[[Image Removed: (POPEYES LOGO)]]

                                                  July 12,       Dec. 28,
            Total Operating Restaurants as of:      2009           2008
            Domestic:
            Company-Operated                             37             55
            Franchised                                1,531          1,527
            International:
            Franchised                                  337            340

            Total                                     1,905          1,922

Our Business Strategy
Our business strategy, announced during the first quarter of 2008, capitalizes on our strengths as a highly franchised restaurant system. Even in challenging economic times, this model provides diverse and reliable earnings and cash flows, with low capital spending demands. It efficiently produces sustainable cash flows which are available to enhance shareholder value. Additionally, this model provides the ability to expand the Popeyes system more rapidly than a capital intensive company-operated restaurant model.
Our strategy is based on the four pillars below, and we continue to emphasize high quality food at compelling everyday value, speed of service, and improved restaurant profitability. We believe these proven strategies make us more competitive and better positioned for accelerated growth as the consumer environment improves.
• Build the Popeyes Brand - offer a distinctive brand and menu with clear competitive advantages.

• Run Great Restaurants - strengthen restaurant operations and improve the Popeyes guest experience by providing service as distinctive as our food.

• Strengthen Unit Economics - grow revenue and identify cost savings to improve food, labor and overhead efficiencies in the restaurants.

• Align People and Resources to Deliver Results - make investments in brand building, operational tools and people.

Management Overview of 2009 Operating Results (Second Quarter) Our second quarter of 2009 results and highlights include the following:
• Net income was $6.4 million, or $0.25 per diluted share, compared to $6.6 million, or $0.26 per diluted share, last year. Excluding the impact from non-operating other expenses (income), net income would have been $4.7 million, or $0.18 per diluted share, compared to $4.3 million, or $0.17 per diluted share last year.

• System-wide sales increased by 4.9% compared to an increase of 1.5% last year.

• Global same-store sales increased 4.3% compared to a decrease of 1.4% last year. Domestic same-store sales increased 4.3% compared to a decrease of 1.7% last year and international same-store sales increased 3.9% compared to an increase of 1.7% last year.

• The Popeyes system opened 16 new restaurants, offset by 22 permanent closings.

• We completed the re-franchising of 13 company-operated restaurants in our Atlanta, Georgia market and sold nine properties in the Texas market. The Company realized combined net proceeds of approximately $7.5 million, including $0.4 million of franchise fees which are recorded as a component of "Franchise revenues" in the condensed statement of operations. We recognized a related net gain on the sale of the assets during the quarter of $2.8 million which is recorded as a component of "Other expenses (income), net" on the condensed statement of operations.

A summary of our financial results and key operational metrics is presented below.

                                                     12 Weeks Ended                       28 Weeks Ended
(Dollars in millions)                          07/12/09          07/13/08           07/12/09           07/13/08
Sales by company-operated restaurants         $     14.1        $     18.8         $     34.9         $     45.2
Franchise revenues (a)                              20.6              19.6               46.3               45.4
Other revenues                                       1.0               0.9                2.4                2.0

Total revenues                                $     35.7        $     39.3         $     83.6         $     92.6


Operating profit                              $     11.4        $     12.9         $     21.3         $     26.2
Net income                                    $      6.4        $      6.6         $     11.4         $     13.0

Global system-wide sales increase                    4.9 %             1.5 %              2.8 %              1.5 %

Same-store sales increase (decrease) (b)
Company-operated restaurant segment                  1.8 %            (4.3 )%            (1.8 )%            (5.3 )%
Domestic franchised restaurants                      4.4 %            (1.5 )%             1.8 %             (1.6 )%

Total domestic (company-operated and
franchised restaurants)                              4.3 %            (1.7 )%             1.7 %             (1.7 )%
International franchised restaurants                 3.9 %             1.7 %              4.4 %              2.6 %

Total global system                                  4.3 %            (1.4 )%             1.9 %             (1.3 )%


Company-operated restaurants (all
domestic)
Restaurants at beginning of period                    51                64                 55                 65
New restaurant openings                                -                 1                  -                  1
Unit conversions, net                                (13 )               -                (16 )                -
Permanent closings                                    (1 )               -                 (2 )                -
Temporary (closings)/re-openings, net                  -                 2                  -                  1

Restaurants at the end of second quarter              37                67                 37                 67


Franchised restaurants (domestic and
international)
Restaurants at beginning of period                 1,858             1,825              1,867              1,840
New restaurant openings                               16                31                 30                 68
Unit conversions, net                                 13                 -                 16                  -
Permanent closings                                   (21 )             (31 )              (51 )              (64 )
Temporary (closings)/re-openings, net                  2                 9                  6                (10 )

Restaurants at the end of second quarter           1,868             1,834              1,868              1,834


Total system restaurants                           1,905             1,901              1,905              1,901

(a) Franchise revenues are principally comprised of royalty payments from franchisees that are based upon franchisee sales. While franchisee sales are not recorded as revenue by the Company, we believe they are important in understanding the Company's financial performance and overall financial health, given the Company's strategic focus on growing its overall business through franchising. For the second quarter of 2009 and 2008, franchisee sales, as reported by our franchisees, were approximately $412.2 million and $387.4 million, respectively.

(b) Same-store sales statistics exclude temporarily and permanently closed restaurants and stores that have been open for less than 65 weeks.

In reviewing our operating results, we believe the following table can be helpful. The table presents selected revenues and expenses as a percentage of total revenues (or as a percentage of a corresponding revenue line item).

                                                     12 Weeks Ended                        28 Weeks Ended
                                               07/12/09           07/13/08           07/12/09           07/13/08
Revenues:
Sales by company-operated restaurants                 39 %               48 %               42 %               49 %
Franchise revenues                                    58 %               50 %               55 %               49 %
Rent and other revenues                                3 %                2 %                3 %                2 %

Total revenues                                       100 %              100 %              100 %              100 %

Expenses:
Restaurant employee, occupancy and other
expenses (a)                                          53 %               53 %               52 %               51 %
Restaurant food, beverages and packaging
(a)                                                   33 %               35 %               33 %               35 %
Rent and other occupancy expenses                      2 %                2 %                2 %                2 %
General and administrative expenses                   37 %               29 %               37 %               30 %
Depreciation and amortization                          3 %                4 %                3 %                4 %
Other expenses (income), net                          (8 )%             (10 )%              (3 )%              (6 )%

Total expenses                                        68 %               67 %               75 %               72 %

Operating profit                                      32 %               33 %               25 %               28 %
Interest expense, net                                  4 %                5 %                3 %                5 %

Income before income taxes                            28 %               28 %               22 %               23 %
Income tax expense                                    10 %               11 %                8 %                9 %

Net income                                            18 %               17 %               14 %               14 %

(a) Expressed as a percentage of sales by company-operated restaurants.

2009 Same-Store Sales - Second Quarter
Global same-store sales increased 4.3% in the second quarter of 2009, as compared to the same period in 2008.
Domestic same-store sales increased 4.3% in the second quarter of 2009. This increase reflects positive transactions partially offset by a lower average check. During the second quarter, we promoted our famous and favorites BonafideTM bone-in chicken and tenders at compelling values. During the first week of the second quarter, we also promoted 'Popeyes Pay Day' on April 22nd. This national one-day promotion featured 8-pieces of chicken for $4.99. These promotions, which were supported by seven weeks of national media during the quarter, delivered positive guest counts and same-store sales. We remain focused on increasing traffic by offering compelling value, distinctive Louisiana food, and an improved guest experience.
Our international same-store sales increased 3.9% during the second quarter of 2009 due primarily to strong sales in Korea, Canada and U.S. military bases abroad, partially offset by negative performance in the Middle East and Latin America.

Looking Forward to the Remainder of 2009 Given its year-to-date same-store sales performance, the Company is now projecting global same-store sales for fiscal 2009 to be in the range of 0.0% to positive 2.0%, an increase from previous guidance of negative 1.0% to positive 1.0%.
Consistent with previous guidance, the Company expects its global new openings to be in the range of 90 to 110 restaurants. Due to improved restaurant performance and a favorable year-to-date restaurant closure rate, the Company now expects its closures to be 110 to 120 restaurants resulting in 0 to 30 net restaurant closings, compared to previous guidance of 140 to 160 restaurant closures and 30 to 70 net restaurant closings. Popeyes restaurant closures typically have sales significantly lower than the system average. The Company expects fiscal 2009 general and administrative expenses to be consistent with its previous guidance of 3.1% to 3.2% percent of system-wide sales, among the lowest in the restaurant industry. The Company will continue to tightly manage its general and administrative expenses and invest in key strategic initiatives, including its continued commitment to national media advertising and operations improvements which management believes are essential for the long-term growth of the brand.
The Company now expects 2009 earnings per diluted share to be $0.66 to $0.70, compared to previous guidance at the upper end of the range of $0.62 to $0.67. Comparisons of the Second Quarter for 2009 and 2008 Sales by Company-Operated Restaurants
Sales by company-operated restaurants were $14.1 million in the second quarter of 2009, a $4.7 million decrease from 2008. The decrease was primarily due to:
• a $5.0 million decrease related to the re-franchising of 27 company-operated restaurants (11 in the Atlanta market during the third quarter of 2008, three in the Nashville market during the first quarter of 2009 and 13 in the Atlanta market during the second quarter of 2009),

partially offset by:

• a $0.2 million increase due to a 1.8% increase in same-store sales in the second quarter of 2009.

After considering the effects of franchise fees and royalties, general and administrative savings, and lower depreciation and amortization, the second quarter impact of re-franchising the company-operated restaurants was favorable compared to 2008 by approximately $0.9 million. Franchise Revenues
Franchise revenues have three components: (1) ongoing royalty fees that are based on a percentage of franchisee sales; (2) franchise fees associated with new unit openings and renewals; and (3) development fees associated with the agreement pursuant to which a franchisee may develop new restaurants in a given market (usually paid at the inception of the agreement and recognized as revenue as restaurants are actually opened or the development right is terminated). Royalty fees are the largest component of franchise revenues, generally constituting more

than 90% of franchise revenues.
Franchise revenues were $20.6 million in the second quarter of 2009, a $1.0 million increase from 2008. The increase was primarily due to an increase in royalty revenue resulting from positive same-store sales and royalties from new franchised restaurants.
Rent and Other Revenues
Rent and other revenues are principally composed of rental income associated with properties leased or subleased to franchisees. Other revenues were $1.0 million in the second quarter of 2009, a $0.1 million increase from 2008. Restaurant Employee, Occupancy and Other Expenses Restaurant employee, occupancy and other expenses were $7.5 million in the second quarter of 2009, a $2.5 million decrease from 2008. This decrease was principally due to a reduction in the number of company-operated restaurants as discussed above. Restaurant employee, occupancy and other expenses were approximately 53% of sales from company-operated restaurants in both the second quarter of 2009 and 2008.
Restaurant Food, Beverages and Packaging Restaurant food, beverages and packaging costs were $4.7 million in the second quarter of 2009, a $1.9 million decrease from 2008. This decrease was principally due to a reduction in the number of company-operated restaurants as discussed above. Restaurant food, beverages and packaging costs were approximately 33% and 35% of sales from company-operated restaurants in the second quarter of 2009 and 2008, respectively. This improvement was primarily attributable to lower commodity costs and the re-franchising of company-operated restaurants.
Rent and Other Occupancy Expenses
Rent and other occupancy expenses were $0.7 million in the second quarter of 2009, a $0.2 million increase from 2008. General and Administrative Expenses
General and administrative expenses were $13.2 million in the second quarter of 2009, a $1.7 million increase from 2008. The increase was primarily due to:
• a $0.9 million net increase due to $1.4 million in national media advertising expenses, partially offset by non-recurring marketing expenses incurred during the second quarter of 2008,

• a $0.7 million increase in personnel expense, primarily related to employee incentive accruals, and

• a $0.3 million increase due to the timing of professional fees,

partially offset by:

• a $0.2 million decrease in other net general and administrative costs.

General and administrative expenses were approximately 37% and 29% of total revenues in the second quarter of 2009 and 2008, respectively. General and administrative expenses were approximately 3.1% and 2.8% of system-wide sales in the second quarter of 2009 and 2008, respectively.

Depreciation and Amortization
Depreciation and amortization was $1.1 million in the second quarter of 2009, a $0.5 million decrease from 2008. The decrease was principally due to the sale and re-franchising of 27 restaurants (11 during the third quarter of 2008, three during the first quarter of 2009 and 13 during the second of 2009). Other Expenses (Income), Net
Other expenses (income), net was $2.9 million of income in the second quarter of 2009 as compared to income of $3.8 million in the second quarter of 2008. The $2.9 million of income in 2009 resulted primarily from a net gain on sale of assets. The $3.8 million of income 2008 resulted primarily from recoveries of insurance claims, partially offset by impairment charges. A schedule of the components of other expenses (income), net can be found at Note 7 to our condensed financial statements at Part 1, Item 1 to this quarterly report. Interest Expense, Net
Interest expense, net was $1.3 million in the second quarter of 2009, a $0.6 million decrease from 2008 resulting primarily from lower average debt balances and lower average interest rates on debt as compared to 2008. A schedule of the components of interest expense, net can be found at Note 9 to our condensed financial statements included at Part 1, Item 1 to this quarterly report.
Income Tax Expense
Income tax expense was $3.7 million in the second quarter of 2009 as compared to $4.4 million in 2008. Our effective tax rate in the second quarters of 2009 and 2008 was 36.6% and 40.0% respectively. The effective tax rate differs from statutory rates due to adjustments to estimated tax reserves, non-deductible goodwill impairments, other permanent differences and inter-period allocations. Comparisons of the Twenty-Eight Weeks Ended July 12, 2009 and July 13, 2008 Sales by Company-Operated Restaurants
Sales by company-operated restaurants were $34.9 million in the twenty-eight weeks ended July 12, 2009, a $10.3 million decrease from 2008. The decrease was primarily due to:
• a $10.2 million decrease related to the re-franchising of 27 company-operated restaurants (11 in the Atlanta market during the third quarter of 2008, three in the Nashville market during the first quarter of 2009 and 13 in the Atlanta market during the second quarter of 2009), and

• a $0.6 million decrease due to a 1.8% decrease in same-store sales,

partially offset by:

• a net $0.5 million increase due to the timing of permanent and temporary restaurant closures during 2009 and 2008.

After considering the effects of franchise fees and royalties, general and administrative savings, and lower depreciation and amortization, the impact of re-franchising the company-operated restaurants was favorable to the twenty-eight weeks ended July 12, 2009 compared to 2008 by approximately $1.3 million.

Franchise Revenues
Franchise revenues were $46.3 million in the twenty-eight weeks ended July 12, 2009, a $0.9 million increase from 2008. The increase was primarily due to an increase in royalty revenue resulting from positive same-store sales and royalties from new franchised restaurants, partially offset by a decrease in franchise and development fees.
Rent and Other Revenues
Rent and other revenues were $2.4 million in the twenty-eight weeks ended July 12, 2009, a $0.4 million increase from 2008, primarily as a result of an increase in the number of leased or subleased properties, including sublease rental revenue associated with certain of the restaurants which were re-franchised.
Restaurant Employee, Occupancy and Other Expenses Restaurant employee, occupancy and other expenses were $18.3 million in the twenty-eight weeks ended July 12, 2009, a $4.9 million decrease from 2008. This decrease was principally due to a reduction in the number of company-operated restaurants as discussed above. Restaurant employee, occupancy and other expenses were approximately 52% and 51% of sales from company-operated restaurants in 2009 and 2008, respectively, increasing primarily due to additional management talent to operate our company restaurants, higher ad fund contribution levels, and higher insurance costs and other net operating costs. Restaurant Food, Beverages and Packaging Restaurant food, beverages and packaging costs were $11.6 million in the twenty-eight weeks ended July 12, 2009, a $4.2 million decrease from 2008. This decrease was principally due to a reduction in the number of company-operated restaurants as discussed above. Restaurant food, beverages and packaging costs were approximately 33% and 35% of sales from company-operated restaurants in 2009 and 2008, respectively. This improvement was primarily attributable to the re-franchising of company-operated restaurants. Rent and Other Occupancy Expenses
Rent and other occupancy expenses were $1.3 million in the twenty-eight weeks ended July 12, 2009, a $0.1 million increase from 2008. General and Administrative Expenses
General and administrative expenses were $30.9 million in the twenty-eight weeks ended July 12, 2009, a $3.3 million increase from 2008. The increase was primarily due to:
• a $1.6 million net increase due to $3.0 million in national media advertising expenses, partially offset by non-recurring marketing expenses incurred during 2008,

• a $0.9 million increase in personnel expense, primarily related to employee incentive accrual, and

• a $0.8 million increase due to other net general and administrative costs.

General and administrative expenses were approximately 37% and 30% of total revenues in the twenty-eight weeks ended July 12, 2009 and July 13, 2008, respectively. General and administrative expenses were approximately 3.2% and 2.9% of system-wide sales in the twenty-eight weeks ended July 12, 2009 and July 13, 2008, respectively.
Depreciation and Amortization
Depreciation and amortization was $2.7 million in the twenty-eight weeks ended July 12, 2009, a $1.0 million decrease from 2008. The decrease was principally due to the sale and re-franchising of 27 restaurants (11 during the third quarter of 2008, three during the first

quarter of 2009 and 13 during the second quarter of 2009). Other Expenses (Income), Net
Other expenses (income), net was $2.5 million of income in the twenty-eight weeks ended July 12, 2009, as compared to income of $5.1 million in 2008. The $2.5 million of income in 2009 resulted primarily from a net gain on sale of assets. The $5.1 million of income in 2008 resulted primarily from recoveries of insurance claims partially offset by impairment charges. A schedule of the components of other expenses (income), net can be found at Note 7 to our condensed financial statements at Part 1, Item 1 to this quarterly report. Interest Expense, Net
Interest expense, net was $3.0 million in the twenty-eight weeks ended July 12, 2009, a $1.7 million decrease from 2008 resulting primarily from lower average debt balances and lower average interest rates on debt as compared to 2008. A schedule of the components of interest expense, net can be found at Note 9 to our condensed financial statements included at Part 1, Item 1 to this quarterly report.
Income Tax Expense
Income tax expense was $6.9 million in the twenty-eight weeks ended July 12, 2009 as compared to $8.5 million in 2008. Our effective tax rate in 2009 and 2008 was 37.7% and 39.5% respectively. The effective tax rate differs from statutory rates due to adjustments to estimated tax reserves, non-deductible goodwill impairments, other permanent differences and inter-period allocations. Liquidity and Capital Resources
We finance our business activities primarily with:
• cash flows generated from operating activities, and

• borrowings under the 2005 Credit Facility.

Our franchise model provides reliable and stable cash flows. Net cash provided by operating activities of the Company was $15.8 million and $19.9 million for the twenty-eight weeks ended July 12, 2009 and July 13, 2008, respectively. See our condensed statements of cash flows in our condensed financial statements included in Part 1, Item 1 to this quarterly report. Based primarily upon our generation of cash flow from operations, our existing cash reserves ($19.0 million available as of July 12, 2009), and available borrowings under our 2005 Credit Facility, we believe that we will have adequate cash flow to meet our anticipated future requirements for working capital, including various contractual obligations and expected capital expenditures.
During the second quarter of 2009, the Company realized $7.1 million in combined cash proceeds from the re-franchising of 13 company-operated restaurants in the Atlanta, Georgia market and the sale of nine properties in the Texas market. Subsequent to the end of the Company's second quarter, the Company received payment of $10.2 million under the terms of a receivable which was recorded as a component of "Non-current notes receivable and other long-term assets, net" in the condensed balance sheet as of July 12, 2009. Under the terms of the 2005 Credit Facility as amended, the proceeds must be reinvested within nine months or used to prepay the term loan.
Our cash flows and available borrowings allow us to pursue our growth strategies. Our priorities in the use of available cash are:
• reinvestment in our core business activities that promote the Company's strategic initiatives,

• reduction of long-term debt, and

• repurchase of our common shares (subject to the restrictions under our 2005 Credit Facility as amended).

. . .