot assure you that our assets
would be sufficient to repay in full our outstanding indebtedness, including the
notes.

We may be unable to repurchase the notes and/or 11 1/4% notes upon a change of
control.

         In the event of a "change of control" (as defined in the indenture for
the notes), we must offer to purchase the notes at a purchase price equal to
101% of the principal amount, plus accrued and unpaid interest to the date of
repurchase. See "The New Notes - Change of Control." Denny's Corporation has a
similar obligation under the indenture governing the 11 1/4% notes. In the event
that we are required to make such an offer, there can be no assurance that we
would have sufficient funds available to purchase any notes or 11 1/4% notes,
and we may be required to refinance the notes and/or the 11 1/4% notes. There
can be no assurance that we would be able to accomplish a refinancing or, if a
refinancing were to occur, that it would be accomplished on commercially
reasonable terms.

         Our revolving credit facility prohibits us from repurchasing any notes
or 11 1/4% notes, except under limited circumstances. Our revolving credit
facility also provides that certain change of control events would constitute a
default. In the event a change of control occurs at a time when we are
prohibited from purchasing the notes and/or the 11 1/4% notes, we could seek the
consent of the lenders under the revolving credit facility to purchase the notes
and/or the 11 1/4% notes or we could attempt to refinance the revolving credit
facility. If we did not obtain such a consent or were unable to refinance the
revolving credit facility, we would remain prohibited from purchasing the notes
and/or the 11 1/4% notes. In this case, our failure to purchase would constitute
an event of default under the indentures. The provisions relating to a change of
control included in the indentures may also increase the difficulty of a
potential acquirer from obtaining control of us.


                                       12

<PAGE>


Insolvency proceedings involving Denny's Corporation or Denny's Holdings may
hinder the receipt of payment on the notes.

         An investment in the notes involves insolvency and bankruptcy
considerations that investors should carefully consider. If Denny's Corporation
or Denny's Holdings becomes a debtor subject to insolvency proceedings under the
United States Bankruptcy Code, such circumstances are likely to result in delays
in the payment of the notes and may result in our inability to make payment of
all or a portion of the amounts due under the notes. Provisions of the United
States Bankruptcy Code or general principles of equity that could result in the
impairment of your rights include the automatic stay, avoidance of transfers by
a trustee or debtor-in-possession, substantive consolidation, limitations on the
collectibility of unmatured interest or attorneys' fees, and forced
restructuring of the notes.

         If Denny's Corporation or Denny's Holdings becomes a debtor in a case
under the United States Bankruptcy Code, claims could be made by creditors that
the assets and liabilities of any one of those entities should be substantively
consolidated with those of any other of those entities. If such claims are
successful, the effect could impair the ability of Denny's Corporation and
Denny's Holdings to repay the notes.

         Substantive consolidation is an exception rather than the rule,
especially if one of the companies involved is not in bankruptcy. If Denny's
Corporation or Denny's Holdings becomes a debtor in a case under the United
States Bankruptcy Code, the equitable doctrine of substantive consolidation
could permit a bankruptcy court to disregard the corporate separateness of those
entities and to consolidate and pool their respective assets and liabilities as
though they were held and incurred by one entity. If a court were to order the
substantive consolidation of the assets and liabilities of Denny's Corporation
and Denny's Holdings, the notes would lose their structural seniority over the
11 1/4% notes issued by Denny's Corporation, of which $379.0 million in
aggregate principle amount is currently outstanding. In such event, the holders
of the notes would have the same priority as the holders of the 11 1/4% notes
with respect to the assets of the consolidated entities. The assets of the
substantively consolidated entities may not be sufficient to pay amounts then
due on the notes.


                       Risks Related to the Exchange Offer

If you fail to properly exchange your old notes for new notes, you will continue
to hold old notes subject to transfer restrictions, and the liquidity of the
trading market for any untendered old notes may be substantially limited.

         We will only issue new notes in exchange for old notes that you timely
and properly tender. You should allow sufficient time to ensure timely delivery
of the old notes, and you should carefully follow the instructions on how to
tender your old notes set forth under "The Exchange Offer -- Procedures for
Tendering" and in the letter of transmittal that accompanies this prospectus.
Neither we nor the exchange agent are required to notify you of any defects or
irregularities relating to your tender of old notes.

         If you do not exchange your old notes for new notes in this exchange
offer, the old notes you hold will continue to be subject to the existing
transfer restrictions. In general, you may not offer or sell the old notes
except under an exemption from, or in a transaction not subject to, the
Securities Act and applicable state securities laws. If you continue to hold any
old notes after this exchange offer is completed, you will not have any further
registration rights and you may have trouble selling them because of these
restrictions on transfer. We expect that the liquidity of the market for the old
notes after completion of this exchange offer will be substantially limited.

We expect that there will be only a limited trading market for the new notes, if
any, and you may be unable to sell the new notes or to sell them at a price you
deem sufficient.

         Although the new notes will be registered, we do not intend to list the
new notes on any exchange, and we expect that there will be only a limited
trading market for the new notes, if any. We cannot give you any assurance as
to:

         o    the liquidity of any trading market that currently exists or that
              may develop;

         o    the ability of holders to sell their new notes; or

         o    the price at which holders would be able to sell their new notes.


                                       13

<PAGE>

         Even if a more active trading market develops, the new notes may trade
at higher or lower prices than their principal amount, depending on many
factors, including:

         o    prevailing interest rates;

         o    the number of holders of the new notes;

         o    the interest of securities dealers in making a market for the new
              notes;

         o    the market for similar notes; and

         o    our financial performance.


                          Risks Related to Our Business

The restaurant business is highly competitive.

         The restaurant business is highly competitive and the competition is
expected to increase. If we are unable to compete effectively, our business will
be adversely affected. The following are important aspects of competition:

         o    price;

         o    restaurant location;

         o    food quality;

         o    quality and speed of service;

         o    attractiveness and repair and maintenance of facilities; and

         o    the effectiveness of marketing and advertising programs.

         Our restaurants compete with a wide variety of restaurants ranging from
national and regional restaurant chains to locally owned restaurants. Some of
these competitors have substantially greater financial resources than we do.
There is also active competition for advantageous commercial real estate sites
suitable for restaurants.

Food service businesses may be adversely affected by changes in consumer tastes,
economic conditions and demographic trends.

         Food service businesses are often adversely affected by changes in:

         o    consumer tastes;

         o    national, regional and local economic conditions; and

         o    demographic trends.

         The performance of individual restaurants may be adversely affected by
factors such as:

         o    traffic patterns;

         o    demographic considerations; and

         o    the type, number and location of competing restaurants.


                                       14

<PAGE>

         Multi-unit food service chains such as ours can also be materially and
adversely affected by publicity resulting from:

         o    poor food quality;

         o    illness;

         o    injury; and

         o    other health concerns or operating issues.

         Dependence on frequent deliveries of fresh produce and groceries
subjects food service businesses to the risk that shortages or interruptions in
supply caused by adverse weather or other conditions could adversely affect the
availability, quality and cost of ingredients. In addition, the food service
industry in general and our results of operations and financial condition in
particular also may be adversely affected by unfavorable trends or developments
such as:

         o    inflation;

         o    increased food costs;

         o    labor and employee benefits costs (including increases in hourly
              wage and minimum unemployment tax rates);

         o    regional weather conditions; and

         o    the availability of experienced management and hourly employees.

The locations where we have restaurants may cease to be attractive as
demographic patterns change.

         The success of our owned and franchised restaurants is significantly
influenced by location. Current locations may not continue to be attractive as
demographic patterns change. It is possible that the neighborhood or economic
conditions where our restaurants are located could decline in the future,
potentially resulting in reduced sales in those locations.

Franchising problems could adversely affect our royalty income.

         We have refranchised, and may continue to refranchise, a significant
portion of our company-owned restaurants. This franchising initiative may
ultimately not be successful due to a lack of franchisee interest or changing
economic conditions. In addition, even if our franchising initiative is
successful, there can be no assurance that this decision will prove advantageous
to us from an operational standpoint. The interests of franchisees might
sometimes conflict with our interests. For example, whereas franchisees are
concerned with their individual business strategies and objectives, we are
responsible for ensuring the success of the entire Denny's chain.

         Franchising also presents certain financial risks for us. The family
dining industry is intensely competitive, and some of our franchisees are and
will be highly leveraged. Some of our current franchisees have recently
experienced financial difficulties. Financial problems of our franchisees
adversely affect our royalty income and the value of the Denny's brand.

Numerous government regulations impact our business.

         We and our franchisees are subject to federal, state and local laws and
regulations governing, among other things:

         o    health;

         o    sanitation;

         o    environmental matters;

                                       15

<PAGE>

         o    safety;

         o    the sale of alcoholic beverages; and

         o    hiring and employment practices, including minimum wage laws.

         Restaurant operations also are subject to federal and state laws that
prohibit discrimination and laws regulating the design and operation of
facilities, such as the American With Disabilities Act of 1990. The operation of
our franchisee system also is subject to regulations enacted by a number of
states and rules promulgated by the Federal Trade Commission. If we or our
franchisees fail to comply with these laws and regulations, we could be
subjected to closure, fines, penalties, and litigation, which may be costly. We
cannot predict the effect on our operations, particularly on our relationship
with franchisees, caused by the future enactment of additional legislation
regulating the franchise relationship.

Negative publicity generated by incidents at a few restaurants can adversely
affect the operating results of our entire chain and the Denny's brand.

         Food safety concerns, criminal activity, alleged discrimination or
other operating issues stemming from one restaurant or a limited number of
restaurants do not just impact that particular restaurant or a limited number of
restaurants. Rather, our entire chain of restaurants is at risk from negative
publicity generated by an incident at a single restaurant. This negative
publicity can adversely affect the operating results of our entire chain and the
Denny's brand.

                                       16

<PAGE>


                                 USE OF PROCEEDS

         This exchange offer is intended to satisfy our obligations under the
note exchange and registration rights agreements that we entered into when we
issued the old notes. We will not receive any cash proceeds from this exchange
offer. In exchange for old notes tendered pursuant to this exchange offer, you
will receive new notes in like principal amount. The old notes that are
surrendered in exchange for the new notes will be retired and cancelled by us
upon receipt and cannot be reissued. Accordingly, the issuance of the new notes
under this exchange offer will not result in any change in our outstanding debt.


                               THE EXCHANGE OFFER

Background And Purpose Of The Exchange Offer

         Up to $50 million in aggregate principal amount of new notes will be
exchanged in this exchange offer for up to $50.0 million in aggregate principal
amount of old notes. We issued the old notes without compliance with the
registration requirements of the Securities Act in reliance upon an exemption
from those registration requirements. In connection with the issuance of the old
notes, we entered into note exchange and registration rights agreements with the
holders of the old notes pursuant to which we agreed to file with the SEC, a
registration statement under the Securities Act with respect to the issuance of
new registered notes in an exchange offer. We have filed the form of the note
exchange and registration rights agreement as an exhibit to the registration
statement of which this prospectus is a part.

         Based on interpretations by the staff of the SEC, as set forth in
no-action letters issued to third parties, we believe that the new notes issued
pursuant to this exchange offer may be offered for resale, resold or otherwise
transferred by a holder under U.S. federal securities laws without compliance
with the registration and prospectus deliver requirements of the Securities Act,
provided that:

         o    the holder is acquiring the new notes in the ordinary course of
              business for investment purposes;

         o    the holder is not engaged in, does not intend to engage in and
              has no arrangement or understanding with any person to
              participate in a distribution of the new notes (within the
              meaning of the Securities Act);

         o    the holder is not a broker-dealer who purchased the old notes
              directly from us for resale pursuant to Rule 144A or any other
              available exemption under the Securities Act; and

         o    the holder is not an affiliate of ours within the meaning of Rule
              405 under the Securities Act.

         If you wish to participate in this exchange offer, you must represent
to us in the letter of transmittal that the conditions above have been met.
However, we do not intend to request the SEC to consider, and the SEC has not
considered, this exchange offer in the context of a no-action letter, and we
cannot assure you that the staff of the SEC would make a similar determination
with respect to this exchange offer. Therefore, if you transfer any new note
delivered to you in the exchange offer without delivering a prospectus meeting
the requirements of the Securities Act or without an exemption from registration
of your new notes from such requirements, you may incur liability under the
Securities Act. We do not assume this liability or indemnify you against this
liability, but we do not believe this liability would exist if the above
conditions are met.

     If any holder is an affiliate of ours, or is engaged in or intends to
engage in or has any arrangement or understanding with respect to the
distribution of the new notes, that holder may not participate in this exchange
offer. In addition, this exchange offer is not being made to, nor will we accept
tenders for exchange from, holders of old notes in any jurisdiction in which the
exchange offer or the acceptance of it would not be in compliance with the
securities or blue sky laws of such jurisdiction.

Terms Of The Exchange Offer

         Upon the terms and subject to the conditions of this exchange offer, we
will accept any and all old notes validly tendered prior to 5:00 p.m., New York
time, on the expiration date. We will issue, promptly following acceptance of
validly tendered old notes, up to $50 million in aggregate principal amount of
new notes for a like principal amount of old notes

                                       17

<PAGE>

tendered and accepted in this exchange offer. Holders may tender some or all of
their old notes in connection with this exchange offer, but only in $1,000
increments of principal amount.

         The terms of the new notes are identical in all material respects to
the terms of the old notes, except that the new notes have been registered under
the Securities Act and will be issued free from any transfer restrictions or any
covenant regarding registration. The new notes will evidence the same debt as
the old notes and will be issued under the same indenture and be entitled to the
same benefits under that indenture as the old notes being exchanged. As of the
date of this prospectus, $50.0 million in aggregate principal amount of
unregistered old notes is outstanding.

         The new notes initially will be issued, upon consummation of the
exchange offer, in the form of physical, certificated securities. Immediately
thereafter, at the election of a holder and by notice to U.S. Bank National
Association, as transfer agent, and The Depository Trust Company, or DTC, the
new notes may be re-issued as part of the already outstanding global note issued
under the indenture for the already outstanding $70.4 million of 12 3/4% senior
notes due 2007, which global note is registered in the name of DTC or its
nominee. Thereafter, each beneficial owner's interest in the global note will be
transferable in book-entry form through DTC.

         Holders of old notes do not have any appraisal or dissenters' rights in
connection with this exchange offer. Old notes that are tendered but not
accepted in connection with this exchange offer will remain outstanding and be
entitled to the benefits of the indenture under which they were issued. However,
the registration rights under the note exchange and registration rights
agreement will terminate upon completion of this exchange offer, and holders of
the old notes will not be entitled to any further registration rights under the
note exchange and registration rights agreement.

         We will have accepted validly tendered old notes if and when we have
given oral or written notice to the exchange agent. The exchange agent will act
as agent for the tendering holders for the purpose of receiving the new notes
from us. If any tendered old notes are not accepted for exchange because of an
invalid tender, the occurrence of certain other events described in this
prospectus or otherwise, we will return the old notes, without expense, to the
tendering holder as promptly as possible after the expiration date.

         Holders who tender old notes will not be required to pay brokerage
commissions or fees or, subject to the instructions in the letter of
transmittal, transfer taxes on the exchange of old notes in connection with this
exchange offer. We will pay all charges and expenses, other than certain
applicable taxes described below, in connection with this exchange offer. See
"--Fees and Expenses."

Interest on the New Notes

     Interest on the new notes will accrue at a rate of 12 3/4% per annum from
the most recent date on which interest on the old notes has been paid, or if no
interest has been paid, from the date provided in the indenture governing the
notes.

Expiration Date; Extensions; Termination; Amendments

     The exchange offer will expire at 5:00 p.m., New York City time, on
_______, 2003, subject to extension by us by notice to the exchange agent as
provided in this prospectus. We reserve the right to extend the exchange offer
in our reasonable discretion, in which event the expiration date will be the
latest time and date to which the exchange offer is extended. In order to extend
the expiration date, we will notify the exchange agent of any extension by oral
or written notice and make a public announcement by making a timely release
through an appropriate news agency.

     In addition, we reserve the right, in our discretion:

     o   to delay acceptance of any old notes tendered or to terminate the
         exchange offer and not accept for exchange any old notes by giving oral
         or written notice of such extension or termination to the exchange
         agent; and
     o   to amend the terms of the exchange offer in any manner.

     Any such delay, termination or amendment will be followed as promptly as
practicable by a public announcement. If the exchange offer is amended in a
manner determined by us to constitute a material change, we will promptly
disclose

                                       18

<PAGE>

the amendment in a manner reasonably calculated to inform the holders of old
notes of the amendment and will extend the exchange offer for the minimum
period of time required by applicable law (which in certain instances could be
five or ten business days from the date of such amendment, if the exchange offer
would otherwise expire during this five or ten business day period). The rights
reserved by us in this paragraph are in addition to our rights set forth below
under the caption "-- Conditions of the Exchange Offer."

Conditions of the Exchange Offer

     Notwithstanding any other provision of the exchange offer, we will not be
required to accept for exchange any old notes or issue any new notes and may
terminate the exchange offer if, at any time prior to the expiration of the
exchange offer, we determine, in our reasonable judgment, that any of the
following conditions has not been satisfied prior to or concurrently with the
expiration of the exchange offer:

           o   no action or proceeding has been instituted or threatened or is
               pending in any court or by or before any governmental agency or
               instrumentality, and there has been proposed, adopted or enacted,
               no law, statute, rule or regulation with respect to the exchange
               offer or us that, in our reasonable judgment, has or may have a
               material adverse effect on our business, financial condition,
               operations or prospects or that, in our reasonable judgment,
               impairs the benefits of the exchange offer to us or our ability
               to proceed with the exchange offer;

           o   there shall not have occurred or be likely to occur any event
               that, in our reasonable judgment, has or may have a material
               adverse effect on our business, financial condition,
               operations or profits or impair the benefits of the exchange
               offer to us or our ability to proceed with the exchange offer;
               and

           o    there shall not have occurred:

                (1) any general suspension of or general limitation on
                prices for, or trading in, securities on any national
                securities exchange or in the over-the-counter market;

                (2) any limitation by a governmental agency or authority
                that may adversely affect our ability to complete the
                transactions contemplated by the exchange offer;

                (3) a declaration of a banking moratorium or any suspension of
                payments in respect of banks in the United States or any
                limitation by any governmental agency or authority that
                adversely affects the extension of credit; or

                (4) a commencement of a war, armed hostilities or other
                similar international calamity directly or indirectly involving
                the United States, or, in the case of any of the foregoing
                existing at the time of the commencement of the exchange offer,
                a material acceleration or worsening thereof.

     The foregoing conditions are for our sole benefit and may be asserted by us
regardless of the circumstances giving rise to such conditions. These conditions
may be waived or amended by us in whole or in part at any time and from time to
time prior to expiration of the exchange offer in our reasonable discretion. If
we waive or amend the foregoing conditions, we will, if required by applicable
law, extend the exchange offer for the minimum period of time required by
applicable law (which in certain instances could be five or ten business days)
commencing on the date that we first give notice, by public announcement or
otherwise, of such waiver or amendment, if the exchange offer would otherwise
expire within this time period. Any determination by us concerning the events
described will be final and binding upon all parties.

     In addition, we will not accept for exchange any old notes tendered, and no
new notes will be issued in exchange for any such old notes, if at such time any
stop order shall be threatened or in effect with respect to the registration
statement of which this prospectus forms a part.

                                       19

<PAGE>


Consequences of Failure to Exchange Old Notes

     In the event the exchange offer is completed, we will not be required, and
do not intend, to register the remaining old notes for resale under the
Securities Act or otherwise provide registration rights to the holders thereof.
Remaining old notes will continue to be subject to the following restrictions on
transfer:

           o   the remaining old notes may be resold only if registered
               pursuant to the Securities Act, if any exemption from
               registration is available, or if neither registration nor an
               exemption is required by law; and

           o   the remaining old notes will bear a legend restricting transfer
               in the absence of registration or an exemption.

Procedures for Tendering

     The tender of old notes by a holder pursuant to the procedures set forth
below, upon our acceptance of such tender, will constitute an agreement between
such holder on the one hand and us on the other in accordance with the terms and
subject to the conditions set forth in this prospectus and in the associated
letter of transmittal.

     A holder who wishes to tender old notes for exchange pursuant to the
exchange offer must, on or prior to the expiration date, deliver the
certificates for such old notes in proper form for transfer.

     The registered holder must also deliver a properly completed letter of
transmittal (or a facsimile thereof), duly executed by the registered holder
with any required signature guarantee(s) and any other documents required
thereby, prior to the expiration date of the exchange offer in order for the
tender of old notes to be valid and complete.

     YOU SHOULD SEND LETTERS OF TRANSMITTAL AND OLD NOTES TO THE EXCHANGE AGENT
AND NOT TO DENNY'S CORPORATION, DENNY'S HOLDINGS OR THE TRUSTEE UNDER THE
INDENTURE.

     Signatures on a letter of transmittal or a notice of withdrawal, as the
case may be, must be guaranteed unless the old notes tendered pursuant thereto
are tendered either: o by a registered holder of old notes who has not completed
the boxes entitled "Special Issuance
         Instructions" and "Special Delivery Instructions" on the letter of
transmittal; or o for the account of an eligible guarantor institution.

     In the event that signatures on a letter of transmittal are required to be
guaranteed, such guarantee must be by a firm that is a member of a registered
national securities exchange or a member of the National Association of
Securities Dealers, Inc. or a commercial bank or trust company having an office
in the United States, or an eligible guarantor institution within the meaning of
Rule 17Ad-15 under the Securities Exchange Act of 1934, as amended.

     Holders of old notes whose certificates for such old notes are not
immediately available or who cannot deliver all required documents to the
exchange agent on or prior to the expiration date may tender their old notes
according to the guaranteed delivery procedures set forth below under "-
Guaranteed Delivery."

     The method of delivery of the letter of transmittal, old notes and all
other required documents is at the election and risk of the tendering holders,
and the delivery will be deemed made only when actually received or confirmed by
the exchange agent. If the letter of transmittal, old notes or other required
documents are sent by mail, it is suggested that the mailing be by registered
mail, properly insured, with return receipt requested and made sufficiently in
advance of the expiration date to permit delivery to the exchange agent on or
prior to the expiration date.

     Generally, only a registered holder of old notes may tender old notes in
the exchange offer. If the letter of transmittal is signed by a person other
than the registered holder of the old notes, such old notes must be endorsed or
accompanied by

                                       20

<PAGE>

appropriate bond powers, signed exactly as the name or names of the registered
holder (or registered holders) appear on the old notes. If the letter of
transmittal or any old notes or bond powers are signed by trustees, executors,
administrators, guardians, attorneys-in-fact, officers of corporations or
others acting in a fiduciary or representative capacity, such persons should so
indicate when signing and, unless waived by us, provide evidence satisfactory
to us of their authority to so act.

     Any beneficial owner whose old notes are registered in the name of its
broker, dealer, commercial bank, trust company or other nominee and who wishes
to tender old notes in the exchange offer should contact such registered holder
promptly and instruct such registered holder to tender on its behalf by
completing the form of instructions (including the section regarding eligibility
to participate in the exchange offer) provided by its broker, bank or other
nominee. If a beneficial owner wishes to tend on its own behalf, the beneficial
owner must, prior to completing and executing the letter of transmittal and
delivering its old notes, either make appropriate arrangements to register
ownership of the old notes in such holder's name or obtain a properly completed
bond power from the registered holder. Beneficial owners should be aware that
the transfer of record ownership may take considerable time.

Guaranteed Delivery

     If a holder desires to tender old notes pursuant to the exchange offer and
the certificates for such old notes are not immediately available or time will
not permit all required documents to reach the exchange agent on or prior to the
expiration date, such old notes may nevertheless be tendered, provided that all
of the following guaranteed delivery procedures are complied with:

     (1) such tenders are made by or through an eligible guarantor institution;

     (2) prior to the expiration date, the exchange agent receives from an
         eligible guarantor institution a properly completed and duly executed
         Notice of Guaranteed Delivery, substantially in the form accompanying
         the letter of transmittal, setting forth the name and address of the
         holder of the old notes and the amount of old notes tendered, stating
         that the tender is being made thereby and guaranteeing that, within
         three trading days of the New York Stock Exchange after the date of
         execution of the Notice of Guaranteed Delivery, a properly completed
         and duly executed letter of transmittal and the certificates for all
         physically tendered old notes, in proper form for transfer, and any
         other documents required by the letter of transmittal will be deposited
         by the eligible guarantor institution with the exchange agent. The
         Notice of Guaranteed Delivery may be delivered by hand, or transmitted
         by facsimile or mail to the exchange agent and must include a guarantee
         by an eligible guarantor institution in the form set forth in the
         Notice of Guaranteed Delivery; and

     (3) the certificates representing all tendered old notes, in proper form
         for transfer, together with a properly completed and duly executed
         letter of transmittal, with any required signature guarantees and any
         other documents required by the letter of transmittal, are received by
         the exchange agent within three trading days of the New York Stock
         Exchange after the date of execution of the Notice of Guaranteed
         Delivery.

Withdrawal of Tenders

     Tenders of old notes pursuant to the exchange offer may be properly
withdrawn at any time on or prior to the expiration date. Thereafter, such
tenders may be withdrawn only if the exchange offer is terminated without any
old notes being accepted for exchange.

     If you have tendered old notes, you may withdraw such old notes prior to
the expiration date by delivering a written notice of withdrawal and revocation,
subject to the limitations described in this prospectus. To be effective, a
written notice of withdrawal and revocation must be delivered by hand, overnight
courier, mail or telegraphic or facsimile transmission and must:

           o   be timely received by the exchange agent at its addresses set
               forth on the back cover hereof on or prior to the expiration
               date;

           o   specify the name of the person having tendered the old notes to
               be withdrawn and the principal amount of such old notes to be
               withdrawn;

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<PAGE>

           o   identify the old notes to be withdrawn (including the principal
               amount of such old notes); and

           o   be signed by the holder in the same manner as the original
               signature on the letter of transmittal by which such old notes
               were tendered (including any required signature guarantees).

     If certificates representing old notes to be withdrawn have been delivered
or otherwise identified to the exchange agent, then the name of the registered
holder and the serial numbers of the particular certificate evidencing the old
notes to be withdrawn and a signed notice of withdrawal with signatures
guaranteed by an eligible institution (except in the case of old notes tendered
by an eligible institution for which no signature guarantee will be required)
must also be so furnished to the exchange agent as aforesaid prior to the
physical release of the certificates for the withdrawn old notes. We reserve the
right to contest the validity of any withdrawal or revocation. A purported
withdrawal and revocation which is not received by the exchange agent in a
timely fashion will not be effective.

     Any old notes properly withdrawn will thereafter be deemed not to have been
validly tendered for purposes of the exchange offer and the holder will not
receive any consideration in the exchange offer. Withdrawn old notes may be
re-tendered by again following the appropriate procedures described in this
prospectus at any time on or prior to the expiration date.

Acceptance of Tenders; Compliance with Conditions of the Exchange Offer;
Delivery of New Notes

     Upon the terms and subject to the conditions of the exchange offer, we will
accept for exchange all old notes validly tendered and not properly withdrawn on
or prior to the expiration date. The acceptance for exchange of old notes
validly tendered and not properly withdrawn and the delivery of new notes will
be made as promptly as practicable after the expiration date upon consummation
of the exchange offer. We expressly reserve the right to delay acceptance of any
of the old notes or to terminate the exchange offer and not accept for exchange
and payment any old notes not theretofore accepted if any of the conditions set
forth under the heading "- Conditions of the Exchange Offer" have not been
satisfied or waived. In all cases, the issuance of new notes in exchange for old
notes accepted for exchange pursuant to the exchange offer will be made only
after timely receipt by the exchange agent of old notes, together with a
properly completed and validly executed letter of transmittal (or a facsimile
thereof) with any required signature guarantees and any other documents required
thereby.

     For purposes of the exchange offer, we shall be deemed to have accepted
validly tendered old notes when, as and if we give oral or written notice
thereof to the exchange agent. The exchange agent will act as agent for the
tendering holders of old notes for the purpose of receiving the new notes.

     All questions as to the form of all documents and the validity, eligibility
(including the time of receipt and eligibility under applicable state securities
laws), acceptance and withdrawal of tendered old notes will be determined by us,
in our discretion, which determination shall be final and binding. We expressly
reserve the right to reject any and all tenders not in proper form and to
determine whether the acceptance of or exchange for such tenders would be
unlawful. We also reserve the right, subject to applicable laws, to waive or
amend any of the conditions to the exchange offer or to waive any defect or
irregularity in the tender of any of the old notes. None of Denny's Corporation,
Denny's Holdings, the exchange agent or any other person will be under any duty
to give notification of any defects or irregularities in tenders or will incur
any liability for failure to give any such notification. No tender of old notes
will be deemed to have been validly made until all defects and irregularities
with respect to such old notes have been cured or waived. Any old notes received
by the exchange agent that are not properly tendered and as to which
irregularities have not been cured or waived will be returned by the exchange
agent to the appropriate tendering holder as soon as practicable. Our
interpretation of the terms and conditions of the exchange offer (including the
letter of transmittal and the instructions thereto) will be final and binding on
all parties.

Lost or Missing Certificates

     If you desire to tender old notes pursuant to the exchange offer, but your
old note has been mutilated, lost, stolen or destroyed, you should write to or
telephone the exchange agent at the telephone number or address listed on the
back cover page of this prospectus, concerning the procedures for obtaining
replacement certificates for such old notes, arranging for indemnification or
any other matter with regard to the tender.

                                       22

<PAGE>

Exchange Agent

     U.S. Bank National Association has been appointed as exchange agent for the
exchange offer. Letters of transmittal, notices of guaranteed delivery and all
correspondence in connection with the exchange offer should be sent or delivered
by each holder of old notes or a beneficial owner's broker, dealer, commercial
bank, trust company or other nominee to the exchange agent at the address set
forth on the back cover page of prospectus and associated letter of transmittal.
We will pay the exchange agent reasonable and customary fees for its services
and will reimburse it for its reasonable out-of-pocket expenses in connection
therewith.

Fees and Expenses

     Except as described above, we will not make any payments to brokers,
dealers, or other persons soliciting acceptances of the exchange offer. We will,
however, pay the reasonable and customary fees and out-of-pocket expenses of the
exchange agent, the trustee and legal, accounting and other related fees and
expenses associated with the exchange offer. We will also pay the reasonable
expenses of holders in delivering their old notes to the exchange agent. We will
also pay brokerage houses and other custodians, nominees and fiduciaries the
reasonable out-of-pocket expenses incurred by them in forwarding copies of the
prospectus and related documents to the beneficial owners of the old notes and
in handling or forwarding tenders for exchange.

Transfer Taxes

     We will pay all transfer taxes, if any, applicable to the exchange of old
notes pursuant to the exchange offer. If, however, new notes and/or substitute
old notes for principal amounts not exchanged are to be delivered to, or are to
be registered or issued in the name of, any person other than the registered
holder of the old notes, or if tendered old notes are registered in the name of
any person other than the person signing the letter of transmittal, or if a
transfer tax is imposed for any reason other than the exchange of old notes
pursuant to the exchange offer, the amount of any those transfer taxes (whether
imposed on the registered holder or any other persons) will be payable by the
tendering holder. If satisfactory evidence of payment of such taxes or exemption
therefrom is not submitted, the amount of such transfer taxes will be billed
directly to the tendering holder.

                                       23

<PAGE>


                           DESCRIPTION OF INDEBTEDNESS

     The following summary of the principal terms of our indebtedness does not
purport to be complete and is qualified in its entirety by reference to the
documents governing our indebtedness, including the definitions of certain terms
therein, copies of which are exhibits to the registration statement filed with
the SEC that contains this prospectus or the other documents incorporated by
reference into this prospectus. Whenever particular provisions of these
documents are referred to in this prospectus, such provisions are incorporated
by reference, and the statements are qualified in their entirety by such
reference.

The Revolving Credit Facility

     As of December 16, 2002, our principal operating subsidiary, Denny's, Inc.
and its subsidiary Denny's Realty, Inc. entered into a revolving credit
facility, as borrowers, with JPMorgan Chase Bank and other lenders named
therein, which established a $125.0 million senior secured revolving credit
facility.

     This facility is available for our working capital advances, letters of
credit (up to a $60.0 million sublimit) and general corporate purposes. The
revolving credit facility is guaranteed by Denny's Corporation and Denny's
Holdings and, subject to certain exceptions, by our subsidiaries that are not
borrowers under the revolving credit facility. The credit facility generally is
secured by liens on the stock of our direct and indirect subsidiaries, accounts
receivable, intellectual property and cash and cash accounts (along with
additional liens on our corporate headquarters in Spartanburg, South Carolina).
It is also secured by first-priority mortgages on 246 owned restaurant
properties. The revolving credit facility matures on December 20, 2004.

     The revolving credit facility contains covenants customarily found in
credit agreements for leveraged financings that, among other things, place
limitations on:

           o   dividends on capital stock;

           o   redemptions and repurchases of capital stock;

           o   prepayments, redemptions and repurchases of debt (other than
               loans under the credit agreement);

           o   liens and sale-leaseback transactions;

           o   loans and investments;

           o   incurrence of debt;

           o   capital expenditures;

           o   operating leases;

           o   mergers and acquisitions;

           o   asset sales;

           o   transactions with affiliates;

           o   changes in the business conducted by us and our subsidiaries;
               and

           o   amendment of debt and other material agreements.

     The revolving credit facility also contains covenants that require us, on a
consolidated basis, to meet certain financial ratios and tests described below:

                                       24

<PAGE>

     Consolidated Total Debt Ratio. We are required not to permit the ratio of
(a) total debt outstanding on the last day of any fiscal quarter to (b) EBITDA
(as defined) of the borrowers and the guarantors on a consolidated basis for the
period of four consecutive fiscal quarters then ended, to be more than 6.25:1.00
at March 31, 2003, June 30, 2003, September 30, 2003 and December 31, 2003;
5.90:1.00 at March 31, 2004 and June 30, 2004; and 5.75:1.00 at September 30,
2004. These ratios will be adjusted to reflect the reduction in Consolidated
Total Debt (net of expenses and taxes) resulting from our closing of certain
senior note exchanges permitted by the revolving credit facility.

     Consolidated Senior Secured Debt Ratio. We are required not to permit the
ratio of (a) senior secured debt outstanding on the last day of any fiscal
quarter to (b) EBITDA of the borrowers and the guarantors on a consolidated
basis for the period of four consecutive fiscal quarters then ended, to be more
than 1.50:1.00 from March 31, 2003 and thereafter.

     Consolidated Fixed Charge Coverage Ratio. We are required not to permit the
ratio, determined on the last day of each fiscal quarter for the period of four
consecutive fiscal quarters then ended, of (a) the sum of (1) EBITDA of the
borrowers and the guarantors on a consolidated basis and (2) Consolidated Lease
Expense to (b) the sum of (1) Consolidated Cash Interest Expense (as defined)
and (2) Consolidated Lease Expense (as defined), to be less than 1.25:1.00 on
March 31, 2003, June 30, 2003, September 30, 2003 and December 31, 2003;
1.30:1.00 on March 31, 2004 and June 30, 2004; and 1.35:1.00 on September 30,
2004.

     Consolidated Capital Expenditures; Acquisitions. We are required not to
permit the borrowers and the guarantors on a consolidated basis to incur
Consolidated Capital Expenditures (as defined) or make acquisition of properties
or related assets in excess of $45 million in the aggregate for each of our 2002
and 2003 fiscal years or in excess of $60 million in the aggregate for our 2004
fiscal year, subject in each case to a limited carryover provision providing for
our ability to carryover a portion of any unused amounts from the immediately
preceding fiscal year. Notwithstanding the above, however, not more than $45
million (plus any permitted carryover amount from our 2003 fiscal year) of
Consolidated Capital Expenditures and acquisitions of properties and related
assets during our 2004 fiscal year may be funded from sources other than
permitted indebtedness under the revolving credit facility.

     Minimum Consolidated EBITDA. We are required not to permit the EBITDA of
the borrowers and the guarantors on a consolidated basis for the period of four
consecutive fiscal quarters then ended, to be less than $105 million on March
31, 2003, June 30, 2003 and September 30, 2003; $110 million on December 31,
2003, March 31, 2004 and June 30, 2004; and $115 million on September 30, 2004.

     Events of default under the revolving credit facility include (1) a default
in the payment of principal amounts due thereunder, (2) a default in the payment
of interest and the continuance thereof for three business days, (3) a default
in the observance or performance of financial and other covenants, including,
but not limited, to those described or referred to above (and, in the case of
certain non-financial covenants, the continuance thereof for 10 days), (4) our
failure to pay, when due or payable, principal or interest on our other
indebtedness having a principal amount in excess of $10.0 million or our failure
to observe other terms, covenants, conditions or agreements under such
indebtedness if the effect of such failure is to permit the acceleration of such
indebtedness, (5) certain events of bankruptcy or other similar proceedings, (6)
a money judgment against us in an amount in excess of $5.0 million remaining
undischarged for 30 days or other non-monetary judgment against us reasonably
likely to have a material adverse effect, (7) the lenders' loss of security
interests securing our indebtedness under the revolving credit facility, and (8)
a Change of Control (as defined).

     Upon the occurrence and during the continuance of an event of default, the
lenders may terminate their commitments under the revolving credit facility and
declare amounts outstanding thereunder immediately due and payable, except that
in the case of an event of default referred to in clause (5) above, such
remedies shall become automatically effective.

Public Debt

     On April 15, 2002, we exchanged $88.1 million aggregate principal amount of
Denny's Corporation's 11 1/4% senior notes due 2008, or 11 1/4% Notes, for
approximately $70.4 million aggregate principal amount of 12 3/4% senior notes
due 2007, or 12 3/4% Notes. These 12 3/4% Notes were issued under the same
indenture that governs the old notes and the new notes that are the subject of
the exchange offer. Pursuant to a tack-on provision in that indenture, in a
subsequent series of privately negotiated transactions, we exchanged an
additional $62.5 million of 11 1/4% Notes for the $50.0 million of old notes
that we are offering to exchange pursuant to this prospectus. We now have $379.0
million aggregate principal amount of 11 1/4% Notes outstanding and $120.4
million aggregate principal amount of 12 3/4% Notes.


                                       25

<PAGE>

     Denny's Corporation and Denny's Holdings, Inc. are jointly obligated with
respect to the 12 3/4% Notes. Because only Denny's Corporation is obligated with
respect to the 11 1/4% Notes, the 12 3/4% Notes are structurally senior to the
11 1/4% Notes. The 11 1/4% Notes pay interest on January 15 and July 15 of each
year and will expire on January 7, 2008. The 12 3/4% Notes pay interest on March
31 and September 30 of each year and will expire on September 30, 2007.

                                       26

<PAGE>


                                THE NEW NOTES

     The new notes will be issued under the indenture, dated April 15, 2002,
among Denny's Corporation and Denny's Holdings, as issuers, and U.S. Bank
National Association, as trustee. In this section of the prospectus, the term
"issuers" refers to Denny's Corporation and Denny's Holdings, Inc.; the term
"Denny's Corporation" refers only to Denny's Corporation (formerly Advantica
Restaurant Group, Inc.); and the term "Denny's Holdings" refers only to Denny's
Holdings, Inc. The terms of the new notes will include those stated in the
indenture and those made part of the indenture by reference to the Trust
Indenture Act of 1939 as in effect on the date of the indenture. The new notes
will be subject to all of these terms, and holders of the new notes are referred
to the indenture and the Trust Indenture Act for a statement thereof. The
following is a summary of the material provisions of the indenture. It does not
restate the indenture in its entirety. We urge you to read the indenture because
it, and not this description, defines your rights as a holder of the new notes.
Copies of the indenture and the form of the new notes will be filed as exhibits
to our registration statement filed with the SEC that contains this prospectus.

General

     The new notes will be issued only in registered form without coupons in
denominations of $1,000 or multiples thereof. New notes, in an aggregate
principal amount not to exceed $50 million, the amount permitted to be issued
under the indenture pursuant to this exchange offer, may be executed by the
issuers and delivered to the trustee for authentication, and the trustee will
then authenticate and deliver the new notes to or upon the written order of the
issuers, as provided in the indenture. Principal of, premium, if any, and
interest on the new notes will be payable, and the new notes will be
transferable and exchangeable, at the corporate trust office or agency of the
trustee in The Borough of Manhattan, The City of New York, maintained for such
purposes. In addition, interest may be paid, at the option of the issuers, by
wire transfer or check mailed to the person entitled thereto as shown on the
register for the new notes.

     An aggregate of up to $50.0 million principal amount of new notes is being
offered in the exchange offer. There are currently issued and outstanding under
the indenture $120.4 million in aggregate principal amount of 12 3/4% senior
notes due 2007, which are subject to the same terms and conditions as the new
notes and which consist of (i) the $50 million in aggregate principal amount of
unregistered notes for which the registered new notes are offered in exchange
pursuant to this prospectus and (ii) $70.4 million in aggregate principal amount
of 12 3/4% senior notes due 2007 originally issued under the indenture as of
April 15, 2002, referred to in this section as the "original notes". The
original notes, which will remain outstanding following the completion of this
exchange offer, and the new notes will constitute part of the same series of
securities and will vote together as a series on all matters. Except where the
context otherwise requires, all references to the new notes in this section
includes the original notes.

     The new notes will be senior unsecured obligations of the issuers and will
be equal in right of payment to all Senior Indebtedness of the issuers. Interest
on the new notes will accrue at a rate equal to 12 3/4% per annum, payable in
arrears on each March 31 and September 30, commencing March 31, 2003, until
maturity, to holders of record of new notes at the close of business on each
March 15 and September 15 next preceding the interest payment date. Interest on
the new notes will accrue from the most recent date to which interest has been
paid or, if no interest has been paid, from the date of the indenture. Interest
will be computed on the basis of a 360-day year of twelve 30-day months. The new
notes will mature September 30, 2007.

Optional Redemption

     Except as provided below, the new notes may not be redeemed at the option
of the issuers prior to September 30, 2004. On and after September 30, 2004, the
new notes will be redeemable, in whole or in part, at the option of the issuers,
at the redemption prices (expressed as percentages of the principal amount) set
forth below, plus accrued and unpaid interest, if any, to the redemption date,
if redeemed during the 12-month period beginning on September 30 of the years
indicated below:


                                       27

<PAGE>

     Year                                                            Percentage
     ----                                                            ----------
     2004......................................................       106.3750%
     2005......................................................       103.1875%
     2006 and thereafter.......................................       100.0000%

provided that, if the date fixed for redemption is on an interest payment date,
then the interest payable on such date shall be paid to the holder of record on
the March 15 or September 15 next preceding such interest payment date.
Notwithstanding the foregoing, prior to September 30, 2004, the issuers may
redeem up to 35% of the aggregate principal amount of new notes outstanding on
the date of the indenture at a redemption price (expressed as a percentage of
the principal amount) of 112.75%, plus accrued and unpaid interest, if any, to
the redemption date, from the net proceeds of any Public Offering.

Selection And Notice

     Notice of redemption shall be mailed at least 30 and not more than 60 days
prior to the redemption date to each holder of new notes to be redeemed. In the
event of a redemption of less than all of the new notes, the trustee shall
select, in such manner as it shall deem appropriate and fair, but generally pro
rata or by lot, which new notes shall be redeemed in whole or in part, and shall
promptly notify the issuers in writing of the new notes selected for redemption.
On and after the redemption date, interest ceases to accrue on the new notes or
portions thereof called for redemption and all rights of the holder with respect
to such redeemed new notes, except the right to payment of amounts payable on
such redemption, shall cease.

Certain Definitions

     Set forth below (notwithstanding any other usage of terms in other sections
of this prospectus) is a summary of certain of the defined terms used in the
indenture (except only that we have modified the defined terms and references in
this section to refer to Denny's Corporation by its current name rather than its
former name, Advantica Restaurant Group, Inc.). Reference is made to the
indenture for the full definitions of all terms set forth below and used in such
indenture as well as for any other capitalized terms used in this section for
which no definition is provided.

     "Acquisition Indebtedness" means Indebtedness of any person existing at the
time such person becomes a Subsidiary of an issuer (or at the time such person
is merged with or into a Subsidiary of an issuer), excluding Indebtedness of any
Subsidiary of an issuer incurred in connection with, or in contemplation of,
such person becoming a Subsidiary of such issuer.

     "Adjusted Consolidated Net Worth" means, with respect to any person as of
any date, the Consolidated Net Worth of such person plus (1) the respective
amounts reported on such person's most recent consolidated balance sheet with
respect to any Preferred Stock (other than Disqualified Stock) that by its terms
is not entitled to the payment of dividends unless such dividends may be
declared and paid only out of net earnings in respect of the year of such
declaration and payment, but only to the extent of any cash received by such
person upon issuance of such Preferred Stock or of securities converted into
such Preferred Stock, excluding (2) any amount reflecting any equity adjustment
resulting from a foreign currency translation on a consolidated balance sheet of
such person, but only to the extent not excluded in calculating Consolidated Net
Worth of such person, plus (3) any gain realized upon the sale or other
disposition of any Business Segment to the extent such gains do not exceed the
sum of the aggregate amount of any losses included (on a net after tax basis) in
the computation of Consolidated Net Worth.

     "Affiliate" means, with respect to any person, any other person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such person. For the purposes of this definition, beneficial
ownership of 10% or more of the voting common equity of a person shall be deemed
to be control unless ownership of a lesser amount may be deemed to be control
under the Trust Indenture Act.

     "Asset Segment" means (1) Denny's Holdings, or (2) any Subsidiary, group of
Subsidiaries or group of assets (other than inventory held for sale in the
ordinary course of business) of an issuer or its Subsidiaries which (A) accounts
for at least 20 percent of the total assets of such issuer and its Subsidiaries
on a consolidated basis as of the end of the last fiscal quarter immediately
preceding the date for which such determination is being made or (B) accounts
for at least 20 percent of the income from continuing operations before income
taxes, extraordinary items and cumulative effects of changes in accounting

                                       28

<PAGE>

principles of such issuer and its Subsidiaries on a consolidated basis for the
four full fiscal quarters immediately preceding the date for which such
calculation is being made.

     "Business Segment" means (1) each Significant Subsidiary of an issuer, (2)
the Equity Interests of any of an issuer's Subsidiaries or (3) any group of
assets of an issuer or any of its Subsidiaries, whether now owned or hereafter
acquired; provided, in each case, that the sale (other than the sale of
inventory in the ordinary course of business), lease, conveyance or other
disposition of such Significant Subsidiary, Equity Interests or group of assets,
as the case may be, either in a single transaction or group of related
transactions that are part of a common plan, results in Net Proceeds to such
issuer or any of its Subsidiaries of $50 million or more.

     "Capital Stock" means any and all shares, interests, participations, rights
or other equivalents (however designated) of corporate stock.

     "Cash Equivalents" means (1) securities issued or directly and fully
guaranteed or insured by the United States of America or any agency or
instrumentality thereof (provided that the full faith and credit of the United
States of America is pledged in support thereof), (2) time deposits and
certificates of deposit with a maturity date not more than one year from the
date of acquisition issued by any domestic commercial bank of recognized
standing having capital and surplus in excess of $500 million or a commercial
bank organized under the laws of any other country that is a member of the
Office for Economic Cooperation and Development and having total assets in
excess of $500 million, (3) repurchase obligations with a term of not more than
7 days for underlying securities of the types described in clause (1) above
entered into with any bank meeting the qualifications specified in clause (2)
above, (4) commercial paper issued by the parent corporation of any domestic
commercial bank of recognized standing having capital and surplus in excess of
$500 million and commercial paper issued by others rated at least A-2 or the
equivalent thereof by Standard & Poor's Corporation or at least P-2 or the
equivalent thereof by Moody's Investors Service, Inc. and in each case maturing
within one year after the date of acquisition and (5) investments in money
market funds substantially all of whose assets comprise securities of the types
described in clauses (1) through (4) above.

     "Code" means the Internal Revenue Code of 1986, as it may be amended from
time to time.

     "Consolidated Fixed Charges" means, with respect to any person for a given
period, (1) consolidated interest expense of such person and its consolidated
Subsidiaries to the extent deducted in computing Consolidated Net Income of such
person (including, without limitation, amortization of original issue discount
and non-cash interest payments, all net payments and receipts in respect of
Interest Rate Agreements and the interest component of capital leases, but
excluding deferred financing costs existing immediately after the date of the
indenture and the amortization thereof), plus (2) the amount of all cash
dividend payments on any series of Preferred Stock of such person; provided that
if, during such period, (1) such person or any of its Subsidiaries shall have
made any asset sales (other than, in the case of an issuer and its Subsidiaries,
sales of the Capital Stock of, or any assets of, Unrestricted Subsidiaries),
Consolidated Fixed Charges of such person and its Subsidiaries for such period
shall be reduced by an amount equal to the Consolidated Fixed Charges directly
attributable to the assets that are the subject of such asset sales for such
period and (2) such person or any of its Subsidiaries has made any acquisition
of assets or Capital Stock (occurring by merger or otherwise), including,
without limitation, any acquisition of assets or Capital Stock occurring in
connection with the transaction causing a calculation to be made under the
indenture, Consolidated Fixed Charges of such person and its Subsidiaries shall
be calculated on a pro forma basis as if such acquisition of assets or Capital
Stock (including the incurrence of any Indebtedness in connection with any such
acquisition and the application of the proceeds thereof) took place on the first
day of such period.

     "Consolidated Net Income" means, with respect to any person for a given
period, the aggregate of the Net Income of that person and its Subsidiaries for
such period, on a consolidated basis, determined in accordance with generally
accepted accounting principles; provided that (1) the Net Income of any person
that is not a Subsidiary of that person or is accounted for by the equity method
of accounting shall be included only to the extent of the amount of dividends or
distributions paid to that person and its Subsidiaries, (2) the Net Income of
any person that is a Subsidiary (other than a Subsidiary of which at least 80%
of the Capital Stock having ordinary voting power for the election of directors
or other governing body of such Subsidiary is owned by that person directly or
indirectly through one or more Subsidiaries) shall be included

                                       29

<PAGE>

only to the extent of the lesser of (a) the amount of dividends or
distributions paid to that person and its Subsidiaries and (b) the Net Income
of such person, (3) the Net Income of any person acquired by that person and
its Subsidiaries in a pooling of interests transaction for any period prior to
the date of such acquisition shall be excluded and (4) with respect to an
issuer, the Net Income (if positive) of any person that becomes a Subsidiary of
such issuer after the date of the indenture shall be included only to the
extent that the declaration or payment of dividends on Capital Stock or any
similar distributions, by that Subsidiary to such issuer or to any other
consolidated Subsidiary of such issuer, of such Net Income is at the time
permitted under the terms of its charter and all agreements, instruments,
judgments, decrees, orders, statutes, rules and governmental regulations
binding upon or applicable to that Subsidiary, provided that, if the exclusion
from an otherwise positive Net Income of certain amounts pursuant to this
clause (4) would cause such Net Income to be negative, then such Net Income
shall be deemed to be zero.

     "Consolidated Net Worth" means, with respect to any person at any date of
determination, the sum of the Capital Stock and additional paid-in capital plus
retained earnings (or minus accumulated deficit) of such person and its
Subsidiaries on a consolidated basis, each item to be determined in conformity
with generally accepted accounting principles (excluding the effects of foreign
currency exchange adjustments under Financial Accounting Standards Board
Statement of Financial Accounting Standards No. 52), except that all effects of
the application of Accounting Principles Board Opinions Nos. 16 and 17 and
related interpretations shall be disregarded.

     "Credit Agent" means any person acting as managing agent (or in a similar
capacity) under the Credit Agreement, or any successor thereto; provided that
"Credit Agent" shall also mean any person acting as managing agent (or in a
similar capacity) under any agreement pursuant to which the Credit Agreement is
refunded or refinanced if such person is designated as such by each person that
is at the time of such designation a Credit Agent; and provided further that if
at any time there shall be more than one Credit Agent, then "Credit Agent" shall
mean each such Credit Agent, and any notice, consent or waiver to be given by,
action to be taken by, or notice to be given to, the Credit Agent shall be given
or taken by, or given to, each such Credit Agent.

     "Credit Agreement" means the Credit Agreement, dated as of January 7, 1998,
among Denny's, Inc., El Pollo Loco, Inc., Flagstar Enterprises, Inc., Flagstar
Systems, Inc. and Quincy's Restaurants, Inc., as borrowers, Denny's Corporation
as a guarantor, the lenders named therein, and The Chase Manhattan Bank, as
administrative agent, as amended through and including the date of the
indenture, including any and all related notes, collateral and security
documents, instruments and agreements executed in connection therewith
(including, without limitation, all Loan Documents (as defined in such Credit
Agreement)) and all obligations of Denny's Corporation and its Subsidiaries
incurred thereunder or in respect thereof, and in each case as amended,
supplemented, restructured or otherwise modified, extended or renewed and each
other agreement pursuant to which any or all of the foregoing may be refunded
or refinanced, from time to time.

     "Default" means any event that is, or after notice or passage of time
would be, an Event of Default.

     "Denny's Corporation Group" means Denny's Corporation (formerly Advantica
Restaurant Group, Inc.) and any Subsidiary of Denny's Corporation, other than
Denny's Holdings or any Subsidiary of Denny's Holdings.

     "Denny's Holdings Group" means Denny's Holdings and any Subsidiary of
Denny's Holdings.

     "Disqualified Stock" means any Capital Stock that, by its terms (or by the
terms of any security into which it is convertible or for which it is
exchangeable), or upon the happening of any event, matures or is mandatorly
redeemable, pursuant to a sinking fund obligation or otherwise, or is
redeemable at the option of the holder thereof, in whole or in part, on or
prior to the maturity date of the new notes.

     "EBITDA" means, with respect to any person and its consolidated
Subsidiaries for a given period, the Consolidated Net Income of such person for
such period plus, with respect to an issuer and its consolidated Subsidiaries,
(1) an amount equal to any net loss realized upon the sale or other disposition
of any Business Segment (to the extent such loss was deducted in computing
Consolidated Net Income), (2) any provision for taxes based on income or profits
deducted in computing Consolidated Net Income and any provision for taxes
utilized in computing net loss under clause (1) hereof, (3) consolidated
interest expense (including amortization of original issue discount and non-cash
interest payments, all net payments and receipts in respect of Interest Rate
Agreements and the interest component of capital leases) and (4) depreciation
and amortization (including amortization of goodwill and deferred financing
costs existing immediately after the date of the indenture and other
intangibles) to the extent required under generally accepted accounting
principles, all on a consolidated basis; provided that if, during such period,
(x) such person or any of its Subsidiaries shall have made any asset sales
(other than, in the case of an issuer and its Subsidiaries, sales of the Capital
Stock of, or any assets of, Unrestricted Subsidiaries), EBITDA of such person
and its Subsidiaries for such period shall be reduced by an amount equal to the
EBITDA directly attributable to the assets that are the subject of such asset
sales for such period, and (y) such person or any of its Subsidiaries

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<PAGE>

has made any acquisition of assets or Capital Stock (occurring by merger or
otherwise), including, without limitation, any acquisition of assets or Capital
Stock occurring in connection with the transaction causing a calculation to be
made under the indenture, EBITDA of such person and its Subsidiaries shall be
calculated, excluding any expenses which in the good faith estimate of
management of such person will be eliminated as a result of such acquisition, on
a pro forma basis as if such acquisition of assets or Capital Stock (including
the incurrence of any Indebtedness in connection with any such acquisition and
the application of the proceeds thereof) took place on the first day of such
period.

     "Equity Interests" means Capital Stock or warrants, options or other rights
to acquire Capital Stock (but excluding any debt security that is convertible
into or exchangeable for Capital Stock).

     "Excluded Property" means Denny's Corporation's corporate headquarters
property located in Spartanburg, South Carolina.

     "Existing Indebtedness" means Indebtedness of an issuer or any of its
Subsidiaries existing on the date of the indenture (other than Indebtedness
under the Old Notes and the Credit Agreement).

     "Fixed Charge Coverage Ratio" means, with respect to any person for a given
period, the ratio of the EBITDA of such person for such period to the
Consolidated Fixed Charges of such person for such period.

     "FRD" means FRD Acquisition Co., a Delaware corporation, a wholly owned
subsidiary of Denny's Corporation, and an Unrestricted Subsidiary under the
indenture.

     "FRD Chapter 11Case" means the voluntary petition under Chapter 11 of the
U.S. Bankruptcy Code in the U.S. Bankruptcy Court for the District of Delaware,
Case No. 01 0436 PJW, filed by FRD on February 14, 2002.

     "FRD Investment" means any Investment in FRD by either issuer or any of its
Subsidiaries existing on the date of the indenture.

     "Indebtedness" means, with respect to any person at any date, without
duplication, (1) all obligations of such person for borrowed money, (2) all
obligations of such person evidenced by bonds, debentures, notes or other
similar instruments other than Interest Rate Agreements, (3) all reimbursement
obligations and other liabilities of such person with respect to letters of
credit issued for such person's account, (4) all obligations of such person to
pay the deferred purchase price of property or services, except accounts payable
arising in the ordinary course of business, (5) all obligations of such person
as lessee in respect of capital lease obligations under capital leases and (6)
all obligations of others of a nature described in any of clauses (1) Through
(5) above guaranteed by such person; provided that, in the case of clauses (1)
through (5) above, Indebtedness shall include only obligations reported as
liabilities in the financial statements of such person in accordance with
generally accepted accounting principles.

     "Interest Rate Agreement" means any interest rate protection agreement,
interest rate future, interest rate option, interest rate swap, interest rate
cap or other interest rate hedge arrangement to or under which an issuer or any
of its subsidiaries is or becomes a party or a beneficiary.

     "Investment" means any direct or indirect advance (other than advances to
customers in the ordinary course of business that are recorded as accounts
receivable on the balance sheet of any person or its subsidiaries), loan or
other extension of credit or capital contribution to (by means of any transfer
of cash or other property to others or any payment for property or services for
the account or use of others), or any purchase or acquisition of Equity
Interests, bonds, notes, debentures or other securities issued by, any other
person.

     "Lien" means, with respect to any asset, any mortgage, lien, pledge,
charge, security interest or encumbrance of any kind in respect of such asset,
whether or not filed, recorded or otherwise perfected under applicable law
(including any conditional sale or other title retention agreement, any capital
lease, any option or other agreement to sell and any filing of or agreement to
give any financing statement under the Uniform Commercial Code (or equivalent
statutes) of any jurisdiction).

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<PAGE>

     "Mortgage Financing" means the incurrence by an issuer or any of its
Subsidiaries of any Indebtedness secured by a mortgage or other Lien on real
property acquired or improved by such issuer or any such Subsidiary after the
date of the indenture.

     "Mortgage Financing Proceeds" means, with respect to any Mortgage
Financing, the aggregate amount of cash proceeds received or receivable by an
issuer or any of its Subsidiaries in connection with such financing after
deducting therefrom brokerage commissions, legal fees, finder's fees, closing
costs and other expenses incidental to such Mortgage Financing and the amount of
taxes payable in connection with or as a result of such transaction, to the
extent, but only to the extent, that the amounts so deducted are, at the time of
receipt of such cash, actually paid to a person that is not an Affiliate of such
issuer or its Subsidiaries and are properly attributable to such transaction or
to the asset that is the subject thereof.

     "Mortgage Refinancing" means the incurrence by an issuer or any of its
Subsidiaries of any Indebtedness secured by a mortgage or other Lien on real
property subject to a mortgage or other Lien existing on the date of the
indenture or created or incurred subsequent to the date hereof as permitted
hereby and owned by such issuer or any such Subsidiary.

     "Mortgage Refinancing Proceeds" means, with respect to any Mortgage
Refinancing, the aggregate amount of cash proceeds received or receivable by an
issuer or any of its Subsidiaries in connection with such refinancing after
deducting therefrom the original mortgage amount of the underlying indebtedness
refinanced therewith and brokerage commissions, legal fees, finder's fees,
closing costs and other expenses incidental to such Mortgage Refinancing and the
amount of taxes payable in connection with or as a result of such transaction,
to the extent, but only to the extent, that the amounts so deducted are, at the
time of receipt of such cash, actually paid to a person that is not an Affiliate
of such issuer or its Subsidiaries and are properly attributable to such
transaction or to the asset that is the subject thereof.

     "Net Income" of any person shall mean the net income (loss) of such person,
determined in accordance with generally accepted accounting principles,
excluding, however, (1) with respect to an issuer and its Subsidiaries, any gain
or loss, together with any related provision for taxes on such gain or loss,
realized upon the sale or other disposition (including, without limitation,
dispositions pursuant to sale and leaseback transactions) of a Business Segment,
and (2) any gain or loss realized upon the sale or other disposition by such
person of any capital stock or marketable securities.

     "Net Proceeds" with respect to any Asset Sale, sale and leaseback
transaction or sale or other disposition of a Business Segment, means (1) cash
(freely convertible into U.S. dollars) received by an issuer or any of its
Subsidiaries from such transaction, after (a) provision for all income or other
taxes measured by or resulting from such transaction, (b) payment of all
brokerage commissions and other expenses (including, without limitation, the
payment of principal, premium (if any) and interest on Indebtedness required
(other than pursuant to the provisions described in the first paragraph under
"Certain Covenants- Limitation on Sale of Assets") to be paid as a result of
such transaction) in connection with such transaction and (c) deduction of
appropriate amounts to be provided by an issuer as a reserve, in accordance with
generally accepted accounting principles, against any liabilities associated
with the asset disposed of in such transaction and retained by such issuer or
its Subsidiaries after such sale or other disposition thereof, including,
without limitation, pension and other post-employment benefit liabilities and
liabilities related to environmental matters or against any indemnification
obligations associated with such transaction and (2) promissory notes received
by an issuer or any of its Subsidiaries in connection with such transaction upon
the liquidation or conversion of such notes into cash.

     "Obligations" means, with respect to any Indebtedness or any Interest Rate
Agreement, any principal, premium, interest (including, without limitation,
interest, whether or not allowed, after the filing of a petition initiating
certain bankruptcy proceedings), penalties, commissions, charges, expenses,
fees, indemnifications, reimbursements and other liabilities or amounts payable
under or in respect of the documentation governing such Indebtedness or such
Interest Rate Agreement.

     "Old Notes" means any outstanding 11 1/4% senior notes due 2008 of Denny's
Corporation issued pursuant to that certain indenture, dated as of January 7,
1998, by and between Denny's Corporation and U.S. Bank National Association
(formerly, First Trust National Association), as Trustee..

     "Permitted Investments" means (1) Investments in cash (including major
foreign currency or currency of a country in which an issuer or any of its
Subsidiaries has operations) or Cash Equivalents, (2) with respect to each
issuer and its Subsidiaries, Investments that are in persons at least a majority
of whose revenues are derived from food service operations, ancillary operations
or related activities and that have the purpose of furthering the food service
operations of such issuer or any of its Subsidiaries (other than any Investment
by any of the Denny's Holdings Group in any of the Denny's Corporation Group),
(3) advances to employees of Denny's Corporation

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<PAGE>

or its Subsidiaries not in excess of $5 million in the aggregate at any one
time outstanding, (4) accounts receivable created or acquired in the ordinary
course of business, (5) obligations or shares of stock received in connection
with any good faith settlement or bankruptcy proceeding involving a claim
relating to a Permitted Investment, (6) evidences of Indebtedness, obligations
or other Investments not exceeding $5 million in the aggregate held at any one
time by Denny's Corporation or any of its Subsidiaries and (7) currency swap
agreements and other similar agreements designed to hedge against fluctuations
in foreign exchange rates entered into in the ordinary course of business in
connection with the operation of the business.

     "Permitted Payments to Denny's Corporation" means, without duplication,
payments by any Subsidiary of Denny's Corporation to Denny's Corporation in an
amount sufficient to enable Denny's Corporation to (a) pay reasonable and
necessary operating expenses and other general corporate expenses of Denny's
Corporation and its subsidiaries, (b) pay foreign, federal, state and local tax
liabilities of Denny's Corporation and its current and former subsidiaries to
the extent that Denny's Corporation has an obligation to pay such tax
liabilities, the determination of which shall take into account any operating
losses, net operating loss carryovers, and other tax attributes available to
Denny's Corporation and its subsidiaries, (c) pay, as and when the same becomes
due and payable, interest on the Old Notes, (d) pay, as and when the same
becomes due and payable, (i) interest and (ii) principal at maturity (or as
otherwise required pursuant to contractually scheduled principal payments,
which, in the case of Existing Indebtedness are existing on the date of the
indenture, and, in the case of Indebtedness incurred after the date of the
indenture are existing on the date such Indebtedness is incurred), in each case
on the Credit Agreement, any Existing Indebtedness and on any other Indebtedness
incurred after the date of the indenture that was permitted to be incurred in
accordance with the covenant "Limitation on Additional Indebtedness and Issuance
of Disqualified Capital Stock" and (e) repurchase, redeem or otherwise acquire
or retire for value, Equity Interests in Denny's Corporation in accordance with
clause (3) of, and the Old Notes in accordance with clause (8) of, the covenant
"Limitation on Restricted Payments." Notwithstanding anything herein to the
contrary, any such payments made to Denny's Corporation pursuant hereto shall
either be used by Denny's Corporation for the purpose such payment was made to
Denny's Corporation within 90 days of Denny's Corporation's receipt of such
payment or refunded to the party from whom Denny's Corporation received such
payment; provided, however, that to the extent that any such payments have not
been paid within such 90 day period, Denny's Corporation shall be entitled to
retain an amount that shall not at any time exceed an aggregate of $250,000 for
the purpose of making the payments described herein.

     "Preferred Stock" means, with respect to any person, any and all shares,
interests, participations or other equivalents (however designated) of such
persons' stock which is preferred or has a preference with respect to the
payment of dividends, or as to distributions upon any dissolution or liquidation
over Equity Interests of any other class of such person whether now outstanding
or issued after the date of the indenture.

     "Public Offering" means any underwritten public offering for cash pursuant
to a registration statement filed with the Commission in accordance with the
Securities Act of Capital Stock other than Disqualified Stock of Denny's
Corporation or any of its Subsidiaries.

     "Restricted Investments" means (a) any Investment by any of the (i) Denny's
Corporation Group in any person that is not a wholly owned Subsidiary of Denny's
Corporation and (ii) Denny's Holdings Group in any person that is not a wholly
owned Subsidiary of Denny's Holdings, or (b) other transfers of assets by any of
the (i) Denny's Corporation Group to any Subsidiary or Affiliate of Denny's
Corporation that is not a wholly owned Subsidiary of Denny's Corporation or (ii)
Denny's Holdings Group to any Subsidiary or Affiliate of Denny's Holdings that
is not a wholly owned Subsidiary of Denny's Holdings (other than any such other
transfers of assets described in clause (b) above in transactions the terms of
which are fair and reasonable to the transferor and are at least as favorable as
the terms that could be obtained by the transferor in a comparable transaction
made on an arms' length basis between unaffiliated parties, as conclusively
determined, for any such transfer involving aggregate consideration in excess of
$5 million, by a majority of the directors of Denny's Corporation or Denny's
Holdings, as applicable, that are unaffiliated with the transferee or, if there
are no such directors, by a majority of the directors of Denny's Corporation or
Denny's Holdings, as applicable), except in each case for Permitted Investments
and any such Investments existing on the date of the indenture.

     "Senior Indebtedness" means (1) all obligations of an issuer and its
Subsidiaries now or hereafter existing under or in respect of the Credit
Agreement, the Old Notes, and the new notes, whether for principal, interest
(including, without limitation, interest accruing after the filing of a petition
initiating any bankruptcy, insolvency or similar proceeding, whether or not such
interest is an allowable claim under such proceeding), penalties, commissions,
charges, indemnifications, liabilities, reimbursement obligations in respect of
letters of credit, fees, expenses or other amounts payable under or in

                                       33

<PAGE>


respect of the Credit Agreement, the Old Notes and the new notes and all
obligations and claims related thereto, (2) all Obligations of an issuer in
respect of Interest Rate Agreements and (3) additional Indebtedness permitted
by the covenant "Limitation on Additional Indebtedness and Issuance of
Disqualified Stock" (other than pursuant to clause (3) of the third paragraph
thereof) which is not expressly by its terms subordinated to the new notes and
all Obligations and claims related thereto; provided, that Senior Indebtedness
shall not include (x) any Indebtedness of an issuer to any of its Subsidiaries
or (y) Indebtedness incurred for the purchase of goods or services (other than
services provided by the Credit Agent in connection with the Credit Agreement
or any other party to an agreement evidencing Senior Indebtedness in connection
with such agreement) obtained in the ordinary course of business. "Senior
Indebtedness" under or in respect of the Credit Agreement, the Old Notes and
the new notes shall continue to constitute Senior Indebtedness for all purposes
of the indenture notwithstanding that such Senior Indebtedness or any
obligations or claims in respect thereof may be disallowed, avoided or
subordinated pursuant to any Bankruptcy Law or other applicable insolvency law
or equitable principles.

     "Significant Subsidiary" means any Subsidiary of an issuer that would be a
"significant subsidiary" as defined in Rule 1-02 of Regulation S-X under the
Securities Act and the Exchange Act (as such Regulation is in effect on the date
of the in denture) (excluding, except for the purposes of determining an Event
of Default, subparagraph (c) of Rule 1-02 of Regulation S-X).

     "Subsidiary" of any person means any entity of which shares of the Capital
Stock or other Equity Interests (including partnership interests) entitled to
cast at least a majority of the votes that may be cast by all shares or Equity
Interests having ordinary voting power for the election of directors or other
governing body of such entity are owned by such person directly and/or through
one or more Subsidiaries of such person; provided that each Unrestricted
Subsidiary shall be excluded from the definition of "Subsidiary."

     "Unrestricted Subsidiary" means (1) FRD, (2) any subsidiary of an issuer
that at the time of determination is an Unrestricted Subsidiary (as designated
by such issuer's board of directors, as provided below) and (3) any subsidiary
of an Unrestricted Subsidiary. The board of directors of such issuer may
designate any subsidiary of an issuer (including any Subsidiary and any newly
acquired or newly formed subsidiary) to be an Unrestricted Subsidiary unless
such subsidiary owns any Capital Stock of, or owns, or holds any lien on, any
property of, any Subsidiary of such issuer (other than any subsidiary of the
subsidiary to be so designated); provided that (a) any Unrestricted Subsidiary
must be an entity of which shares of the Capital Stock or other Equity Interests
(including partnership interests) entitled to cast at least a majority of the
votes that may be cast by all shares or Equity Interests having ordinary voting
power for the election of directors or other governing body are owned, directly
or indirectly, by such issuer (b) such issuer certifies that such designation
complies with the covenants described under "Certain Covenants- Limitation on
Restricted Payments" and "Investments in Unrestricted Subsidiaries" and (c) each
of (1) the subsidiary to be so designated and (2) its subsidiaries have not at
the time of designation, and do not thereafter, create, incur, issue, assume,
guarantee or otherwise become directly or indirectly liable with respect to any
Indebtedness pursuant to which the lender has recourse to any of the assets of
such issuer or any of its Subsidiaries. The board of directors of such issuer
may designate any Unrestricted Subsidiary to be a Subsidiary; provided that,
immediately after giving effect to such designation, Denny's Corporation could
incur at least $1 of additional Indebtedness pursuant to the Fixed Charge
Coverage Ratio test described under "Certain Covenants - Limitation on
Additional Indebtedness and Issuance of Disqualified Stock" on a pro forma basis
taking into account such designation.

     "Weighted Average Life to Maturity" means, when applied to any Indebtedness
at any date, the number of years obtained by dividing (1) the then outstanding
aggregate principal amount of such Indebtedness into (2) the total of the
product obtained by multiplying (a) the amount of each then remaining
installment, sinking fund, serial maturity or other required payment of
principal, including payment at final maturity, in respect thereof, by (b) the
number of years (calculated to the nearest one-twelfth) which will elapse
between such date and the making of such payment.

Certain Covenants

     Limitation on Restricted Payments. The indenture provides that each issuer
will not, and will not permit any of its Subsidiaries to, directly or
indirectly:

         (1) declare or pay any dividend or make any distribution on account of
     the Capital Stock or other Equity Interests of such issuer or any
     Subsidiary of Denny's Corporation or Denny's Holdings ((A) other than
     dividends or distributions payable in Equity Interests (other than
     Disqualified Stock) of such issuer or such Subsidiary and (B) other than
     dividends or distributions payable by a Subsidiary (other than dividends or
     distributions payable by any of the Denny's Holdings

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<PAGE>


     Group to any of the Denny's Corporation Group) so long as, in the case of
     any dividend of distribution payable on any class or series of securities
     issued by a Subsidiary other than a wholly owned Subsidiary, such issuer
     or a Subsidiary of such issuer receives at least its pro rata share of such
     dividend or distribution in accordance with its Equity Interest in such
     class or series of securities);

         (2) purchase, redeem or otherwise acquire or retire for value any
     Equity Interests of such issuer or any Subsidiary of Denny's Corporation or
     Denny's Holdings (other than any such Equity Interests (i) owned by Denny's
     Corporation or any of its Subsidiaries so purchased, redeemed or otherwise
     acquired or retired for value by any of the Denny's Corporation Group and
     (ii) owned by any of the Denny's Holdings Group so purchased, redeemed or
     otherwise acquired or retired for value by any of the Denny's Holdings
     Group);

         (3) voluntarily prepay any Old Notes or any Indebtedness that is
     subordinated to the new notes other than in connection with any (a)
     refinancing of such Indebtedness specifically permitted by the terms of the
     indenture, (b) Indebtedness between (i) Denny's Corporation and any of its
     Subsidiaries in the Denny's Corporation Group or between Subsidiaries in
     the Denny's Corporation Group, (ii) Denny's Holdings and any of its
     Subsidiaries in the Denny's Holdings Group or between Subsidiaries in the
     Denny's Holdings Group or (c) Indebtedness of any of the Denny's
     Corporation Group to any of the Denny's Holdings Group; or

         (4) make any Restricted Investments (other than an Investment in any
     Unrestricted Subsidiary)

(all such dividends, distributions, purchases, redemptions or other
acquisitions, retirements, prepayments or Restricted Investments being
collectively referred to as "Restricted Payments"), if, at the time of such
Restricted Payment:

              (a) a Default or Event of Default shall have occurred and be
         continuing or shall occur as a consequence thereof;

              (b) immediately after such Restricted Payment and after giving
         effect thereto on a pro forma basis, Denny's Corporation would not be
         able to incur $1 of additional Indebtedness pursuant to the Fixed
         Charge Coverage Ratio test described under "Limitation on Additional
         Indebtedness and Issuance of Disqualified Stock" below; or

              (c) such Restricted Payment, without duplication, together with
         (A) the aggregate of all other Restricted Payments (in each case
         valued, where other than cash, at their fair market value as of the
         date such Restricted Payment is made) made after the date of the
         indenture and (B) the amount by which the aggregate of all then
         outstanding Investments in Unrestricted Subsidiaries (other than the
         FRD Investment), calculated without giving effect to amounts included
         pursuant to clause (z)(2) below, exceeds $25 million, is greater than
         the sum of, without duplication: (v) 50% of the aggregate Consolidated
         Net Income of Denny's Holdings for the period (taken as one accounting
         period) from the beginning of the first quarter immediately after the
         date of the indenture to the end of its most recently ended fiscal
         quarter at the time of such Restricted Payment; provided that if such
         Consolidated Net Income for such period is less than zero, then minus
         100% of the amount of such loss, plus (w) 100% of the aggregate
         amortization of goodwill and of excess reorganization value for the
         period specified in clause (v) above, plus (x) 100% of the aggregate
         net cash proceeds and the fair market value of marketable securities
         received by Denny's Holdings from the issue or sale, after the date of
         the indenture, of Capital Stock of Denny's Holdings (other than Capital
         Stock issued and sold to a Subsidiary of Denny's Holdings and other
         than Disqualified Stock), or any Indebtedness or other security
         convertible into any such Capital Stock that has been so converted plus
         (y) 100% of the aggregate amounts contributed to the capital of Denny's
         Holdings after the date of the indenture plus (z) 100% of the aggregate
         amounts received in cash and the fair market value of marketable
         securities (other than Restricted Investments) received from (1) the
         sale or other disposition of Restricted Investments made after the date
         of the indenture by Denny's Holdings and its Subsidiaries or (2) the
         sale of the stock of an Unrestricted Subsidiary or the sale of all or
         substantially all of the assets of an Unrestricted Subsidiary to the
         extent that a liquidating dividend is paid to Denny's Holdings or any
         Subsidiary of Denny's Holdings from the proceeds of such sale (in each
         case, other than to the extent of the FRD Investment and only to the
         extent that such amounts were not applied to reduce the aggregate
         amount of all outstanding Investments in Unrestricted Subsidiaries for
         purposes of calculating the aggregate amount of all such Investments in
         (B) above); provided, that no such amounts shall be included pursuant
         to clause (x) or (y) above to the extent that the proceeds (including
         by exchange) from any such issuance, sale or contribution were used as
         provided in clause (2), (4) or (5) in the next succeeding paragraph.
         For purposes of this

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<PAGE>

         clause (c), the fair market value of property other than cash shall be
         conclusively determined in good faith by the board of directors of
         Denny's Holdings.

     Notwithstanding the foregoing, the indenture permits:

         (1) the payment of any dividend within 60 days after the date of
     declaration thereof, if at said date of declaration such payment would have
     complied with the provisions of the indenture;

         (2) the retirement of any shares of Capital Stock of an issuer in
     exchange for, or out of the net proceeds of the substantially concurrent
     sale (other than to a Subsidiary of such issuer) of, other shares of such
     issuer's Capital Stock, other than any Disqualified Stock;

         (3) payments for the repurchase, redemption or other acquisition or
     retirement for value of any Equity Interests in Denny's Corporation issued
     to members of management of Denny's Corporation and its Subsidiaries
     pursuant to subscription and option agreements in effect on the date of the
     indenture and Equity Interests in Denny's Corporation issued to future
     members of management pursuant to subscription agreements executed
     subsequent to the date of the indenture, containing provisions for the
     repurchase of such Equity Interests upon death, disability or termination
     of employment of such persons which are substantially identical to those
     contained in the subscription agreements in effect on the date of the
     indenture; provided that the amount of such dividends or distributions,
     after the date of the indenture, in the aggregate will not exceed the sum
     of (A) $5 million plus (B) the cash proceeds from any reissuance of such
     Equity Interests by Denny's Corporation to members of management of Denny's
     Corporation and its Subsidiaries;

         (4) the repurchase, redemption or other acquisition or retirement for
     value of any Indebtedness of an issuer that is subordinated in right of
     payment to the new notes in exchange for or with the proceeds of the
     issuance of shares of such issuer's Equity Interests (other than
     Disqualified Stock);

         (5) the redemption, repurchase or retirement for value of any
     Indebtedness of an issuer that is subordinated to the new notes (A) with
     the proceeds of, or in exchange for, Indebtedness incurred pursuant to
     clause (2) of the third paragraph under "Limitation on Additional
     Indebtedness and Issuance of Disqualified Stock" below or (B) if, after
     giving effect to such redemption, repurchase or retirement, Denny's
     Corporation could incur at least $1 of additional Indebtedness pursuant to
     the Fixed Charge Coverage Ratio test described under "Limitation on
     Additional Indebtedness and Issuance of Disqualified Stock" below;

         (6) the purchase, redemption or other acquisition or retirement for
     value of Equity Interests of any Subsidiary of Denny's Corporation (other
     than any such Equity Interests (i) owned by Denny's Corporation or any of
     its Subsidiaries so purchased, redeemed or otherwise acquired or retired
     for value by any of the Denny's Corporation Group and (ii) owned by any of
     the Denny's Holdings Group so purchased, redeemed or otherwise acquired or
     retired for value by any of the Denny's Holdings Group) in an aggregate
     cumulative amount not to exceed $5 million annually;

         (7)      so long as no Default or Event of Default shall have occurred
     and be continuing, Permitted Payments to Denny's Corporation; and

         (8) after the date on which a bankruptcy court enters an order closing
     the FRD Chapter 11 Case, the repurchase, redemption or other acquisition or
     retirement for value of Old Notes by Denny's Corporation for consideration
     in an aggregate amount not to exceed an amount, not less than $50 million,
     equal to the sum of $50 million plus 50% of the difference between $160
     million and the amount of Old Notes tendered and accepted in exchange for
     the original notes on April 15, 2002; provided, however, that no Default or
     Event of Default shall have occurred and be continuing at the time of any
     such repurchase, redemption or other acquisition or retirement;

provided, that in determining the aggregate amount expended for Restricted
Payments in accordance with clause (c) of the first paragraph of this covenant,
(x) no amounts expended under clauses (2), (4), or (5) of this paragraph shall
be included, (y) 100% of the amounts expended under clauses (3), (6), (7) and
(8) of this paragraph shall be included, and (z) 100% of the amounts expended
under clause (1), to the extent not included under subclauses (x) or (y) of this
proviso, shall be included.


                                       36

<PAGE>

     Limitation on Additional Indebtedness and Issuance of Disqualified Stock.
The indenture provides that (1) each issuer will not, and will not permit any of
its Subsidiaries to, directly or indirectly, create, incur, issue, assume or
guarantee any Indebtedness (other than (A) Indebtedness (a) owing from any of
the Denny's Holdings Group payable to any of the Denny's Corporation Group; (b)
between Denny's Holdings and a Subsidiary of Denny's Holdings; (c) between
Subsidiaries of Denny's Holdings; (d) between Denny's Corporation and a
Subsidiary of Denny's Corporation in the Denny's Corporation Group; or (e)
between Subsidiaries of the Denny's Corporation Group; and (B) guarantees by
Denny's Corporation or any Subsidiary of Denny's Corporation of Indebtedness of
any of the Denny's Holdings Group or guarantees by any Subsidiary in the Denny's
Corporation Group of Indebtedness of any of the Denny's Corporation Group) and
(2) neither issuer will issue any Disqualified Stock, unless (a) such
Indebtedness or Disqualified Stock is either Acquisition Indebtedness or is
created, incurred, issued, assumed or guaranteed by such issuer and not a
Subsidiary of such issuer and (b) Denny's Corporation's Fixed Charge Coverage
Ratio for the four full fiscal quarters last preceding the date such additional
Indebtedness is created, incurred, assumed or guaranteed, or such additional
stock is issued, would have been at least 2.25:1, determined on a pro forma
basis (including a pro forma application of the net proceeds of such
Indebtedness or such issuance of stock) as if the additional Indebtedness had
been created, incurred, assumed or guaranteed, or such additional stock had been
issued, at the beginning of such four-quarter period.

     The foregoing limitations will not apply to the incurrence by an issuer or
any of its Subsidiaries of any Indebtedness pursuant to the Credit Agreement;
provided, however, that the principal amount of such Indebtedness incurred and
outstanding at any time pursuant to the Credit Agreement (including any
Indebtedness incurred to refund or refinance such Indebtedness) for this purpose
will not exceed the greater of $250 million and the aggregate amount of the
commitments under the Credit Agreement on the date of the indenture.

     In addition, the foregoing limitations notwithstanding,

         (1) Denny's Corporation or any of its Subsidiaries may create, incur,
     issue, assume or guarantee Indebtedness pursuant to the Credit Agreement or
     otherwise, (a) in connection with or arising out of Mortgage Financings,
     Mortgage Refinancings and sale and lease-back transactions; provided that
     the Mortgage Financing Proceeds, Mortgage Refinancing Proceeds (excluding
     any Mortgage Refinancing Proceeds received in connection with any
     refinancing of any Indebtedness secured by a mortgage or Lien on the
     Excluded Property) or Net Proceeds, as the case may be, incurred, assumed
     or created in connection therewith are used to pay any outstanding Senior
     Indebtedness, and provided further that any amounts used to repay
     Indebtedness outstanding under the Old Notes shall be applied only as and
     when permitted under the covenant "Limitation on Restricted Payments", (b)
     constituting purchase money obligations for property acquired in the
     ordinary course of business or other similar financing transactions
     (including, without limitation, in connection with Mortgage Financings and
     Mortgage Refinancings as and to the extent permitted in clause (a) above);
     provided that, in the case of Indebtedness exceeding $2 million for any
     such obligation or transaction, such Indebtedness exists at the date of the
     purchase or transaction or is created within 180 days thereafter, (c)
     constituting capital lease obligations, (d) constituting reimbursement
     obligations with respect to letters of credit, including, without
     limitation, letters of credit in respect of workers' compensation claims
     issued for the account of an issuer or a Subsidiary of an issuer in the
     ordinary course of its business, or other Indebtedness with respect to
     reimbursement type obligations regarding workers' compensation claims, (e)
     constituting additional Indebtedness in an aggregate principal amount
     (including any Indebtedness incurred to refund or refinance such
     Indebtedness) at any one time outstanding of up to $179,611,000 (which is
     equal to the difference between $250 million and the aggregate principal
     amount of original notes issued on April 15, 2002), whether incurred under
     the Credit Agreement or otherwise, provided, however that no more than $50
     million of such additional Indebtedness incurred pursuant to this subclause
     (e) shall be secured by a consensual Lien or be secured by Denny's
     Corporation or any Subsidiary of Denny's Corporation other than Denny's
     Holdings, (f) constituting Indebtedness secured by the Excluded Property,
     and (g) constituting Existing Indebtedness and permitted refinancings
     thereof in accordance with clause (2) of this paragraph;

         (2) an issuer or any Subsidiary of an issuer may create, incur, issue,
     assume or guarantee any Indebtedness that serves to refund, refinance or
     restructure the new notes, Existing Indebtedness or any other Indebtedness
     incurred as permitted under the indenture, or any Indebtedness issued to so
     refund, refinance or restructure such Indebtedness, in an amount equal to
     or less than the Indebtedness being so refunded, refinanced or
     restructured, including additional Indebtedness incurred to pay premiums
     and fees in connection therewith ("Refinancing Indebtedness"), prior to its
     respective maturity; provided, however, that such Refinancing Indebtedness
     is incurred by the obligor on the Indebtedness being refinanced and (a)
     bears an interest rate per annum that is equal to or less than the interest
     rate per annum then payable under such Indebtedness being refunded or
     refinanced (calculated in accordance with any formula

                                       37

<PAGE>

     set forth in the documents evidencing any such Indebtedness) unless such
     Refinancing Indebtedness is incurred, created or assumed within twelve
     months of the scheduled maturity of the Indebtedness being refinanced,
     (b) has a Weighted Average Life to Maturity at the time such Refinancing
     Indebtedness is incurred which is not less than the remaining Weighted
     Average Life to Maturity of such Indebtedness being refunded or
     refinanced, and (c) to the extent such Refinancing Indebtedness refinances
     Indebtedness subordinated to the new notes, such refinancing indebtedness
     is subordinated to the new notes at least to the same extent as the
     Indebtedness being refinanced or refunded, and provided further that
     subclauses (a), (b) and (c) of this clause (2) will not apply to any
     refunding or refinancing of any Senior Indebtedness; and

         (3) any nonconsolidated subsidiary of an issuer created after the date
     of the indenture may create, incur, issue, assume, guarantee or otherwise
     become liable with respect to any additional Indebtedness; provided that
     such Indebtedness is nonrecourse to any issuer and its consolidated
     subsidiaries, and the issuers and their consolidated Subsidiaries have no
     liability with respect to such additional Indebtedness.

     Limitation on Liens. The indenture provides that, subject to certain
exceptions, each issuer shall not, and shall not permit any of its Subsidiaries
to, directly or indirectly, create, incur, assume or suffer to exist any Lien
upon any asset now owned or hereafter acquired, except with respect to (a) Liens
securing or arising under or in connection with any Indebtedness of an issuer
not expressly by its terms subordinate or junior in right of payment to any
other Indebtedness of such issuer; (b) Liens existing on the date of the
indenture; (c) Liens permitted by or required pursuant to the Credit Agreement;
(d) Liens relating to judgments to the extent such judgments do not give rise to
specified Events of Default; (e) Liens arising under or in connection with the
satisfaction and discharge of the indenture; (f) Liens incurred in the ordinary
course of business so long as the Indebtedness secured by such Lien does not
exceed $5 million at any one time outstanding; (g) Liens for taxes or
assessments and similar charges either (x) not delinquent or (y) contested in
good faith by appropriate proceedings and as to which either issuer or a
Subsidiary of either issuer shall have set aside on its books such reserves as
may be required pursuant to generally accepted accounting principles; (h) Liens
incurred or pledges and deposits in connection with workers' compensation,
unemployment insurance and other social security benefits, or securing
performance bids, tenders, leases, contracts (other than for the repayment of
borrowed money), statutory obligations, progress payments, surety and appeal
bonds and other obligations of like nature, incurred in the ordinary course of
business; (i) Liens imposed by law, such as mechanics', carriers',
warehousemen's, materialmen's and vendors' Liens, incurred in good faith in the
ordinary course of business; (j) zoning restrictions, easements of licenses,
covenants, reservations, restrictions on the use of real property or minor
irregularities of title incident thereto of any of the Denny's Holdings Group
which do not in the aggregate materially detract from the value of the property
or assets of the Denny's Holdings Group, taken as a whole, or of any of the
Denny's Corporation Group which do not in the aggregate materially detract from
the value of the property or assets the Denny's Corporation Group, taken as a
whole, or materially impair the operation of the business of, as applicable,
either the Denny's Holdings Group, taken as a whole, or the Denny's Corporation
Group, taken as a whole; (k) Liens created by Subsidiaries in the Denny's
Holdings Group to secure Indebtedness of such Subsidiaries to any of Denny's
Holdings Group or Liens created by Subsidiaries in the Denny's Corporation Group
to secure Indebtedness of such Subsidiaries to any of the Denny's Corporation
Group or the Denny's Holdings Group; (l) pledges of or Liens on raw materials or
on manufactured products as security for any drafts or bills of exchange in
connection with the importation of such raw materials or manufactured products
in the ordinary course of business; (m) a Lien on any assets (x) securing
Indebtedness incurred or assumed pursuant to clause (b) or (c) or paragraph (1)
of the covenant "Limitation on Additional Indebtedness and Issuance of
Disqualified Stock" for the purpose of financing all or any part of the cost of
acquiring such asset or construction thereof or thereon or (y) existing on
assets or businesses at the time of the acquisition thereof; (n) the Lien
granted to the Trustee pursuant to the indenture and any substantially
equivalent Lien granted to the respective trustees under the indentures for
other debt securities of either issuer; (o) Liens arising in connection with any
Mortgage Financing or Mortgage Refinancing by either issuer or any of its
Subsidiaries; (p) Liens securing reimbursement obligations with respect to
letters of credit issued for the account of either issuer or any of its
Subsidiaries in the ordinary course of business; (q) any Lien on the Excluded
Property; (r) Liens securing an interest of a landlord in real property leases;
and (s) Liens created in connection with the refinancing of any Indebtedness
secured by Liens permitted to be incurred or to exist pursuant to the foregoing
clauses; provided, however, that no additional assets are encumbered by such
Liens in connection with such refinancing, unless permitted by clause (c) above
or the immediately succeeding sentence. The indenture provides that,
notwithstanding the foregoing, an issuer may create or assume any Lien upon its
properties or assets if such issuer shall cause the new notes to be equally and
ratably secured with all other Indebtedness secured by such Lien as long as such
other Indebtedness shall be so secured. Notwithstanding anything in the
indenture to the contrary, in no event shall any Lien be incurred (i) securing
Indebtedness outstanding pursuant to the Old Notes or (ii) on any assets of the
Denny's Holdings Group securing Indebtedness of any of

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<PAGE>

the Denny's Corporation Group (other than such Indebtedness of any of the
Denny's Corporation Group which is also Indebtedness of any of the Denny's
Holdings Group).

     Limitation on Dividends and Other Payment Restrictions Affecting
Subsidiaries. The indenture provides that each issuer will not, and will not
permit any of its Subsidiaries (other than nonconsolidated subsidiaries) to,
directly or indirectly, create or otherwise cause or suffer to exist or become
effective any consensual encumbrance or restriction on the ability of any such
Subsidiary to (1) pay dividends or make any other distributions on its Capital
Stock or any other interest or participation in, or measured by, its profits,
owned by an issuer or any of its Subsidiaries or pay any Indebtedness owed to an
issuer or any of its Subsidiaries, (2) make loans or advances to an issuer or
any of its Subsidiaries or (3) transfer any of its properties or assets to an
issuer or any of its Subsidiaries, except in each case for such encumbrances or
restrictions existing under or by reason of (a) applicable law, (b) the
indenture, (c) the Credit Agreement or any other agreement entered into in
connection therewith or as contemplated thereby, (d) customary provisions
restricting subletting or assignment of any lease governing a leasehold interest
of an issuer or any of its Subsidiaries, (e) any instrument governing
Indebtedness of a person acquired by an issuer or any of its Subsidiaries at the
time of such acquisition; provided that such Indebtedness is not incurred in
connection with or in contemplation of such acquisition, (f) the Old Notes,
Existing Indebtedness or other contractual obligation of an issuer or any of its
Subsidiaries existing on the date of the indenture, (g) additional Indebtedness
in an aggregate principal amount at any one time outstanding of up to
$179,611,000 (which is equal to the difference between $250 million and the
amount of original notes issued on April 15, 2002), (h) any amendment,
modification, renewal, extension, replacement, refinancing or refunding of
encumbrances or restrictions imposed pursuant to clauses (b), (c), (f) or (g)
above; provided that the restrictions contained in any such amendment,
modification, renewal, extension, replacement, refinancing or refunding are no
less favorable in all material respects to the holders of the new notes, (i) any
Mortgage Financing or Mortgage Refinancing, (j) any Permitted Investment or (k)
contracts for the sale of assets so long as such encumbrances or restrictions
apply only to the assets to be sold pursuant thereto.

     Limitation on Sale of Assets. The indenture provides that neither issuer
nor any of their respective Subsidiaries (other than nonconsolidated
subsidiaries) will (A) (x) sell, lease, convey or otherwise dispose of, in any
transaction or group of transactions that are a part of a common plan, all or
substantially all of the assets or Capital Stock of any Asset Segment (provided
that the sale, lease, conveyance or other disposition of all or substantially
all of an issuer's assets will not be governed by this provision but rather by
the provisions described under "--Merger, Consolidation or Sale of All or
Substantially All Assets") or (y) issue or sell Equity Interests of any Asset
Segment (each of the foregoing, an "Asset Sale") or (B) sell, lease, convey or
otherwise dispose of any Business Segment, unless in each case, such issuer
shall apply the Net Proceeds from such Asset Sale or such sale, lease,
conveyance or other disposition of a Business Segment to one or more of the
following in such combination as such issuer may choose: (1) an Investment in
another asset or business in the same line of business as, or a line of business
similar to that of, the line of business of Denny's Corporation and its
Subsidiaries (other than in the case of any Asset Sale of an Asset Segment in
any of the Denny's Holdings Group or any sale, lease, conveyance or other
disposition of any Business Segment in any of the Denny's Holdings Group, any
Investment by any of the Denny's Holdings Group in any of the Denny's
Corporation Group) and such Investment occurs within 366 days of such Asset Sale
or such sale, lease, conveyance or other disposition of a Business Segment, (2)
a Net Proceeds Offer (defined below) expiring within 366 days of such Asset Sale
or such sale, lease, conveyance or other disposition of a Business Segment or
(3) the purchase, redemption or other prepayment or repayment of outstanding
Senior Indebtedness within 366 days of such Asset Sale or such sale, lease,
conveyance or other disposition of a Business Segment, provided that any amounts
used to repay Indebtedness outstanding under the Old Notes shall be applied only
as and when permitted under the covenant "Limitation on Restricted Payments";
provided, however, that if the net amount not invested pursuant to clause (1)
above or applied pursuant to clause (3) above is less than $15 million, such
issuer shall not be further obligated to offer to repurchase new notes pursuant
to clause (2) above. Notwithstanding the foregoing, the receipt of all proceeds
of insurance paid on account of the loss of or damage to any Business Segment
and awards of compensation for any such Business Segment taken by condemnation
or eminent domain which result in net proceeds to such issuer of $50 million or
more (excluding proceeds to be used for replacement of such Business Segment,
provided that the trustee has received notice from such issuer within 90 days of
such receipt of its intention to use such proceeds for such purpose) will be
deemed an "Asset Sale." Notwithstanding anything herein to the contrary, the
following will not be deemed an "Asset Sale" or a sale or other disposition of a
Business Segment: (a) Permitted Investments, (b) sales, leases, conveyances or
other dispositions of assets by (i) any of the Denny's Corporation Group to
Denny's Corporation or any of its wholly owned Subsidiaries or (ii) any of the
Denny's Holdings Group to Denny's Holdings, or (c) a Public Offering of any
Subsidiary of Denny's Corporation, but only to the extent that the proceeds of
which are used to redeem up to 35% of the aggregate principal amount of new
notes as provided above under "Optional Redemption."


                                       39

<PAGE>

     For purposes of clause (2) of the preceding paragraph, the issuers shall
apply the Net Proceeds of the Asset Sale or the sale, lease, conveyance or other
disposition of a Business Segment to make a tender offer in accordance with
applicable law (a "Net Proceeds Offer") to repurchase new notes at a price not
less than 100% of the principal amount thereof, plus accrued and unpaid
interest. Any Net Proceeds Offer shall be made by the issuers only if and to the
extent permitted under, and subject to prior compliance with, the terms of any
agreement governing Senior Indebtedness. If on the date any Net Proceeds Offer
is commenced, securities of an issuer ranking pari passu in right of payment
with the new notes are at the time outstanding, and the terms of such securities
provide that a similar offer is to be made with respect thereto, then the Net
Proceeds Offer for the new notes shall be made concurrently with such other
offer, and securities of each issue shall be accepted pro rata in proportion to
the aggregate principal amount of securities of each issue which the holders of
securities of such issue elect to have repurchased. After the last date on which
holders of the new notes are permitted to tender their new notes in a Net
Proceeds Offer, the issuer that originally received the Net Proceeds shall not
be restricted under this "Restrictions on Sale of Assets" covenant as to its use
of any Net Proceeds available to make such Net Proceeds Offer (up to the amount
of Net Proceeds that would have been used to repurchase new notes assuming 100%
acceptance of the Net Proceeds Offer) but not used to repurchase new notes
pursuant thereto.

     Notwithstanding any provision of the indenture to the contrary, for a
period of 120 days after the last date on which holders of the new notes are
permitted to tender their new notes in the Net Proceeds Offer, the issuer that
originally received the Net Proceeds may use any Net Proceeds available to make
such Net Proceeds Offer but not used to repurchase new notes pursuant thereto to
purchase, redeem or otherwise acquire or retire for value any securities of such
issuer ranking junior in right of payment to the new notes at a price, stated as
a percentage of the principal or face amount of such junior securities, not
greater than the price, stated as a percentage of the principal amount of the
new notes, offered in the Net Proceeds Offer; provided that, if the Net Proceeds
Offer is for a principal amount (the "Net Proceeds Offer Amount") of the new
notes less than the aggregate principal amount of the new notes then
outstanding, then the Net Proceeds available for use by such issuer for such a
purchase, redemption or other acquisition or retirement for value of junior
securities shall not exceed the Net Proceeds Offer Amount.

     Limitation on Transactions with Affiliates. The indenture provides that
each issuer will not, and will not permit any of its Subsidiaries to, directly
or indirectly, enter into any transaction with any Affiliate (including, without
limitation, the purchase, sale, lease or exchange of any property or the
rendering of any service) involving aggregate consideration in excess of
$5,000,000 for any one transaction, except for (1) transactions (including any
investments, loans or advances by or to any Affiliate) in good faith the terms
of which are fair and reasonable to such issuer or Subsidiary, as the case may
be, and are at least as favorable as the terms that could be obtained by such
issuer or Subsidiary, as the case may be, in a comparable transaction made on an
arm's length basis between unaffiliated parties (in each case as conclusively
determined by a majority of the board of directors of Denny's Corporation or
Denny's Holdings, as applicable, unaffiliated with such Affiliate or, if there
are no such directors, as conclusively determined by a majority of the board of
directors of Denny's Corporation or Denny's Holdings, as applicable), (2)
transactions in which such issuer or any of its Subsidiaries, as the case may
be, delivers to the holders of the new notes a written opinion of a nationally
recognized investment banking firm stating that such transaction is fair to such
issuer or Subsidiary, as the case may be, from a financial point of view, (3)
transactions between such issuer and its Subsidiaries or between Subsidiaries of
such issuer that are not otherwise prohibited by the covenant described under
"Limitation on Restricted Payments," and (4) payments or loans to employees or
consultants pursuant to employment or consultancy contracts which are approved
by the board of directors of Denny's Corporation or Denny's Holdings, as
applicable, in good faith.

     Investments in Unrestricted Subsidiaries. The indenture provides that each
issuer will not, and will not permit any of its Subsidiaries to, directly or
indirectly, make any Investment in any Unrestricted Subsidiary unless (1) the
amount of such Investment does not exceed the amount then permitted to be used
to make a Restricted Payment pursuant to clause (c) of the first paragraph under
"Limitation on Restricted Payments" above and (2) immediately after such
Investment, and after giving effect thereto on a pro forma basis deducting from
Net Income the amount of any Investment the issuers and Subsidiaries of the
issuers have made in Unrestricted Subsidiaries during the four full fiscal
quarters last preceding the date of such Investment, Denny's Corporation would
be able to incur $1 of additional Indebtedness pursuant to the Fixed Charge
Coverage Ratio test described under "Limitation on Additional Indebtedness and
Issuance of Disqualified Stock" above.

     Notwithstanding clauses (1) and (2) of the immediately preceding paragraph
or any provision contained in the indenture to the contrary, the issuers and
their Subsidiaries shall be permitted to make investments in Unrestricted
Subsidiaries in an aggregate amount not to exceed $25 million (without regard to
the FRD Investment) at any one time outstanding. The amount by which the
aggregate of all Investments in Unrestricted Subsidiaries exceeds $25 million
(without regard to the FRD

                                       40

<PAGE>

Investment) shall be counted in determining the aggregate permissible amount of
Restricted Payments pursuant to clause (c) of the first paragraph under
"Limitation on Restricted Payments" above. Neither issuer will permit any
Unrestricted Subsidiary to become a Subsidiary, except pursuant to the last
sentence of the definition of "Unrestricted Subsidiary."

     Merger, Consolidation or Sale of All or Substantially All Assets. The
indenture provides that neither issuer will consolidate or merge with or into,
or sell, transfer, lease or convey all or substantially all of its assets to,
any person unless:

         (1) the person formed by or surviving any such consolidation or merger
     (if other than such issuer), or to which such sale, transfer, lease or
     conveyance shall have been made, is a corporation organized and existing
     under the laws of the United States, any state thereof or the District of
     Columbia;

         (2) the corporation formed by or surviving any such consolidation or
     merger (if other than such issuer), or to which such sale, transfer, lease
     or conveyance shall have been made, assumes all the obligations of such
     issuer pursuant to a supplemental indenture in a form reasonably
     satisfactory to the trustee under the new notes and the indenture;

         (3) immediately after such transaction no Default or Event of Default
     exists;

         (4) such issuer or any corporation formed by or surviving any such
     consolidation or merger, or to which such sale, transfer, lease or
     conveyance shall have been made, shall have an Adjusted Consolidated Net
     Worth (immediately after the transaction but prior to any purchase
     accounting adjustments resulting from the transaction) equal to or greater
     than the Adjusted Consolidated Net Worth of such issuer immediately
     preceding the transaction; provided, however, that clause (4) will not
     apply to any transaction where the consideration consists solely of common
     stock or other Equity Interests of such issuer or any surviving corporation
     and any liabilities of such person are not assumed by and are specifically
     non-recourse to such issuer or such surviving corporation; and

         (5) after giving effect to such transaction and immediately thereafter,
     such issuer or any corporation formed by or surviving any such
     consolidation or merger, or to which such sale, transfer, lease or
     conveyance shall have been made, shall be permitted to incur at least $1 of
     additional indebtedness as provided under clause (b) of the first paragraph
     under "Limitation on Additional Indebtedness and Issuance of Disqualified
     Stock" above if such provision were applicable to such entity.

     Future Subsidiary Guarantors. The indenture provides that each issuer will
not permit any of its Subsidiaries to guarantee the payment of any Indebtedness
of an issuer that is expressly by its terms subordinate or junior in right of
payment to any other Indebtedness of such issuer (a "Subordinated Indebtedness
Guarantee"), unless (i) such Subsidiary executes and delivers a supplemental
indenture evidencing its guarantee of such issuer's Obligations under the
indenture and under the new notes on a substantially similar basis (the
"Securities Guarantee") and (ii) the Securities Guarantee is senior in right of
payment to such Subordinated Indebtedness Guarantee to the same extent as the
new notes are senior in right of payment to such junior Indebtedness of such
issuer; provided that if such Subordinated Indebtedness Guarantee ceases to
exist for any reason, the Securities Guarantee shall thereupon automatically
cease to exist. Notwithstanding anything herein to the contrary, in no event
shall any Subsidiary of Denny's Corporation guarantee Indebtedness outstanding
pursuant to the Old Notes.

Change Of Control

     The indenture provides that, if at any time

         (1) all or substantially all of an issuer's assets are sold as an e
     ntirety to any person or related group of persons,

         (2) an issuer is merged with or into another corporation or another
     corporation is merged with or into an issuer with the effect that
     immediately after such transaction the stockholders of such issuer
     immediately prior to such transaction hold less than a majority in interest
     of the total voting power entitled to vote in the election of directors,
     managers or trustees of the person surviving such transaction,

         (3) any person or related group of persons acquires a majority in
     interest of the total voting power or voting stock of an issuer,

                                       41

<PAGE>


         (4) the persons constituting the board of directors of Denny's
     Corporation on the date of the indenture or persons nominated or elected to
     the board of directors of Denny's Corporation by a majority vote of such
     directors (the "Continuing Directors") or by a majority vote of the
     Continuing Directors do not constitute a majority of the members of the
     board of directors of Denny's Corporation, or

         (5) Denny's Corporation shall cease to own, directly or indirectly,
     100% of the Equity Interests of Denny's Holdings having ordinary voting
     power for the election of directors or other governing body,

then, in any such case, the issuers will notify the holders of the new notes in
writing of such occurrence and will make an offer to purchase in accordance with
the terms of the indenture (the "Change of Control Offer") all new notes then
outstanding at a purchase price equal to 101% of the principal amount thereof,
plus accrued and unpaid interest, if any, to the repurchase date; provided,
however, that such repurchase will only occur if there has been no acceleration
which has not been withdrawn or paid pursuant to the Credit Agreement prior to
the time of notice of a Change of Control Offer.

     Prior to the mailing of the notice to holders provided for above, the
issuers will (x) to the extent then repayable or prepayable, repay in full all
Indebtedness under the Credit Agreement and, to the extent not then repayable or
prepayable, offer to repay in full all such Indebtedness and to repay the
Indebtedness of each lender under the Credit Agreement who has accepted such
offer or (y) obtain the requisite consent under the Credit Agreement to permit
the repurchase of the new notes. The issuers shall first comply with the proviso
in the preceding sentence before they shall be required to repurchase the new
notes pursuant to this covenant. The issuers will comply with all applicable
tender offer rules (including without limitation Rule 14e-1 under the Exchange
Act, if applicable) in the event that the repurchase option is triggered under
the circumstances described herein. Not less than 30 or more than 60 days
following any change of control, the issuers will mail a notice to each holder
of any new notes stating, among other things, (a) that a change of control has
occurred and that a change of control offer is being made as described in this
provision, (b) the purchase price and the change of control payment date and (c)
the instructions determined by the issuers, consistent with this provision, that
a holder of the new notes must follow in order to have such holder's new notes
repurchased.

Events Of Default And Remedies

     "Events of Default" under the indenture include:

         (1) default for 30 days in payment of interest on any of the new notes;

         (2) default in payment when due of principal, whether at maturity,
     upon redemption or otherwise;

         (3) failure by the issuers for 30 days after notice to comply with any
     other agreements or covenants in the indenture or the new notes;

         (4) default under any instrument governing any Indebtedness of an
     issuer or its Subsidiaries (other than (A) Indebtedness of any of the
     Denny's Corporation Group to any of the Denny's Corporation Group or
     Indebtedness of any of the Denny's Holdings Group to any of the Denny's
     Holdings Group or (B) Indebtedness of a nonconsolidated subsidiary of an
     issuer that is nonrecourse to such issuer or its consolidated
     Subsidiaries), if (a) either (x) such default results from the failure to
     pay principal upon the final maturity of such Indebtedness (after the
     expiration of any applicable grace period) or (y) as a result of such
     default the maturity of such Indebtedness has been accelerated prior to its
     final maturity, (b) the principal amount of such Indebtedness, together
     with the principal amount of any other such Indebtedness with respect to
     which the principal amount remains unpaid upon its final maturity (after
     the expiration of any applicable grace period), or the maturity of which
     has been so accelerated, aggregates $30 million or more and (c) such
     default does not result from compliance with any applicable law or any
     court order or governmental decree to which such issuer or any of its
     Subsidiaries is subject;

         (5) failure by an issuer or any of its Subsidiaries to pay certain
     final judgments aggregating in excess of $10 million (net of amounts
     covered by insurance, treating any deductibles, self-insurance or retention
     as not so covered) which judgments remain undischarged for a period of 60
     days after their entry by a competent tribunal; and

         (6) certain events of bankruptcy or insolvency.


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<PAGE>

     An Event of Default shall not be deemed to have occurred under clause (4)
or (5) until the issuers shall have received written notice thereof from the
trustee or the holders of at least 30% in principal amount of the new notes then
outstanding.

     If an Event of Default, other than in respect of any events of bankruptcy
or insolvency, occurs and is continuing with respect to the new notes, the
trustee or the holders of at least 30% (or 25% in the case of an Event of
Default with respect to payment of principal of or interest on the new notes) in
principal amount of the new notes then outstanding may declare in writing 100%
of the principal amount of, and any accrued and unpaid interest on, the new
notes to be due and payable immediately; provided, however, that if any Senior
Indebtedness is outstanding pursuant to the Credit Agreement, then all the new
notes shall be due and payable upon the earlier of (x) the day that is five
business days after the provision to the issuers and the Credit Agent of such
written notice of acceleration unless such Event of Default is cured or waived
prior to such date and (y) the date of acceleration of any Senior Indebtedness
under the Credit Agreement. In the event of a declaration of acceleration
because an event of default described in clause (4) of the immediately preceding
paragraph has occurred and is continuing, such declaration of acceleration shall
be automatically annulled if such payment default is cured or waived or the
holders of the Indebtedness which is the subject of such Event of Default have
rescinded their declaration of acceleration in respect of such Indebtedness
within 60 days thereof and the trustee has received written notice of such cure,
waiver or rescission and no other Event of Default described in clause (4) of
the preceding paragraph has occurred and is continuing with respect to which 60
days have elapsed since the declaration of acceleration of the Indebtedness
which is the subject thereof (without rescission of the declaration of
acceleration of such indebtedness). Upon an Event of Default arising from
certain events of bankruptcy or insolvency, the unpaid principal of and any
accrued and unpaid interest on all the new notes will immediately become due and
payable without further action or notice.

     Holders of the new notes may not enforce the indenture or the new notes
except as provided in the indenture. Subject to certain limitations, holders of
a majority in principal amount of the new notes then outstanding may direct the
trustee in its exercise of any trust or power.

     The trustee may withhold from holders of the new notes notice of any
continuing Default or Event of Default (except a default or event of default in
payment of principal or interest) if it determines in good faith that
withholding notice is in the interests of such holders.

     The holders of a majority in aggregate principal amount of the new notes
then outstanding may on behalf of the holders of all of the new notes waive any
past Default or Event of Default under the indenture and its consequences,
except a continuing Default or Event of Default in the payment of the principal
of or interest on the new notes.

     The issuers are required to deliver to the trustee annually a statement
regarding compliance with the indenture, and, upon an officer of an issuer
becoming aware of any event of default or of certain defaults, a statement
specifying such event of default or default and what action the issuers are
taking or propose to take with respect thereto.

Recourse Against Incorporators, Officers, Directors And Stockholders

     No recourse shall be had against any incorporator, officer, director or
stockholder, as such, of Denny's Corporation or Denny's Holdings for any
obligation under the new notes or the indenture, and each holder of the new
notes by accepting a new note waives and releases all such liability. The waiver
and release are part of the consideration for issuance of the new notes. Nothing
in this provision limits the liability, if any, of any such incorporator,
officer, director or stockholder, as such, under the federal securities laws.

Transfer And Exchange

     The issuers may require payment of a sum sufficient to cover any tax or
other governmental charge that may be imposed in connection with any exchange or
registration of transfer of new notes. No service charge will be made for any
registration of transfer or exchange of the new notes.

     The trustee is not required to transfer or exchange any new notes selected
for redemption except, in the case of any new note where public notice has been
given that such new note is to be redeemed in part, the portion thereof not so
to be redeemed. Also, the trustee is not required to transfer or exchange any
new note for a period of 15 days before the mailing of a notice of redemption of
new notes to be redeemed.


                                       43

<PAGE>

     The registered holder of a new note will be treated as its owner for all
purposes.

Satisfaction And Discharge

     The indenture and the new notes provide that the indenture shall cease to
be of further effect (except for specified rights of registration of transfer
and exchange; the issuers' right of optional redemption; substitution of
mutilated, defaced, destroyed, lost or stolen new notes; rights of holders to
receive payments of principal and interest on the new notes; the rights,
obligations and immunities of the trustee under the indenture; rights of note
holders as beneficiaries of the indenture with respect to the property so
deposited with the trustee payable to all or any of them; and the obligation of
the issuers to maintain an office or agency for payment of the new notes), if at
any time:

         (a) the issuers shall have paid or caused to be paid the principal
     of and interest on all of the new notes outstanding, as and when the same
     shall have become due and payable, or

         (b) the issuers shall have delivered to the trustee for cancellation
     all new notes previously authenticated (subject to specified exceptions),
     or

         (c) all new notes not previously cancelled or delivered to the trustee
     for cancellation shall have become due and payable, or are by their terms
     to become due and payable within one year, or are to be called for
     redemption within one year under arrangements satisfactory to the trustee
     for the giving of notice of redemption, and the issuers shall deposit with
     the trustee, in trust, funds sufficient to pay at maturity or upon
     redemption of all of the new notes (other than any that have been
     destroyed, lost or stolen and have been replaced or paid as provided in the
     indenture) not previously cancelled or delivered to the trustee for
     cancellation, including principal and interest due or to become due to such
     date of maturity or redemption date, as the case be, (but excluding,
     however, the amount of any moneys for the payment of principal of or
     interest on the new notes previously repaid to the issuers pursuant to
     specified provisions of the indenture or unclaimed property or similar
     laws), or

         (d) the issuers shall also pay or cause to be paid all other sums
     payable under the indenture by the issuers.

     In addition, the issuers must deliver an Officers' Certificate and an
Opinion of Counsel to the trustee indicating that they have complied with all
conditions precedent to obtaining satisfaction and discharge under this
provision.

Defeasance

     The indenture and the new notes provide that the issuers will be deemed to
be discharged from any and all obligations in respect of the new notes (except
for certain obligations to register the transfer, substitution or exchange of
new notes to replace stolen, lost or mutilated new notes and to maintain paying
agencies, and except for the right of the holders of the new notes to receive
payments of principal, premium, if any, and interest on the new notes from the
defeasance trust, and the rights, obligations and immunities of the trustee)
within 91 days after applicable conditions have been satisfied, or that the
issuers may terminate their obligations under certain covenants in the indenture
upon the satisfaction of applicable conditions, including, in either case, upon
the deposit with the trustee, in trust, of money and/or U.S. Government
obligations which through the payment of interest and principal in respect
thereof in accordance with their terms will provide money in an amount
sufficient to pay the principal of (and premium, if any) and each installment of
interest on the new notes on the stated maturity of such payments or on a
selected date of redemption in accordance with the terms of the indenture and
the new notes. Such a trust may only be established if, among other things, the
issuers have delivered to the trustee either (1) an opinion of counsel to the
effect that holders of the new notes will not recognize income, gain or loss for
U.S. federal income tax purposes as a result of such deposit, discharge or
covenant defeasance and will be subject to U.S. federal income tax on the same
amount and in the same manner and at the same times as would have been the case
if such deposit, discharge or covenant defeasance had not occurred or (2) a
private letter ruling to such effect directed to the trustee received from the
Internal Revenue Service.

Modification of Indenture

     With the consent of the holders of not less than a majority in aggregate
principal amount of the new notes at the time outstanding, the issuers, when
authorized by a resolution of their respective boards of directors, and the
trustee may, from

                                       44

<PAGE>

time to time and at any time, enter into an indenture or indentures
supplemental to the indenture for the purpose of adding any provisions to or
changing in any manner or eliminating any of the provisions of the indenture or
of any supplemental indenture or of modifying in any manner the rights of the
holders of the new notes; provided that no such supplemental indenture shall
(a) extend the final maturity of any new notes, reduce the principal amount
thereof, reduce the rate or extend the time of payment of interest thereon, or
reduce the premium, if any, payable thereon, or reduce any amount payable on
redemption thereof, or impair or affect the right of any holder to institute
suit for the payment thereof, or waive a default in the payment of principal
of, premium, if any, or interest on any new notes, change the currency of
payment of principal of, premium, if any, or interest on any new notes, or
modify any provision in the indenture with respect to the priority of the new
notes in right of payment without the consent of the holder of each new note so
affected, or (b) reduce the aforesaid percentage of new notes, the consent of
the holders of which is required for any such supplemental indenture, without
the consent of the holders of each new note then outstanding. The indenture
also contains provisions permitting the issuers and the trustee to enter into
supplemental indentures for certain limited purposes without the consent of any
holders of the new notes.

Concerning the Trustee

     U.S. Bank National Association is acting as the trustee under the
indenture and will be the paying and registrar for the new notes.


                                       45

<PAGE>


                 UNITED STATES FEDERAL INCOME TAX CONSIDERATIONS

United States Tax Consequences

     Alston & Bird LLP, counsel to the issuers, has advised us that the
following reflects its opinion as to the material United States federal income
tax consequences associated with the exchange of the old notes for the new notes
pursuant to the exchange offer and the ownership and disposition of the new
notes. Except where noted, this discussion deals only with those holders who
hold the old notes and new notes as capital assets and does not deal with
special situations, such as those of brokers, dealers in securities or
currencies, financial institutions, tax-exempt entities, insurance companies,
persons liable for alternative minimum tax, United States persons whose
functional currency is not the U.S. dollar, persons holding old notes or new
notes as part of a hedging, integrated, conversion or constructive sale
transaction or a straddle, and traders in securities that elect to use a
mark-to-market method of accounting for their securities holdings. The following
summary does not address any state, local or non-United States tax consequences
or United States federal tax consequences (such as estate or gift tax) other
than those pertaining to the income tax.

     Furthermore, this discussion is based on provisions of the Internal Revenue
Code of 1986, as amended, the treasury regulations promulgated thereunder, and
administrative and judicial interpretations of the foregoing, all as in effect
as of the date hereof and all of which are subject to change, possibly with
retroactive effect. Moreover, substantial uncertainty, resulting from a lack of
definitive judicial or administrative authority and interpretation, exists with
respect to various aspects of the exchange offer, as discussed below. This
discussion represents our counsel's legal judgment, which will not be binding in
any manner on the Internal Revenue Service or the courts. No ruling has been or
will be requested from the IRS on any tax matters relating to the tax
consequences of the exchange offer, and no assurance can be given that the IRS
will not successfully challenge certain of the conclusions set forth below. This
discussion does not address tax consequences of the purchase, ownership, or
disposition of the new notes to holders of new notes other than those holders
who acquired their new notes pursuant to the exchange offer. If a partnership
holds the old notes or new notes, the tax treatment of a partner will generally
depend upon the status of the partner and the activities of the partnership.
Partners of partnerships that hold old notes or will acquire new notes pursuant
to the exchange offer should consult their own tax advisors.

     As used herein, the term U.S. Holder means a holder of old notes or new
notes that is, for United States federal income tax purposes:

         (1) an individual who is a citizen or resident of the United States;

         (2) a corporation or partnership created or organized in or under the
     law of the United States or of any political subdivision thereof;

         (3) an estate, the income of which is includible in gross income for
     United States federal income tax purposes regardless of its source; or

         (4) a trust if (a) a United States court is able to exercise primary
     supervision over the administration of the trust and one or more United
     States persons have the authority to control all substantial decisions of
     the trust or (b) the trust was in existence on August 20, 1996, was treated
     as a United States person prior to that date, and elected to continue to be
     treated as a United States person.

     Each U.S. Holder and non-U.S. Holder should consult its tax advisor
regarding the particular tax consequences to such holder of the exchange of the
old notes for the new notes pursuant to the exchange offer, the ownership and
disposition of the old notes and/or the new notes, as well as any tax
consequences that may arise under the laws of any other relevant foreign, state,
local, or other taxing jurisdiction.

U.S. Holders

     Exchange Offer

     The exchange of old notes for new notes should not be considered a taxable
exchange for federal income tax purposes because the new notes should not
constitute a material modification of the terms of the old notes. Accordingly,
such

                                       46

<PAGE>

exchange should have no federal income tax consequences to a U.S. Holder,
and the basis of a U.S. Holder in a new note will be the same as the adjusted
tax basis in the old note exchanged therefor.

     Payment of Interest

     Stated interest payable on the new notes generally will be included in the
gross income of a U.S. Holder as ordinary interest income at the time accrued or
received, in accordance with such U.S. Holder's method of accounting for United
States federal income tax purposes.

     Amortizable Bond Premium

     Generally, if the tax basis of a debt obligation exceeds its stated
redemption price at maturity, the holder may elect to treat such excess as
amortizable bond premium, in which case the amount required to be included in
income each year with respect to interest on the obligation will be reduced by
the amount of amortizable bond premium allocable to such year, determined on the
basis of the obligation's yield to maturity. Any election to amortize bond
premium applies to all taxable debt obligations held at the beginning of the
first taxable year to which the election applies or acquired thereafter, and may
not be revoked without the consent of the Internal Revenue Service.

     Sale, Exchange and Retirement of Notes

     A U.S. Holder generally will recognize capital gain or loss upon the sale,
exchange, retirement at maturity, or other taxable disposition of the new notes
equal to the difference between the amount realized by such holder (less an
amount equal to any accrued and unpaid interest not previously included in
income, which will be treated as ordinary interest income) and such holder's
adjusted tax basis in the notes. The deductibility of capital losses may be
subject to limitations.

     A U.S. Holder, other than an initial purchaser of the old notes, should be
aware that a sale or other disposition of the new notes may be affected by the
market discount provisions of the code. These rules generally provide that if a
U.S. Holder of the old notes purchased such notes, subsequent to the original
offering, at a market discount in excess of a statutorily defined de minimis
amount, and thereafter recognizes gain upon a disposition (including a partial
redemption) of the new notes received in exchange for such old notes, the lesser
of such gain or the portion of the market discount that accrued while the old
notes and the new notes were held by such holder will be treated as ordinary
interest income at the time of disposition. The market discount rules also
provide that a U.S. Holder who acquires the new notes at a market discount may
be required to defer a portion of any interest expense that may otherwise be
deductible on any indebtedness incurred or maintained to purchase or carry the
new notes until the U.S. Holder disposes of such notes in a taxable transaction.
If a U.S. Holder of the new notes elects to include market discount in income
currently, neither of the foregoing rules would apply.

     Information Reporting and Backup Withholding

     In general, information reporting requirements will apply to payments of
principal and interest on the new notes and to the proceeds of the sale of new
notes made to U.S. Holders other than certain exempt recipients (such as
corporations). A backup withholding tax will apply to such payments if the U.S.
Holder fails to file a Form W-9, fails to provide a taxpayer identification
number, furnishes an incorrect taxpayer identification number, fails to certify
foreign or other exempt status from backup withholding, or fails to report in
full dividend and interest income. Backup withholding is not an additional tax.
Any amounts withheld from a payment to a U.S. Holder under the backup
withholding rules will be allowed as a credit against the holder's United States
federal income tax liability and may entitle the holder to a refund, provided
that the required information is furnished to the IRS.

Non-U.S. Holders

     Subject to the discussion of backup withholding below, the interest income
and gains that a non-U.S. Holder derives in respect of the old notes and the new
notes generally will be exempt from United States federal income taxes,
including withholding tax.

     Payments of interest or principal in respect of the new notes to a holder
that is a non-U.S. Holder will not be subject to withholding of United States
federal income tax, provided that, in the case of payments of interest:

                                       47

<PAGE>

     (1) the income is effectively connected with the conduct by such non-U.S.
Holder of a trade or business carried on in the United States and the non-U.S.
Holder complies with applicable identification requirements (described below
under "Backup Withholding and Information Reporting"); or

     (2) the non-U.S. Holder and/or each securities clearing organization, bank,
or other financial institution that holds the new notes on behalf of such
non-U.S. Holder in the ordinary course of its trade or business, in the chain
between the non-U.S. Holder and the paying agent, complies with applicable
identification requirements (described below under "Backup Withholding and
Information Reporting") to establish that the holder is a non-U.S. Holder and in
addition, that the following requirements of the portfolio interest exemption
under the code are satisfied:

           o   the non-U.S. Holder does not actually or constructively own 10%
               or more of the voting stock of Denny's Corporation or Denny's
               Holdings;

           o   the non-U.S. Holder is not a controlled foreign corporation with
               respect to Denny's Corporation and Denny's Holdings; and the
               non-U.S. Holder is not a bank whose receipt of interest on the
               new notes is described in Section 881(c)(3)(A) of the code.

Any gain realized by a non-U.S. Holder on the sale or exchange of the new notes
generally will be exempt from U.S. federal income tax, including withholding
tax, unless:

         (1) such gain is effectively connected with the conduct of a trade or
     business in the United States (or if a tax treaty applies, such gain is
     attributable to a permanent establishment of the non-U.S. Holder);

         (2) in the case of a non-U.S. Holder that is an individual, such
     non-U.S. Holder is present in the United States for 183 days or more
     during the taxable year in which such sale, exchange, or other
     disposition occurs; or

         (3) in the case of gain representing accrued interest, the
     requirements of the portfolio interest exemption are not satisfied.

     If the interest income paid on the new notes or gain recognized from a sale
or exchange of the new notes is effectively connected with the conduct of a
trade or business in the United States by a non-U.S. Holder, such non-U.S.
holder will generally be taxed under the same rules that govern the taxation of
a U.S. Holder. In addition, if such holder is a foreign corporation, it may be
subject to an additional branch profits tax.

     Backup Withholding and Information Reporting

     Payment of the proceeds of a sale of a note or payment of interest will be
subject to information reporting requirements and backup withholding tax unless
the beneficial owner certifies its non-United States status under penalties of
perjury or otherwise establishes an exemption provided that the paying agent
does not actually know, or has reason to know, that the holder is actually a
U.S. Holder). Recently promulgated treasury regulations provide certain
presumptions under which a non-U.S. Holder will be subject to backup withholding
and information reporting unless such holder certifies as to its non-U.S. status
or otherwise establishes an exemption. In addition, the recent treasury
regulations change certain procedural requirements related to establishing a
holder's non-United States status. Non-U.S. Holders should consult with their
tax advisors regarding the above issues.

     Any amounts withheld from a payment to a non-U.S. Holder under the backup
withholding rules will be allowed as a credit against the holder's United States
federal income tax liability and may entitle the holder to a refund, provided
that the required information is furnished to the IRS.

     Applicable identification requirements generally will be satisfied if there
is delivered to a securities clearing organization either directly, or
indirectly, by the appropriate filing of a Form W-8IMY:

         (1) IRS Form W-8BEN signed under penalties of perjury by the non-U.S.
     Holder, stating that such holder of the new notes is not a United
     States person and providing such non-U.S. Holder's name and
     address;

                                       48

<PAGE>

         (2) with respect to non-U.S. Holders of the new notes residing in a
     country that has a tax treaty with the United States who seek an exemption
     or reduced tax rate (depending on the treaty terms), Form W-8BEN. If the
     treaty provides only for a reduced rate, withholding tax will be imposed at
     that rate unless the non-U.S. Holder qualifies under the portfolio interest
     rules set forth in the code and files a W-8BEN; or

         (3) with respect to interest income "effectively connected" with the
     conduct by such non-U.S. Holder of a trade or business carried on in the
     United States, Form W-8ECI;

provided that in any such case:

           o   the applicable form is delivered pursuant to applicable
               procedures and is properly transmitted to the United States
               withholding agent, otherwise required to withhold tax; and

           o   none of the entities receiving the form has actual knowledge or
               reason to know that the holder is a U.S. Holder.

                                  LEGAL MATTERS

     Certain legal matters in connection with the exchange offer will be passed
upon for us by Alston & Bird LLP, Charlotte, North Carolina.

                                     EXPERTS

     The financial statements as of December 27, 2000 and December 26, 2001, and
for each of the three fiscal years in the period ended December 26, 2001
included and incorporated by reference in this prospectus have been audited by
Deloitte & Touche LLP, independent auditors, as stated in their report, which is
included and incorporated by reference herein, and has been so included and
incorporated in reliance upon the report of such firm given upon their authority
as experts in accounting and auditing.


                                       49

<PAGE>





                                     PART II

                     INFORMATION NOT REQUIRED IN PROSPECTUS

Item 20.  Indemnification of Directors and Officers

     Denny's Corporation

     Denny's Corporation is a Delaware corporation. Reference is made to Section
102(b)(7) of the Delaware General Corporation Law (the "DGCL"), which enables a
corporation in its original certificate of incorporation or an amendment thereto
to eliminate or limit the personal liability of a director to the corporation or
its stockholders for monetary damages for breach of fiduciary duty as a
director, except (i) for any breach of the director's duty of loyalty to the
corporation or its stockholders, (ii) for acts or omissions not in good faith or
which involve intentional misconduct or a knowing violation of law, (3) pursuant
to Section 174 of the DGCL (providing for liability of directors for unlawful
payment of dividends or unlawful stock purchases or redemptions) or (4) for any
transaction from which a director derived an improper personal benefit.

     Reference is also made to Section 145 of the DGCL, which provides that a
corporation may indemnify any persons, including officers and directors, who
are, or are threatened to be made, parties to any threatened, pending or
completed legal action, suit or proceeding, whether civil, criminal,
administrative or investigative (other than an action by or in the right of such
corporation), by reason of the fact that such person is or was an officer,
director, employee or agent of such corporation or is or was serving at the
request of such corporation as an officer, director, employee or agent of
another corporation or enterprise. The indemnity may include expenses (including
attorneys' fees), judgments, fines and amounts paid in settlement actually and
reasonably incurred by such person in connection with such action, suit or
proceeding, provided such officer, director, employee or agent acted in good
faith and in a manner he reasonably believed to be in or not opposed to the
corporation's best interests and, with respect to any criminal action or
proceeding, had no reasonable cause to believe that his conduct was unlawful. A
Delaware corporation may indemnify officers, directors, employees and agents in
an action by or in the right of the corporation under the same conditions,
except that no indemnification is permitted without judicial approval if the
officer, director, employee or agent is adjudged to be liable to the
corporation. Where an officer, director, employee or agent is successful on the
merits or otherwise in the defense of any action referred to above, the
corporation must indemnify him against the expenses that such officer, director,
employee or agent actually and reasonably incurs.

     Denny's Corporation's Restated Certificate of Incorporation and By-Laws
provide for indemnification of its officers and directors to the full extent
permitted under Delaware law. Specifically, Articles Sixth and Seventh of the
Restated Certificate of Incorporation provide for indemnification of officers
and directors to the extent permitted by Section 145 of the DGCL and the
elimination of liability of directors to the extent permitted by Section
102(b)(7) of the DGCL, and Article 5, Section 14 of the By-Laws provides for
indemnification of officers and directors to the extent permitted by Section 145
of the DGCL. Consequently, Denny's Corporation maintains officers' and
directors' liability insurance for the benefit of its officers and directors.
The Employment Agreement dated as of January 7, 1998 between Denny's Corporation
and James B. Adamson and the Employment Agreement dated January 2, 2001 between
Denny's Corporation and Nelson J. Marchioli also provide for the indemnification
of Messrs. Adamson and Marchioli by Denny's Corporation to the extent permitted
by Delaware law and, in connection therewith, calls for the advancement of
attorneys' fees and expenses (subject to repayment in certain circumstances).

     Denny's Holdings, Inc.

     Denny's Holdings, Inc. is a New York corporation. Article 7, Section 722 of
the New York Business Corporation Law (the "Business Corporation Law") states
that a corporation may indemnify any person made, or threatened to be made, a
party to an action or proceeding (other than one by or in the right of the
corporation to procure a judgment in its favor), whether civil or criminal,
including an action by or in the right of any other corporation of any type or
kind, domestic or foreign, or any partnership, joint venture, trust, employee
benefit plan or other enterprise, which any director or officer of the
corporation served in any capacity at the request of the corporation, by reason
of the fact that he, his testator or intestate, was a director or officer of the
corporation, or served such other corporation, partnership, joint venture,
trust, employee benefit plan or other enterprise in any capacity, against
judgments, fines, amounts paid in settlement and reasonable expenses, including
attorneys' fees actually and necessarily incurred as a result of such action or
proceeding, or any appeal therein, if such director or officer acted, in good
faith, for a purpose which he reasonably believed to be in, or, in the case of
service for

                                       II-1
<PAGE>

any other corporation or any partnership, joint venture, trust, employee
benefit plan or other enterprise, not opposed to, the best interests of the
corporation and, in criminal actions or proceedings, in addition, had no
reasonable cause to believe that his conduct was unlawful.

     Section 722 also states that a corporation may indemnify any person made,
or threatened to be made, a party to an action by or in the right of the
corporation to procure a judgment in its favor by reason of the fact that he,
his testator or intestate, is or was a director or officer of the corporation,
or is or was serving at the request of the corporation as a director or officer
of any other corporation of any type or kind, domestic or foreign, of any
partnership, joint venture, trust, employee benefit plan or other enterprise,
against amounts paid in settlement and reasonable expenses, including attorneys'
fees, actually and necessarily incurred by him in connection with an appeal
therein, if such director or officer acted, in good faith, for a purpose which
he reasonably believed to be in, or, in the case of service for any other
corporation or any partnership, joint venture, trust, employee benefit plan or
other enterprise, not opposed to, the best interests of the corporation, except
that no indemnification under this paragraph shall be made in respect of (1) a
threatened action, or a pending action which is settled or otherwise disposed
of, or (2) any claim, issue or matter as to which such person shall have been
adjudged to be liable to the corporation, unless and only to the extent that the
court in which the action was brought, or, if no action was brought, any court
of competent jurisdiction, determines upon application that, in view of all the
circumstances of the case, the person is fairly and reasonably entitled to
indemnity for such portion of the settlement amount and expenses as the court
deems proper.

     Officers and directors of Denny's Holdings, Inc. are covered by the
officers' and directors' liability insurance maintained by Denny's Corporation.
Officers and directors of Denny's Holdings, Inc. are also covered by the
indemnification provisions of Denny's Corporation's Restated Certificate of
Incorporation and By-Laws (as described above) by virtue of the fact that such
persons are serving in such capacities at the request of the Denny's
Corporation.

Item 21.  Exhibits and Financial Statement Schedules


     (a) Exhibits:

             Exhibit
             No.                              Description
             -------                          -----------

             2.1          -  Joint Plan of Reorganization of Flagstar Companies,
                             Inc. ("FCI"), and Flagstar Corporation
                             ("Flagstar"), as amended November 7, 1997 and as
                             confirmed by order of the United States Bankruptcy
                             Court for the District of South Carolina entered
                             November 12, 1997 (incorporated by reference to
                             Exhibit 2.1 to FCI's Form 8-K, dated November 12,
                             1997).

             4.1          -  Indenture relating to the 111/4% Senior Notes
                             (including the form of security) dated as of
                             January 7, 1998, between Denny's Corporation and
                             First Trust National Association, as Trustee
                             (incorporated by reference to Exhibit 4.1 to
                             Denny's Corporation's Form 8-K filed January 15,
                             1998 (the "1998 Form 8-K")).

             4.2          -  Warrant Agreement (including the form of warrant)
                             (incorporated by reference to Exhibit 10.1 to
                             the Form 8-A of Denny's Corporation filed January
                             7, 1998 relating to Denny's Corporation's
                             common stock warrants).

             4.3          -  Rights Agreement, dated as of December 15, 1998,
                             between Denny's Corporation and Continental
                             Stock Transfer and Trust Company, as Rights Agent
                             (including Form of Right Certificate)
                             (incorporated by reference to Exhibit 1 to the
                             Form 8-A of Denny's Corporation filed December
                             15, 1998 relating to preferred stock purchase
                             rights).

             4.4          -  Indenture dated April 15, 2002, relating to the
                             123/4% Senior Notes (including the form of
                             security) among Denny's Corporation and Denny's
                             Holdings, Inc. and U.S. Bank National
                             Association, as Trustee (incorporated by reference
                             to Exhibit 4.6 of Denny's Corporation's Form
                             S-4/A filed December 28, 2001).

             5.1          -  Form of Opinion of Alston & Bird LLP regarding
                             legality of the New Notes.

             8.1          -  Form of Opinion of Alston & Bird LLP regarding tax
                             matters.

             10.1         -  Consent Order dated March 26, 1993 between the U.S.
                             Department of Justice, Flagstar

                                       II-2

<PAGE>

                             and Denny's, Inc.(incorporated by reference to
                             Exhibit 10.42 to the Registration Statement on
                             Form S-2 (No.33-49843) of Flagstar (the "Form
                             S-2")).

             10.2         -  Fair Share Agreement dated July 1, 1993 between
                             Flagstar and the NAACP (incorporated by reference
                             to Exhibit 10.43 to the Form S-2).

             10.3         -  Amended Consent Decree dated May 24, 1994
                             (incorporated by reference to Exhibit 10.50 to
                             FCI's Annual Report on Form 10-K for the year ended
                             December 31, 1994 (the "1994 Form 10-K")).

             10.4         -  Consent Decree dated May 24, 1994 among certain
                             named claimants, individually and on behalf of all
                             others similarly situated, Flagstar and Denny's,
                             Inc. (incorporated by reference to Exhibit 10.51 to
                             the 1994 Form 10-K).

             10.5         -  Employment Agreement, dated as of January 10,
                             1995, between FCI and James B. Adamson
                             (incorporated by reference to Exhibit 10.42 to the
                             1994 Form 10-K).

             10.6         -  Amendment to Employment Agreement, dated as of
                             February 27, 1995, between FCI and James B. Adamson
                             (incorporated by reference to Exhibit 10.44 to the
                             1994 Form 10-K).

             10.7         -  Second Amendment to Employment Agreement, dated
                             December 31, 1996, between FCI and James B. Adamson
                             (incorporated by reference to Exhibit 10.47 to
                             FCI's Annual Report on Form 10-K for the year ended
                             December 31, 1996 (the "1996 Form 10-K")).

             10.8         -  Employment Agreement between Denny's Corporation
                             and James B. Adamson, amended and restated as of
                             January 7, 1998 (incorporated by reference to
                             Exhibit 10.1 to Denny's Corporation's Quarterly
                             Report on Form 10-Q for the quarter ended March 31,
                             2002 (the "1999 First Quarter Form 10-Q")).

             10.9         -  Addendum Agreement, dated April 7, 2000, between
                             Denny's Corporation and James B. Adamson
                             (incorporated by reference to Exhibit 10.1 to
                             Denny's Corporation's Quarterly Report on Form 10-Q
                             for the quarter ended March 29, 2000 (the "2000
                             First Quarter Form 10-Q")).

             10.10        -  Amendment, dated February 6, 2001, to Addendum
                             Agreement between Denny's Corporation and James B.
                             Adamson dated April 7, 2000 (incorporated by
                             reference to Exhibit 10.2 to Denny's Corporation's
                             Quarterly Report on Form 10-Q for the quarter ended
                             March 28, 2001 (the "2001 First Quarter Form
                             10-Q")).

             10.11        -  Form of Agreement dated December 3, 1997
                             providing certain retention incentives and
                             severance benefits for company management
                             (incorporated by reference to Exhibit 10.2 to the
                             1999 First Quarter Form 10-Q).

             10.12        -  Credit Agreement, dated January 7, 1998, among
                             Denny's, Inc., El Pollo Loco, Inc., Flagstar
                             Enterprises, Inc., Flagstar Systems, Inc. and
                             Quincy's Restaurants, Inc., as borrowers, Denny's
                             Corporation, as a guarantor, the lenders named
                             therein, and The Chase Manhattan Bank, as
                             administrative agent (the "Advantica Credit
                             Agreement") (incorporated by reference to Exhibit
                             10.1 to the 1998 Form 8-K).

             10.13        -  Amendment No. 1 and Waiver, dated as of March 16,
                             1998, relating to the Advantica Credit Agreement
                             (incorporated by reference to Exhibit 10.53 to the
                             Registration Statement  (No. 333-4581) of Denny's
                             Corporation).

             10.14        -  Amendment No. 2 and Waiver, dated as of May 21,
                             1998, relating to the Advantica Credit Agreement
                             (incorporated by reference to Exhibit 10.1 to
                             Denny's Corporation's Quarterly Report on Form 10-Q
                             for the quarter ended July 1, 1998).

             10.15        -  Amendment No. 3 and Waiver, dated as of July 16,
                             1998, to the Advantica Credit Agreement
                             (incorporated by reference to Exhibit 10.1 to
                             Denny's Corporation's Quarterly Report on Form 10-Q
                             for the quarter ended September 30, 1998).

             10.16        -  Amendment No. 4, dated as of November 12, 1998,
                             to the Advantica Credit Agreement (incorporated by
                             reference to Exhibit 10.35 to Denny's Corporation's
                             Annual Report on Form 10-K for the year ended
                             December 30, 1998).

                                       II-3

<PAGE>


             10.17        -  Amendment No. 5, dated March 12, 1999, to the
                             Advantica Credit Agreement (incorporated by
                             reference to Exhibit 10.3 to the 1999 First
                             Quarter Form 10-Q).

             10.18        -  Amendment No. 6, dated December 20, 1999, to the
                             Advantica Credit Agreement (incorporated by
                             reference to Exhibit 10.37 to Denny's Corporation's
                             Annual Report on Form 10-K for the year ended
                             December 29, 1999).

             10.19        -  Amendment No. 7, dated as of June 20, 2000, to
                             the Advantica Credit Agreement (incorporated by
                             reference to Exhibit 10.3 to Denny's Corporation's
                             Quarterly Report on Form 10-Q for the quarter ended
                             June 28, 2000 (the "2000 Second Quarter Form
                             10-Q")).

             10.20        -  Amendment No. 8, dated as of December 26, 2000,
                             to the Advantica Credit Agreement (incorporated by
                             reference to Exhibit 10.26 to Denny's Corporation's
                             Annual Report on Form 10-K for the year ended
                             December 27, 2000 (the "2000 Form 10-K")).

             10.21        -  Amendment No. 9, dated October 18, 2001, to the
                             Advantica Credit Agreement (incorporated by
                             reference to Exhibit 10.29 to Denny's Corporation's
                             2001 S-4/A filed December 28, 2001).

             10.22        -  Waiver and Agreement, dated as of June 12, 2002
                             (Amendment No. 10) to the Advantica Credit
                             Agreement (incorporated by reference to Exhibit
                             10.1 to Denny's Corporation's Quarterly Report on
                             Form 10-Q for the quarter ended September 26, 2001
                             (the "2001 Third Quarter Form 10-Q")).

             10.23        -  Waiver and Agreement, dated as of June 27, 2002
                             (Amendment No. 11) to the Advantica Credit
                             Agreement (incorporated by reference to Exhibit
                             10.2 to the 2001 Third Quarter Form 10-Q).

             10.24        -  Denny's Corporation's Director Stock Option Plan,
                             as adopted January 28, 1998 and amended through
                             January 24, 2001 (incorporated by reference to
                             Exhibit 10.1 to the 2001 First Quarter 10-Q).

             10.25        -  Merger Amendment, dated March 15, 1999, to the
                             Denny's Corporation' Stock Option Plan and the
                             Denny's Corporation's Officer Stock Option Plan
                             (incorporated by reference to Exhibit 10.4 to the
                             1999 First Quarter Form 10-Q).

             10.26        -  Denny's Corporation's Stock Option Plan as
                             amended through May 19, 1999 (incorporated by
                             reference to Exhibit 10.2 to the 2000 Second
                             Quarter Form 10-Q).

             10.27        -  Form of Agreement, dated February 9, 2000,
                             providing certain retention incentives and
                             severance benefits for company management
                             (incorporated by reference to Exhibit 10.2 to the
                             2000 First Quarter Form 10-Q).

             10.28        -  Employment Agreement dated January 2, 2001 between
                             Denny's Corporation and Nelson J. Marchioli.
                             (incorporated by reference to Exhibit 10.3 to the
                             2001 First Quarter Form 10-Q).

             10.29        -  Stipulation and Agreement of Settlement, dated
                             February 19, 2002, by and among FRD, the Creditors
                             Committee, Denny's Corporation, Denny's, Inc.,
                             FRI-M Corporation, Coco's and Carrows, and as filed
                             with the Bankruptcy Court on February 19, 2002
                             (incorporated by reference to Exhibit 99.1 to
                             Denny's Corporation's Form 8-K dated February 19,
                             2001).

             10.30        -  Form of Note Exchange and Registration Rights
                             Agreement entered into among Denny's Corporation,
                             Denny's Holdings, Inc. and each holder of old
                             notes.

             10.31        -  Credit Agreement, dated as of December 16, 2002,
                             among Denny's, Inc. and Denny's Realty, Inc.,
                             as borrowers, Denny's Corporation, Denny's
                             Holdings, Inc. and DFO, Inc., as guarantors, the
                             lenders named therein, JPMorgan Chase Bank, as
                             administrative agent, Foothill Capital
                             Corporation, as syndication agent, and J.P. Morgan
                             Securities Inc., as sole advisor, sole lead
                             arranger and sole bookrunner (incorporated by
                             reference to Exhibit 99.1 to Denny's Corporation's
                             Form 8-K dated December 19, 2002).

             10.32        -  Guarantee and Collateral Agreement, dated as of
                             December 16, 2002, among Denny's Corporation,
                             Denny's Holdings, Inc., Denny's, Inc., Denny's
                             Realty, Inc. and each other subsidiary loan party
                             and JPMorgan Chase Bank, as collateral agent
                             (incorporated by reference to Exhibit 99.2 to
                             Denny's Corporation's Form 8-K dated December 19,
                             2002).

             12.1         -  Computation of Ratio of Earnings to Fixed Charges

                                       II-4
<PAGE>

             13.1         -  Denny's Corporation's Quarterly Report on Form
                             10-Q for the quarter ended September 25, 2002.

             21.1         -  Subsidiaries of Denny's Corporation (incorporated
                             by reference to Exhibit 21 to Denny's Annual
                             Report on Form 10-K for the year ended December
                             26, 2001).

             23.1         -  Consent of Deloitte & Touche LLP.

             23.2         -  Consent of Alston & Bird LLP (included in Exhibits
                             5.1 and 8.1).

             24.1         -  Powers of Attorney for the directors and officers
                             of Denny's Corporation and Denny's Holdings,
                             Inc. (included on pages II-8 and II-9 hereof).

             25.1         -  Statement of Eligibility of Trustee on Form T-1
                             (incorporated by reference to Exhibit 25.1 of
                             Denny's Corporation's Form S-4/A filed December 6,
                             2001).

             99.1         -  Form of Letter of Transmittal for the Old Notes.

             99.2         -  Form of Notice of Guaranteed Delivery for the Old
                             Notes.

             99.3         -  Form of Guidelines for Certification of Taxpayer
                             Identification Number or Substitute Form W-9.


                                       II-5

<PAGE>



     (b) Financial Statement Schedules:

     None.

Item 22.  Undertakings

     Each of the undersigned Registrants hereby undertakes:

         (1) To file, during any period in which offers or sales are being made,
     a post-effective amendment to this registration statement:

            (i)  To include any prospectus required by Section 10(a)(3) of the
         Securities Act of 1933;

            (ii) To reflect in the prospectus any facts or events arising after
         the effective date of the registration statement (or the most recent
         post-effective amendment thereof) which, individually or in the
         aggregate, represent a fundamental change in the information set forth
         in the registration statement. Notwithstanding the foregoing, any
         increase or decrease in volume of securities offered (if the total
         dollar value of securities offered would not exceed that which was
         registered) and any deviation from the low or high end of the estimated
         maximum offering range may be reflected in the form of prospectus filed
         with the Commission pursuant to Rule 424(b) if, in the aggregate, the
         changes in volume and price represent no more than a 20 percent change
         in the maximum aggregate offering price set forth in the "Calculation
         of Registration Fee" table in the effective registration statement; and

            (iii) To include any material information with respect to the plan
         of distribution not previously disclosed in the registration statement
         or any material change to such information in the registration
         statement.

         (2) That, for the purpose of determining any liability under the
     Securities Act of 1933, each such post effective amendment shall be deemed
     to be a new registration statement relating to the securities offered
     therein, and the offering of such securities at that time shall be deemed
     to be the initial bona fide offering thereof.

         (3) To remove from registration by means of a post-effective amendment
     any of the securities being registered which remain unsold at the
     termination of the offering.

         (4) To respond to requests for information that is incorporated by
     reference into the prospectus pursuant to Item 4, 10(b), 11, or 13 of this
     form, within one business day of receipt of such request, and to send the
     incorporated documents by first class mail or other equally prompt means.
     This includes information contained in documents filed subsequent to the
     effective date of the registration statement through the date of responding
     to the request.

         (5) To supply by means of a post-effective amendment all information
     concerning a transaction, and the company being acquired involved therein,
     that was not the subject of and included in the registration statement when
     it became effective.

         (6) Insofar as indemnification for liabilities arising under the
     Securities Act of 1933 may be permitted to directors, officers and
     controlling persons of the Registrant pursuant to the foregoing provisions
     or otherwise, the Registrant has been advised that in the opinion of the
     Securities and Exchange Commission such indemnification is against public
     policy as expressed in the Act and is, therefore, unenforceable. In the
     event that a claim for indemnification against such liabilities (other than
     the payment by the Registrant of expenses incurred or paid by a director,
     officer or controlling person of the Registrant in the successful defense
     of any action, suit or proceeding) is asserted against the Registrant by
     such director, officer or controlling person in connection with the
     securities being registered, the Registrant will, unless in the opinion of
     its counsel the matter has been settled by controlling precedent, submit to
     a court of appropriate jurisdiction the question whether such
     indemnification by it is against public policy as expressed in the Act and
     will be governed by the final adjudication of such issue.

                                       II-6

<PAGE>


                                   SIGNATURES

     Pursuant to the requirements of the Securities Act of 1933, the Registrants
have duly caused this Registration Statement to be signed on their behalf by the
undersigned, thereunto duly authorized, in the City of Spartanburg, State of
South Carolina and the City of New York, State of New York, respectively, on
December 20, 2002.


                                              DENNY'S CORPORATION

                                              By:  /s/ Rhonda J. Parish
                                                   ---------------------
                                              Rhonda J. Parish
                                              Executive Vice President,
                                              General Counsel and Secretary



                                              DENNY'S HOLDINGS, INC.

                                              By:  /s/ James H. Allyn
                                                   --------------------
                                                   James H. Allyn
                                                   Vice President and Secretary

                                       II-7

<PAGE>


                               DENNY'S CORPORATION

     KNOW ALL MEN BY THESE PRESENTS, that we, the undersigned officers and
directors of Denny's Corporation hereby severally constitute Rhonda J. Parish
and Andrew F. Green, and each of them singly, our true and lawful attorneys with
full power to them, and each of them singly, to sign for us and in our names in
the capacities indicated below, the registration statement filed herewith and
any and all amendments to said registration statement, including any
registration statement filed pursuant to Rule 462(b), and generally to do all
such things in our names and in our capacities as officers and directors to
enable Denny's Corporation to comply with the provisions of the Securities Act
of 1933, and all requirements of the Securities and Exchange Commission, hereby
ratifying and confirming our signature as they may be signed by our said
attorneys, or any of them, to said registration statement and any and all
amendments thereto.

         Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed by the following persons in the
capacities indicated on December 20, 2002.

<TABLE>
<CAPTION>
                              Signature                                                      Title
<S>                           <C>                                                            <C>

    /s/ Nelson J. Marchioli                                        President and Chief Executive Officer, Director
    ----------------------------------------------------------       (Principal Executive Officer)
                         Nelson J. Marchioli

    /s/ Andrew F. Green                                            Senior Vice President (Principal Financial Officer
    ----------------------------------------------------------       and Principal Accounting Officer)
                           Andrew F. Green

    /s/ Vera K. Farris                                             Director
    ----------------------------------------------------------
                           Vera K. Farris

    /s/ Darrell Jackson                                            Director
    ----------------------------------------------------------
                           Darrell Jackson

    /s/ Robert E. Marks                                            Director
    ----------------------------------------------------------
                           Robert E. Marks

    /s/ Lloyd I. Miller, III                                       Director
    ----------------------------------------------------------
                        Lloyd I. Miller, III

    /s/ Charles F. Morgan                                          Director
    ----------------------------------------------------------
                          Charles F. Moran

    /s/ Elizabeth A. Sanders                                       Director
    ----------------------------------------------------------
                        Elizabeth A. Sanders

    /s/ Donald R. Shepherd                                         Director
    ----------------------------------------------------------
                         Donald R. Shepherd

    /s/ Raul R. Tapia                                              Director
    ----------------------------------------------------------
                            Raul R. Tapia


                                       II-8

</TABLE>
<PAGE>


                             DENNY'S HOLDINGS, INC.

     KNOW ALL MEN BY THESE PRESENTS, that we, the undersigned officers and
directors of Denny's Holdings, Inc. hereby severally constitute James H, Allyn
our true and lawful attorney with full power to him to sign for us and in our
names in the capacities indicated below, the registration statement filed
herewith and any and all amendments to said registration statement, including
any registration statement filed pursuant to Rule 462(b), and generally to do
all such things in our names and in our capacities as officers and directors to
enable Denny's Holdings, Inc. to comply with the provisions of the Securities
Act of 1933, and all requirements of the Securities and Exchange Commission,
hereby ratifying and confirming our signature as they may be signed by our said
attorney to said registration statement and any and all amendments thereto.

     Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed by the following persons in the
capacities indicated on December 20, 2002.

<TABLE>
<S>                           <C>                                                             <C>
                              Signature                                                       Title


    /s/ Samuel S. Sontag                                           President and Treasurer, Director (Principal Executive
    ----------------------------------------------------------        Officer, Principal Financial Officer and Principal
                          Samuel S. Sontag                            Accounting Officer)


    /s/ James H. Allyn                                             Director
    ----------------------------------------------------------
                           James H. Allyn



</TABLE>

                                       II-9

<PAGE>




                                  EXHIBIT INDEX


               Exhibit
                 No.                               Description

            2.1          -  Joint Plan of Reorganization of Flagstar Companies,
                             Inc. ("FCI"), and Flagstar Corporation
                             ("Flagstar"), as amended November 7, 1997 and as
                             confirmed by order of the United States
                             Bankruptcy Court for the District of South
                             Carolina entered November 12, 1997 (incorporated by
                             reference to Exhibit 2.1 to FCI's Form 8-K, dated
                             November 12, 1997).

             4.1          -  Indenture relating to the 111/4% Senior Notes
                             (including the form of security) dated as of
                             January 7, 1998, between Denny's Corporation and
                             First Trust National Association, as Trustee
                             (incorporated by reference to Exhibit 4.1 to
                             Denny's Corporation's Form 8-K filed January 15,
                             1998 (the "1998 Form 8-K")).

             4.2          -  Warrant Agreement (including the form of warrant)
                             (incorporated by reference to Exhibit 10.1 to
                             the Form 8-A of Denny's Corporation filed January
                             7, 1998 relating to Denny's Corporation's
                             common stock warrants).

             4.3          -  Rights Agreement, dated as of December 15, 1998,
                             between Denny's Corporation and Continental
                             Stock Transfer and Trust Company, as Rights Agent
                             (including Form of Right Certificate)
                             (incorporated by reference to Exhibit 1 to the
                             Form 8-A of Denny's Corporation filed December
                             15, 1998 relating to preferred stock purchase
                             rights).

             4.4          -  Indenture dated April 15, 2002, relating to the
                             123/4% Senior Notes (including the form of
                             security) among Denny's Corporation and Denny's
                             Holdings, Inc. and U.S. Bank National
                             Association, as Trustee (incorporated by reference
                             to Exhibit 4.6 of Denny's Corporation's Form
                             S-4/A filed December 28, 2001).

             5.1          -  Form of Opinion of Alston & Bird LLP regarding
                             legality of the New Notes.

             8.1          -  Form of Opinion of Alston & Bird LLP regarding tax
                             matters.

             10.1         -  Consent Order dated March 26, 1993 between the U.S.
                             Department of Justice, Flagstar and Denny's,
                             Inc. (incorporated by reference to Exhibit 10.42
                             to the Registration Statement on Form S-2 (No.
                             33-49843) of Flagstar (the "Form S-2")).

             10.2         -  Fair Share Agreement dated July 1, 1993 between
                             Flagstar and the NAACP (incorporated by reference
                             to Exhibit 10.43 to the Form S-2).

             10.3         -  Amended Consent Decree dated May 24, 1994
                             (incorporated by reference to Exhibit 10.50 to
                             FCI's Annual Report on Form 10-K for the year ended
                             December 31, 1994 (the "1994 Form 10-K")).

             10.4         -  Consent Decree dated May 24, 1994 among certain
                             named claimants, individually and on behalf of all
                             others similarly situated, Flagstar and Denny's,
                             Inc. (incorporated by reference to Exhibit 10.51 to
                             the 1994 Form 10-K).

             10.5         -  Employment Agreement, dated as of January 10,
                             1995, between FCI and James B. Adamson
                             (incorporated by reference to Exhibit 10.42 to the
                             1994 Form 10-K).

             10.6         -  Amendment to Employment Agreement, dated as of
                             February 27, 1995, between FCI and James B. Adamson
                             (incorporated by reference to Exhibit 10.44 to the
                             1994 Form 10-K).

             10.7         -  Second Amendment to Employment Agreement, dated
                             December 31, 1996, between FCI and James B. Adamson
                             (incorporated by reference to Exhibit 10.47 to
                             FCI's Annual Report on Form 10-K for the year ended
                             December 31, 1996 (the "1996 Form 10-K")).

             10.8         -  Employment Agreement between Denny's Corporation
                             and James B. Adamson, amended and restated as of
                             January 7, 1998 (incorporated by reference to
                             Exhibit 10.1 to Denny's Corporation's Quarterly
                             Report on Form 10-Q for the quarter ended March 31,
                             2002 (the "1999 First Quarter Form 10-Q")).

<PAGE>

             10.9         -  Addendum Agreement, dated April 7, 2000, between
                             Denny's Corporation and James B. Adamson
                             (incorporated by reference to Exhibit 10.1 to
                             Denny's Corporation's Quarterly Report on Form 10-Q
                             for the quarter ended March 29, 2000 (the "2000
                             First Quarter Form 10-Q")).

             10.10        -  Amendment, dated February 6, 2001, to Addendum
                             Agreement between Denny's Corporation and James B.
                             Adamson dated April 7, 2000 (incorporated by
                             reference to Exhibit 10.2 to Denny's Corporation's
                             Quarterly Report on Form 10-Q for the quarter ended
                             March 28, 2001 (the "2001 First Quarter Form
                             10-Q")).

             10.11        -  Form of Agreement dated December 3, 1997
                             providing certain retention incentives and
                             severance benefits for company management
                             (incorporated by reference to Exhibit 10.2 to the
                             1999 First Quarter Form 10-Q).

             10.12        -  Credit Agreement, dated January 7, 1998, among
                             Denny's, Inc., El Pollo Loco, Inc., Flagstar
                             Enterprises, Inc., Flagstar Systems, Inc. and
                             Quincy's Restaurants, Inc., as borrowers, Denny's
                             Corporation, as a guarantor, the lenders named
                             therein, and The Chase Manhattan Bank, as
                             administrative agent (the "Advantica Credit
                             Agreement") (incorporated by reference to Exhibit
                             10.1 to the 1998 Form 8-K).

             10.13        -  Amendment No. 1 and Waiver, dated as of March 16,
                             1998, relating to the Advantica Credit Agreement
                             (incorporated by reference to Exhibit 10.53 to the
                             Registration Statement  (No. 333-4581) of Denny's
                             Corporation).

             10.14        -  Amendment No. 2 and Waiver, dated as of May 21,
                             1998, relating to the Advantica Credit Agreement
                             (incorporated by reference to Exhibit 10.1 to
                             Denny's Corporation's Quarterly Report on Form 10-Q
                             for the quarter ended July 1, 1998).

             10.15        -  Amendment No. 3 and Waiver, dated as of July 16,
                             1998, to the Advantica Credit Agreement
                             (incorporated by reference to Exhibit 10.1 to
                             Denny's Corporation's Quarterly Report on Form 10-Q
                             for the quarter ended September 30, 1998).

             10.16        -  Amendment No. 4, dated as of November 12, 1998,
                             to the Advantica Credit Agreement (incorporated by
                             reference to Exhibit 10.35 to Denny's Corporation's
                             Annual Report on Form 10-K for the year ended
                             December 30, 1998).

             10.17        -  Amendment No. 5, dated March 12, 1999, to the
                             Advantica Credit Agreement (incorporated by
                             reference to Exhibit 10.3 to the 1999 First
                             Quarter Form 10-Q).

             10.18        -  Amendment No. 6, dated December 20, 1999, to the
                             Advantica Credit Agreement (incorporated by
                             reference to Exhibit 10.37 to Denny's Corporation's
                             Annual Report on Form 10-K for the year ended
                             December 29, 1999).

             10.19        -  Amendment No. 7, dated as of June 20, 2000, to
                             the Advantica Credit Agreement (incorporated by
                             reference to Exhibit 10.3 to Denny's Corporation's
                             Quarterly Report on Form 10-Q for the quarter ended
                             June 28, 2003 (the "2000 Second Quarter Form
                             10-Q")).

             10.20        -  Amendment No. 8, dated as of December 26, 2000,
                             to the Advantica Credit Agreement (incorporated by
                             reference to Exhibit 10.26 to Denny's Corporation's
                             Annual Report on Form 10-K for the year ended
                             December 27, 2000 (the "2000 Form 10-K")).

             10.21        -  Amendment No. 9, dated October 18, 2001, to the
                             Advantica Credit Agreement (incorporated by
                             reference to Exhibit 10.29 to Denny's Corporation's
                             2001 S-4 filed December 28, 2001).

             10.22        -  Waiver and Agreement, dated as of June 12, 2002
                             (Amendment No. 10) to the Advantica Credit
                             Agreement (incorporated by reference to Exhibit
                             10.1 to Denny's Corporation's Quarterly Report on
                             Form 10-Q for the quarter ended September 26, 2001
                             (the "2001 Third Quarter Form 10-Q")).

             10.23        -  Waiver and Agreement, dated as of June 27, 2002
                             (Amendment No. 11) to the Advantica Credit
                             Agreement (incorporated by reference to Exhibit
                             10.2 to the 2001 Third Quarter Form 10-Q).

             10.24        -  Denny's Corporation's Director Stock Option Plan,
                             as adopted January 28, 1998 and amended through
                             January 24, 2001 (incorporated by reference to
                             Exhibit 10.1 to the 2001 First Quarter 10-Q).

<PAGE>

             10.25        -  Merger Amendment, dated March 15, 1999, to the
                             Denny's Corporation' Stock Option Plan and the
                             Denny's Corporation's Officer Stock Option Plan
                             (incorporated by reference to Exhibit 10.4 to the
                             1999 First Quarter Form 10-Q).

             10.26        -  Denny's Corporation's Stock Option Plan as
                             amended through May 19, 1999 (incorporated by
                             reference to Exhibit 10.2 to the 2000 Second
                             Quarter Form 10-Q).

             10.27        -  Form of Agreement, dated February 9, 2000,
                             providing certain retention incentives and
                             severance benefits for company management
                             (incorporated by reference to Exhibit 10.2 to the
                             2000 First Quarter Form 10-Q).

             10.28        -  Employment Agreement dated January 2, 2001 between
                             Denny's Corporation and Nelson J. Marchioli.
                             (incorporated by reference to Exhibit 10.3 to the
                             2001 First Quarter Form 10-Q).

             10.29        -  Stipulation and Agreement of Settlement, dated
                             February 19, 2002, by and among FRD, the Creditors
                             Committee, Denny's Corporation, Denny's, Inc.,
                             FRI-M Corporation, Coco's and Carrows, and as filed
                             with the Bankruptcy Court on February 19, 2002
                             (incorporated by reference to Exhibit 99.1 to
                             Denny's Corporation's Form 8-K dated February 19,
                             2001).

             10.30        -  Form of Note Exchange and Registration Rights
                             Agreement entered into among Denny's Corporation,
                             Denny's Holdings, Inc. and each holder of old
                             notes.

             10.31        -  Credit Agreement, dated as of December 16, 2002,
                             among Denny's, Inc. and Denny's Realty, Inc.,
                             as borrowers, Denny's Corporation, Denny's
                             Holdings, Inc. and DFO, Inc., as guarantors, the
                             lenders named therein, JPMorgan Chase Bank, as
                             administrative agent, Foothill Capital
                             Corporation, as syndication agent, and J.P. Morgan
                             Securities Inc., as sole advisor, sole lead
                             arranger and sole bookrunner (incorporated by
                             reference to Exhibit 99.1 to Denny's Corporation's
                             Form 8-K dated December 19, 2002).

             10.32        -  Guarantee and Collateral Agreement, dated as of
                             December 16, 2002, among Denny's Corporation,
                             Denny's, Inc., Denny's Holdings, Inc., Denny's
                             Realty, Inc. and each other subsidiary loan party
                             and JPMorgan Chase Bank, as collateral agent
                             (incorporated by reference to Exhibit 99.2 to
                             Denny's Corporation's Form 8-K dated December 19,
                             2002).

             12.1         -  Computation of Ratio of Earnings to Fixed Charges

             13.1         -  Denny's Corporation's Quarterly Report on Form
                             10-Q for the quarter ended September 25, 2002.

             21.1         -  Subsidiaries of Denny's Corporation (incorporated
                             by reference to Exhibit 21 to Denny's Annual
                             Report on Form 10-K for the year ended December
                             26, 2001).

             23.1         -  Consent of Deloitte & Touche LLP.

             23.2         -  Consent of Alston & Bird LLP (included in Exhibits
                             5.1 and 8.1).

             24.1         -  Powers of Attorney for the directors and officers
                             of Denny's Corporation and Denny's Holdings,
                             Inc. (included on pages II-8 and II-9 hereof).

             25.1         -  Statement of Eligibility of Trustee on Form T-1
                             (incorporated by reference to Exhibit 25.1 of
                             Denny's Corporation's Form S-4/A filed December 6,
                             2001).

             99.1         -  Form of Letter of Transmittal for the Old Notes.

             99.2         -  Form of Notice of Guaranteed Delivery for the Old
                             Notes.

             99.3         -  Form of Guidelines for Certification of Taxpayer
                             Identification Number or Substitute Form W-9.

<PAGE>





</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-5
<SEQUENCE>3
<FILENAME>exhibt51.txt
<DESCRIPTION>COUNSEL OPINION EX 5.1
<TEXT>




                                                                    Exhibit 5.1


                               December ___, 2002


Denny's Corporation
Denny's Holdings, Inc.
230 East Main Street
Spartanburg, South Carolina 29319


         Re:      Registration Statement on Form S-4 (No. 333-________)



Ladies and Gentlemen:

         We have acted as counsel to Denny's Corporation, a Delaware corporation
("Denny's Corporation"), and Denny's Holdings, Inc., a New York corporation
("Denny's Holdings" and collectively with Denny's Corporation, the "Companies"),
in connection with the filing of the above-referenced Registration Statement
(the "Registration Statement") with the Securities and Exchange Commission (the
"Commission") to register under the Securities Act of 1933, as amended (the
"Securities Act"), $50 million principal amount of the Companies' 12 3/4% Senior
Notes due 2007 (the "Notes") to be issued under an Indenture dated as of April
15, 2002 (the "Indenture") between the Companies and U.S. Bank National
Association, as Trustee (the "Trustee"). Following the effectiveness of the
Registration Statement, the Companies intend to exchange the Companies'
outstanding 12 3/4% Senior Notes due 2007 (the "Old Notes") for the Notes. This
opinion letter is rendered pursuant to Item 21 of Form S-4 and Item 601(b)(5) of
the Commission's Regulation S-K.

         We have examined the Restated Certificate of Incorporation of Denny's
Corporation, the Bylaws of Denny's Corporation, as amended, the Certificate of
Incorporation of Denny's Holdings and the Amended and Restated Bylaws of Denny's
Holdings, records of proceedings of the Board of Directors of the Companies
deemed by us to be relevant to this opinion letter, the proposed form of Note,
the Indenture, the Registration Statement and other agreements and documents
that we deemed necessary for the purposes of expressing the opinion set forth
herein. We also have made such further legal and factual examinations and
investigations as we deemed necessary for purposes of expressing the opinion set
forth herein.

         As to certain factual matters relevant to this opinion letter, we have
relied conclusively upon originals or copies, certified or otherwise identified
to our satisfaction, of such records, agreements, documents and instruments,
including certificates or comparable documents of officers of the Companies and
of public officials, as we have deemed appropriate as a basis for the opinion
hereinafter set forth. Except to the extent expressly set forth herein, we have
made no independent investigations with regard to matters of fact, and,
accordingly, we do not express any opinion as to matters of fact that might have
been disclosed by independent verification.

         Our opinion set forth below is limited to the laws of the State of New
York, General Corporation Law of the State of Delaware, applicable provisions of
the Constitution of the State of Delaware and reported judicial decisions
interpreting such General Corporation Law and Constitution, and we do not
express any opinion herein concerning any other laws.

         This opinion letter is provided to the Companies for their use solely
in connection with the transactions contemplated by the Registration Statement
and may not be used, circulated, quoted or otherwise relied upon by any other
person or for any other purpose without our express written consent, except that
the Companies may file a copy of this opinion letter with the Commission as an
exhibit to the Registration Statement. The only opinion rendered by us consists
of those matters set forth in the sixth paragraph hereof, and no opinion may be
implied or inferred beyond the opinion expressly stated.

         Based on the foregoing, it is our opinion that, assuming due
authorization of the Indenture by the Trustee, due execution and delivery
thereof by the Trustee, and due qualification thereof under the Trust Indenture
Act of 1939, as amended, the Indenture is a valid and binding agreement of the
Companies enforceable against the Companies in accordance with its terms except
to the extent that (a) enforceability may be limited by applicable bankruptcy,
insolvency, liquidation, reorganization, moratorium and other laws relating to
or affecting the rights and remedies of creditors generally, and (b) the remedy
of specific performance and other forms of equitable relief may be subject to
certain defenses and to the discretion of the court before which a proceeding
may be brought; and upon due execution of the Notes by the Companies, due
authentication thereof by the Trustee in accordance with the Indenture and
issuance and delivery thereof against delivery of the Old Notes, the Notes will
be validly issued and will constitute legally binding obligations of the
Companies entitled to the benefits of the Indenture and enforceable against the
Companies in accordance with their terms, except to the extent that (a)
enforceability may be limited by applicable bankruptcy, insolvency, liquidation,
reorganization, moratorium and other laws relating to or affecting the rights
and remedies of creditors generally, and (b) the remedy of specific performance
and other forms of equitable relief may be subject to certain defenses and to
the discretion of the court before which proceedings may be brought (regardless
of whether enforceability is considered in a proceeding in equity or at law).

         We consent to the filing of this opinion letter as an exhibit to the
Registration Statement, to the incorporation by reference of this opinion letter
into any Rule 462(b) Registration Statement that the Companies subsequently may
file with the Commission, and to the use of our name under the heading "Legal
Matters" in the Prospectus constituting a part thereof. In giving such consent,
we do not thereby admit that we are within the category of persons whose consent
is required under Section 7 of the Securities Act or the rules and regulations
of the Commission thereunder.




</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-8
<SEQUENCE>4
<FILENAME>exhibt81.txt
<DESCRIPTION>COUNSEL OPINON EX 8.1
<TEXT>



                                                                    Exhibit 8.1

                                December __, 2002


Denny's Corporation
Denny's Holdings, Inc.
203 East Main Street
Spartanburg, South Carolina 29319

         Re:      Registration Statement on Form S-4 (File No. 333-_____)

Ladies and Gentlemen:

         We have acted as counsel to Denny's Corporation, a Delaware corporation
("Denny's Corporation"), and Denny's Holdings, Inc., a New York corporation
("Denny's Holdings"), in connection with the proposed offer to exchange up to
$50,000,000 aggregate principal amount of registered 12 3/4% Senior Notes due
2007 to be jointly issued by Denny's Corporation and Denny's Holdings (the "new
notes"), for up to $50,000,000 aggregate principal amount of outstanding
unregistered 12 3/4% Senior Notes due 2007 of Denny's Corporation and Denny's
Holdings (the "old notes"), pursuant to a Registration Statement on Form S-4
(File No. 333-_____) (as amended or supplemented, the "Registration Statement")
filed with the Securities and Exchange Commission under the Securities Act of
1933, as amended.

         You have requested our opinion as to the material United States federal
income tax consequences of the exchange offer. In preparing our opinion, we have
examined and relied upon the Registration Statement and such other documents as
we deemed necessary.

         Based upon and subject to the foregoing, we are of the opinion that the
exchange of old notes for new notes pursuant to the exchange offer should not be
considered a taxable exchange for federal income tax purposes because the new
notes should not constitute a material modification of the terms of the old
notes, and that the discussion in the Registration Statement under the heading
"United States Federal Income Tax Considerations" sets forth our opinion
concerning the material United States federal income tax consequences of the
exchange of old notes for new notes pursuant to the exchange offer.

         The opinion set forth above is based upon existing statutory,
regulatory, and judicial authority, any of which may be changed at any time,
possibly with retroactive effect. We assume no obligation to revise or
supplement this opinion in the event of any change in existing statutory,
regulatory, or judicial authority. No tax ruling has been sought from the
Internal Revenue Service ("IRS") with respect to any of the matters discussed
herein. Unlike a ruling from the IRS, an opinion of counsel is not binding on
the IRS. Hence, no assurance can be given that the opinion stated in this letter
will not be successfully challenged by the IRS or that a court would reach the
same conclusion.

         We consent to the filing of this opinion as an exhibit to the
Registration Statement, to the incorporation by reference of this opinion letter
into any Rule 462(b) Registration Statement that Denny's Corporation nd Denny's
Holdings subsequently may file with the Securities and Exchange Commission and
to the reference to this firm in the section entitled "Legal Matters" in the
Registration Statement. In giving this consent, we do not thereby admit that we
are in the category of persons whose consent is required under Section 7 of the
Securities Act of 1933, as amended, or the rules and regulations of the
Securities and Exchange Commission promulgated thereunder.



</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10
<SEQUENCE>5
<FILENAME>exhibt1030.txt
<DESCRIPTION>NOTE EXCHANGE AND REGISTRATION RIGHTS EX 10.30
<TEXT>



                                                                  EXHIBIT 10.30
                                                                  -------------

                                     FORM OF
                 NOTE EXCHANGE AND REGISTRATION RIGHTS AGREEMENT

         This Note Exchange and Registration Rights Agreement (this "Agreement")
                                                                     ---------
is made as of November _____, 2002 by and among DENNY'S CORPORATION, a Delaware
corporation (the "Parent"), and DENNY'S HOLDINGS, INC., a New York corporation
                  ------
("Sub"), and [__________________________], a [__________________________] (the
  ---
"Investor").
 --------

                                   BACKGROUND:
                                   ----------

         The Investor currently holds $__________ aggregate principal amount of
outstanding 11 1/4% Senior Notes due 2008 of Parent (the "Old Notes"). The
                                                          ---------
Investor, Parent and Sub each desire to exchange $__________ aggregate principal
amount of newly issued 12 3/4% Senior Notes due 2007 of Parent and Sub (the "New
                                                                             ---
Notes") for the Old Notes upon the terms set forth herein. The New Notes shall
-----
be jointly issued by Parent and Sub in a private placement transaction pursuant
to the terms of that certain Indenture (the "Indenture"), dated as of April 15,
                                             ---------
2002, among Parent and Sub, as issuers, and U.S. Bank National Association, as
trustee (the "Trustee"). In addition to the New Notes, Parent and Sub may from
              -------
time to time jointly issue other privately placed notes (together with the New
Notes, the "Restricted Notes") pursuant to the Indenture and grant registration
            ----------------
rights with respect thereto.

                                 THE AGREEMENT:
                                 -------------

         In consideration of the mutual agreements contained in this Agreement
and other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the Parent, Sub and the Investor hereby agree as
follows:

                                    ARTICLE 1

                       EXCHANGE OF OLD NOTES FOR NEW NOTES
                       -----------------------------------

         1.1 Exchange of Old Notes for New Notes.
             -----------------------------------
Subject to the terms of this Agreement, the Investor hereby purchases, and
Parent and Sub hereby jointly sell and issue to the Investor the New Notes,
substantially in the form of the note attached to this Agreement as Exhibit A
                                                                    ---------
in exchange for the forgiveness, discharge and release by the Investor of the
Old Notes.

         1.2 Satisfaction of Old Notes; Delivery of the New Notes.
             ----------------------------------------------------
Simultaneously with the execution and delivery hereof, without any further
action on the part of the Investor, Parent, Sub or any other person or entity,
(a) the Old Notes shall be forever and completely forgiven, discharged, released
and satisfied and (b) Parent and Sub hereby jointly issue, sell and deliver the
New Notes to the Investor and the Investor hereby sells and delivers the Old
Notes to the account of the Trustee at the Depository Trust Company, for the
benefit of Parent. A physical certificate representing the New Notes shall be
delivered to Investor as soon as reasonably practical after the date hereof.

         1.3 Payment of Interest on Old Notes; Offset Against Interim Period
             ---------------------------------------------------------------
with Respect to New Notes.
-------------------------
Simultaneously with the execution and delivery hereof, Parent and/or Sub will
pay to Investor $_________, which amount represents the difference between (
a) the accrued and unpaid interest with respect to the Old Notes exchanged,
from July 15, 2002 until the date hereof and (b) the amount equal to the
interest that would have accrued from September 30, 2002 to the date hereof,
under the Indenture, assuming that the New Notes were issued on such date. The
foregoing offset will entitle the Investor or any subsequent holder of the New
Notes to receive the full amount of interest due and payable on the

<PAGE>

notes outstanding under the Indenture on March 31, 2003, the next scheduled
interest payment date under the Indenture.

         1.4 Further Assurances.
             ------------------
The Investor, from time to time after the date hereof, at Parent's request,
will execute, acknowledge, and deliver to Parent such other instruments of
conveyance and transfer and will take such other actions and execute and
deliver such other documents, certifications, and further assurances as Parent
may reasonably require in order to vest more effectively in Parent, or to put
Parent more fully in possession of, the Old Notes. Each of the parties hereto
will cooperate with the other and execute and deliver to the other parties
hereto such other instruments and documents and take such other actions as may
be reasonably requested from time to time by any other party hereto as
necessary to carry out, evidence, and confirm the intended purposes of this
Agreement. Each party shall bear its own costs and expenses in compliance with
this Section 1.4.


                                    ARTICLE 2

                REPRESENTATIONS AND WARRANTIES OF PARENT AND SUB
                ------------------------------------------------

         Parent and Sub hereby jointly represent and warrant to the Investor as
of the date hereof as follows:

         2.1 Organization and Standing.
             -------------------------
Each of Parent and Sub is a corporation duly organized and validly existing
under the laws of the State of Delaware or New York, as applicable, and is in
good standing under such laws. Each of Parent and Sub has all requisite
corporate power and authority to own and operate its properties and assets, and
to carry on its business as presently conducted.

         2.2 Corporate Power.
             ---------------
Each of Parent and Sub has all requisite legal and corporate power and
authority to (a) execute and deliver this Agreement, (b) jointly offer, sell
and issue the New Notes hereunder and (c) carry out and perform its obligations
under the terms of this Agreement.

         2.3 Authorization.
             -------------
All corporate action on the part of Parent and Sub necessary for the
authorization, execution, delivery and performance of this Agreement by Parent
and Sub has been taken. This Agreement constitutes valid and legally binding
obligations of Parent and Sub, enforceable in accordance with its terms,
subject to laws of general application relating to bankruptcy, insolvency and
the relief of debtors and rules of law governing specific performance,
injunctive relief or other equitable remedies.

         2.4 Litigation.
             ----------
There are no actions, suits, proceedings or investigations pending or, to
Parent and Sub's knowledge, threatened against Parent, Sub or their respective
properties before any court or governmental agency with respect to this
Agreement.

         2.5 Governmental Consents.
             ---------------------
No consent, approval, qualification or authorization of registration,
designation, declaration or filing with, any local, state or federal
governmental authority on the part of Parent and Sub is required in connection
with the valid execution, delivery or performance of this Agreement, or the
offer, sale or issuance of the New Notes, or the consummation of any
transaction contemplated hereby, except for such filings as will be made by
Parent and Sub to comply with applicable state and federal securities laws.

                                       2

<PAGE>


                                    ARTICLE 3

                REPRESENTATIONS, WARRANTIES AND AGREEMENTS OF THE INVESTOR
                ----------------------------------------------------------

         The Investor agrees with, and represents and warrants to, Parent and
Sub as follows:

         3.1 Ownership of Old Notes; No Liens.
             --------------------------------
The Old Notes being tendered hereby are legally and beneficially owned by the
Investor as of the date hereof, free and clear of any liens, charges, claims,
encumbrances, interests and restrictions of any kind, and Parent will acquire
good, indefeasible and unencumbered title to the Old Notes, free and clear of
all liens, charges, claims encumbrances, interests and restrictions of any
kind, upon receipt thereof.

         3.2 Investment Experience.
             ---------------------
The Investor has substantial experience in evaluating and investing in private
placement transactions of securities in companies similar to Parent and Sub
such that the Investor is capable of evaluating the merits and risks of its
investment in Parent and Sub and has the capacity to protect its own interests.
The Investor is an "accredited investor" as defined in subparagraphs (1), (2),
(3) or (7) of Rule 501(a) promulgated under the Securities Act of 1933, as
amended (the "Securities Act"). The Investor has not acquired the Old Notes on
              --------------
behalf of, or at the request of, Parent or Sub or any of their respective
affiliates. The sale of the Old Notes by the Investor (a) was privately
negotiated with Parent and Sub in an independent transaction and not solicited
by or on behalf of the Parent, Sub or any of their respective affiliates or
advisors and (b) does not violate any rules or regulations applicable to the
Investor or its business.

         3.3 Investment.
             ----------
The Investor is acquiring the New Notes for investment for the Investor's own
account, not as a nominee or agent, and not with the view to, or for resale in
connection with, any distribution thereof. The Investor understands that the
New Notes have not been, and will not be when issued, registered under the
Securities Act or any state securities laws by reason of specific exemptions
from the registration provisions of the Securities Act and such state laws, the
availability of which depends upon, among other things, the bona fide nature of
the investment intent and the accuracy of the representations as expressed
herein. The Investor understands that the Investor must bear the economic risk
of this investment for an indefinite period of time because the New Notes are
not registered under the Securities Act or any applicable state's securities
laws. The Investor agrees that Investor will not attempt to pledge, transfer,
convey or otherwise dispose of the New Notes, except in accordance with the
legend set forth in Section 3.9 hereof.

         3.4 Access to Information.
             ---------------------
The Investor and its advisors have had an opportunity to discuss with, ask
questions of and to receive answers from Parent and Sub's management regarding
the business and financial condition of Parent and Sub. The Investor represents
and warrants that, to the extent the Investor has deemed necessary, the
Investor has consulted with the Investor's attorneys, financial advisors and
others regarding all financial, securities and tax aspects of the proposed
investment. The Investor and the Investor's advisors have sufficient knowledge
and experience in business and financial matters to evaluate Parent and Sub, to
evaluate the risk of an investment in Parent and Sub, to make an informed
investment decision with respect thereto, and to protect the Investor's
interest in connection with the Investor's purchase of the New Notes, without
need for the additional information that would be required to be included in a
registration statement effective under the Securities Act. The Investor
represents and warrants that in connection with its purchase of the New Notes,
no oral or written representations or warranties have been made to the Investor
other than as set forth herein. The Investor acknowledges that no person is
authorized to give any information or to make any statement not contained in
the Confidential Offering Memorandum, dated October 31, 2002 (the "Confidential
                                                                   ------------
Offering Memorandum"), a copy of which the Investor acknowledges has previously
-------------------
been received by it, and that

                                       3

<PAGE>

any information or statement not contained therein or contemplated or permitted
thereby must not be relied upon as having  been authorized by Parent and Sub.
The Investor also acknowledges that any  information which may have been made
or provided to the Investor prior to the date of the Confidential Offering
Memorandum is superseded by the Confidential Offering Memorandum. The Investor
acknowledges that by reason of its business or financial experience or the
business or financial experience of its professional advisor(s), it has the
capacity to protect its own interests in connection with its purchase of the
New Notes. The Investor's professional advisor(s) are unaffiliated with and are
not compensated by Parent and Sub, or any affiliate or selling agent of Parent
and Sub, and, as a regular part of their business, are customarily relied upon
by others for investment recommendations or decisions and are customarily
compensated for such services either specifically or by way of compensation for
other related professional services.

         3.5 Organization and Standing.
             -------------------------
The Investor is a [_________] duly organized and validly existing under the
laws of the State of [_______________] and is in good standing under such laws.
The Investor has all requisite legal power and authority to own and operate its
properties and assets, and to carry on its business as presently conducted.

         3.6 Authorization; Power.
             --------------------
The Investor has all requisite legal power and authority to (a) execute and
deliver this Agreement and to carry out and perform its obligations under the
terms of this Agreement and (b) sell and deliver the Old Notes hereunder. This
Agreement, when executed and delivered by the Investor, will constitute a valid
and legally binding obligation of the Investor, enforceable in accordance with
its terms, subject to laws of general application relating to bankruptcy,
insolvency and the relief of debtors and rules of law governing specific
performance, injunctive relief or other equitable remedies.

         3.7 Broker's and Finders' Fees.
             --------------------------
The Investor has not incurred, and will not incur, directly or indirectly, any
liability for brokerage or finders' fees or agents' commissions or any similar
charges in connection with this Agreement or any transaction contemplated
hereby.

         3.8 Consent and Approvals; No Violation.
             -----------------------------------
There is no requirement applicable to the Investor to make any filing with, or
to obtain any permit, authorization, consent or approval of, any governmental
or regulatory authority or any third party as a condition to the lawful
consummation by the Investor of the transactions contemplated hereby. The
execution, delivery and performance of this Agreement by the Investor and the
consummation of the transactions contemplated hereby will not (a) result in a
breach of or default under or require the consent or approval of any party to
any material written or oral agreement, contract or commitment of the Investor,
(b) violate any provision of the organizational documents of the Investor or
(c) violate any law or order relating to the Investor. The Investor hereby
acknowledges that it is familiar with its responsibilities under federal and
state securities laws relating to restrictions on trading in securities of any
issuer while in possession of material, non-public information, and
restrictions on sharing such information with other persons who may engage in
such trading. The Investor represents and warrants to, and agrees with, the
Parent and Sub that neither the Investor nor any of its directors, officers,
employees, agents or representatives has violated, and none of them will
violate, any of such restrictions with respect to the Old Notes, New Notes or
any other securities of Parent and/or Sub.

         3.9 Legend.
             ------
It is understood that the certificate or certificates representing  the New
Notes shall bear a legend substantially in the following form:

         THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
         AS AMENDED (THE "SECURITIES ACT"), OR ANY STATE SECURITIES LAWS.
         NEITHER THIS SECURITY NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE
         REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR

                                       4

<PAGE>

         OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS
         SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, REGISTRATION. THE
         HOLDER OF THIS SECURITY BY ITS ACCEPTANCE HEREOF AGREES TO OFFER, SELL
         OR OTHERWISE TRANSFER THIS SECURITY PRIOR TO THE DATE WHICH IS TWO
         YEARS (OR SUCH OTHER PERIOD THAT MAY HEREAFTER BE PROVIDED UNDER RULE
         144(k) UNDER THE SECURITIES ACT AS PERMITTING RESALES OF RESTRICTED
         SECURITIES BY NON-AFFILIATES WITHOUT RESTRICTION) AFTER THE LATER OF
         THE ORIGINAL ISSUE DATE HEREOF AND THE LAST DATE ON WHICH AN ISSUER OR
         ANY AFFILIATE OF AN ISSUER WAS THE OWNER OF THIS SECURITY (OR ANY
         PREDECESSOR OF THIS SECURITY) (THE "RESALE RESTRICTION TERMINATION
         DATE") ONLY (A) TO AN ISSUER, (B) PURSUANT TO A REGISTRATION STATEMENT
         WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT, (C) FOR SO
         LONG AS THIS SECURITY IS ELIGIBLE FOR RESALE PURSUANT TO RULE 144A
         UNDER THE SECURITIES ACT, IN THE UNITED STATES TO A PERSON IT
         REASONABLY BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN
         RULE 144A UNDER THE SECURITIES ACT) THAT PURCHASES FOR ITS OWN ACCOUNT
         OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS
         GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A UNDER
         THE SECURITIES ACT, (D) OUTSIDE THE UNITED STATES IN AN OFFSHORE
         TRANSACTION IN ACCORDANCE WITH RULE 904 UNDER THE SECURITIES ACT, (E)
         TO AN INSTITUTIONAL "ACCREDITED INVESTOR" WITHIN THE MEANING OF
         SUBPARAGRAPH (a)(1), (2), (3) OR (7) OF RULE 501 UNDER THE SECURITIES
         ACT THAT IS ACQUIRING THIS SECURITY FOR ITS OWN ACCOUNT, OR FOR THE
         ACCOUNT OF SUCH AN INSTITUTIONAL "ACCREDITED INVESTOR," FOR INVESTMENT
         PURPOSES AND NOT WITH A VIEW TO, OR FOR OFFER OR SALE IN CONNECTION
         WITH, ANY DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT OR (F)
         PURSUANT TO ANOTHER AVAILABLE EXEMPTION FROM THE REGISTRATION
         REQUIREMENTS OF THE SECURITIES ACT, SUBJECT TO THE ISSUERS' AND THE
         TRUSTEE'S RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER TO REQUIRE
         THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATIONS AND/OR OTHER
         INFORMATION SATISFACTORY TO EACH OF THEM AND IN EACH OF THE FOREGOING
         CASES A CERTIFICATE OF TRANSFER IN THE FORM APPEARING IN THE INDENTURE
         IS COMPLETED AND DELIVERED BY THE TRANSFEROR TO THE TRUSTEE AND IN EACH
         CASE IN ACCORDANCE WITH APPLICABLE SECURITIES LAWS OF ANY U.S. STATE OR
         ANY OTHER APPLICABLE JURISDICTION. THE HOLDER OF THIS SECURITY AGREES
         THAT IT WILL DELIVER TO EACH PERSON TO WHOM THIS SECURITY IS
         TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND. THIS
         LEGEND WILL BE REMOVED UPON THE REQUEST OF THE HOLDER AFTER THE RESALE
         RESTRICTION TERMINATION DATE.

                                    ARTICLE 4

                               REGISTRATION RIGHTS
                               -------------------

         4.1.     Registered Exchange Offer.
                  -------------------------

         (a) Parent and Sub shall, at their sole cost and expense, prepare and,
not later than 60 days after the date hereof, file with the Securities and
Exchange Commission (the "Commission") a registration statement (the "Exchange
                          ----------                                  --------
Offer Registration Statement") on an appropriate form under the Securities Act,
----------------------------
with respect to a proposed offer (the "Registered Exchange Offer") to the
                                       -------------------------
holders of the Restricted Notes

                                       5

<PAGE>

(the "Holders") who are not prohibited by any participating in the Registered
      -------
Exchange Offer, to issue and deliver to such Holders, in exchange for the
Restricted Notes, a like aggregate principal amount of debt securities of
Parent and Sub issued under the Indenture, identical in all respects to the
Restricted Notes and registered under the Securities Act (the "Exchange
                                                               --------
Securities"). Parent and Sub shall use their commercially reasonable best
----------
efforts: (i) to cause such Exchange Offer Registration Statement to become
effective under the Securities Act as soon as reasonably practical after filing
and (ii) to keep the Exchange Offer Registration Statement effective for not
less than 20 business days (to the extent required by applicable law, or
longer, if required by applicable law) after the date notice of the Registered
Exchange Offer is mailed to the Holders (such period being called the
"Exchange Offer Registration Period") and thereafter until such time as Parent
 ----------------------------------
and Sub have jointly issued Exchange Securities in exchange for all Restricted
Notes that have been properly tendered for exchange during the Exchange Offer
Registration Period.

         (b) Subject to the effectiveness of the Exchange Offer Registration
Statement, Parent and Sub (i) will be entitled to consummate the Registered
Exchange Offer as soon as reasonably practical, subject to applicable law, after
such commencement (provided that Parent and Sub have accepted all the Restricted
Notes theretofore validly tendered in accordance with the terms of the
Registered Exchange Offer) and (ii) subject to the receipt of the certifications
referenced in Section 4.2(d) below, will be required to consummate the
Registered Exchange Offer as soon as reasonably practical, subject to applicable
law, on or after the 20th business day following commencement.

         (c) Following the declaration of the effectiveness of the Exchange
Offer Registration Statement, Parent and Sub shall promptly commence the
Registered Exchange Offer, it being the objective of such Registered Exchange
Offer to enable each Holder electing to exchange the Restricted Notes for
Exchange Securities (assuming that such Holder (i) is not a Broker-Dealer (as
defined in the Indenture), (ii) is not participating in a distribution of the
Exchange Securities and (iii) is not an affiliate (as defined in Rule 144) of
either Parent or Sub) to trade such Exchange Securities from and after their
receipt without any limitations or restrictions under the Securities Act and
without material restrictions under the securities laws of the several states of
the United States.

         4.2      Procedures.
                  ----------

         (a)      In connection with the Registered Exchange Offer, Parent and
                  Sub shall:

                  (i)  mail to each Holder a copy of the prospectus forming part
         of the Exchange Offer Registration Statement, together with an
         appropriate letter of transmittal and related documents;

                  (ii)  keep the Registered Exchange Offer open for not less
         than 20 business days (to the extent required by applicable law, or
         longer, if required by applicable law) after the date notice thereof
         is mailed to the Holders;

                  (iii) utilize the services of a depositary  for the
         Registered  Exchange Offer which may be the Trustee or an affiliate of
         the Trustee;

                  (iv)  permit Holders to withdraw tendered Restricted Notes at
         any time prior to the close of business, New York City time, on the
         last business day on which the Registered Exchange Offer shall remain
         open; and

                  (v)   otherwise comply with all applicable laws.

                                       6

<PAGE>

         (b)      As soon as practicable after the close of the Registered
                  Exchange Offer, Parent and Sub shall:

                  (i)   accept  for  exchange  all  the  Restricted  Notes
         validly  tendered  and  not withdrawn pursuant to the Registered
         Exchange Offer;

                  (ii)   deliver to the Trustee for  cancellation  all the
         Restricted  Notes so accepted for exchange; and

                  (iii) cause the Trustee to authenticate and deliver promptly
         to each Holder of the Restricted Notes a principal amount of Exchange
         Securities equal in principal amount to the Restricted Notes of such
         Holder so accepted for exchange.

         (c) Interest on each Exchange Security issued pursuant to the
Registered Exchange Offer will accrue from the last interest payment date on
which interest was paid on the Restricted Notes surrendered in exchange therefor
or, if no interest has been paid on the Restricted Notes, from September 30,
2002 (in accordance with the offset provisions set forth in Section 1.3 hereof).

         (d) In accordance with Section 2.5(f) of the Indenture, each Holder
participating in the Registered Exchange Offer shall be required to certify in
the applicable Letter of Transmittal that (i) it is not a Broker-Dealer (as
defined in the Indenture), (ii) it is not participating in a distribution of the
Exchange Securities and (iii) it is not an affiliate (as defined in Rule 144) of
either Parent or Sub. In addition, each Holder participating in the Registered
Exchange Offer shall be required to provide any other certifications, documents
and information, as applicable, required by the Indenture (including, without
limitation, Section 2.5 of the Indenture) in order for such Holder to
participate in the Registered Exchange Offer.

         (e) Notwithstanding any other provisions hereof, Parent and Sub will
ensure that (i) the Exchange Offer Registration Statement and any amendment
thereto and any prospectus forming part thereof and any supplement thereto
complies in all material respects with the Securities Act and the rules and
regulations thereunder, (ii) any Exchange Offer Registration Statement and any
amendment thereto does not, when it becomes effective, contain an untrue
statement of a material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein not misleading and
(iii) any prospectus forming part of any Exchange Offer Registration Statement,
and any supplement to such prospectus, does not include an untrue statement of a
material fact or omit to state a material fact required to be stated therein or
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading.

                                    ARTICLE 5

                                  MISCELLANEOUS
                                  -------------

         5.1      Entire Agreement; Successors and Assigns.
                  ----------------------------------------
This Agreement and the exhibit hereto constitute the entire agreement by and
among Parent, Sub and the Investor relative to the subject matter hereof and
supersede any previous agreement by and among Parent, Sub and the Investor with
respect to the same subject matter. The terms and conditions of this Agreement
shall inure to the benefit of and be binding upon the respective executors,
administrators, heirs, successors and assigns of the parties.

         5.2      Governing  Law.
                  --------------
This  Agreement  shall be governed by and  construed in accordance  with the
laws of the State of New York without regard to the conflicts of laws
principles thereof.

                                       7

<PAGE>

         5.3      Counterparts.
                  ------------
This  Agreement  may be  executed  in  counterparts,  each of  which  shall  be
an original, but all of which together shall constitute one and the same
instrument.

         5.4      Headings.
                  --------
The  section  headings  of  this  Agreement  are  for  convenience  and  shall
not by themselves determine the interpretation of this Agreement.

         5.5      Notices.
                  -------
Any notice required or permitted hereunder shall be given in writing and shall
be conclusively deemed effectively given upon personal delivery, or delivery by
overnight courier, or telecopy (with confirmation of receipt), or five (5) days
after deposit in the United States mail, by registered or certified mail,
postage prepaid, addressed:

              if to Parent and Sub: Denny's Corporation
                                    203 East Main Street
                                    Spartanburg, South Carolina 29319
                                    Attn: General Counsel
                                    Telecopy: (864) 597-8327

              with copy to:         Alston & Bird LLP
                                    Bank of America Plaza
                                    101 South Tryon Street, Suite 4000
                                    Charlotte, North Carolina 28280-4000
                                    Attn:  Gary C. Ivey
                                    Telecopy: (704) 444-1111

              if to the Investor:


                                    Attn:
                                         -----------------------------
                                    Telecopy:
                                             -------------------------

              with a copy to:

                                      Attn:
                                         -----------------------------
                                      Telecopy:
                                             -------------------------

         5.6      Survival of Warranties.
                  ----------------------
The  representations  and warranties of the parties contained in or made
pursuant to this Agreement shall survive the date hereof.

         5.7      Amendment of Agreement.
                  ----------------------
Any provision of this  Agreement may be amended by a written  instrument
signed by Parent, Sub and the Investor.

         5.8      Expenses.
                  --------
Each party hereto will pay their respective fees and expenses incurred by them
in connection with the transactions contemplated in this Agreement.


                            [Signatures on Next Page]


                                       8

<PAGE>








         IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date above set forth.

                            DENNY'S CORPORATION


                            By:
                               ------------------------------------------------
                            Name:
                               ------------------------------------------------
                            Title:
                               ------------------------------------------------



                            DENNY'S HOLDINGS, INC.


                            By:
                               ------------------------------------------------
                            Name:
                               ------------------------------------------------
                            Title:
                               ------------------------------------------------



                       [Signatures continued on next page]



<PAGE>


Investor Signature Page to Note Exchange
And Registration Rights Agreement


                            [INVESTOR]


                            By:
                               ------------------------------------------------
                            Name:
                               ------------------------------------------------
                            Title:
                               ------------------------------------------------






<PAGE>






                                    EXHIBIT A
                                    ---------

                                FORM OF NEW NOTES


                                FACE OF SECURITY



No.    R1                                                 $
                                                           --------------------
                              DENNY'S CORPORATION
                                       AND
                             DENNY'S HOLDINGS, INC.

                          12 3/4% Senior Notes Due 2007


         Denny's Corporation, a Delaware corporation (formerly known as
Advantica Restaurant Group, Inc.) ("Denny's"), and Denny's Holdings, Inc., a New
                                    -------
York corporation ("Denny's Holdings," and together with Denny's, the "Issuers"),
                   ----------------                                   -------
for value received hereby promise to pay to _________________________ or
registered assigns the principal sum of ______________ Dollars at the Issuers'
office or agency for said purpose on September 30, 2007 in such coin or currency
of the United States of America as at the time of payment shall be legal tender
for the payment of public and private debts, and to pay interest, semi-annually,
on March 31 and September 30 of each year, commencing on September 30, 2002, on
said principal sum in like coin or currency at the rate per annum set forth
above at said office or agency from the March 31 or the September 30, as the
case may be, next preceding the date of this Security to which interest on the
Securities has been paid or duly provided for, unless the date hereof is a date
to which interest on the Securities has been paid or duly provided for, in which
case from the date of this Security, or unless no interest has been paid or duly
provided for on the Securities, in which case from April 15, 2002, until payment
of said principal sum has been made or duly provided for. Notwithstanding the
foregoing, if the date hereof is after March 15 or September 15, as the case may
be, and before the following March 31 or September 30, this Security shall bear
interest from such March 31 or September 30; provided that, if the Issuers shall
default in the payment of interest due on such March 31 or September 30, then
this Security shall bear interest from the next preceding March 31 or September
30 to which interest on the Securities has been paid or duly provided for, or,
if no interest has been paid or duly provided for on the Securities, from April
15, 2002. The interest so payable on any March 31 or September 30 will, except
as otherwise provided in the Indenture referred to on the reverse hereof, be
paid to the person in whose name this Security is registered at the close of
business on the March 15 or September 15 next preceding such March 31 or
September 30, whether or not such day is a business day; provided that interest
may be paid, at the option of the Issuers, by mailing a check therefor payable
to the registered holder entitled thereto at his last address as it appears on
the Security register or by wire transfer to such holder.

         Reference is made to the further provisions set forth on the reverse
hereof. Such further provisions shall for all purposes have the same effect as
though fully set forth at this place.

         This Security shall not be valid or obligatory until the certificate of
authentication hereof, shall have been duly signed by the Trustee acting under
the Indenture.

                                       A-1

<PAGE>


         IN WITNESS WHEREOF, each of the Issuers has caused this instrument to
be duly executed under its corporate seal.


DATED:  November    , 2002
                 ---

 [SEAL]                     DENNY'S CORPORATION,
                            a Delaware corporation


                            By:
                               -----------------------------
                            Name:
                            Title:


                            By:
                               -----------------------------
                            Name:
                            Title:


                       [Signatures continued on next page]


                                       A-2
<PAGE>




[SEAL]                      DENNY'S HOLDINGS, INC.,
                            a New York corporation


                            By:
                              -----------------------------
                            Name:
                            Title:


                            By:
                              ------------------------------
                            Name:
                            Title:

                                       A-3

<PAGE>


                     TRUSTEE'S CERTIFICATE OF AUTHENTICATION

                    This is one of the Securities described in the
within-mentioned Indenture.



                             U.S. Bank National Association, as Trustee


                             --------------------------------
                             Authorized Signatory

                                        A-4

<PAGE>


                               REVERSE OF SECURITY

                               DENNY'S CORPORATION
                                       AND
                             DENNY'S HOLDINGS, INC.

                          12 3/4% Senior Notes Due 2007

         THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED (THE "SECURITIES ACT"), OR ANY STATE SECURITIES LAWS. NEITHER THIS
SECURITY NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD,
ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE
ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT
SUBJECT TO, REGISTRATION. THE HOLDER OF THIS SECURITY BY ITS ACCEPTANCE HEREOF
AGREES TO OFFER, SELL OR OTHERWISE TRANSFER THIS SECURITY PRIOR TO THE DATE
WHICH IS TWO YEARS (OR SUCH OTHER PERIOD THAT MAY HEREAFTER BE PROVIDED UNDER
RULE 144(k) UNDER THE SECURITIES ACT AS PERMITTING RESALES OF RESTRICTED
SECURITIES BY NON-AFFILIATES WITHOUT RESTRICTION) AFTER THE LATER OF THE
ORIGINAL ISSUE DATE HEREOF AND THE LAST DATE ON WHICH AN ISSUER OR ANY AFFILIATE
OF AN ISSUER WAS THE OWNER OF THIS SECURITY (OR ANY PREDECESSOR OF THIS
SECURITY) (THE "RESALE RESTRICTION TERMINATION DATE") ONLY (A) TO AN ISSUER, (B)
PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE
SECURITIES ACT, (C) FOR SO LONG AS THIS SECURITY IS ELIGIBLE FOR RESALE PURSUANT
TO RULE 144A UNDER THE SECURITIES ACT, IN THE UNITED STATES TO A PERSON IT
REASONABLY BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE
144A UNDER THE SECURITIES ACT) THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE
ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE
TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A UNDER THE SECURITIES ACT, (D)
OUTSIDE THE UNITED STATES IN AN OFFSHORE TRANSACTION IN ACCORDANCE WITH RULE 904
UNDER THE SECURITIES ACT, (E) TO AN INSTITUTIONAL "ACCREDITED INVESTOR" WITHIN
THE MEANING OF SUBPARAGRAPH (a)(1), (2), (3) OR (7) OF RULE 501 UNDER THE
SECURITIES ACT THAT IS ACQUIRING THIS SECURITY FOR ITS OWN ACCOUNT, OR FOR THE
ACCOUNT OF SUCH AN INSTITUTIONAL "ACCREDITED INVESTOR," FOR INVESTMENT PURPOSES
AND NOT WITH A VIEW TO, OR FOR OFFER OR SALE IN CONNECTION WITH, ANY
DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT OR (F) PURSUANT TO ANOTHER
AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT,
SUBJECT TO THE ISSUERS' AND THE TRUSTEE'S RIGHT PRIOR TO ANY SUCH OFFER, SALE OR
TRANSFER TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATIONS AND/OR
OTHER INFORMATION SATISFACTORY TO EACH OF THEM AND IN EACH OF THE FOREGOING
CASES A CERTIFICATE OF TRANSFER IN THE

                                       A-5
<PAGE>

FORM APPEARING IN THE INDENTURE IS COMPLETED AND DELIVERED BY THE TRANSFEROR TO
THE TRUSTEE AND IN EACH CASE IN ACCORDANCE WITH APPLICABLE SECURITIES LAWS OF
ANY U.S. STATE OR ANY OTHER APPLICABLE JURISDICTION. THE HOLDER OF THIS
SECURITY AGREES THAT IT WILL DELIVER TO EACH PERSON TO WHOM THIS SECURITY IS
TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND. THIS LEGEND
WILL BE REMOVED UPON THE REQUEST OF THE HOLDER AFTER THE RESALE RESTRICTION
TERMINATION DATE.

         This Security is one of a duly authorized issue of debt securities of
each Issuer, limited to the aggregate principal amount of $120,389,000.00
(except as otherwise provided in the Indenture mentioned below), issued or to be
issued pursuant to an indenture dated as of April 15, 2002 (the "Indenture"),
                                                                 ---------
duly executed and delivered by the Issuers to U.S. Bank National Association, as
Trustee (herein called the "Trustee"); provided, that Securities issued on the
                            -------
Original Issue Date shall not exceed $70,389,000.00 in aggregate principal
amount and Securities issued thereafter (other than pursuant to an Exchange
Offer or otherwise in replacement of outstanding Securities) shall not exceed
$50,000,000 in aggregate principal amount. Reference is hereby made to the
Indenture and all indentures supplemental thereto for a description of the
rights, limitations of rights, obligations, duties and immunities thereunder of
the Trustee, the Issuers and the holders (the words "holders" or "holder"
                                                     -------      ------
meaning the registered holders or registered holder) of the Securities. Defined
terms used without definition herein shall have the meanings ascribed to them in
the Indenture.

         If an Event of Default, other than in respect of certain events of
bankruptcy or insolvency as set forth in the Indenture, shall have occurred and
be continuing, the Trustee or the holders of at least 30% (or 25% in the case of
an Event of Default with respect to payment of principal of, premium, if any, or
interest on, the Securities) in aggregate principal amount of the Securities
then outstanding may declare in writing 100% of the unpaid principal amount of,
and any accrued and unpaid interest on, the Securities to be due and payable
immediately; provided, however, that if any Senior Indebtedness is outstanding
pursuant to the Credit Agreement, then all the Securities shall be due and
payable upon the earlier of (x) the day that is five Business Days after the
provision to the Issuers and the Credit Agent of such written notice of
acceleration unless such Event of Default has been cured or waived prior to such
date and (y) the date of acceleration of any Senior Indebtedness under the
Credit Agreement. Upon an Event of Default arising from certain events of
bankruptcy or insolvency as described in the Indenture, the unpaid principal of
and any accrued and unpaid interest on all the Securities will become
immediately due and payable without further action or notice. The Indenture
provides that in certain events a declaration of acceleration and its
consequences resulting from a default under certain other Indebtedness of an
Issuer or its Subsidiaries may be automatically annulled and that the holders of
a majority in aggregate principal amount of the Securities then outstanding may,
on behalf of the holders of all of the Securities, waive any past Default or
Event of Default under the Indenture and its consequences, except a continuing
Default or Event of Default in the payment of principal of, premium, if any, or
interest on any of the Securities. Any such consent or waiver by the holder of
this Security (unless revoked as provided in the Indenture) shall be conclusive
and binding upon such holder and upon all future holders and owners of this
Security and any Security which may be issued in exchange or substitution
herefor, whether or not any notation thereof is made upon this Security or such
other Securities.

         The Indenture permits the Issuers and the Trustee, with the consent of
the holders of not less than a majority in aggregate principal amount of the
Securities at the time outstanding, evidenced as in the Indenture provided, to
enter into supplemental indentures adding any provisions to or changing in any
manner or eliminating any of the provisions of the Indenture or of any
supplemental indenture or modifying in any manner the rights of the holders of
the Securities; provided that no such supplemental

                                       A-6

<PAGE>

indenture shall (a) extend the final maturity of any Security, or reduce the
principal amount thereof, or reduce the rate or extend the time of payment of
interest thereon, or reduce the premium, if any, payable thereon, or reduce any
amount payable on the redemption thereof, or impair or affect the right of any
holder to institute suit for the payment thereof, or waive a default in the
payment of principal of, premium, if any, or interest on any Security, change
the currency of payment of principal of, premium, if any, or interest on any
Security, or modify any provision in the Indenture with respect to the priority
of the Securities in right of payment without the consent of the holder of each
Security so affected, or (b) reduce the aforesaid percentage of Securities, the
consent of the holders of which is required for any such supplemental
indenture, wiithout the consent of the holders of each Security then
outstanding.

         The Securities are senior unsecured obligations of the Issuers and will
rank pari passu in right of payment to all Senior Indebtedness of the Issuers.

         No reference herein to the Indenture and no provision of this Security
or of the Indenture shall alter or impair the obligation of the Issuers, which
is absolute and unconditional, to pay the principal of, premium, if any, and
interest on this Security at the place, times, and rate, and in the currency,
herein prescribed.

         The Securities are issuable only as registered Securities without
coupons in denominations of $1,000 and any multiple of $1,000.

         At the office or agency of the Issuers referred to on the face hereof
and in the manner and subject to the limitations provided in the Indenture,
Securities may be exchanged for a like aggregate principal amount of Securities
of other authorized denominations.

         Upon due presentment for registration of transfer of this Security at
the above-mentioned office or agency of the Issuers, a new Security or
Securities of authorized denominations, for a like aggregate principal amount,
will be issued to the transferee as provided in the Indenture. Securities may be
presented for registration of transfer in part only in multiples of $1,000. No
service charge shall be made for any such transfer, but the Issuers may require
payment of a sum sufficient to cover any tax or other governmental charge that
may be imposed in relation thereto.

         Except as provided below, the Securities may not be redeemed, either in
whole or in part, at the option of the Issuers prior to September 30, 2004. On
and after September 30, 2004, the Securities will be redeemable, in whole or in
part, at the option of the Issuers, at the redemption prices (expressed as
percentages of the principal amount) set forth below, plus accrued and unpaid
interest, if any, to the redemption date, if redeemed during the 12-month period
beginning September 30 of the years indicated below:

               YEAR                                                  PERCENTAGE
               2004                       ..........................  106.3750%
               2005                       ................. ........  103.1875%
               2006 and thereafter        ..........................  100.0000%

provided that, if the dated fixed for redemption is on March 31, or September
30, then the interest payable on such date shall be paid to the holder of
record on the March 15 or September 15 next preceding such March 31 or
September 30.

         Notwithstanding the foregoing, prior to September 30, 2004, the
Issuers may redeem up to 35% of the aggregate principal amount of Securities
outstanding on the date of the Indenture at a redemption

                                       A-7

<PAGE>

price (expressed as a percentage of the principal amount) of 112.75%, plus
accrued and unpaid interest, if any, to the redemption date, from the net
proceeds of any Public Offering.

         Notice of redemption shall be mailed at least 30 and not more than 60
days prior to the date fixed for redemption to each holder of Securities to be
redeemed at its last registered address. Securities may be redeemed in part
only in multiples of $1,000.

         Subject to the terms of the Indenture, if an Issuer consummates an
Asset Sale or sells, leases, conveys or otherwise disposes of a Business
Segment, such Issuer shall be obligated to apply the Net Proceeds thereof to
one or more of the following in such combination as such Issuer may choose:
(i) an Investment in another asset or business in the same line of business as,
or a line of business similar to that of, the line of business of Denny's and
its Subsidiaries (other than in the case of any Asset Sale of an Asset Segment
in any of the Denny's Holdings Group or any sale, lease, conveyance or other
disposition of any Business Segment in any of the Denny's Holdings Group, any
Investment by any of the Denny's Holdings Group in any of the Denny's Group)
and such Investment occurs within 366 days of such Asset Sale or such sale,
lease, conveyance or other disposition of a Business Segment, (ii) an offer,
expiring within 366 days of such Asset Sale or such sale, lease, conveyance or
other disposition of a Business Segment, to repurchase Securities at a price
not less than 100% of the principal amount thereof, plus accrued and unpaid
interest, if any, to the redemption date (a "Net Proceeds Offer") or (iii) the
                                             ------------------
purchase, redemption or other prepayment or repayment of outstanding Senior
Indebtedness within 366 days of such Asset Sale or such sale, lease, conveyance
or other disposition of a Business Segment, provided, that any amounts used to
repay Indebtedness outstanding under the Old Notes shall be applied only as and
when permitted by the Indenture; provided, however, that if the net amount not
invested pursuant to clause (i) above or applied pursuant to clause (iii) above
is less than $15,000,000, such Issuer shall not be further obligated to offer
to repurchase Securities pursuant to clause (ii) above. Holders of Securities
that are the subject of an offer to repurchase shall receive an offer to
repurchase from the Issuers prior to any related repurchase date, and may elect
to have such Securities repurchased by completing the form entitled "Option of
Holder to Elect to Have Security Repurchased" appearing below. Notwithstanding
any provision of the Indenture to the contrary, the Issuer that originally
received the Net Proceeds may, for a period of 120 days after the last date on
which holders of Securities are permitted to tender their Securities in a Net
Proceeds Offer, use any Net Proceeds that were available to make such Net
Proceeds Offer but not used to repurchase Securities pursuant thereto, to
purchase, redeem or otherwise acquire or retire for value securities of such
Issuer ranking junior in right of payment to the Securities at a price, stated
as a percentage of the principal or face amount of such junior securities, not
greater than the price, stated as a percentage of the principal amount of the
Securities, offered in the Net Proceeds Offer; provided that, if the Net
Proceeds Offer is for a principal amount (the "Net Proceeds Offer Amount") of
                                               -------------------------
the Securities less than the aggregate principal amount of the Securities then
outstanding, then the Net Proceeds available for use by such Issuer for such a
purchase, redemption or other acquisition or retirement for value of junior
securities shall not exceed the Net Proceeds Offer Amount.

         Subject to payment by the Issuers (by deposit with the Trustee or
otherwise) of a sum sufficient to pay the amount due on redemption, interest on
this Security (or portion hereof if this Security is redeemed or repurchased in
part) shall cease to accrue upon the date duly fixed for redemption or
repurchase of this Security (or portion hereof if this Security is redeemed or
repurchased in part), and all rights of the holder with respect to such
redeemed Security (or portion thereof if this Security is redeemed or
repurchased in part) hereunder or under the Indenture, except the right to
payment of amounts payable on such redemption or repurchase, shall cease.

         The Issuers, the Trustee, and any authorized agent of the Issuers or
the Trustee, may deem and treat the registered holder hereof as the absolute
owner of this Security (whether or not this Security shall be overdue and
notwithstanding any notation of ownership or other writing hereon made by
anyone other

                                       A-8
<PAGE>

than the Issuers or the Trustee or any authorized agent of the Issuers or the
Trustee), for the purpose of receiving payment of, or on account  of, the
principal hereof and premium, if any, and, subject to the provisions on  the
face hereof, interest hereon and for all other purposes, and neither the
Issuers nor the Trustee nor any authorized agent of the Issuers or the Trustee
shall be affected by any notice to the contrary.

         No recourse shall be had for the payment of the principal of, premium,
if any, or interest on this Security, for any claim based hereon, or otherwise
in respect hereof, or based on or in respect of the Indenture or any indenture
supplemental thereto, against any incorporator, stockholder, officer or
director, as such, past, present or future, of either Issuer or of any successor
corporation, either directly or through such Issuer or any successor
corporation, whether by virtue of any constitution, statute or rule of law or by
the enforcement of any assessment or penalty or otherwise, all such liability
being, by the acceptance hereof and as part of the consideration for the issue
hereof, expressly waived and released. Nothing in this provision limits the
liability, if any, of any such incorporator, officer, director or shareholder,
as such, under the federal securities laws.

         In addition to the rights provided to Holders of Securities under the
Indenture, Holders of Transfer Restricted Securities shall have all the rights
set forth in the applicable Registration Rights Agreement.



                                       A-9
<PAGE>




             OPTION OF HOLDER TO ELECT TO HAVE SECURITY REPURCHASED

If you have received a Net Proceeds Offer from the Issuers and want to elect to
have this Security repurchased by the Issuers pursuant to Section 11.5 of the
Indenture, check the box: [ ]

If you have received a Change of Control Offer from the Issuers and want to
elect to have this Security repurchased by the Issuers pursuant to Section 3.18
of the Indenture, check the box: [ ]

If you want to elect to have any part of this Security repurchased by the
Issuers pursuant to Section 3.18 of the Indenture, state the amount:
$________________________


Date:  _______________________          Your Signature:
                                                       ------------------------
                                        (Sign exactly as your name appears
                                        on the other side of this Security)

Signature Guarantee:

                                       A-10

<PAGE>




</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-12
<SEQUENCE>6
<FILENAME>ratios.txt
<DESCRIPTION>RATIOS
<TEXT>
                                                                   EXHIBIT 12.1
                                                                   ------------

                        ADVANTICA RESTAURANT GROUP, INC.
                COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES

<TABLE>
<CAPTION>
                                                                                    One Week           Fifty-One
                                                                   --------           Ended           Weeks Ended         ---------
                                                                     1997        January 7, 1998   December 30, 1998         1999
                                                                   --------      ---------------   -----------------      ---------
<S>                                                                <C>           <C>               <C>                    <C>
(In thousands)
Income (loss) from continuing operations before income taxes       $(81,978)         $589,044          $(129,060)         $(274,988)
                                                                   --------          --------          ---------          ---------
Add:
       Interest expense excluding capitalized interest              124,507             1,901            101,590             93,498
       Amortization of debt expense                                   4,608                83             (7,501)            (7,682)
                                                                   --------          --------          ---------          ---------
                       Subtotal                                     129,115             1,984             94,089             85,816
                                                                   --------          --------          ---------          ---------
       Interest factor in rents                                      11,190               218             11,174             12,349
                                                                   --------          --------          ---------          ---------
                       Total earnings (losses)                     $ 58,327          $591,246          $ (23,797)         $(176,823)
                                                                   ========          ========          =========          =========

Fixed charges:
       Interest expense excluding capitalized interest             $124,507          $  1,901          $ 101,590          $  93,498
       Amortization of debt expense                                   4,608                83             (7,501)            (7,682)
                                                                   --------          --------          ---------          ---------
                       Subtotal                                     129,115             1,984             94,089             85,816
       Interest factor in rents                                      11,190               218             11,174             12,349
                                                                   --------          --------          ---------          ---------
                       Total fixed charges                         $140,305          $  2,202          $ 105,263          $  98,165
                                                                   ========          ========          =========          =========

Ratio of earnings to fixed charges                                       --             268.5                 --                 --
                                                                   ========          ========          =========          =========

Deficiency in the coverage of fixed charges by
       earnings (losses) before fixed charges                        81,978          (589,044)           129,060            274,988
                                                                   ========          ========          =========          =========

<CAPTION>
                                                                                                         Three              Three
                                                                                                       Quarters          Quarters
                                                                                                         Ended              Ended
                                                                    -------           -------        September 26,    September 26,
                                                                     2000              2001               2001               2002
                                                                    --------          -------          ---------          ---------
<S>                                                                 <C>               <C>            <C>               <C>
(In thousands)
Income (loss) from continuing operations before income taxes       $(80,670)         $(94,751)        $ (47,727)         $   9,266
                                                                    --------          --------         ---------          ---------
Add:
       Interest expense excluding capitalized interest               90,311            78,252            54,732             60,171
       Amortization of debt expense                                  (3,366)            1,511             1,080               1,835
                                                                    --------          --------         ---------          ---------
                       Subtotal                                       86,945            79,763            55,812             62,006
                                                                    --------          --------         ---------          ---------
       Interest factor in rents                                       15,774            15,513            12,019             11,635
                                                                    --------          --------         ---------          ---------
                       Total earnings (losses)                      $ 22,049          $    525         $  20,104          $  82,907
                                                                    ========          ========         =========          =========

Fixed charges:
       Interest expense excluding capitalized interest              $ 90,311          $ 78,252         $  54,732          $  60,171
       Amortization of debt expense                                   (3,366)            1,511             1,080              1,835
                                                                    --------          --------         ---------          ---------
                       Subtotal                                       86,945            79,763            55,812             62,006
       Interest factor in rents                                       15,774            15,513            12,019             11,635
                                                                    --------          --------         ---------          ---------
                       Total fixed charges                          $102,719          $ 95,276         $  67,831          $  73,641
                                                                    ========          ========         =========          =========

Ratio of earnings to fixed charges                                        --                --                --                1.1
                                                                    ========          ========         =========          =========

Deficiency in the coverage of fixed charges by
       earnings (losses) before fixed charges                         80,670            94,751            47,727             (9,266)
                                                                    ========          ========         =========          =========
</TABLE>

For purposes of these computations, the ratio of earnings to fixed charges has
been calculated by dividing pretax earnings by fixed charges. Earnings, as used
to compute the ratio, equals the sum of income before income taxes and fixed
charges excluding capitalized interest. Fixed charges are the total interest
expenses including capitalized interest, amortization of debt expenses and a
rental factor that is representative of an interest factor (estimated to be one
third) on operating leases.


</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-13
<SEQUENCE>7
<FILENAME>thirdquarter200210q.txt
<DESCRIPTION>THIRD QUARTER 10-Q
<TEXT>




                                     UNITED STATES
                            SECURITIES AND EXCHANGE COMMISSION
                               Washington, D.C.  20549

                                       FORM 10-Q

(Mark one)

[X]      Quarterly report pursuant to section 13 or 15(d) of the Securities
         Exchange Act of 1934 for the quarterly period ended
         September 25, 2002 or

[ ]      Transition report pursuant to section 13 or 15(d) of the Securities
         Exchange Act of 1934 for the transition period from
         ___________  to __________

Commission file number                0-18051


                                   DENNY'S CORPORATION
--------------------------------------------------------------------------------
                   (Exact name of registrant as specified in its charter)

                    Delaware                                    13-3487402
        -------------------------------                     ------------------
        (State or other jurisdiction of                     (I.R.S. Employer
         incorporation or organization)                     Identification No.)

                                  203 East Main Street
                          Spartanburg, South Carolina 29319-9966
--------------------------------------------------------------------------------
                         (Address of principal executive offices)
                                      (Zip Code)

                                   (864) 597-8000
--------------------------------------------------------------------------------
                  (Registrant's telephone number, including area code)


--------------------------------------------------------------------------------
             (Former name, former address and former fiscal year, if changed
                                 since last report)

Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.

                   Yes   [X]                            No   [ ]

Indicate by check mark whether the registrant has filed all documents and
reports required to be filed by Sections 12, 13 or 15(d) of the Securities
Exchange Act of 1934 subsequent to the distribution of securities under a plan
confirmed by a court.

                   Yes   [X]                            No   [ ]

As of November 1, 2002, 40,290,160 shares of the registrant's Common Stock, par
value $0.01 per share, were outstanding.

<PAGE>

PART I - FINANCIAL INFORMATION

Item 1.  Financial Statements

Denny's Corporation (formerly Advantica Restaurant Group, Inc.)
Condensed Consolidated Statements of Operations
(Unaudited)

<TABLE>
<CAPTION>
                                                                                       Quarter                   Quarter
                                                                                        Ended                     Ended
                                                                                  September 25, 2002       September 26, 2001
                                                                                  ------------------       ------------------

<S>                                                                                 <C>                      <C>


(In thousands, except per share amounts)
Revenue:
  Company restaurant sales                                                          $ 223,499                $ 245,870
  Franchise and license revenue                                                        23,355                   24,202
                                                                                     --------                 --------
    Total operating revenue                                                           246,854                  270,072
                                                                                     --------                 --------
Costs of company restaurant sales:
  Product costs                                                                        52,573                   60,504
  Payroll and benefits                                                                 92,937                   96,266
  Occupancy                                                                            12,398                   13,246
  Other operating expenses                                                             33,083                   36,248
                                                                                     --------                 --------
    Total costs of company restaurant sales                                           190,991                  206,264
Costs of franchise and license revenue                                                  7,349                    7,396
General and administrative expenses                                                    10,804                   15,327
Amortization of goodwill and other intangible assets with
  indefinite lives                                                                        ---                    7,770
Depreciation and other amortization                                                    20,734                   21,448
Impairment charges                                                                        465                      ---
Gains on refranchising and other, net                                                  (2,372)                  (1,827)
                                                                                     --------                 --------
    Total operating costs and expenses                                                227,971                  256,378
                                                                                     --------                 --------
Operating income                                                                       18,883                   13,694
                                                                                     --------                 --------
Other expenses:
  Interest expense, net                                                                18,980                   18,261
  Other nonoperating expense, net                                                          28                        1
                                                                                     --------                 --------
    Total other expenses, net                                                          19,008                   18,262
                                                                                     --------                 --------
Loss before income taxes                                                                 (125)                  (4,568)
Provision for income taxes                                                                303                      212
                                                                                     --------                 --------
Loss from continuing operations                                                          (428)                  (4,780)
Gain on disposal of discontinued operations                                            56,562                      ---
                                                                                     --------                 --------
Net income (loss) applicable to common shareholders                                 $  56,134                $  (4,780)
                                                                                     ========                 ========
Per share amounts applicable to common shareholders:
Basic and diluted earnings per share:
  Loss from continuing operations                                                   $   (0.01)               $   (0.12)
  Gain on disposal of discontinued operations                                            1.40                      ---
                                                                                     --------                 --------
  Net income (loss)                                                                 $    1.39                $  ( 0.12)
                                                                                     ========                 ========

Weighted average shares outstanding:
  Basic                                                                                40,280                   40,143
                                                                                     ========                 ========
  Diluted                                                                              40,280                   40,143
                                                                                     ========                 ========

</TABLE>
                                                        See accompanying notes

<PAGE>

Denny's Corporation (formerly Advantica Restaurant Group, Inc.)
Condensed Consolidated Statements of Operations
(Unaudited)

<TABLE>
<CAPTION>
                                                                                Three Quarters            Three Quarters
                                                                                    Ended                     Ended
                                                                              September 25, 2002        September 26, 2001
                                                                              ------------------        ------------------
<S>                                                                                 <C>                      <C>


(In thousands, except per share amounts)
Revenue:
  Company restaurant sales                                                          $ 653,185                $ 724,779
  Franchise and license revenue                                                        68,470                   68,036
                                                                                     --------                 --------
    Total operating revenue                                                           721,655                  792,815
                                                                                     --------                 --------
Cost of company restaurant sales:
  Product costs                                                                       155,798                  180,611
  Payroll and benefits                                                                269,341                  291,360
  Occupancy                                                                            36,967                   43,294
  Other operating expenses                                                             90,973                  107,548
                                                                                     --------                 --------
    Total costs of company restaurant sales                                           553,079                  622,813
Costs of franchise and license revenue                                                 21,970                   24,455
General and administrative expenses                                                    39,015                   49,617
Amortization of goodwill and other intangible assets with
  indefinite lives                                                                        ---                   23,943
Depreciation and other amortization                                                    62,292                   68,033
Restructuring charges and exit costs                                                    3,079                    8,495
Impairment charges                                                                        962                    8,343
Gains on refranchising and other, net                                                  (5,952)                 (12,123)
                                                                                     --------                 --------
    Total operating costs and expenses                                                674,445                  793,576
                                                                                     --------                 --------
Operating income (loss)                                                                47,210                     (761)
                                                                                     --------                 --------
Other expenses:
  Interest expense, net                                                                57,187                   54,732
  Other nonoperating income, net                                                      (19,243)                  (7,766)
                                                                                     --------                 --------
    Total other expenses, net                                                          37,944                   46,966
                                                                                     --------                 --------
Income (loss) before income taxes                                                       9,266                  (47,727)
(Benefit from) provision for income taxes                                              (1,834)                   1,280
                                                                                     --------                 --------
Income (loss) from continuing operations                                               11,100                  (49,007)
Gain on disposal of discontinued operations                                            56,562                      ---
                                                                                     --------                 --------
Net income (loss) applicable to common shareholders                                 $  67,662                $ (49,007)
                                                                                     ========                 ========

Per share amounts applicable to common shareholders:
Basic earnings per share:
  Income (loss) from continuing operations                                          $    0.28                $   (1.22)
  Gain on disposal of discontinued operations                                            1.40                      ---
                                                                                     --------                 --------
  Net income (loss)                                                                 $    1.68                $   (1.22)
                                                                                     ========                 ========

Diluted earnings per share:
  Income (loss) from continuing operations                                          $    0.27                $   (1.22)
  Gain on disposal of discontinued operations                                            1.40                      ---
                                                                                     --------                 --------
  Net income (loss)                                                                 $    1.67                $   (1.22)
                                                                                     ========                 ========

Weighted average shares outstanding:
  Basic                                                                                40,264                   40,134
                                                                                     ========                 ========
  Diluted                                                                              40,484                   40,134
                                                                                     ========                 ========


</TABLE>
                                                        See accompanying notes

<PAGE>

Denny's Corporation (formerly Advantica Restaurant Group, Inc.)
Condensed Consolidated Balance Sheets
(Unaudited)

<TABLE>
<CAPTION>
                                                                                September 25, 2002        December 26, 2001
                                                                                ------------------        -----------------
<S>                                                                                 <C>                      <C>


(In thousands)

Assets
Current Assets:
  Cash and cash equivalents                                                         $   4,035                $   6,696
  Receivables, less allowance for doubtful accounts of:
    2002 -- $2,570; 2001 -- $2,730                                                      6,745                    6,508
  Inventories                                                                           7,461                    7,979
  Other                                                                                10,294                   18,954
                                                                                     --------                 --------
Total Current Assets                                                                   28,535                   40,137
                                                                                     --------                 --------

Property, net                                                                         328,022                  362,441
Other Assets:
  Goodwill                                                                             51,415                   53,353
  Intangible assets                                                                    94,290                  100,912
  Deferred financing costs, net                                                         7,351                   10,067
  Other                                                                                40,164                   40,343
                                                                                     --------                 --------
Total Assets                                                                        $ 549,777                $ 607,253
                                                                                     ========                 ========
Liabilities
Current Liabilities:
  Current maturities of notes and debentures                                        $  40,539                $     599
  Current maturities of capital lease obligations                                       3,857                    4,523
  Accounts payable                                                                     34,181                   55,862
  Net liabilities of discontinued operations                                              ---                   15,115
  Other                                                                                96,110                  126,618
                                                                                     --------                 --------
                                                                                      174,687                  202,717
                                                                                     --------                 --------
Long-Term Liabilities:
  Notes and debentures, less current maturities                                       528,596                  609,531
  Capital lease obligations, less current maturities                                   33,115                   35,527
  Liability for insurance claims                                                       26,042                   26,778
  Other noncurrent liabilities and deferred credits                                    59,140                   72,457
                                                                                     --------                 --------
Total Long-Term Liabilities                                                           646,893                  744,293
                                                                                     --------                 --------

Total Liabilities                                                                     821,580                  947,010
Total Shareholders' Deficit                                                          (271,803)                (339,757)
                                                                                     --------                 --------
Total Liabilities and Shareholders' Deficit                                         $ 549,777                $ 607,253
                                                                                     ========                 ========

</TABLE>

                                                        See accompanying notes

<PAGE>

Denny's Corporation (formerly Advantica Restaurant Group, Inc.)
Condensed Consolidated Statements of Shareholder' Deficit
(Unaudited)

<TABLE>
<CAPTION>

                                                                                                      Accumulated
                                                      Common Stock        Additional                      Other           Total
                                                   -----------------       Paid-in                    Comprehensive   Shareholders'
                                                   Shares     Amount       Capital       Deficit      Income (Loss)      Deficit
                                                   ------     ------     ----------      -------     --------------  -------------
   <S>                                             <C>       <C>       <C>            <C>              <C>            <C>




(In thousands)

Balance, December 26, 2001                         40,143    $ 401     $ 417,293      $ (749,869)      $ (7,582)       $ (339,757)
                                                   ------     ----       -------       ---------        -------         ---------
  Comprehensive income:
    Net income                                        ---      ---           ---          67,662            ---            67,662
    Other comprehensive income:
      Foreign currency translation adjustments        ---      ---           ---             ---            176               176
                                                   ------     ----       -------       ---------         ------          --------
     Comprehensive income                             ---      ---           ---          67,662            176            67,838
    Issuance of common stock                          106        2            88             ---            ---                90
    Exercise of stock options                          31      ---            26             ---            ---                26
                                                   ------     ----       -------       ---------         ------          --------
Balance, September 25, 2002                        40,280    $ 403     $ 417,407      $ (682,207)      $ (7,406)       $ (271,803)
                                                   ======     ====      ========       =========        =======         =========

</TABLE>
                                                        See accompanying notes

<PAGE>

Denny's Corporation (formerly Advantica Restaurant Group, Inc.)
Condensed Consolidated Statements of Cash Flows
(Unaudited)

<TABLE>
<CAPTION>
                                                                                    Three Quarters          Three Quarters
                                                                                        Ended                    Ended
                                                                                  September 25, 2002      September 26, 2001
                                                                                  ------------------      ------------------
<S>                                                                                 <C>                      <C>


(In thousands)
Cash Flows from Operating Activities:
Net income (loss)                                                                   $  67,662                $ (49,007)
Adjustments to reconcile net income (loss) to cash flows provided by
  (used in) operating activities:
  Amortization of goodwill and other intangible assets with
    indefinite lives                                                                      ---                   23,943
  Depreciation and other amortization                                                  62,292                   68,033
  Restructuring charges and exit costs                                                  3,079                    8,495
  Impairment charges                                                                      962                    8,343
  Amortization of deferred gains                                                       (5,664)                  (8,421)
  Amortization of deferred financing costs                                              3,223                    2,478
  Gain on disposal of discontinued operations                                         (56,562)                     ---
  Gains on refranchising and other, net                                                (5,952)                 (12,123)
  Amortization of debt premium                                                         (1,388)                  (1,398)
  Gain on early extinguishment of debt                                                (19,246)                  (7,778)
  Changes in Assets and Liabilities, Net of Effects of Acquisitions and
    Dispositions:
  Decrease (increase) in assets:
    Receivables                                                                           (17)                   8,215
    Inventories                                                                           332                      336
    Other current assets                                                               (1,045)                  (3,777)
    Other assets                                                                         (172)                  (3,263)
  Increase (decrease) in liabilities:
    Accounts payable                                                                   (7,823)                 (10,484)
    Accrued salaries and vacations                                                     (4,500)                    (115)
    Accrued taxes                                                                       2,116                    1,460
    Other accrued liabilities                                                         (22,763)                 (33,762)
    Other noncurrent liabilities and deferred credits                                 (11,828)                  (5,612)
                                                                                     --------                 --------
Net cash flows provided by (used in) operating activities                               2,706                  (14,437)
                                                                                     --------                 --------
Cash Flows from Investing Activities:
  Purchase of property                                                                (24,884)                 (25,248)
  Proceeds from disposition of property                                                12,155                   26,157
  Receipts from (advances to) discontinued operations, net                             39,386                  (54,707)
  Proceeds from (deposits for) FRD letters of credit                                    4,083                   (9,790)
                                                                                     --------                 --------
Net cash flows provided by (used in) investing activities                              30,740                  (63,588)
                                                                                     --------                 --------

</TABLE>
                                                       See accompanying notes

<PAGE>

Denny's Corporation (formerly Advantica Restaurant Group, Inc.)
Condensed Consolidated Statements of Cash Flows - Continued
(Unaudited)

<TABLE>
<CAPTION>

                                                                                      Three Quarters            Three Quarters
                                                                                           Ended                     Ended
                                                                                    September 25, 2002        September 26, 2001
                                                                                    ------------------        ------------------
<S>                                                                                 <C>                      <C>

(In thousands)
  Cash Flows from Financing Activities:
    Net (repayments) borrowings under credit agreements                             $ (18,700)               $  73,300
    Long-term debt payments                                                            (4,012)                  (5,487)
    Deferred financing costs                                                           (1,954)                    (176)
    Proceeds from exercise of stock options                                                26                      ---
    Net change in bank overdrafts                                                     (11,467)                 (13,207)
                                                                                     --------                 --------
 Net cash flows (used in) provided by financing activities                            (36,107)                  54,430
                                                                                     --------                 --------

 Decrease in cash and cash equivalents                                                 (2,661)                 (23,595)
  Cash and Cash Equivalents at:
    Beginning of period                                                                 6,696                   27,260
                                                                                     --------                 --------
    End of period                                                                   $   4,035                $   3,665
                                                                                     ========                 ========
</TABLE>

                                                       See accompanying notes

<PAGE>

Denny's Corporation (formerly Advantica Restaurant Group, Inc.)
Notes to Condensed Consolidated Financial Statements
September 25, 2002
(Unaudited)

Note 1.  General
         -------

Denny's Corporation (formerly Advantica Restaurant Group, Inc.), through its
wholly owned subsidiaries, Denny's Holdings, Inc., and Denny's, Inc., owns
and operates the Denny's restaurant brand, or Denny's.  On July 10, 2002, we
completed the divestiture of FRD Acquisition Co., or FRD, a wholly owned
subsidiary.  We have accounted for FRD as a discontinued operation in the
accompanying consolidated financial statements (see Note 9).

With the completion of the FRD divestiture, Advantica Restaurant Group, Inc.
completed its transition from a restaurant holding company to a one-brand
entity; accordingly, on July 10, 2002, we changed our name to Denny's
Corporation.

Our consolidated financial statements are unaudited and include all
adjustments we believe are necessary for a fair presentation of the results of
operations for such interim periods.  Excluding restructuring charges, exit
costs, gains on exchanges of debt and the gain on disposal of discontinued
operations, all such adjustments are of a normal and recurring nature.  These
interim consolidated financial statements should be read in conjunction with our
consolidated financial statements and notes thereto for the year ended
December 26, 2001 and the related Management's Discussion and Analysis of
Financial Condition and Results of Operations, both of which are contained in
our 2001 Annual Report on Form 10-K.  The results of operations for the three
quarters ended September 25, 2002 are not necessarily indicative of the results
for the entire fiscal year ending December 25, 2002.

At September 25, 2002, we had a shareholders' deficit of approximately
$271.8 million and have incurred net losses in each of the last three fiscal
years.  Our revolving credit facility matures on January 7, 2003. We expect
to remain in compliance with our loan covenants throughout fiscal year 2002.
Our ability to maintain continuity of operations will depend on a number of
factors, including our ability to negotiate a new credit facility.  As
discussed further in Note 6, "Revolving Credit Facility", we have entered into
a commitment letter for a new credit facility to replace our existing facility.

The accompanying consolidated financial statements reflect the following changes
in classification:

         As discussed further in Note 2, "Change in Accounting for Goodwill
         and Other Intangible Assets," we reclassified net reorganization value
         in excess of amounts allocable to identifiable assets, or
         reorganization value, of $28.3 million to goodwill at December 26,
         2001.

         As discussed further in Note 8, "Implementation of New Accounting
         Standards," we reclassified a $7.8 million extraordinary item recorded
         during 2001 to other nonoperating income, net during the second
         quarter of 2002.

         Prior to fiscal year 2002, we allocated certain indirect general and
         administrative expenses to costs of franchise and license revenue.
         Beginning with the first quarter of 2002, we have ceased the
         allocation of these indirect costs to the costs of franchise and
         license revenue line.  Prior year general and administrative expenses
         and costs of franchise and license revenue have been reclassified to
         conform to the current year presentation.

These changes in classification have no effect on previously reported total
assets, net income (loss) or income (loss) per share.

Note 2.  Change in Accounting for Goodwill and Other Intangible Assets
         -------------------------------------------------------------

We adopted Statement of Financial Accounting Standard No. 142, or SFAS 142,
"Goodwill and Other Intangible Assets," at the beginning of fiscal year 2002,
and as a result we are no longer amortizing reorganization value, goodwill and
trade names.  Further, in accordance with SFAS 142, we have reclassified $28.3
million of reorganization value to goodwill.   We also reclassified

<PAGE>

reorganization value to goodwill on the consolidated balance sheet as of
December 26, 2001 to be comparable to the consolidated balance sheet as of
September 25, 2002.

During the first quarter of 2002, we completed our testing of intangible assets
with definite lives and our assessment of impairment of goodwill and other
intangible assets with indefinite lives.  We performed an impairment test and
determined that none of the recorded goodwill or other intangible assets with
indefinite lives was impaired.  In accordance with SFAS 142, goodwill and other
intangible assets with indefinite lives will be tested for impairment at least
annually, and more frequently if circumstances indicate that they may be
impaired.  We anticipate performing our annual impairment test during the fourth
quarter of each fiscal year.

The changes in carrying amounts of goodwill, including amounts previously
reported as reorganization value, for the three quarters ended September 25,
2002 following the adoption of SFAS 142 are as follows:

         (In thousands)
         Balance at December 26, 2001                              $ 53,353
         Reversal of income tax liabilities related
           to reorganization                                           (987)
         Reduction of liabilities recorded in connection
           with a business combination                                 (951)
                                                                    -------
         Balance at September 25, 2002                             $ 51,415
                                                                    =======

The following table reflects intangible assets as reported at September 25,
2002 and at December 26, 2001 following the adoption of SFAS 142:

<TABLE>
<CAPTION>

                                                                September 25, 2002                    December 26, 2001
                                                                ------------------                    -----------------
                                                           Gross                                  Gross
                                                         Carrying         Accumulated           Carrying         Accumulated
                                                          Amount         Amortization            Amount         Amortization
                                                         --------        ------------           --------        ------------
                                                         <C>              <C>                    <C>               <C>

(In thousands)
Intangible assets with indefinite lives:
   Trade names                                           $  42,323        $     ---             $  42,323          $     ---
   Liquor licenses                                           1,221              ---                 1,221                ---
Intangible assets with definite lives:
   Franchise agreements                                     76,855           27,087                80,049             23,828
   Foreign license agreements                                2,041            1,063                 2,041                894
                                                          --------         --------              --------           --------
                                                         $ 122,440        $  28,150             $ 125,634          $  24,722
                                                          ========         ========              ========           ========
</TABLE>

Estimated amortization expense for intangible assets with definite lives in the
next five years is as follows:


          (In thousands)
          Remainder of 2002                                   $ 1,482
          2003                                                  6,002
          2004                                                  5,727
          2005                                                  5,561
          2006                                                  5,261

<PAGE>

The following table reflects consolidated operating results as though we
adopted SFAS 142 as of the beginning of the three quarters ended
September 26, 2001:

<TABLE>
<CAPTION>
                                                                       Quarter Ended                        Three Quarters
                                                                                                                 Ended
                                                            September 25,       September 26,      September 25,       September 26,
                                                                 2002                2001               2002                2001
                                                            -------------       -------------      -------------       -------------
<S>                                                         <C>                 <C>                <C>                 <C>


(In thousands)
Reported net income (loss)                                  $ 56,134            $  (4,780)         $ 67,662            $ (49,007)
Add back amortization of reorganization value                    ---                7,067               ---               21,792
Add back goodwill amortization                                   ---                  409               ---                1,270
Add back trade name amortization                                 ---                  294               ---                  881
                                                             -------             --------           -------             --------
Adjusted net income (loss)                                  $ 56,134            $   2,990          $ 67,662            $ (25,064)
                                                             =======             ========           =======             ========

Reported basic income (loss) per share                      $   1.39            $   (0.12)         $   1.68            $   (1.22)
Add back amortization of reorganization value                    ---                 0.17               ---                 0.54
Add back goodwill amortization                                   ---                 0.01               ---                 0.03
Add back trade name amortization                                 ---                 0.01               ---                 0.02
                                                             -------             --------           -------             --------
Adjusted net income (loss)                                  $   1.39            $    0.07          $   1.68            $   (0.63)
                                                             =======             ========           =======             ========

Reported diluted income (loss) per share                    $   1.39            $   (0.12)         $   1.67            $   (1.22)
Add back amortization of reorganization value                    ---                 0.17               ---                 0.54
Add back goodwill amortization                                   ---                 0.01               ---                 0.03
Add back trade name amortization                                 ---                 0.01               ---                 0.02
                                                             -------             --------           -------             --------
Adjusted net income (loss)                                  $   1.39            $    0.07          $   1.67            $   (0.63)
                                                             =======              =======           =======             ========
</TABLE>

Note 3.  Restructuring Charges and Exit Costs
         ------------------------------------

As a result of changes in our organizational structure and in our portfolio of
restaurants, we have recorded charges for restructuring and exit costs.  These
costs consist primarily of severance and outplacement costs for terminated
employees and the costs of future obligations related to closed units or units
identified for closure.  In assessing the cost of future obligations related to
closed units or units identified for closure, we make assumptions regarding the
timing of units' closures, amounts of future subleases, amounts of future
property taxes and costs of closing the units.  If these estimates or their
related assumptions change in the future, we may be required to record
additional exit costs or reduce exit costs previously recorded.

Exit costs were comprised of the following:

<TABLE>
<CAPTION>
                                                                       Three Quarters Ended
                                                                 September 25,     September 26,
                                                                      2002              2001
                                                                 -------------     -------------
<S>                                                              <C>               <C>


  (In thousands)
  Future rents, net of estimated sublease income                 $ 2,485           $ 3,378
  Property taxes                                                     266             2,952
  Brokerage commissions                                              ---               942
  De-identification and maintenance costs                            232               878
  Severance and other costs                                           96               345
                                                                  ------            ------
                                                                 $ 3,079           $ 8,495
                                                                  ======            ======

</TABLE>

No exit costs were recorded for the quarters ended September 25, 2002 and
September 26, 2001.

Exit costs recorded during the three quarters ended September 25, 2002 consist
of approximately $0.6 million related to the closure of underperforming units
and $2.5 million related to future lease obligations on Denny's former
corporate headquarters facility due to the bankruptcy of our most significant
subtenant.  At September 25, 2002, discounted accrued exit costs totaled

<PAGE>

approximately $22.6 million.  Cash payments for exit cost liabilities paid
during the three quarters ended September 25, 2002 were approximately $7.0
million.  Estimated cash payments related to exit cost liabilities in the next
five years are as follows:

         (in thousands)
         Remainder of 2002                                           $ 2,203
         2003                                                          7,761
         2004                                                          5,014
         2005                                                          2,711
         2006                                                          2,359

During 2000 and 2001, we recorded severance and outplacement costs related to
restructuring plans of $13.6 million.  Through September 25, 2002, $13.2
million of these costs have been paid, of which $3.4 million was paid during
the three quarters ended September 25, 2002.  The remaining $0.4 million is
expected to be paid out by the first quarter of 2003.

Note 4.  Income Taxes
         ------------

On March 9, 2002, President Bush signed into law H.R. 3090, the Job Creation
and Worker Assistance Act of 2002, or the Act. The Act will allow us to carry
back alternative minimum tax, or AMT, net operating losses generated during
2001, which will result in a cash refund of 1998 AMT taxes paid of
approximately $2.7 million.  During the first quarter of 2002, we recorded a
receivable and a corresponding reduction of current income tax expense related
to the expected cash refund.  We received the cash refund subsequent to the end
of the third quarter.

Note 5.  Income (Loss) Per Share Applicable to Common Shareholders
         ---------------------------------------------------------

<TABLE>
<CAPTION>

                                                                       Quarter Ended                      Three Quarters Ended
                                                                       -------------                      --------------------
                                                              September 25,     September 26,       September 25,    September 26,
                                                                   2002              2001                2002             2001
                                                              -------------     -------------       -------------    -------------
<S>                                                           <C>               <C>                 <C>              <C>


(In thousands)
Numerator for basic and diluted (loss) income per share ---
     (loss) income from continuing operations available to
     common shareholders                                      $     (428)       $  (4,780)          $ 11,100         $ (49,007)
                                                               =========         ========            =======          ========
Denominator:
   Denominator for basic (loss) income per share ---
      weighted average shares                                     40,280           40,143             40,264            40,134
   Effect of dilutive securities:
      Options                                                        ---              ---                220               ---
                                                               ---------         --------            -------          --------
   Denominator for diluted (loss) income per share ---
      adjusted weighted average shares and assumed
      conversions of dilutive securities                          40,280           40,143             40,484            40,134
                                                               =========         ========            =======          ========

   Basic (loss) income per share from continuing operations   $    (0.01)       $   (0.12)          $   0.28         $   (1.22)
                                                               =========         ========            =======          ========
   Diluted (loss) income per share from continuing
      operations                                              $    (0.01)       $   (0.12)          $   0.27         $   (1.22)
                                                               =========         ========            =======          ========

</TABLE>

The calculations of basic and diluted income (loss) per share have been based on
the weighted average number of shares outstanding.  Warrants have been omitted
from the calculations for all periods presented because they have an
antidilutive effect on income (loss) per share.  Except for the three quarters
ended September 25, 2002, options have been omitted from the calculations
because they have an antidilutive effect on loss per share.

<PAGE>


Note 6.  Revolving Credit Facility
         -------------------------

Denny's, Inc. is the borrower under a senior secured credit facility, or credit
facility, with JP Morgan Chase Bank and other lenders which provides Denny's
with a working capital and letter of credit facility.  Under the terms of the
credit facility, commitments were reduced from $200.0 million to $155.3
million as of July 10, 2002 upon receipt of cash payments related to Denny's
receivable and deposits securing outstanding letters of credit under the
Coco's/Carrows credit facility (see Note 9).  The cash payments included the
collection of scheduled payments and the payment received in connection with
the divestiture of FRD on July 10, 2002 (see Note 9). At September 25, 2002, we
had working capital advances of $40.0 million and letters of credit outstanding
of $52.1 million under the credit facility, leaving a net availability of $63.2
million.  Advances under the credit facility accrue interest at a variable rate
(approximately 5.9% at September 25, 2002) based on the prime rate or an
adjusted Eurodollar rate.  The credit facility matures on January 7, 2003;
therefore, we have classified the amounts outstanding under the facility as
current liabilities on our consolidated balance sheet at September 25, 2002.

We were in compliance with the terms of the credit facility at September 25,
2002.  Under the most restrictive provision of the credit facility (the interest
coverage ratio), EBITDA could have been approximately $13.7 million less for
the four quarters ended September 25, 2002 and we would still have been in
compliance.

Subsequent to September 25, 2002, we entered into a commitment letter, pursuant
to which we received commitments from JPMorgan Chase Bank, Farallon Capital
Management, LLC and Foothill Capital Corporation with respect to a $125.0
million, two-year senior secured revolving credit facility, or new facility, of
which up to $60.0 million will be available for the issuance of letters of
credit. The new facility will refinance the existing facility and will be used
for working capital, capital expenditures and other general corporate purposes.
The new facility will be guaranteed by the Company and its other subsidiaries
and will be generally secured by liens on the same collateral that secure the
existing facility.  In addition, the new facility will be secured by
first-priority mortgages on approximately 250 owned restaurant properties.  The
closing of the new facility, expected to occur in the fourth quarter of 2002, is
subject to, among other conditions, the negotiation of definitive agreements on
mutually acceptable terms, as well as obtaining commitments for the balance of
the new facility from other lenders.  J. P. Morgan Securities, Inc. will act as
lead arranger for the new facility.

Note 7.  Debt
         ----

On April 15, 2002, we exchanged $88.1 million aggregate principal amount of
Denny's Corporation's 11 1/4% senior notes due 2008, or 11 1/4% Notes, for
$70.4 million aggregate principal amount of 12 3/4% senior notes due 2007, or
12 3/4% Notes.  Denny's Corporation and its wholly owned subsidiary, Denny's
Holdings, Inc. (the direct parent of Denny's restaurant operations), are
jointly obligated with respect to the 12 3/4% Notes; therefore, the 12 3/4%
Notes are structurally senior to the 11 1/4% Notes.  The 11 1/4% Notes pay
interest on January 15 and July 15 of each year and will expire on January 7,
2008.  The 12 3/4% Notes pay interest on March 31 and September 30 of each year
and will expire on September 30, 2007.  As a result of our completing the
exchange offer, we recorded a gain of $19.2 million in the three quarters ended
September 25, 2002 (which is included in other nonoperating income in the
accompanying financial statements).  In addition, costs of approximately $1.4
million incurred in connection with this exchange of debt were deferred and
will be amortized over the term of the 12 3/4% Notes.  At September 25, 2002,
$441.5 million aggregate principal amount of 11 1/4% Notes was outstanding and
$70.4 million aggregate principal amount of 12 3/4% Notes was outstanding.

Subsequent to September 25, 2002, we closed a series of privately negotiated
transactions for the exchange of an additional aggregate $33.2 million
principal amount of 11 1/4% Notes for $26.6 million principal amount of
12 3/4% Notes. The 12 3/4% Notes were issued under a tack-on provision of the
indenture that governs the 12 3/4% Notes which allows up to $50 million of
additional notes to be issued under the same indenture.  As a result of our
completing the additional exchange, we expect to record a gain of approximately
$7 million in the fourth quarter of 2002.

<PAGE>

Note 8.  Implementation of New Accounting Standards
         ------------------------------------------

In July 2001, the Financial Accounting Standards Board, or FASB, issued
Statement of Financial Accounting Standards No. 141, or SFAS 141, "Business
Combinations." SFAS 141 requires the purchase method of accounting for
business combinations initiated after June 27, 2001 and eliminates the
pooling-of-interests method.  Our adoption of SFAS 141 has had no impact on our
financial statements.

Also in July 2001, the FASB issued SFAS 142, "Goodwill and Other Intangible
Assets," which became effective for us on December 27, 2001, the first day of
our 2002 fiscal year.  SFAS 142 requires us, among other things, to discontinue
goodwill amortization, including the amortization of reorganization value. In
addition, the standard provides for reclassifying certain intangibles as
goodwill, reassessing the useful lives of intangibles, reclassifying certain
intangibles out of previously reported goodwill and identifying reporting units
for purposes of assessing potential future impairments of goodwill.  See Note 2
for a discussion of the effects of adopting this new accounting standard.

In October 2001, the FASB issued SFAS 144, "Accounting for the Impairment or
Disposal of Long-Lived Assets," which addresses financial accounting and
reporting for the impairment or disposal of long-lived assets.  SFAS 144
supersedes Statement of Financial Accounting Standards No. 121, "Accounting for
the Impairment of Long-Lived Assets and for Long-Lived Assets to be Disposed
Of," and the accounting and reporting provisions of Accounting Principles
Board Opinion No. 30, "Reporting the Results of Operations - Reporting the
Effects of Disposal of a Segment of a Business, and Extraordinary, Unusual and
Infrequently Occurring Events and Transactions," related to the disposal of a
segment of a business.  SFAS 144 became effective for us on December 27, 2001,
the first day of our 2002 fiscal year.  Our adoption of SFAS 144 had no impact
on our financial position or results of operations.

In April 2002, the FASB issued SFAS 145, "Rescission of FASB Statements No. 4,
44, and 64, Amendment of FASB Statements No. 13, and Technical Corrections."
Among other things, SFAS 145 eliminates FASB Statement No. 4, or SFAS 4,
"Reporting Gains and Losses from Extinguishment of Debt."  Under SFAS 4, all
gains and losses from extinguishment of debt were required to be aggregated and,
if material, classified as an extraordinary item, net of any related income tax
effect.  As a result of the elimination of SFAS 4, gains and losses from
extinguishment of debt should be classified as extraordinary items only if they
meet the criteria in APB Opinion No. 30, "Reporting the Results of Operations -
Reporting the Effects of Disposal of a Segment of a Business, and
Extraordinary, Unusual and Infrequently Occurring Events and Transactions."
The provisions of SFAS 145 related to the rescission of SFAS 4 are effective
for fiscal years beginning after May 15, 2002.  We have early adopted SFAS 145
in the second quarter of 2002.  See Note 1 for a discussion of the effects of
adopting this new accounting standard.

In June 2002, the FASB issued SFAS 146, "Accounting for Costs Associated with
Exit or Disposal Activities."  This statement replaces Emerging Issues Task
Force (EITF) Issue No. 94-3, "Liability  Recognition for Certain Employee
Termination Benefits and Other Costs to Exit an Activity (including certain
costs incurred in a Restructuring)".  Among other things, SFAS 146 requires that
a liability relating to an exit activity be recorded when incurred as opposed to
the date of a company's commitment to exit an activity.  The provisions of
SFAS 146 are effective for exit and disposal activities initiated after
December 31, 2002 with earlier application encouraged.  We are currently
assessing the effects of adopting SFAS 146 on our financial position and
results of operations.

Note 9.  Discontinued Operations
         -----------------------

On July 10, 2002, through FRD's bankruptcy  proceedings, the divestiture of
FRD was completed.  As part of the transaction, Denny's received a payment of
approximately $32.5 million related to FRD's senior secured credit facility for
which Denny's was the lender.  Such payment represented all outstanding
obligations under the facility less a $10 million discount.

FRD's letters of credit under the senior secured credit facility in the amount
of $5.6 million remain outstanding.  The letters of credit secure certain
obligations of FRD and its subsidiaries under various insurance programs
which are anticipated to be satisfied in the ordinary course of business.
Denny's has agreed to continue to provide the cash collateral supporting these

<PAGE>

letters of credit (currently $5.7 million) for a fee until the letters of
credit terminate or are replaced.  Denny's also received a separate four-year
note payable from reorganized FRD in the amount of $5.7 million for continuing
to provide the cash collateral.  The cash collateral has been deposited with
one of Coco's and Carrows former lenders and is reflected as a component of
other noncurrent assets at September 25, 2002.  Prior to July 10, 2002, the
deposit was reflected as a component of other current assets.

Also on July 10, 2002, Denny's entered into a service agreement to provide
various management and support services to FRD over an initial term of up to one
year.  Under the terms of the service agreement, FRD has given notice of
termination of all such services, with the last of such services terminating on
November 30, 2002.  Total fees received under the service agreement from
commencement on July 10, 2002 through September 25, 2002 were $1.1 million.
Fees of approximately $1.2 million are expected to be received in the fourth
quarter through the termination date. As a result of the disposal of FRD and
the termination of the service agreement, we expect to reduce our number of
support staff positions by approximately thirty-three in the fourth quarter of
2002.

As a result of the divestiture of FRD, we recorded a gain on the disposal of
discontinued operations in the quarter ended September 25, 2002 of $56.6
million, representing the receipt of proceeds of approximately $32.5 million,
and the elimination of the net liabilities of discontinued operations of
approximately $24.1 million at July 10, 2002.

As required by our credit facility, the proceeds received from the divestiture
of FRD were used to reduce the balance outstanding under our credit facility by
approximately $32.5 million.

Item 2.  Management's Discussion and Analysis of Financial Condition and Results
         of Operations

The following discussion is intended to highlight significant changes in our
financial position as of September 25, 2002 and results of operations for the
quarter and three quarters ended September 25, 2002 compared to the quarter and
three quarters ended September 26, 2001.  The forward-looking statements
included in Management's Discussion and Analysis of Financial Condition and
Results of Operations, which reflect our best judgment based on factors
currently known, involve risks, uncertainties, and other factors which may
cause our actual performance to be materially different from the performance
indicated or implied by such statements.  Such factors include, among others:
our ability to maintain continuity of operations and completing the refinancing
of our credit facility prior to its January 7, 2003 maturity date; competitive
pressures from within the restaurant industry; the level of success of our
operating initiatives and advertising and promotional efforts, including the
initiatives and efforts specifically mentioned herein; adverse publicity;
changes in business strategy or development plans; terms and availability of
capital; regional weather conditions; overall changes in the general economy,
particularly at the retail level; and other factors included in the discussion
below, or in Management's Discussion and Analysis of Financial Condition and
Results of Operations contained in our Annual Report on Form 10-K for the year
ended December 26, 2001 and in Exhibit 99 thereto.

<PAGE>


Restaurant Operations and Unit Activity
---------------------------------------

<TABLE>
<CAPTION>


                                                             Quarter Ended                           Three Quarters Ended
                                                             -------------                           --------------------
                                            September 25,   September 26,    Increase/    September 25,   September 26,   Increase/
                                                 2002            2001        (Decrease)        2002            2001      (Decrease)
                                            -------------   -------------    ----------   -------------   -------------   ----------
<S>                                         <C>             <C>              <C>          <C>             <C>              <C>


(Dollars in thousands)
Total systemwide sales (a)                  $ 586,163       $ 609,965        (3.9%)       $ 1,689,105     $ 1,739,047      (2.9%)

EBITDA as defined (b)                          40,082          42,912        (6.6%)           113,543         108,053       5.1%

Company-owned data:
   Average unit sales                           385.5           379.2         1.7%            1,100.0         1,062.1       3.6%
   Same-store sales (decrease)
     increase (c) (d)                            (1.5%)           3.2%                           (0.7%)           2.5%
   Guest check average increase (c) (d)           0.7%            1.2%                            1.3%            2.1%
   Guest count (decrease) increase (c) (d)       (2.2%)           2.0%                           (2.0%)           0.4%

Franchise data:
   Average unit sales                           322.8           321.9         0.3%               920.0          906.1       1.5%
   Same-store sales (decrease)
     increase (c) (d)                            (2.4%)           1.1%                            (1.7%)          0.7%


</TABLE>
__________________________

(a)      Total systemwide sales includes sales from company-owned, franchised
         and licensed restaurants and is not a measure which has been
         determined in accordance with accounting principles generally accepted
         in the United States of America.
(b)      We define "EBITDA" as operating income (loss) before depreciation,
         amortization and impairment, restructuring and exit costs as follows:

<TABLE>
<CAPTION>

                                                                         Quarter Ended                   Three Quarters Ended
                                                              September 25,       September 26,     September 25,     September 26,
                                                                   2002                2001              2002              2001
                                                              -------------       -------------     -------------     -------------
<S>                                                           <C>                 <C>               <C>               <C>


        (In thousands)
         Operating income (loss)                              $ 18,883            $  13,694         $   47,210        $     (761)
         Total amortization and depreciation                    20,734               29,218             62,292            91,976
         Total impairment, restructuring and exit costs            465                  ---              4,041            16,838
                                                               -------             --------          ---------         ---------
                                                              $ 40,082            $  42,912         $  113,543        $  108,053
                                                               =======             ========          =========         =========

</TABLE>

         We believe that EBITDA as defined is a key internal measure used to
         evaluate the amount of cash flow available for debt repayment and
         funding of additional investments. EBITDA as defined is not a measure
         defined by accounting principles generally accepted in the United
         States of America and should not be considered as an alternative to
         net income or cash flow data prepared in accordance with accounting
         principles generally accepted in the United States of America.  Our
         measure of EBITDA as defined may not be comparable to similarly titled
         measures reported by other companies.
(c)      Same-store sales, guest check average, and guest count calculations
         include restaurants that were open the same days in both the current
         year and prior year.
(d)      Prior year amounts have not been restated for 2002 comparable units.

<PAGE>

The table below summarizes Denny's restaurant unit activity for the quarter
ended September 25, 2002.

<TABLE>
<CAPTION>


                                Ending          Units                        Units            Ending                 Ending
                                Units          Opened/         Units         Sold/            Units                   Units
                            June 26, 2002     Acquired     Refranchised     Closed     September 25, 2002      September 26, 2001
                            -------------     --------     ------------     ------     ------------------      -----------------
<S>                         <C>               <C>          <C>              <C>        <C>                     <C>


Company-owned                     588             ---           ---           (11)             577                      638
Franchised units                1,112               9           ---           (26)           1,095                    1,124
Licensed units                     14             ---           ---           ---               14                       14
                                -----           -----         -----         -----            -----                    -----
                                1,714               9           ---           (37)           1,686                    1,776
                                =====           =====         =====         =====            =====                    =====

</TABLE>

Results of Operations
---------------------

Quarter Ended September 25, 2002 Compared to Quarter Ended September 26, 2001
-----------------------------------------------------------------------------

Company Operations

Company restaurant sales are the revenues generated from restaurants operated
by Denny's.  Company restaurant sales decreased $22.4 million (9.1%) due to a
net 61-unit decrease in company-owned restaurants and a 1.5% decline in
same-store sales for the current quarter.  The decrease in company-owned
restaurants resulted from store closures and the sale of restaurants to
franchisees.

Total costs of company restaurant sales decreased $15.3 million (7.4%),
driven by the decrease in the number of company-owned restaurants.  As a
percentage of company restaurant sales, total costs of company restaurant sales
increased to 85.5% from 83.9%.  Product costs decreased to 23.5% from 24.6%
resulting from lower commodity costs and improved food waste controls.  Payroll
and benefits increased to 41.6% from 39.2% due to increased restaurant staffing
levels, wage rate increases and higher health benefits costs.  Occupancy costs
increased to 5.5% from 5.4% of company restaurant sales.  Other operating
expenses increased to 14.8% from 14.7% as higher marketing expenses were offset
by lower utilities costs and repairs and maintenance expenses compared to the
prior year.

Operating margins for company-owned restaurants were $32.5 million (14.5% of
company restaurant sales) for the quarter ended September 25, 2002, compared
with $39.6 million (16.1% of company restaurant sales) for the quarter ended
September 26, 2001.

Franchise Operations

Franchise and license revenues are the revenues received by Denny's from its
franchisees and include royalties, initial franchise fees and occupancy revenue
related to restaurants leased or subleased to franchisees.

Franchise and license revenue was $23.4 million for the quarter ended
September 25, 2002, comprised of royalties and initial franchise fees of $14.7
million and occupancy revenue of $8.7 million, compared with $24.2 million for
the quarter ended September 26, 2001, comprised of royalties and fees of $15.2
million and occupancy revenues of $9.0 million.  The revenue decrease of $0.8
million (3.5%) resulted primarily from a decrease in initial franchise fees on
fewer refranchising transactions.

Costs of franchise and license revenue include occupancy costs related to
restaurants leased or subleased to franchisees and direct costs consisting
primarily of payroll and benefit costs of franchise operations personnel, bad
debt expense and marketing expenses, net of marketing contributions received
from franchisees.

Costs of franchise and license revenue were $7.3 million for the quarter ended
September 25, 2002, comprised of occupancy costs of $5.8 million and other
direct expenses of $1.5 million, compared with $7.4 million for the quarter
ended September 26, 2001, comprised of occupancy costs of $5.3 million and
other direct expenses of $2.1 million.  Costs of franchise and license revenue

<PAGE>

were essentially flat as a $1.9 million decrease in net marketing expenses was
offset by a $0.5 million decrease in rent expense and a net $1.4 million
reduction in bad debt expense in the prior year related to the collection of
certain past due accounts.  As a percentage of franchise and license revenues,
these costs increased to 31.5% for the quarter ended September 25, 2002 from
30.6% for the quarter ended September 26, 2001.

Franchise operating margins were $16.0 million (68.5% of franchise and license
revenue) for the quarter ended September 25, 2002 compared with $16.8 million
(69.4% of franchise and license revenue) for the quarter ended
September 26, 2001.

Other Operating Costs and Expenses

Other operating costs and expenses such as general and administrative expenses
and depreciation and amortization expense relate to both company and franchise
operations.

General and administrative expenses decreased $4.5 million (29.5%) compared with
the prior year quarter.  The decrease resulted primarily from reductions in
corporate overhead costs related to recent workforce reductions.  Depreciation
and other amortization, including amortization of goodwill and other intangibles
with indefinite lives, decreased $8.5 million primarily as a result of fewer
company-owned units and due to the implementation of SFAS 142 relating to the
discontinuance of the amortization of excess reorganization value.  See Notes 2
and 8 to our consolidated financial statements.

Gains on refranchising and other, net for the quarter ended September 25, 2002
of $2.4 million were the result of the sale of surplus properties.  Gains of
$1.8 million recorded for the quarter ended September 26, 2001 were the result
of refranchising company-owned restaurants.

Operating income was $18.9 million for the quarter ended September 25, 2002
compared with income of $13.7 million for the quarter ended September 26, 2001.

Interest expense, net for the quarter ended September 25, 2002 was comprised of
$19.6 million interest expense offset by $0.6 million interest income compared
with $19.9 million interest expense offset by $1.6 million interest income for
the quarter ended September 26, 2001.  The decrease in interest expense resulted
from lower borrowings under our credit facility and our senior notes exchange
(see Note 7 to our consolidated financial statements), partially offset by
higher deferred financing cost amortization related to our credit facility.
The decrease in interest income resulted from lower cash balances and a
reduction in Denny's receivable balance under Coco's and Carrows' credit
facility.

The provision for income taxes from continuing operations of $0.3 million and
$0.2 million for the quarters ended September 25, 2002 and September 26, 2001,
respectively, primarily represent gross receipts based state and foreign
income taxes which do not directly fluctuate in relation to changes in loss
before income taxes. We have provided valuation allowances related to any
benefits from income taxes resulting from the application of a statutory tax
rate to our net operating losses.  Accordingly, no additional (benefit from) or
provision for income taxes has been reported for the periods presented.

As a result of the divestiture of FRD, we recorded a gain on disposal of
discontinued operations of $56.6 million during the quarter ended
September 25, 2002.  See Note 9 to our consolidated financial statements.

Net income was $56.1 million for the quarter ended September 25, 2002 compared
with a net loss of $4.8 million for the quarter ended September 26, 2001 due to
the factors noted above.

<PAGE>

Results of Operations
---------------------

Three Quarters Ended September 25, 2002 Compared to Three Quarters Ended
------------------------------------------------------------------------
September 26, 2001
------------------

Company Operations

Company restaurant sales decreased $71.6 million (9.9%) primarily due to a net
61-unit decrease in company-owned restaurants and a 0.7% decline in same-store
sales for the three quarters ended September 25, 2002. The decrease in
company-owned restaurants resulted from store closures and the sale of
restaurants to franchisees.

Total costs of company restaurant sales decreased $69.7 million (11.2%), driven
by the decrease in the number of company-owned restaurants.  As a percentage of
company restaurant sales, total costs of company restaurant sales decreased to
84.7% from 85.9% as a result of the closure of certain underperforming units as
well as other operating costs reductions.  Specifically, product costs
decreased to 23.9% from 24.9% resulting from lower commodity costs and improved
food waste controls.  Payroll and benefits increased to 41.2% from 40.2% due to
increased restaurant staffing levels, wage rate increases and higher health
benefits costs.  Occupancy costs decreased to 5.7% from 6.0% as a result of the
closure of underperforming units.  Other operating expenses decreased to 13.9%
from 14.8% primarily as a result of lower utility costs, lower repairs and
maintenance expenses and lower legal settlement costs, including a $1.0 million
reduction in estimated legal settlement liabilities resulting from the
favorable settlement of certain cases.

Operating margins for company-owned restaurants were $100.1 million (15.3% of
company restaurant sales) for the three quarters ended September 25, 2002,
compared with $102.0 million (14.1% of company restaurant sales) for the three
quarters ended September 26, 2001.

Franchise Operations

Franchise and license revenue was $68.5 million for the three quarters ended
September 25, 2002, comprised of royalties and initial franchise fees of $42.7
million and occupancy revenue of $25.8 million, compared with $68.0 million
for the three quarters ended September 26, 2001, comprised of royalties and
fees of $42.3 million and occupancy revenues of $25.7  million.  The revenue
increase of $0.5 million (0.6%) resulted primarily from an increase in average
unit sales of franchise restaurants.

Costs of franchise and license revenue were $22.0 million for the three quarters
ended September 25, 2002, comprised of occupancy costs of $17.0 million and
other direct expenses of $5.0 million, compared with $24.5 million for the
three quarters ended September 26, 2001, comprised of occupancy costs of $15.3
million and other direct expenses of $9.2  million.  Costs of franchise and
license revenue decreased $2.5 million (10.2%) driven by a $5.2 million
decrease in net marketing expense partially offset by a $1.7 million increase
in rent expense.  Additionally, prior year costs benefited from a net $0.8
million reduction in bad debt expense related to the collection of certain past
due accounts.  As a percentage of franchise and license revenues, these costs
decreased to 32.1% for the three quarters ended September 25, 2002 from 35.9%
for the three quarters ended September 26, 2001.

Our franchise operating margins were $46.5 million (67.9% of franchise and
license revenue) for the three quarters ended September 25, 2002 compared with
$43.6 million (64.1% of franchise and license revenue) for the three quarters
ended September 26, 2001.

Other Operating Costs and Expenses

General and administrative expenses decreased $10.6 million (21.4%) for the
three quarters ended September 25, 2002 compared with the three quarters ended
September 26, 2001.  The three quarters ended September 26, 2001 included
approximately $1.6 million of nonrecurring senior management recruiting
expenses.  The remaining decrease resulted from reductions in corporate
overhead costs related to workforce reductions.  Depreciation and other
amortization, including amortization of goodwill and other intangible assets
with indefinite lives, decreased $29.7 million primarily as a result of fewer

<PAGE>

company-owned units and due to the implementation of SFAS 142 relating to the
discontinuance of amortization of excess reorganization value.  See Notes 2 and
8 to our consolidated financial statements.

Lower refranchising activity in the three quarters ended September 25, 2002
resulted in a $6.2 million decrease in gains on refranchising and other, net.

Exit costs of $3.1 million recorded in 2002 primarily represent additional
provisions for future rent obligations on Denny's former corporate
headquarters facility in California due to the bankruptcy of our most
significant subtenant.  For additional information concerning restructuring
charges and exit costs, see Note 3 to our consolidated financial statements.

Operating income was $47.2 million for the three quarters ended September 25,
2002 compared with a loss of $0.8 million for the three quarters ended
September 26, 2001.

Interest expense, net for the three quarters ended September 25, 2002 was
comprised of $60.2 million of interest expense offset by $3.0 million of
interest income compared with $59.9 million of interest expense offset by $5.2
million of interest income for the three quarters ended September 26, 2001. The
decrease in interest expense resulted from lower borrowings under our credit
facility and our senior notes exchange (see Note 7 to our consolidated
financial statements), partially offset by higher deferred financing cost
amortization related to our credit facility and higher interest expense related
to discounted liabilities for exit costs (see Note 3 to our consolidated
financial statements).  The decrease in interest income resulted from lower
cash balances and a reduction in Denny's receivable balance under Coco's and
Carrows' credit facility.

Other nonoperating income for the three quarters ended September 25, 2002
primarily represents a gain of $19.2 million on the exchange of debt. For
further information regarding our debt exchange, see Note 7 to the consolidated
financial statements.  During the first quarter of 2001, as a result of the
settlement of the remaining issues related to our former information systems
outsourcing contract with IBM, approximately $7.8 million of capital lease
obligations were forgiven and a gain was recorded as a component of other
nonoperating income.

For the three quarters ended September 25, 2002, we recorded a benefit from
income taxes of $1.8 million.  The benefit from income taxes resulted from a
$2.7 million benefit recorded in the first quarter of 2002 related to the
enactment of H.R. 3090, the Job Creation and Worker Assistant Act of 2002. See
Note 4 to our consolidated financial statements.  Excluding this benefit,  we
recorded a provision for income taxes of $0.9 million for the three quarters
ended September 25, 2002 compared with a provision for income taxes of $1.3
million for the three quarters ended September 26, 2001.  These provisions for
income taxes primarily represent gross receipts based state and foreign income
taxes which do not directly fluctuate in relation to changes in income (loss)
before income taxes. We have reduced or provided valuation allowances related
to any provisions for (benefit from) income taxes resulting from the
application of a statutory tax rate to our net operating income (losses).
Accordingly, no additional (benefit from) or provision for income taxes has
been reported for the periods presented.

As a result of the divestiture of FRD, we recorded a gain on disposal of
discontinued operations of $56.6 million during the three quarters ended
September 25, 2002.  See Note 9 to our consolidated financial statements.

Net income was $67.7 million for the three quarters ended September 25, 2002
compared with a net loss of $49.0 million for the three quarters ended
September 26, 2001 due to the factors noted above.

Liquidity and Capital Resources
-------------------------------

Revolving Credit Facility

At September 25, 2002, commitments under our revolving credit facility were
$155.3 million.  We had working capital advances of $40.0 million and letters
of credit outstanding of $52.1 million under the credit facility at
September 25, 2002 leaving a net availability of $63.2 million.  Advances under
the credit facility accrue interest at a variable rate (approximately 5.9% at
September 25, 2002) based on the prime rate or an adjusted Eurodollar rate. The
credit facility matures on January 7, 2003; therefore, we have classified the

<PAGE>

amounts outstanding under the facility as current liabilities on our
consolidated balance sheet at September 25, 2002.

We were in compliance with the terms of the credit facility at September 25,
2002.  Under the most restrictive provision of the credit facility (the
interest coverage ratio), EBITDA could have been approximately $13.7 million
less for the four quarters ended September 25, 2002 and we would still have
been in compliance.

Subsequent to September 25, 2002, we entered into a commitment letter, pursuant
to which we received commitments from JPMorgan Chase Bank, Farallon Capital
Management, LLC and Foothill Capital Corporation with respect to a $125.0
million, two-year senior secured revolving credit facility, or new facility, of
which up to $60.0 million will be available for the issuance of letters of
credit. The new facility will refinance the existing facility and will be
used for working capital, capital expenditures and other general corporate
purposes.  The new facility will be guaranteed by the Company and its other
subsidiaries and will be generally secured by liens on the same collateral that
secured the existing facility.  In addition, the new facility will be secured
by first-priority mortgages on approximately 250 owned restaurant properties.
The closing of the new facility, expected to occur in the fourth quarter of
2002, is subject to, among other conditions, the negotiation of definitive
agreements on mutually acceptable terms, as well as obtaining commitments for
the balance of the new facility from other lenders.  J.P. Morgan Securities,
Inc. will act as lead arranger for the new facility.

Cash Requirements

Our principal capital requirements have been largely associated with remodeling
and maintaining our existing restaurants and facilities.  For the three
quarters ended September 25, 2002, our capital expenditures were $25.8 million.
Of that amount, approximately $0.9 million was financed through capital
leases.  Capital expenditures during 2002 are expected to total $35.0 million
to $45.0 million; however, we are not committed to spending this amount and
could spend less if circumstances require.

Historically, we have met our liquidity requirements with internally generated
funds, external borrowings and, in recent years, proceeds from asset sales.  Our
ability to meet liquidity requirements and debt service obligations and to
maintain continuity of operations will depend on a number of factors, including
our ability to refinance our current credit facility by its January 7, 2003
maturity date and our ability to meet targeted levels of operating cash flows.
As noted above, we have entered into a commitment letter for a new credit
facility to replace our existing facility.  Our ability to achieve operating
cash flow targets will depend upon consumer tastes, the success of marketing
initiatives and other efforts to increase customer traffic in our restaurants,
prevailing economic conditions and other matters, some of which are beyond our
control.  There can be no assurance that targeted levels of operating cash
flows will actually be achieved.  We believe that, together with funds
available under the credit facility and the new facility, we will have
sufficient cash flow from operations to meet working capital requirements, to
pay interest and scheduled amortization on all of our outstanding indebtedness
and to fund anticipated capital expenditures.

Our working capital deficit was $146.2 million at September 25, 2002 compared
with $162.6 million at December 26, 2001.  Excluding net liabilities of
discontinued operations at December 26, 2001 and the $40.0 million
reclassification of our credit facility borrowings to current liabilities
during the three quarters ended September 25, 2002, our working capital deficit
was $106.2 million at September 25, 2002 compared with $147.5 million at
December 26, 2001.  This working capital deficit decrease of $41.3 million
resulted primarily from the use of borrowings under the credit facility to
satisfy current liabilities and the reduction of company-owned units from
refranchising activity and store closures.  We are able to operate with a
substantial working capital deficit because (1) restaurant operations and most
food service operations are conducted primarily on a cash (and cash equivalent)
basis with a low level of accounts receivable, (2)rapid turnover allows a
limited investment in inventories, and (3) accounts payable for food, beverages
and supplies usually become due after the receipt of cash from the related
sales.

Implementation of New Accounting Standards
------------------------------------------

In July 2001, the Financial Accounting Standards Board, or FASB, issued
Statement of Financial Accounting Standards No. 141, or SFAS 141, "Business
Combinations." SFAS 141 requires the purchase method of accounting for business

<PAGE>

combinations initiated after June 27, 2001 and eliminates the
pooling-of-interests method.  Our adoption of SFAS 141 has had no impact on our
financial statements.

Also in July 2001, the FASB issued SFAS 142, "Goodwill and Other Intangible
Assets," which became effective for us on December 27, 2001, the first day of
our 2002 fiscal year.  SFAS 142 requires us, among other things, to
discontinue goodwill amortization, including the amortization of reorganization
value. In addition, the standard provides for reclassifying certain intangibles
as goodwill, reassessing the useful lives of intangibles, reclassifying
certain intangibles out of previously reported goodwill and identifying
reporting units for purposes of assessing potential future impairments of
goodwill.  See Note 2 to our consolidated financial statements for a discussion
of the effects of adopting this new accounting standard.

In October 2001, the FASB issued Statement of Financial Accounting Standards
No. 144, or SFAS 144, "Accounting for the Impairment or Disposal of
Long-Lived assets," which addresses financial accounting and reporting for the
impairment or disposal of long-lived assets. SFAS 144 supersedes Statement of
Financial Accounting Standards No. 121, "Accounting for the Impairment of
Long-Lived Assets and for Long-Lived Assets to be Disposed Of," and the
accounting and reporting provisions of Accounting Principles Board Opinion
No. 30, "Reporting the Results of Operations - Reporting the Effects of
Disposal of a Segment of a Business, and Extraordinary, Unusual and
Infrequently Occurring Events and Transactions," related to the disposal of a
segment of a business.  SFAS 144 became effective for us on December 27, 2001,
the first day of our 2002 fiscal year.  Our adoption of SFAS 144 had no impact
on our financial position or results of operations.

In April 2002, the FASB issued Statement of Financial Accounting Standards
No. 145, or SFAS 145, "Rescission of FASB Statements No. 4, 44, and 64,
Amendment of FASB Statements No. 13, and  Technical Corrections."  Among other
things, SFAS 145 eliminates FASB Statement No. 4, or SFAS 4, "Reporting Gains
and Losses from Extinguishment of Debt".  Under SFAS 4, all gains and losses
from extinguishment of debt were required to be aggregated and, if material,
classified as an extraordinary item, net of any related income tax effect.  As
a result of the elimination of SFAS 4, gains and losses from extinguishment of
debt should be classified as extraordinary items only if they meet the criteria
in APB Opinion No. 30,  "Reporting the Results of Operations - Reporting the
Effects of Disposal of a Segment of a Business, and Extraordinary, Unusual and
Infrequently Occurring Events and Transactions." The provisions of SFAS 145
related to the rescission of SFAS 4 are effective for fiscal years beginning
after May 15, 2002. We have early adopted SFAS 145 in the second quarter of
2002.  See Note 1 to our consolidated financial statements for a discussion of
the effects of adopting this new accounting standard.

In June 2002, the FASB issued Statement of Financial Accounting Standards
No. 146, or SFAS 146, "Accounting for Costs Associated with Exit or Disposal
Activities."  This statement replaces Emerging Issues Task Force (EITF) Issue
No. 94-3, "Liability Recognition for Certain Employee Termination Benefits and
Other Costs to Exit an Activity (including certain costs incurred in a
Restructuring)."  Among other things, SFAS 146 requires that a liability
relating to an exit activity be recorded when incurred as opposed to the date
of a company's commitment to exit an activity.  The provisions of SFAS 146 are
effective for exit and disposal activities initiated after December 31, 2002
with earlier application encouraged.  We are currently assessing the effects of
adopting SFAS 146 on our financial position and results of operations.

Item 3.  Quantitative and Qualitative Disclosures About Market Risk

We have exposure to interest rate risk related to certain instruments entered
into for other than trading  purposes.  Specifically, borrowings under the
credit facility bear interest at a variable rate based on the prime rate or an
adjusted Eurodollar rate. A 100 basis point change in the credit facility
interest rate (approximately 5.9% at September 25, 2002) would cause the
interest expense for the remainder of 2002 to change by approximately $0.1
million.  This computation is determined by considering the impact of
hypothetical interest rates on our variable long-term debt at September 25,
2002.  However, the nature and amount of our borrowings under the credit
facility may vary as a result of future business requirements, market
conditions and other factors.

Our other outstanding long-term debt bears fixed rates of interest.  The
estimated fair value of our fixed rate long-term debt (excluding capital leases)
was approximately $408.0 million at September 25, 2002. This computation is
based on market quotations for the same or similar debt issues or the estimated
borrowing rates available to us. The difference in the estimated fair value of

<PAGE>

long-term debt compared to its historical cost reported in our consolidated
balance sheets at September 25, 2002 relates primarily to market quotations for
our 11 1/4% Notes.

We have established a policy to identify, control and manage market risks which
may arise from changes in interest rates, foreign currency exchange rates,
commodity prices and other relevant rates and prices.  We do not use
derivative instruments for trading purposes, and no interest rate or other
financial derivatives were in place at September 25, 2002.

Item 4.  Controls and Procedures

Within the 90 days prior to the date of this report, we carried out an
evaluation (under the supervision and with the participation of management,
including our President and Chief Executive Officer, Nelson J. Marchioli, and
our Senior Vice President and Chief Financial Officer, Andrew F. Green) of the
effectiveness of the design and operation of our disclosure controls and
procedures pursuant to Rule 13a-14 of the Securities Exchange Act of 1934, as
amended.  Based upon the evaluation, Messrs. Marchioli and Green each concluded
that disclosure controls and procedures are effective in timely alerting them
to material information required to be included in Denny's Corporation's
periodic SEC filing.

There have been no significant changes in our internal controls or in other
factors that could significantly affect these controls subsequent to the date
of their most recent evaluation, including any corrective actions with regard
to significant deficiencies and material weaknesses.

PART II - OTHER INFORMATION

Item 1. Legal Proceedings

On July 10, 2002 in the United States Bankruptcy Court for the District of
Delaware (the "Bankruptcy Court"), the reorganization of FRD under the United
States Bankruptcy Code was consummated pursuant to the First Amended Plan of
Reorganization (the "Plan").  The Bankruptcy Court, on June 20, 2002, had
previously approved and confirmed the Plan, the terms of which were consistent
with the terms of the stipulation and settlement agreement (the "Stipulation
and Settlement Agreement") entered into on February 19, 2002 (and approved by
the Bankruptcy Court on March 8, 2002) by and among FRD, the Official
Committee of Unsecured Creditors of FRD, Denny's Corporation (formerly
Advantica Restaurant Group, Inc), Denny's, FRI-M Corporation, Coco's and
Carrows, as previously reported in the Company's Form 10-Q for the first
quarter of 2002.  Pursuant to the Plan, FRD's unsecured creditors, who were
generally the holders of FRD's 12 1/4% senior notes, received 100% of the
reorganized equity of FRD.  See Note 9 to our consolidated financial statements
for additional information, including the July 10, 2002 disposal of FRD.

Item 3.  Default upon Senior Securities

On January 16, 2001, FRD elected not to make the interest payment (and all
subsequent interest payments) due and payable with respect to its 12.5% Senior
Notes due 2004 (the "FRD Senior  Notes").  As a result of this nonpayment, and
as a result of FRD's Chapter 11 filing on February 14, 2001, FRD was in default
under the indenture governing the FRD Senior Notes.  Therefore, the FRD Senior
Notes were included in liabilities subject to compromise in net liabilities of
discontinued operations on the accompanying December 26, 2001 consolidated
balance sheet.  FRD's bankruptcy filing operated as an automatic stay of all
collection and enforcement actions by the holders of the FRD Senior Notes with
respect to FRD's failure to make the interest payments when due.  For
additional information regarding discontinued operations and the July 10, 2002
divestiture of FRD, see Item 1. above and Note 9 to our consolidated financial
statements.

<PAGE>

Item 6.  Exhibits and Reports on Form 8-K

     a.  The following are included as exhibits to this report:

         Exhibit
         No.      Description
         ------   -----------

         10.1     Waiver and Agreement, dated as of June 17, 2002, ("Amendment
                  No. 10"), to the Credit Agreement dated January 7, 1998,
                  among Denny's, Inc., El Pollo Loco, Inc., Flagstar
                  Enterprises, Inc., Quincy's Restaurants Inc., as borrowers,
                  Advantica Restaurant Group, Inc., as guarantor, the lenders
                  named therein, and the Chase Manhattan Bank (the "Denny's
                  Credit Agreement").

         10.2     Waiver and Agreement, dated as of June 27, 2002, ("Amendment
                  No. 11"), to the Denny's Credit Agreement.

         99.1     Statement of Nelson J. Marchioli, President and Chief
                  Executive Officer of Denny's Corporation pursuant to 18
                  U.S.C. Section 1350, as adopted pursuant to Section 906 of
                  the Sarbanes-Oxley Act of 2002.

         99.2     Statement of Andrew F. Green, Senior Vice President and Chief
                  Financial Officer of Denny's Corporation, pursuant to 18
                  U.S.C. Section 1350, as adopted pursuant to Section 906 of
                  the Sarbanes-Oxley Act of 2002.

     b.  During the quarter we filed two reports on Form 8-K.  One report was
         filed on July 25, 2002 reporting (under Item 2) the disposition of FRD
         and (under Item 5) our change in name from "Advantica Restaurant
         Group, Inc." to "Denny's Corporation".  The other report was filed on
         August 12, 2002 reporting (under Item 5) our submission to
         the Securities and Exchange Commission ("SEC") of the statements under
         oath of our principal executive officer and principal financial
         officer as required by the SEC June 27, 2002 Order (File No. 4-460).
         No financial statements were required to be included with these Form
         8-K filings.

<PAGE>

                                       SIGNATURES

         Pursuant to the requirements of the Securities Exchange Act of 1934,
         the Registrant has duly caused this report to be signed on its behalf
         by the undersigned thereunto duly authorized.


                                                       DENNY'S CORPORATION




Date:    November 12, 2002                        By:  /s/ Rhonda J. Parish
                                                       ---------------------
                                                       Rhonda J. Parish
                                                       Executive Vice President,
                                                       General Counsel and
                                                       Secretary





Date:    November 12, 2002                        By:  /s/ Andrew F. Green
                                                       -------------------
                                                       Andrew F. Green
                                                       Senior Vice President and
                                                       Chief Financial Officer


<PAGE>

                                       CERTIFICATIONS

I, Nelson J. Marchioli, President and Chief Executive Officer of Denny's
Corporation, certify that:

1.       I have reviewed this quarterly report on Form 10-Q of Denny's
         Corporation,

2.       Based on my knowledge, this quarterly report does not contain any
         untrue statement of a material fact or omit to state a material fact
         necessary to make the statements made, in light of the circumstances
         under which such statements were made, not misleading with respect to
         the period covered by this quarterly report;

3.       Based on my knowledge, the financial statements, and other financial
         information included in this quarterly report, fairly present in all
         material respects the financial condition, results of operations and
         cash flows of the registrant as of, and for, the periods presented in
         this quarterly report;

4.       The registrant's other certifying officers and I are responsible for
         establishing and maintaining disclosure controls and procedures (as
         defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant
         and we have:

         a)       designed such disclosure controls and procedures to ensure
                  that material information relating to the registrant,
                  including its consolidated subsidiaries, is made known to us
                  by others within those entities, particularly during the
                  period in which this quarterly report is being prepared;

         b)       evaluated the effectiveness of the registrant's disclosure
                  controls and procedures as of a date within 90 days prior to
                  the filing date of this quarterly report (the "Evaluation
                  Date"); and

         c)       presented in this quarterly report our conclusions about the
                  effectiveness of the disclosure controls and procedures based
                  on our evaluation as of the Evaluation Date;

5.       The registrant's other certifying officers and I have disclosed, based
         on our most recent evaluation, to the registrant's auditors and the
         audit committee of registrant's board of directors (or persons
         performing the equivalent function):

         a)       all significant deficiencies in the design or operation of
                  internal controls which could adversely affect the
                  registrant's ability to record, process, summarize and report
                  financial data and have identified for the registrant's
                  auditors any material weaknesses in internal controls; and

         b)       any fraud, whether or not material, that involves management
                  or other employees who have a significant role in the
                  registrant's internal controls; and

6.       The registrant's other certifying officers and I have indicated in
         this quarterly report whether or not there were significant changes
         in internal controls or in other factors that could significantly
         affect internal controls subsequent to the date of our most recent
         evaluation, including any corrective actions with regard to
         significant deficiencies and material weaknesses.

Date:    November 12, 2002
                                                       /s/ Nelson J. Marchioli
                                                       -----------------------
                                                       Nelson J. Marchioli
                                                       President and Chief
                                                       Executive Officer

<PAGE>

                                       CERTIFICATIONS

I, Andrew F. Green, Senior Vice President and Chief Financial Officer of
Denny's Corporation, certify that:

1.       I have reviewed this quarterly report on Form 10-Q of Denny's
         Corporation,

2.       Based on my knowledge, this quarterly report does not contain any
         untrue statement of a material fact or omit to state a material fact
         necessary to make the statements made, in light of the circumstances
         under which such statements were made, not misleading with respect to
         the period covered by this quarterly report;

3.       Based on my knowledge, the financial statements and other financial
         information included in this quarterly report, fairly present in all
         material respects the financial condition, results of operations and
         cash flows of the registrant as of, and for, the periods presented in
         this quarterly report;

4.       The registrant's other certifying officers and I are responsible for
         establishing and maintaining disclosure controls and procedure (as
         defined in Exchange Act Rules 13a-14 and 15d-14)for the registrant and
         we have:

         a)       designed such disclosure controls and procedures to ensure
                  that material information relating to the registrant,
                  including its consolidated subsidiaries, is made known to us
                  by others within those entities, particularly during the
                  period in which this quarterly report is being prepared;

         b)       evaluated the effectiveness of the registrant's disclosure
                  controls and procedures as of a date within 90 days prior to
                  the filing date of this quarterly report (the "Evaluation
                  Date"); and

         c)       presented in this quarterly report our conclusions about the
                  effectiveness of the disclosure controls and procedures based
                  on our evaluation as of the Evaluation Date;

5.       The registrant's other certifying officers and I have disclosed, based
         on our most recent evaluation, to the registrant's auditors and the
         audit committee of registrant's board of directors (or persons
         performing the equivalent function):

         a)       all significant deficiencies in the design or operation of
                  internal controls which could adversely affect the
                  registrant's ability to record, process, summarize and report
                  financial data and have identified for the registrant's
                  auditors any material weaknesses in internal controls; and

         b)       any fraud, whether or not material, that involves management
                  or other employees who have a significant role in the
                  registrant's internal controls; and

6.       The registrant's other certifying officers and I have indicated in
         this quarterly report whether or not there were significant changes in
         internal controls or in other factors that could significantly affect
         internal controls subsequent to the date of our most recent evaluation,
         including any corrective actions with regard to significant
         deficiencies and material weaknesses.

Date:    November 12, 2002
                                                       /s/ Andrew F. Green
                                                       -------------------
                                                       Andrew F. Green
                                                       Senior Vice President
                                                       and Chief Financial
                                                       Officer



</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-23
<SEQUENCE>8
<FILENAME>auditorconsent.txt
<DESCRIPTION>AUDITOR OPINION
<TEXT>




                                                                   Exhibit 23.1


INDEPENDENT AUDITOR'S CONSENT

We consent to the incorporation by reference in this Registration Statement of
Denny's Corporation on Form S-4 of our report dated February 19, 2002 (March 8,
2002 as to Note 9 and March 9, 2002 as to Note 19), included and incorporated by
reference in the Annual Report on Form 10-K of Denny's Corporation for the year
ended December 26, 2001, and to the use of our report dated February 19, 2002
(March 8, 2002 as to Note 9 and March 9, 2002 as to Note 19), appearing in the
Prospectus, which is part of this Registration Statement. We also consent to the
reference to us under the heading "Experts" in such Prospectus.



DELOITTE & TOUCHE LLP
/s/ Deloitte & Touche LLP

Greenville, South Carolina
December 23, 2002




</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99
<SEQUENCE>9
<FILENAME>exhibit991.txt
<DESCRIPTION>LETTER OF TRANSMITTAL EX 99.1
<TEXT>

                                                                   Exhibit 99.1
                                                                   ------------




                               DENNY'S CORPORATION
                             DENNY'S HOLDINGS, INC.


                              LETTER OF TRANSMITTAL

                                For Tender of All
             Outstanding Unregistered 12 3/4% Senior Notes Due 2007
                  for Registered 12 3/4% Senior Notes Due 2007

                 Pursuant to the Prospectus Dated ________, 200_


--------------------------------------------------------------------------------
    THE EXCHANGE OFFER WILL EXPIRE AT 5:00 P.M., NEW YORK CITY TIME, ON ______,
    2003, UNLESS EXTENDED (THE  "EXPIRATION DATE"). TENDERS MAY BE WITHDRAWN
    PRIOR TO 5:00 P.M., NEW YORK CITY TIME, ON THE EXPIRATION DATE.
--------------------------------------------------------------------------------


                 PLEASE READ THE ATTACHED INSTRUCTIONS CAREFULLY

         If you want to accept the Exchange Offer, this Letter of Transmittal
must be completed, signed and timely submitted to U.S. Bank National Association
(the "Exchange Agent") as follows:

         By Mail or Hand Delivery:  U.S. Bank National Association
                                    180 East 5th Street
                                    St. Paul, Minnesota 55101
                                    Attn.: Specialized Finance Department

         Facsimile Transmission:    (651) 244-1537
         Confirm by Telephone:      (800) 934-6802

         Delivery of this Letter of Transmittal to an address other than as set
forth above or transmission via a facsimile number other than as set forth above
will not constitute a valid delivery.

         For any questions regarding this Letter of Transmittal or for any
additional information, you may contact the Exchange Agent by telephone at (651)
244-0721.

         This Exchange Offer is not being made to, nor will tenders be accepted
from or on behalf of, holders of outstanding unregistered 12 3/4% Senior Notes
Due 2007 in any jurisdiction in which the making or acceptance of this Exchange
Offer would not be in compliance with the laws of such jurisdiction.


<PAGE>


                               General Information

         The Prospectus dated ________, 200_ (the "Prospectus") of Denny's
Corporation and Denny's Holdings, Inc. (collectively, the "Issuers") and this
Letter of Transmittal (the "Letter of Transmittal") together constitute the
Issuers' offer to exchange (the "Exchange Offer") their outstanding unregistered
12 3/4% Senior Notes Due 2007 (the "Old Notes") for new 12 3/4% Senior Notes Due
2007 that are registered under the Securities Act of 1933, as amended (the "New
Notes"). For each Old Note accepted for exchange, the holder of such Old Note
will receive a New Note having a principal amount equal to that of the
surrendered Old Note; provided, however, tenders of Old Notes must be in a
minimum principal amount of $1,000 or an integral multiple of $1,000 in excess
thereof. Capitalized terms used but not defined herein have the meanings
ascribed to them in the Prospectus.

         The form and terms of the New Notes will be identical in all material
respects to the form and terms of the Old Notes except that (i) the New Notes
will be registered under the Securities Act and, therefore, the New Notes will
not bear legends restricting their transfer, and (ii) holders of the New Notes
will not be entitled to certain rights under the note exchange and registration
rights agreement (the "Exchange and Registration Rights Agreement") that each
holder entered into with the Issuers. Holders whose Old Notes are accepted for
exchange will not receive any interest accrued on the Old Notes at the time of
the exchange. See "The Exchange Offer--Interest on the New Notes" in the
Prospectus.

         This Letter of Transmittal is to be completed by all holders of Old
Notes wishing to participate in the Exchange Offer. This Letter of Transmittal,
together with the certificates representing the Old Notes, are to be forwarded
directly to U.S. Bank National Association (the "Exchange Agent").

         The Issuers reserve the right, at any time and from time to time, to
extend the Exchange Offer, in which case the term "Expiration Date" means the
latest date and time to which the Exchange Offer is extended. In order to extend
the Exchange Offer, the Issuers will notify the Exchange Agent by oral or
written notice and will issue a press release or other public announcement of
such extension, each prior to 9:00 a.m., New York City time, on the next
business day after the previously scheduled expiration date. The Exchange Offer
is not conditioned upon any minimum aggregate principal amount of Old Notes
being tendered or accepted for exchange. However, the Exchange Offer is subject
to certain conditions. See "The Exchange Offer -- Conditions of the Exchange
Offer" in the Prospectus.

         Holders who wish to tender their Old Notes but who cannot, prior to
5:00 p.m., New York City time, on the Expiration Date deliver their Old Notes,
this Letter of Transmittal or any other required documents to the Exchange Agent
may effect a tender of Old Notes by complying with the guaranteed delivery
procedures set forth in Instruction 1 attached to this Letter of Transmittal.

         Holders of OLD Notes should CAREFULLY READ THE REMAINDER OF THIS LETTER
OF TRANSMITTAL, complete the appropriate boxes below and sign this Letter of
Transmittal to indicate the action the holders elect to take with respect to the
Exchange Offer.

                                       2

<PAGE>


                               Tender of Old Notes

Ladies and Gentlemen:

         The undersigned hereby acknowledges receipt of the Prospectus dated
______, 200_. Upon the terms and subject to the conditions of the Exchange
Offer, the undersigned hereby tenders to the Issuers the Old Notes described in
Box I (Description of Tendered Notes) (the "Tendered Notes"). The undersigned is
the registered owner of all the Tendered Notes, and the undersigned represents
that, to the extent it is not the beneficial owner of the Tendered Notes, it has
received from each beneficial owner of the Tendered Notes (a "Beneficial Owner")
a duly completed and executed form of "Instructions to Registered Holder from
Beneficial Owner" accompanying this Letter of Transmittal, instructing the
undersigned to take the action described in this Letter of Transmittal. Subject
to, and effective upon, the acceptance for exchange of the Tendered Notes, the
undersigned hereby sells, assigns and transfers to, or upon the order of, the
Issuers all right, title and interest in and to the Tendered Notes.

         The undersigned hereby irrevocably constitutes and appoints the
Exchange Agent its agent and attorney-in-fact (with full knowledge that the
Exchange Agent also acts as the agent of the Issuers) with respect to the
Tendered Notes with the full power of substitution to (i) deliver certificates
for the Tendered Notes to the Issuers and deliver all accompanying evidences of
transfer and authenticity to, or upon the order of, the Issuers, (ii) present
the Tendered Notes for transfer on the books of the Issuers and (iii) receive
for the account of the Issuers all benefits and otherwise exercise all rights of
beneficial ownership of the Tendered Notes, all in accordance with the terms of
the Exchange Offer. The power of attorney granted in this paragraph shall be an
irrevocable power coupled with an interest.

         The undersigned hereby represents and warrants that the undersigned has
full power and authority to surrender, tender, sell, assign and transfer the
Tendered Notes and that the Issuers will acquire good and unencumbered title to
the Tendered Notes, free and clear of all security interests, liens,
restrictions, charges, encumbrances, conditional sale agreements or other
obligations relating to their sale and transfer and not subject to any adverse
claim when the same are accepted by the Issuers. The undersigned further
represents and warrants to the Issuers that (i) the information set forth in Box
II (Beneficial Owner(s)) is correct, (ii) any New Notes to be received by the
undersigned and any Beneficial Owner in exchange for the Tendered Notes will be
acquired in the ordinary course of business and for investment purposes of the
undersigned and such Beneficial Owner, (iii) neither the undersigned nor any
Beneficial Owner is engaged in or intends to engage in and has no arrangement or
understanding with any person to participate in a distribution (within the
meaning of the Securities Act of 1933, as amended (the "Securities Act")) of the
New Notes; (iv) neither the undersigned nor any Beneficial Owner is a
broker-dealer who purchased the Tendered Notes directly from the Issuers for
resale pursuant to Ruled 144A or any other available exemption under the
Securities Act, and (v) neither the undersigned nor any Beneficial Owner is an
"affiliate" of the Issuers within the meaning of Rule 405 under the Securities
Act.

         The undersigned agrees that acceptance of any Tendered Notes by the
Issuers and the issuance of New Notes in exchange therefor will constitute
performance in full by the Issuers of their obligations under the Exchange and
Registration Rights Agreement and that the Issuers will have no further
obligations or liabilities thereunder, except as expressly provided therein.

         The undersigned and each Beneficial Owner also acknowledge as follows:
The Exchange Offer is being made in reliance on existing interpretations of the
Securities Act by the staff of the Securities and Exchange Commission (the
"Commission") set forth in several "no-action" letters to third parties and
unrelated to the Issuers and the Exchange Offer and, based on such
interpretations, the Issuers believe that the New Notes may be offered for
resale, resold and otherwise transferred by the holders thereof (other than any
such holder which is an "affiliate" of the Issuers within the meaning of Rule
405 under the Securities Act) without further compliance with the registration
and prospectus delivery provisions of the Securities Act; provided that such New
Notes are acquired in the ordinary course of such holders' business for
investment purposes and such holders are not engaged in and do not intend to
engage in and have no arrangement or understanding with any person to
participate in the distribution (within the meaning of the Securities Act) of
such New Notes. Any holder that is an affiliate of the Issuers or that intends
to


                                       3

<PAGE>

participate in the Exchange Offer for the purpose of distributing the New
Notes (i) will not be able to rely on the interpretation by the staff of the
Commission set forth in the above-mentioned "no action" letters, (ii) will not
be able to tender its Old Notes in the Exchange Offer and (iii) must comply with
the registration and prospectus delivery requirements of the Securities Act in
connection with any sale or transfer transaction unless such sale or transfer is
made pursuant to an exemption from such requirements. Failure to comply with
such requirements may result in such holder incurring liability under the
Securities Act for which the holder is not indemnified by the Issuers. The
undersigned and each Beneficial Owner acknowledge that the Issuers have not
sought or received their own "no action" letter with respect to the Exchange
Offer, and that there can be no assurance that if the Issuers did seek its own
"no-action" letter, that the staff of the Commission would make a similar
determination with respect to this Exchange Offer.

         The undersigned further acknowledges that the Issuers may rely upon
each of the foregoing representations and covenants for purposes of the Exchange
Offer.

         The undersigned and each Beneficial Owner will, upon request, execute
and deliver any additional documents deemed by the Issuers or the Exchange Agent
to be necessary or desirable to complete the sale, assignment and transfer of
the Tendered Notes. All authority conferred or agreed to be conferred in this
Letter of Transmittal and every obligation of the undersigned and each
Beneficial Owner hereunder shall be binding upon the successors, assigns, heirs,
executors, administrators, trustees in bankruptcy and legal representatives of
the undersigned and such Beneficial Owner, and shall not be affected by, and
shall survive the death or incapacity of, the undersigned and such Beneficial
Owner.

         For purposes of the Exchange Offer, the Issuers shall be deemed to have
accepted validly tendered Old Notes when, as and if the Issuers have given
written notice thereof to the Exchange Agent.

         The undersigned understands that tenders of the Old Notes pursuant to
the procedures described in the Prospectus under "The Exchange Offer --
Procedures for Tendering" and in the Instructions in this Letter of Transmittal
will constitute a binding agreement between the undersigned and the Issuers in
accordance with the terms and subject to the conditions set forth herein and in
the Prospectus. The undersigned recognizes that under certain circumstances set
forth in the Prospectus under "The Exchange Offer -- Conditions of the Exchange
Offer" the Issuers will not be required to accept the Tendered Notes for
exchange. In addition, the undersigned understands that the undersigned may
withdraw its tender of Old Notes only as set forth in the Prospectus under "The
Exchange Offer -- Withdrawal of Tenders." Tendered Notes not accepted for
exchange or that have been withdrawn will be returned, without expense, to the
undersigned as promptly as practicable after the Expiration Date, in the manner
set forth in the next succeeding paragraph.

         Unless otherwise indicated in Box IV (Special Issuance Instructions),
certificates for the New Notes (and, if applicable, substitute certificates
representing any Old Notes not exchanged) should be issued in the name of the
undersigned. Similarly, unless otherwise indicated in Box V (Special Delivery
Instructions), certificates for the New Notes (and, if applicable, substitute
certificates representing Old Notes not exchanged) should be sent to the
undersigned at the address indicated in Box I (Description of Tendered Notes).



                                       4
<PAGE>


PLEASE READ THIS ENTIRE LETTER OF TRANSMITTAL CAREFULLY BEFORE COMPLETING
ANY BOX BELOW.

<TABLE>
<CAPTION>

-----------------------------------------------------------------------------------------------------------------------------------

                                                             BOX I
                                                DESCRIPTION OF TENDERED NOTES*



                                                                               Aggregate
                                                                            Principal Amount                 Aggregate
          Name(s) and Address(es) of Old                  Certificate        Represented by                  Principal
          Note Holder(s), exactly as name(s)              Number(s)            Principal                       Amount
          appear(s) on Old Note Certificate(s)           of Old Notes        Certificate(s)                   Tendered**
          <C>                                            <C>                <C>                              <C>







                                                                Total

</TABLE>


*        List the Old Notes to which this Letter of Transmittal relates. If the
         space provided is inadequate, the certificate numbers and principal
         amount of Old Notes should be listed on a separate signed schedule
         attached hereto.
**       Tenders of Old Notes must be in a minimum principal amount of $1,000 or
         an integral multiple of $1,000 in excess thereof. Unless otherwise
         indicated in this column, a holder will be deemed to have tendered ALL
         of the Old Notes represented by the certificate(s) set forth above. See
         Instruction 2.

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

<TABLE>
                                       BOX II
                                 BENEFICIAL OWNER(S)

    State of Principal Residence of                    Principal Amount of Tendered Notes Held
    Each Beneficial Owner of Tendered Notes            for Account of Beneficial Owner
    <C>                                                <C>

</TABLE>
--------------------------------------------------------------------------------

                                       5

<PAGE>



-------------------------------------------------------------------------------

                                    BOX III
                               METHOD OF DELIVERY
                               (See Instruction 1)

|_|      CHECK HERE IF TENDERED NOTES ARE BEING DELIVERED HEREWITH.

|_|      CHECK HERE IF TENDERED NOTES ARE BEING DELIVERED PURSUANT TO A NOTICE
         OF GUARANTEED DELIVERY PREVIOUSLY SENT TO THE EXCHANGE AGENT AND
         COMPLETE THE FOLLOWING:
         Name(s) of Registered Holder(s)----------------------------------

         Window Ticket Number (if any)------------------------------------

         Date of Execution of Notice of Guaranteed Delivery---------------

         Name of Institution which guaranteed delivery--------------------


-------------------------------------------------------------------------------

-------------------------------------------------------------------------------

                                     BOX IV
                          SPECIAL ISSUANCE INSTRUCTIONS
                           (See Instructions 3 and 4)

         To be completed ONLY if certificates for New Notes and/or certificates
for Old Notes not exchanged are to be issued in the name of someone other than
the person(s) whose signature(s) appear(s) on this Letter of Transmittal in Box
VI (Signature).

Issue:   New Notes issued and/or Old Notes not exchanged to:

Name(s)-------------------------------------------------------------------
                             (Please Type or Print)

       -------------------------------------------------------------------
                             (Please Type or Print)

Address(es)---------------------------------------------------------------

           ---------------------------------------------------------------
                                  (Zip Code)

Taxpayer Identification Number or Social Security Number------------------

-------------------------------------------------------------------------------


                                       6

<PAGE>



-------------------------------------------------------------------------------

                                      BOX V
                          SPECIAL DELIVERY INSTRUCTIONS
                           (See Instructions 3 and 4)

         To be completed ONLY if certificates for New Notes and/or certificates
for Old Notes not exchanged are to be sent to someone other than the person(s)
whose signature(s) appear(s) on this Letter of Transmittal in Box VI (Signature)
at the address(es) indicated in Box I (Description of Tendered Notes).

Send:    New Notes and/or Old Notes not exchanged to:

Name(s)------------------------------------------------------------------
                             (Please Type or Print)

       ------------------------------------------------------------------
                             (Please Type or Print)


Address(es)--------------------------------------------------------------

           --------------------------------------------------------------
                                    (Zip Code)

-------------------------------------------------------------------------------

                                       7

<PAGE>

-------------------------------------------------------------------------------

                                     BOX VI
               SIGNATURE: TO BE COMPLETED BY ALL TENDERING HOLDERS
                           (See Instructions 1 and 3)
            In addition, Substitute Form W-9 on the following page must be
completed and signed.

                                                                        , 200__
         --------------------------               ----------------------

                                                                        , 200__
         --------------------------               -----------------------

                                                                        , 200__
         --------------------------               -----------------------
   Signature(s) by Tendering Holder(s)                     Date

Area Code and Telephone Number-------------------------------------------

         For any Tendered Notes, this Letter of Transmittal must be signed by
the registered holder(s) as the name(s) appear(s) on the certificate(s) for the
Tendered Notes or by any person(s) authorized to become registered holder(s) by
endorsements and documents submitted herewith. If signature is by a trustee,
executor, administrator, guardian, attorney-in-fact, officer of a corporation or
other person acting in a fiduciary or representative capacity, please set forth
full title and the other information indicated below and, unless waived by the
Issuers, submit herewith evidence satisfactory to the Issuers of authority to so
act. See Instruction 3.

Name(s)------------------------------------------------------------------

       ------------------------------------------------------------------
                             (Please Type or Print)

Capacity-----------------------------------------------------------------

Address(es)--------------------------------------------------------------

           --------------------------------------------------------------
                              (Including Zip Code)

Area Code and Telephone Number-------------------------------------------

Tax Identification Number or Social Security Number----------------------

                               SIGNATURE GUARANTEE
                         (if required by Instruction 3)

Signature(s) Guaranteed by
an Eligible Institution         -----------------------------------------
                                          (Authorized Name)

                                -----------------------------------------
                                             (Print Name)

                                -----------------------------------------
                                               (Title)

                                -----------------------------------------
                                   (Name of Firm -- Must be an Eligible
                                   Institution as defined in Instruction 3)

                                -----------------------------------------
                                               (Address)

                                -----------------------------------------
                                     (Area Code and Telephone Number)

-------------------------------------------------------------------------------

                                       8

<PAGE>

-------------------------------------------------------------------------------

                       PAYORS' NAMES: DENNY'S CORPORATION
                                      HOLDINGS, INC.*

                              Name (if joint names, list first and circle the
                              name of the person or entity whose number you
                              enter in Part 1 below. See instructions if your
                              name has changed).

                              --------------------------------------------
                              Address

                              --------------------------------------------

SUBSTITUTE                    City, State and ZIP Code

 Form W-9                     --------------------------------------------


                              List account number(s) here (optional)

                              --------------------------------------------


Department of the Treasury    Part 1--PLEASE PROVIDE YOUR      Social Security
                              TAXPAYER IDENTIFICATION          or TIN
Number Internal Revenue       NUMBER ("TIN") IN THE BOX
Service                       AT RIGHT AND CERTIFY BY
                              SIGNING AND DATING BELOW.


                              --------------------------------------------

                              Part 2--Check the box if you are NOT subject to
                              backup  withholding under the provisions of
                              section  3406(a)(1)(C) of the Internal Revenue
                              Code because (1) you have not been notified  that
                              you are subject to backup withholding as a result
                              of failure to report all interest or dividends or
                              (2) the Internal Revenue Service has notified you
                              that you are no longer subject to backup
                              withholding. |_|

                              --------------------------------------------

                              Part 3--CERTIFICATION--UNDER THE PENALTIES OR
                              PERJURY, I CERTIFY THAT THE INFORMATION PROVIDED
                              ON THIS FORM IS TRUE, CORRECT AND COMPLETE.
                              Awaiting TIN |_|

                              SIGNATURE                       DATE
                                       -------------------         -------


*See Instruction 5.

-------------------------------------------------------------------------------


Note:    FAILURE TO COMPLETE AND RETURN THIS FORM MAY RESULT IN BACKUP
----     WITHHOLDING ON ANY PAYMENTS MADE TO YOU PURSUANT TO THE EXCHANGE OFFER.
         PLEASE REVIEW THE ENCLOSED GUIDELINES FOR CERTIFICATION OF TAXPAYER
         IDENTIFICATION NUMBER ON SUBSTITUTE FORM W-9 FOR ADDITIONAL DETAILS.

-------------------------------------------------------------------------------

YOU MUST COMPLETE THE FOLLOWING CERTIFICATE IF YOU CHECKED THE BOX IN PART 3 OF
SUBSTITUTE FORM W-9 ABOVE.



          CERTIFICATE OF TAXPAYER AWAITING TAXPAYER IDENTIFICATION NUMBER

I certify under penalties of perjury that a taxpayer identification number has
not been issued to me, and either (i) I have mailed or delivered an application
to receive a taxpayer identification number to the appropriate Internal Revenue
Service Center or Social Security Administration office or (ii) I intend to mail
or deliver an application in the near future. I understand that if I do not
provide a taxpayer identification number to the payor, a portion of payments
made to me pursuant to the Exchange Offer shall be retained until I provide a
taxpayer identification number to the payor and that, if I do not provide my
taxpayer identification number within sixty (60) days, such retained amounts
shall be remitted to the Internal Revenue Service as a backup withholding and
all reportable payments made to me thereafter will be subject to backup
withholding until I provide a number.


SIGNATURE                                                  DATE
         --------------------------------------------           ----------

-------------------------------------------------------------------------------
                                       9

<PAGE>


                               DENNY'S CORPORATION
                             DENNY'S HOLDINGS, INC.

                      INSTRUCTIONS TO LETTER OF TRANSMITTAL
                    FORMING PART OF THE TERMS AND CONDITIONS
                              OF THE EXCHANGE OFFER

         1. Delivery of this Letter of Transmittal and Tendered Notes;
Guaranteed  Delivery  Procedures. This Letter of Transmittal is to be completed
by all holders of Old Notes wishing to participate in the Exchange Offer.

         A properly completed and duly executed Letter of Transmittal (or
manually signed facsimile hereof), certificates representing the Old Notes
tendered and all other documents required by this Letter of Transmittal must be
received by the Exchange Agent at the address set forth on the front cover and
back cover hereof prior to 5:00 p.m., New York City time, on the Expiration
Date, or the tendering holder must comply with the guaranteed delivery
procedures set forth below.

         Holders who wish to tender their Old Notes but who cannot, prior to
5:00 p.m., New York City time, on the Expiration Date deliver their Old Notes,
this Letter of Transmittal or any other documents required by this Letter of
Transmittal to the Exchange Agent may effect a tender of Old Notes by complying
with the guaranteed delivery procedures set forth in the instructions to the
Notice of Guaranteed Delivery accompanying this Letter of Transmittal. Pursuant
to such procedures, (a) the tender must be made through an Eligible Institution
(as defined in Instruction 3); (b) prior to 5:00 p.m., New York City time, on
the Expiration Date, the Exchange Agent must have received from such Eligible
Institution a properly completed and duly executed Notice of Guaranteed Delivery
(by facsimile transmission, registered or certified mail or hand delivery)
setting forth the name and address of the tendering holder, the certificate
number(s) of the Tendered Notes and the principal amount of the Tendered Notes,
stating that the tender is being made thereby and guaranteeing that, within
three New York Stock Exchange trading days after the Expiration Date, the
certificates(s) representing the Tendered Notes and this Letter of Transmittal
(or a facsimile thereof), and any other documents required by this Letter of
Transmittal will be deposited by the Eligible Institution with the Exchange
Agent; and (c) the certificates(s) representing the Tendered Notes in proper
form for transfer and this Letter of Transmittal (or a facsimile thereof), and
all other documents required by this Letter of Transmittal are received by the
Exchange Agent within three New York Stock Exchange trading days after the
Expiration Date.

         The method of delivery of this Letter of Transmittal, the Tendered
Notes and all other required documents is at the election and risk of the
tendering holders. The delivery will be deemed made only when actually received
or confirmed by the Exchange Agent. As an alternative to delivery by mail,
holders may wish to consider overnight or hand delivery service. In all cases,
sufficient time should be allowed to assure delivery to the Exchange Agent prior
to 5:00 p.m., New York City time, on the Expiration Date.

         See the discussion set forth under "The Exchange Offer" in the
Prospectus.

         2. Tender by Registered Holder; Instructions to Beneficial Holders;
Partial Tenders. Only a holder in whose name Old Notes are registered may
execute and deliver this Letter of Transmittal and tender Old Notes in the
Exchange Offer. Any beneficial owner whose Old Notes are registered in the name
of a broker, dealer, commercial bank, trust, company or other nominee and who
wishes to tender such Old Notes should (i) contact such registered holder
promptly and instruct such registered holder to tender Old Notes on such
beneficial owner's behalf, (ii) properly complete and duly execute the form of
"Instructions to Registered Holder From Beneficial Owner" accompanying this
Letter of Transmittal and (iii) timely deliver the form to such registered
holder. The Issuers, the Exchange Agent and the transfer and registrar for the
Old Notes shall be entitled to rely upon all representations, warranties,
covenants and instructions given or made by such registered holder and/or such
beneficial owner. If such beneficial owner wishes to tender Old Notes on its own
behalf, such beneficial owner must, prior to completing and executing this
Letter of Transmittal and delivering its Old Notes, either make appropriate
arrangements to

                                       10

<PAGE>

register ownership of the Old Notes in such beneficial owner's name or obtain a
properly completed bond power from the registered holder. Any such transfer of
registered ownership may take considerable time.

         Tendered Notes must be in a minimum principal amount of $1,000 or an
integral multiple of $1,000 in excess thereof. If less than the entire principal
amount of the Old Notes evidenced by a submitted certificate are to be tendered,
the tendering holder(s) should indicate the aggregate principal amount of
Tendered Notes in Box I (Description of Tendered Notes) under the caption
"Aggregate Principal Amount Tendered." The entire principal amount of Old Notes
delivered to the Exchange Agent will be deemed to have been tendered unless
otherwise indicated. If the entire principal amount of Old Notes is not tendered
for exchange, then (i) unless otherwise indicated in Box IV (Special Issuance
Instructions), certificates evidencing New Notes and untendered Old Notes will
be issued in the name of the person signing this Letter of Transmittal and (ii)
unless otherwise indicated in Box V (Special Delivery Instructions), such
certificates will be sent to the person signing this Letter of Transmittal at
the address indicated in Box I (Description of Tendered Notes).

         3. Signatures on this Letter of Transmittal; Bond Powers and
Endorsements; Guarantee of Signatures. If this Letter of Transmittal is signed
by the registered holder of the Tendered Notes, the signature must correspond
exactly with the name(s) as written on the face of the certificates for the
Tendered Notes without any change whatsoever. If any Old Notes that are tendered
are owned of record by two or more joint owners, all owners must sign this
Letter of Transmittal. If any Tendered Notes are registered in different names
on several certificates, the holders must complete, sign and submit as many
separate copies of this Letter of Transmittal as there are different
registrations of certificates.

         When this Letter of Transmittal is signed by the registered holder(s)
of the Tendered Notes and tendered hereby, no endorsements of certificates or
separate bond powers are required. If, however, the New Notes are to be issued
or any untendered Old Notes are to be reissued to a person other than the
registered holder, then endorsements of any certificates transmitted hereby or
separate bond powers are required. Signatures on such certificate(s) must be
guaranteed by an Eligible Institution (as defined below).

         If this Letter of Transmittal is signed by a person other than the
registered holder(s) of any certificate(s) specified herein, such certificate(s)
must be endorsed or accompanied by appropriate bond powers, in either case
signed exactly as the name(s) of the registered holder(s) appear(s) on the
certificate(s) and signatures on each such endorsement or bond power must be
guaranteed by an Eligible Institution.

         If this Letter of Transmittal or any certificates or bond powers are
signed by trustees, executors, administrators, guardians, attorneys-in-fact,
officers of corporations or others acting in a fiduciary or representative
capacity, such persons should so indicate when signing, and, unless waived by
the Issuers, evidence satisfactory to the Issuers of their authority to so act
must be submitted with this Letter of Transmittal.

         Endorsements on certificates for Tendered Notes or signatures on bond
powers required by this Instruction 3 must be guaranteed by a firm that is a
member of a registered national securities exchange or of the National
Association of Securities Dealers, Inc., or is a savings institution, commercial
bank or trust company having an office or correspondent in the United States, or
is otherwise an "eligible guarantor institution" within the meaning of Rule
17Ad-15 under the Securities Exchange Act of 1934, as amended, and which is, in
each case, a member of a recognized signature guarantee program (i.e.,
Securities Transfer Agents Medallion Program, Stock Exchange Medallion Program
or New York Stock Exchange Medallion Signature Program) (an "Eligible
Institution").

         Signatures on this Letter of Transmittal need not be guaranteed by an
Eligible Institution if the Old Notes are tendered by: (i) the registered holder
thereof who has not completed Box IV (Special Issuance Instructions) or Box V
(Special Delivery Instructions) on this Letter of Transmittal or (ii) an
Eligible Institution.

         4. Special Issuance and Delivery Instructions. Tendering holders should
indicate in the applicable boxes the name and address to which New Notes issued
pursuant to the Exchange Offer and/or

                                       11

<PAGE>

substitute certificates evidencing untendered Old Notes are to be issued or
sent if different from the name or address of the holder signing this Letter of
Transmittal. In the case of issuance in a different name, the taxpayer
identification number or social security number of the person named must also
be indicated. If no such instructions are given, certificates evidencing New
Notes and untendered Old Notes will be returned to the person signing this
Letter of Transmittal at the address indicated in Box I (Description of
Tendered Notes).

         5. Tax Identification Number. Federal income tax law requires a holder
whose Old Notes are accepted for exchange to provide the Issuers as payors with
a Substitute Form W-9, which contains, among other things, the holder's Taxpayer
Identification Number ("TIN"). In the case of an individual the TIN is his or
her social security number, and in the case of an entity the TIN is typically
the employer identification number. If the holder is a nonresident alien or a
foreign entity not subject to backup withholding, the holder must furnish the
Issuers with a Form W-8, Certificate of Foreign Status in order to avoid backup
withholding. If the holder does not furnish the Issuers a Substitute Form W-9
(with a valid TIN), or other documentation establishing that the holder is
eligible for an exemption from backup withholding, the holder will be subject to
backup withholding upon the delivery of the New Notes and receipt of any
reportable payments made by the Issuers after the exchange. In addition, failure
to furnish the Substitute Form W-9, or other documentation establishing an
exemption from backup withholding, may subject the holder to penalties.

         If a holder otherwise subject to backup withholding does not have a
TIN, it should consult its tax advisor and apply for a TIN. If such a holder
does not apply for a TIN, it will be subject to backup withholding under the
rules outlined above. If the holder has applied for a TIN or intends to do so in
the near future, the holder should indicate that it has "applied for" a TIN on
the Substitute Form W-9. If the holder fails to furnish the Issuers with a TIN
within 60 days of filing the Substitute Form W-9, the Issuers will apply backup
withholding to all payments due to the holder.

         6. Transfer Taxes. The Issuers will pay all transfer taxes, if any,
applicable to the transfer of Old Notes to it or its order pursuant to the
Exchange Offer. If, however, New Notes and/or substitute notes for untendered
Old Notes are to be delivered to, or are to be registered or issued in the name
of, any person other than the registered holder of the Old Notes, or if the Old
Notes are registered in the name of any person other than the person signing
this Letter of Transmittal, or if a transfer tax is imposed for any reason other
than the transfer of Old Notes to the Issuers or their order pursuant to the
Exchange Offer, the amount of any such transfer taxes (whether imposed on the
registered holder or any other persons) will be payable by the tendering holder.
If satisfactory evidence of payment of such taxes or exemption therefrom is not
submitted herewith, the amount of such transfer taxes will be billed directly to
such tendering holder.

         Except as provided in this Instruction 6, it will not be necessary for
transfer tax stamps to be affixed to Old Notes that are tendered.

         7. Waiver of Conditions.  The Issuers  reserve the absolute right
to amend,  waive or modify any or all conditions relating to the Exchange Offer
set forth in the Prospectus.

         8. No Conditional  Tenders.  No alternative, conditional,
irregular or contingent tenders will be accepted.  All holders of Old Notes,
by execution of this Letter of  Transmittal,  shall waive any right to receive
notice of the acceptance of their Old Notes for exchange.

         9. Mutilated, Lost, Stolen or Destroyed Old Notes. Any holder whose Old
Notes have been mutilated, lost, stolen or destroyed should contact the Exchange
Agent at the address set forth on the front cover and back cover hereof for
further instructions.

         10. Validity of Tenders. All questions as to the validity, form,
eligibility (including time of receipt), acceptance and withdrawal of Tendered
Notes will be determined by the Issuers in their sole discretion, which
determination will be final and binding. The Issuers reserve the absolute right
to reject any and all Old Notes not properly tendered or any Old Notes the
acceptance of which would, in the opinion of counsel for the Issuers, be
unlawful. The Issuers also reserve the right in their sole discretion to

                                       12

<PAGE>

waive any defects, irregularities or conditions of tender as to any Old Notes.
The Issuers' interpretation of the terms and conditions of the Exchange Offer
(including the Instructions in this Letter of Transmittal) will be final and
binding on all parties. Unless waived, any defects or irregularities in
connection with Tendered Notes must be cured within such time as the Issuers
shall determine. Although the Issuers intend to notify holders of defects or
irregularities with respect to tenders of Old Notes, neither the Issuers, the
Exchange Agent nor any other person shall incur any liability for failure to
give such notification. Tenders of Old Notes will not be deemed to have been
made until such defects or irregularities have been cured or waived. Any Old
Notes received by the Exchange Agent that are not properly tendered and as to
which the defects or irregularities have not been cured or waived will be
returned by the Exchange Agent to the tendering holders, unless otherwise
provided in this Letter of Transmittal, as promptly as practicable following the
Expiration Date.

         11. Acceptance of Tendered Notes and Issuance of Notes; Return of
Notes. Subject to the terms and conditions of the Exchange Offer, the Issuers
will accept for exchange all validly tendered Old Notes as promptly as
practicable after the Expiration Date and will issue New Notes therefor as
promptly as practicable thereafter. For purposes of the Exchange Offer, the
Issuers shall be deemed to have accepted validly Tendered Notes when, as and if
the Issuers have given oral or written notice thereof to the Exchange Agent. If
any Tendered Notes are not accepted for exchange for any reason, such
unexchanged Tendered Notes will be returned, without expense, to the person
signing this Letter of Transmittal at the address indicated in Box I
(Description of Tendered Notes).

         12. Withdrawal.  Old Notes that are  tendered may be withdrawn
only pursuant to the procedures set forth in the Prospectus under "The Exchange
Offer -- Withdrawal of Tenders."

         13. Requests for Assistance or Additional Copies. Questions relating to
the procedures for tendering, as well as requests for additional copies of the
Prospectus, this Letter of Transmittal and the Notice of Guaranteed Delivery,
may be directed to the Exchange Agent at the address and telephone number set
forth on the front cover and back cover hereof.

                                       13


<PAGE>











                         U.S. Bank National Association,
                              as Exchange Agent


             By Mail or Hand Delivery:    U.S. Bank National Association
                                          180 East 5th Street
                                          St. Paul, Minnesota 55101
                                          Attn.: Specialized Finance Department


             Facsimile Transmission:      (651) 244-1537
             Confirm by Telephone:        (800) 934-6802





</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99
<SEQUENCE>10
<FILENAME>exhibit992.txt
<DESCRIPTION>NOTICE OF GUARANTEE OF DELIVERY EX 99.2
<TEXT>


                                                                   Exhibit 99.2

                               DENNY'S CORPORATION
                             DENNY'S HOLDINGS, INC.


                          NOTICE OF GUARANTEED DELIVERY

                          With Respect to the Tender of
             Outstanding Unregistered 12 3/4% Senior Notes Due 2007
                  for Registered 12 3/4% Senior Notes Due 2007

                  Pursuant to the Prospectus Dated ______, 200_

--------------------------------------------------------------------------------
    THE EXCHANGE OFFER WILL EXPIRE AT 5:00 P.M., NEW YORK CITY TIME, ON _______,
    2003, UNLESS EXTENDED (THE "EXPIRATION DATE"). TENDERS MAY BE WITHDRAWN
    PRIOR TO 5:00 P.M., NEW YORK CITY TIME, ON THE EXPIRATION DATE.
--------------------------------------------------------------------------------

                 PLEASE READ CAREFULLY THE ATTACHED INSTRUCTIONS

         As set forth in the Letter of Transmittal (the "Letter of Transmittal")
accompanying the Prospectus dated ________, 200_ (the "Prospectus") of Denny's
Corporation and Denny's Holdings, Inc. (collectively, the "Issuers"), this
Notice of Guaranteed Delivery or a form substantially equivalent hereto must be
used to accept Denny's offer to exchange (the "Exchange Offer") its outstanding
unregistered 12 3/4% Senior Notes Due 2007 (the "Old Notes") for registered 12
3/4% Senior Notes Due 2007 (the "New Notes") if the tendering holder of Old
Notes cannot, prior to 5:00 p.m., New York City time, on the Expiration Date
deliver its Old Notes, the Letter of Transmittal or any other documents required
by the Letter of Transmittal to the Exchange Agent (as defined below). If
required, this Notice of Guaranteed Delivery, properly completed and duly
executed, must be delivered to U.S. Bank National Association (the "Exchange
Agent") as set forth below.

         By Mail or Hand Delivery:  U.S. Bank National Association
                                    180 East 5th Street
                                    St. Paul, Minnesota 55101
                                    Attn.: Specialized Finance Department

         Facsimile Transmission:    (651) 244-1537
         Confirm by Telephone:      (800) 934-6802

         Delivery of this Notice of Guaranteed Delivery to an address other than
as set forth above or transmission via a facsimile number other than as set
forth above will not constitute a valid delivery.

         For any questions regarding this Notice of Guaranteed Delivery or for
any additional information, please contact the Exchange Agent by telephone at
(651) 244-0721.

         This form is not to be used to guarantee signatures. If a signature on
the Letter of Transmittal is required to be guaranteed by an "Eligible
Institution" under the instructions thereto, such signature guarantee must
appear in the applicable space provided in the Letter of Transmittal.


<PAGE>


Ladies and Gentlemen:

         The undersigned hereby tenders to Denny's Corporation and Denny's
Holdings, Inc. (collectively, the "Issuers"), upon the terms and subject to the
conditions set forth in the Prospectus and the Letter of Transmittal, receipt of
which is hereby acknowledged, the principal amount of outstanding unregistered
12 3/4% Senior Notes Due 2007 (the "Old Notes") set forth below pursuant to the
guaranteed delivery procedures.

         All authority herein conferred or agreed to be conferred in this Notice
of Guaranteed Delivery and every obligation of the undersigned hereunder shall
be binding upon the successors, assigns, heirs, executors, administrators,
trustees in bankruptcy and legal representatives of the undersigned and shall
not be affected by, and shall survive the death or incapacity of, the
undersigned.



                            PLEASE SIGN AND COMPLETE

Signatures of Registered Holder(s)
or Authorized Signatory                    -----------------------------------

                                           -----------------------------------

                                           -----------------------------------


Name(s) of Registered Holder(s)            -----------------------------------

                                           -----------------------------------

                                           -----------------------------------


Principal Amount of Old Notes Tendered----------------------------------------

Date--------------------------------------------------------------------------

Address-----------------------------------------------------------------------

Area Code and Telephone Number------------------------------------------------


This Notice of Guaranteed Delivery must be signed by the registered holder(s) of
the Old Notes tendered hereby exactly as their name(s) appear on the
certificates for such notes or by person(s) authorized to become registered
holder(s) of such notes by endorsements and documents submitted with this Notice
of Guaranteed Delivery. If signature is by a trustee, executor, administrator,
guardian, attorney-in-fact, officer of a corporation or other person acting in a
fiduciary or representative capacity, such person must provide the following
information and, unless waived by the Issuers, submit with the Letter of
Transmittal evidence satisfactory to the Issuers of such person's authority to
so act. See Instruction 2.


                                       2
<PAGE>




                      PLEASE PRINT NAME(S) AND ADDRESS(ES)

Name(s)
                  -------------------------------------------------------------

                  -------------------------------------------------------------

Capacity
                  -------------------------------------------------------------

Address(es)
                  -------------------------------------------------------------

                               GUARANTEE
                    (Not to be used for signature guarantee)

The undersigned, a firm that is a member of a registered national securities
exchange or of the National Association of Securities Dealers, Inc., or is a
savings institution, commercial bank or trust company having an office or
correspondent in the United States, or is otherwise an "eligible guarantor
institution" within the meaning of Rule 17Ad-15 under the Securities Exchange
Act of 1934, as amended, and which is, in each case, a member of a recognized
signature guarantee program (i.e., Securities Transfer Agents Medallion Program,
Stock Exchange Medallion Program or New York Stock Exchange Medallion Signature
Program), guarantees deposit with the Exchange Agent of the Letter of
Transmittal (or facsimile thereof), the Old Notes tendered hereby in proper form
for transfer and any other required documents, all by 5:00 p.m., New York City
time, within three New York Stock Exchange trading days after the Expiration
Date.

Name of Firm------------------------     Authorized Signature------------------

Address     ------------------------     Name----------------------------------

            ------------------------


Area Code and
Telephone Number--------------------      Title--------------------------------

                                          Date---------------------------------


         DO NOT SEND OLD NOTES WITH THIS FORM. ACTUAL SURRENDER OF OLD NOTES
MUST BE MADE PURSUANT TO, AND BE ACCOMPANIED BY, A PROPERLY COMPLETED AND DULY
EXECUTED LETTER OF TRANSMITTAL AND ANY OTHER REQUIRED DOCUMENTS.

                                       3

<PAGE>


                 INSTRUCTIONS FOR NOTICE OF GUARANTEED DELIVERY

         1.       Delivery of this Notice of Guaranteed Delivery. A properly
completed and duly executed copy of this Notice of Guaranteed Delivery and any
other documents required by this Notice of Guaranteed Delivery must be received
by the Exchange Agent at its address set forth herein prior to 5:00 p.m., New
York City time, on the Expiration Date. The method of delivery of this Notice of
Guaranteed Delivery and all other required documents is at the election and risk
of the tendering holders. The delivery will be deemed made only when actually
received or confirmed by the Exchange Agent. As an alternative to delivery by
mail, holders may wish to consider overnight or hand delivery service. In all
cases, sufficient time should be allowed to assure delivery to the Exchange
Agent prior to 5:00 p.m., New York City time, on the Expiration Date.

         2.       Signatures on this Notice of Guaranteed Delivery. If this
Notice of Guaranteed Delivery is signed by the registered holder(s) of the Old
Notes referred to herein, the signature(s) must correspond exactly with the
name(s) as written on the face of the certificates for such Old Notes without
any change whatsoever.

         If this Notice of Guaranteed Delivery is signed by a person other than
the registered holder(s) of any Old Notes, this Notice of Guaranteed Delivery
must be accompanied by appropriate bond powers, signed as the name(s) of the
registered holder(s) appear(s) on the certificates for the Old Notes.

         If this Notice of Guaranteed Delivery is signed by a trustee, executor,
administrator, guardian, attorney-in-fact, officer of a corporation or other
person acting in a fiduciary or representative capacity, such person should so
indicate when signing, and unless waived by Denny's, submit with the Letter of
Transmittal evidence satisfactory to Denny's of such person's authority to so
act.

         3.       Requests for Assistance or Additional Copies. Questions
relating to the procedures for tendering, as well as requests for additional
copies of the Prospectus, the Letter of Transmittal and this Notice of
Guaranteed Delivery, may be directed to the Exchange Agent at the address and
telephone number set forth on the front cover and back cover hereof.


                                       4

<PAGE>


                              U.S. Bank National Association,
                                      as Exchange Agent



            By Mail or Hand Delivery:     U.S. Bank National Association
                                          180 East 5th Street
                                          St. Paul, Minnesota 55101
                                          Attn.: Specialized Finance Department

            Facsimile Transmission:       (651) 244-1537
            Confirm by Telephone:         (800) 934-6802

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99
<SEQUENCE>11
<FILENAME>exhibit993.txt
<DESCRIPTION>TAXPAYER ID GUIDELINES EX 99.3
<TEXT>


                                                                   Exhibit 99.3
                                                                   ------------

               GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION
                           NUMBER ON SUBSTITUTE FORM W-9
<TABLE>
     GUIDELINES FOR DETERMINING THE PROPER IDENTIFICATION NUMBER TO GIVE THE PAYOR.  Social Security numbers have nine
digits separated by two hyphens, e.g., 000-00-0000.  Employer identification numbers have nine digits separated by only
one hyphen, e.g., 00-0000000.  The table below will help determine the number to give the payor.

                                Give the                                              Give the
For this type                   SOCIAL SECURITY           For this type               SOCIAL SECURITY
of account:                     number of -               of account:                 number of -
<C>                             <C>                       <C>                         <C>

1.   An individual's            The individual            9.   A valid trust,         The legal entity (do
     account                                                   estate, or             not furnish the
                                                               pension trust          identifying number of
                                                                                      the personal
                                                                                      representative or
                                                                                      trustee unless the
                                                                                      legal entity itself
                                                                                      is not designated in
                                                                                      the account title)(5)

2.   Two or more                The actual owner of       10.  Corporate account      The corporation
     individuals (joint         the account or, if
     account)                   combined funds, the
                                first individual on
                                the account (1)

3.   Husband and wife           The actual owner of       11.  Religious,             The organization
     (joint account)            the account or, if             charitable, or
                                joint funds, either            educational
                                person (1)                     organization

4.   Custodian account of       The minor (2)             12.  Partnership            The partnership
     a minor (Uniform Gift to                                  account held in the
     Minors Act)                                               name of the business

5.   Adult and minor            The adult or, if          13.  Association,           The organization
     (joint account)            the minor is the               club, or other
                                only contributor,              tax-exempt
                                the minor (1)                  organization

6.   Account in the name        The ward, minor, or       14.  A broker or             The broker or nominee
     of guardian or committee   incompetent person             registered nominee
     for a designated           (3)
     ward, minor, or
     incompetent person

7.   a. A revocable savings     The grantor-trustee       15.  Account with the       The public entity
        trust account (in       (1)                            Department of
        which grantor is also                                  Agriculture in the
        trustee)                                               name of a public
                                                               entity (such as a
                                                               State or local
                                                               government, school
                                                               district, or prison)
                                                               that receives
                                                               agricultural program
                                                               payments
     b. Any "trust" account     The actual owner (1)
         that
         is not a legal or
         Valid trust under
         State law

8.   Sole proprietorship        The owner (4)             .
     account

(1)  List first and circle the name of the person whose number you furnish.
(2)  Circle the minor's name and furnish the minor's social security number.
(3)  Circle the ward's, minor's or incompetent person's name and furnish such
     person's social security number.
(4)  Show the name of the owner.  If the owner does not have an employer
     identification number, furnish the owner's social security number.
(5)  List first and circle the name of the legal trust, estate or pension trust.

NOTE:    IF NO NAME IS CIRCLED WHEN THERE IS MORE THAN ONE NAME,  THE NUMBER
         WILL BE CONSIDERED TO BE THAT OF THE FIRST NAME LISTED.

</TABLE>
<PAGE>

<TABLE>

                                GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION
                                          NUMBER ON SUBSTITUTE FORM W-9
<C>                                                          <C>
 Obtaining a Number                                          o        Payments made by certain foreign organizations.
                                                             o        Payments made to a nominee.
      If you do not have a taxpayer  identification number
 or  you  do not  know  your  number,  obtain  form  SS-5,        Payments  of  interest  not  generally  subject  to backup
 Application  for  a  Social  Security  Number  Card  (for   withholding include the following:
 resident   individuals),   Form  SS-4,   Application  for
 Employer  Identification  Number (for  businesses and all   o        Payments  of interest on obligations issued by
 other  entities),  Form  W-7 for  International  Taxpayer            individuals. Note: You may be subject to backup
 Identification  Number (for alien individuals required to            withholding if (i) this interest is $600 or more,
 file  U.S.  tax  returns),  at an  office  of the  Social            (ii) the interest is paid in the course of the
 Security Administration or the Internal Revenue Service.             payor's trade or business and (iii) you have not
                                                                      provided your correct taxpayer identification number
      To complete the  Substitute  Form W-9, if you do not            to the payor.
 have a taxpayer  identification  number,  write  "Applied   o        Payments of tax-exempt interest (including
 For" in the space for the taxpayer  identification number            exempt-interest dividends under section 852).
 in Part 1,  sign and date  the  Form,  and give it to the   o        Payments described in section 6049(b)(5) to
 requester.  Generally,  you  will  then  have  60 days to            non-resident aliens.
 obtain a taxpayer  identification  number and  furnish it   o        Payments on tax-free covenant bonds under section
 to the  requester.  If the  requester  does  not  receive            1451.
 your  taxpayer  identification  number  within  60  days,   o        Payments made by certain foreign organizations.
 backup  withholding,  if applicable,  will begin and will   o        Payments made to a nominee.
 continue  until you furnish your taxpayer  identification
 number to the requester.                                    Exempt payees described above should file a Substitute
                                                             Form W-9 to avoid possible erroneous backup withholding.  FILE
 Payees Exempt from Backup Withholding Penalties             THIS FORM WITH THE PAYOR, FURNISH YOUR TAXPAYER IDENTIFICATION
                                                             NUMBER, WRITE "EXEMPT" IN PART 2, SIGN AND DATE THE FORM AND
      Payees specifically exempted from backup               RETURN IT TO THE PAYOR.
 withholding on ALL payments include the following:*
                                                                  Certain payments other than interest, dividends
 o        A corporation.                                     and patronage dividends that are not subject to information
 o        A financial institution.                           reporting are also not subject to backup withholding.
 o        An  organization  exempt from tax under section    For details, see the regulations under sections 6041, 6041A(a),
          501(a), or an individual retirement plan, or a     6045, and 6050A.
          custodial account under section 403(b)(7).
 o        The United States or any agency or                 Privacy Act Notices.  Section 6109 requires most
          instrumentality thereof.                           recipients of dividends, interest or other payments to give
 o        A State, the District of Columbia, a possession    taxpayer identification numbers to payors who must report
          of the United States, or any political             the payments to the IRS.  The IRS uses the numbers for
          subdivision or instrumentality thereof.            identification purposes and to help verify the accuracy of
 o        A foreign government or a political                your tax return.  Payors must be given the numbers whether or
          subdivision, agency or instrumentality thereof.    not recipients are required to file tax returns.  Payors must
 o        An international organization or any agency or     generally withhold the applicable rate from taxable interest,
          instrumentality thereof.                           dividends, and certain other payments to a payee who does not
 o        A registered dealer in securities or               furnish a taxpayer identification number to a payor.  Certain
          or commodities registered in the United            pentalties may also apply.
          States or a possession of the United States.
 o        A real estate investment trust.                    Penalties
 o        A common  trust  fund  operated  by a bank under
          section 584(a).                                         (1) Penalty for Failure to Furnish Taxpayer
 o        An entity registered at all times during the       Identification Number.  If you fail to furnish your taxpayer
          tax year under the Investment Company Act of       identification number to a payor, you are subject to a penalty
          1940.                                              of $50 for each such failure unless your failure is due to
 o        A foreign central bank of issue.                   reasonable cause and not to willful neglect.

 Payments of dividends and patronage dividends not                (2) Civil Penalty for False Statements With Respect to
 generally subject to backup withholding                              Withholding.
 include the following:                                       If you make a false statement with no reasonable basis which results
                                                              in no imposition of backup withholding, you are subject to a
                                                              penalty of $500.
 o        Payments to nonresident aliens subject to
          withholding under section 1441.                         (3) Criminal Penalty for Falsifying Information.  If you
 o        Payments to partnerships  not engaged in a trade   falsify  certifications or affirmations, you are subject to
          or business in the United States and which have    criminal penalties including fines and/or imprisonment.
          at least one nonresident partner.
 o        Payments of patronage dividends where the          FOR ADDITIONAL  INFORMATION CONTACT YOUR TAX CONSULTANT OR
          amount received is not paid in money.              THE INTERNAL REVENUE SERVICE.


</TABLE>
--------
 * Unless otherwise noted herein, all references below to section numbers or to
 regulations are references to the Internal Revenue Code and the regulations
 promulgated thereunder

</TEXT>
</DOCUMENT>
</SUBMISSION>
