IN THE UNITED STATES BANKRUPTCY COURT FOR THE DISTRICT OF DELAWARE In re: PERKINS & MARIE CALLENDERS INC.

,1 et al., Debtors. Chapter 11 Case No. 11-11795 (KG) Jointly Administered

Ref. Docket Nos. 922 and 935

DECLARATION OF JOSEPH H. SANTARLASCI, JR. IN SUPPORT OF CONFIRMATION OF DEBTORS SECOND AMENDED JOINT PLAN OF REORGANIZATION UNDER CHAPTER 11 OF THE BANKRUPTCY CODE I, Joseph H. Santarlasci, Jr., do hereby submit this declaration (the Declaration) and declare under penalty of perjury that the following information is true to the best of my knowledge, information and belief: 1. I am President and CEO of Whitby, Santarlasci & Co. (WS&Co.), a

professional services firm located at 2210 Wyoming Avenue NW, Washington, DC 20008. WS&Co. is an independent financial advisory firm headquartered in Washington, DC. Founded in 1985, WS&Co. provides owners, chief executives and key stakeholders of public and private companies with strategic and financial advice that generally results in a financial transaction. WS&Co. has successfully completed more than 30 strategic and financial advisory assignments totaling over $2 billion. WS&Co.s clients represent industry leaders in retail, branded and unbranded consumer products, health care, restaurants, equipment services, outdoor signs, and a number of additional product areas. WS&Co. is run by me, Joseph H. Santarlasci, Jr. I have

The Debtors, together with the last four digits of each Debtors federal tax identification number, are: Perkins & Marie Callenders Inc. (4388); Perkins & Marie Callenders Holding Inc. (3999); Perkins & Marie Callenders Realty LLC (N/A); Perkins Finance Corp. (0081); Wilshire Restaurant Group LLC (0938); PMCI Promotions LLC (7308); Marie Callender Pie Shops, Inc. (7414); Marie Callender Wholesalers, Inc. (1978); MACAL Investors, Inc. (4225); MCID, Inc. (2015); Wilshire Beverage, Inc. (5887); and FIV Corp. (3448). The mailing address for the Debtors is 6075 Poplar Avenue, Suite 800, Memphis, TN 38119.

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worked in investment banking and related financial services for over 38 years. My experience is in debt restructuring and analysis, corporate valuation and restructuring and corporate management. I graduated from Brown University, Darden School of Business and served in the United States Navy with Vietnam Service. 2. On June 13, 2011 (the Petition Date), each of the above-captioned

debtors (collectively, the Debtors) filed a voluntary petition for relief under chapter 11 of the Bankruptcy Code, and each thereby commenced chapter 11 cases (collectively, the Chapter 11 Cases) in this Bankruptcy Court (the Court). 3. Additional information about the Debtors businesses, the events leading

up to the Petition Date, and the facts and circumstances surrounding the Debtors and the Chapter 11 Cases can be found in (i) the Second Amended Disclosure Statement for Debtors Second Amended Joint Plan of Reorganization Under Chapter 11 of the Bankruptcy Code [Docket No. 923] (including all exhibits thereto, the Disclosure Statement) heretofore filed with this Court, and (ii) the Declaration of Joseph F. Trungale In Support of the Debtors Second Amended Joint Plan of Reorganization Under Chapter 11 of the Bankruptcy Code, filed contemporaneously with this Declaration and incorporated by reference herein. 4. I am submitting this Declaration in support of confirmation of the

Debtors Second Amended Joint Plan of Reorganization Under Chapter 11 of the Bankruptcy Code, dated September 9, 2011 [Docket No. 922] (including all exhibits thereto and as may be amended, modified or supplemented from time to time, the Plan).2 5. Prior to the Petition Date, WS&Co. provided financial advisory services to

the Debtors. On July 9, 2011, the Court entered an Order approving the retention of WS&Co. as
Capitalized terms used but not otherwise defined herein shall have the meanings ascribed to such terms in the Plan.
2

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the Debtors financial advisor and investment banker in connection with the Chapter 11 Cases. Through that retention I have become familiar with the Debtors businesses and financial affairs and I have been the financial advisor primarily responsible for preparing, under the direction and supervision of the Debtors management and with the assistance of the Debtors personnel and professional advisors, the liquidation analysis attached as Exhibit D to the Disclosure Statement (the Liquidation Analysis). With respect to each impaired Class of Claims or Interests, the Liquidation Analysis indicates that each holder of a Claim or Interest in an Impaired Class has voted to accept the Plan or will receive or retain under the Plan on account of such Claim or Interest property of a value, as of the Effective Date, that is not less than the amount that such holder would so receive or retain if the Debtors businesses were liquidated under chapter 7 of the Bankruptcy Code on such date. 6. I believe that the ranges of estimated liquidation values set forth in the

Liquidation Analysis are fair and reasonable estimates of the value of the Debtors businesses upon a liquidation under chapter 7 of the Bankruptcy Code, and that based on those estimates, each Class of Claims and Interests will receive under the Plan at least as much as that Class would receive in a hypothetical chapter 7 liquidation. 7. The Liquidation Analysis generally examines the effects that a conversion

of the Chapter 11 Cases to cases under chapter 7 of the Bankruptcy Code could have on the proceeds available for distribution under the Plan to holders of Allowed Claims. Based upon the Liquidation Analysis, holders of Allowed Administrative Claims, Priority Tax Claims, Other Priority Claims and Other Secured Claims would receive an estimated 0% recovery on their Allowed Claims in a chapter 7 liquidation, whereas to the contrary any and all such Allowed Claims are Unimpaired under the Plan. Likewise, holders of Allowed Senior Notes Claims,

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General Unsecured Claims and Intercompany Claims would receive an estimated recovery of 0% with respect to their Allowed Claims under a chapter 7 liquidation scenario; however, under the Plan said creditors will receive a meaningful recovery under the Plan. Holders of Class 8 Subordinated Claims and Class 9A Equity Interests in PMC Holding and PMCI are not receiving any Distributions under the Plan. 8. In light of the foregoing, I believe that the Plan satisfies the requirements

of section 1129(a)(7) of the Bankruptcy Code, as the recoveries realized by holders of Allowed Senior Secured Notes Claims, Senior Notes Claims, and General Unsecured Claims under the Plan are estimated to be greater than the distributions such holders would receive in a hypothetical chapter 7 case, and the holders of Class 8 Subordinated Claims and Class 9A Equity Interests in PMC Holding and PMCI are not receiving any distribution under the Plan. 9. Additionally, I believe that the Plan is feasible and complies with section

1129(a)(11) of the Bankruptcy Code. Upon emergence from bankruptcy, the Debtors, through their reorganization, will have significantly reduced their debt obligations. The Debtors, with the assistance of WS&Co., have also negotiated an Exit Financing that will provide adequate liquidity for the Reorganized Debtors working capital needs at emergence, have maintained normal trade credit terms with the majority of their principal suppliers, and have eliminated or re-negotiated lease terms on a number of underperforming and non-performing restaurant locations in their pre-petition restaurant portfolio through the reorganization process, which should materially improve the Debtors overall financial health and performance. Consequently, I believe that the Debtors will have more than sufficient ability to pay their debts as they come due and the Plan is not likely to be followed by the liquidation, or the need for further financial reorganization, of the Reorganized Debtors.

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10.

WS&Co. has thoroughly analyzed the Debtors ability to meet their

obligations and to continue to operate viably after the Effective Date. As part of WS&Co.s analysis, WS&Co, among other things, (i) reviewed certain financial statements of the Debtors for recent years and interim periods; (ii) reviewed certain internal financial and operating data prepared by the Debtors; (iii) discussed the current operations and prospects of the business with the Debtors management; (iv) reviewed publicly available information regarding certain companies engaged in businesses deemed reasonably comparable to that of the Debtors; (v) reviewed certain information regarding merger and acquisition transactions, to the extent publicly available, involving certain companies engaged in businesses deemed reasonably comparable to that of the Debtors; (vi) considered certain economic and industry information relevant to the Debtors' businesses; (vii) reviewed various documents relating to the Plan; and (viii) reviewed such other information, performed such other analyses and took into account such other factors as WS&Co. deemed relevant, necessary or appropriate. 11. In connection with the foregoing analyses, WS&Co., under the direction

and supervision of the Debtors management and with the assistance of the Debtors personnel and professional advisors, was primarily responsible for the financial projections attached as Exhibit C to the Disclosure Statement (the Financial Projections), which demonstrate the Debtors ability to satisfy their Plan obligations and to continue to operate viably after the Effective Date. The Financial Projections include projections of the financial performance of the Reorganized Debtors for the period through the end of fiscal year 2015 (the Projection Period), and include for each fiscal year in the Projection Period pro forma projected consolidated balance sheets, pro forma projected consolidated income statements and pro forma projected consolidated statements of cash flow.

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12.

The Financial Projections are based, in part, on economic, competitive,

and general business conditions prevailing at the time of preparation. The Financial Projections necessarily have also been based on a variety of estimates and assumptions that were considered reasonable by the Debtors during the preparation of those projections. The Financial Projections indicate that the Reorganized Debtors should have sufficient cash flow to pay and service their debt obligations, and to fund their ongoing operations contemplated by their business plan. The Financial Projections additionally indicate that the Debtors have obtained adequate means to satisfy their funding commitments and other obligations under the Plan on and after the Effective Date. Although the Debtors businesses operate in a highly competitive industry and market, and although it is impossible to predict with certainty the precise future profitability of the Debtors businesses or industry and the market in which the Debtors operate, I believe that confirmation of the Plan is not likely to be followed by the Reorganized Debtors need to further reorganize or to liquidate. 13. Additionally, I believe that the Plan provides adequate means for its

implementation. In compliance with section 1123(a)(5) of the Bankruptcy Code, Article VII of the Plan sets forth the means for implementation of the Plan, which means are adequate and proper. The Debtors or Reorganized Debtors, through the Disbursing Agent or such other entity, will be able to make all of the Distributions under, and comply with all other provisions of, the Plan, as the Debtors estimate that they will have sufficient Cash to ensure that the holders of Allowed Administrative Claims, Professional Fee Claims, Priority Tax Claims and DIP Financing Claims and Allowed Claims in Classes 1 and 2 are satisfied in full, and holders of Allowed Claims in Classes 3, 4, 5 and 6 will receive the Distributions required under the Plan.

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CONCLUSION 14. I believe that the Plan will enable the holders of Allowed Claims to realize

the highest possible recoveries under the circumstances of these Chapter 11 Cases. I therefore conclude that the Plan is in the best interests of the Debtors, their Estates and creditors and other interested parties, and respectfully request that this Court enter an order confirming the Plan. 15. I declare under penalty of perjury under the laws of the United States of

America that the foregoing is true and correct to the best of my knowledge, information and belief. Executed on this 27th day of October, 2011.

/s/ Joseph H. Santarlasci, Jr. Joseph H. Santarlasci, Jr. President and CEO of Whitby, Santarlasci & Co.

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