TRIARC COMPANIES INC
S-4, 1994-03-10
BROADWOVEN FABRIC MILLS, COTTON
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<PAGE>
     AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON MARCH 10, 1994
 
                                                     REGISTRATION NO. 33-
________________________________________________________________________________
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549
                            ------------------------
 
                                    FORM S-4
                             REGISTRATION STATEMENT
                                     UNDER
                           THE SECURITIES ACT OF 1933
                            ------------------------
 
                             TRIARC COMPANIES, INC.
             (EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
                            ------------------------
 
<TABLE>
<S>                                                   <C>                                         <C>
                                                  2086, 2087, 5812,
                 OHIO                                 2211, 5984                              38-0471180
   (STATE OR OTHER JURISDICTION OF           (PRIMARY STANDARD INDUSTRIAL                  (I.R.S. EMPLOYER
    INCORPORATION OR ORGANIZATION)             CLASSIFICATION CODE NO.)                  IDENTIFICATION NO.)
</TABLE>
 
                            777 SOUTH FLAGLER DRIVE
                         WEST PALM BEACH, FLORIDA 33401
                                 (407) 653-4000
              (ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER,
       INCLUDING AREA CODE, OF REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES)
                            ------------------------
 
                             CURTIS S. GIMSON, ESQ.
                             TRIARC COMPANIES, INC.
                            777 SOUTH FLAGLER DRIVE
                         WEST PALM BEACH, FLORIDA 33401
                                 (407) 653-4000
               (NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE
               NUMBER, INCLUDING AREA CODE, OF AGENT FOR SERVICE)
                            ------------------------
 
                                    COPY TO:
                             BRIAN L. SCHORR, ESQ.
                    PAUL, WEISS, RIFKIND, WHARTON & GARRISON
                          1285 AVENUE OF THE AMERICAS
                         NEW YORK, NEW YORK 10019-6064
                                 (212) 373-3000
                            ------------------------
 
     APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: As soon as
practicable  after this Registration  Statement becomes effective  and all other
conditions to the  Merger, pursuant  to the Merger  Agreement described  herein,
have been satisfied or waived.
 
     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, check the following box: [ ]
                            ------------------------
                        CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
                                                                          PROPOSED          PROPOSED
                                                                          MAXIMUM           MAXIMUM         AMOUNT OF
      TITLE OF EACH CLASS OF SECURITIES             AMOUNT TO BE       OFFERING PRICE      AGGREGATE       REGISTRATION
              TO BE REGISTERED                       REGISTERED           PER UNIT       OFFERING PRICE        FEE
 
<S>                                             <C>                    <C>               <C>               <C>
Class A Common Stock, $.10 par value.........   2,691,822 shares(1)         (2)               (2)             (2)(3)
</TABLE>
 
(1) Based  upon the maximum  number of shares  that may be  issued in the Merger
    described herein.
 
(2) The registration fee for all the securities registered hereby, $17,984,  has
    been calculated pursuant to Rule 457(f)(1) under the Securities Act of 1933,
    as  amended, as follows:  one twenty-ninth of  1% of (A)  the product of (a)
    $15.50, the average of the  high and low prices  of shares of SEPSCO  Common
    Stock reported on the Pacific Stock Exchange on March 7, 1994, multiplied by
    (B) 3,364,778, the maximum number of shares of SEPSCO Common Stock which may
    be exchanged upon consummation of the Merger.
 
(3) A fee of $16,185 was paid on behalf of Triarc Companies Inc. with respect to
    the  transaction  on September  13, 1993,  pursuant to  a filing  under Rule
    14a-6(a) of a Schedule  14A. Pursuant to Rule  457(b) promulgated under  the
    Securities  Act and Section 14(g)(1)(B) and  Rule 0-11 promulgated under the
    Securities Exchange Act of 1934, as  amended, the amount of such  previously
    paid  fee  has  been  credited  against  the  registration  fee  which would
    otherwise be  payable  in  connection  with  this  filing.  Accordingly,  an
    additional   filing  fee  of  $1,799  is  required  to  be  paid  with  this
    Registration Statement.
                            ------------------------
     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  OR UNTIL  THE REGISTRATION  STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION  8(a),
MAY DETERMINE.
 
________________________________________________________________________________

<PAGE>
                             TRIARC COMPANIES, INC.
                             CROSS-REFERENCE SHEET
                     PURSUANT TO REGULATION S-K ITEM 501(b)
 
<TABLE>
<CAPTION>
                     FORM S-4 ITEM NUMBER AND CAPTION                       LOCATION IN PROXY STATEMENT/PROSPECTUS
- --------------------------------------------------------------------------  ---------------------------------------
<S>   <C>                                                                   <C>
  1.  Forepart of the Registration Statement and Outside Front Cover Page
        of Prospectus.....................................................  Outside Front Cover Page of Proxy
                                                                              Statement/Prospectus; Introduction.
  2.  Inside Front and Outside Back Cover Pages of Prospectus.............  Available Information; Information
                                                                              Incorporated by Reference; Table of
                                                                              Contents.
  3.  Risk Factors, Ratio of Earnings to Fixed Charges and Other
        Information.......................................................  Introduction; Summary; Risk Factors;
                                                                              Triarc and Consolidated Subsidiaries
                                                                              Selected Financial Data; SEPSCO and
                                                                              Subsidiaries Selected Financial Data.
  4.  Terms of the Transaction............................................  Introduction; Summary; Special
                                                                              Factors -- Purpose and Structure of
                                                                              the Merger;  -- Certain Effects of
                                                                              the Merger and Related Transactions;
                                                                               -- Recommendation of the SEPSCO
                                                                              Special Committee and the SEPSCO
                                                                              Board;  -- Opinion of Financial
                                                                              Advisor; The Merger Agreement;
                                                                              Financing of the Merger and Related
                                                                              Transactions: Source and Amount of
                                                                              Funds; Information Relating to
                                                                              Mergerco; Description of Triarc
                                                                              Capital Stock; Certain Federal Income
                                                                              Tax Consequences of the Merger;
                                                                              Comparison of Rights of Holders of
                                                                              SEPSCO Common Stock and Triarc Class
                                                                              A Common Stock.
  5.  Pro Forma Financial Information.....................................  Summary; Pro Forma Financial
                                                                              Statements.
  6.  Material Contacts with the Company Being Acquired...................  Introduction; Summary; The Special
                                                                              Meeting; Special
                                                                              Factors -- Recommendation of the
                                                                              SEPSCO Special Committee and the
                                                                              SEPSCO Board; Certain Relationships
                                                                              and Related Transactions; The Merger
                                                                              Agreement; Financing of the Merger
                                                                              and Related Transactions: Source and
                                                                              Amount of Funds; Management of
                                                                              SEPSCO; Ownership of SEPSCO
                                                                              Securities by certain Beneficial
                                                                              Owners and Management.
  7.  Additional Information Required for Reoffering by Persons and
        Parties Deemed to be Underwriters.................................  Not Applicable.
  8.  Interests of Named Experts and Counsel..............................  Not Applicable.
 
<PAGE>
<CAPTION>
                     FORM S-4 ITEM NUMBER AND CAPTION                       LOCATION IN PROXY STATEMENT/PROSPECTUS
- --------------------------------------------------------------------------  ---------------------------------------
<S>   <C>                                                                   <C>
  9.  Disclosure of Commission Position on Indemnification for Securities
        Act Liabilities...................................................  Not Applicable.
 10.  Information with Respect to S-3 Registrants.........................  Introduction; Summary; Market for
                                                                              Triarc's Common Equity and Related
                                                                              Shareholder Matters; Triarc and
                                                                              Consolidated Subsidiaries Selected
                                                                              Financial Data; Business of Triarc
                                                                              Companies; Triarc Companies
                                                                              Management's Discussion and Analysis
                                                                              of Financial Condition and Results of
                                                                              Operations.
 11.  Incorporation of Certain Information by Reference...................  Information Incorporated by Reference.
 12.  Information with Respect to S-2 or S-3 Registrants..................  Not Applicable.
 13.  Incorporation of Certain Information by Reference...................  Not Applicable.
 14.  Information with Respect to Registrants Other Than S-3 or S-2
        Registrants.......................................................  Not Applicable.
 15.  Information with Respect to S-3 Companies...........................  Not Applicable.
 16.  Information with Respect to S-2 or S-3 Companies....................  Not Applicable.
 17.  Information with Respect to Companies Other Than S-2 and S-3
        Companies.........................................................  Introduction; Summary; Market for
                                                                              SEPSCO's Common Equity and Related
                                                                              Stockholder Matters; SEPSCO and
                                                                              Subsidiaries Selected Financial Data;
                                                                              Business of SEPSCO; SEPSCO
                                                                              Management's Discussion and Analysis
                                                                              of Financial Condition and Results of
                                                                              Operations.
 18.  Information if Proxies, Consents or Authorizations are to be
        Solicited.........................................................  Introduction; Summary; The Special
                                                                              Meeting; Special Factors -- Interests
                                                                              of Certain Persons in the Merger;
                                                                               -- Conduct of the Business of the
                                                                              Surviving Corporation After the
                                                                              Merger; The Merger Agreement;
                                                                              Management of Triarc; Triarc
                                                                              Executive Compensation; Ownership of
                                                                              Triarc Securities By Certain
                                                                              Beneficial Owners and Management;
                                                                              Management of SEPSCO; Ownership of
                                                                              SEPSCO Securities By Certain
                                                                              Beneficial Owners and Management.
 19.  Information if Proxies, Consents or Authorizations Are not to be
        Solicited or in an Exchange Offer.................................  Not Applicable.




</TABLE>

<PAGE>
                                                                PRELIMINARY COPY
 

                      SOUTHEASTERN PUBLIC SERVICE COMPANY
                       777 S. FLAGLER DRIVE, SUITE 1000E
                         WEST PALM BEACH, FLORIDA 33401

 

                                                                  March 14, 1994

 
TO OUR STOCKHOLDERS:
 

     It  is  our  pleasure  to  invite  you  to  attend  a  Special  Meeting  of
Stockholders of Southeastern Public Service  Company (the 'Company') to be  held
on  Thursday, April 14, 1994, commencing at  12:00 noon, local time, at the Palm
Beach Airport Hilton, 150 Australian Avenue, West Palm Beach, Florida.

 
     The purpose of the Special Meeting is to consider and vote upon a  proposal
to  adopt an Agreement and Plan of  Merger (the 'Merger Agreement'), dated as of
November  22,  1993,  by  and  among  the  Company,  SEPSCO  Merger  Corporation
('Mergerco'),  a wholly  owned subsidiary  of Triarc  Companies, Inc. ('Triarc')
(formerly known as DWG Corporation), and  Triarc, which provides for the  merger
(the  'Merger')  of  Mergerco  into  the Company,  with  the  Company  being the
surviving corporation.  In this  Merger, holders  of outstanding  shares of  the
Company's Common Stock, other than Triarc and its subsidiaries, will receive 0.8
of  a share of Triarc's Class A Common Stock for each of their shares of Company
Common Stock.
 
     A special committee of the Board of Directors of the Company (the  'Special
Committee') has considered the terms and conditions of the Merger. In connection
with  such consideration, the  Special Committee retained  Smith Barney Shearson
Inc. ('Smith Barney')  to act as  its independent financial  advisor. A copy  of
Smith  Barney's written opinion  as to the  fairness, from a  financial point of
view, to the stockholders  of SEPSCO (other than  Triarc and its affiliates)  of
the consideration to be received in the Merger by such stockholders, is included
as an Annex II to the attached Proxy Statement-Prospectus. The Special Committee
and  your Board of Directors have each unanimously approved the Merger Agreement
and your Board of Directors recommends that you vote FOR adoption of the  Merger
Agreement.
 
     The Merger is structured to satisfy Triarc's obligations under the terms of
a  Stipulation  of  Settlement  (the  'Settlement  Agreement')  relating  to the
settlement of a purported derivative action (the 'Action') brought by a  Company
stockholder  on behalf of the Company  against Triarc, certain of its affiliates
and certain individuals. On January 11, 1994,  the court in which the Action  is
pending approved the terms of the Settlement Agreement.
 
     The  attached  Proxy  Statement-Prospectus  is a  proxy  statement  for the
Special Meeting and a prospectus for the  shares of Triarc Class A Common  Stock
to be issued to holders of the Company's Common Stock in the Merger.
 
     Please give these proxy materials your careful attention, as the discussion
included  therein is important to your decisions on the matters being presented.
Your vote is important and it is  important that your shares be represented  and
voted  at the  Meeting, regardless  of the  size of  your holdings. Accordingly,
whether or not you plan to attend  the Meeting in person, please promptly  mark,
sign  and date  the enclosed  proxy and  return it  in the  enclosed envelope to
assure that your shares will be represented at the Meeting.
 
     Stockholders should not  send in  their stock  certificates when  returning
their  proxies. If the Merger is  consummated, stockholders will be notified and
furnished with instructions as to how  and when to submit stock certificates  to
receive the merger consideration.
 
                                         Sincerely yours,
 
<TABLE>
<S>                          <C>
NELSON PELTZ                 PETER W. MAY
Chairman and Chief           President and Chief
Executive Officer            Operating Officer
</TABLE>

<PAGE>
                                                                PRELIMINARY COPY

                      SOUTHEASTERN PUBLIC SERVICE COMPANY
                       777 S. FLAGLER DRIVE, SUITE 1000E,
                         WEST PALM BEACH, FLORIDA 33401
                         ------------------------
                   NOTICE OF SPECIAL MEETING OF STOCKHOLDERS
                     TO BE HELD ON THURSDAY, APRIL 14, 1994
 

                            ------------------------
     NOTICE IS HEREBY GIVEN that a Special Meeting of Stockholders (the 'Special
Meeting')  of Southeastern Public  Service Company, a  Delaware corporation (the
'Company'), will be held on Thursday, April 14, 1994, commencing at 12:00  noon,
local  time, at the Palm Beach Airport  Hilton, 150 Australian Avenue, West Palm
Beach, Florida, for the following purposes:

 
          (1) To consider and  vote upon a proposal  to adopt the Agreement  and
     Plan  of Merger, dated as of November 22, 1993 (the 'Merger Agreement'), by
     and among  the Company,  SEPSCO Merger  Corporation and  Triarc  Companies,
     Inc.,  a  copy of  which  attached as  Annex  I to  the  accompanying Proxy
     Statement-Prospectus; and
 
          (2) To transact such  other business as may  properly come before  the
     Special Meeting or any adjournments or postponements thereof.
 
     Holders   of  the  Company's  outstanding   shares  of  5  1/2%  Cumulative
Convertible Preferred Stock, Series B (the 'Preferred Shares') have the right to
dissent from the merger and seek an appraisal of their Preferred Shares pursuant
to court proceedings by following the procedures prescribed under Section 262 of
the Delaware General  Corporation Law. THE  HOLDERS OF SHARES  OF THE  COMPANY'S
COMMON STOCK DO NOT HAVE THE RIGHT TO SEEK AN APPRAISAL OF THEIR SHARES PURSUANT
TO ANY SUCH COURT PROCEEDING.
 
     Only stockholders of record on March 7, 1994 are entitled to receive notice
of  and to  vote at  the Special Meeting  and any  adjournments or postponements
thereof.   See    'THE   SPECIAL    MEETING'   in    the   accompanying    Proxy
Statement-Prospectus.
 
     Please promptly mark, sign and date the enclosed proxy and return it in the
enclosed  envelope whether or not  you plan to attend  the Special Meeting. Your
proxy may be revoked at any time before it is voted by filing with the Secretary
of the  Company a  written  revocation of  proxy bearing  a  later date,  or  by
attending and voting in person at the Special Meeting.
 
                                          By Order of the Board of Directors,
                                          CURTIS S. GIMSON
                                          Senior Vice President and
                                          Associate General Counsel, and
                                          Secretary
 

West Palm Beach, Florida
March 14, 1994

 
YOUR  VOTE IS IMPORTANT. WHETHER OR NOT YOU  EXPECT TO BE PRESENT AT THE SPECIAL
MEETING, PLEASE MARK, SIGN AND DATE AND RETURN THE ACCOMPANYING PROXY PROMPTLY.
 
PLEASE DO NOT SEND ANY STOCK CERTIFICATES AT THIS TIME.

<PAGE>

        SUBJECT TO COMPLETION PRELIMINARY PROXY STATEMENT_--_PROSPECTUS
                              DATED MARCH 10, 1994

 
                                PROXY STATEMENT
                                       OF
                      SOUTHEASTERN PUBLIC SERVICE COMPANY
                        SPECIAL MEETING OF STOCKHOLDERS
                          TO BE HELD ON APRIL 14, 1994
                            ------------------------
                                   PROSPECTUS
                                       OF
                             TRIARC COMPANIES, INC.
                           (FORMERLY DWG CORPORATION)
                              CLASS A COMMON STOCK
                            PAR VALUE $.10 PER SHARE
                            ------------------------
 
                                  INTRODUCTION
 

     This  Proxy  Statement-Prospectus  is being  furnished  to  stockholders of
Southeastern Public  Service  Company,  a Delaware  corporation  ('SEPSCO'),  in
connection  with the solicitation of proxies by the Board of Directors of SEPSCO
(the 'SEPSCO Board')  from holders of  the outstanding shares  of SEPSCO  common
stock,  par value  $1.00 per  share ('SEPSCO Common  Stock'), and  SEPSCO 5 1/2%
Cumulative Convertible Preferred  Stock, Series  B, par value  $50.00 per  share
('SEPSCO Preferred Stock' and together with the SEPSCO Common Stock, the 'SEPSCO
Voting Stock'), for use at a special meeting of stockholders of SEPSCO scheduled
to  be held on April 14, 1994, commencing at 12:00 noon, local time, at the Palm
Beach Airport Hilton, 150  Australian Avenue, West Palm  Beach, Florida, and  at
any  adjournments or postponements thereof (the 'Special Meeting'). Only holders
of SEPSCO Common Stock and SEPSCO Preferred Stock (each, a 'SEPSCO Stockholder')
at the close of business  on March 7, 1994 (the  'Record Date') are entitled  to
notice  of  and  to  vote  at  the  Special  Meeting  and  any  adjournments  or
postponements thereof. On  the Record  Date, there  were outstanding  11,655,067
shares  of SEPSCO Common  Stock, 8,290,289 of  which (constituting approximately
71.1% of such  outstanding shares)  were held  by a  wholly-owned subsidiary  of
Triarc  Companies, Inc.  ('Triarc'), an Ohio  corporation formerly  known as DWG
Corporation, and 490 shares of SEPSCO Preferred Stock, all of which were held by
Triarc. This  Proxy Statement-Prospectus  and a  form of  proxy for  use at  the
Special  Meeting are first being mailed on or about March 14, 1994 to holders of
record on the Record Date of shares of SEPSCO Common Stock and SEPSCO  Preferred
Stock.

 
- ----------------------------------------------------------
       SEE 'RISK FACTORS' FOR A DESCRIPTION OF CERTAIN RISKS RELATING TO
                    THE MERGER AND THE MERGER CONSIDERATION.
 
- ----------------------------------------------------------
     At  the Special  Meeting, stockholders will  be asked to  consider and vote
upon a proposal to adopt the Agreement and Plan of Merger, dated as of  November
22,   1993  (the  'Merger  Agreement'),  by  and  among  Triarc,  SEPSCO  Merger
Corporation, a  Delaware  corporation  and wholly  owned  subsidiary  of  Triarc
('Mergerco'),  and SEPSCO, a copy of which is  attached as Annex I to this Proxy
Statement -- Prospectus, pursuant to which (a) Mergerco will be merged with  and
into  SEPSCO (the  'Merger'), with SEPSCO  being the  surviving corporation (the
'Surviving Corporation'), all of the stock of which will be owned by Triarc, and
(b) each share of SEPSCO Common Stock outstanding immediately prior to the  time
the Merger becomes effective (the 'Effective Time'), other than shares which are
held  by Triarc or a  subsidiary of Triarc, will be  converted into the right to
receive 0.8 of  a share of  Triarc's Class A  Common Stock, par  value $.10  per
share  ('Triarc  Class A  Common  Stock'), all  as  described below.  This Proxy
Statement also constitutes  the Prospectus  of Triarc  for the  issuance of  the
shares of Triarc Class A Common Stock in connection with the Merger.
 
     Holders  of shares of SEPSCO Preferred Stock have the right to dissent from
the Merger and  (in the  event that  the Merger  Agreement is  approved and  the
Merger  consummated) seek an appraisal of their shares of SEPSCO Preferred Stock
pursuant to  court proceedings,  by following  the procedures  prescribed  under
Section  262  ('Section  262')  of the  Delaware  General  Corporation  Law (the
'DGCL'). HOLDERS OF SHARES OF SEPSCO COMMON STOCK DO NOT HAVE THE RIGHT TO  SEEK
AN  APPRAISAL OF  THEIR SHARES.  Triarc holds  all outstanding  shares of SEPSCO
Preferred Stock and has agreed to vote  all such shares FOR the adoption of  the
Merger  Agreement and, therefore, will not be  able to exercise its rights under
Section 262.
 
     Triarc Class A Common Stock is listed on the New York Stock Exchange,  Inc.
(the 'NYSE') under the symbol 'TRY.'
 
                                                  (Cover continued on next page)
 
- ----------------------------------------------------------
THE   SHARES  OF  TRIARC  CLASS  A  COMMON  STOCK  HAVE  NOT  BEEN  APPROVED  OR
DISAPPROVED BY THE  SECURITIES AND  EXCHANGE COMMISSION NOR  HAS THE  COMMISSION
     PASSED  UPON THE ACCURACY OR ADEQUACY  OF THE INFORMATION CONTAINED IN
        THIS  PROXY  STATEMENT-PROSPECTUS.  ANY  REPRESENTATION  TO  THE
                                   CONTRARY IS A CRIMINAL OFFENSE.

 
- ----------------------------------------------------------
         THE DATE OF THIS PROXY STATEMENT-PROSPECTUS IS MARCH   , 1994.

 
<PAGE>
(Cover continued from previous page.)
 
     Approximately  2,691,822  shares of  Triarc Class  A  Common Stock  will be
issued by Triarc in the Merger.  Such shares will represent approximately  11.2%
of  the issued and outstanding shares of Triarc Class A Common Stock immediately
after giving effect to the issuance of shares of Triarc Class A Common Stock  in
the Merger.
 
     Pursuant  to the  terms of  the Merger  Agreement, each  holder immediately
prior to the Effective Time of shares of SEPSCO Common Stock (other than  Triarc
and  its subsidiaries) will receive (a) a number of whole shares of Triarc Class
A Common Stock determined by multiplying  the number of shares of SEPSCO  Common
Stock  owned by such stockholder immediately prior  to the Effective Time by 0.8
and (b) cash in  lieu of any  fractional shares of Triarc  Class A Common  Stock
which  they would otherwise be entitled to receive. The shares of Triarc Class A
Common Stock, and cash  in lieu of  fractional shares of  Triarc Class A  Common
Stock,  to  be received  by holders  of SEPSCO  Common Stock  in the  Merger are
sometimes hereinafter referred to as the 'Merger Consideration.'
 
     Consummation of the Merger will satisfy certain of the terms and conditions
(the 'Settlement Terms and Conditions') contained in a Stipulation of Settlement
(the  'Settlement  Agreement')  relating  to  the  settlement  of  a   purported
derivative  action  (the 'Ehrman  Litigation') brought  on  behalf of  SEPSCO by
William A.  Ehrman  (the 'Plaintiff'),  a  SEPSCO stockholder,  against  Triarc,
certain  of  its affiliates  and certain  individuals, including  certain former
directors of  SEPSCO (together,  the  'Defendants'). On  January 11,  1994,  the
United States District Court for the Southern District of Florida (the 'District
Court'), the court before which the Ehrman Litigation is pending, held a hearing
on  the  Settlement  Agreement  and  following  such  hearing  entered  an order
approving the Settlement Agreement.
 
     If the Merger is consummated, the  District Court will permanently bar  and
enjoin  the institution or prosecution by  the Plaintiff and his counsel, either
directly or derivatively,  SEPSCO and  SEPSCO's stockholders, and  any of  their
respective    representatives,    trustees,   successors,    heirs,   executors,
administrators and assigns, of all claims, rights or causes of action, they  now
have  or ever had whether  known or unknown or suspected  to exist which were or
could have been  asserted in the  Ehrman Litigation,  or in any  other court  or
forum,  in connection with, arising out of, or  in any way relating to any acts,
facts, transactions,  omissions or  other subject  matters set  forth,  alleged,
embraced, or otherwise referred to in the Ehrman Litigation, the complaint filed
by  Plaintiff  in  connection  with  the  Ehrman  Litigation  or  the Settlement
Agreement, against  (i) any  Defendant,  (ii) any  present or  former  director,
officer,  agent, financial  or legal  advisor, predecessor  or successor  of any
corporate Defendant, (iii) any subsidiary of  a corporate Defendant or (iv)  any
financial  or legal advisor of any  such subsidiary (collectively, the 'Released
Persons').
 
     Approval of  the  proposal  to  adopt the  Merger  Agreement  requires  the
affirmative  votes of (i) the holders of  at least a majority of the outstanding
shares  of  SEPSCO  Voting  Stock  entitled  to  vote  at  the  Special  Meeting
(considered  as a single class), (ii) the  holders of at least two-thirds of the
outstanding shares of  SEPSCO Preferred Stock  entitled to vote  at the  Special
Meeting,  and (iii) the holders of at least two-thirds of the outstanding shares
of SEPSCO Voting Stock,  other than those  held by Triarc  or any subsidiary  of
Triarc,  entitled to vote at the Special  Meeting (the foregoing votes being the
'Required Stockholder  Vote'). Triarc  owns  all of  the outstanding  shares  of
SEPSCO Preferred Stock and, through a wholly-owned subsidiary, owns a sufficient
number  of shares of SEPSCO Common Stock to cause the votes described in clauses
(i) and (ii) of the  preceding sentence to be obtained  without the vote of  any
other SEPSCO Stockholder. HOWEVER, THE OBTAINING OF THE VOTE DESCRIBED IN CLAUSE
(III)  DEPENDS SOLELY UPON THE VOTE OF SEPSCO STOCKHOLDERS OTHER THAN TRIARC AND
ITS SUBSIDIARY AND CANNOT  BE ASSURED. IF SUCH  CONDITION IS NOT SATISFIED,  THE
PROPOSAL  TO ADOPT THE MERGER AGREEMENT WILL NOT BE APPROVED AND THE MERGER WILL
NOT BE CONSUMMATED. If the Merger  is not consummated, the Settlement  Agreement
will  not enter into effect and  will be deemed null and  void ab initio and the
rights and duties of the parties  to the Ehrman Litigation will revert,  without
prejudice,  to their respective status immediately prior to the execution of the
Settlement Agreement.  Upon  the occurrence  of  such  event, and  if  no  other
settlement  or  resolution  of  the Ehrman  Litigation  is  reached,  Triarc has
indicated  that  it  will  vigorously  defend  itself  against  the  allegations
contained in the complaint filed by the Plaintiff in the Ehrman Litigation.
 
                                       2

<PAGE>
                               TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                  PAGE
                                                  ----
<S>                                               <C>
INTRODUCTION...................................     1
AVAILABLE INFORMATION..........................     4
INFORMATION INCORPORATED BY REFERENCE..........     5
LIST OF CERTAIN DEFINED TERMS..................     6
SUMMARY........................................     8
RISK FACTORS...................................    18
THE SPECIAL MEETING............................    21
    General....................................    21
    Voting at the Special Meeting..............    21
    Proxies....................................    21
SPECIAL FACTORS................................    23
    Background to the Merger; Reasons for the
       Merger..................................    23
         The Reorganization and Related
           Matters.............................    23
         Legal Proceedings Related to SEPSCO
           and Triarc..........................    25
    Purpose and Structure of the Merger........    28
    Certain Effects of the Merger and Related
       Transactions............................    28
    Conduct of the Business of the Surviving
       Corporation After the Merger............    29
    Recommendation of the SEPSCO Special
       Committee and the SEPSCO Board..........    29
    Opinion of Financial Advisor...............    32
    Interests of Certain Persons in the
       Merger..................................    35
PRO FORMA FINANCIAL STATEMENTS.................    36
THE MERGER AGREEMENT...........................    46
    General....................................    46
    Effective Time of Merger...................    46
    Conversion of Stock........................    46
    Payment for SEPSCO Common Stock............    46
    Certificate of Incorporation, By-laws,
       Directors...............................    47
    Conditions to the Merger...................    47
    Certain Agreements Pending the Merger......    49
    Termination................................    51
    Certain Other Provisions of the Merger
       Agreement...............................    52
FINANCING OF THE MERGER AND RELATED
  TRANSACTIONS: SOURCE AND AMOUNT OF FUNDS.....    53
CERTAIN FEDERAL INCOME TAX CONSEQUENCES OF THE
  MERGER.......................................    54
COMPARISON OF RIGHTS OF HOLDERS OF SEPSCO
  COMMON STOCK AND TRIARC CLASS A COMMON
  STOCK........................................    54
MARKET FOR TRIARC'S COMMON EQUITY AND RELATED
  SHAREHOLDER MATTERS..........................    61
MARKET FOR SEPSCO'S COMMON EQUITY AND RELATED
  STOCKHOLDER MATTERS..........................    62
TRIARC CAPITALIZATION..........................    63
SEPSCO CAPITALIZATION..........................    64
TRIARC AND CONSOLIDATED SUBSIDIARIES SELECTED
  FINANCIAL DATA...............................    65
SEPSCO AND SUBSIDIARIES SELECTED FINANCIAL
  DATA.........................................    66
BUSINESS OF TRIARC COMPANIES...................    67
    Introduction...............................    67
    Business Segments..........................    69
    General....................................    86
 
<CAPTION>
                                                  PAGE
                                                  ----
<S>                                               <C>
    Discontinued and Other Operations..........    89
    Properties.................................    92
BUSINESS OF SEPSCO.............................    94
    Introduction...............................    94
    Business Overview..........................    94
    Other Investments..........................    96
    Recent Transactions........................    96
    Environmental Matters......................    97
    Working Capital............................    97
    Intellectual Property; Research and
       Development; Backlog....................    97
    Employees..................................    98
    Legal Proceedings..........................    98
    Properties.................................    98
TRIARC COMPANIES MANAGEMENT'S DISCUSSION AND
  ANALYSIS OF FINANCIAL CONDITION AND RESULTS
  OF OPERATIONS................................    99
SEPSCO MANAGEMENT'S DISCUSSION AND ANALYSIS OF
  FINANCIAL CONDITION AND RESULTS OF
  OPERATION....................................   114
MANAGEMENT OF TRIARC...........................   121
    Executive Officers and Directors of
       Triarc..................................   121
    Certain Arrangements and Undertakings
       Relating to the Composition of the
       Triarc Board of Directors...............   124
    Information Regarding Certain Committees of
       the Triarc Board of Directors...........   125
    Compensation Committee Interlocks and
       Insider Participation...................   126
    Compensation of Directors..................   126
TRIARC EXECUTIVE COMPENSATION..................   127
OWNERSHIP OF TRIARC SECURITIES BY CERTAIN
  BENEFICIAL OWNERS AND MANAGEMENT.............   134
MANAGEMENT OF SEPSCO...........................   136
OWNERSHIP OF SEPSCO SECURITIES BY CERTAIN
  BENEFICIAL OWNERS AND MANAGEMENT.............   137
INFORMATION RELATING TO MERGERCO...............   139
CERTAIN RELATIONSHIPS AND RELATED
  TRANSACTIONS.................................   140
DESCRIPTION OF TRIARC CAPITAL STOCK............   145
    Triarc Common Shares.......................   145
    Redeemable Convertible Preferred Stock.....   145
    Triarc Serial Preferred Shares and Triarc
       Junior Preferred Shares.................   147
SUBMISSION OF STOCKHOLDER PROPOSALS FOR
  SEPSCO'S 1994 ANNUAL MEETING OF SEPSCO
  STOCKHOLDERS.................................   147
CERTAIN LEGAL MATTERS, EXPERTS AND REGULATORY
  APPROVALS....................................   147
    Federal and State Approvals................   147
    Legal Opinions.............................   147
    Experts....................................   148
    Delaware Business Combination Statute......   148
    Miscellaneous..............................   148
INDEX TO FINANCIAL STATEMENTS..................   F-1
ANNEX I -- MERGER AGREEMENT....................   A-1
ANNEX II -- OPINION OF SMITH BARNEY............   B-1
</TABLE>

 
                                       3

<PAGE>
     NO   PERSON  IS  AUTHORIZED  TO  GIVE   ANY  INFORMATION  OR  TO  MAKE  ANY
REPRESENTATIONS, OTHER THAN THOSE CONTAINED IN THIS PROXY  STATEMENT-PROSPECTUS,
IN  CONNECTION  WITH THE  OFFERING  MADE HEREBY,  AND,  IF GIVEN  OR  MADE, SUCH
INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED ON AS HAVING BEEN  AUTHORIZED.
THIS  PROXY  STATEMENT-PROSPECTUS DOES  NOT  CONSTITUTE AN  OFFER  TO SELL  OR A
SOLICITATION OF  AN OFFER  TO BUY  THE SECURITIES  TO WHICH  IT RELATES  IN  ANY
JURISDICTION  IN WHICH, OR TO ANY PERSON TO WHOM, IT IS UNLAWFUL TO MAKE SUCH AN
OFFER OR SOLICITATION. NEITHER THE  DELIVERY OF THIS PROXY  STATEMENT-PROSPECTUS
NOR  ANY OFFER OR SALE MADE HEREUNDER SHALL, UNDER ANY CIRCUMSTANCES, CREATE ANY
IMPLICATION THAT THERE HAS BEEN NO CHANGE IN INFORMATION SET FORTH HEREIN OR  IN
THE  AFFAIRS  OF  SEPSCO, TRIARC  OR  MERGERCO  OR ANY  OF  THEIR  AFFILIATES OR
SUBSIDIARIES FROM THE DATE HEREOF.
 
                             AVAILABLE INFORMATION
 

     Triarc  has  filed  with  the  Securities  and  Exchange  Commission   (the
'Commission')   a  registration   statement  on  Form   S-4  (the  'Registration
Statement'), of  which this  Proxy  Statement-Prospectus is  a part,  under  the
Securities  Act of 1933, as amended (the  'Securities Act'), with respect to the
Triarc Class A Common Stock.  As permitted by the  rules and regulations of  the
Commission,  this  Proxy  Statement-Prospectus  omits  certain  information  and
exhibits contained in the Registration Statement.

 
     SEPSCO and Triarc are subject to the information and reporting requirements
of the Securities Exchange Act of 1934, as amended (the 'Exchange Act'), and  in
accordance   therewith  file  periodic  reports,   proxy  statements  and  other
information with the  Commission. The  Registration Statement  and the  exhibits
thereto,  as well as such reports,  proxy statements and other information filed
by SEPSCO or  Triarc with the  Commission, can  be inspected and  copied at  the
public  reference facilities maintained  by the Commission  at 450 Fifth Street,
N.W., Washington, D.C. 20549, and at its regional offices at Northwestern Atrium
Center, 500 Madison Street, Suite 1400, Chicago, Illinois 60661-2511 and 7 World
Trade Center, New York, New York 10048. Copies of such material can be  obtained
from  the public reference section of the  Commission at 450 Fifth Street, N.W.,
Washington, D.C. 20549 upon payment of the prescribed fee.
 
     The SEPSCO Common Stock and SEPSCO's 11 7/8% Senior Subordinated Debentures
due February 1, 1998 (the '11 7/8% Debentures') are listed on the Pacific  Stock
Exchange  Incorporated  (the 'PSE').  Reports  and other  information concerning
SEPSCO should be available for inspection and copying at the offices of the  PSE
at 301 Pine Street, San Francisco, California 94104.
 
     If the Merger is consummated, the SEPSCO Common Stock will be delisted from
the  PSE and SEPSCO will take steps  to terminate the registration of the SEPSCO
Common Stock under  Section 12  of the Exchange  Act. See  'MARKET FOR  SEPSCO'S
COMMON EQUITY AND RELATED STOCKHOLDER MATTERS.' However, SEPSCO will be required
to  file periodic reports with the Commission so long as it has securities (such
as the 11 7/8% Debentures) registered under the Exchange Act.
 
     The Triarc  Class  A Common  Stock  is listed  on  the NYSE  and  the  PSE.
Application  will be made to list the additional shares of Triarc Class A Common
Stock to be issued in  connection with the Merger  for trading on each  exchange
located in the United States of America on which shares of Triarc Class A Common
Stock  are listed.  Reports and  other information  concerning Triarc  should be
available for inspection  and copying at  the offices  of the NYSE  at 20  Broad
Street, New York, New York 10005, and the PSE at 301 Pine Street, San Francisco,
California  94104. Such reports and other  information may also be obtained from
Triarc in the manner specified in 'INFORMATION INCORPORATED BY REFERENCE.'
 
                                       4
 
<PAGE>
                     INFORMATION INCORPORATED BY REFERENCE
 
     THIS PROXY STATEMENT-PROSPECTUS INCORPORATES  BY REFERENCE DOCUMENTS  WHICH
ARE  NOT PRESENTED HEREIN  OR DELIVERED HEREWITH. COPIES  OF ANY SUCH DOCUMENTS,
OTHER THAN EXHIBITS TO SUCH DOCUMENTS UNLESS THEY ARE SPECIFICALLY  INCORPORATED
BY  REFERENCE,  ARE  AVAILABLE  WITHOUT  CHARGE  TO  ANY  PERSON,  INCLUDING ANY
BENEFICIAL OWNER,  TO WHOM  THIS PROXY  STATEMENT-PROSPECTUS IS  DELIVERED  UPON
WRITTEN  OR ORAL REQUEST TO: CURTIS S. GIMSON, TRIARC COMPANIES, INC., 777 SOUTH
FLAGLER DRIVE,  WEST PALM  BEACH, FLORIDA  33401; TELEPHONE  (407) 653-4000.  IN
ORDER  TO ENSURE TIMELY DELIVERY OF THE DOCUMENTS, ANY REQUEST SHOULD BE MADE BY
APRIL 4, 1994.
 
     The following documents filed with the Commission pursuant to Section 13 of
the  Exchange  Act  with  respect  to  Triarc  (File  No.  1-2207)  are   hereby
incorporated by reference into this Proxy Statement-Prospectus:
 
          1. Triarc's Annual Report on Form 10-K for the fiscal year ended April
     30,  1993, as amended by an amendment  thereto filed with the Commission on
     August 30, 1993;
 
          2. Triarc's Quarterly  Reports on  Form 10-Q for  the fiscal  quarters
     ended July 31, 1993 and October 31, 1993;
 
          3.  Triarc's  Current  Reports  on  Form  8-K  dated  April  23, 1993,
     September 13, 1993, October  15, 1993, October 27,  1993, and November  22,
     1993; and
 
          4.  The description of Triarc's Class  A Common Stock contained in the
     registration statement  on Form  8-A dated  November 2,  1993, filed  under
     Section 12 of the Exchange Act, including any amendment or report filed for
     the purpose of updating such description.
 
     All  documents filed by  Triarc's with the  Commission pursuant to Sections
13(a), 13(c), 14 and 15(d) of the  Exchange Act after the date hereof and  prior
to  the  date of  the  Special Meeting  shall be  deemed  to be  incorporated by
reference herein.
 
     On October 27, 1993, Triarc announced that it would change its fiscal  year
from  a  year ending  April 30  to a  year ending  December 31,  commencing with
December 31, 1993. Accordingly,  on or before March  31, 1994, Triarc will  file
with  the  Commission a  transition report  on Form  10-K for  the period  May 1
through December  31,  1993  (such  period  being  hereinafter  referred  to  as
'Transition 1993').
 
     Any  statement  contained  in  a  document  incorporated  or  deemed  to be
incorporated by reference herein  shall be deemed to  be modified or  superseded
for  purposes hereof to the extent that  a statement contained herein (or in any
other subsequently filed  document which also  is incorporated or  deemed to  be
incorporated  by reference  herein) modifies  or supersedes  such statement. Any
statement so modified  or superseded shall  not be deemed  to constitute a  part
hereof except as so modified or superseded.
 
     All  information appearing in this  Proxy Statement-Prospectus is qualified
in its entirety  by the  information and financial  statements (including  notes
thereto)  appearing  in  the  documents  incorporated  herein  or  deemed  to be
incorporated herein by reference.
 
                                       5

<PAGE>

                      LIST OF CERTAIN DEFINED TERMS
<TABLE>
DEFINED TERM                                      PAGE
- -----------------------------------------------   ----
<S>                                               <C>
 
AFA............................................    79
AFC............................................    24
AFC Exchange Agreement.........................    24
AIG............................................    90
Apartment......................................   128
APL............................................   101
APL Committee..................................   143
APL Complaint..................................   143
APL Proceedings................................   143
Arby's.........................................     8
ARCOP..........................................    79
ASE............................................    15
Asplundh.......................................    97
Avery..........................................   121
Bank Loan......................................   129
Book Value Adjustment..........................   119
Brilliant......................................    91
C.H. Patrick...................................     8
Cameon.........................................    91
Carson Employment Agreement....................   129
CEO Compensation...............................    36
Certificate....................................    46
CFC Holdings...................................     9
CFC Holdings Agreements........................   140
Change in Control..............................    99
Chesapeake Insurance...........................    89
Citibank.......................................   135
Citibank Loans.................................   135
Closing Date...................................   117
Cold Storage Business..........................     9
Commission.....................................     4
Complaint......................................    12
Completed Transactions.........................    36
Consulting Agreement...........................    23
Control Agreement..............................    50
Conversion Price...............................   146
Cost Sharing Arrangements......................   141
Cott...........................................     8
Cott Worldwide Agreement.......................    19
Counsel Notes..................................    26
Court Appointed Directors......................   124
Current Annual Premiums........................    52
Current Cott Agreement.........................    19
Custodial Loans................................   135
Defendants.....................................     2
DGCL...........................................     1
DHEC...........................................    88
Discontinued Operations Plan...................     9
District Court.................................     2
D&O Insurance Coverage.........................    52
DWG Acquisition................................    10
Early Termination Payment......................   142
EBIT...........................................    34
EBITDA.........................................    34
Effective Period...............................   125
Effective Time.................................     1
Ehrman Claims..................................    30
Ehrman Litigation..............................     2
Employment Agreements..........................   130
<CAPTION>
DEFINED TERM                                      PAGE
- -----------------------------------------------   ----
<S>                                               <C>
Equitable Bag..................................   122
Equity Participation Plan......................    50
Equity Transactions............................    10
Exchange Act...................................     4
Exchange Agent.................................    11
FDA............................................    87
Final Order....................................    13
Finance Committee..............................    49
First Boston...................................   122
Fiscal.........................................     8
Fiscal 1993....................................    99
Florida Property...............................   129
Former Affiliates..............................   141
Former Cost Sharing Arrangements...............   141
Former Management Services Agreement...........   141
Fractional Shares..............................    47
GATT...........................................    20
Granada........................................    91
Graniteville...................................     8
Graniteville Credit Facility...................    24
greige goods...................................    80
Hearing........................................    28
Holdings Common Stock..........................   140
House..........................................    49
Ice Business...................................     9
Indemnified Parties............................    52
Indenture......................................   110
IRM............................................    35
IRS............................................   108
January Memorandum.............................    15
July Resolution................................     9
Kingsmore Employment Agreement.................   130
Landlord.......................................   142
Lease..........................................   142
Lease Modification.............................   142
Leased Space...................................   142
Letter of Intent...............................     9
LIBOR Rate.....................................   107
LP gas.........................................    83
LP Gas Companies...............................     8
Merger.........................................     1
Merger Agreement...............................     1
Mergerco.......................................     1
Merger Consideration...........................     2
Mergerco Common Stock..........................    46
Merrill Lynch/DLJ Investors....................    23
Minority Share Acquisitions....................   140
Modification...................................    91
Mountleigh.....................................   122
MTCIP..........................................   128
Mutual Fire....................................    90
NAFTA..........................................    20
Named Officers.................................   127
National Propane...............................     8
Note...........................................   117
Notice.........................................    27
NPC Leasing....................................   142
NVF............................................    30
</TABLE>

                                       6
 
<PAGE>

<TABLE>
<CAPTION>
DEFINED TERM                                      PAGE
- -----------------------------------------------   ----
<S>                                               <C>
NVF Proceedings................................   109
NYSE...........................................     1
Ohio Court.....................................    91
Original Stipulation...........................    91
OSHA...........................................    88
PDER...........................................   113
PEC............................................   103
Pierce Employment Agreement....................   129
Plaintiff......................................     2
Pledged Shares.................................   135
Posner.........................................    10
Posner Entities................................    10
PPM Corp.......................................    96
Preliminary Order..............................    27
Public Gas.....................................     8
Public Stockholder.............................    12
Purchase Price.................................   135
PSE............................................     4
QSR............................................    77
RC/Arby's......................................    12
RC/Arby's Refinancing..........................    12
RC Cola........................................     8
Record Date....................................     1
Redeemable Convertible Preferred Stock.........    15
Refinancing....................................    10
Registration Statement.........................     4
Reincorporation................................    55
Released Persons...............................     2
Relocation Agreement...........................   129
Remediation Plan...............................    97
Reorganization.................................    10
Republic Loans.................................   135
Required Stockholder Vote......................     2
Restructuring..................................    10
Revolving Loan.................................   107
RICO...........................................    12
Rights.........................................    50
Salem..........................................   141
S&P 500 Index..................................    48
SARs...........................................   126
Securities Act.................................     4
Section 262....................................     1
Senate.........................................    49
SEPSCO.........................................     1
SEPSCO Board...................................     1
SEPSCO By-Laws.................................    54
SEPSCO Certificate of Incorporation............    54
SEPSCO Common Stock............................     1
SEPSCO Comparable Companies....................    34
SEPSCO Fiscal 1993.............................   114
SEPSCO Preferred Stock.........................     1
SEPSCO Pro Forma Balance Sheet.................    42
SEPSCO Pro Forma Financial Statements..........    42
SEPSCO Pro Forma Statements of Operations......    42
<CAPTION>
DEFINED TERM                                      PAGE
- -----------------------------------------------   ----
<S>                                               <C>
SEPSCO Special Committee.......................    11
SEPSCO Stockholder.............................     1
SEPSCO Transition 1993.........................    62
SEPSCO Voting Stock............................     1
September Memorandum...........................    15
Settlement Agreement...........................     2
Settlement Condition...........................    48
Settlement Note................................    26
Settlement Terms and Conditions................     2
SFAS...........................................   101
SFAS 106.......................................   101
SFAS 109.......................................   101
Smith Barney...................................    12
SMC............................................    35
Southwestern Ice...............................     9
Special Meeting................................     1
Step-Up Notes..................................    24
Stock Purchase Agreement.......................   124
Surviving Corporation..........................     1
Target Companies...............................    34
TASCO..........................................   144
TASCO Fee......................................   144
Term Loan......................................   107
TIN............................................    54
Transition 1993................................     5
Trian..........................................   121
Triangle.......................................   121
Triarc.........................................     1
Triarc Articles................................    54
Triarc Board...................................    20
Triarc Capital Stock...........................   145
Triarc Class A Common Stock....................     1
Triarc Class B Common Stock....................    23
Triarc Common Shares...........................    50
Triarc Companies...............................     8
Triarc Companies Pro Forma Balance Sheet.......    36
Triarc Companies Pro Forma Financial
  Statements...................................    36
Triarc Companies Pro Forma Statements of
  Operations...................................    36
Triarc Comparable Companies....................    34
Triarc Junior Serial Preferred Stock...........    55
Triarc Notes...................................    24
Triarc Preferred Stock.........................   145
Triarc Regulations.............................    54
Triarc Serial Preferred Stock..................    55
Triarc Special Committee.......................    91
Undertaking....................................   125
Ways and Means Committee.......................    49
Wilson Brothers................................    68
Wright & Lopez.................................    96
9 3/4% Senior Notes............................    24
11 7/8% Debentures.............................     4
13 1/8% Debentures.............................   109
16 7/8% Debentures.............................    41
</TABLE>

 
                                       7

<PAGE>
                                    SUMMARY
 
     The following summary is qualified in its entirety by reference to the more
detailed  information and the financial statements (including the notes thereto)
appearing elsewhere  in  this  Proxy  Statement-Prospectus  or  incorporated  by
reference   herein.   SEPSCO  Stockholders   are  urged   to  read   this  Proxy
Statement-Prospectus and  the  Annexes  hereto in  their  entirety.  Unless  the
context otherwise requires, all references in this Proxy Statement-Prospectus to
'Triarc Companies' refer to Triarc and its consolidated subsidiaries. On October
27,  1993, Triarc announced that it was changing its fiscal year end to December
31 effective for the transition period ended December 31, 1993 and that each  of
its subsidiaries that did not then have a December 31 fiscal year end, including
SEPSCO,  would also change its fiscal year  end to December 31 effective for the
transition period  ended  December 31,  1993.  Unless otherwise  indicated,  (i)
references  herein to  financial information  of Triarc's  subsidiaries refer to
such financial information as reflected in the Consolidated Financial Statements
of Triarc and subsidiaries  (see Note 1 to  the Notes to Consolidated  Financial
Statements  of  Triarc  Companies,  Inc.  and  Subsidiaries  included  elsewhere
herein), and (ii)  references herein  to a year  preceded by  the word  'Fiscal'
refer  to the twelve months ended April 30 of such year. SEPSCO STOCKHOLDERS ARE
ESPECIALLY URGED TO READ THE SECTION ENTITLED 'SPECIAL FACTORS' FOR A DISCUSSION
OF CERTAIN SPECIAL FACTORS RELATING TO THE MERGER AND AN INVESTMENT IN TRIARC.
 
                        PARTIES TO THE MERGER AGREEMENT
 
TRIARC COMPANIES
 
     Triarc Companies is engaged in four core businesses: soft drink, fast food,
textiles and liquefied petroleum  gas. The soft  drink operations are  conducted
through  Royal Crown Company, Inc., formerly known as Royal Crown Cola Co., Inc.
('RC Cola');  the  fast  food  operations are  conducted  through  Arby's,  Inc.
('Arby's');  the textile  operations are conducted  through Graniteville Company
('Graniteville'); and  the  liquefied  petroleum gas  operations  are  conducted
through  National Propane Corporation ('National  Propane') and its subsidiaries
and Public Gas Company ('Public Gas'), a subsidiary of SEPSCO (National  Propane
and  its subsidiaries and Public Gas are  collectively referred to herein as the
'LP Gas Companies').
 
     RC Cola produces and sells soft  drink concentrates used in the  production
and distribution of soft drinks by independent bottlers under the brand names RC
COLA,  DIET RC COLA, DIET RITE COLA, DIET RITE flavors, NEHI, UPPER 10 and KICK.
RC Cola is the third largest national brand cola and is the only national  brand
cola alternative available to non-Coca-Cola and non-Pepsi-Cola bottlers. RC Cola
is  also  the  exclusive  supplier  of  proprietary  cola  concentrate  to  Cott
Corporation ('Cott'), which sells private  label soft drinks to major  retailers
such as Wal-Mart, A&P and Safeway.
 
     Arby's  is the world's largest  franchise restaurant system specializing in
roast beef sandwiches with  an estimated market  share in 1993  of 65.1% of  the
roast  beef  sandwich  segment  of  the  quick-service  restaurant  category. In
addition, Triarc Companies believes that  Arby's is the 14th largest  restaurant
chain in the United States, based on domestic system-wide sales. Worldwide sales
for  the  Arby's  system were  approximately  $1.5  billion in  Fiscal  1993 and
approximately $1.1  billion  during  Transition  1993. Arby's  acts  both  as  a
franchisor  and  as  an owner  and  operator  in a  system  that  included 2,682
restaurants as of December 31, 1993, of which 259 were company-owned.
 
     Graniteville manufactures, dyes and finishes cotton, synthetic and  blended
(cotton  and  polyester)  apparel  fabrics.  Graniteville  produces  fabrics for
utility wear  including  uniforms  and other  occupational  apparel,  piece-dyed
fabrics  for  sportswear, casual  wear  and outerwear,  indigo-dyed  fabrics for
jeans,  sportswear  and  outerwear  and  specialty  fabrics  for   recreational,
industrial  and  military  end-uses.  Through  a  wholly-owned  subsidiary, C.H.
Patrick & Co.,  Inc. ('C.H.  Patrick'), Graniteville also  produces and  markets
dyes and specialty chemicals primarily to the textile industry. Triarc Companies
believes  that Graniteville  is a leading  domestic manufacturer  of fabrics for
utility wear, piece-dyed fabrics for  sportswear, casual wear and outerwear  and
indigo-dyed fabrics used in the production of high-end fashion apparel.
 
     Triarc  Companies  believes  the LP  Gas  Companies are  the  fifth largest
distributors of liquefied petroleum  gas in terms of  unit volume in the  United
States.  This business is conducted by approximately 156 operating units located
in 20 states in  the Southeast, Northeast, Midwest  and Southwest, primarily  in
suburban and rural areas.
 
                                       8
 
<PAGE>
     Set  forth on page 69 is an organizational chart which shows Triarc and its
principal subsidiaries and indicates the  current percentage of the  outstanding
common   equity  which  Triarc  owns,  directly  or  indirectly,  in  each  such
subsidiary. Triarc,  through  a  number of  direct  and  indirect  subsidiaries,
including SEPSCO, is also currently engaged in a variety of non-core businesses,
substantially  all of which it  intends to dispose of  or discontinue as part of
its business  strategy.  Triarc  was  incorporated in  Ohio  in  1929.  Triarc's
principal  executive offices are  located at 777 South  Flagler Drive, West Palm
Beach, Florida 33401, and its telephone number is (407) 653-4000. See  'BUSINESS
OF TRIARC COMPANIES.'
 
SEPSCO
 

     SEPSCO,  directly  and through  its  subsidiaries, currently  provides cold
storage warehouse facilities  and manufactures  and sells  ice; distributes  and
sells  liquefied petroleum gas; and has working and royalty interests in natural
gas and  oil  producing properties.  SEPSCO  also holds  minority  interests  in
several Triarc subsidiaries, including a 49% interest in Graniteville and a 5.4%
interest  in CFC Holdings Corp. ('CFC Holdings'), the indirect parent of RC Cola
and Arby's.  In July  1993, the  SEPSCO Board  adopted a  resolution (the  'July
Resolution')  calling for the sale or discontinuance of substantially all of its
operating businesses and  assets, other  than its minority  equity interests  in
other  Triarc subsidiaries. The actions contemplated  by the July Resolution are
referred to  herein as  the  'Discontinued Operations  Plan.' In  October  1993,
SEPSCO  completed three  transactions in which  it disposed  of businesses which
provide a  variety  of  services  to  electrical  and  telephone  utilities  and
municipalities,  which  businesses formerly  constituted SEPSCO's  utilities and
municipal services segment. On  November 12, 1993,  SEPSCO and Southwestern  Ice
Inc. ('Southwestern Ice') signed a letter of intent (the 'Letter of Intent') for
the  sale by SEPSCO  to Southwestern Ice  of substantially all  of the operating
assets of the ice  manufacturing and distribution  portion of its  refrigeration
services and products businesses (the 'Ice Business') for $5 million in cash and
approximately  $4 million principal amount of  subordinated secured notes due on
the fifth anniversary of the sale and the assumption by the purchaser of certain
current liabilities. The Letter of Intent, by its terms, expired on January  11,
1994,  although the parties are still continuing discussions with respect to the
transaction contemplated by the Letter of Intent. Completion of the  transaction
contemplated  by the  Letter of  Intent is  subject to  a number  of significant
conditions and  no  assurance  can  be  given  that  such  transaction  will  be
consummated. Triarc and SEPSCO have agreed in principle to the sale by SEPSCO to
Triarc  of the stock of  the SEPSCO subsidiaries that  hold SEPSCO's natural gas
and oil working and royalty interests. Such sale will be for a net cash purchase
price of $8.5 million, will be consummated on or before July 22, 1994 and is not
contingent upon  the consummation  of the  Merger. See  'BUSINESS OF  SEPSCO  --
Recent  Transactions'  and 'CERTAIN  RELATIONSHIPS  AND RELATED  TRANSACTIONS --
Certain Other Transactions.' Triarc has indicated that following the Merger,  in
connection  with the Discontinued Operations Plan, it intends to cause SEPSCO to
transfer the liquefied petroleum gas  business conducted by SEPSCO's Public  Gas
subsidiary  to  National Propane.  Assuming  that the  Ice  Business is  sold to
Southwestern Ice  as contemplated  by the  Letter of  Intent and  the  transfers
described  in the two  immediately preceeding sentences  have occurred, the only
SEPSCO business  remaining  to  be  disposed of  pursuant  to  the  Discontinued
Operations  Plan is the nationwide cold storage and warehouse facilities portion
of SEPSCO's refrigeration  products and services  businesses (the 'Cold  Storage
Business').  No agreements  have been  entered into as  of the  date hereof with
respect to  the  Cold  Storage  Business  and  the  precise  timetable  for  the
disposition  of such business  will depend upon SEPSCO's  ability to identify an
appropriate purchaser and to negotiate acceptable terms of sale. Although SEPSCO
currently anticipates completing  the sale of  that business by  July 31,  1994,
there  can be  no assurance  that SEPSCO will  be successful  in completing such
sale. Some or all of the net proceeds from the sale by SEPSCO of its  businesses
may  be used to repurchase, redeem  or prepay SEPSCO's outstanding indebtedness,
including the indebtedness evidenced by the 11 7/8% Debentures.

 

     Triarc, through  a wholly-owned  subsidiary, currently  owns  approximately
71.1% of the outstanding shares of SEPSCO Common Stock and directly owns 100% of
the  outstanding shares of SEPSCO Preferred Stock. If the Merger is consummated,
SEPSCO will be a wholly owned  subsidiary of Triarc. SEPSCO was incorporated  in
Delaware  in 1947. SEPSCO's principal executive offices are located at 777 South
Flagler Drive, Suite 1000E,  West Palm Beach, Florida  33401, and its  telephone
number is (407) 653-4000. See 'BUSINESS OF SEPSCO.'

 
                                       9
 
<PAGE>
MERGERCO
 
     Mergerco  was organized by  Triarc in September 1993  under Delaware law in
order to effect  the Merger. Mergerco  is a wholly  owned subsidiary of  Triarc.
Mergerco  has not  engaged in  any activities other  than those  incident to its
formation. If the Merger is consummated, Mergerco will be merged into SEPSCO and
will no longer exist. Mergerco's principal executive offices are located at  777
South Flagler Drive, West Palm Beach, Florida 33401, and its telephone number is
(407) 653-4000. See 'INFORMATION RELATING TO MERGERCO.'
 
NEW OWNERSHIP AND EXECUTIVE MANAGEMENT
 
     On  April  23, 1993,  DWG Acquisition  Group,  L.P. ('DWG  Acquisition'), a
Delaware limited  partnership, the  sole general  partners of  which are  Nelson
Peltz  and Peter  W. May,  acquired shares  of Triarc  common stock  from Victor
Posner ('Posner')  and  certain entities  controlled  by Posner  (together  with
Posner,  the 'Posner  Entities'), representing  approximately 28.6%  of Triarc's
then outstanding Common Stock. As a result  of such acquisition and a series  of
related   transactions   which  were   also  consummated   on  April   23,  1993
(collectively, the 'Equity  Transactions'), the Posner  Entities no longer  hold
any  shares of voting stock  of Triarc or any  of its subsidiaries. Concurrently
with  the  consummation  of  the  Equity  Transactions,  the  Triarc   Companies
refinanced  a  significant portion  of its  high  cost debt  in order  to reduce
interest costs and to provide additional funds for working capital and liquidity
purposes  (the  'Refinancing').  Following   the  consummation  of  the   Equity
Transactions  and the Refinancing, the Boards of Directors of each of Triarc and
SEPSCO installed a  new corporate management  team, headed by  Nelson Peltz  and
Peter  W.  May,  who  were  elected Chairman  and  Chief  Executive  Officer and
President  and  Chief  Operating   Officer  of  each   of  Triarc  and   SEPSCO,
respectively.  In addition, Leon  Kalvaria was elected Vice  Chairman of each of
Triarc and  SEPSCO.  The Triarc  Board  of Directors  also  approved a  plan  to
decentralize   and   restructure   the   Triarc   Companies'   management   (the
'Restructuring'). For a  more detailed description  of the Equity  Transactions,
the  Refinancing and the  Restructuring (collectively referred  to herein as the
'Reorganization'), see 'SPECIAL FACTORS -- Background to the Merger; Reasons for
the Merger -- The Reorganization and Related Matters.'
 
                              THE SPECIAL MEETING
 

     The Special Meeting will be held on Thursday, April 14, 1994, commencing at
12:00 noon local time, at the Palm Beach Airport Hilton, 150 Australian  Avenue,
West Palm Beach, Florida. Holders of record of shares of SEPSCO Common Stock and
shares of SEPSCO Preferred Stock at the close of business on the Record Date are
entitled to notice of and to vote at the Special Meeting.

 
     Each  outstanding share of SEPSCO Common  Stock entitles the holder thereof
to one  vote; each  outstanding share  of SEPSCO  Preferred Stock  entitles  the
holder  thereof to  one vote.  On the Record  Date, 11,655,067  shares of SEPSCO
Common Stock and  490 shares  of SEPSCO  Preferred Stock  were outstanding.  The
total voting power of outstanding shares of SEPSCO Voting Stock entitled to vote
at the Special Meeting is 11,655,557 votes.
 
     The  affirmative vote  of (i)  the holders  of at  least a  majority of the
outstanding shares  of SEPSCO  Voting  Stock entitled  to  vote at  the  Special
Meeting  (considered as a single class), (ii) the holders of at least two-thirds
of the outstanding  shares of  SEPSCO Preferred Stock  entitled to  vote at  the
Special Meeting, and (iii) the holders of at least two-thirds of the outstanding
shares of SEPSCO Voting Stock, other than those held by Triarc or any subsidiary
of  Triarc, entitled to  vote at the  Special Meeting, is  required to adopt the
Merger Agreement. Therefore, abstentions and broker non-votes will have the same
effect as votes against approval and adoption of the Merger.
 
     The Merger Agreement requires Triarc to vote, or cause to be voted, all  of
its  SEPSCO  Voting Stock  in favor  of  the adoption  of the  Merger Agreement.
Triarc, which directly and  through a wholly-owned subsidiary  owns and has  the
right  to vote  at the  Special Meeting  approximately 71.1%  of the outstanding
shares of  SEPSCO Voting  Stock and  100% of  the outstanding  shares of  SEPSCO
Preferred  Stock, controls a sufficient number  of shares of SEPSCO Common Stock
and SEPSCO Preferred Stock to cause the votes described in clauses (i) and  (ii)
above  to be obtained without the vote of any other SEPSCO Stockholder. HOWEVER,
THE OBTAINING OF THE  VOTE DESCRIBED IN CLAUSE  (III) ABOVE DEPENDS SOLELY  UPON
THE  VOTE OF SEPSCO  STOCKHOLDERS OTHER THAN  TRIARC AND CANNOT  BE ASSURED. See
'THE SPECIAL MEETING.'
 
                                       10
 
<PAGE>
                                   THE MERGER
 
TERMS OF THE MERGER
 
     The Merger Agreement provides for the  merger of Mergerco into SEPSCO  with
SEPSCO being the Surviving Corporation.
 
     At  the Effective Time,  (i) each outstanding share  of SEPSCO Common Stock
(other than  shares  of  SEPSCO  Common  Stock then  owned  by  Triarc  and  its
subsidiaries,  all of which will be cancelled) will, by virtue of the Merger and
without any action  on the part  of the  holder thereof, be  converted into  the
right to receive from Triarc 0.8 of a share of Triarc Class A Common Stock, (ii)
each  outstanding share of SEPSCO Preferred Stock  will, by virtue of the Merger
and without any  action on the  part of  the holder thereof,  be cancelled,  and
(iii)  SEPSCO will become a  wholly owned subsidiary of  Triarc. Pursuant to the
Merger Agreement, Triarc  will vote  all of the  shares of  SEPSCO Voting  Stock
owned  by  it in  favor  of the  Merger Agreement  and,  therefore, will  not be
entitled under Section 262 to exercise its appraisal rights with respect to  the
shares of SEPSCO Preferred Stock which it owns.
 
     Assuming  the  Merger  is consummated,  approximately  2,691,822  shares of
Triarc Class A  Common Stock  will be  issued in  the Merger.  Such shares  will
represent  approximately 11.2%  of the issued  and outstanding  shares of Triarc
Class A Common  Stock immediately  after giving effect  to the  issuance of  the
shares  of Triarc Class A Common Stock in the Merger. For information concerning
the capitalization of Triarc as  of October 31, 1993 on  an actual and on a  pro
forma basis to reflect the Merger, see 'TRIARC CAPITALIZATION.'
 
EXCHANGE OF SEPSCO COMMON STOCK FOR MERGER CONSIDERATION
 
     In  order to receive the Merger Consideration following the Effective Time,
each holder of a certificate  theretofore representing SEPSCO Common Stock  will
be  required to properly surrender his or her stock certificate, together with a
duly executed  and  properly  completed  letter of  transmittal  and  any  other
required  documents to Harris Trust Company of  New York, as Exchange Agent (the
'Exchange Agent').  The Exchange  Agent  will send  instructions to  holders  of
SEPSCO  Common Stock with regard to the procedure for surrendering certificates,
together with a letter of transmittal and any required documents, as promptly as
practicable after the Effective Time. Each holder of SEPSCO Common Stock  (other
than  Triarc and  its subsidiaries)  will receive  a number  of whole  shares of
Triarc Class A Common  Stock determined by multiplying  the number of shares  of
SEPSCO Common Stock owned by such stockholder at the Effective Time by 0.8. Such
holders  will be paid  cash in lieu of  any fractional shares  of Triarc Class A
Common Stock which they would otherwise be entitled to receive. See 'THE  MERGER
AGREEMENT -- Payment for SEPSCO Common Stock.'
 
     SEPSCO  STOCKHOLDERS  SHOULD  NOT  SEND  ANY  STOCK  CERTIFICATES  WITH THE
ENCLOSED PROXY CARD.
 
RECOMMENDATION OF THE SEPSCO BOARD
 
     On April 24,  1993, the  SEPSCO Board created  a special  committee of  the
SEPSCO Board composed of directors David E. Schwab II and Sir Ian MacGregor (the
'SEPSCO  Special Committee') for the purpose of reviewing, negotiating the terms
of, and reporting back to the full  SEPSCO Board as to its recommendations  with
respect to, any transaction proposed by Triarc in connection with the settlement
of  the Ehrman Litigation. The SEPSCO Special Committee was authorized to engage
such legal, financial and other advisers as the SEPSCO Special Committee  deemed
appropriate  in carrying  out its  assignment. Pursuant  to such  authority, the
SEPSCO Special Committee retained Smith Barney Shearson Inc. ('Smith Barney') to
act as its  financial adviser.  See 'SPECIAL  FACTORS --  Recommendation of  the
SEPSCO Special Committee and the SEPSCO Board.'
 
     After  considering all relevant information, including the opinion of Smith
Barney to the effect that the Merger Consideration to be received by the holders
of SEPSCO Common Stock (other than  Triarc and its affiliates) (each, a  'Public
Stockholder')  is fair,  from a  financial point of  view, to  such holders, the
SEPSCO Special Committee voted unanimously to  approve the terms of the  Merger.
Following  the  favorable recommendation  of the  SEPSCO Special  Committee, the
SEPSCO Board unanimously approved the  Merger Agreement and recommends that  the
SEPSCO  Stockholders vote  FOR adoption  of the  Merger Agreement.  See 'SPECIAL
FACTORS -- Recommendation of the SEPSCO Special Committee and the SEPSCO Board.'
 
                                       11
 
<PAGE>
     In considering the recommendation of the  SEPSCO Board with respect to  the
Merger,  SEPSCO stockholders  should be aware  that certain  members of SEPSCO's
management and of the SEPSCO Board have certain interests which may present them
with potential  conflicts of  interest in  connection with  the Merger.  Messrs.
Peltz  and May are Chairman and Chief  Executive Officer and President and Chief
Operating Officer,  respectively,  of  SEPSCO,  Triarc  and  Mergerco  and  Leon
Kalvaria  is the Vice Chairman of each  of SEPSCO, Triarc and Mergerco. Three of
SEPSCO's five  directors (Messrs.  Peltz and  May and  Leon Kalvaria)  are  also
directors  of  Triarc.  The  two  other  SEPSCO  directors  (Messrs.  Schwab and
MacGregor, who, as the only members of the SEPSCO Board who are not also  Triarc
directors, were designated members of the SEPSCO Special Committee to review the
merger  proposal from  Triarc) have  served as  directors of  other corporations
affiliated with Messrs. Peltz and May. All of Mergerco's directors are directors
of both Triarc and SEPSCO. Substantially all of the executive officers of Triarc
and  Mergerco   are   also   executive  officers   of   SEPSCO.   See   'SPECIAL
FACTORS -- Interests of Certain Persons in the Merger.'
 
     THE  SEPSCO BOARD UNANIMOUSLY RECOMMENDS  THAT SEPSCO STOCKHOLDERS VOTE FOR
                                                                             ---
ADOPTION OF THE MERGER AGREEMENT.
 
OPINION OF FINANCIAL ADVISOR
 
     On November  15,  1993,  Smith  Barney  delivered  to  the  SEPSCO  Special
Committee  its oral opinion,  confirmed by a written  opinion dated November 22,
1993, to the effect that, as of the respective dates and based upon and  subject
to certain matters as stated in its written opinion, the Merger Consideration to
be  received by the  holders of SEPSCO  Common Stock (other  than Triarc and its
affiliates) in the  Merger was fair,  from a  financial point of  view, to  such
holders.  The full text  of the November  22, 1993 Smith  Barney written opinion
setting forth  the assumptions  made,  matters considered  and scope  of  review
undertaken  in  connection  therewith is  attached  as  Annex II  to  this Proxy
Statement-Prospectus  and  should  be  read   in  its  entirety.  See   'SPECIAL
FACTORS -- Opinion of Financial Advisor.'
 
LEGAL PROCEEDINGS RELATED TO THE MERGER
 
     In  December 1990,  the Plaintiff  commenced the  Ehrman Litigation  in the
District Court. Although SEPSCO was named  as a nominal defendant in such  case,
the amended complaint, which was filed in April 1991 (the 'Complaint'), names as
defendants  Triarc, certain current  and former corporate  affiliates of Triarc,
and certain individuals who were,  at the time of  the actions described in  the
Complaint,  directors  of  SEPSCO  (including  two  persons  who  are  currently
directors of Triarc, Messrs. William L.  Pallot and Thomas A. Prendergast).  The
Complaint  alleges that the Defendants breached their fiduciary duties to SEPSCO
and RC/Arby's Corporation ('RC/Arby's'), the  parent corporation of RC Cola  and
Arby's,  formerly known as Royal Crown Corporation, by authorizing or permitting
certain  transactions  that   reduced  SEPSCO's  ownership   of  RC/Arby's   and
Graniteville  while increasing Triarc's  equity interest in  such companies. The
Complaint also alleged that SEPSCO's 1991 proxy statement violated Section 14 of
the Exchange Act by  failing to disclose certain  alleged material facts and  it
also  alleged  that the  Defendants  had engaged  in  a pattern  of racketeering
activity in violation of the Racketeer Influenced and Corrupt Organizations  Act
of  1970 ('RICO'). See 'SPECIAL FACTORS -- Background of the Merger; the Reasons
for the Merger;  -- Legal Proceedings Related to SEPSCO and Triarc.'
 
     On October 18,  1993, the  parties to  the Ehrman  Litigation executed  the
Settlement  Agreement containing the following  Settlement Terms and Conditions:
(1) dismissal  on  the  merits  and with  prejudice  of  the  Ehrman  Litigation
resulting  in a final adjudication  on the merits of  any and all claims against
the Defendants that Plaintiff, SEPSCO or any of the Public Stockholders have  or
could  have asserted in the  Ehrman Litigation or in any  other action or in any
other court relating to any of the acts, facts, transactions, omissions or other
subject matters  set forth,  embraced or  otherwise referred  to in  the  Ehrman
Litigation,  the Complaint  or the  Settlement Agreement,  and (2)  agreement by
Triarc that after the Settlement Agreement  becomes final, it will cause  SEPSCO
to be merged with or otherwise acquired by Triarc, or an affiliate or subsidiary
of  Triarc, in a transaction  in which each Public  Stockholder would receive in
exchange for each share of SEPSCO  Common Stock held by such Public  Stockholder
0.8  of  a  share of  Triarc  Class A  Common  Stock. The  Settlement  Terms and
Conditions also provide that Triarc will pay the reasonable fees and expenses of
Plaintiff's counsel and investment
 
                                       12
 
<PAGE>
banker, as may be  awarded by the  District Court, and  include an agreement  by
Triarc  and the other Defendants not to  object to an application by Plaintiff's
counsel for fees  and expenses  in an  amount not  to exceed  $1,250,000 and  to
payment  of Plaintiff's investment  banker's fees and expenses  in amount not to
exceed $50,000.
 
     On January 11, 1994,  the District Court held  a hearing on the  Settlement
Agreement  and entered an  Order and Final Judgment  (a 'Final Order') approving
the Settlement Terms and  Conditions and the  Plaintiff's application for  legal
and investment banking fees and expenses aggregating $1.3 million.
 
     The  terms  of the  Merger  are consistent  with  the Settlement  Terms and
Conditions. The entry by the District Court of the Final Order approving,  among
other  things,  the  Settlement  Terms  and  Conditions  satisfied  one  of  the
conditions to the obligations of Triarc,  Mergerco and SEPSCO to consummate  the
Merger. See 'THE MERGER AGREEMENT -- Conditions to the Merger.'
 

     If  the Merger is not consummated,  the Settlement Agreement will not enter
into effect and will be deemed null and void ab initio and the rights and duties
of the parties to the Ehrman Litigation will revert, without prejudice, to their
respective  status  immediately  prior  to  the  execution  of  the   Settlement
Agreement.  Upon the  occurrence of  such event, and  if no  other settlement or
resolution of the  Ehrman Litigation is  reached, Triarc has  indicated that  it
will vigorously defend itself against the allegations contained in the complaint
filed by the Plaintiff in the Ehrman Litigation.

 

     For  more information concerning  the Ehrman Litigation  and the Settlement
Agreement, see 'SPECIAL  FACTORS -- Background  to the Merger;  Reasons for  the
Merger -- Legal Proceedings Related to SEPSCO and Triarc.'

 
RISK FACTORS
 
     STOCKHOLDERS ARE URGED TO READ THE SECTION APPEARING FOLLOWING THIS SUMMARY
ENTITLED  'RISK FACTORS'  FOR A  DISCUSSION OF  CERTAIN RISKS  AND OTHER FACTORS
RELATING TO THE MERGER AND TO AN INVESTMENT IN TRIARC.
 
APPRAISAL RIGHTS
 
     Only holders of record of shares  of SEPSCO Preferred Stock have the  right
to  dissent from the  Merger and seek  an appraisal of  their shares pursuant to
Section 262. HOLDERS OF SHARES  OF SEPSCO COMMON STOCK  DO NOT HAVE SUCH  RIGHTS
WITH  RESPECT  TO  THEIR  SHARES  OF  SEPSCO  COMMON  STOCK.  Triarc  holds  all
outstanding shares of  SEPSCO Preferred Stock  and has agreed  to vote all  such
shares for the adoption of the Merger Agreement and, therefore, will not be able
to exercise its rights under Section 262.
 
FEDERAL INCOME TAX CONSEQUENCES OF THE MERGER TO PUBLIC STOCKHOLDERS
 
     Generally,  the exchange  of shares  of SEPSCO  Common Stock  for shares of
Triarc Class  A Common  Stock will  constitute a  taxable exchange  for  federal
income tax purposes. As a result, a holder of SEPSCO Common Stock will recognize
gain or loss on the exchange of SEPSCO Common Stock for shares of Triarc Class A
Common  Stock measured by the difference between such stockholder's tax basis in
such shares of SEPSCO Common  Stock and the fair market  value of the shares  of
Triarc  Class A Common Stock received with respect thereto. See 'CERTAIN FEDERAL
INCOME TAX CONSEQUENCES OF THE MERGER.'
 
PURPOSE, STRUCTURE AND CERTAIN EFFECTS OF THE MERGER
 
     The purpose of the  Merger is for  Triarc to acquire  the shares of  SEPSCO
Common  Stock held by the Public  Stockholders in accordance with the Settlement
Terms and Conditions  contained in the  Settlement Agreement. If  the Merger  is
consummated, SEPSCO will become a wholly owned subsidiary of Triarc. As a result
of  the Merger, the SEPSCO  Common Stock would be delisted  from the PSE and the
registration of the SEPSCO Common Stock under the Exchange Act would  terminate.
Stockholders of SEPSCO would become stockholders of Triarc, SEPSCO's parent. See
'SPECIAL FACTORS -- Certain Effects of the Merger and Related Transactions.'
 
                                       13
 
<PAGE>
REGULATORY APPROVALS
 
     No  federal or state regulatory requirements  remain to be complied with in
order to  consummate  the  Merger.  See  'CERTAIN  LEGAL  MATTERS,  EXPERTS  AND
REGULATORY  APPROVALS.' However, the obligations  of Triarc, Mergerco and SEPSCO
to consummate  the Merger  are subject  to  satisfaction of  a number  of  other
conditions. See 'THE MERGER AGREEMENT -- Conditions to the Merger.'
 
PLANS FOR SEPSCO AFTER THE MERGER
 
     Triarc has indicated that SEPSCO's Discontinued Operations Plan will not be
affected  by the Merger and accordingly, following the Merger, Triarc intends to
cause SEPSCO to (i) continue with plans  to dispose of its Ice Business and  its
Cold  Storage  Business, to  the extent  not theretofore  disposed of,  and (ii)
transfer the liquefied petroleum gas business of SEPSCO's Public Gas  subsidiary
to  National Propane, although the precise method by which such business will be
transferred has  not yet  been  determined. Triarc  and  SEPSCO have  agreed  in
principle  to  the  sale  by  SEPSCO  to  Triarc  of  the  stock  of  the SEPSCO
subsidiaries that  hold  SEPSCO's  natural  gas  and  oil  working  and  royalty
interests. Such sale will be for a net cash purchase price of $8.5 million, will
be  consummated  on or  before  July 22,  1994 and  is  not contingent  upon the
consummation of the Merger. See 'SPECIAL  FACTORS -- Conduct of the Business  of
the Surviving Corporation After the Merger.'
 
ACCOUNTING TREATMENT OF THE MERGER
 
     Triarc will account for the Merger as a step acquisition in accordance with
the  purchase method of accounting and,  accordingly, the additional interest in
the assets acquired and the additional interest in the liabilities assumed  will
be  recorded at  their fair  values (which  they currently  approximate) and the
minority interest in SEPSCO will be eliminated as of the date of the Merger. The
excess of the purchase price over the  fair value of the additional interest  in
the  net assets  acquired will  be amortized  on a  straight-line basis  over 30
years.
 
MARKET PRICES FOR THE SEPSCO COMMON STOCK AND THE TRIARC CLASS A COMMON STOCK
 
     The PSE is  the principal  market on which  SEPSCO Common  Stock is  traded
(symbol:  SPV). The NYSE is the principal  market on which Triarc Class A Common
Stock is traded (symbol: TRY). The Triarc Class A Common Stock is also traded on
the PSE.
 
     Set forth below are the  closing sale prices for  a share of SEPSCO  Common
Stock  and for a share of  Triarc Class A Common Stock,  each as reported on the
consolidated transaction  reporting  system, on  each  of the  following  dates:
September  1, 1992, the last full business day preceding the public announcement
that a letter of intent had been entered into by Triarc, the Posner Entities and
an affiliate  of DWG  Acquisition which  contemplated the  several  transactions
ultimately  resulting  in DWG  Acquisition becoming  the largest  stockholder of
Triarc and the Posner Entities selling  their interests in the Triarc  Companies
for  cash and  non-voting shares  of Triarc's  cumulative convertible redeemable
preferred stock, par value $.10 per share (the 'Redeemable Convertible Preferred
Stock'); January  20, 1993,  the last  full business  day preceding  the  public
announcement that DWG Acquisition and the Plaintiff in the Ehrman Litigation had
entered  into a Memorandum of Understanding dated January 21, 1993 (the 'January
Memorandum') with respect  to a  proposed settlement of  the Ehrman  Litigation,
which terms, although different in certain material respects from the Settlement
Terms  and  Conditions, contemplated  that DWG  Acquisition  would use  its best
efforts following  the  Reorganization to  cause  Triarc to  settle  the  Ehrman
Litigation  through the  acquisition by  Triarc of  the shares  of SEPSCO Common
Stock held by the  Public Stockholders; April 22,  1993, the last full  business
day  preceding the  Reorganization; September  10, 1993,  the last  business day
preceding the public announcement that Triarc and the Plaintiff had entered into
a  Memorandum  of  Understanding  dated  September  13,  1993  (the   'September
Memorandum')  which superseded  the January  Memorandum and  which provided that
Triarc would use  its best efforts  to cause  the Defendants to  enter into  the
Settlement  Agreement; October 15, 1993, the last business day preceding the day
on which Triarc announced that the parties to the Ehrman Litigation had executed
the   Settlement   Agreement;   November    19,   1993,   the   last    business
 
                                       14
 
<PAGE>
day  preceeding the  day on  which Triarc and  SEPSCO announced  that the Merger
Agreement had been executed; and March 10, 1994.
 
<TABLE>
<CAPTION>
                                                                              CLOSING SALE PRICE
                                                                         -----------------------------
                                                                            SEPSCO       TRIARC CLASS A
                                                                         COMMON STOCK     COMMON STOCK*
                                                                         ------------    -------------
<S>                                                                      <C>             <C>
September 1, 1992.....................................................   $  6 7/8        $  11
January 20, 1993......................................................     14 1/4           15 5/8
April 22, 1993........................................................     15 1/4           19 5/8
September 10, 1993....................................................     23               31 5/8
October 15, 1993......................................................     22 3/4           30 1/8
November 19, 1993.....................................................     21 3/8           27 3/4
March 10, 1994........................................................
</TABLE>
 
- ------------
 
*  Prior to  April 23,  1993, Triarc  had only  one authorized  class of  common
   stock.  On April 23,  1993, in connection with  the Reorganization, each then
   outstanding share of Triarc common stock was converted into a share of Triarc
   Class A Common  Stock. Prior  to November  17, 1993,  the date  on which  the
   Triarc  Class A Common Stock began trading  on the NYSE, the principal market
   for the Triarc  Class A Common  Stock was the  American Stock Exchange,  Inc.
   (the 'ASE').
 
- ----------------------------------------------------------
     For  information relating to  historical market prices  of and dividends on
the SEPSCO Common Stock  and the Triarc  Class A Common  Stock, see 'MARKET  FOR
SEPSCO'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS' and 'MARKET FOR TRIARC'S
COMMON  EQUITY AND RELATED STOCKHOLDER MATTERS.'  Holders of SEPSCO Common Stock
are urged to obtain current quotations for such securities.
 
                                       15

<PAGE>
                    TRIARC COMPANIES, INC. AND SUBSIDIARIES
                        SUMMARY FINANCIAL INFORMATION(1)
<TABLE>
<CAPTION>
                                                                                                                       SIX
                                                                                                                      MONTHS
                                                                                                                      ENDED
                                                                                                                     OCTOBER
                                                               FISCAL YEAR ENDED APRIL 30,                             31,
                                       ---------------------------------------------------------------------------   --------
                                                                                                      PRO FORMA(2)
                                         1989        1990         1991         1992         1993          1993         1992
                                       --------   ----------   ----------   ----------   ----------   ------------   --------
                                                              (IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
<S>                                    <C>        <C>          <C>          <C>          <C>          <C>            <C>
OPERATING DATA:
    Revenues.........................  $987,730   $1,038,923   $1,027,162   $1,074,703   $1,058,274    $1,058,274    $522,371
    Operating profit.................    45,123       61,130       23,304       58,552       34,459        30,191      32,129
    Loss from continuing
      operations.....................    (5,851)     (13,966)     (17,501)     (10,207)     (44,549)      (50,114)     (4,398)
    Discontinued operations, net.....     3,250        1,072          (55)       2,705       (2,430)                    2,016
    Extraordinary items, net.........     1,807        1,363          703       --           (6,611)                    --
    Cumulative effect of changes in
      accounting principles, net.....     --          --           --           --           (6,388)                   (6,388)
    Net loss.........................      (794)     (11,531)     (16,853)      (7,502)     (59,978)                   (8,770)
    Preferred stock dividend
      requirements...................      (580)         (14)         (11)         (11)        (121)                       (5)
    Net loss applicable to common
      stockholders(3)................    (1,374)     (11,545)     (16,864)      (7,513)     (60,099)                   (8,775)
    Loss per share:
        Continuing operations........      (.39)        (.55)        (.68)        (.39)       (1.73)        (2.36)       (.17)
        Discontinued operations......       .20          .04       --              .10         (.09)                      .08
        Extraordinary items..........       .11          .06          .03       --             (.26)                    --
        Cumulative effect of changes
          in accounting principles...     --          --           --           --             (.25)                     (.25)
        Net loss.....................      (.08)        (.45)        (.65)        (.29)       (2.33)                     (.34)
BALANCE SHEET DATA:
    Total assets.....................   860,709      863,993      851,912      821,170      910,662
    Long-term debt...................   409,418      407,353      345,860      289,758      488,654
    Redeemable preferred stock.......     --          --           --           --           71,794
    Stockholders' equity (deficit)...   117,646      109,052       92,529       86,482      (35,387)
    Net book value (deficit) per
      share..........................      6.78         4.21         3.57         3.34        (1.67)
    Weighted average common shares
      outstanding....................    16,669       25,428       25,853       25,867       25,808        23,712
 
<CAPTION>
 
                                                 PRO FORMA(2)
                                         1993        1993
                                       --------  ------------
 
<S>                                    <C>       <C>
OPERATING DATA:
    Revenues.........................  $521,470    $521,470
    Operating profit.................    22,253      21,476
    Loss from continuing
      operations.....................   (19,628)    (20,574)
    Discontinued operations, net.....    (7,168)
    Extraordinary items, net.........      (448)
    Cumulative effect of changes in
      accounting principles, net.....     --
    Net loss.........................   (27,244)
    Preferred stock dividend
      requirements...................    (2,916)
    Net loss applicable to common
      stockholders(3)................   (30,160)
    Loss per share:
        Continuing operations........     (1.06)       (.98)
        Discontinued operations......      (.34)
        Extraordinary items..........      (.02)
        Cumulative effect of changes
          in accounting principles...     --
        Net loss.....................     (1.42)
BALANCE SHEET DATA:
    Total assets.....................   913,439     944,830
    Long-term debt...................   540,355     540,355
    Redeemable preferred stock.......    71,794      71,794
    Stockholders' equity (deficit)...   (64,749)    (12,298)
    Net book value (deficit) per
      share..........................     (3.04)       (.51)
    Weighted average common shares
      outstanding....................    21,239      23,931
</TABLE>
 
- ------------
 
(1) Summary financial information has been retroactively restated to reflect the
    discontinuance of SEPSCO's utility and municipal services, refrigeration and
    natural  gas and oil operations in fiscal 1993. On December 9, 1993 SEPSCO's
    Board of  Directors  decided  the  natural gas  and  oil  business  will  be
    transferred  to Triarc rather than SEPSCO selling it to an independent third
    party. Such transfer  will be  in the form  of a  sale of the  stock of  the
    entities  comprising  the  natural gas  and  oil  business for  cash.  It is
    intended for  this sale  to occur  following the  Merger and  the  resulting
    elimination  of the minority interest in  SEPSCO. However, should the Merger
    not be approved  by the SEPSCO  stockholders the  sale of the  stock of  the
    natural  gas and oil entities for cash  to Triarc will be completed prior to
    July 22, 1994.
 
(2) Pro forma  summary financial  information reflects  (i) the  issuance of  an
    aggregate  2,691,822  common  shares  of Triarc  for  all  of  the aggregate
    3,364,778 SEPSCO  common  shares owned  by  stockholders other  than  Triarc
    Companies and its subsidiaries in connection with the Merger Agreement, (ii)
    the  payment of $1,000,000 of estimated  expenses related to the issuance of
    the stock  and $3,000,000  of estimated  fees and  expenses related  to  the
    Merger  and Settlement  Agreement and  (iii) the  Completed Transactions (as
    defined in  the TRIARC  COMPANIES PRO  FORMA FINANCIAL  STATEMENTS  included
    elsewhere herein).
 
(3) Triarc has not declared or paid any dividends on its common shares during
    any of the periods presented.
 
                                       16

<PAGE>
              SOUTHEASTERN PUBLIC SERVICE COMPANY AND SUBSIDIARIES
                        SUMMARY FINANCIAL INFORMATION(1)
<TABLE>
<CAPTION>
                                                                                                             NINE MONTHS ENDED
                                                                                                                NOVEMBER 30,
                                                       FISCAL YEAR ENDED FEBRUARY 28 OR 29,          PRO     ------------------
                                                 ------------------------------------------------  FORMA(2)
                                                   1989      1990      1991      1992      1993      1993      1992      1993
                                                 --------  --------  --------  --------  --------  --------  --------  --------
                                                                    (IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
<S>                                              <C>       <C>       <C>       <C>       <C>       <C>       <C>       <C>
OPERATING DATA:
    Net sales................................... $ 24,134  $ 27,104  $ 29,154  $ 29,220  $ 28,520  $28,520   $ 18,944  $ 19,760
    Operating profit............................    4,045     3,922     3,181     4,571     3,634    2,602      1,705       354
    Income (loss) from continuing operations
      before equity in cumulative effect of
      changes in accounting principles and
      extraordinary items.......................     (632)    7,716     4,245     6,332    12,572   11,540      7,366     1,183
    Income (loss) from discontinued operations,
      net of income taxes.......................     (425)   (2,256)   (7,899)     (225)   (5,542)                938   (23,355)
    Cumulative effect of changes in accounting
      principles of:
        SEPSCO..................................    --        --        --        --        --                  --        7,617
        Equity in affiliates, net of taxes......    --        --        --        --       (5,954)             (5,954)     (102)
    Equity in extraordinary items of
      affiliates................................    1,226       748       794     --         (348)              --        --
    Net income (loss)...........................      169     6,208    (2,860)    6,107       728               2,350   (14,657)
    Preferred stock dividend requirements.......      (24)      (16)       (8)       (1)       (1)                 (1)       (1)
    Net income (loss) applicable to common
      stockholders(2)...........................      145     6,192    (2,868)    6,106       727               2,349   (14,658)
    Income (loss) per share(3):
        Continuing operations...................     (.05)      .66       .36       .54      1.08     1.39        .63       .10
        Discontinued operations.................     (.04)     (.19)     (.68)     (.02)     (.48)                .08     (2.00)
        Cumulative effect of changes in
          accounting principles of affiliate....    --        --        --        --         (.51)               (.51)      .64
        Extraordinary items of affiliate........      .10       .06       .07     --         (.03)              --        --
        Net income (loss).......................      .01       .53      (.25)      .52       .06                 .20     (1.26)
    Triarc Companies' loss from continuing
      operations per equivalent SEPSCO
      share(4)..................................                                                     (1.89)
BALANCE SHEET DATA:
    Total assets................................  206,882   196,498   191,788   208,330   206,253                       171,130
    Long-term debt of continuing operations.....   79,908    71,845    64,373    56,826    49,661                        50,501
    Long-term debt included in discontinued
      operations................................   19,383    18,146    17,973    18,070    16,992                           277
    Stockholders' equity........................   82,672    88,503    85,010   107,503   108,230                        93,572
    Net book value per share....................     7.09      7.59      7.29      9.22      9.28                          8.03
    Triarc Companies' net book value (deficit)
      per equivalent SEPSCO share(4)
 
<CAPTION>
 
                                                  PRO FORMA(2)
                                                      1993
                                                  ------------
 
<S>                                              <C>
OPERATING DATA:
    Net sales...................................  $     19,760
    Operating profit............................          (420)
    Income (loss) from continuing operations
      before equity in cumulative effect of
      changes in accounting principles and
      extraordinary items.......................           409
    Income (loss) from discontinued operations,
      net of income taxes.......................
    Cumulative effect of changes in accounting
      principles of:
        SEPSCO..................................
        Equity in affiliates, net of taxes......
    Equity in extraordinary items of
      affiliates................................
    Net income (loss)...........................
    Preferred stock dividend requirements.......
    Net income (loss) applicable to common
      stockholders(2)...........................
    Income (loss) per share(3):
        Continuing operations...................           .05
        Discontinued operations.................
        Cumulative effect of changes in
          accounting principles of affiliate....
        Extraordinary items of affiliate........
        Net income (loss).......................
    Triarc Companies' loss from continuing
      operations per equivalent SEPSCO
      share(4)..................................          (.78)
BALANCE SHEET DATA:
    Total assets................................       196,227
    Long-term debt of continuing operations.....        50,501
    Long-term debt included in discontinued 
      operations................................           277
    Stockholders' equity........................       119,369
    Net book value per share....................         14.40
    Triarc Companies' net book value (deficit)
      per equivalent SEPSCO share(4)                      (.41)
</TABLE>
 
- ------------
 
(1) Summary financial information has been retroactively restated to reflect the
    discontinuance  of utility and municipal services, refrigeration and natural
    gas and oil operations in 1993.
 
(2) Pro forma  summary  financial information  reflects  the Merger  which  will
    result  in Triarc Companies owning all  outstanding shares of SEPSCO and the
    payment of expenses related  to the settlement of  the Ehrman Litigation  in
    connection with the Merger and Settlement Agreement.
 
(3) SEPSCO  has not paid  any dividends on  its common shares  during any of the
    periods presented.
 
(4) Triarc Companies' pro forma loss  from continuing operations per  equivalent
    SEPSCO  share and pro forma net book  value per equivalent SEPSCO share were
    calculated by multiplying the Triarc Companies' respective amounts per share
    by the exchange ratio contemplated by the Merger (0.8 Triarc shares to  each
    SEPSCO share).
 
(5) Weighted  average  shares  outstanding  were  11,655,067  for  each  of  the
    historical periods presented. For pro forma periods, weighted average shares
    outstanding were 8,290,289 after giving effect to 3,364,778 shares of SEPSCO
    Common Stock assumed  to be  exchanged for Triarc  Class A  Common Stock  in
    connection with the Merger.
 
                                       17

<PAGE>
                                  RISK FACTORS
 
HOLDING COMPANY STRUCTURE
 
     Triarc  is a holding  company which conducts all  of its operations through
its  subsidiaries.  All  of  Triarc's  operating  income  is  generated  by  its
subsidiaries.  Triarc must rely on dividends and other advances and transfers of
funds from its subsidiaries, including payments pursuant to certain cost sharing
arrangements described elsewhere herein and certain tax sharing arrangements  to
provide   the  funds  necessary  to  meet  Triarc's  obligations.  See  'CERTAIN
RELATIONSHIPS AND RELATED TRANSACTIONS.' The ability of Triarc's subsidiaries to
pay such dividends and make such advances and transfers is subject to applicable
state laws as well as to the terms of existing and future agreements restricting
the payment of dividends and the making  of such advances and transfers by  such
subsidiaries  to  Triarc.  The  relevant provisions  of  the  existing principal
agreements are described under 'TRIARC  MANAGEMENT'S DISCUSSION AND ANALYSIS  OF
FINANCIAL   CONDITION  AND  RESULTS  OF  OPERATIONS  --  Liquidity  and  Capital
Resources' and in Note 11 of  the Notes to Consolidated Financial Statements  of
Triarc Companies, Inc. and Subsidiaries included elsewhere herein.
 
SUBSTANTIAL LEVERAGE; DEBT SERVICE
 
     Triarc  and  its  consolidated  subsidiaries  are  highly  leveraged.  As a
consequence  of  such  leverage:  (i)  Triarc's  ability  to  obtain  additional
financing  in  the future  for working  capital,  capital expenditures  or other
purposes may be  limited; (ii)  a substantial portion  of Triarc's  consolidated
cash  flow  from operations  may  be dedicated  to  payments in  respect  of its
indebtedness; and (iii) Triarc's flexibility in responding to economic downturns
and competitive pressures could be  limited. See 'TRIARC COMPANIES  MANAGEMENT'S
DISCUSSION    AND   ANALYSIS    OF   FINANCIAL   CONDITION    AND   RESULTS   OF
OPERATIONS -- Liquidity and Capital Resources.'
 
NET LOSSES; NEW MANAGEMENT AND BUSINESS STRATEGY TO RESTORE PROFITABILITY
 
     The  Triarc  Companies  reported   net  losses  after  preferred   dividend
requirements  for each fiscal year from 1989 through 1993, and for the six month
period ended October 31, 1993. The  Triarc Companies believes that these  losses
were  in large  part the  result of  limited managerial  and financial resources
devoted to certain of its business units, a significant amount of high cost debt
and, with respect  to Fiscal 1993  and the  six month period  ended October  31,
1993,   certain  restructuring  and  other  charges.  See  'TRIARC  MANAGEMENT'S
DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.'
 
     In connection with  the Reorganization, new  chief executive officers  were
appointed  for each of RC  Cola, Arby's and National Propane  and a new slate of
executive officers for the Triarc Companies was elected. These new executive and
operating management  teams  have  developed  business  strategies  designed  to
improve  the Triarc Companies' financial performance. The Triarc Companies has a
limited  operating  history  under  these  new  management  teams  and  business
strategies.  Accordingly, although  the members  of these  management teams have
significant experience in their respective  industries, there is no  opportunity
for  prospective  investors to  evaluate such  management on  the basis  of past
performance with the Triarc  Companies. In addition, there  can be no  assurance
that  these strategies can be implemented effectively or that the implementation
of these strategies  will result  in improved profitability.  As a  part of  its
business  strategy, the  Triarc Companies intends  to undertake  and is actively
pursuing acquisitions  and  business  combinations  to  augment  the  four  core
businesses.  The  Triarc  Companies  does  not  currently  have  any agreements,
arrangements  or  understandings   with  respect  to   any  specific,   material
acquisition  or  business  combination.  There  can  be  no  assurance  that new
management will be  able to  identify appropriate  acquisition opportunities  or
that any acquisition, if consummated, will result in improved profitability. See
'BUSINESS   OF   TRIARC  COMPANIES   --  Business   Strategy,'  '   --  Business
Segments --  Soft  Drink  (RC  Cola)  -- Business  Strategy,'  '  --  Fast  Food
(Arby's)  --  Business  Strategy' and  '  -- Liquefied  Petroleum  Gas (National
Propane and Public Gas) -- Business Strategy.'
 
                                       18
 
<PAGE>
RC COLA'S RELIANCE ON CERTAIN BOTTLERS AND PRIVATE LABEL SALES
 
     RC Cola  sells  its soft  drink  concentrate  to a  number  of  independent
bottlers  who  are granted  exclusive licenses  to sell  RC Cola  brand products
within a defined territory.  Two of RC  Cola's bottlers purchased  approximately
22.3% and 16.1%, respectively, of the concentrate sold by RC Cola in Fiscal 1993
and  approximately 25.4% and 16.9%, respectively,  of the concentrate sold by RC
Cola in Transition 1993. RC Cola's ten largest bottlers purchased  approximately
68.3% and 77.0%, respectively, of the concentrate sold by RC Cola in Fiscal 1993
and  Transition 1993, respectively. If one or  more of these major bottlers, due
to financial  difficulties of  the bottlers  or otherwise,  were to  discontinue
selling  RC  Cola  brand products  for  any  reason, RC  Cola's  sales  could be
adversely affected in  the areas  serviced by  such bottlers.  See 'BUSINESS  OF
TRIARC  COMPANIES --  Business Segments  -- Soft  Drink (RC  Cola) --  RC Cola's
Bottler Network.'
 
     In 1991, RC Cola entered into a five-year contract with Cott (the  'Current
Cott  Agreement') to  be Cott's sole  provider of cola  concentrates for private
label soft drinks in the United States and Canada. In Fiscal 1993 and Transition
1993, respectively, revenues  from sales  of private label  concentrate to  Cott
represented 10.6% and 10.9%, respectively, of RC Cola's total revenues.
 
     In  January 1994, RC Cola  and Cott agreed on the  terms of a new agreement
(the  'Cott  Worldwide  Agreement'),  which  will  supersede  the  Current  Cott
Agreement.  Under the Cott Worldwide Agreement, RC Cola will be Cott's exclusive
worldwide supplier  of  cola  concentrates  for  retailer-branded  beverages  in
various  containers. In  addition, wherever possible,  RC Cola  will also supply
Cott's requirements for  non-cola carbonated soft  drink concentrates. The  Cott
Worldwide  Agreement  requires that  Cott  purchase at  least  75% of  its total
worldwide requirements for carbonated soft drink concentrates from RC Cola.  The
initial term of the Cott Worldwide Agreement is 21 years, with multiple six-year
renewable terms. Although the Cott Worldwide Agreement provides that RC Cola may
manufacture and sell private label concentrate to other packagers or bottlers if
Cott  does  not meet  certain  minimum purchase  requirements,  there can  be no
assurance that RC  Cola would be  able to enter  into satisfactory  arrangements
with  an  alternative private  label  concentrate purchaser  either  upon Cott's
failure to meet such  minimum requirements or upon  the termination of the  Cott
Worldwide   Agreement.   See   'BUSINESS  OF   TRIARC   COMPANIES   --  Business
Segments -- Soft Drink (RC Cola) -- Private Label.'
 
ARBY'S EXPANSION STRATEGY
 
     Arby's fast food business consisted  of 259 company-owned and operated  and
2,423  franchised units  as of  December 31,  1993. As  part of  Arby's business
strategy, management  currently  intends to  open  approximately 20  to  30  new
company-owned  restaurants and  to renovate  or remodel  approximately 70  to 80
company-owned restaurants in 1994.  In addition, Arby's  is seeking to  increase
the   number  of  its  franchised   restaurants.  Arby's  ability  to  implement
successfully its expansion plan  will depend on  various factors, including  the
ability  to  identify  and acquire,  by  lease  or purchase,  suitable  sites on
satisfactory terms, the availability of skilled management and, with respect  to
the expansion of franchised units, the ability to identify and attract qualified
franchisees. There can be no assurance that Arby's will be able to implement its
proposed   expansion  strategy,  including  the  remodeling  plan,  or  that  if
implemented  such  strategy  will  be   successful.  See  'BUSINESS  OF   TRIARC
COMPANIES -- Business Segments -- Fast Food (Arby's) -- Business Strategy.'
 
BUSINESS ENVIRONMENT OF TEXTILE INDUSTRY
 
     Graniteville's  business is subject to cyclical economic trends that affect
the domestic textile industry. Certain of Graniteville's product lines (such  as
utility wear) are sensitive to fluctuations in the general economy, while others
may  be affected  by changes in  fashion trends. Exchange  rate fluctuations can
also affect the  level of  demand for  Graniteville's products  by changing  the
relative  price of competing  fabrics from overseas  producers. See 'BUSINESS OF
TRIARC COMPANIES -- Business Segments -- Textiles (Graniteville).'
 
                                       19
 
<PAGE>
COMPETITION
 
     Each of the industries in which the Triarc Companies' four core  businesses
are  engaged is  highly competitive. Some  competitors in  these industries have
significantly greater financial, marketing,  personnel and other resources  than
does the Triac Companies. See 'BUSINESS OF TRIARC COMPANIES -- Competition.'
 
     In  recent  years,  both  the  soft drink  and  fast  food  industries have
experienced  increased  price   competition  resulting   in  significant   price
discounting   throughout  these  industries.  While  the  net  impact  of  price
discounting cannot be quantified, a continuation of this practice could have  an
adverse effect on the Triarc Companies.
 
     In  addition,  the  Triarc  Companies'  textile  business  has  experienced
significant competition from manufacturers located outside of the United  States
that  generally have access to  less expensive labor and,  in certain cases, raw
materials. The  North  American Free  Trade  Agreement ('NAFTA'),  which  became
effective  on January 1, 1994,  immediately eliminated quantitative restrictions
on qualified imports of  textiles between the United  States, Mexico and  Canada
and  will gradually eliminate tariffs on such imports over a ten-year period. In
addition, a tentative agreement reached on  December 15, 1993 under the  General
Agreement   on  Trade   and  Tariffs   ('GATT')  would   eliminate  quantitative
restrictions on imports of  textiles and apparel  between GATT member  countries
over   a  ten-year  transition  period.  Any  significant  reduction  in  import
protection for domestic textile manufacturers could materially adversely  affect
the the Triarc Companies' business.
 
CONTROL BY CERTAIN SHAREHOLDERS
 
     At present, DWG Acquisition owns directly or indirectly approximately 28.1%
of  the  outstanding  Triarc Class  A  Common  Stock. DWG  Acquisition  will own
approximately 24.9% of the outstanding Triarc Class A Common Stock after  giving
effect  to the issuance of shares of Triarc  Class A Common Stock in the Merger.
Messrs. Peltz  and  May,  as  the sole  general  partners  of  DWG  Acquisition,
beneficially  own  all  of  the  Triarc  Class  A  Common  Stock  owned  by  DWG
Acquisition. As a result of  such ownership, Messrs. Peltz  and May are able  to
exercise  significant influence over the election of members of the Triarc Board
of  Directors  (the  'Triarc  Board')  and   may  also  be  able  to   influence
significantly  the outcome  of certain  corporate actions  requiring shareholder
approval, including mergers, consolidations and the sale of all or substantially
all of Triarc's assets, and may be in a position to prevent or cause a change in
control of Triarc.
 
ENVIRONMENTAL CONSIDERATIONS
 
     Certain of the Triarc Companies'  operations are subject to federal,  state
and  local environmental laws and regulations concerning the discharge, storage,
handling  and  disposal  of  hazardous  or  toxic  substances.  Such  laws   and
regulations provide for significant fines, penalties and liabilities, in certain
cases  without regard to whether the owner  or operator of the property knew of,
or was  responsible for,  the release  or presence  of such  hazardous or  toxic
substances.  In  addition,  third  parties may  make  claims  against  owners or
operators of properties  for personal  injuries and  property damage  associated
with  releases of  hazardous or  toxic substances.  The Triarc  Companies cannot
predict what environmental  legislation or  regulations will be  enacted in  the
future  or how existing  or future laws  or regulations will  be administered or
interpreted.  The  Triarc  Companies  cannot   predict  the  amount  of   future
expenditures  which may  be required in  order to comply  with any environmental
laws or regulations or to satisfy any such claims. The Triarc Companies believes
that its operations comply substantially with all applicable environmental  laws
and regulations. See 'BUSINESS OF TRIARC COMPANIES -- Environmental Matters' for
additional information relating to environmental matters.
 
                                       20
 
<PAGE>
                              THE SPECIAL MEETING
 
GENERAL
 

     This  Proxy Statement-Prospectus and the accompanying notice of the Special
Meeting and form of proxy  are being furnished to all  holders of record on  the
Record  Date of  shares of  SEPSCO Common Stock  and shares  of SEPSCO Preferred
Stock in connection with the solicitation of proxies by the SEPSCO Board for use
at the Special Meeting  to be held  on Thursday, April  14, 1994, commencing  at
12:00 noon, local time, at the Palm Beach Airport Hilton, 150 Australian Avenue,
West  Palm Beach, Florida, and any  adjournments or postponements thereof. These
proxy materials are being  mailed to the SEPSCO  Stockholders on or about  March
14, 1994.

 
     At  the Special Meeting, the SEPSCO  Stockholders will be asked to consider
and vote upon a proposal  to adopt the Merger  Agreement, pursuant to which  (i)
Mergerco  will be merged with  and into SEPSCO, with  SEPSCO being the Surviving
Corporation, all of the common stock of  which will be owned by Triarc and  (ii)
each share of SEPSCO Common Stock outstanding immediately prior to the Effective
Time  (other than  shares of  SEPSCO Common  Stock then  owned by  Triarc or any
subsidiary of Triarc, all of which will be cancelled) will be converted into the
right to receive 0.8 of a share of Triarc Class A Common Stock. The full text of
the Merger Agreement is attached as Annex I hereto and is incorporated herein in
its entirety. See 'THE MERGER AGREEMENT.'
 
VOTING AT THE SPECIAL MEETING
 
     Record Date. The close of business on  March 7, 1994 has been fixed as  the
Record Date for determining the SEPSCO Stockholders entitled to notice of and to
vote at the Special Meeting. On the Record Date, there were 11,655,067 shares of
SEPSCO  Common Stock  and 490 shares  of SEPSCO Preferred  Stock outstanding and
entitled to  vote,  held  by  approximately  2,400  holders  of  record.  SEPSCO
Stockholders  may cast one vote per share, either in person or by proxy, on each
matter to be voted on at the Special Meeting.
 
     Required Stockholder Vote. A majority  of the outstanding shares of  SEPSCO
Voting  Stock entitled to vote,  represented in person or  by proxy, is required
for a quorum at the Special Meeting. The affirmative vote of (i) the holders  of
a  majority of the outstanding shares of SEPSCO Voting Stock entitled to vote at
the Special Meeting (considered as a single class), (ii) the holders of at least
two-thirds of the outstanding shares of SEPSCO Preferred Stock entitled to  vote
at  the Special  Meeting and  (iii) the  holders of  at least  two-thirds of the
outstanding shares of SEPSCO  Voting Stock, other than  those held by Triarc  or
any  subsidiary of Triarc, entitled to vote  at the Special Meeting, is required
to adopt the Merger Agreement. Therefore, abstentions and broker non-votes  will
have  the same  effect as  votes against adoption  of the  Merger Agreement. The
Merger Agreement  requires Triarc  to vote,  or cause  to be  voted, all  shares
beneficially  owned by it in favor of  adoption of the Merger Agreement. Triarc,
which directly and through a wholly-owned  subsidiary owns and has the right  to
vote  at the  Special Meeting approximately  71.1% of the  outstanding shares of
SEPSCO Voting  Stock and  100% of  the outstanding  shares of  SEPSCO  Preferred
Stock,  controls a sufficient number of shares of SEPSCO Common Stock and SEPSCO
Preferred Stock to cause the votes described in clauses (i) and (ii) above to be
obtained without  the  vote  of  any  other  SEPSCO  Stockholder.  HOWEVER,  THE
OBTAINING  OF THE VOTE DESCRIBED  IN CLAUSE (III) ABOVE  DEPENDS SOLELY UPON THE
VOTE OF SEPSCO STOCKHOLDERS OTHER THAN TRIARC AND CANNOT BE ASSURED.
 
     THE SEPSCO BOARD UNANIMOUSLY RECOMMENDS  THAT SEPSCO STOCKHOLDERS VOTE  FOR
ADOPTION OF THE MERGER AGREEMENT.
 
PROXIES
 
     All  shares of  SEPSCO Voting Stock  represented at the  Special Meeting by
properly executed proxies received  prior to or at  the Special Meeting,  unless
the  proxies have previously been revoked, will  be voted in accordance with the
instructions on such  proxies. If  no instructions  are given,  proxies will  be
voted  FOR adoption of the  Merger Agreement. If any  other matters are properly
presented to the Special Meeting for  action, the persons named in the  enclosed
form of proxy as acting thereunder
 
                                       21
 
<PAGE>
will  have discretion  to vote  on such  matters in  accordance with  their best
judgment. SEPSCO does not know of any matters other than adoption of the  Merger
Agreement  and procedural  matters relating  to the  conduct of  business at the
Special Meeting that will be presented at the Special Meeting.
 
     Any proxy given pursuant to this solicitation may be revoked by the  person
giving  it at any time before it is voted. Proxies may be revoked by delivery to
the Secretary  of SEPSCO,  at  Southeastern Public  Service Company,  777  South
Flagler  Drive, Suite 1000E, West Palm Beach, Florida 33401, of a written notice
of revocation  bearing  a later  date  than the  proxy,  by duly  executing  and
delivering  to the Secretary a subsequent proxy  relating to the same shares, or
by attending the Special  Meeting and voting in  person (although attendance  at
the Special Meeting will not in and of itself constitute revocation of a proxy).
 
     Proxies  are  being solicited  by and  on  behalf of  the SEPSCO  Board. In
addition to solicitation  by mail,  proxies may  be solicited  by directors  and
authorized  officers and employees of SEPSCO in person or by telephone, telegram
or other means of communication. Such directors, officers and employees will not
be additionally compensated, but may be reimbursed for out-of-pocket expenses in
connection  with  such  solicitation.  Arrangements  will  also  be  made   with
custodians,  nominees  and  fiduciaries  for  forwarding  of  proxy solicitation
material to beneficial owners of shares of SEPSCO Voting Stock held of record by
such persons, and SEPSCO may reimburse such custodians, nominees and fiduciaries
for reasonable  expenses  incurred  in connection  therewith.  SEPSCO  has  also
retained  the  firm of  Georgeson &  Company  to assist  in the  solicitation of
proxies. See  'FINANCING OF  THE  MERGER AND  RELATED TRANSACTIONS:  SOURCE  AND
AMOUNT  OF  FUNDS'  for  additional  information  concerning  proxy solicitation
expenses to be borne by SEPSCO and Triarc.
 
     All information in  this Proxy Statement-Prospectus  concerning the  Triarc
Companies   (including  information  concerning  its  capital  stock  and  other
securities), Mergerco, the Triarc Class A Common Stock, the plans for SEPSCO and
its subsidiaries after  the Merger and  the pro forma  financial statements  has
been  provided by Triarc.  Except as otherwise  indicated, all other information
contained in this Proxy Statement-Prospectus has been supplied by SEPSCO.
 
     THE MERGER CONSTITUTES A MATTER OF GREAT IMPORTANCE TO SEPSCO STOCKHOLDERS.
IF THE MERGER AGREEMENT  IS APPROVED AND THE  MERGER IS CONSUMMATED, THE  DIRECT
EQUITY INVESTMENT IN SEPSCO OF SEPSCO'S PUBLIC STOCKHOLDERS WILL CEASE, AND SUCH
STOCKHOLDERS  WILL BE ENTITLED TO RECEIVE THE MERGER CONSIDERATION. ACCORDINGLY,
SEPSCO STOCKHOLDERS ARE  URGED TO  READ AND CAREFULLY  CONSIDER THE  INFORMATION
PRESENTED IN THIS PROXY STATEMENT-PROSPECTUS.
 
                                       22

<PAGE>
                                SPECIAL FACTORS
 
BACKGROUND TO THE MERGER; REASONS FOR THE MERGER
 
THE REORGANIZATION AND RELATED MATTERS
 
     EQUITY TRANSACTIONS
 
     On  April  23,  1993,  the Equity  Transactions  were  consummated  and DWG
Acquisition acquired control of the  Triarc Companies from the Posner  Entities.
Immediately prior to the closing of the Equity Transactions, the Posner Entities
owned approximately 46% of the outstanding common equity of the Company.
 
     The principal elements comprising the Equity Transactions are as follows:
 
           DWG  Acquisition purchased from the  Posner Entities 5,982,867 shares
           of Triarc Class A Common  Stock, representing approximately 28.6%  of
           Triarc's    common   equity   outstanding   immediately   after   the
           Reorganization, for $12.00 per share, or an aggregate purchase  price
           of $71.8 million.
 
           The  remaining 5,982,866 shares of Triarc  Class A Common Stock owned
           by the Posner Entities were  exchanged for newly created,  non-voting
           shares  of  Redeemable  Convertible  Preferred  Stock.  The 5,982,866
           shares of Redeemable  Convertible Preferred Stock  so issued have  an
           aggregate  stated  value of  $71.8  million and  a  cumulative annual
           dividend rate of  8 1/8%, and  are convertible into  an aggregate  of
           4,985,722 shares of Triarc's Class B Common Stock, par value $.10 per
           share  (the 'Triarc  Class B  Common Stock'),  which shares  are non-
           voting, at a conversion price of $14.40 per share, subject to certain
           adjustments. The shares of Redeemable Convertible Preferred Stock can
           be converted without restriction into shares of Triarc Class A Common
           Stock (which shares  have one  vote per share)  if they  are sold  to
           persons   other  than  Victor  Posner,  members  of  his  family,  or
           affiliates of Victor Posner. Triarc has certain first refusal  rights
           with respect to any such sale.
 
           The  minority  interests  owned  by the  Posner  Entities  in certain
           subsidiaries of Triarc, including SEPSCO, were purchased by Triarc.
 
           Victor Posner  and his  son, Steven  Posner, resigned  as  Directors,
           officers  and employees  of Triarc  and all  of its  subsidiaries. In
           connection with such resignations, Victor Posner did not receive  any
           severance  payments.  However, in  order to  induce Steven  Posner to
           resign, Triarc  entered into  a five-year  consulting agreement  (the
           'Consulting  Agreement')  with Steven  Posner  which provides  for an
           initial payment of $1 million at the commencement of the term of such
           agreement and an annual consulting fee of $1 million. The  Consulting
           Agreement  does not require Steven  Posner to provide any substantial
           services to Triarc and Triarc presently does not expect that it  will
           receive any such services from him.
 
           Posner  and his  affiliates are prohibited  for seven  years from (i)
           acquiring securities of Triarc, except  by gift, devise or  operation
           of  law or  upon conversion  of the  Redeemable Convertible Preferred
           Stock; (ii) directly or indirectly  engaging in a tender or  exchange
           offer   for  securities  of  Triarc;  (iii)  proposing  any  business
           combination or extraordinary  transaction involving  Triarc; or  (iv)
           otherwise  acting  to  seek  to  control  the  management,  Board  of
           Directors or policies of Triarc.
 
           Certain  affiliates  and  employees  of  Merrill  Lynch  &  Co.   and
           Donaldson,  Lufkin and Jenrette  Securities Corporation (the 'Merrill
           Lynch/DLJ Investors') purchased from  Triarc an aggregate of  833,332
           newly  issued shares  of Triarc Class  A Common Stock  for $12.00 per
           share, or an aggregate price of approximately $10.0 million.
 
     THE REFINANCING
 
     Concurrently with the consummation of the Equity Transactions, on April 23,
1993 certain debt  of the  Triarc Companies was  refinanced in  order to  reduce
borrowing  costs  and to  make available  additional  funds for  general working
capital   and   liquidity    purposes.   The   principal    elements   of    the
 
                                       23
 
<PAGE>
Refinancing  were  the sale  by RC/Arby's  of  $225 million  aggregate principal
amount of its Senior Secured Step-Up  Rate Notes due 2000 (the 'Step-Up  Notes')
and  the establishment  of a new  $180 million credit  facility for Graniteville
(the 'Graniteville Credit  Facility'). The  Step-Up Notes were  repaid in  their
entirety  on  August 12,  1993 out  of the  proceeds of  the public  offering by
RC/Arby's of $275 million aggregate principal amount of RC/Arby's' 9 3/4% Senior
Secured Notes due  2000 (the  '9 3/4%  Senior Notes').  The Graniteville  Credit
Facility  and  the 9  3/4% Senior  Notes are  described under  'TRIARC COMPANIES
MANAGEMENT'S DISCUSSION  AND  ANALYSIS OF  FINANCIAL  CONDITION AND  RESULTS  OF
OPERATIONS -- Liquidity and Capital Resources.'
 
     As  part of the Refinancing, on  April 23, 1993, RC/Arby's and Graniteville
made loans to Triarc of $75.0  million and $66.6 million, respectively, both  of
which loans are evidenced by unsecured promissory notes (the 'Triarc Notes') due
April  15, 2003 and  bear interest at 9.5%  per annum payable  on October 15 and
April 15 of each year commencing October 15, 1993. Such interest may be paid  at
the option of Triarc in cash or capitalized as additional principal, except that
at  least 20% of  each interest payment through  April 15, 1995  and 40% of each
interest  payment  thereafter  with  respect  to  the  Triarc  Note  payable  to
Graniteville  is to be in cash. The Triarc Note held by RC/Arby's was dividended
to CFC Holdings in August 1993.
 
     The proceeds of the Triarc Notes and the issuance of Triarc Class A  Common
Stock  to  the Merrill  Lynch/DLJ  Investors, aggregating  $151.6  million, were
utilized by Triarc  on April  23, 1993  to (i)  repay $20.8  million of  secured
borrowings  from American Financial  Corporation ('AFC') under  a loan agreement
(the 'AFC Exchange Agreement') which had a scheduled maturity of April 30, 1993,
together with accrued  interest of  $0.6 million;  (ii) repay  $40.0 million  of
intercompany  advances to National Propane which  National Propane used to repay
$30.0 million of secured borrowings it owed under the AFC Exchange Agreement and
$4.8 million principal balance of a  secured note payable to AFC, together  with
accrued  interest aggregating $0.9  million, (iii) repay  $27.1 million of notes
payable to SEPSCO  which SEPSCO used  to repay $12.7  million under an  accounts
receivable  financing arrangement  and $14.4  million of  intercompany loans due
Chesapeake Insurance, including accrued interest; (iv) pay accrued rent of $11.7
million to Posner (after reflecting an $8.9 million reduction in connection with
the settlement of past due amounts); (v) purchase all minority shares of  Triarc
subsidiaries owned by the Posner Entities for an aggregate of $10.9 million, net
of  offset of certain  amounts owed the  Triarc Companies; (vi)  pay legal fees,
shareholder litigation settlements  and other  Reorganization costs  aggregating
$7.6  million; (vii)  purchase shares  of CFC  Holdings and  SEPSCO common stock
owned by National Propane for $3.9 million, which along with the $4.3 million of
proceeds remaining from the  repayment of the advance  referred to in item  (ii)
above,  are  intended  to  fund  working  capital  needs  of  National  Propane.
Approximately $29 million of proceeds remained at Triarc immediately  subsequent
to  the Refinancing, which  proceeds have been  or will be  used to fund general
corporate expenditures and working capital  requirements of Triarc and to  repay
amounts  owed  to National  Propane  and SEPSCO  if  needed to  supplement their
working capital requirements.
 
     THE RC/ARBY'S REFINANCING
 
     On August 12, 1993 RC/Arby's sold an aggregate of $275.0 million  principal
amount  of 9 3/4% Senior Notes in an underwritten public offering. Approximately
$223.5 million of the net proceeds from the sale of the 9 3/4% Senior Notes were
used to redeem all of the Step-Up Notes,  and the remainder has been or will  be
used  for  general corporate  purposes, including  capital expenditures  and the
payment of fees and expenses (the 'RC/Arby's Refinancing').
 
     THE RESTRUCTURING
 
     Also, as a part  of the Reorganization,  on April 23,  1993, the Boards  of
Directors  of  Triarc  and SEPSCO  and  certain other  Triarc  subsidiaries were
reconstituted. At the April 24, 1993 meeting of the reconstituted Triarc  Board,
based on a report and recommendations from a management consulting firm that had
conducted an extensive review of the Triarc Companies' operations and management
structure,   the   Triarc  Board   approved   the  Restructuring,   a   plan  of
decentralization and restructuring  which contemplated that  Triarc would  focus
its  resources on its four core businesses and entailed, among other things, the
following features:
 
                                       24
 
<PAGE>
          (i) the strategic decision  to manage Triarc  and its subsidiaries  in
     the future on a decentralized, rather than on a centralized, basis;
 
          (ii) the hiring of new executive officers for Triarc and the hiring of
     new  chief executive officers  and new senior management  teams for each of
     Arby's, RC  Cola and  National Propane  to carry  out the  decentralization
     strategy;
 
          (iii) the termination of a significant number of employees as a result
     of  both the new management philosophy and the hiring of an almost entirely
     new management team; and
 
          (iv) the relocation of the corporate headquarters of Triarc and of all
     of its  subsidiaries  whose headquarters  were  located in  South  Florida,
     including SEPSCO, Arby's, RC Cola and National Propane.
 
     The estimated costs associated with substantially all of these actions were
reflected  in  Triarc's  results  of operations  for  Fiscal  1993.  See 'TRIARC
COMPANIES MANAGEMENT'S  DISCUSSION  AND  ANALYSIS  OF  FINANCIAL  CONDITION  AND
RESULTS OF OPERATIONS.'
 
     At its April 24, 1993 meeting, the reconstituted Triarc Board also approved
the  terms of a proposed settlement of  the Ehrman Litigation in accordance with
the terms set  forth in the  January Memorandum and  authorized the officers  of
Triarc   to  pursue  settlement  of  the   Ehrman  Litigation  along  the  lines
contemplated by the January  Memorandum. See 'SPECIAL  FACTORS -- Background  to
the  Merger; Reasons for the  Merger -- Legal Proceedings  Related to SEPSCO and
Triarc' for a description of the material terms of the January Memorandum.
 
     At its meeting on  April 24, 1993, the  reconstituted SEPSCO Board  created
the SEPSCO Special Committee for the purpose of reviewing, negotiating the terms
of,  and reporting back to the full  SEPSCO Board as to its recommendations with
respect to, any transaction proposed by Triarc in connection with the settlement
of the Ehrman Litigation.  The SEPSCO Special Committee  was given the power  to
engage  such legal, financial and other advisors as the SEPSCO Special Committee
deemed appropriate in carrying out its assignment.
 
LEGAL PROCEEDINGS RELATED TO SEPSCO AND TRIARC
 
     On December  18, 1990,  the Plaintiff  commenced the  Ehrman Litigation,  a
purported  shareholder derivative suit. The action, captioned William A. Ehrman,
derivatively on behalf of nominal defendant Southeastern Public Service  Company
v.  Victor Posner,  et al., was  brought on  behalf of SEPSCO,  against its then
current directors and certain corporations which may then have been deemed to be
affiliates of SEPSCO,  including Triarc,  in the District  Court. The  Plaintiff
subsequently  filed  the  amended  Complaint in  April  of  1991.  The Complaint
alleges, among other things, that the Defendants breached their fiduciary duties
to SEPSCO and  RC/Arby's (i)  by causing  RC/Arby's to  issue approximately  4.1
million  shares of convertible redeemable preferred stock to Triarc for cash and
forgiveness of indebtedness of approximately $41,350,000, which preferred stock,
upon conversion, resulted  in Triarc  owning approximately  88.8% of  RC/Arby's'
outstanding  voting securities and reduced  SEPSCO's ownership of RC/Arby's from
approximately 48%  to  5.4%;  (ii)  by  causing  Chesapeake  Insurance,  then  a
subsidiary  of RC/Arby's and now a subsidiary  of CFC Holdings, to suffer losses
in the operations of its  business; and (iii) by causing  the sale by SEPSCO  in
January 1986 of shares of Graniteville's common stock constituting approximately
51%  of  Graniteville's then  outstanding stock  to  Triarc. The  Complaint also
alleges that the proxy statement issued  by SEPSCO in connection with the  March
8,  1991  Annual  Meeting of  SEPSCO  Stockholders  violated Section  14  of the
Exchange Act by failing  to disclose certain  alleged material facts  concerning
Victor  Posner,  SEPSCO's  then  Chairman  of  the  Board,  President  and Chief
Executive Officer.  In  addition,  the Complaint  alleges  that  the  Defendants
engaged in a pattern of racketeering activity in violation of RICO.
 
     The  Complaint  sought  (i)  a declaration  that  the  Defendants committed
breaches of  trust  and of  their  respective  fiduciary duties  to  SEPSCO  and
RC/Arby's  and their  shareholders; (ii)  unspecified damages,  including treble
damages under the RICO  claim; (iii) an accounting  by the Defendants to  SEPSCO
for  the acts and conduct  alleged in the Complaint; (iv)  a return to SEPSCO of
all salaries and  other remuneration paid  during the time  when the  Defendants
were in breach of their fiduciary duties
 
                                       25
 
<PAGE>
to  SEPSCO; (v) a declaration that all transactions complained of are void; (vi)
an award to the Plaintiff of costs  and expenses; and (vii) any other relief  as
may be appropriate.
 
     The  Defendants  have  denied each  of  the  allegations set  forth  in the
Complaint.
 
     On January  21, 1993,  DWG  Acquisition and  the  Plaintiff in  the  Ehrman
Litigation,  entered into the  January Memorandum which  set forth certain terms
for a proposed settlement  of the Ehrman Litigation.  Insofar as they relate  to
the  Public Stockholders, the proposed settlement terms set forth in the January
Memorandum differed  from the  Settlement Terms  and Conditions  ultimately  set
forth in the Settlement Agreement as described below. The proposed settlement of
the  Ehrman Litigation  contemplated by  the January  Memorandum provided, among
other things, that SEPSCO would be merged into, or otherwise acquired by Triarc,
or a subsidiary  or affiliate thereof,  on the following  terms: each holder  of
SEPSCO  Common Stock other than Triarc would  receive in exchange for each share
of SEPSCO Common Stock, .55 shares of Triarc Class A Common Stock and a note (or
appropriate portion of a  note) payable by Triarc  or SEPSCO having a  principal
amount  of $6.00  (a 'Settlement  Note') and  the SEPSCO  Common Stock  would be
delisted from the  PSE and  would be  eligible for  termination of  registration
pursuant  to  Section 12(g)(4)  of the  Exchange Act.  According to  the January
Memorandum, it was to have  been a condition to  the closing of the  transaction
contemplated thereby that no transactions were to have been entered into between
the  date of the January Memorandum and  the date of the merger (or acquisition)
which would have  a material  dilutive effect upon  the common  stock of  Triarc
(other  than (i) the  granting of stock  options pursuant to  the existing stock
option plan of Triarc and (ii) the  issuance or potential issuance of shares  of
common  stock  of Triarc  in connection  with the  then proposed  refinancing of
Triarc, including  shares to  be  issued upon  exercise  of warrants  issued  in
connection with such proposed refinancing, of not more than 8% of that number of
shares  of Triarc's  common stock which  are issued  and outstanding immediately
prior to the consummation of the Reorganization) nor were there to have occurred
any material adverse change to Triarc or SEPSCO. The January Memorandum provided
that the defendants in  the Ehrman Litigation would  retain the firm of  Salomon
Brothers Inc or another investment banking firm of similar stature to state with
respect  to the Settlement Notes that they would  have a fair market value, on a
fully distributed  basis, of  approximately $6.00  per each  $6.00 of  principal
amount.  The January Memorandum also provided  that Plaintiff's counsel would be
paid by Triarc or SEPSCO, subject to District Court approval, in respect of  its
fees  and expenses,  an amount not  to exceed  $650,000 in cash  and $650,000 in
value in notes (the 'Counsel Notes') (which Counsel Notes would be identical  in
form and substance to the Settlement Notes).
 
     As  a  result  of  discussions  held  subsequent  to  the  closing  of  the
Reorganization between  representatives of  Triarc  and the  Plaintiff,  certain
changes  from the proposed settlement terms  set forth in the January Memorandum
were made. Such  changes are  set forth in  the September  Memorandum which  was
executed  on September 13, 1993 and which supersedes the January Memorandum. The
settlement of the  Ehrman Litigation  contemplated by  the September  Memorandum
differs  from  the terms  contemplated  by the  January  Memorandum in  that the
September Memorandum (i) increased the number of shares of Triarc Class A Common
Stock to be received in the merger (or acquisition) transaction from .55 to  0.8
per  share of SEPSCO Common Stock,  while eliminating the Settlement Notes, (ii)
revised certain of  the conditions to  the closing of  the transaction in  which
Triarc would acquire the shares of SEPSCO Common Stock held by the SEPSCO Public
Stockholders,  (iii) provided  for the  payment by  Triarc of  up to  $50,000 of
Plaintiff's investment banker's fees and expenses, and (iv) provided for an  all
cash  payment by Triarc of Plaintiff's attorneys  fees and expenses in an amount
not to  exceed $1,250,000.  The primary  reason for  eliminating the  Settlement
Notes  and increasing the number of shares of Triarc Class A Common Stock was to
provide the Public Stockholders with  more liquid securities, since many  SEPSCO
Stockholders  would have received Settlement Notes  in principal amounts of less
than $1,000 which would have been  illiquid or prohibitively expensive to  sell.
The  closing conditions were revised to reflect the fact that the Reorganization
had been completed and to clarify what actions would and would not be deemed  to
have  a materially dilutive effect upon the  Triarc Common Stock to be issued as
Merger Consideration.
 
     On October 18,  1993, the  parties to  the Ehrman  Litigation executed  the
Settlement Agreement containing the Settlement Terms and Conditions contemplated
by the September Memorandum. The
 
                                       26
 
<PAGE>
Settlement Terms and Conditions contemplated by the September Memorandum and set
forth  in the  Settlement Agreement  provide for  dismissal on  the merits, with
prejudice and without costs to any party (except as described below with respect
to the  award  of  Plaintiff's  counsel's fees  and  expenses),  of  the  Ehrman
Litigation  and the release  of any and  all claims, rights  or causes of action
against the Defendants  and certain  other persons  that the  Plaintiff (in  his
individual and derivative capacity), SEPSCO or any SEPSCO Stockholder, or any of
their  respective  successors or  assigns, have  or may  have, whether  known or
unknown or suspected to exist, which were  or could have asserted in the  Ehrman
Litigation or in any court or forum in connection with, arising out of or in any
way  relating  to  the acts,  facts,  transactions, omissions  or  other subject
matters set forth, embraced or otherwise  referred to in the Ehrman  Litigation,
the  Complaint or the Settlement Agreement.  The Settlement Terms and Conditions
also provide  that  Triarc will  release  the  Defendants from  all  claims  for
indemnification,  contribution  or otherwise  seeking  recovery for  any alleged
damage, loss or injury incurred by Triarc by reason of the specific transactions
challenged in the Ehrman Litigation, including loss or injury incurred by reason
of Triarc having entered into the Settlement Agreement. The Settlement Terms and
Conditions  include  an  agreement  by  Triarc  that,  in  full  settlement  and
compromise  of all  claims asserted against  the Defendants or  any claims which
might have been asserted against them by  reason of, or in connection with,  any
of  the matters  referred to in  the Complaint,  Triarc will cause  SEPSCO to be
merged into,  or otherwise  acquired by  Triarc, or  a subsidiary  or  affiliate
thereof,  on the following terms: each holder of SEPSCO Common Stock, other than
Triarc or a subsidiary of  Triarc, shall receive in  exchange for each share  of
SEPSCO Common Stock so held 0.8 of a share of Triarc Class A Common Stock.
 
     The  Settlement Terms and Conditions provide that the agreement relating to
the transaction in  which the  shares held by  the Public  Stockholders will  be
acquired shall contain the closing conditions described below and such customary
closing  conditions  as may  be agreed  upon  by Triarc  and the  SEPSCO Special
Committee, including without  limitation, the following:  Triarc shall issue  no
common  stock  or  rights  to  acquire common  stock  between  the  date  of the
Settlement Agreement and the date of the merger (or acquisition) which will have
a materially dilutive economic  effect upon the common  stock of Triarc,  except
that  the following  shall not  be deemed to  have any  such materially dilutive
economic effect  for purposes  hereof:  (a) the  granting  of stock  options  or
restricted stock awards so that the aggregate number of shares of Triarc's stock
to  be issued upon  the issuance of  such restricted stock  awards, and upon the
conversion of such stock options, does  not exceed 3,500,000 shares; or (b)  the
issuance  or potential issuance  of shares of  common stock of  Triarc, upon the
election to convert by any holders, at  at such holders' option, of all or  some
of the Redeemable Convertible Preferred Stock or any other series of convertible
preferred stock or other convertible securities of Triarc outstanding on the day
of the Settlement Agreement; or (c) the issuance or potential issuance of shares
in  connection  with an  underwritten public  offering; or  (d) the  issuance or
potential issuance of shares at not  less than fair market value, as  determined
in  good faith by the Triarc Board; or  (e) any other such issuance of shares of
common stock,  so long  as the  shares  of Triarc  Class A  Common Stock  to  be
received  in exchange  for each  share of  SEPSCO pursuant  to the  terms of the
Settlement Agreement are appropriately adjusted.
 
     The Settlement Terms and Conditions also  provide that Triarc will pay  the
reasonable  fees and expenses  of Plaintiff's counsel  and investment banker, as
may be awarded by the District Court, and include an agreement by Triarc and the
other Defendants not to object to an  application which was then expected to  be
made  (and subsequently was  made) to the District  Court by Plaintiff's counsel
and investment  banker  for  fees  and  expenses in  an  amount  not  to  exceed
$1,250,000 and $50,000, respectively.
 
     The  effectiveness of the Settlement Agreement  is conditioned on (i) entry
by the District Court  of a Final Order  approving the Settlement Agreement  and
the  Settlement Terms and  Conditions set forth therein  as fair, reasonable and
adequate and in the  best interests of SEPSCO  and the Public Stockholders;  and
(ii) such Final Order having become final and nonappealable.
 
     On  November 2,  1993 the District  Court entered a  preliminary order (the
'Preliminary Order')  (i) approving  a form  of written  Notice of  Pendency  of
Derivative  Action, Proposed Settlement of Derivative Action, Settlement Hearing
and   Right   to   Object   (the   'Notice')   and   (ii)   scheduling   January
 
                                       27
 
<PAGE>
11,  1994 as the  date for a hearing  to be held before  the District Court (the
'Hearing') to  determine  the 'reasonableness,  adequacy  and fairness'  of  the
Settlement  Terms and Conditions. The Notice was mailed to SEPSCO's stockholders
on or about November  23, 1993. Such Notice  described the Settlement  Agreement
and the Settlement Terms and Conditions proposed therein and notified the SEPSCO
Stockholders that they would have an opportunity to appear, in person or through
counsel of their own choice, at the Hearing and to note their objection, if any,
to  the Settlement Agreement and the Settlement Terms and Conditions. The Notice
also informed the  SEPSCO Stockholders that  failure to object  to the  proposed
Settlement  Terms and Conditions in  the manner specified in  the Notice will be
deemed to constitute a waiver by such person of his, her or its right to  object
and would bar such person from making such objection in this or any other action
or proceeding.
 

     On  January 11, 1994, the Hearing  was held. No SEPSCO Stockholder objected
to the Settlement Agreement or the Settlement Terms and Conditions in the manner
specified in the Notice, nor did any  SEPSCO Stockholder or party to the  Ehrman
Litigation  appear at the Hearing for the purpose of objecting to the Settlement
Agreement or the Settlement Terms and Conditions. On January 11, 1994, following
the Hearing, the District Court entered  a Final Order approving the  Settlement
Terms  and Conditions and  the Plaintiff's application  for legal and investment
banking fees and expenses  aggregating $1.3 million. The  entry by the  District
Court  of the Final Order satisfied one  of the conditions to the obligations of
Triarc, Mergerco  and SEPSCO  to consummate  the Merger.  If the  Merger is  not
consummated,  the Settlement  Agreement will not  enter into effect  and will be
deemed null and void ab initio and the  rights and duties of the parties to  the
Ehrman  Litigation will  revert, without  prejudice, to  their respective status
immediately prior  to  the  execution  of the  Settlement  Agreement.  Upon  the
occurrence of such event, and if no other settlement or resolution of the Ehrman
Litigation  is  reached, Triarc  has indicated  that  it will  vigorously defend
itself against the allegations contained in the complaint filed by the Plaintiff
in the  Ehrman  Litigation. See  'THE  MERGER  AGREEMENT --  Conditions  to  the
Merger.'

 
     The  description herein of  the Settlement Agreement,  the Settlement Terms
and Conditions, the Final Order, the  dismissal of the Ehrman Litigation and  of
the  releases to be given  pursuant to the Settlement  Agreement is qualified in
its entirety by reference to the  Settlement Agreement and exhibits thereto  and
the  Final Order that have  been filed with the District  Court and which may be
examined in person during regular business hours  at the office of the Clerk  of
the  District  Court,  United States  Courthouse,  301 N.  Miami  Avenue, Miami,
Florida 33128-7788. Copies of the Settlement Agreement and Final Order are  also
available  to SEPSCO Stockholders  from SEPSCO upon written  or oral request to:
Curtis S. Gimson, Southeastern Public Service Company, 777 South Flagler  Drive,
Suite 1000E, West Palm Beach Florida 33401; telephone (407) 653-4000.
 
PURPOSE AND STRUCTURE OF THE MERGER
 

     The  purpose of the  Merger is for Triarc  to acquire all  of the shares of
SEPSCO capital stock that  it does not  currently own so that  SEPSCO will be  a
wholly  owned  subsidiary of  Triarc. The  Merger is  structured to  satisfy the
obligations of Triarc in accordance with the Settlement Terms and Conditions.

 
CERTAIN EFFECTS OF THE MERGER AND RELATED TRANSACTIONS
 
     Following the consummation of the Merger,  the SEPSCO Common Stock will  be
delisted  from the PSE and the registration of the SEPSCO Common Stock under the
Exchange Act will be terminated. The  termination of registration of the  SEPSCO
Common  Stock under the Exchange Act would make certain of the provisions of the
Exchange Act,  such  as the  requirement  of  furnishing a  proxy  statement  in
connection  with  certain meetings  of stockholders,  no longer  applicable with
respect to the  SEPSCO Common Stock.  SEPSCO will be  required to file  periodic
reports  with the Commission so  long as it has securities  (such as the 11 7/8%
Debentures) registered under Section 12 of  the Exchange Act. SEPSCO and  Triarc
have  indicated that some or  all of the net proceeds  from the sale of SEPSCO's
several businesses and assets could be used to prepay or otherwise acquire  some
of   the   11  7/8%   Debentures.  See   'BUSINESS   OF  SEPSCO'   and  'SPECIAL
FACTORS --  Conduct of  the  Business of  the  Surviving Corporation  After  the
Merger.'
 
                                       28
 
<PAGE>
CONDUCT OF THE BUSINESS OF THE SURVIVING CORPORATION AFTER THE MERGER
 
     Following  the Merger, SEPSCO will be  a wholly owned subsidiary of Triarc.
As a result  of the  Merger, the  Board of  Directors of  Mergerco (composed  of
Messrs. Peltz, May and Kalvaria) will become the Board of Directors of SEPSCO.
 
     Triarc has indicated that SEPSCO's Discontinued Operations Plan will not be
affected  by the Merger and accordingly, following the Merger, Triarc intends to
cause SEPSCO to (i) continue with plans  to dispose of its Ice Business and  its
Cold  Storage  Business, to  the extent  not theretofore  disposed of,  and (ii)
transfer the liquefied petroleum gas business of SEPSCO's Public Gas  subsidiary
to  National Propane, although the precise method by which such business will be
transferred has not yet been determined. In connection with the transfer of  the
business  of Public Gas to National Propane, Triarc intends to cause Public Gas,
which is currently 99.7% owned by SEPSCO,  to become wholly owned by the  Triarc
Companies.  Triarc and SEPSCO have agreed in  principle to the sale by SEPSCO to
Triarc of the stock  of the SEPSCO subsidiaries  that hold SEPSCO's natural  gas
and oil working and royalty interests. Such sale will be for a net cash purchase
price of $8.5 million, will be consummated on or before July 22, 1994 and is not
contingent upon the consummation of the Merger.
 
     Following  consummation of the  Merger, and in view  of the plans described
above and the  fact that SEPSCO  will be  a wholly owned  subsidiary of  Triarc,
Triarc will review the present capitalization and dividend policy of SEPSCO, and
may  make changes thereto as well as other material changes in SEPSCO's business
or corporate structure and changes  in SEPSCO's charter, by-laws or  instruments
corresponding thereto.
 
     Triarc's  ability to carry out the plans  described above may be limited by
restrictions  contained  in  applicable  debt  instruments  or  other   material
contractual  arrangements. Therefore, no assurance can be given that Triarc will
complete such plans, or that  applicable contractual or other restrictions  will
not significantly delay Triarc's ability to complete such plans.
 
RECOMMENDATION OF THE SEPSCO SPECIAL COMMITTEE AND THE SEPSCO BOARD
 
     On  January  21, 1993,  DWG  Acquisition and  the  Plaintiff in  the Ehrman
Litigation entered  into  the January  Memorandum  which provided,  among  other
things,  that  Triarc would  cause SEPSCO  to  be merged  into, or  be otherwise
acquired by Triarc,  and that  each holder of  SEPSCO Common  Stock (other  than
Triarc  and its affiliates) would  receive in exchange for  each share of SEPSCO
Common Stock (a)  .55 share of  Triarc common  stock and (b)  a Settlement  Note
payable by Triarc or SEPSCO having a principal amount of $6.00.
 
     From  January  21,  1993 through  April  23, 1993,  DWG  Acquisition worked
towards consummating the Reorganization of Triarc. On April 23, 1993,  following
the closing of the Equity Transactions, a new Board of Directors was elected for
SEPSCO.  On  April 24,  1993, following  the  Reorganization, the  newly elected
SEPSCO Board created the SEPSCO Special Committee composed of directors David E.
Schwab II and Sir  Ian MacGregor for the  purpose of reviewing, negotiating  the
terms  of, and reporting back to the full SEPSCO Board as to its recommendations
with respect  to, any  transaction proposed  by Triarc  in connection  with  the
settlement of the Ehrman Litigation.
 
     The  SEPSCO Special Committee was authorized to engage legal, financial and
other advisors as the  SEPSCO Special Committee  deemed appropriate in  carrying
out  its assignment.  On May  5, 1993,  the SEPSCO  Committee met  informally to
discuss the selection of legal counsel and a financial advisor. Thereafter,  the
SEPSCO  Special  Committee interviewed  law firms  and  retained Willkie  Farr &
Gallagher to  act  as  its  legal  counsel.  Concurrently,  the  SEPSCO  Special
Committee  requested and received presentations from three investment banks. The
SEPSCO  Special  Committee  reviewed  the  presentations  and  held   additional
discussions  with each investment bank, finally selecting Smith Barney to act as
its financial advisor on August 9, 1993.
 
     In the course  of reviewing  the terms of  the Merger,  the SEPSCO  Special
Committee met formally on September 1, 1993, September 30, 1993 and November 15,
1993  and informally on a number of other occasions. At the September 1 meeting,
Smith Barney discussed the general nature of its initial analysis.
 
     After  signing  the  January  Memorandum,  the  Plaintiff  in  the   Ehrman
Litigation  and Triarc continued to negotiate the  terms of a settlement, and on
September 13,  1993,  the September  Memorandum  was signed  which  changed  the
consideration to be distributed in the Merger by eliminating the Settlement Note
component   and  increasing   the  share   exchange  ratio   from  .55   to  0.8
 
                                       29
 
<PAGE>
share of Triarc Class A Common Stock  for each share of SEPSCO Common Stock.  At
the September 30 and November 15, meetings, Smith Barney presented to the SEPSCO
Special Committee its preliminary analyses as to the valuation of SEPSCO and the
valuation  of  the  Triarc  Companies  and at  the  November  15,  1993 meeting,
presented its  preliminary oral  opinion with  respect to  the fairness  of  the
Merger  Consideration from a financial point of  view. At the September 30, 1993
and November 15,  1993 meetings, Smith  Barney also presented  its more  limited
analysis  of the potential value of certain  claims made by the Plaintiff in the
Ehrman Litigation  (the 'Ehrman  Claims'). On  November 22,  1993, Smith  Barney
delivered its written fairness opinion to the SEPSCO Special Committee.
 
     The  SEPSCO Special Committee, after  considering all relevant information,
as more fully  discussed below, voted  unanimously to approve  the terms of  the
Merger at its meeting held on November 15, 1993, subject to the receipt of Smith
Barney's  written  opinion  and subject  also  to receipt  of  certificates from
officers of SEPSCO with respect to the accuracy of representations being made by
SEPSCO in the  Merger Agreement.  During its deliberations,  the SEPSCO  Special
Committee  examined  materials prepared  and  distributed by  Smith  Barney with
respect to the  valuations of  SEPSCO and  the Triarc  Companies and  questioned
Smith  Barney on  aspects of  its analysis  and methodologies.  In addition, the
SEPSCO Special Committee carefully considered a number of other factors relating
to the fairness of the terms of  the Merger and other Merger Consideration.  The
factors considered by the SEPSCO Special Committee included:
 
     Smith  Barney Fairness Opinion. The  SEPSCO Special Committee engaged Smith
Barney to express  its opinion as  to the  fairness, from a  financial point  of
view,  to the SEPSCO Stockholders (other than Triarc and its affiliates), of the
Merger Consideration. Smith  Barney presented  its preliminary  analyses of  the
range  of  valuations  attributable to  SEPSCO  at  the September  30,  1993 and
November 15, 1993  SEPSCO Special Committee  meetings. Thereafter, Smith  Barney
delivered  its written opinion, dated  November 22, 1993, that  as of such date,
the consideration to be  received by the holders  of SEPSCO Common Stock  (other
than Triarc and its affiliates), pursuant to the Merger Agreement was fair, from
a  financial point of view, to such  stockholders. See ' -- Opinion of Financial
Advisor.' In reaching its opinion, Smith  Barney did not consider the  potential
value, if any, to SEPSCO of the Ehrman Claims.
 
     As  part of its analysis of the Merger Consideration, Smith Barney prepared
and presented to the SEPSCO Special Committee a range of valuations attributable
to the Triarc Companies using substantially similar methodologies to those  used
to value SEPSCO. Smith Barney presented its preliminary analysis of the range of
valuations  to the SEPSCO  Special Committee on September  30, 1993 and November
15, 1993, at which times Smith Barney confirmed that the market price for Triarc
Class A  Common Stock  was within  the range  of valuations  derived from  these
analyses.
 
     Assessment  of  Ehrman  Claims.  At  the  request  of  the  SEPSCO  Special
Committee, Smith  Barney  reviewed, from  a  financial point  of  view,  certain
material  allegations contained in  the Complaint and on  September 30, 1993 and
November 15, 1993, presented orally to the SEPSCO Special Committee its analyses
(preliminary and then final) regarding the potential value, if any, to SEPSCO of
the claims relating thereto. Smith  Barney's review and analysis was  undertaken
at  the request of the SEPSCO Special Committee and was not part of the analyses
of SEPSCO and the  Triarc Companies performed in  conjunction with its  opinion.
Smith Barney analyzed four transactions which were the subject of allegations in
the Complaint, including: (i) the issuances of an aggregate of approximately 4.1
million  shares of convertible  redeemable preferred stock  by RC/Arby's in 1988
and in  1989  to Triarc  for  cash and  forgiveness  of indebtedness;  (ii)  the
purchase  by Chesapeake Insurance of Sharon  Steel Corporation common stock from
NVF Company ('NVF') in 1987; (iii) the extension from October 1988 through March
1990 by Chesapeake Insurance  of a series of  loans totalling $4.425 million  to
Pennsylvania   Engineering  Corporation;  and   (iv)  the  sale   by  SEPSCO  of
approximately 2.5 million shares of Graniteville common stock to Triarc in 1986.
 
     For purposes of its analyses, Smith Barney assumed that the Plaintiff would
prevail on each allegation  asserted with respect to  the four transactions  and
did  not take  into account  the validity  of such  claims or  the various legal
defenses available to the Defendants.  In conducting its analyses, Smith  Barney
relied  solely upon information which was publicly available, the description of
each transaction analyzed as set forth in the Complaint and certain  information
provided  by SEPSCO, without  independent verification thereof.  With respect to
transactions (i) and (iv) above, Smith Barney performed a valuation analysis for
RC/Arby's  and  Graniteville   similar  to   that  done  for   SEPSCO  and   the
 
                                       30
 
<PAGE>
Triarc Companies in connection with the preparation of its opinion, although not
as  comprehensive, and assumed that the difference between these values and what
was actually paid would have been invested at an annual compound growth rate  of
10%, and multiplied the result by the proportionate interest held by SEPSCO. For
transactions (ii) and (iii) above, Smith Barney assumed that the investments had
not  been made, the  cash used had  instead been invested  at an annual compound
growth rate of 10% and multiplied the result by the proportionate interest  held
by  SEPSCO. Based on the foregoing, Smith Barney derived a value for such claims
of approximately $4.06 to $8.25 per share of SEPSCO Common Stock, based upon the
fully diluted shares outstanding as of August 31, 1993.
 
     The SEPSCO  Special Committee  also requested  that Smith  Barney have  its
counsel  review and analyze the claims  in the Complaint. Smith Barney's counsel
reviewed the  pleadings of  record  in the  Ehrman Litigation,  including  among
others  the United States  Magistrate Judge's opinion of  November 19, 1992, and
the District  Court's  affirmance of  such  opinion, dismissing  certain  claims
without  prejudice,  and  interviewed  both  Plaintiff's  and  Defendants' trial
counsel. At  the September  30,  1993 SEPSCO  Special Committee  meeting,  Smith
Barney's  counsel presented its oral report  to the SEPSCO Special Committee and
its conclusion  that, based  on such  review, the  court would  most likely  not
permit  the Plaintiff's RICO  claims to be reinstated,  and that the Plaintiff's
claims with respect to alleged omissions in the proxy statement were duplicative
of and inclusive with other claims in the Complaint.
 
     At the  September  30, 1993  meeting,  the SEPSCO  Special  Committee  also
interviewed  trial counsel  for the Plaintiff  in the  Ehrman Litigation. During
this session, the SEPSCO Special Committee explored with Plaintiff's counsel the
various aspects  of  the  Plaintiff's  case and  the  rationale  underlying  the
ultimate  decision  to settle.  In  addition, Plaintiff's  counsel  informed the
SEPSCO Special Committee of its estimates of the settlement value for the Ehrman
Claims, which the SEPSCO Special Committee noted were below the low end of Smith
Barney's range of valuations for such claims.
 
     Terms of Merger/Arm's-Length  Negotiations. The basic  terms of the  Merger
and the Merger Consideration were negotiated at arm's-length by the Plaintiff in
the  Ehrman Litigation and DWG Acquisition,  prior to the Reorganization, and by
Triarc following the Reorganization. The Merger  terms set forth in the  January
Memorandum  and ultimately changed by the  September Memorandum and reflected in
the Settlement Agreement were the results of these negotiations.
 

     Further Action by the SEPSCO Special  Committee. Based on the terms of  the
September  Memorandum, the  SEPSCO Special  Committee and  Triarc negotiated the
terms of the Merger Agreement. Although  the SEPSCO Special Committee, based  on
the oral advice of its advisors as discussed above, preliminarily concluded that
the  terms of the Merger contained in  the September Memorandum were fair to the
SEPSCO Stockholders  (other than  Triarc and  its affiliates)  from a  financial
point  of view, the  SEPSCO Special Committee negotiated  with Triarc to improve
both the  economic and  non-economic terms  of the  Merger. The  SEPSCO  Special
Committee   was  not   successful  in   negotiating  improved   economic  terms;
nevertheless,  the   SEPSCO  Special   Committee  did   successfully   negotiate
improvements  to the non-economic terms of the  Merger Agreement. As a result of
the negotiating efforts by  the SEPSCO Special  Committee, certain changes  were
made to the Merger Agreement prior to its being executed, which changes include,
among other things, (i) the addition of a provision that limits Triarc's ability
to  issue shares of its  capital stock to certain  persons, with certain limited
exceptions, without SEPSCO's written consent,  (ii) the addition of a  provision
that  limits the types of information that  SEPSCO was required to represent and
warrant to  Triarc, (iii)  the addition  of a  provision that  allows SEPSCO  to
terminate  its  obligations to  consummate  the Merger  if  there is  a material
adverse change  in the  business, assets,  financial condition,  the results  of
operations  or certain other events effecting Triarc and its subsidiaries, taken
as a whole, and (iv) the limitation of the circumstances under which Triarc  may
terminate its obligations to consummate the Merger.

 
     Based  on Smith Barney's valuations, the sum  of the range of the potential
per share  recovery  from  certain challenged  transactions  within  the  Ehrman
Claims,  $4.06 to $8.25 (which  as previously noted were  estimates that did not
take into consideration the  validity of the claims  or the availability of  any
legal  defenses) and  the range  of per share  value attributable  to the SEPSCO
Common Stock, $14.42 to $17.73, results in a range of $18.48 to $25.98. Although
in its opinion Smith Barney did not  consider the potential value of the  Ehrman
Claims,  the SEPSCO Special Committee noted that  the mid-point of the $18.48 to
$25.98 range is within the per share value of the Merger Consideration based  on
Smith Barney's analysis of the Triarc Companies, $20.87 to $24.94.
 
                                       31
 
<PAGE>
     Given  the variety and  complexity of the factors  considered by the SEPSCO
Special Committee in its evaluation of the terms of the Merger, it did not  find
it practicable to, and did not, quantify or otherwise attempt to assign relative
weights to the specific factors considered in reaching its determinations.
 
     FOLLOWING THE FAVORABLE RECOMMENDATION OF THE SEPSCO SPECIAL COMMITTEE, THE
FULL  SEPSCO  BOARD UNANIMOUSLY  APPROVED  THE MERGER  AGREEMENT  (INCLUDING THE
MERGER CONSIDERATION)  AND  RECOMMENDS THAT  THE  SEPSCO STOCKHOLDERS  VOTE  FOR
ADOPTION OF THE MERGER AGREEMENT.
 
OPINION OF FINANCIAL ADVISOR
 
     Smith  Barney was retained  by the SEPSCO  Special Committee to  act as its
financial advisor in connection  with the Merger.  Pursuant to such  engagement,
the  Special Committee requested that Smith Barney evaluate the fairness, from a
financial point of view,  to the stockholders of  SEPSCO (other than Triarc  and
its  affiliates)  of the  consideration to  be  received in  the Merger  by such
shareholders. On November 15, 1993, Smith Barney delivered to the SEPSCO Special
Committee its oral opinion,  confirmed by a written  opinion dated November  22,
1993,  to the effect that, as of the respective dates and based upon and subject
to certain matters as stated in its written opinion, the Merger Consideration to
be received by the  holders of SEPSCO  Common Stock (other  than Triarc and  its
affiliates)  in the  Merger was fair,  from a  financial point of  view, to such
holders.
 
     In arriving at  its opinion,  Smith Barney reviewed  preliminary copies  of
this Proxy Statement -- Prospectus and the Merger Agreement and met with certain
senior  officers of SEPSCO and with certain senior officers of Triarc to discuss
the operations, financial  condition, history  and prospects of  SEPSCO and  the
Triarc Companies. Smith Barney also examined certain publicly available business
and  financial information relating to SEPSCO  and the Triarc Companies, as well
as certain financial and other information for SEPSCO and the Triarc  Companies,
provided  to Smith Barney by SEPSCO and Triarc, which is not publicly available,
including projected financial information prepared by the respective managements
of SEPSCO and Triarc. Smith Barney reviewed the financial terms of the Merger as
set forth in the  Merger Agreement in relation  to, among other things:  current
and  historical market prices and trading volumes of the SEPSCO Common Stock and
Triarc Class A Common  Stock; the respective  companies' financial results;  and
the  capitalization and financial conditions of SEPSCO and the Triarc Companies.
Smith Barney also analyzed certain  publicly available information with  respect
to  certain  other  companies  whose  businesses  and  operations  Smith  Barney
considered comparable to those of SEPSCO and the Triarc Companies, the terms  of
certain  other  transactions  that  Smith  Barney  considered  relevant  to  its
investigation and certain  other transactions involving  the buyout of  minority
stockholders.  In addition to  the foregoing, Smith  Barney conducted such other
analyses and  examinations and  considered such  other financial,  economic  and
market  criteria as Smith Barney deemed necessary  to arrive at its opinion. For
purposes of its opinion, Smith Barney  did not, however, consider the  potential
value,  if  any, to  SEPSCO of  the alleged  claims by  plaintiff in  the Ehrman
Litigation. Smith  Barney noted  that  its opinion  was necessarily  based  upon
interest  rates,  dividend rates,  market  conditions and  other  conditions and
circumstances existing and known to Smith Barney as of the date of its  opinion,
and  Smith Barney did not express any opinion as to what the value of the Triarc
Class A Common Stock will be when issued to SEPSCO Stockholders pursuant to  the
Merger or the price at which Triarc's Class A Common Stock will trade subsequent
to the Merger.
 
     In  rendering  its  opinion,  Smith  Barney  assumed  and  relied,  without
independent verification, upon  the accuracy and  completeness of the  financial
and  other information publicly available or furnished to or otherwise discussed
with Smith  Barney. With  respect to  financial forecasts  and other  non-public
financial  information  provided to  or otherwise  discussed with  Smith Barney,
Smith Barney assumed that  such forecasts and  other financial information  were
reasonably  prepared  based  upon  the best  currently  available  estimates and
judgments of the respective managements of SEPSCO and the Triarc Companies as to
the expected future financial performance of SEPSCO and the Triarc Companies. In
rendering its opinion,  Smith Barney  considered the changes  in managements  at
certain  Triarc subsidiaries, the changes to  the Triarc Companies business plan
and the  decision by  the SEPSCO  Board to  pursue the  sale or  disposition  of
certain    of   the   businesses   and    assets   of   SEPSCO.   See   'SPECIAL
FACTORS  --  Background  to   the  Merger;  Reasons  for   the  Merger  --   The
Reorganization  and Related  Matters' and  ' -- Conduct  of the  Business of the
Surviving Corporation After the Merger.' Smith Barney did not make or obtain  an
independent   evaluation   or   appraisal   of   the   assets   or   liabilities
 
                                       32
 
<PAGE>
(contingent or otherwise) of SEPSCO or the Triarc Companies nor did Smith Barney
make any physical inspection of the properties or assets of SEPSCO or the Triarc
Companies. No limitations were imposed by SEPSCO on Smith Barney with respect to
the investigations made or procedures followed by Smith Barney in rendering  its
opinion.
 
     Smith  Barney's opinion does not address  the relative merits of the Merger
as compared to any alternative business  strategies that might exist for  SEPSCO
or  the effect of any  other transaction in which  SEPSCO might engage. Although
Smith Barney evaluated the financial terms  of the Merger, Smith Barney was  not
asked  to and did not recommend the  specific consideration to be paid by Triarc
in the Merger, nor did it participate in any of the negotiations or  discussions
regarding  the terms  of the  Merger or  the proposed  settlement of  the Ehrman
Litigation. Smith Barney  also did  not, nor was  it authorized  to, solicit  or
investigate alternative transactions which might be available to SEPSCO; nor did
it, nor was it requested to, seek other offers for the shares of SEPSCO not held
by Triarc.
 
     The  full text of Smith Barney's  opinion, which sets forth the assumptions
made, matters considered and limitations  on the review undertaken, is  attached
hereto as Annex II. SEPSCO Stockholders are urged to read such opinion carefully
in  its  entirety.  Smith  Barney's  opinion  is  directed  only  to  the Merger
Consideration, does not  address any  other aspect of  the Merger  and does  not
constitute a recommendation to any stockholder as to how such stockholder should
vote  at the SEPSCO Special Meeting. The  summary of the opinion of Smith Barney
set forth in this Proxy Statement -- Prospectus is qualified in its entirety  by
reference to the full text of such opinion.
 
     In preparing its opinion to the Special Committee, Smith Barney performed a
variety  of financial and comparative analyses, including those described below.
The summary of such analyses  does not purport to  be a complete description  of
the  analyses underlying Smith  Barney's opinion. The  preparation of a fairness
opinion is a complex analytic process involving various determinations as to the
most appropriate and relevant methods of financial analysis and the  application
of those methods to the particular circumstances and, therefore, such an opinion
is  not readily susceptible to summary  description. In arriving at its opinion,
Smith Barney did not attribute any  particular weight to any analysis or  factor
considered  by it, but rather made  qualitative judgments as to the significance
and relevance of each  analysis and factor.  Accordingly, Smith Barney  believes
that  its analyses must be considered as  a whole and that selecting portions of
its analyses or specific factors, without considering all analyses and  factors,
could  create a misleading  or incomplete view of  the processes underlying such
analyses  and  its  opinion.  In  its  analyses,  Smith  Barney  made   numerous
assumptions   with  respect  to  SEPSCO   and  the  Triarc  Companies,  industry
performance, general  business, economic,  market and  financial conditions  and
other  matters, many of which  are beyond the control  of SEPSCO and Triarc. The
estimates contained in such  analyses are not  necessarily indicative of  actual
values  or predictive  of future results  or values, which  may be significantly
more or  less favorable  than those  suggested by  such analyses.  In  addition,
analyses  relating to the value of businesses or securities do not purport to be
appraisals or (except  as specifically stated  below) to reflect  the prices  of
which  businesses or securities actually may be sold. Accordingly, such analyses
and estimates are inherently subject to substantial uncertainty. With regard  to
the  comparable public company and  selected merger and acquisition transactions
analyses described  below,  no  company,  transaction  or  business  used  as  a
comparison  in  such analyses  is  identical to  SEPSCO,  Triarc or  the Merger.
Accordingly, an  analysis  of the  results  of  such analyses  is  not  entirely
mathematical; rather it involves complex considerations and judgments concerning
differences  in financial and  operating characteristics and  other factors that
could affect the acquisition  or public trading value  of the Target  Companies,
the  SEPSCO  Comparable Companies  or  Triarc Comparable  Companies  (as defined
below) or the business segment or company to which they are being compared.
 
VALUATION ANALYSIS OF SEPSCO
 
     Smith Barney considered the authorization by  the SEPSCO Board of the  sale
and/or  disposition  of certain  of  the businesses  and  assets of  SEPSCO, and
analyzed, in conjunction  with the  management of SEPSCO,  the potential  values
which  might be achievable in  the sale or disposition  of the SEPSCO businesses
based upon,  among  other  things,  the  businesses'  historical  and  projected
financial  performance, cash flows and financial condition. Smith Barney was not
authorized to,  nor did  it, solicit  proposals  to acquire  any of  the  SEPSCO
businesses  or  assets.  In analyzing  the  potential value  of  the independent
business segments, Smith Barney relied upon the expected completion of the  sale
(which
 
                                       33
 
<PAGE>
has  since been completed) by SEPSCO of  the assets of SEPSCO's tree maintenance
business for  approximately $70  million plus  the assumption  by the  buyer  of
certain  liabilities up  to $5  million. In  addition, Smith  Barney also valued
certain of  SEPSCO's  other investments,  including  (i) SEPSCO's  ownership  of
approximately 49% of the outstanding common stock of Graniteville; (ii) SEPSCO's
ownership  of approximately 5.4%  of CFC Holdings; and,  (iii) a promissory note
issued by Triarc  due August  1, 1998 with  a principal  value of  approximately
$26,538,000.  For the purposes  of determining an  estimated valuation range for
SEPSCO, Smith  Barney  included  (i)  the values  of  the  independent  business
segments,   net  of  any  debt  or  other  significant  liabilities  which  were
identified, (ii) SEPSCO's other investments, (iii) approximately $87 million  of
debt  (net of cash, including restricted  cash, and cash equivalents) identified
on SEPSCO's balance sheet dated August 31, 1993 (prior to accounting adjustments
to reflect the discontinuance  of certain businesses) and  (iv) a reserve for  a
contingent  liability related to certain  environmental matters of approximately
$4 million.
 
     Selected Public Companies Analysis.  Using publicly available  information,
Smith  Barney analyzed, among  other things, the market  values (market value is
defined  as  the  closing  stock  price  multiplied  by  the  number  of  shares
outstanding,  adjusted to reflect  any outstanding common  stock equivalents) of
selected  companies  which  were  deemed  comparable  to  SEPSCO  (the   'SEPSCO
Comparable  Companies'). Smith Barney  compared the market  values of the SEPSCO
Comparable Companies  as multiples  of earnings,  after-tax cash  flow and  book
value.  Smith Barney also  compared the adjusted  market values (adjusted market
value is defined as market value plus the book value of total debt and preferred
stock less the book value of cash and cash equivalents) of the SEPSCO Comparable
Companies  as   multiples  of   revenues,  earnings   before  interest,   taxes,
depreciation  and amortization ('EBITDA') and earnings before interest and taxes
('EBIT'). All market values were based upon closing stock prices as of  November
19, 1993.
 
     Discounted  Cash Flow  Analysis. Smith  Barney performed  a discounted cash
flow analysis  of  the projected  unlevered,  tax-affected free  cash  flows  of
SEPSCO.  Key assumptions in the discounted cash flow analysis of SEPSCO included
(i) discount rates of 10% to 14% and (ii) terminal multiples of projected EBITDA
OF 5.0 to 9.0.
 
     Based upon the above analyses, Smith Barney's estimated valuation range for
SEPSCO was approximately $168 million  to $207 million, or approximately  $14.42
to $17.73 per share.
 
VALUATION ANALYSIS OF THE TRIARC COMPANIES
 
     Smith  Barney  considered the  plan  of decentralization  and restructuring
adopted by the Triarc Board calling for the retention of certain businesses  and
the  sale and/or  disposition of  others, and  analyzed the  values of  both the
retained businesses and those to be disposed of, based upon, among other things,
the businesses' historical and projected  financial performance, cash flows  and
financial  condition. In analyzing the potential value of the business segments,
Smith Barney used a variety of  techniques, including discounted cash flow,  and
comparison  to selected public companies  and selected mergers and acquisitions,
as set forth below. For the purposes of determining an estimated valuation range
for the Triarc Companies, Smith Barney  included (i) the values of the  business
segments,   net  of  any  debt  or  other  significant  liabilities  which  were
identified, (ii) Triarc's 71% ownership  interest in SEPSCO, (iii)  intercompany
notes payable and (iv) discontinued businesses.
 
     Selected  Public Companies Analysis.  Using publicly available information,
Smith Barney analyzed, among other things, the market values (as defined  above)
of selected companies which were deemed comparable to each of Triarc's principal
business segments (the 'Triarc Comparable Companies'). Smith Barney compared the
market  values  of the  Triarc Comparable  Companies  as multiples  of earnings,
after-tax cash flow  and book  value. Smith  Barney also  compared the  adjusted
market values (as defined above) of the Triarc Comparable Companies as multiples
of  revenues, EBITDA and EBIT.  All market values were  based upon closing stock
prices as of November 19, 1993.
 
     Selected Merger  and  Acquisition  Transactions  Analysis.  Using  publicly
available information, Smith Barney analyzed the purchase prices (purchase price
is  defined  as  the  price paid  for  the  equity of  the  target  company) and
transaction values (transaction value is defined as the purchase price plus  the
book  value of total debt  less the book value of  cash and cash equivalents) in
selected merger and acquisition transactions involving target companies ('Target
Companies') which were deemed comparable to each of Triarc's principal  business
segments.  Smith Barney compared the purchase  prices of the Target Companies as
multiples of earnings,  after-tax cash flow  and book value.  Smith Barney  also
compared
 
                                       34
 
<PAGE>
the transaction values of the Target Companies as multiples of revenues, EBITDA,
EBIT and total assets.
 
     Discounted  Cash Flow  Analysis. Smith  Barney performed  a discounted cash
flow analysis of the projected unlevered,  tax-affected free cash flows of  each
of  Triarc's principal  business segments, based  on assumptions  as to discount
rates and terminal multiples which varied for each segment.
 
     Based upon the above analyses, Smith Barney's estimated valuation range for
the Triarc Companies (prior to adjusting for the Merger) was approximately  $686
million to $820 million, or approximately $26.09 to $31.18 per share.
 
     Pursuant  to the terms  of Smith Barney's engagement,  SEPSCO agreed to pay
Smith Barney an opinion fee of $350,000, payable to Smith Barney upon  rendering
its  opinion to the Special Committee. In addition, Smith Barney was entitled to
receive additional  compensation  if the  total  value received  by  the  SEPSCO
Stockholders (other than Triarc and its affiliates) in the Merger increased more
than  $3 million from the value of  the Merger Consideration contemplated by the
September Memorandum.  SEPSCO also  has  agreed to  indemnify Smith  Barney  and
related persons against certain liabilities, including liabilities under federal
securities laws, arising out of Smith Barney's engagement and to reimburse Smith
Barney  for certain out-of-pocket expenses, which Smith Barney currently expects
will aggregate approximately $80,000, incurred pursuant to its engagement.
 
     Smith Barney has advised SEPSCO that,  in the ordinary course of  business,
it  may  actively trade  equity and  debt  securities of  SEPSCO and  the Triarc
Companies for  its  own  account  or  for the  account  of  its  customers  and,
accordingly, may at any time hold a long or short position in such securities.
 
     Smith  Barney is  a nationally recognized  investment banking  firm and was
selected by  the Special  Committee  based upon  Smith Barney's  experience  and
expertise.  Smith Barney  regularly engages in  the valuation  of businesses and
their  securities  in  connection  with  mergers  and  acquisitions,  negotiated
underwritings,  competitive bids, secondary distributions of listed and unlisted
securities, private placements  and valuations for  estate, corporate and  other
purposes.
 
INTERESTS OF CERTAIN PERSONS IN THE MERGER
 

     In  considering the recommendation of the  SEPSCO Board with respect to the
Merger, SEPSCO Stockholders  should be  aware that certain  members of  SEPSCO's
management and of the SEPSCO Board have certain interests which may present them
with  potential conflicts  of interest  in connection  with the  Merger. Messrs.
Peltz and May are Chairman and  Chief Executive Officer and President and  Chief
Operating  Officer,  respectively,  of  SEPSCO,  Triarc  and  Mergerco  and Leon
Kalvaria is the Vice Chairman of each  of SEPSCO, Triarc and Mergerco. Three  of
SEPSCO's  five  directors (Messrs.  Peltz and  May and  Leon Kalvaria)  are also
directors of  Triarc.  The  two  other  SEPSCO  directors  (Messrs.  Schwab  and
MacGregor), who, as the only members of the SEPSCO Board who are not also Triarc
directors, were designated members of the SEPSCO Special Committee to review the
merger  proposal from  Triarc, have  served as  directors of  other corporations
affiliated with  Messrs. Peltz  and May.  All of  the Mergerco's  directors  are
directors of both Triarc and SEPSCO. Substantially all of the executive officers
of Triarc and Mergerco are also executive officers of SEPSCO.

     SEPSCO  Stockholders should  note that  if the  Merger is  consummated, the
District Court will permanently bar and enjoin the institution or prosecution by
the Plaintiff and his counsel, either  directly or derivatively, SEPSCO and  the
SEPSCO  Stockholders,  and any  of  their respective  representatives, trustees,
successors, heirs, executors, administrators and assigns, of all claims,  rights
or  causes of  action, they  now have or  ever had  whether known  or unknown or
suspected to  exist  which  were or  could  have  been asserted  in  the  Ehrman
Litigation,  or in any other court or forum, in connection with, arising out of,
or in any  way relating  to any acts,  facts, transactions,  omissions or  other
subject  matters set forth,  alleged, embraced, or otherwise  referred to in the
Ehrman Litigation,  the  Complaint  or the  Settlement  Agreement,  against  the
Released  Persons. The Released Persons include  each current or former director
and officer of SEPSCO  and Triarc, including each  current member of the  SEPSCO
Board and the SEPSCO Special Committee, as well as each subsidiary of Triarc and
SEPSCO.  The  Released  Persons  also include  Insurance  Risk  Management, Inc.
('IRM'), Security Management Corp. ('SMC') and NVF and their respective  current
and former officers and directors and financial and legal advisors. Each of IRM,
SMC  and NVF is  believed to be  an affiliate of  Victor Posner, SEPSCO's former
Chairman, President and Chief Executive Officer.
 
                                       35

<PAGE>
                    TRIARC COMPANIES, INC. AND SUBSIDIARIES
                         PRO FORMA FINANCIAL STATEMENTS
 
     The  following unaudited pro forma  condensed consolidated Triarc Companies
balance sheet as of  October 31, 1993 (the  'Triarc Companies Pro Forma  Balance
Sheet')  and  pro forma  condensed consolidated  Triarc Companies  statements of
operations for  Fiscal 1993  and the  six  months ended  October 31,  1993  (the
'Triarc  Companies Pro Forma Statements of Operations' and collectively with the
Triarc Companies  Pro  Forma Balance  Sheet,  the 'Triarc  Companies  Pro  Forma
Financial  Statements')  have been  prepared by  adjusting the  Triarc Companies
historical condensed  consolidated balance  sheet  as of  October 31,  1993  and
consolidated  statements of operations for Fiscal  1993 and the six months ended
October 31, 1993 appearing elsewhere herein. The historical financial statements
(i) have been adjusted, as  applicable, to give effect  to (a) the salaries  and
related  employment benefits  of the  new chief  executive officers  of RC Cola,
Arby's and National Propane  (the 'CEO Compensation'),  (b) the Refinancing  and
the  RC/Arby's Refinancing, (c)  the sale of the  utility and municipal services
business segment of SEPSCO  and related use of  proceeds (collectively with  the
CEO  Compensation, the Refinancing and the RC/Arby's Refinancing, the 'Completed
Transactions'), and  (ii) have  been  further adjusted  to  give effect  to  the
Merger,  as if  such transactions had  occurred as  of October 31,  1993 for the
Triarc Companies Pro Forma Balance  Sheet and as of May  1, 1992 for the  Triarc
Companies  Pro Forma  Statements of Operations.  Such pro  forma adjustments are
described in the accompanying notes to the Triarc Companies Pro Forma  Financial
Statements  which should  be read in  conjunction with the  Triarc Companies Pro
Forma Financial Statements. Such Triarc Companies Pro Forma Financial Statements
should also  be  read in  conjunction  with the  Triarc  Companies  consolidated
financial  statements and notes  thereto appearing elsewhere  herein. The Triarc
Companies Pro Forma Financial Statements do not purport to be indicative of  the
actual  financial position or results of operations of Triarc Companies had such
transactions actually been  consummated on  October 31,  1993 and  May 1,  1992,
respectively,  or  of  the  future  financial  position  or  future  results  of
operations of Triarc Companies which will  result from the consummation of  such
transactions.
 
                                       36
 
<PAGE>
                    TRIARC COMPANIES, INC. AND SUBSIDIARIES
                 PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET
                                OCTOBER 31, 1993
                                  (UNAUDITED)
 
<TABLE>
<CAPTION>
                                                                                       ADJUSTMENTS
                                                                       ADJUSTMENTS       FOR THE
                                                                         FOR THE       MERGER AND
                                                               AS       COMPLETED      SETTLEMENT
                                                            REPORTED   TRANSACTIONS     AGREEMENT      PRO FORMA
                                                            --------   -----------     -----------     ---------
                                                                               (IN THOUSANDS)
<S>                                                         <C>        <C>             <C>             <C>
                          ASSETS
Current assets:
     Cash and equivalents.................................  $ 87,178    $  42,841(a)    $  (1,000)(c)  $125,834
                                                                             (185)(b)      (3,000)(d)
     Receivables, net.....................................   109,122                                    109,122
     Inventories..........................................   114,661                                    114,661
     Deferred income taxes................................    22,632                                     22,632
     Net current assets of discontinued operations .......    33,062      (33,062)(a)                        --
     Other current assets.................................    29,596                                     29,596
                                                            --------   -----------     -----------     ---------
          Total current assets............................   396,251        9,594          (4,000)      401,845
                                                            --------   -----------     -----------     ---------
Restricted cash and equivalents of insurance operations...    27,062                                     27,062
Properties, net...........................................   242,463                                    242,463
Unamortized costs in excess of net assets of acquired
  companies...............................................   184,115                       25,797(c)    209,912
Net non-current assets of discontinued operations ........    15,822                                     15,822
Other assets..............................................    47,726                                     47,726
                                                            --------   -----------     -----------     ---------
                                                            $913,439    $   9,594       $  21,797      $944,830
                                                            --------   -----------     -----------     ---------
                                                            --------   -----------     -----------     ---------
      LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
Current liabilities:
     Current portion of long-term debt....................  $ 38,834    $               $              $ 38,834
     Accounts payable.....................................    48,178                                     48,178
     Accrued facilities relocation and corporate
       restructuring costs................................    35,970                                     35,970
     Other current liabilities............................    75,574                       (3,000)(d)    72,574
     Net current liabilities of discontinued operations...        --        9,779(a)                      9,594
                                                                             (185)(b)
                                                            --------   -----------     -----------     ---------
          Total current liabilities.......................   198,556        9,594          (3,000)      205,150
                                                            --------   -----------     -----------     ---------
Long-term debt............................................   540,355                                    540,355
Insurance loss reserves...................................    86,277                                     86,277
Deferred income taxes.....................................    41,404                                     41,404
Deposits and other liabilities............................    12,148                                     12,148
Minority interests........................................    27,654                      (27,654)(c)        --
Redeemable preferred stock, $12 stated value..............    71,794                                     71,794
Stockholders' equity (deficit):
     Class A common stock, $.10 par value.................     2,842                          269(c)      3,111
     Additional paid-in capital...........................    56,338                       55,932(c)    112,270
     Accumulated deficit..................................   (35,868)                      (3,750)(c)   (39,618)
     Class A common shares in treasury....................   (80,109)                                   (80,109)
     Other................................................    (7,952)                                    (7,952)
                                                            --------   -----------     -----------     ---------
          Total stockholders' equity (deficit)............   (64,749)          --          52,451       (12,298)
                                                            --------   -----------     -----------     ---------
                                                            $913,439    $   9,594       $  21,797      $944,830
                                                            --------   -----------     -----------     ---------
                                                            --------   -----------     -----------     ---------
</TABLE>
 
                                                        (footnotes on next page)
 
                                       37
 
<PAGE>
                    TRIARC COMPANIES, INC. AND SUBSIDIARIES
         PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET -- (CONTINUED)
 
(a) To  record  the  October 15,  1993  sale  of the  tree  maintenance services
    operations of the utility and municipal services business segment of  SEPSCO
    for  cash of $69,600,000 and liabilities assumed by the buyers of $5,000,000
    and the  related payment  of $24,136,000  of capitalized  leases secured  by
    assets  sold  and estimated  income taxes  and  expenses of  $2,623,000. The
    liabilities assumed, capitalized leases  repaid and estimated expenses  were
    included  in current net  assets of discontinued  operations. This adjusting
    entry as well as the entry in  (b) are necessary since the Triarc  Companies
    October 31 consolidation includes the August 31 accounts of SEPSCO.
 
(b) To record the October 7, 1993 sale of the construction related operations of
    the  utility and municipal services business segment of SEPSCO for a nominal
    amount of cash and the payment of $2,000,000 to be used to cover the buyer's
    short-term operating  losses and  working  capital requirements.  SEPSCO  is
    entitled  to deferred  purchase price  adjustments, of  which $1,815,000 had
    been received through December  31, 1993. Subsequent  to December 31,  1993,
    SEPSCO  expects  to receive  additional  net purchase  price  adjustments of
    $555,000,  consisting  of  proceeds  from  the  sale  of  fixed  assets  and
    collections  of receivables of $1,645,000  partially offset by capital lease
    repayments of $1,090,000.
 

(c) To record (i)  the issuance  of 2,691,822 shares  of Triarc  Class A  Common
    Stock  at an assumed issue price of  $21.25 per share (the closing price per
    share on March  2, 1994  as reported  on the  NYSE consolidated  transaction
    system)  net of estimated Triarc expenses of $1,000,000, in exchange for all
    of the shares of SEPSCO Common Stock owned by stockholders other than Triarc
    Companies, and  (ii)  the  resulting  elimination  of  Triarc's  $27,654,000
    minority interest and the related $25,797,000 increase in 'Unamortized costs
    in  excess  of  net  assets of  acquired  companies'  ('Goodwill')  based on
    preliminary  evaluations  of   purchase  accounting   (the  final   purchase
    accounting  may allocate certain of the  purchase price to assets other than
    Goodwill.)  The  increase  in  Goodwill  is  net  of  $3,750,000,  which  is
    considered  to be the  portion of the  merger consideration which represents
    the settlement of  the Ehrman Litigation.  Such amount has  been charged  to
    'Accumulated deficit', and has no tax benefit.

 
(d) To  record  Triarc Companies'  payment of  $3,000,000 of  estimated expenses
    related to the settlement  of the Ehrman Litigation,  all of which had  been
    previously accrued.
 
                                       38
 
<PAGE>
                    TRIARC COMPANIES, INC. AND SUBSIDIARIES
           PRO FORMA CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                    (IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
                                  (UNAUDITED)
 
<TABLE>
<CAPTION>
                                                                      FISCAL YEAR ENDED APRIL 30, 1993
                                                           ------------------------------------------------------
<S>                                                        <C>         <C>             <C>             <C>
                                                                                       ADJUSTMENTS
                                                                       ADJUSTMENTS       FOR THE
                                                                         FOR THE       MERGER AND
                                                               AS       COMPLETED      SETTLEMENT
                                                            REPORTED   TRANSACTIONS     AGREEMENT      PRO FORMA
                                                           ----------  -----------     -----------     ----------
Revenues.................................................. $1,058,274    $    --         $    --       $1,058,274
Costs and expenses:
  Cost of sales...........................................    766,795                                     766,795
  Selling, general and administrative expenses............    203,662      3,236(a)        1,032(d)       207,930
  Facilities relocation and corporate restructuring.......     43,000                                      43,000
  Provision for doubtful accounts from affiliates.........     10,358                                      10,358
                                                           ----------  -----------     -----------     ----------
                                                            1,023,815      3,236           1,032        1,028,083
                                                           ----------  -----------     -----------     ----------
     Operating profit.....................................     34,459     (3,236)         (1,032)          30,191
                                                           ----------  -----------     -----------     ----------
Interest expense..........................................    (72,830)      (888)(b)                      (73,718)
Other expense, net........................................       (920)                                       (920)
                                                           ----------  -----------     -----------     ----------
                                                              (73,750)      (888)                         (74,638)
                                                           ----------  -----------     -----------     ----------
     Loss from continuing operations before income taxes
       and minority interests.............................    (39,291)    (4,124)         (1,032)         (44,447)
Benefit from (provision for) income taxes.................     (8,608)     1,485(c)                        (7,123)
                                                           ----------  -----------     -----------     ----------
                                                              (47,899)    (2,639)         (1,032)         (51,570)
Minority interests in net losses..........................      3,350                     (1,894) (e)       1,456
                                                           ----------  -----------     -----------     ----------
     Loss from continuing operations...................... $  (44,549)   $(2,639)        $(2,926)      $  (50,114)
                                                           ----------  -----------     -----------     ----------
                                                           ----------  -----------     -----------     ----------
     Loss from continuing operations per share(f)......... $    (1.73)                                 $    (2.36)
                                                           ----------                                  ----------
                                                           ----------                                  ----------
</TABLE>
 
                                                  (Table continued on next page)
 
                                       39
 
<PAGE>
                    TRIARC COMPANIES, INC. AND SUBSIDIARIES
    PRO FORMA CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS -- (CONTINUED)
                    (IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
                                  (UNAUDITED)
 
(Table continued from previous page)
 
<TABLE>
<CAPTION>
                                                                                     SIX MONTHS ENDED OCTOBER 31, 1993
                                                                             --------------------------------------------------
<S>                                                                          <C>         <C>           <C>           <C>
                                                                                                       ADJUSTMENTS
                                                                                         ADJUSTMENTS     FOR THE
                                                                                           FOR THE      MERGER AND
                                                                                AS        COMPLETED     SETTLEMENT
                                                                             REPORTED    TRANSACTIONS   AGREEMENT    PRO FORMA
                                                                             --------    ------------  ------------  ----------
Revenues..................................................................   $521,470      $     --      $     --     $521,470
Costs and expenses:
  Cost of sales...........................................................    368,757                                  368,757
  Selling, general and administrative expenses............................    130,460           261(a)        516(d)   131,237
                                                                             --------    ------------  ------------  ----------
                                                                              499,217           261           516      499,994
                                                                             --------    ------------  ------------  ----------
     Operating profit.....................................................     22,253          (261)         (516)      21,476
                                                                             --------    ------------  ------------  ----------
Interest expense..........................................................    (32,924)         (954)(b)                (33,878)
Other expense, net........................................................     (2,256)                                  (2,256)
                                                                             --------    ------------  ------------  ----------
                                                                              (35,180)         (954)                   (36,134)
                                                                             --------    ------------  ------------  ----------
     Income from continuing operations before income taxes and minority
       interests..........................................................    (12,927)       (1,215)         (516)     (14,658)
Benefit from (provision for) income taxes.................................     (6,354)          438(c)                  (5,916)
                                                                             --------    ------------  ------------  ----------
                                                                              (19,281)         (777)         (516)     (20,574)
Minority interests in net income..........................................       (347)                        347(e)        --
                                                                             --------    ------------  ------------  ----------
     Loss from continuing operations......................................   $(19,628)     $   (777)     $   (169)    $(20,574)
                                                                             --------    ------------  ------------  ----------
                                                                             --------    ------------  ------------  ----------
     Loss from continuing operations per share(f).........................   $  (1.06)                                $   (.98)
                                                                             --------                                ----------
                                                                             --------                                ----------
</TABLE>
 
                                                        (footnotes on next page)
 
                                       40
 
<PAGE>
                    TRIARC COMPANIES, INC. AND SUBSIDIARIES
    PRO FORMA CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS -- (CONTINUED)
                                  (UNAUDITED)
 
(footnotes from previous page)
 
 (a) Reflects salaries and related employment benefits including bonuses for the
     new  chief executive officers  of RC Cola, Arby's  and National Propane and
     the annual accretion of  fair value of restricted  common stock grants  for
     the  chief executive officers of each  of Triarc's four core businesses for
     Fiscal 1993 and, to the extent not included in the historical results,  for
     the six months ended October 31, 1993.
 
 (b) Represents additions to (reductions in) interest expense as follows:
 
<TABLE>
<CAPTION>
                                                                                              SIX MONTHS
                                                                           YEAR ENDED           ENDED
                                                                         APRIL 30, 1993    OCTOBER 31, 1993
                                                                         --------------    ----------------
                                                                                   (IN THOUSANDS)
<S>                                                                      <C>               <C>
Repayment of Step-up Notes............................................      $     --           $ (7,585)
Repayment of AFC Exchange Agreement, Note and Loans...................       (26,385)            (1,120)
Repayment of term loans...............................................        (3,696)            (1,274)(1)
Repayment of accounts receivable financing and other debt.............        (7,008)            (1,608)(1)
Repayment of $9.0 million of RC/Arby's 16 7/8% Subordinated Debentures
  due 1996 (the '16 7/8% Debentures') and $1.0 million of RC/Arby's
  16 1/4% Senior Subordinated Debentures due 1996.....................        (1,673)              (520)
Issuance of 9 3/4% Senior Notes.......................................        26,813              9,806
Issuance of Graniteville Credit Facility (borrowings of $153,570,000
  and $152,616,000 respectively)......................................        12,257              3,090
Increase in amortization of deferred financing costs..................           580                165
                                                                         --------------        --------
                                                                            $    888           $    954
                                                                         --------------        --------
                                                                         --------------        --------
- ---------------
(1)  Includes  interest on  the Term  Loan and  Revolving Loan  of the
    Graniteville   Credit   Facility   of   $654,000   and   $789,000,
    respectively.
</TABLE>
 
 (c) To record the aggregate tax effect of the pre-tax entries at 36%.
 
 (d) To  record additional amortization relating to the exchange of Triarc Class
     A Common Stock for the SEPSCO Common Stock owned by stockholders other than
     Triarc Companies. The $25,797,000 of additional Goodwill has been amortized
     over an  estimated  average of  25  years.  The 25  year  weighted  average
     reflects  the  preliminary evaluation  of  purchase accounting  whereas the
     final purchase accounting  may allocate  certain of the  purchase price  to
     assets  for which the amortization period  would be less than the remaining
     30 year life for Goodwill.
 
 (e) To eliminate the minority interest  in the loss from continuing  operations
     of  SEPSCO due to the assumed  acquisition pursuant to the Merger Agreement
     of all the  SEPSCO Common  Stock owned  by stockholders  other than  Triarc
     Companies.
 
 (f) The loss from continuing operations per share is determined by dividing the
     loss  from continuing operations less preferred stock dividend requirements
     (pro forma for Fiscal 1993 as if the Redeemable Convertible Preferred Stock
     was issued  as of  May 1,  1992 and  historical for  the six  months  ended
     October  31, 1993) by  the weighted average  common shares outstanding. The
     weighted average common shares outstanding were determined as follows:
 
<TABLE>
<CAPTION>
                                                                                              SIX MONTHS
                                                                           YEAR ENDED           ENDED
                                                                         APRIL 30, 1993    OCTOBER 31, 1993
                                                                         --------------    ----------------
                                                                                   (IN THOUSANDS)
<S>                                                                      <C>               <C>
Historical............................................................       25,808             21,239
Effect of the issuance of 833,332 shares of Triarc Class A Common
  Stock in the Equity Transactions....................................          817                 --
Effect of the acquisition by Triarc of 5,982,866 shares of Triarc
  Class A Common Stock in the Equity Transactions.....................       (5,868)                --
Effect of grant of 268,000 shares of restricted Triarc Class A Common
  Stock issued in connection with the Restructuring...................          263                 --
Effect of the issuance of 2,691,822 shares of Triarc Class A Common
  Stock in the Merger.................................................        2,692              2,692
                                                                            -------            -------
Pro forma.............................................................       23,712             23,931
                                                                            -------            -------
                                                                            -------            -------
</TABLE>
 
                                       41
 
<PAGE>
              SOUTHEASTERN PUBLIC SERVICE COMPANY AND SUBSIDIARIES
                         PRO FORMA FINANCIAL STATEMENTS
 
     The following  unaudited pro  forma condensed  consolidated SEPSCO  balance
sheet  as of November  30, 1993 (the  'SEPSCO Pro Forma  Balance Sheet') and pro
forma condensed consolidated SEPSCO statements of operations for the fiscal year
ended February 28, 1993 and the nine months ended November 30, 1993 (the 'SEPSCO
Pro Forma Statements of Operations' and  collectively with the SEPSCO Pro  Forma
Balance Sheet, the 'SEPSCO Pro Forma Financial Statements' have been prepared by
adjusting  the  SEPSCO historical  condensed  consolidated balance  sheet  as of
November 30, 1993 and consolidated statements of operations for the fiscal  year
ended  February 28, 1993 and  the nine months ended  November 30, 1993 appearing
elsewhere herein. The  historical financial  statements have  been adjusted,  as
applicable,  to  give  effect  to  (i)  the  sale  of  the  construction related
operations of the utility and municipal services business segment and (ii)  have
been  further adjusted to give effect to  the Merger and the payment of expenses
related to the settlement of the Ehrman Litigation in connection with the Merger
and Settlement Agreement as if such transactions had occurred as of November 30,
1993 for the  SEPSCO Pro Forma  Balance Sheet and  as of March  1, 1992 for  the
SEPSCO  Pro  Forma  Statements of  Operations.  Such pro  forma  adjustments are
described in the accompanying notes to the SEPSCO Pro Forma Financial Statements
which should  be  read  in  conjunction with  the  SEPSCO  Pro  Forma  Financial
Statements.  The SEPSCO  Pro Forma Financial  Statements should also  be read in
conjunction with the SEPSCO consolidated financial statements included elsewhere
herein. The  SEPSCO  Pro  Forma  Financial  Statements  do  not  purport  to  be
indicative  of the actual financial position  or results of operations of SEPSCO
had such transactions actually been consummated on November 30, 1993 or March 1,
1992, respectively, or of the future financial position or results of operations
of SEPSCO which will result from the consummation of such transactions.
 
                                       42
 
<PAGE>
              SOUTHEASTERN PUBLIC SERVICE COMPANY AND SUBSIDIARIES
                 PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET
                               NOVEMBER 30, 1993
                                  (UNAUDITED)
 
<TABLE>
<CAPTION>
                                                                                        ADJUSTMENTS
                                                                        ADJUSTMENTS       FOR THE
                                                                          FOR THE       MERGER AND
                                                                         COMPLETED      SETTLEMENT
                                                         AS REPORTED    TRANSACTIONS     AGREEMENT        PRO FORMA
                                                         -----------    ------------    -----------       ---------
<S>                                                      <C>            <C>             <C>               <C>
                        ASSETS
Current assets:
    Cash and equivalents..............................    $  41,111         $300(a)      $  (1,000)(b)    $ 40,411
    Receivables, net..................................        3,884                                          3,884
    Inventories.......................................          888                                            888
    Deferred income tax benefit.......................        1,062                                          1,062
    Other current assets..............................          534                                            534
                                                         -----------       -----        -----------       ---------
         Total current assets.........................       47,479          300            (1,000)         46,779
                                                         -----------       -----        -----------       ---------
Properties, net.......................................        7,298                                          7,298
Note receivable from Triarc...........................       26,538                                         26,538
Investments in affiliates.............................       68,033                                         68,033
Unamortized costs in excess of net assets of acquired
  companies...........................................       --                             25,797(c)       25,797
Deferred income tax benefit...........................          528                                            528
Other assets..........................................        2,483                                          2,483
Net non-current assets of discontinued operations.....       18,771                                         18,771
                                                         -----------       -----        -----------       ---------
                                                          $ 171,130          300         $  24,797        $196,227
                                                         -----------       -----        -----------       ---------
                                                         -----------       -----        -----------       ---------
                   LIABILITIES AND
                 STOCKHOLDERS' EQUITY
Current liabilities:
    Current portion of long-term debt.................    $   9,287         $            $                $  9,287
    Accounts payable..................................        8,690                                          8,690
    Accrued expenses..................................        4,190                         (1,000)(b)       3,190
    Net current liabilities of discontinued
       operations.....................................        3,406          300(a)                          3,706
                                                         -----------       -----        -----------       ---------
         Total current liabilities....................       25,573          300            (1,000)         24,873
                                                         -----------       -----        -----------       ---------
Long-term debt........................................       50,501                                         50,501
Other liabilities.....................................        1,484                                          1,484
Commitments and contingencies
Stockholders' equity:
    Series B convertible preferred stock, $50 par
       value..........................................           24                                             24
    Common stock, $1.00 par value.....................       11,896                                         11,896
    Capital in excess of par value....................       90,539                         25,797(c)      116,336
    Accumulated deficit...............................       (8,021)                                        (8,021 )
                                                         -----------       -----        -----------       ---------
                                                             94,438                         25,797         120,235
    Common shares in treasury.........................         (866)                                          (866 )
                                                         -----------       -----        -----------       ---------
         Total stockholders' equity...................       93,572                         25,797         119,369
                                                         -----------       -----        -----------       ---------
                                                          $ 171,130         $300         $  24,797        $196,227
                                                         -----------       -----        -----------       ---------
                                                         -----------       -----        -----------       ---------
</TABLE>
 
- ------------
(a) To record an increase to  cash relating to the October  7, 1993 sale of  the
    construction  related  operations  of  the  utility  and  municipal services
    business segment. Such operations were sold for a nominal amount of cash and
    the payment  of  $2,000,000 to  be  used  to cover  the  buyer's  short-term
    operating  losses and  working capital  requirements. SEPSCO  is entitled to
    deferred purchase price adjustments, of  which $1,515,000 had been  received
    through  November 30, 1993, the balance  sheet date, and of which $1,815,000
    had been  received through  December 31,  1993. Subsequent  to December  31,
    1993,  SEPSCO expects  to receive  additional purchase  price adjustments of
    $555,000,  consisting  of  proceeds  from  the  sale  of  fixed  assets  and
    collections  of receivables of $1,645,000  partially offset by capital lease
    repayments of $1,090,000.
(b) To record SEPSCO's payment  of $1,000,000 of  estimated expenses related  to
    the  settlement of the  Ehrman Litigation, all of  which had been previously
    accrued for.
(c) To record the  increases in 'Unamortized  costs in excess  of net assets  of
    acquired  companies'  ('Goodwill')  and  'Capital in  excess  of  par value'
    resulting from the assumed pushdown of  such unamortized costs in excess  of
    net  assets of acquired companies to SEPSCO from Triarc based on preliminary
    evaluations of  purchase  accounting  (the  final  purchase  accounting  may
    allocate certain of the purchase price to assets other than Goodwill).
 
                                       43
 
<PAGE>
              SOUTHEASTERN PUBLIC SERVICE COMPANY AND SUBSIDIARIES
           PRO FORMA CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                    (IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
                                  (UNAUDITED)
 
<TABLE>
<CAPTION>
                                                                              FISCAL YEAR ENDED FEBRUARY 28, 1993
                                                                              ------------------------------------
                                                                                          ADJUSTMENTS
                                                                                            FOR THE
                                                                                          MERGER AND
                                                                                 AS       SETTLEMENT
                                                                              REPORTED     AGREEMENT     PRO FORMA
                                                                              --------    -----------    ---------
<S>                                                                           <C>         <C>            <C>
Net sales..................................................................   $ 28,520      $            $ 28,520
                                                                              --------                   ---------
Cost and expenses:
     Cost of sales.........................................................     22,604                     22,604
     Selling, general and administrative expenses..........................      2,282        1,032(a)      3,314
                                                                              --------    -----------    ---------
                                                                                24,886        1,032        25,918
                                                                              --------    -----------    ---------
          Operating profit.................................................      3,634       (1,032)        2,602
                                                                              --------    -----------    ---------
Other income (expense):
     Interest expense......................................................    (13,901)                   (13,901)
     Equity in earnings of affiliates before cumulative effect of changes
       in accounting principles and extraordinary items of affiliate.......     12,161                     12,161
     Interest income from Triarc...........................................      7,336                      7,336
     Gain on sale of marketable security...................................      6,000                      6,000
     Other, net............................................................       (987)                      (987)
                                                                              --------                   ---------
                                                                                10,609                     10,609
                                                                              --------                   ---------
Income from continuing operations before income taxes, cumulative effect of
  changes in accounting principles and extraordinary items of affiliate....     14,243       (1,032)       13,211
Provision for income taxes.................................................     (1,671)                    (1,671)
                                                                              --------    -----------    ---------
Income from continuing operations before equity in cumulative effect of
  changes in accounting principles and extraordinary items of affiliate....   $ 12,572      $(1,032)     $ 11,540
                                                                              --------    -----------    ---------
                                                                              --------    -----------    ---------
Income from continuing operations per share(b).............................      $1.08                      $1.39
                                                                                    (Table continued on next page)
</TABLE>
 
                                       44
 
<PAGE>
              SOUTHEASTERN PUBLIC SERVICE COMPANY AND SUBSIDIARIES
           PRO FORMA CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                    (IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
                                  (UNAUDITED)
 
<TABLE>
<CAPTION>
                                                                             NINE MONTHS ENDED NOVEMBER 30, 1993
                                                                         -------------------------------------------
                                                                                      ADJUSTMENTS
                                                                                        FOR THE
                                                                                       MERGER AND
                                                                            AS         SETTLEMENT
                                                                         REPORTED      AGREEMENT         PRO FORMA
                                                                         --------    --------------    -------------
<S>                                                                      <C>         <C>               <C>
Net sales.............................................................   $19,760         $                $19,760
                                                                         --------                      -------------
Costs and expenses:
     Cost of sales....................................................    16,408                           16,408
     Selling, general and administrative expenses.....................     2,998            774(a)          3,772
                                                                         --------        ------        -------------
                                                                          19,406            774            20,180
                                                                         --------        ------        -------------
          Operating profit (loss).....................................       354           (774)             (420)
                                                                         --------        ------        -------------
Other income (expense):
     Interest expense.................................................    (7,521)                         (7,521)
     Equity in earnings of affiliates before cumulative effect of
       changes in accounting principles...............................     4,310                            4,310
     Interest income from Triarc......................................     3,141                            3,141
     Other............................................................      (892)                           (892)
                                                                         --------                      -------------
                                                                            (962)                           (962)
                                                                         --------                      -------------
Loss from continuing operations before income taxes and cumulative
  effect of changes in accounting principles..........................      (608)         (774)           (1,382)
Benefit from income taxes.............................................     1,791                            1,791
                                                                         --------        ------        -------------
Income from continuing operations before cumulative effect of changes
  in accounting principles............................................   $ 1,183         $ (774)          $   409
                                                                         --------        ------        -------------
                                                                         --------        ------        -------------
Income from continuing operations per share(b)........................      $.10                             $.05
</TABLE>
 
- ------------
(a) To  record amortization  relating to the  exchange of Triarc  Class A Common
    Stock for the SEPSCO  Common Stock owned by  stockholders other than  Triarc
    Companies. The $25,797,000 of additional Goodwill has been amortized over an
    estimated  average of  25 years. The  25 year weighted  average reflects the
    preliminary evaluation  of purchase  accounting whereas  the final  purchase
    accounting  may allocate certain  of the purchase price  to assets for which
    the amortization period would  be less than the  remaining 30 year life  for
    Goodwill.
(b) The  income from continuing  operations per share  is determined by dividing
    the  income  from  continuing  operations  less  preferred  stock   dividend
    requirements  by the weighted average  common shares outstanding (11,655,067
    shares for historical and 8,290,289 shares for pro forma after giving effect
    to the exchange of 3,364,778 shares of SEPSCO Common Stock for Triarc  Class
    A Common Stock in connection with the Merger).
 
                                       45

<PAGE>
                              THE MERGER AGREEMENT
 
GENERAL
 
     The  terms of the Merger  are contained in the  Merger Agreement, a copy of
which is attached as Annex I to this Proxy Statement-Prospectus and incorporated
herein by reference. Statements in this Proxy Statement-Prospectus with  respect
to  the terms of the Merger are qualified  in their entirety by reference to the
Merger Agreement. SEPSCO  Stockholders are urged  to read the  full text of  the
Merger Agreement.
 
     Under  the  Merger  Agreement, if  the  Merger  is approved  by  the SEPSCO
Stockholders and becomes effective,  Mergerco will merge  with and into  SEPSCO,
and  SEPSCO,  as the  Surviving  Corporation in  the  Merger, will  continue its
corporate existence  under the  laws of  Delaware under  the name  'Southeastern
Public  Service  Company.'  The Surviving  Corporation  will be  a  wholly owned
subsidiary of Triarc.
 
EFFECTIVE TIME OF MERGER
 
     The Effective  Time of  the Merger  will  be at  the time  of filing  of  a
Certificate  of Merger with the  Secretary of State of  the State of Delaware in
accordance with applicable Delaware  law. It is  presently anticipated that  the
filing  of the Certificate of  Merger will be made  as soon as practicable after
the conclusion of the Special Meeting.  Such filing will be made, however,  only
upon  satisfaction or waiver, where permissible,  of the conditions set forth in
the Merger Agreement. See ' -- Conditions to the Merger.'
 
CONVERSION OF STOCK
 
     At the Effective Time, each outstanding share of SEPSCO Common Stock (other
than shares of SEPSCO Common  Stock owned by Triarc  or a subsidiary of  Triarc,
which  will  be cancelled)  automatically will  be converted  into the  right to
receive 0.8 of a share of Triarc Class A Common Stock.
 
     At  the  Effective  Time,  each  share  of  SEPSCO  Preferred  Stock   will
automatically be cancelled.
 
     Upon  the  Effective Time,  holders of  shares of  SEPSCO Common  Stock and
shares of SEPSCO Preferred Stock will have no continuing interests in or  rights
as stockholders of SEPSCO.
 
     Each share of Mergerco's common stock, par value $1.00 per share ('Mergerco
Common  Stock'), issued and outstanding immediately  prior to the Effective Time
shall, by virtue of the Merger and without any action on the part of Triarc,  be
converted  into and become one share of Common Stock, par value $1.00 per share,
of the Surviving Corporation.
 
     Only holders  of shares  of SEPSCO  Preferred Stock  have the  right  under
Section 262 to dissent from the Merger and obtain an appraisal of the fair value
of  such shares pursuant to  Section 262 if the  Merger is consummated. However,
because Triarc holds all  outstanding shares of SEPSCO  Preferred Stock and  has
agreed to vote such shares for the adoption of the Merger Agreement, it will not
be able to exercise its appraisal rights under Section 262.
 
PAYMENT FOR SEPSCO COMMON STOCK
 
     In  order to receive the Merger  Consideration, each holder of certificates
(each, a 'Certificate') theretofore representing  shares of SEPSCO Common  Stock
will  be required to surrender his  or her Certificate or Certificates, together
with a duly executed and properly completed letter of transmittal and any  other
required  documents,  to  Harris  Trust  Company of  New  York,  which  has been
appointed by Triarc as the Exchange  Agent. Upon receipt of such Certificate  or
Certificates,  together with  a duly executed  and properly  completed letter of
transmittal and any  other required  documents from  a holder  of SEPSCO  Common
Stock,  the Exchange  Agent will  arrange for the  issuance and  delivery to the
person or persons entitled thereto of a certificate or certificates representing
that number  of  whole shares  of  Triarc Class  A  Common Stock  equal  to  0.8
multiplied  by the number  of shares of  SEPSCO Common Stock  represented by the
surrendered Certificate or Certificates. Shares  of Triarc Class A Common  Stock
will  be issued only in whole shares.  Former holders of shares of SEPSCO Common
 
                                       46
 
<PAGE>
Stock will not  be entitled to  receive fractions  of shares of  Triarc Class  A
Common  Stock ('Fractional  Shares') but, instead,  will be  entitled to receive
promptly from the Exchange Agent a cash payment in lieu of Fractional Shares  in
an  amount  equal to  such  former holder's  proportionate  interest in  the net
proceeds from the sale in  the open market by the  Exchange Agent, on behalf  of
all such former holders, of the aggregate Fractional Shares.
 
     No  dividends  or other  distributions that  are  otherwise payable  on the
shares of Triarc Class A Common Stock issued in connection with the Merger  will
be paid to the holder of any unsurrendered Certificate until such Certificate is
properly  surrendered to the Exchange Agent.  However, upon the proper surrender
of such Certificate to the Exchange Agent (i) there shall be paid to the  person
in  whose name  the shares  of Triarc Class  A Common  Stock constituting Merger
Consideration are issued  the amount  of any  dividends that  shall have  become
payable  with respect to such shares of  Triarc Class A Common Stock between the
Effective Time of  the Merger and  the time of  such surrender and  (ii) at  the
appropriate  payment date or  as soon thereafter as  practicable, there shall be
paid to such person the amount of any dividends on such shares of Triarc Class A
Common Stock that shall have a record or due date prior to such surrender and  a
payment  date after such surrender,  subject in each such  case to (x) deduction
therefrom of any amount required by applicable  law to be withheld, and (y)  any
applicable  escheat laws  or unclaimed property  laws. On proper  surrender of a
Certificate, no interest shall  be payable with respect  to the payment of  such
dividends  and no interest  shall be payable  with respect to  the amount of any
cash payable in lieu of a fractional share of Triarc Class A Stock.
 
     If the  Merger Consideration  is to  be paid  to a  person other  than  the
registered  holder of  the Certificates surrendered,  it is a  condition of such
issuance that  the  Certificate  or  Certificates  so  surrendered  be  properly
endorsed  or  otherwise be  in  proper form  for  transfer and  that  the person
requesting such  payment  or issuance  either  pay  to the  Exchange  Agent  any
transfer  or other taxes  required by reason  of the issuance  to a person other
than the  registered owner  of the  Certificate or  Certificates surrendered  or
shall  establish to the satisfaction of Triarc that such tax has been paid or is
not applicable.
 
     The Exchange Agent will send instructions to holders of SEPSCO Common Stock
with regard to the procedure for  surrendering Certificates in exchange for  the
Merger  Consideration, together with a letter of transmittal to be used for this
purpose, as promptly as practicable after the Effective Time. Holders of  SEPSCO
Common Stock should surrender Certificates only with a letter of transmittal.
 
     SEPSCO  STOCKHOLDERS  SHOULD NOT  SEND ANY  CERTIFICATES WITH  THE ENCLOSED
PROXY CARD.
 
CERTIFICATE OF INCORPORATION, BY-LAWS, DIRECTORS
 
     The Merger Agreement provides that, at the Effective Time, the  Certificate
of  Incorporation  of  SEPSCO  and  By-laws  of  Mergerco,  each  as  in  effect
immediately  prior  to  the  Effective   Time,  shall  be  the  Certificate   of
Incorporation  and  By-laws of  the Surviving  Corporation,  except that  at the
Effective Time  Article  Fourth  of  the Certificate  of  Incorporation  of  the
Surviving  Corporation shall be amended to read as follows: 'The total number of
shares of stock of all classes which  the Corporation has authority to issue  is
1,000  shares of Common Stock, par value  $1.00 per share.' The Merger Agreement
also provides  that the  officers of  SEPSCO and  directors of  Mergerco at  the
Effective  Time shall  be the  initial officers  and directors  of the Surviving
Corporation and shall serve until  their respective successors are duly  elected
or  appointed  and  qualify  in  the  manner  provided  in  the  Certificate  of
Incorporation and By-laws of the Surviving Corporation, or as otherwise provided
by law.
 
CONDITIONS TO THE MERGER
 
     The obligations of each  of Triarc, Mergerco and  SEPSCO to consummate  the
Merger are subject to fulfillment of the following conditions at or prior to the
Effective Time: (i) the Merger Agreement shall have been adopted by the Required
Stockholder  Vote, (ii) the  Registration Statement shall  have become effective
under the Securities Act and no  stop order suspending such effectiveness  shall
have  been issued or proceeding for such purpose instituted or threatened; (iii)
no order, statute, rule, regulation, executive order, stay, decree, judgment  or
injunction  shall have  been enacted,  entered, promulgated  or enforced  by any
court  or  governmental  authority   which  prevents  or  materially   restricts
 
                                       47
 
<PAGE>
consummation  of the Merger, (iv) the District  Court shall have entered a Final
Order approving the Settlement Agreement and the Settlement Terms and Conditions
set forth  therein and  dismissing  the Ehrman  Litigation  on the  merits  with
prejudice  (the 'Settlement Condition'), (v) the shares of Triarc Class A Common
Stock to be issued as Merger Consideration shall have been approved for  listing
on  each stock exchange located  in the United States  of America upon which the
shares of  Triarc Class  A Common  Stock are  then listed,  subject to  official
notice  of issuance, and  (vi) Smith Barney  shall not have  withdrawn or in any
material way modified or amended its opinion with respect to the fairness from a
financial point of view of the Merger Consideration to the Public Stockholders.
 
     The obligation of SEPSCO to effect the Merger is subject to fulfillment  of
the  following  additional conditions  at or  prior to  the Effective  Time: (i)
Triarc and  Mergerco shall  have  performed their  agreements contained  in  the
Merger  Agreement in all  material respects, (ii) except  as contemplated by the
Merger Agreement, the representations and warranties of Triarc and Mergerco  set
forth in the Merger Agreement shall be true and correct in all material respects
at and as of the Effective Time as if made at and as of such date, unless stated
in the Merger Agreement to be true on and as of another date, in which case such
representation and warranty shall have been true in all material respects on and
as  of such date and  (iii) since the date of  the Merger Agreement, there shall
not have been (a) any  material adverse change, or  any development, not in  the
ordinary  course of business,  which is likely  to result in  a material adverse
change in the business, assets, financial condition or the results of operations
of Triarc and its subsidiaries (excluding SEPSCO and its subsidiaries), taken as
a whole; (b) any change in accounting methods, principles or practices by Triarc
materially affecting its assets, liabilities or business, except insofar as  may
have  been required by a change in generally accepted accounting principles; (c)
any damage, destruction or loss which,  after taking into account any  insurance
proceeds  with  respect thereto,  would have  a material  adverse effect  on the
business, assets, properties,  financial condition or  results of operations  of
Triarc  and its subsidiaries (excluding SEPSCO  and its subsidiaries) taken as a
whole.
 
     The obligations of Triarc and Mergerco to effect the Merger are subject  to
fulfillment  of the following additional conditions at or prior to the Effective
Time: (i) subject to the Control Agreement (as defined below under ' --  Certain
Agreements  Pending  the Merger  -- Agreements  of  Triarc'), SEPSCO  shall have
performed its agreements under  the Merger Agreement  in all material  respects;
(ii)  except as  contemplated by the  Merger Agreement,  the representations and
warranties of SEPSCO shall be true and  correct in all material respects at  and
as of the Effective Time as if made at and as of such date, unless stated in the
Merger  Agreement  to be  true  on and  as  of such  date,  in which  event such
representation and warranty shall have been true in all material respects on and
as of such date; (iii) there shall  not have occurred and be continuing (a)  any
general suspension of trading in, or limitation on prices for, securities on the
NYSE  or any  exchange on which  the shares of  Triarc Class A  Common Stock are
listed for trading  (b) a  declaration of  banking moratorium  or suspension  of
payments  of banks generally in the United States, whether or not mandatory, (c)
certain wars or other international or national calamities materially  affecting
the  United States which commenced  after the date of  the Merger Agreement, (d)
any limitation, whether or not mandatory,  by any governmental authority on,  or
other  event reasonably likely to  affect extension of credit  by banks or other
lending institutions in  the United States,  or (e) any  other material  adverse
change  in the  United States  securities or  financial markets,  which material
adverse change shall  be deemed  to have occurred  if the  closing Standard  and
Poor's  500 Stock Index  (the 'S&P 500  Index') on the  business day immediately
preceding the day on which the Special Meeting is held at which the vote on  the
Merger  Agreement is taken, is at least 12%  less than the closing S&P 500 Index
on the business day immediately preceding the date of the Merger Agreement; (iv)
there shall not have  been any action taken,  or any statute, rule,  regulation,
legislation,  interpretation,  judgment, order  or injunction  enacted, entered,
enforced, promulgated, amended, issued or deemed applicable to the Merger by any
domestic legislative body, court, government or governmental, administrative  or
regulatory authority or agency (a) restraining or preventing the carrying out of
the  transactions contemplated by the  Merger Agreement (b) prohibiting Triarc's
ownership or  operation  of all  or  any material  portion  of its  or  SEPSCO's
businesses or assets, or compelling Triarc to dispose of or hold separate all or
any material portion of Triarc's or SEPSCO's businesses or assets as a result of
the transactions contemplated by the Merger Agreement; (c) making acquisition of
the  shares  of  SEPSCO  Common  Stock  pursuant  to  the  Merger  illegal;  (d)
prohibiting
 
                                       48
 
<PAGE>
Triarc effectively  from  acquiring or  holding  or exercising  full  rights  of
ownership  of the shares of SEPSCO  Common Stock, including, without limitation,
the right to vote the shares of  SEPSCO Common Stock acquired by it pursuant  to
the Merger, on all matters properly presented to the stockholders of SEPSCO; (e)
prohibiting  Triarc or  any of its  subsidiaries or  affiliates from effectively
controlling in  any material  respect the  businesses or  operations of  SEPSCO,
Triarc or their respective subsidiaries; or (f) which would impose any condition
which  would  materially  adversely  affect  the business  of  SEPSCO  or  (as a
condition of consummating the transactions contemplated by the Merger Agreement)
the  business  of  Triarc  and  its  subsidiaries  (excluding  SEPSCO  and   its
subsidiaries) taken as a whole; (v) there shall not have been any federal income
tax   changes   (including   any  legislation,   regulation,   or   judicial  or
administrative interpretations)  adopted,  or  proposed  by  the  United  States
Treasury  Department or by the Chairman or ranking minority member of either the
Ways and Means Committee (the 'Ways  and Means Committee') of the United  States
House  of Representatives (the  'House') or the  Finance Committee (the 'Finance
Committee') of the United States Senate (the 'Senate'), or favorably reported to
either the full House or Senate by  the Ways and Means Committee or the  Finance
Committee,  on or subsequent to the date of the Merger Agreement that would make
consummation of the Merger impracticable; (vi)  the SEPSCO Board shall not  have
withdrawn  or modified  its position  with respect  to the  Merger; (vii) except
actions taken by SEPSCO  in connection with its  decision to sell  substantially
all  of  its businesses  and assets  as they  exist  on the  date of  the Merger
Agreement, and the restatement of  SEPSCO's 1993 audited consolidated  financial
statements  and unaudited quarterly consolidated financial statements to reflect
the discontinuance of such businesses and  assets, since the date of the  Merger
Agreement,  since the date of the Merger Agreement there shall not have been (a)
any material adverse change, or any  development, not in the ordinary course  of
business,  which  is  likely to  result  in  a material  adverse  change  in the
business, assets, financial condition or the results of operations of SEPSCO and
its subsidiaries,  taken as  a  whole; (b)  any  change in  accounting  methods,
principles  or practices  by SEPSCO  materially adversely  affecting its assets,
liabilities or business, except insofar as may have been required by a change in
generally accepted accounting  principles; (c) any  damage, destruction or  loss
which,  after taking into account any  insurance coverage proceeds received with
respect thereto, would have a material  adverse effect on the business,  assets,
properties,  financial  condition or  results of  operations  of SEPSCO  and its
subsidiaries taken  as  a  whole;  and (viii)  the  Final  Order  approving  the
Settlement Agreement shall have become final and non-appealable.
 
CERTAIN AGREEMENTS PENDING THE MERGER
 
AGREEMENT OF SEPSCO
 
     In  the Merger  Agreement, SEPSCO has  agreed that, prior  to the Effective
Time, unless Triarc otherwise agrees, or as otherwise contemplated by the Merger
Agreement, neither  SEPSCO nor  any subsidiary  of SEPSCO  shall (i)  amend  its
certificate of incorporation or by-laws, (ii) change the number of authorized or
outstanding  shares  of  its  capital  stock,  from  the  number  authorized and
outstanding on the date of the Merger Agreement, (iii) declare, set aside or pay
any dividend  or other  distribution, or  make  any payment  in cash,  stock  or
property,  in respect  of any  shares of its  capital stock,  except for regular
dividends and/or distributions  declared and/or  paid (a) by  any subsidiary  of
SEPSCO to SEPSCO or to any other subsidiary of SEPSCO, or (b) on the outstanding
shares  of SEPSCO  Preferred Stock, (iv)  authorize for  issuance, issue, grant,
sell, pledge or dispose of, or propose to issue, grant, sell, pledge or  dispose
of  any shares of, or warrants, options, commitments, subscriptions or rights of
any kind  to  acquire  any shares  of,  the  capital stock  of  SEPSCO  or  such
subsidiary  or any securities convertible into or exchangeable for shares of any
such capital stock, (v) incur any material indebtedness for borrowed money other
than in  the  ordinary  and  usual course  of  business,  consistent  with  past
practice,  (vi) acquire  directly or indirectly  by redemption  or otherwise any
shares of the  capital stock of  SEPSCO or  any subsidiary of  SEPSCO, or  (vii)
enter  into any  agreement or  take any  other action  to do  any of  the things
described above or which would make any representation or warranty of SEPSCO set
forth in the  Merger Agreement  that is qualified  as to  materiality untrue  or
incorrect  and any  such representation  or warranty  which is  not so qualified
materially untrue or incorrect.
 
                                       49
 
<PAGE>
AGREEMENTS OF TRIARC
 
     In the Merger  Agreement, Triarc  has agreed  that prior  to the  Effective
Time,  unless SEPSCO otherwise agrees, Triarc shall  not issue any shares of its
capital stock  (or issue  or grant  any options,  warrants or  other  securities
evidencing  the right  to acquire,  prior to the  Effective Time,  shares of its
capital stock upon the exercise  or conversion thereof (collectively  'Rights'))
to  any executive officer or  director of Triarc, or  any affiliate of Triarc or
any such person, other than (i) upon exercise of Rights outstanding on the  date
of  the Merger  Agreement, (ii) pursuant  to Triarc's 1993  Amended and Restated
Equity Participation  Plan  (the  'Equity Participation  Plan')  or  (iii)  upon
receipt  of consideration equal to at least  the fair market value of the shares
of Triarc  capital stock  issued in  respect thereof  (or, in  the case  of  the
issuance  of  shares of  capital stock  upon  the exercise  of any  Right issued
subsequent to the date  of the Merger Agreement,  upon receipt of  consideration
(including the consideration, if any, received by Triarc for the issuance of the
Right)  equal to at least the  fair market value, as of  the date of issuance of
the Right, of  the shares of  Triarc capital  stock to be  issued upon  exercise
thereof). Any non-cash consideration shall be valued in good faith by the Triarc
Board.
 
     Pursuant  to the  Merger Agreement,  and as  required by  the terms  of the
Settlement Agreement, Triarc has also agreed that it shall not issue any  shares
of Triarc Class A Common Stock or Triarc Class B Common Stock (together, 'Triarc
Common  Shares'),  or  Rights to  acquire  Triarc Common  Shares,  subsequent to
October 18, 1993 (the date on  which the Settlement Agreement was executed)  and
prior  to the  Effective Time,  which will  have a  materially dilutive economic
effect upon the  Triarc Common Shares,  except that the  following shall not  be
deemed to have any such materially dilutive economic effect for purposes of such
agreement:  (i) the granting of stock options or restricted stock awards so that
the aggregate number of Triarc Common Shares  to be issued upon the issuance  of
such  restricted stock  awards, and upon  the conversion of  such stock options,
does not exceed 3,500,000 shares; or (ii) the issuance or potential issuance  of
Triarc  Common Shares,  upon the  election to  convert by  any holders,  at such
holders' option,  of  all  or  some of  the  shares  of  Redeemable  Convertible
Preferred  Stock or  any other  series of  convertible preferred  stock or other
convertible securities of Triarc outstanding on  October 18, 1993; or (iii)  the
issuance  or potential issuance of shares  of Triarc Common Shares in connection
with an underwritten public offering; or (iv) the issuance or potential issuance
of Triarc Common Shares  at not less  than fair market  value, as determined  in
good  faith by the Triarc Board; or (v) any other such issuance of Triarc Common
Shares, so long as  the number of shares  of Triarc Class A  Common Stock to  be
received in exchange for each share of SEPSCO Common Stock pursuant to the terms
of the Settlement Agreement and the Merger Agreement are appropriately adjusted.
 
     In  addition, Triarc,  either in  its capacity  as a  SEPSCO Stockholder or
through its  nominees on  the SEPSCO  Board (which  for purposes  of the  Merger
Agreement  mean Messrs. Peltz,  May and Kalvaria),  in each case  subject to the
exercise  of  their  respective  fiduciary   duties,  if  any,  to  the   SEPSCO
Stockholders,  has agreed not to take  or fail to take, as  the case may be, any
action, the taking or  failure of which to  take, as the case  may be, would  be
likely to cause any representation or warranty of SEPSCO contained in the Merger
Agreement  to cease  to be  accurate in  any material  respect or  that would be
reasonably likely to prevent the performance in all material respects by  SEPSCO
of  any covenant or the satisfaction by SEPSCO of any condition contained in the
Merger Agreement  (the foregoing  agreement being  referred to  as the  'Control
Agreement').
 
AGREEMENTS OF SEPSCO, TRIARC AND MERGERCO
 
     In the Merger Agreement, each party agrees to use its best efforts to take,
or  cause to be  taken, all lawful  action, to do,  or cause to  be done, and to
assist and  cooperate  with the  other  parties  thereto in  doing,  all  things
necessary,  proper  or  advisable  under  applicable  laws  and  regulations  to
consummate  and  make  effective,  as   soon  as  reasonably  practicable,   the
transactions  contemplated by  the Merger  Agreement, including  (i) the Merger,
(ii) the obtaining of consents, amendments to or waivers under the terms of  any
material  borrowing  arrangements  or  other  material  contractual arrangements
required by the transactions contemplated by the Merger Agreement, and (iii) the
defending of  any  lawsuits or  other  legal proceedings,  whether  judicial  or
administrative,  challenging  the Merger  Agreement or  the consummation  of the
transactions contemplated thereby. Each of  the parties to the Merger  Agreement
 
                                       50
 
<PAGE>
also  agreed not to take or to fail to take, as the case may be, any action, the
taking of which or the failure  of which to take, as  the case may be, would  be
likely to cause any representation or warranty contained in the Merger Agreement
to  cease  to be  true or  accurate in  any  material respect  or that  would be
reasonably likely to  prevent the performance  in all material  respects of  any
covenant or the satisfaction of any condition contained in the Merger Agreement.
 
     In the Merger Agreement, each of the parties agrees promptly to notify each
other  party of any claims, actions, proceedings or investigations commenced or,
to the best of its knowledge, threatened, and any material developments relating
to any  such pending  claim, action,  proceeding or  investigation involving  or
affecting  the parties, or any of their  respective properties or assets, or, to
the best of its knowledge, any employee or consultant of the parties, in his  or
her capacity as such, or director or officer, in his or her capacity as such, of
SEPSCO  or Triarc disclosed in  writing pursuant to or  which, if pending on the
date, would have been required to have been disclosed in writing pursuant to the
Merger Agreement, or which relate to the consummation of the Merger.
 
     The Merger Agreement also  provides that each  party promptly shall  notify
the  others of: (i) any notice of, or other communication relating to, a default
or event that, with  notice or lapse  of time or both,  would become a  default,
received  by such party or any of its subsidiaries subsequent to the date of the
Merger Agreement and prior to the Effective Time, under any agreement, indenture
or instrument  material  to the  financial  condition, properties,  business  or
results  of operations of  such party and  its subsidiaries taken  as a whole to
which such party or any of its subsidiaries  is a party or is subject; (ii)  any
notice  or other communication from any third party alleging that the consent of
such third  party is  or may  be required  in connection  with the  transactions
contemplated  by the Merger  Agreement; (iii) any  notice or other communication
from any regulatory authority in  connection with the transactions  contemplated
by  the  Merger Agreement,  (iv) any  material adverse  change in  the financial
condition, properties, businesses or results of operations of such party and its
subsidiaries taken as a whole,  or the occurrence of an  event which, so far  as
reasonably  can be foreseen at  the time of its  occurrence, would result in any
such change; or (v) any  matter arising after the  date of the Merger  Agreement
which,  if existing,  occurring or  known at the  date of  the Merger Agreement,
would have been required to be disclosed to such other parties.
 
     In the Merger Agreement, each party  agrees that it shall, and shall  cause
its  subsidiaries, officers, directors, employees and  agents to, afford to each
other  party  and  such   party's  accountants,  counsel,  financial   advisors,
investment  bankers and  other agents  and representatives,  full access  at all
reasonable times throughout the period prior to the Effective Time to all of the
officers, employees,  agents,  properties,  books,  contracts,  commitments  and
records  (including  but not  limited  to tax  returns)  of such  party  and its
subsidiaries.
 
TERMINATION
 
     The Merger Agreement may be terminated notwithstanding the approval by  the
SEPSCO  Stockholders or the shareholders  of Triarc or Mergerco  (i) at any time
prior to the Effective  Time, by mutual  consent of the  boards of directors  of
each  of the respective parties  to the Merger Agreement,  (ii) by either Triarc
and Mergerco or SEPSCO if  the Merger is not consummated  on or before June  30,
1994  (or such  later date as  the parties may  agree to in  writing) unless the
failure to consummate  the Merger on  or prior  to such date  resulted from  the
failure of the party seeking to terminate the Merger Agreement to satisfy any of
the  closing conditions set  forth in the  Merger Agreement, (iii)  by SEPSCO if
either Triarc or Mergerco fails  to perform in any  material respect any of  its
material  obligations under the Merger Agreement,  or (iv) by Triarc or Mergerco
if SEPSCO  fails  to  perform  in  any material  respect  any  of  its  material
obligations under the Merger Agreement; provided that, in the event of a failure
to perform under clauses (iii) or (iv) above, if such failure is curable, notice
of  such failure shall have  been given to the  defaulting party and the failure
shall not have been cured  within 30 days of  such notice. The Merger  Agreement
will  automatically be  terminated, at any  time prior to  the Merger, including
following approval of the Merger by the SEPSCO Stockholders, if (i) the District
Court rejects the Settlement Agreement or  any of the material Settlement  Terms
and  Conditions or (ii) any court having  jurisdiction over the matter shall set
aside, overturn or materially modify the District
 
                                       51
 
<PAGE>
Court's Final  Order approving  the  Settlement Agreement  or such  court  shall
otherwise  take  any action  which causes  the Settlement  Agreement to  fail to
become effective according to its terms.
 
CERTAIN OTHER PROVISIONS OF THE MERGER AGREEMENT
 
     In  the  Merger   Agreement,  Triarc   has  agreed  that   all  rights   to
indemnification  existing as of the date of the Merger Agreement in favor of the
employees,  agents,  directors  or  officers  of  SEPSCO  and  its  subsidiaries
(collectively,  the  'Indemnified  Parties')  as  provided  in  their respective
charters or by-laws,  by agreement or  otherwise in  effect on the  date of  the
Merger  Agreement shall survive the Merger and shall, with respect to any action
or omission occurring prior  to the Effective Time,  continue in full force  and
effect  in  accordance with  their  terms for  a period  of  six years  from the
Effective Time; provided that, in the event any claim or claims are asserted  or
made  within such six year  period, all rights to  indemnification in respect of
any such claim or  claims shall continue  until the disposition  of any and  all
such  claims. In addition, the Merger Agreement provides that if any Indemnified
Party  becomes  involved  in   any  capacity  in   any  action,  proceeding   or
investigation   in  connection  with  any  matter,  including  the  transactions
contemplated by the  Merger Agreement,  occurring prior to,  and including,  the
Effective  Time, SEPSCO will periodically advance  to such Indemnified Party its
legal and other expenses incurred  in connection therewith. Furthermore,  Triarc
has  agreed in  the Merger  Agreement that subsequent  to the  Effective Time it
shall, jointly and severally with the Surviving Corporation, to the extent, with
respect to  each indemnitor,  permitted by  applicable law,  (i) indemnify  each
member of the SEPSCO Special Committee and their successors and assigns from and
against  any  and  all  issues, claims,  judgments  and  liabilities (including,
reasonable fees  and disbursements  of attorneys  and costs  of  investigation),
relating  to the Merger  Agreement or the  transactions contemplated thereby and
(ii) periodically advance to each member  of the SEPSCO Special Committee  legal
and  other expenses  incurred in  connection therewith;  provided, however, that
Triarc's indemnification liabilities (including its obligations to advance legal
and other  expenses) shall  not apply  either (x)  in respect  of any  liability
unless  demand for indemnification in respect of such liability is first made on
SEPSCO and SEPSCO does not promptly pay the  same or (y) to amounts paid in  any
settlement effected without Triarc's written consent (which consent shall not be
unreasonably  withheld). In any proceeding to determine whether Triarc's consent
was unreasonably withheld, Triarc will have the burden of proof of demonstrating
that its consent was reasonably withheld. Triarc has also agreed to cause to  be
maintained  in effect  for a  period of  six years  from the  Effective Time the
current policies of the directors' and officers' liability insurance  maintained
by  SEPSCO (the 'D&O  Insurance Coverage') (provided  that Triarc may substitute
therefor policies of at least the same coverage containing terms and  conditions
which  are no less advantageous) with respect  to matters occurring prior to the
Effective Time; provided, however, that Triarc's obligation to maintain such D&O
Insurance Coverage shall be subject to  SEPSCO being able to maintain or  obtain
insurance  at  an annual  cost  not greater  than  150% of  the  annual premiums
currently paid  (the annual  premiums currently  being paid  being the  'Current
Annual  Premiums') by SEPSCO with  respect to its D&O  Insurance and if such D&O
Insurance Coverage is not avilable at such cost, then Triarc has agreed to cause
to be  maintained  the highest  level  of D&O  Insurance  Coverage that  can  be
purchased against payment of annual premiums equal to 150% of the Current Annual
Premiums.
 
     The  Merger  Agreement  provides that  it  may  be amended  by  the parties
thereto, by action taken  by their respective Boards  of Directors, at any  time
prior  to  the Effective  Time; provided,  however, that  after approval  of the
Merger Agreement by SEPSCO Stockholders, no amendment or modification shall  (a)
alter  or change the amount or kind of shares, securities, cash, property and/or
rights to be  received in exchange  for or on  conversion of all  or any of  the
shares of any class or series thereof of SEPSCO, (b) alter or change any term of
the  certificate of incorporation of the Surviving Corporation to be effected by
the Merger, (c) alter or  change any of the terms  and conditions of the  Merger
Agreement if such alteration or change would adversely affect the holders of any
class  or series of capital stock of SEPSCO or (d) amend the Merger Agreement to
permit the waiver by  the parties of the  Settlement Condition. In addition,  at
any  time prior to  the Effective Time,  the parties to  the Merger Agreement by
action taken by their respective Boards of Directors may (a) extend the time for
the performance of any of the obligations or other acts of the other parties  to
the  Merger Agreement,  (b) waive  any inaccuracies  in the  representations and
warranties contained in the Merger Agreement or
 
                                       52
 
<PAGE>
in any document delivered pursuant hereto, and (c) waive compliance with any  of
the  agreements  or  conditions  contained in  the  Merger  Agreement; provided,
however, that the parties may not waive satisfaction of the Settlement Condition
and provided, further,  that any  action taken by  the SEPSCO  Board to  enforce
SEPSCO's  rights under  the Merger Agreement,  including the right  to amend the
Merger Agreement or to permit  any such waiver, or to  consent to the taking  of
any  action which may not  be taken without SEPSCO's  consent, may only be taken
following the authorization thereof by the Special Committee.
 
     The Merger Agreement also provides that  (i) subject to applicable law  and
fiduciary  duties, including  the duties of  loyalty and care,  the SEPSCO Board
shall recommend that  the SEPSCO Stockholders  vote in favor  of the Merger  and
adoption  of the Merger Agreement, (ii) all  SEPSCO Voting Stock owned by Triarc
or any subsidiary of  Triarc will be  voted in favor of  adoption of the  Merger
Agreement.
 
                      FINANCING OF THE MERGER AND RELATED
                    TRANSACTIONS: SOURCE AND AMOUNT OF FUNDS
 
     The  approximate fees  and expenses expected  to be incurred  by Triarc and
SEPSCO in connection with the Merger are as set forth below:
 

<TABLE>
<CAPTION>
                                                                                 TRIARC        SEPSCO
                                                                               ----------    ----------
<S>                                                                            <C>           <C>
Investment Bankers' Fees and Expenses.......................................   $   --        $  470,000
Attorneys' Fees and Expenses................................................      850,000       230,000
Accountants' Fees and Expenses..............................................      350,000        --
Exchange Agent's Fees and Expenses..........................................       20,000        10,000
Printing Costs..............................................................      320,000       220,000
Solicitation Expenses (Including Proxy Solicitation Firm's Fees and
  Expenses).................................................................       21,000         1,000
Fee for Filing with the SEC.................................................        1,800        16,185
Blue Sky Fees and Expenses..................................................        5,000        --
Miscellaneous...............................................................      132,200        52,815
                                                                               ----------    ----------
          Total.............................................................   $1,700,000    $1,000,000
                                                                               ----------    ----------
                                                                               ----------    ----------
</TABLE>

 
     Pursuant to the Settlement Agreement, if the Merger is consummated,  Triarc
will  pay $1,250,000 in respect of fees  and expenses of Plaintiff's counsel and
$50,000 in respect of fees and  expenses of Plaintiff's investment banker.  Such
attorneys' fees and expenses are to be paid upon the later of (i) the closing of
the  Merger, and (ii) the Settlement  Agreement becoming effective. See 'SPECIAL
FACTORS -- Legal Proceedings Related to Triarc and SEPSCO.'
 
     Out-of-pocket  costs  and  expenses  incurred  by  Triarc  and  SEPSCO   in
connection  with the Merger will  be paid by the  party incurring such costs and
expenses. Expenses incurred by SEPSCO and  Triarc in connection with the  Merger
and the Settlement Agreement are expected to be paid out of available funds.
 
                                       53

<PAGE>
             CERTAIN FEDERAL INCOME TAX CONSEQUENCES OF THE MERGER
 
     The  discussion below is intended only as a summary and does not purport to
be a complete analysis  or listing of  all potential tax  effects relevant to  a
decision  whether  to vote  for the  approval  of the  Merger Agreement  and the
Merger. The  discussion  addresses neither  the  tax consequences  that  may  be
relevant  to  particular categories  of investors  subject to  special treatment
under certain federal  income tax laws,  such as dealers  in securities,  banks,
insurance   companies  and  foreign   individuals  or  entities,   nor  any  tax
consequences arising  out  of  the  laws  of  any  state,  locality  or  foreign
jurisdiction.  Furthermore, the  tax consequences  to taxpayers  who acquired an
interest in SEPSCO as  compensation may differ from  those discussed herein  and
such other tax consequences are not addressed herein.
 
     The  exchange of shares of SEPSCO Common Stock for shares of Triarc Class A
Common Stock will constitute a taxable exchange for federal income tax purposes.
As a result, a holder of SEPSCO Common Stock will recognize gain or loss on  the
exchange  of  SEPSCO Common  Stock for  shares  of Triarc  Class A  Common Stock
measured by the difference between such  stockholder's tax basis in such  shares
of SEPSCO Common Stock and the fair market value of the shares of Triarc Class A
Common  Stock received with respect  thereto. Such gain or  loss will be capital
gain or loss provided that such shares  of SEPSCO Common Stock were held by  the
stockholder  as a capital  asset, and will be  long-term if, at  the time of the
exchange, the shares have been held for  more than one year. Gain, loss and  tax
basis,  must  be calculated  separately for  each block  of SEPSCO  Common Stock
(i.e., a group of shares acquired at the same time as single transaction at  the
same  cost) held by  a stockholder. A  stockholder's tax basis  in the shares of
Triarc Class A  Common Stock will  be equal to  the fair market  value of  those
shares  at the time of  the exchange and the holding  period of such shares will
begin on the date they are received.
 
     Under the Internal Revenue Code, interest, dividends and other  'reportable
payments'  may, under certain circumstances,  be subject to 'backup withholding'
at a rate of 31%. Backup  withholding generally applies if the stockholder:  (a)
fails  to  furnish  such  holder's  social  security  number  or  other taxpayer
identification number  ('TIN');  (b)  furnishes  an  incorrect  TIN;  (c)  fails
properly  to report interest  or dividends; or  (d) under certain circumstances,
fails to provide a  certified statement, signed under  penalty or perjury,  that
the  TIN  provided  is  correct  and  such  holder  is  not  subject  to  backup
withholding. The  backup  withholding  tax  is not  an  additional  tax  and  is
creditable against the holder's federal income tax liability.
 
     SEPSCO  stockholders are urged to consult their own tax advisors concerning
the federal, state, local and foreign tax consequences to each such  stockholder
of  the  Merger  with  specific  reference to  their  own  particular  facts and
circumstances on the matters discussed herein.
 
             COMPARISON OF RIGHTS OF HOLDERS OF SEPSCO COMMON STOCK
                        AND TRIARC CLASS A COMMON STOCK
 
INTRODUCTION
 
     Triarc is incorporated under the laws of  the State of Ohio, and SEPSCO  is
incorporated  under the laws of the  State of Delaware. The SEPSCO Stockholders,
whose rights as stockholders are currently governed by Delaware law and SEPSCO's
Composite Certificate of Incorporation, as  amended (the 'SEPSCO Certificate  of
Incorporation')  and By-Laws (the 'SEPSCO By-Laws'),  will, upon the exchange of
their shares for shares of Triarc Class  A Common Stock pursuant to the  Merger,
become shareholders of Triarc, and their rights as such will be governed by Ohio
law,  Triarc's  Amended  Articles  of  Incorporation,  as  amended  (the 'Triarc
Articles') and Triarc's Code of Regulations (the 'Triarc Regulations').  Certain
differences  between the rights  of holders of  Triarc Class A  Common Stock and
SEPSCO's Common  Stock resulting  from  such differences  in governing  law  and
documents are summarized below.
 
     The  following summary does not  purport to be a  complete statement of the
rights of Triarc's shareholders under applicable Ohio laws, the Triarc  Articles
and  the Triarc Regulations as compared with the rights of SEPSCO's stockholders
under applicable Delaware laws, the SEPSCO Certificate of Incorporation and  the
SEPSCO  By-Laws or a complete description of the specific provisions referred to
herein. The identification of specific differences is not meant to indicate that
other equally or more
 
                                       54
 
<PAGE>
significant differences do not exist. This summary is qualified in its  entirety
by  reference  to the  DGCL and  the Ohio  General Corporation  Law (as  well as
Chapters 1704 and  1707 of the  Ohio Revised Code)  and the governing  corporate
instruments  of Triarc  and SEPSCO,  to which  the holders  of shares  of SEPSCO
Common Stock are referred.
 
     Certain provisions  contained  in  the Ohio  laws  may  discourage  certain
transactions  involving an actual or threatened  change in control of Triarc. To
the extent any  of such  provisions has such  an effect,  shareholders might  be
deprived of an opportunity to sell their shares of Triarc at a premium above the
market price.
 

     Triarc's management currently intends to recommend to the Triarc Board that
Triarc reincorporate in Delaware (the 'Reincorporation'). If the Reincorporation
is  approved  by  the Triarc  Board,  Triarc's management  anticipates  that the
Reincorporation would  be presented  to Triarc's  shareholders for  approval  at
Triarc's 1994 Annual Meeting of Shareholders, which is currently scheduled to be
held in June 1994. If the Merger Agreement is adopted at the Special Meeting and
the Merger consummated shortly thereafter, as currently contemplated, the SEPSCO
Stockholders  will  become  Triarc shareholders  prior  to the  record  date for
determining shareholders entitled to vote  at Triarc's 1994 Annual Meeting  and,
as  such, will be entitled to vote at  such meeting on whether or not to approve
such  Reincorporation.  If   both  the  Merger   and  the  Reincorporation   are
consummated,  the  rights  of  former SEPSCO  Stockholders,  as  shareholders of
Triarc, will be governed by Delaware law. There can be no assurance, however, of
the timing of the Reincorporation or if it will be consummated.

 
CERTAIN VOTING RIGHTS
 
     Delaware law generally  requires approval of  any merger, consolidation  or
sale  of  substantially  all  the  assets  of  a  corporation  at  a  meeting of
stockholders by vote of the holders of  a majority of all outstanding shares  of
the  corporation entitled to vote thereon.  While a certificate of incorporation
of a Delaware corporation may provide for a greater vote, the SEPSCO Certificate
of Incorporation does not so provide.
 
     Under Ohio law, unless otherwise provided in the corporation's articles  of
incorporation,  such  matters  require the  approval  of the  holders  of shares
entitling such holders to  exercise at least two-thirds  of the voting power  of
the  corporation.  The  articles of  incorporation  of an  Ohio  corporation may
provide for a greater or lesser vote or  a vote by separate classes of stock  so
long as the vote provided for is not less than a majority of the voting power of
the  corporation. The Triarc Articles do not contain any provisions changing the
requirement for the approval of such matters by the holders of shares  entitling
such  holders  to  exercise at  least  two-thirds  of the  voting  power  of the
corporation.
 
     If a proposed amendment to the  certificate of incorporation of a  Delaware
corporation  affects adversely the  rights, preferences or powers  of a class of
stock without voting rights  in certain specified  matters, such amendment  must
also  be approved by  a majority of the  holders of that  class of stock. Unless
otherwise provided by an Ohio corporation's articles of incorporation, the  Ohio
General  Corporation law would require that,  among certain other amendments, an
amendment that  would change  the express  terms of  a class  of shares  without
voting rights in any substantially prejudicial manner be approved by the holders
of two-thirds of such class.
 
     The  Triarc Articles generally  provide that (i) the  consent of holders of
two-thirds of the outstanding shares of Redeemable Convertible Preferred  Stock,
voting  as a  class, is  required to  approve certain  amendments to  the Triarc
Articles or Triarc  Regulations that would  adversely affect the  rights of  the
holders  of the Redeemable Convertible Preferred Stock and that (ii) the consent
of the  holders of  a majority  of  the outstanding  shares of  Triarc's  Serial
Preferred Stock, par value $.10 per share (the 'Triarc Serial Preferred Stock'),
and  Triarc's  Junior Serial  Preferred  Stock, par  value  $.10 per  share (the
'Triarc Junior Serial Preferred Stock'), each voting as a class, is required  to
approve amendments to the Triarc Articles or Triarc Regulations that could cause
substantial prejudice to the holders of the Triarc Serial Preferred Stock or the
Triarc Junior Serial Preferred Stock. As of the date hereof, no shares of Triarc
Serial Preferred Stock or Triarc Junior Serial Preferred Stock are outstanding.
 
     Both  Ohio  law  and  Delaware  law  permit  mergers  without  approval  by
shareholders of the  surviving corporation  if, among other  things, no  charter
amendment is involved and issuances of common stock
 
                                       55
 
<PAGE>
and   securities  convertible   into  common   stock  to   shareholders  of  the
non-surviving corporation pursuant to the merger  will result in no more than  a
specified  maximum increase in outstanding common stock. Under Delaware law, the
maximum permitted increase is 20% of the corporation's common stock  outstanding
immediately  prior to the merger. Under Ohio law, the maximum permitted increase
is any amount less than 16  2/3% of a corporation's resulting shares  possessing
the voting power of that corporation in the election of directors.
 
     The  rules of the NYSE, on which the Triarc Class A Common Stock is listed,
require Triarc  shareholder approval  prior to  the issuance  by Triarc  of  any
Triarc  Common Shares, or any securities  convertible into Triarc Common Shares,
if such shares are to be issued in connection with any transaction or series  of
related  transactions, other than a public offering  for cash, if (i) the voting
power of such Triarc Common Shares would be equal to at least 20% of the  voting
power  of the shares outstanding  prior to the issuance  of such shares, or (ii)
the number of such shares would be equal to at least 20% of the number of Triarc
Common Shares outstanding prior to the  issuance of such shares. The NYSE  rules
also  require  shareholder approval  for  certain transactions  in  which Triarc
Common Shares, or securities  convertible into Triarc Common  Shares, are to  be
issued  to a Triarc director, officer,  substantial shareholder, or an entity in
which any such  person holds  a substantial interest,  if the  number of  Triarc
Common  Shares so issued or into which  the securities so issued are convertible
exceeds one percent of the number  of Triarc Common Shares outstanding prior  to
such  issuance or  one percent  of the  outstanding voting  power prior  to such
issuance. The  NYSE  also requires  shareholder  approval for  any  issuance  of
securities by Triarc that will result in a change of control of Triarc.
 
SPECIAL MEETINGS OF SHAREHOLDERS; SHAREHOLDER ACTION BY WRITTEN CONSENT
 
     Under Delaware law, special stockholder meetings may be called by the Board
of  Directors and  by any  person or  persons authorized  by the  certificate of
incorporation or  the by-laws.  Under the  SEPSCO By-Laws,  special meetings  of
SEPSCO  stockholders may be called at any time by the president or the secretary
or by a majority of the directors or by resolution of the SEPSCO Board.
 
     Under Ohio law, a special meeting of the shareholders may be called by  the
chairman  of the board of directors, the  president, a majority of the directors
acting without a meeting, persons owning 25% of the outstanding shares  entitled
to  vote at such meeting (or a lesser  or greater proportion as specified in the
articles or  regulations but  not greater  than 50%)  or the  person or  persons
authorized  to  do so  by  the articles  of  incorporation or  the corporation's
regulations. The Triarc Regulations do  not authorize any additional persons  to
call  a meeting. The Triarc Regulations further provide that business transacted
at any special meeting of shareholders  shall be confined to the purpose  stated
in the notice for such special meeting.
 
     Under  Delaware law, any action by stockholders  must be taken at a meeting
of stockholders, unless a consent in  writing setting forth the action so  taken
is  signed by the stockholders having not  less than the minimum number of votes
necessary to take such action at a meeting at which all shares entitled to  vote
were present and voted.
 
     Under  Ohio law, any  action by shareholders  generally must be  taken at a
meeting of shareholders, unless a consent in writing setting forth the action so
taken is signed by all the shareholders  who would be entitled to notice of  the
meeting held to consider the subject matter thereof.
 
AMENDMENT OF CERTIFICATE OF INCORPORATION AND BY-LAWS
 
     Delaware  law allows amendments of the  certificate of incorporation if the
board of directors adopts a resolution setting forth the amendment proposed  and
declaring  its  advisability,  and  the  stockholders  thereafter  approve  such
proposed amendment  either at  a special  meeting called  by the  board for  the
purpose  of approval of such amendment by the stockholders or, if so directed by
the board, at the  next annual stockholders' meeting.  At any such meeting,  the
proposed  amendment generally must be approved  by a majority of the outstanding
shares entitled to vote.
 
     Ohio  law  permits  the   adoption  of  amendments   to  the  articles   of
incorporation if such amendments are approved at a meeting held for such purpose
by    the    holders   of    shares    entitling   them    to    exercise   two-
 
                                       56
 
<PAGE>
thirds of the voting power of the corporation, or such lesser, but not less than
a majority,  or greater  vote  as specified  in  the corporation's  articles  of
incorporation. The Triarc Articles do not alter this provision.
 
     Under  Delaware law,  the power to  adopt, amend or  repeal by-laws resides
with the stockholders entitled to vote  thereon, and with the directors if  such
power   is  conferred  upon  the  board  of  directors  by  the  certificate  of
incorporation. The SEPSCO Certificate of Incorporation so provides.
 
     Under Ohio law,  regulations may be  adopted, amended or  repealed only  by
approval  of the shareholders.  They may be  adopted or amended  at a meeting of
shareholders by the affirmative vote of the holders of shares entitling them  to
exercise  a majority of the voting power  on such proposal or by written consent
signed by holders of shares entitling them to exercise two-thirds of the  voting
power on such proposed amendment.
 
BOARD APPROVED PREFERRED STOCK
 
     Both  Delaware  law  and Ohio  law  permit a  corporation's  certificate of
incorporation or articles of incorporation, respectively, to allow the board  of
directors  to  issue, without  shareholder approval,  a  series of  preferred or
preference stock and to designate the powers, rights, preferences and privileges
thereof and restrictions thereon (except that Ohio law does not permit the board
of directors  to fix  the  voting rights  of any  such  series of  preferred  or
preference  stock). The SEPSCO Certificate of Incorporation grants such power to
the SEPSCO Board. Similarly, the Triarc Articles grant such power to the  Triarc
Board  with respect to the  Triarc Serial Preferred Stock  and the Triarc Junior
Serial Preferred Stock.
 
LIABILITY AND INDEMNIFICATION OF OFFICERS AND DIRECTORS
 
     Delaware law  and  Ohio  law  have  provisions  and  limitations  regarding
directors'  liability  and indemnification  by  a corporation  of  its officers,
directors and employees.
 
     A director of an Ohio corporation shall  not be found to have violated  his
fiduciary duties to the corporation or its shareholders unless there is proof by
clear  and convincing evidence that the director has not acted in good faith, in
a manner he reasonably believes to be in or not opposed to the best interests of
the corporation, or with the  care that an ordinarily  prudent person in a  like
position  would use under  similar circumstances. In addition,  under Ohio law a
director is liable in  damages for any  action or failure to  act as a  director
only  if it is proved by clear and convincing evidence that such act or omission
was undertaken either with deliberate intent to cause injury to the  corporation
or with reckless disregard for the best interests of the corporation, unless the
corporation's  articles  or  regulations  make  this  provision  inapplicable by
specific reference. The Triarc Articles do not make this provision inapplicable.
 
     Ohio law does  not, however,  require proof of  intent to  cause injury  or
reckless  disregard as a condition to  the availability of injunctions, recovery
on principles of restitution or other  relief which is essentially equitable  in
nature. The Ohio law limits a director's liability for breaches of the fiduciary
duties  of care and  loyalty. This standard  does not apply,  however, where the
director has acted either outside his capacity as a director or with respect  to
certain  dividends,  distributions,  purchases  or  redemptions  of  corporation
shares, loans or,  in the  case of  a corporation  that does  not have  actively
traded  shares, a  change in  control in  which a  majority of  the shareholders
receive a greater consideration for  their shares than other shareholders.  Ohio
law  further requires  all expenses,  including attorney's  fees, incurred  by a
director in defending any action, suit  or proceeding (other than one  asserting
only  liability for unlawful  dividends, distributions or  redemptions) shall be
paid by the corporation as they are incurred in advance of the final disposition
of the action, suit or proceeding upon receipt of an undertaking by or on behalf
of the director  in which he  agrees to repay  such amounts if  it is proved  by
clear  and convincing evidence that his action or failure to act involved an act
or omission undertaken with deliberate intent to cause injury to the corporation
or undertaken with reckless disregard for the best interests of the  corporation
and  the  director reasonably  cooperates  with the  corporation  concerning the
action, suit or proceeding. These provisions are automatically applicable to  an
Ohio  corporation unless the corporation opts out from their application. Triarc
has not opted out.
 
                                       57
 
<PAGE>
     Delaware law permits a Delaware  corporation to include in its  certificate
of  incorporation a provision which eliminates  or limits the personal liability
of a director to  the corporation or its  stockholders for monetary damages  for
breach  of  fiduciary  duties  as  a director  provided  no  such  provision may
eliminate or  limit the  liability  of a  director (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, (iii)  under Section 174  of the  DGCL (dealing  with
illegal  redemptions and  stock repurchases)  or (iv)  for any  transaction from
which the director derived an improper personal benefit. The SEPSCO  Certificate
of Incorporation does not include such a provision.
 
     The  SEPSCO By-laws require SEPSCO to indemnify  any person who is or was a
party or  is  threatened to  be  made a  party  to any  threatened,  pending  or
completed  action, suit or proceeding by reason of  the fact that he is or was a
director, officer, employee  or agent of  SEPSCO, or  is or was  serving at  the
request  of  SEPSCO  as  a  director,  officer,  employee  or  agent  of another
enterprise, against expenses  (including attorneys'  fees) and,  if the  action,
suit  or proceeding is one which  is other than by or  in the right of SEPSCO to
procure a  judgment in  its favor,  against judgments,  fines, amounts  paid  in
settlement,  actually and reasonably incurred by  such person in connection with
any such action, suit or proceeding to the fullest extent permitted by the DGCL.
Under the DGCL, a  director or officer  may, in general,  be indemnified by  the
corporation if he has acted in good faith and in a manner he reasonably believed
to  be in  or not  opposed to the  best interests  of the  corporation and, with
respect to any criminal action or proceeding, had no reasonable cause to believe
his conduct was unlawful.
 
CLASSIFICATION OF BOARD OF DIRECTORS
 
     Both Delaware law and Ohio law permit, but do not require, the adoption  of
a 'classified' board of directors with staggered terms under which a part of the
board  of directors  is elected  each year  for a  maximum term  of three years.
Neither SEPSCO nor Triarc has a classified board of directors and all  directors
stand for election on an annual basis.
 
CUMULATIVE VOTING OF SHARES
 
     Under Delaware law, shareholders of a corporation cannot elect directors by
cumulative  voting  unless its  certificate  of incorporation  so  provides. The
SEPSCO Certificate of Incorporation does not provide for cumulative voting. As a
result, the holder or holders  of a majority of the  voting power of SEPSCO  are
able to elect all directors then being elected.
 
     In  accordance with  Ohio law, cumulative  voting (unless  eliminated by an
amendment of the articles of incorporation) is required to be available for  the
election  of directors if notice to such  effect is given by a shareholder prior
to a shareholders' meeting and  an announcement to such  effect is made at  such
meeting. The Triarc Articles have been amended to provide for the elimination of
such cumulative voting rights.
 
NUMBER OF DIRECTORS
 
     Under  Delaware law, unless the  certificate of incorporation specifies the
number of directors, a  board of directors may  change the authorized number  of
directors  by an amendment to the corporation's  by-laws if fixed therein, or in
such manner as provided therein.  If the certificate of incorporation  specifies
the number of directors, the number of directors can only be changed by amending
the  certificate  of  incorporation.  The  SEPSCO  Certificate  of Incorporation
provides that  the number  of directors  of SEPSCO  shall be  fixed and  may  be
altered  from time to time as provided in the SEPSCO By-Laws. The SEPSCO By-Laws
provides that the number of directors shall be five.
 
     Under Ohio law, the number  of directors of a  corporation may be fixed  or
changed by the shareholders or by the board of directors if so authorized by the
corporation's  articles of incorporation or  regulations. The Triarc Regulations
provide that the number of directors  which shall constitute the whole board  of
directors  shall be limited to a maximum of thirteen persons unless changed by a
vote of  the holders  of a  majority of  shares entitled  to vote  thereon at  a
meeting of shareholders called for the purpose of electing directors.
 
                                       58
 
<PAGE>
REMOVAL OF DIRECTORS
 
     In  general,  under both  Delaware  law and  Ohio law,  any  or all  of the
directors of a corporation may be removed, with or without cause, by vote of the
holders of a  majority of the  shares then entitled  to vote at  an election  of
directors,  except that Delaware law authorizes removal by the shareholders of a
member of a classified board only for cause.
 
DISSENTERS' RIGHTS IN MERGERS
 
     Under both  Delaware law  and  Ohio law,  a  shareholder of  a  corporation
participating  in certain merger transactions  may, under certain circumstances,
receive cash in the amount of the fair market value of his shares (as determined
by a court)  in lieu  of the  consideration he  would otherwise  receive in  the
merger.  Unless a corporation's certificate of incorporation provides otherwise,
Delaware law  does not  require that  such dissenters'  rights of  appraisal  be
afforded  to stockholders  with respect  to (i) a  merger or  consolidation of a
corporation with a surviving corporation the  shares of which are either  listed
on a national securities exchange designated as a national market security or an
interdealer  quotation system by the National Association of Securities Dealers,
Inc. or widely held  (by more than 2,000  shareholders), if the stockholders  of
such  corporation receive only shares of the  surviving corporation or of such a
listed or  widely held  corporation;  or (ii)  those  stockholders who  are  the
stockholders  of a corporation surviving a merger if no vote of such stockholder
is required because, among other  things, the number of  shares to be issued  in
the  merger  does not  exceed 20%  of  the shares  of the  surviving corporation
outstanding immediately prior  to the  merger (if certain  other conditions  are
met).
 
     Ohio  law does  not provide exclusions  from dissenters'  rights similar to
those described above with respect to Delaware law. However, under Ohio law,  in
mergers  and certain  other transactions (e.g.,  acquisitions of assets  or of a
majority of stock interests in exchange for stock) in which, after giving effect
to the  transaction,  the original  shareholders  of the  acquiring  corporation
retain  more  than five-sixths  of the  voting power  of such  corporation, such
shareholders are denied dissenters' rights.
 
PAYMENT OF DIVIDENDS
 
     Both Delaware  law and  Ohio law  permit the  payment of  dividends out  of
paid-in, earned or other surplus. However, under Ohio law, if a dividend is paid
out of capital surplus, shareholders must be so notified. Under Delaware law, no
such  notice is required and  dividends may also be paid  out of net profits for
the fiscal year in which declared or out of net profits for the preceding fiscal
year, even if the corporation has no surplus.
 
REPURCHASE OF SHARES
 
     Under Ohio law, a corporation by act of its directors may repurchase shares
only in certain specified instances, the most significant of which are when  the
articles authorize the redemption of such shares, when the articles in substance
provide  that  the corporation  shall  have the  right  to repurchase,  and when
authorized by  the shareholders  at a  meeting called  for such  purpose by  the
affirmative vote of the holders of two-thirds of the shares of each class or, if
the  articles so provide, by a greater or  lesser proportion but not less than a
majority. The Triarc  Articles authorize  the directors  to use  surplus or  net
profits in excess of $250,000 to repurchase shares of Triarc common stock.
 
     Delaware  law vests discretion  in the board of  directors to authorize the
repurchase of shares.
 
     Both Delaware and Ohio law permit the redemption of shares out of  paid-in,
earned or other surplus.
 
LOANS TO DIRECTORS AND OFFICERS
 
     Under  Delaware  law,  a  corporation  may  make  loans  to,  guarantee the
obligations of or otherwise assist its officers or other employees and those  of
its  subsidiaries when  the transaction,  in the  judgment of  the corporation's
board of directors, may reasonably be expected to benefit the corporation. Under
Ohio law,  a  corporation generally  may  make a  loan  to or  guaranty  of  the
obligations of officers, directors or shareholders only if such loan or guaranty
is  approved  by  a  majority  of the  disinterested  members  of  its  board of
directors. The  disinterested  directors,  taking into  account  the  terms  and
provisions  of  the loan  and other  relevant factors,  must determine  that the
making of the  loan could  reasonably be  expected to  benefit the  corporation.
Under Ohio law, directors who authorize unlawful loans are jointly and severally
liable  for  the loan  together  with interest.  The  standard of  conduct which
 
                                       59
 
<PAGE>
is a  precondition  to  the  imposition  of  monetary  damages  discussed  under
'  --  Liability and  Indemnification of  Officers and  Directors' above  is not
applicable to directors' authorizing unlawful loans.
 
TENDER OFFER STATUTE
 
     The Ohio tender offer statute requires any person making a tender offer for
a corporation incorporated in Ohio to comply with certain filing, disclosure and
procedural requirements. Delaware has no tender offer statute.
 
     The Ohio  tender  offer  statute  imposes  certain  filing  and  disclosure
requirements.  The disclosure requirements  include a statement  of any plans or
proposals that the  offeror, upon  gaining control,  may have  to liquidate  the
subject  company,  sell its  assets,  effect a  merger  or consolidation  of it,
establish, terminate, convert, or amend employee benefit plans, close any  plant
or  facility of the subject company or of any of its subsidiaries or affiliates,
change or  reduce  the  work  force  of  the  subject  company  or  any  of  its
subsidiaries  or affiliates,  or make  any other  major change  in its business,
corporate structure, management personnel, or policies of employment.
 
     Until the  issue of  constitutionality is  decided by  clearly  controlling
appellate   court   decisions  or   clarifying   legislation  is   adopted,  the
enforceability of  the  Ohio  statute  as  a  protection  against  board-opposed
takeover attempts is uncertain.
 
     In  addition, Ohio has a 'Control Share Acquisition' statute which requires
shareholder approval for the acquisition of  voting power for certain ranges  of
stock  ownership.  This statute  was declared  unconstitutional  in 1986  by the
United States  District  Court  for  the Southern  District  of  Ohio  in  Fleet
Aerospace  Corp. v. Holderman,  which holding was affirmed  by the United States
Court of Appeals for the Sixth Circuit.  On April 27, 1987, however, the  United
States  Supreme Court vacated and remanded the Sixth Circuit's decision in light
of the Supreme Court's recent holding in CTS Corporation v. Dynamics Corporation
of America,  which held  that Indiana's  Control Share  Acquisition Act,  a  law
similar  in  some  respects  to  the  Ohio  Control  Share  Acquisition  Act, is
constitutional.
 
MERGER MORATORIUM STATUTES
 
     Both Ohio and Delaware have 'Merger Moratorium' statutes which are designed
to encourage potential acquirors of publicly traded corporations such as  Triarc
and  SEPSCO to obtain the consent and approval of the proposed target's board of
directors prior to commencing  a tender offer for  the target company's  shares.
This  encouragement is accomplished by prohibiting or restricting acquirors from
undertaking many post-acquisition financial restructuring alternatives.
 
     Both the Ohio and Delaware statutes permit a corporation to opt out of  the
operation  of the  merger moratorium provisions.  Neither Triarc  nor SEPSCO has
opted out.
 
     The Ohio law becomes applicable when a person (a potential acquiror and all
of that acquiror's affiliates) can vote or direct the vote of 10% or more of the
voting shares. In Delaware,  the law is applicable  when a person acquires  more
than 15% of the voting stock.
 
     Under Ohio law (with minor exceptions), there is an absolute prohibition on
mergers and dissolutions and restrictions on asset sales and purchases and other
transactions  that would  give the acquiror  significant funds or  assets of the
target during the three-year  period after the acquiror  becomes a greater  than
10%  shareholder. Following  the three-year  period, in  Ohio, the  acquiror can
engage in these transactions only if a  fair price as defined in the statute  is
provided to the minority shareholders or the acquiror obtains the consent of the
shareholders holding a majority of the disinterested shares.
 
     In  Delaware, the restriction lasts for three years. During that three-year
period, the restrictions are not applicable  if at the time the acquiror  became
subject  to the statute it holds more than  85% of such stock or the transaction
is approved by two-thirds of the disinterested stockholders.
 
ANTI-GREENMAIL STATUTE
 
     'Greenmail' is the practice whereby a corporation purchases the shares of a
substantial minority  shareholder at  a premium  to avoid  the future  potential
takeover  of the corporation by that minority shareholder. Ohio recently enacted
an anti-greenmail  statute  which would  cause  the forfeiture  of  the  premium
received  by the minority shareholder. Ohio law permits a corporation to opt out
of the anti-greenmail statute. Triarc has so opted out.
 
                                       60

<PAGE>
                       MARKET FOR TRIARC'S COMMON EQUITY
                        AND RELATED SHAREHOLDER MATTERS
 
     Since November 17, 1993, the principal market for the Triarc Class A Common
Stock  has been the NYSE (symbol: TRY). Prior  to November 17, 1993, the date on
which the Triarc Class A Common Stock began trading on the NYSE, the ASE was the
principal market for the Triarc Class A Common Stock. The Triarc Class A  Common
Stock  is also listed on the PSE. The  high and low market prices for the Triarc
Class A  Common Stock,  as reported  in the  consolidated transaction  reporting
system, are set forth below:
 
<TABLE>
<CAPTION>
                                                                                                MARKET PRICE
                                                                                       ------------------------------
                                                                                           HIGH              LOW
                                                                                       ------------      ------------
<S>                                                                                    <C>               <C>
Fiscal 1992
     First Quarter ended July 31, 1991..............................................   $      3 5/8      $      1 3/4
     Second Quarter ended October 31, 1991..........................................          3 1/2             1 1/2
     Third Quarter ended January 31, 1992...........................................          4 7/8             2 3/4
     Fourth Quarter ended April 30, 1992............................................          9 1/2             4
Fiscal 1993
     First Quarter ended July 31, 1992..............................................   $     10 1/4      $      8
     Second Quarter ended October 31, 1992..........................................         12 1/8             9
     Third Quarter ended January 31, 1993...........................................         15 3/4            11 1/4
     Fourth Quarter ended April 30, 1993............................................         21 7/8            14 1/2
Transition 1993
     May 1, 1993 through July 31, 1993..............................................   $     22 3/4      $     16 1/8
     August 1, 1993 through October 31, 1993........................................         33                21 3/4
     November 1, 1993 through December 31, 1993.....................................         31                23 3/4
1994
     First Quarter (through March 10, 1994).........................................   $                 $
</TABLE>
 
     Other  than regular quarterly cash  dividends on its previously outstanding
preferred stock, Triarc has not paid any  dividends on its capital stock in  the
two  most recently completed fiscal years, in  Transition 1993 or in the current
year to date and does not presently anticipate the declaration of cash dividends
on its common stock in the near future.
 
     In  connection  with  the  Reorganization,  Triarc  issued  to  the  Posner
Entities,  5,982,866 shares of Redeemable  Convertible Preferred Stock having an
aggregate stated value of $71.8 million and a cumulative annual dividend rate of
8 1/8%. Such shares of  Redeemable Convertible Preferred Shares are  convertible
into  4,985,000 shares of non-voting Triarc Class B Common Stock at a conversion
price of $14.40 per share. Such shares of Redeemable Convertible Preferred Stock
can also be converted without restriction  into shares of Triarc Class A  Common
Stock  if they are sold to a  third party unaffiliated with the Posner Entities.
No dividend, other than a stock dividend payable in common stock, may be paid on
the Triarc  Class A  Common Stock  if Triarc  is in  arrears on  the payment  of
dividends  on the Redeemable Convertible Preferred Stock. Triarc has no class of
equity securities currently issued and outstanding, except for the Triarc  Class
A Common Stock and the Redeemable Convertible Preferred Stock.
 
     Because  Triarc  is  a holding  company,  holders  of its  debt  and equity
securities, including holders of the Triarc Class A Common Stock, are  dependent
primarily  upon  the  cash  flow  from  Triarc's  subsidiaries  for  payment  of
principal, interest and  dividends. Potential dividends  and other advances  and
transfers  from Triarc's subsidiaries represent  its most significant sources of
cash flow. Applicable state laws and  the provisions of the debt instruments  by
which  Triarc's  principal  subsidiaries are  bound  limit the  ability  of such
companies to  dividend  or  otherwise  provide funds  to  Triarc.  The  relevant
restrictions  of such debt instruments  are described under 'TRIARC MANAGEMENT'S
DISCUSSION AND  ANALYSIS OF  FINANCIAL CONDITION  AND RESULTS  OF OPERATIONS  --
Liquidity  and Capital Resources'  and in Note  11 of the  Notes to Consolidated
Financial Statements of Triarc Companies, Inc. and Subsidiaries.
 
                                       61
 
<PAGE>
     As of March 7,  1994, there were approximately  4,000 holders of record  of
the Triarc Class A Common Stock.
 
                       MARKET FOR SEPSCO'S COMMON EQUITY
                        AND RELATED STOCKHOLDER MATTERS
 
     The  principal market for the SEPSCO Common Stock is the PSE (symbol: SPV).
The high and low closing  prices of the SEPSCO Common  Stock as reported in  the
consolidated transaction reporting system are as follows:
 

<TABLE>
<CAPTION>
                                                                                               MARKET PRICES
                                                                                       ------------------------------
                                                                                           HIGH              LOW
                                                                                       ------------      ------------
<S>                                                                                    <C>               <C>
1991
     First Quarter ended May 31, 1990...............................................   $     11 3/8      $      8 3/4
     Second Quarter ended August 31, 1990...........................................         10 7/8             5 1/4
     Third Quarter ended November 30, 1990..........................................          7 5/8             2 5/8
     Fourth Quarter ended February 28, 1991.........................................          3 3/8             1 7/8
1992
     First Quarter ended May 31, 1991...............................................   $      2 3/4      $      2
     Second Quarter ended August 31, 1991...........................................          2                 1 1/8
     Third Quarter ended November 30, 1991..........................................          2 1/4               13/16
     Fourth Quarter ended February 29, 1992.........................................          7                 1
1993
     First Quarter ended May 31, 1992...............................................   $      7 3/8      $      4 5/8
     Second Quarter ended August 31, 1992...........................................          7                 5 1/2
     Third Quarter ended November 30, 1992..........................................         13 3/8             6 1/2
     Fourth Quarter ended February 28, 1993.........................................         14 1/2            12
SEPSCO Transition 1993
     March 1 1993 through May 31, 1993..............................................   $     16 1/2      $     13 1/4
     June 1, 1993 through August 31, 1993...........................................         19 7/8            13 7/8
     September 1, 1993 through November 30, 1993....................................         24 7/8            18 7/8
     December 1, 1993 through December 31, 1993.....................................         20 3/4            19
1994
     First Quarter (through March 10, 1994).........................................   $                 $
</TABLE>

 
     No  dividends have been paid or declared  on the SEPSCO Common Stock in the
three most recent full fiscal years, in the ten month period from March 1,  1993
to December 31, 1993 ('SEPSCO Transition 1993') or in the current year to date.
 
     Under  the  provisions  of the  11  7/8%  Debentures, the  payment  of cash
dividends and the acquisition of shares of SEPSCO's capital stock by SEPSCO  are
limited  to the sum  of (i) 50%  of the aggregate  consolidated net income after
November 30, 1982 (exclusive of equity in the net income (loss) of  affiliates),
(ii)  the aggregate  net proceeds  received from the  sale of  capital stock and
(iii) $7.5  million. Under  such provisions,  at November  30, 1993  SEPSCO  was
permitted  to pay cash dividends or acquire  shares of SEPSCO's capital stock up
to an  aggregate amount  of  approximately $4.1  million.  The payment  of  cash
dividends  is  also  dependent upon,  among  other things,  the  availability of
current  and  retained  earnings.  SEPSCO  does  not  presently  anticipate  the
declaration of cash dividends on the SEPSCO Common Stock in the near future.
 
     As  of  March 7,  1994, there  were approximately  2,400 record  holders of
SEPSCO Common  Stock. At  such date,  all of  the outstanding  shares of  SEPSCO
Preferred  Stock  (consisting  of  490 shares  of  such  SEPSCO  Preferred Stock
convertible into 8,167 shares of SEPSCO Common Stock) were held by Triarc.
 
                                       62

<PAGE>
                                     TRIARC
                                 CAPITALIZATION
 
     The  following  table  sets  forth  the  actual  capitalization  of  Triarc
Companies as of October 31, 1993 and  as adjusted to give effect to the  Merger.
This  table  should  be  read in  conjunction  with  the  Consolidated Financial
Statements of Triarc Companies, Inc.  and Subsidiaries and the Triarc  Companies
Pro  Forma Financial  Statements and  related notes  thereto appearing elsewhere
herein.
 
<TABLE>
<CAPTION>
                                                                                           ACTUAL
                                                                                         OCTOBER 31,
                                                                                            1993        AS ADJUSTED
                                                                                         -----------    -----------
                                                                                               (IN MILLIONS)
<S>                                                                                      <C>            <C>
Current portion of long-term debt:
     Term loan........................................................................     $  10.5        $  10.5
     11 7/8% Debentures...............................................................         9.0            9.0
     13 1/8% Debentures...............................................................         7.0            7.0
     16 7/8% Debentures...............................................................         6.5            6.5
     Other current debt, principally capital lease obligations and notes payable
      secured by machinery and equipment..............................................         5.8            5.8
                                                                                         -----------    -----------
          Total current portion of long-term debt.....................................        38.8           38.8
                                                                                         -----------    -----------
Long-term debt:
     9 3/4% Senior Notes..............................................................       275.0          275.0
     Term loan........................................................................        67.0           67.0
     Revolving loan...................................................................        81.4           81.4
     11 7/8% Debentures...............................................................        49.4(a)        49.4(a)
     13 1/8% Debentures...............................................................        45.6(a)        45.6(a)
     Other long-term debt, principally capital lease obligations and notes payable
      secured by machinery and equipment..............................................        22.0           22.0
                                                                                         -----------    -----------
          Total long-term debt........................................................       540.4          540.4
                                                                                         -----------    -----------
Redeemable Convertible Preferred Stock................................................        71.8           71.8
Stockholders' equity (deficit)........................................................       (64.7)         (12.3)
                                                                                         -----------    -----------
Total capitalization..................................................................     $ 586.3        $ 638.7
                                                                                         -----------    -----------
                                                                                         -----------    -----------
</TABLE>
 
- ------------
 
 (a) The 11 7/8% Debentures  and the 13 1/8%  Debentures are net of  unamortized
     debt discount of $4,635,000 and $3,417,000, respectively.
 
                                       63
 
<PAGE>
              SOUTHEASTERN PUBLIC SERVICE COMPANY AND SUBSIDIARIES
                                 CAPITALIZATION
 
     The  following table sets forth the capitalization of SEPSCO as of November
30, 1993 and as adjusted to give effect to the Merger and Settlement  Agreement.
This table should be read in conjunction with the SEPSCO historical consolidated
financial  statements and the SEPSCO Pro  Forma Financial Statements and related
notes thereto appearing elsewhere herein.
 
<TABLE>
<CAPTION>
                                                                                          ACTUAL
                                                                                       NOVEMBER 30,
                                                                                           1993        AS ADJUSTED
                                                                                       ------------    -----------
                                                                                              (IN MILLIONS)
<S>                                                                                    <C>             <C>
Current portion of long-term debt:
     11 7/8% Debentures.............................................................      $  9.0         $   9.0
     Due to leasing affiliate.......................................................         1.1(a)          1.1(a)
                                                                                       ------------    -----------
          Total current portion of long-term debt...................................        10.1            10.1
                                                                                       ------------    -----------
Long-term debt:
     11 7/8% Debentures.............................................................        49.7            49.7
     Due to leasing affiliate.......................................................         0.5(b)          0.5(b)
     Equipment notes................................................................         0.5(b)          0.5(b)
                                                                                       ------------    -----------
          Total long-term debt......................................................        50.7            50.7
                                                                                       ------------    -----------
Stockholders' equity................................................................        93.6           119.4
                                                                                       ------------    -----------
Total capitalization................................................................      $154.4         $ 180.2
                                                                                       ------------    -----------
                                                                                       ------------    -----------
</TABLE>
 
- ------------
 
 (a) Includes $0.3 million classified in 'Current portion of long-term debt'  of
     continuing   operations  and  $0.8  million   classified  in  'Net  current
     liabilities of discontinued operations' on SEPSCO's condensed  consolidated
     balance sheet.
 
 (b) Includes   $0.3  million  classified  in   'Long-term  debt  of  continuing
     operations' and  $0.2  million classified  in  'Net non-current  assets  of
     discontinued operations' on SEPSCO's condensed consolidated balance sheet.
 
                                       64

<PAGE>
                    TRIARC COMPANIES, INC. AND SUBSIDIARIES
                           SELECTED FINANCIAL DATA(1)
 
     The following table presents selected consolidated financial data of Triarc
Companies,  Inc. and subsidiaries for each of  the years in the five-year period
ended April 30, 1993 and  for the six-month periods  ended October 31, 1992  and
1993.  The selected  consolidated operating data  for the years  ended April 30,
1991, 1992 and 1993 and the balance sheet data as of April 30, 1992 and 1993 are
derived from consolidated financial statements audited by Arthur Andersen & Co.,
independent certified public accountants, contained elsewhere herein and  should
be read in conjunction therewith and with the notes thereto. Such operating data
for  the years ended April 30, 1989 and  1990 and balance sheet data as of April
30, 1989,  1990 and  1991  are derived  from consolidated  financial  statements
audited  by  Arthur  Andersen &  Co.  not  included herein.  Such  data  for the
six-month periods  ended October  31, 1992  and 1993  has not  been audited  but
reflects,  in the  opinion of  management, all  adjustments (which  include only
normal recurring  adjustments) necessary  to present  fairly the  data for  such
periods.  The interim  results of operations  are not  necessarily indicative of
results to be  expected for full  years. Also presented  are selected pro  forma
consolidated  financial data of Triarc Companies,  Inc. for the year ended April
30, 1993 and  the six-month  period ended October  31, 1993  reflecting (i)  the
issuance  of  an aggregate  2,691,822 common  shares  of Triarc  for all  of the
aggregate 3,364,778 SEPSCO common shares owned by stockholders other than Triarc
Companies in  connection with  the  Merger Agreement  and  (ii) the  payment  of
$1,000,000  of  estimated expenses  related  to the  issuance  of the  stock and
$3,000,000 of estimated  fees and  expenses, all  of which  had been  previously
accrued, related to the Merger as if such transactions had occurred as of May 1,
1992  with respect to  statement of operations  data and as  of October 31, 1993
with respect  to  balance  sheet  data. Such  selected  pro  forma  consolidated
financial  data  are  derived from  the  Triarc Pro  Forma  Financial Statements
contained elsewhere herein and should be read in conjunction therewith and  with
the notes thereto.
<TABLE>
<CAPTION>
                                                     FISCAL YEAR ENDED APRIL 30,
                             ----------------------------------------------------------------------------
                                                                                                   PRO
                                                                                                  FORMA
                               1989         1990          1991          1992          1993         1993
                             --------    ----------    ----------    ----------    ----------    --------
                                               (IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
<S>                          <C>         <C>           <C>           <C>           <C>           <C>
Revenues..................   $987,730    $1,038,923    $1,027,162    $1,074,703    $1,058,274    $1,058,274
Operating profit..........     45,123        61,130        23,304        58,552        34,459      30,191
Income (loss) from
  continuing operations...     (5,851)      (13,966)      (17,501)      (10,207)      (44,549)    (50,114)
Discontinued operations,
  net.....................      3,250         1,072           (55)        2,705        (2,430)
Extraordinary items,
  net.....................      1,807         1,363           703        --            (6,611)
Cumulative effect of
  changes in accounting
  principles, net.........      --           --            --            --            (6,388)
Net loss..................       (794)      (11,531)      (16,853)       (7,502)      (59,978)
Preferred stock dividend
  requirements............       (580)          (14)          (11)          (11)         (121)
Net loss applicable to
  common stockholders(2)..     (1,374)      (11,545)      (16,864)       (7,513)      (60,099)
Loss per share:
    Continuing
      operations..........       (.39)         (.55)         (.68)         (.39)        (1.73)      (2.36)
    Discontinued
      operations..........        .20           .04        --               .10          (.09)
    Extraordinary items...        .11           .06           .03        --              (.26)
    Cumulative effect of
      changes in
      accounting
      principles..........      --           --            --            --              (.25)
    Net loss..............       (.08)         (.45)         (.65)         (.29)        (2.33)
Total assets..............    860,709       863,993       851,912       821,170       910,662
Long-term debt............    409,418       407,353       345,860       289,758       488,654
Redeemable preferred
  stock...................      --           --            --            --            71,794
Stockholders' equity
  (deficit)...............    117,646       109,052        92,529        86,482       (35,387)
Weighted-average common
  shares outstanding......     16,669        25,428        25,853        25,867        25,808      23,712
 
<CAPTION>
                               SIX MONTHS ENDED OCTOBER 31,
                             --------------------------------
                                                       PRO
                                                      FORMA
                               1992        1993        1993
                             --------    --------    --------
 
<S>                          <C>         <C>         <C>
Revenues..................   $522,371    $521,470    $521,470
Operating profit..........     32,129      22,253     21,476
Income (loss) from
  continuing operations...     (4,398)    (19,628)   (20,574 )
Discontinued operations,
  net.....................      2,016      (7,168)
Extraordinary items,
  net.....................      --           (448)
Cumulative effect of
  changes in accounting
  principles, net.........     (6,388)      --
Net loss..................     (8,770)    (27,244)
Preferred stock dividend
  requirements............         (5)     (2,916)
Net loss applicable to
  common stockholders(2)..     (8,775)    (30,160)
Loss per share:
    Continuing
      operations..........       (.17)      (1.06)      (.98 )
    Discontinued
      operations..........        .08        (.34)
    Extraordinary items...      --           (.02)
    Cumulative effect of
      changes in
      accounting
      principles..........       (.25)      --
    Net loss..............       (.34)      (1.42)
Total assets..............                913,439    944,830
Long-term debt............                540,355    540,355
Redeemable preferred
  stock...................                 71,794     71,794
Stockholders' equity
  (deficit)...............                (64,749)   (12,298 )
Weighted-average common
  shares outstanding......                 21,239     23,931
</TABLE>
 
- ------------
(1) Selected  Financial  Data have  been retroactively  restated to  reflect the
    discontinuance of SEPSCO's utility and municipal services, refrigeration and
    natural gas and oil operations in  1993. On December 9, 1993 SEPSCO's  Board
    of Directors decided the natural gas and oil business will be transferred to
    Triarc  rather than  SEPSCO selling it  to an independent  third party. Such
    transfer will  be in  the  form of  a  sale of  the  stock of  the  entities
    comprising  the natural gas  and oil business  for cash. It  is intended for
    this sale to occur following the Merger and the resulting elimination of the
    minority interest in SEPSCO. However, should  the Merger not be approved  by
    the  SEPSCO stockholders the  sale of the  stock of the  natural gas and oil
    entities for cash to Triarc will be completed prior to July 22, 1994.
(2) Triarc has not paid  any dividends on  its common shares  during any of  the
    periods presented.
 
                                       65

<PAGE>
              SOUTHEASTERN PUBLIC SERVICE COMPANY AND SUBSIDIARIES
                           SELECTED FINANCIAL DATA(1)
 
     The following table presents selected consolidated financial data of SEPSCO
and  subsidiaries for each of  the years in the  five-year period ended February
28, 1993  and the  nine-month periods  ended  November 30,  1992 and  1993.  The
selected  consolidated operating  data for  the years  ended February  28, 1991,
February 29,  1992 and  February  28, 1993  and the  balance  sheet data  as  of
February  29, 1992 and February 28, 1993 are derived from consolidated financial
statements audited  by  Arthur  Andersen &  Co.,  independent  certified  public
accountants,  contained  elsewhere  herein  and should  be  read  in conjunction
therewith and with the  notes thereto. Such operating  data for the years  ended
February  28, 1989 and 1990 and balance sheet data as of February 28, 1989, 1990
and 1991 are derived  from consolidated financial  statements audited by  Arthur
Andersen  & Co. not included herein. Such  data for the nine-month periods ended
November 30, 1992 and 1993 has not been audited but reflects, in the opinion  of
management,  all adjustments  (which include only  normal recurring adjustments)
necessary to present fairly  the data for such  periods. The interim results  of
operations  are not  necessarily indicative of  results to be  expected for full
years. Also presented are selected pro  forma consolidated financial data as  of
November  30, 1993 reflecting the Merger and  the payment of expenses related to
the Merger  and  Settlement  Agreement. Such  selected  pro  forma  consolidated
financial  data  are  derived from  the  SEPSCO Pro  Forma  Financial Statements
contained elsewhere herein and should be read in conjunction therewith and  with
the notes thereto.
<TABLE>
<CAPTION>
                                                   FISCAL YEAR ENDED FEBRUARY 28 OR 29,
                                            ---------------------------------------------------
                                             1989       1990       1991       1992       1993
                                            -------    -------    -------    -------    -------
                                                  (IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
<S>                                         <C>        <C>        <C>        <C>        <C>
Net sales................................   $24,134    $27,104    $29,154    $29,220    $28,520
Operating profit.........................     4,045      3,922      3,181      4,571      3,634
Income (loss) from continuing operations
  before equity in cumulative effect of
  changes in accounting principles and
  extraordinary items....................      (632)     7,716      4,245      6,332     12,572
Income (loss) from discontinued
  operations, net of income taxes........      (425)    (2,256)    (7,899)      (225)    (5,542)
Cumulative effect of changes in
  accounting principles of:
    SEPSCO...............................     --         --         --         --         --
    Equity in affiliates, net of taxes...     --         --         --         --        (5,954)
Equity in extraordinary items of
  affiliates.............................     1,226        748        794      --          (348)
Net income (loss)........................       169      6,208     (2,860)     6,107        728
Preferred stock dividend requirements....       (24)       (16)        (8)        (1)        (1)
Net income (loss) applicable to common
  stockholders(2)........................       145      6,192     (2,868)     6,106        727
Income (loss) per share(3):
    Continuing operations................      (.05)       .66        .36        .54       1.08
    Discontinued operations..............      (.04)      (.19)      (.68)      (.02)      (.48)
    Cumulative effect of changes in
      accounting principles of
      affiliate..........................     --         --         --         --          (.51)
    Extraordinary items of affiliate.....       .10        .06        .07      --          (.03)
    Net income (loss)....................       .01        .53       (.25)       .52        .06
Total assets.............................   206,882    196,498    191,788    208,330    206,253
Long-term debt included in continuing
  operations.............................    79,908     71,845     64,373     56,826     49,661
Long-term debt of discontinued
  operations.............................    19,383     18,146     17,973     18,070     16,992
Stockholders' equity.....................    82,672     88,503     85,010    107,503    108,230
 
<CAPTION>
                                                        NINE MONTHS ENDED NOVEMBER
                                                                    30,
                                                       -----------------------------
                                              PRO                              PRO
                                             FORMA                            FORMA
                                             1993       1992       1993       1993
                                            -------    -------    -------    -------
 
<S>                                         <C>        <C>        <C>        <C>
Net sales................................   $28,520    $18,944    $19,760    $19,760
Operating profit.........................    2,602       1,705        354      (420 )
Income (loss) from continuing operations
  before equity in cumulative effect of
  changes in accounting principles and
  extraordinary items....................   11,540       7,366      1,183       409
Income (loss) from discontinued
  operations, net of income taxes........                  938    (23,355)
Cumulative effect of changes in
  accounting principles of:
    SEPSCO...............................                --         7,617
    Equity in affiliates, net of taxes...               (5,954)      (102)
Equity in extraordinary items of
  affiliates.............................                --         --
Net income (loss)........................                2,350    (14,657)
Preferred stock dividend requirements....                   (1)        (1)
Net income (loss) applicable to common
  stockholders(2)........................                2,349    (14,658)
Income (loss) per share(3):
    Continuing operations................     1.39         .63        .10       .05
    Discontinued operations..............                  .08      (2.00)
    Cumulative effect of changes in
      accounting principles of
      affiliate..........................                 (.51)       .64
    Extraordinary items of affiliate.....                --         --
    Net income (loss)....................                  .20      (1.26)
Total assets.............................                         171,130    196,227
Long-term debt included in continuing
  operations.............................                          50,501    50,501
Long-term debt of discontinued
  operations.............................                             277       277
Stockholders' equity.....................                          93,572    119,369
</TABLE>
 
- ------------
 
(1) Selected  Financial  Data have  been retroactively  restated to  reflect the
    discontinuance of utility and municipal services, refrigeration and  natural
    gas and oil operations in 1993.
 
(2) SEPSCO  has not paid  any dividends on  its common shares  during any of the
    periods presented.
 
(3) Weighted average common shares outstanding  were 11,655,067 for each of  the
    historical periods presented. For pro forma periods, weighted average shares
    outstanding were 8,290,289 after giving effect to 3,364,778 shares of SEPSCO
    Common  Stock assumed  to be  exchanged for Triarc  Class A  Common Stock in
    connection with the Merger.
 
                                       66

<PAGE>
                          BUSINESS OF TRIARC COMPANIES
 
INTRODUCTION
 
     Triarc Companies is engaged in four core businesses: soft drink, fast food,
textiles  and liquefied petroleum  gas. The soft  drink operations are conducted
through RC Cola;  the fast  food operations  are conducted  through Arby's;  the
textile  operations  are  conducted  through  Graniteville;  and  the  liquefied
petroleum gas  operations  are  conducted  through  the  LP  Gas  Companies.  In
addition,  Triarc, through a number of direct and indirect subsidiaries, is also
currently engaged in a number of non-core businesses, substantially all of which
it intends to  dispose of or  liquidate as  part of its  business strategy.  See
' -- General -- Discontinued and Other Operations.'
 
     Triarc  was  incorporated in  Ohio  in 1929.  Triarc's  principal executive
offices are located at 777 South Flagler Drive, West Palm Beach, Florida  33401.
The Company's telephone number is (407) 653-4000.
 
NEW OWNERSHIP AND EXECUTIVE MANAGEMENT
 
     On April 23, 1993, DWG Acquisition acquired shares of Triarc Class A Common
Stock  from the  Posner Entities  representing approximately  28.6% of  the then
outstanding Triarc Class A Common Stock. As a result of the Equity Transactions,
the Posner Entities no longer hold any  shares of voting stock of Triarc or  any
of   its  subsidiaries.  Concurrently  with   the  consummation  of  the  Equity
Transactions, Triarc refinanced a significant portion  of its high cost debt  in
order  to  reduce interest  costs and  to provide  additional funds  for working
capital and  liquidity  purposes.  Following  the  consummation  of  the  Equity
Transactions, the Triarc Board installed a new corporate management team, headed
by  Nelson Peltz and Peter W. May, who were elected Chairman and Chief Executive
Officer and President and  Chief Operating Officer  of Triarc, respectively.  In
addition,  Leon Kalvaria was  elected Vice Chairman of  Triarc. The Triarc Board
also approved a plan to  decentralize and restructure the Company's  management.
See  'SPECIAL FACTORS -- Background to the Merger; Reasons for the Merger -- The
Reorganization and Related Matters.'
 
BUSINESS STRATEGY
 
     New executive  management has  developed a  business strategy  intended  to
address  the  Triarc  Companies  past  inability  to  attract  strong  operating
management, lack of focused advertising  and marketing programs, and failure  to
make  sufficient  investments  in capital  projects.  The key  elements  of this
business strategy include  (i) focusing  the Triarc Companies  resources on  the
four  core businesses -- soft drink, fast food, textiles and liquefied petroleum
gas, (ii)  building strong  operating  management teams  for  each of  the  core
businesses,   and  permitting  each  of  these  teams  to  operate  in  a  newly
decentralized environment, (iii)  providing strategic  leadership and  financial
resources  to enable  the management  teams to  develop and  implement specific,
growth-oriented business  plans, and  (iv)  rationalizing the  Triarc  Companies
organizational   structure  by  eliminating   minority  interests  and  settling
previously outstanding shareholder litigation.
 
     The new  chief  executive  officers  of the  Triarc  Companies'  four  core
businesses, three of whom came from outside the Triarc Companies, have developed
and  begun  to implement  individual plans  focused  on increasing  revenues and
improving operating efficiency.  In addition,  the Triarc  Companies expects  to
undertake,  and is actively pursuing,  acquisitions and business combinations to
augment the four core  businesses and dispositions  of the non-core  businesses.
The  implementation of  the Triarc  Companies business  strategy is  expected to
result in significant increases in expenditures for, among other things, capital
projects and acquisitions and, over time, marketing and advertising. To  provide
liquidity to finance these expenditures and to reduce interest costs, as part of
the Refinancing and the RC/Arby's Refinancing, the Triarc Companies refinanced a
significant portion of its high cost debt.
 
                                       67
 
<PAGE>
     The  first  steps  of  this  strategic  program  have  already  been taken,
including:
 
      In late April 1993, new chief  executive officers were appointed for  each
      of the the Triarc Companies' four core businesses. Three of these officers
      came  from outside the Triarc  Companies: John C. Carson  (RC Cola) who is
      the former President of Cadbury Beverages, North America; Donald L. Pierce
      (Arby's) who  is  the  former  President of  Denny's  and  Kentucky  Fried
      Chicken  -- International; and Ronald Paliughi (National Propane) who is a
      former senior officer of AmeriGas.  In addition, Harold D. Kingsmore,  who
      was  previously chief operating  officer of Graniteville,  was named chief
      executive officer of Graniteville.
 
      As part of  the Refinancing,  Graniteville entered  into the  Graniteville
      Credit  Facility which provided Graniteville with an $80 million term loan
      and $100 million  revolving credit  facility (of which  $11.0 million  was
      available  at  December  31,  1993).  The  Graniteville  Credit  Facility,
      together with Graniteville's  operating cash flow,  provides liquidity  to
      fund Graniteville's working capital and capital expenditure requirements.
 

      In  August 1993, RC/Arby's sold $275 million aggregate principal amount of
      9 3/4% Senior  Notes. A portion  of the proceeds  from this financing  was
      used  to redeem $225 million aggregate  principal amount of Step-Up Notes.
      As of December 31, 1993, RC/Arby's had cash on hand of approximately $55.2
      million to fund certain of RC Cola's and Arby's strategic programs.

      The Triarc Companies  reduced its corporate  staff from more  than 200  to
      less  than 100 employees.  At the same  time, each of  RC Cola, Arby's and
      National Propane strengthened its own management team.
 
      In October 1993, SEPSCO's utility and municipal services business  segment
      was sold. After the payment of the outstanding balance of $24.5 million of
      related  capitalized leases on  the closing date of  the sale, and setting
      aside amounts for  taxes, transaction  expenses and  related matters,  the
      disposition  of this business segment  increased the Triarc Companies' net
      cash available for investment in the four core businesses by approximately
      $37.1 million.
 

      In November 1993, SEPSCO entered into the Letter of Intent to sell the Ice
      Business for $5  million in  cash and approximately  $4 million  principal
      amount  of subordinated secured notes due  on the fifth anniversary of the
      sale and the assumption by  the purchaser of certain current  liabilities.
      The  Letter of Intent, by its terms, expired on January 11, 1994, although
      the  parties  are  still  continuing  discussions  with  respect  to   the
      transaction contemplated by the Letter of Intent.


      In  January 1994, Triarc disposed of its 58.6% interest in Wilson Brothers
      ('Wilson Brothers'),  a company  engaged in  the specialty  decoration  of
      glass  and ceramic  items and the  design, manufacturing  and servicing of
      overhead industrial  cranes.  In  February  1994,  Triarc  sold  its  lamp
      manufacturing business to certain members of operating management for $5.5
      million in cash and a note in the principal amount of $0.5 million.

 
      Triarc  is proceeding with its plans  to sell or discontinue substantially
      all of  its  remaining non-core  businesses,  including the  Cold  Storage
      Business  of SEPSCO and the ownership  of certain grapefruit groves. Given
      Triarc's focus on its  four core businesses, Triarc  may sell the  natural
      gas  and oil  businesses that Triarc  has agreed in  principle to purchase
      from SEPSCO. No assurance can be given  as to the time frame within  which
      such businesses may be sold.
 
      Triarc's  corporate headquarters and the headquarters of three of its four
      core businesses have been  relocated to more  modern and efficient  office
      space.
 
     The estimated costs associated with substantially all of these actions were
reflected  either in Triarc Companies' results  of operations for Fiscal 1993 or
for the six months ended October  31, 1993. See 'TRIARC MANAGEMENT'S  DISCUSSION
AND  ANALYSIS OF FINANCIAL CONDITION AND RESULTS  OF OPERATIONS,' Note 19 to the
Fiscal 1993  Consolidated Financial  Statements of  Triarc Companies,  Inc.  and
Subsidiaries  and Note 12 to the  Condensed Consolidated Financial Statements of
Triarc Companies, Inc. and Subsidiaries.
 
                                       68
 
<PAGE>
ORGANIZATIONAL STRUCTURE
 
     The following chart sets forth  the organizational structure of the  Triarc
Companies,  excluding certain  non-core businesses  that are  in the  process of
being disposed of or discontinued.

                              <ORGANIZATIONAL CHART>
 
(1) After the Merger, Triarc will directly or indirectly own 100% of each of its
    core businesses.
 
BUSINESS SEGMENTS
 
                              SOFT DRINK (RC COLA)
 
     RC Cola produces concentrates used in  the production of soft drinks  which
are  sold domestically and internationally to independent, licensed bottlers who
manufacture and distribute finished beverage products. RC Cola's major  products
have  strong brand  recognition and  include: RC COLA,  DIET RC  COLA, DIET RITE
COLA, DIET RITE flavors, NEHI,  UPPER 10 and KICK. In  addition, RC Cola is  the
exclusive  supplier of proprietary cola concentrate  to Cott which sells private
label soft drinks  to major  retailers such as  Wal-Mart, A&P  and Safeway.  For
information  with respect to RC Cola's revenues, operating profit and assets for
the last three fiscal  years, see 'Consolidated  Financial Statements of  Triarc
Companies, Inc. and Subsidiaries.'
 
     RC  COLA is the third largest national  brand cola and is the only national
brand cola available to non-Coca Cola and non-Pepsi-Cola bottlers. DIET RITE  is
available  in a cola  as well as  various other flavors  and formulations and is
sugar-free (sweetened with 100% aspartame, an artificial sweetener), sodium-free
and caffeine-free. It is the only  national brand sodium-free soft drink on  the
market.  DIET RC COLA is the low-calorie version of RC COLA containing aspartame
as its  sweetening agent.  NEHI is  a  line of  approximately 20  flavored  soft
drinks,  UPPER 10 is a lemon-lime soft drink and KICK is a citrus soft drink. RC
Cola's  share  of  the  overall  domestic  carbonated  soft  drink  market   was
approximately  2.2% in 1993 according to  The Maxwell Consumer Report. RC Cola's
soft drink brands have  a share of national  supermarket sales of  approximately
2.9%, as measured by Nielsen Marketing Research.
 
                                       69
 
<PAGE>
     John  C.  Carson joined  RC Cola  on May  10, 1993  as President  and Chief
Executive Officer. Prior to joining RC Cola, Mr. Carson was President of Cadbury
Beverages,  North  America,  where  he   worked  with  a  bottling  network   of
approximately 900 bottlers, including many existing RC Cola bottlers. Mr. Carson
has over 25 years of experience in the beverage business, including positions in
sales, marketing and administration. Since joining RC Cola, Mr. Carson has hired
key  senior finance, marketing and operations  executives to form the nucleus of
the RC Cola management team.
 
BUSINESS STRATEGY
 
     RC Cola's new  management believes that  the RC Cola  products continue  to
enjoy significant brand recognition. RC Cola's new management also believes that
the  full potential of the RC Cola franchise, however, has not been realized due
to  unfocused  spending  on  marketing  and  advertising,  inefficient   product
distribution, and generally poor relationships between RC Cola and its bottlers.
Furthermore,  RC Cola's new management believes that there is an opportunity for
RC Cola to address these issues, and increase sales and earnings through a newly
formulated business strategy. The key elements of this strategy include:
 
       More Effective Advertising  and Marketing: The  principal determinant  of
       success  in the industry  is the ability to  establish a recognized brand
       name, the  lack of  which serves  as the  industry's primary  barrier  to
       entry.  Historically,  the  marketing  expenditures of  RC  Cola  and its
       bottlers have emphasized couponing and sponsorship of local and  regional
       sporting  events rather  than coordinated media  spending that reinforces
       the image of  the brands across  markets. RC Cola  management intends  to
       increase  its 1994 marketing  budget by $5 million  and to reallocate $14
       million of  this  increased  budget to  media  advertising  and  regional
       promotions,  including a new advertising and marketing campaign developed
       by a  recently  hired outside  advertising  agency. Thereafter,  RC  Cola
       management  expects to increase the overall  level of RC Cola's marketing
       and advertising expenditures.
 
       Improved Bottler Relationships: Senior management of the Triarc Companies
       and RC Cola are working to develop a long-term partnership with RC Cola's
       bottlers. RC Cola management believes that the implementation of the  new
       advertising  and  marketing program  described  above will  encourage the
       bottlers to  increase  their  own  marketing  expenditures,  as  well  as
       coordinate  promotional activity more  closely with RC  Cola. Finally, RC
       Cola is actively pursuing  arrangements with Cott that  could lead to  an
       increase in private label bottling by the RC Cola bottling network.
 
       Expansion of Private Label Business: The domestic market share of private
       label  soft  drinks  has  increased rapidly  in  the  past  several years
       reflecting  the  emphasis  of  many  retailers  on  the  development  and
       marketing  of  quality  store brand  merchandise  at  competitive prices.
       Private label sales to Cott represent  the fastest growing segment of  RC
       Cola's  business, more  than doubling  from Fiscal  1992 to  Fiscal 1993.
       Private label sales to  Cott during Transition  1993 exceeded such  sales
       for Fiscal 1993. In January 1994, RC Cola and Cott agreed on the terms of
       the  Cott  Worldwide Agreement,  which  will supersede  the  Current Cott
       Agreement. Under the  Cott Worldwide  Agreement, RC Cola  will be  Cott's
       exclusive  worldwide supplier  of cola  concentrates for retailer-branded
       beverages in various containers. In addition, wherever possible, RC  Cola
       will  also supply Cott's requirements  for non-cola carbonated soft drink
       concentrates. RC  Cola's  management  believes that  the  Cott  Worldwide
       Agreement  will  benefit  RC  Cola significantly  by  both  expanding the
       markets  for  which  RC  Cola  is  Cott's  exclusive  supplier  of   cola
       concentrates,   and  significantly  increasing   the  portion  of  Cott's
       requirements for non-cola  carbonated soft drink  concentrates which  are
       supplied by RC Cola.
 
       Improved  Distribution  in  Key  Channels:  Based  on  independent market
       research, RC Cola management believes that better distribution of RC Cola
       products in the key  'take home' channels (such  as food stores and  drug
       stores)  will increase  the market  share of RC  Cola brands.  RC Cola is
       beginning to provide bottlers with timely and reliable market information
       to identify retailers  that do  not distribute  RC Cola  products and  to
       monitor  the inventory positions of the  various RC Cola brands in stores
       where the  products  are  currently  distributed  to  limit  out-of-stock
       positions.
 
                                       70
 
<PAGE>
       New   Channels  of  Distribution:  RC  Cola's  management  believes  that
       distribution of RC Cola brands  through vending machines and  convenience
       outlets  (such as convenience stores and  retail gas mini-markets) can be
       expanded significantly. This strategy  has been implemented by  arranging
       for   the  leasing  of  approximately  9,300  vending  machines  and  the
       subleasing  of  this  equipment  to  bottlers  to  encourage  service  of
       convenience  outlets. In addition,  as part of this  strategy, RC Cola is
       also considering a program for the leasing of cold storage boxes and  and
       the subleasing of them to bottlers to further encourage such service.
 
       International  Expansion: While the financial and managerial resources of
       RC Cola have initially been focused  on the United States and Canada,  RC
       Cola  management  believes that  there  are significant  opportunities to
       increase the  international  penetration  of RC  Cola  brands.  In  those
       countries  where RC  Cola brands are  currently distributed,  RC Cola has
       provided limited  advertising  support  due to  capital  constraints.  RC
       Cola's  brands  have  not  yet  been distributed  in  a  number  of major
       international markets, including Chile and Brazil in Latin America,  Hong
       Kong  and China in the Far East and Russia, Poland, Spain and Portugal in
       Europe. To support  expansion in  these markets, new  managers have  been
       added  for Latin  America and Europe,  and outside  consultants have been
       hired for the  countries of the  former Soviet Union.  These markets  are
       currently targeted for development during 1994.
 
       Acquisitions:  RC Cola  management is  actively seeking  to expand market
       share through the acquisition of additional soft drink product lines.  RC
       Cola  management  believes that  providing  additional product  lines and
       nationally  recognized  soft  drink  brands   will  assist  RC  Cola   in
       strengthening  its relationships with  its bottlers and  allow RC Cola to
       leverage its marketing and administrative activities.
 
INDUSTRY
 
     Soft drinks  constitute  one of  the  largest consumer  food  and  beverage
categories  in the United States, with retail sales of approximately $50 billion
in calendar 1993 as measured by Jesse Meyers Beverages Digest. Trends  affecting
the  soft drink industry  in recent years  have included the  growth of consumer
demand for diet soft  drinks, the increased market  share of private label  soft
drinks,  and the recent  introduction of 'new age'  beverages. In calendar 1993,
diet drinks represented approximately 29.1%  of the soft drink market,  compared
to approximately 19% in 1981. The share of the cola category of soft drink sales
in  all food  stores, as measured  by Nielsen Marketing  Research, declined from
61.3% in calendar 1989 to 59.2% in  1993. This decline is attributable in  large
part  to  the  decline in  sales  of  sugar-sweetened cola  drinks,  whose share
declined from 41.0% in calendar 1989 to  38.6% in 1993, while the share of  diet
cola  drinks over  the period  remained stable  at approximately  20.6%. RC Cola
management believes  that the  market share  of private  label soft  drinks,  as
measured  by Nielsen  Marketing Research,  increased from  approximately 7.2% in
calendar 1989 to approximately 11.1% in 1993, reflecting the expansion in  sales
of  private label products generally as retailers have placed increased emphasis
on  the  development  and  marketing  of  quality  store  brand  merchandise  at
competitive  prices. RC  Cola management  believes that  the share  of 'new age'
beverages (such as carbonated fruit  drinks, natural sodas and seltzers,  sports
drinks  and iced teas) in the soft  drink market is currently approximately 7.5%
in terms of volume and will continue  to increase at the expense of  traditional
soft drinks.
 
                                       71
 
<PAGE>
PRODUCTS
 
     The  following chart sets  forth RC Cola's product  mix of branded products
for Fiscal 1993 and Transition 1993:
 
<TABLE>
<CAPTION>
                                                           FISCAL 1993                 TRANSITION 1993
                                                    --------------------------    --------------------------
                                                      UNITS OF                      UNITS OF
                 BRANDED PRODUCT                    CONCENTRATE*    PERCENTAGE    CONCENTRATE*    PERCENTAGE
- -------------------------------------------------   ------------    ----------    ------------    ----------
<S>                                                 <C>             <C>           <C>             <C>
RC Cola..........................................       689,952          55%          451,276          55%
Diet Rite Cola...................................       321,604          26           194,423          24
Nehi.............................................       100,448           8            73,143           9
Diet Rite Flavors................................        88,304           7            52,772           7
Diet RC..........................................        31,836           2            16,842           2
Others...........................................        23,836           2            26,387           3
                                                    ------------        ---       ------------        ---
     Total.......................................     1,255,980         100%          814,843         100%
                                                    ------------        ---       ------------        ---
                                                    ------------        ---       ------------        ---
</TABLE>
 
- ------------
 
*  One domestic unit equals concentrate sufficient to produce an average of  144
   cases, each consisting of 24 eight-ounce containers, of finished product.
 
ADVERTISING AND MARKETING
 
     The  principal determinant  of success  in the  soft drink  industry is the
ability to establish a recognized  brand name, the lack  of which serves as  the
industry's  primary  barrier  to entry.  Advertising,  promotions  and marketing
expenditures in Fiscal 1992, Fiscal 1993 and Transition 1993 were $51.0 million,
$54.6 million  and  $54 million,  respectively.  However, RC  Cola  historically
focused  a large proportion of these expenditures on local and regional sporting
event sponsorship, couponing and in-store/point of sale promotions. In addition,
media spending was  not well-coordinated across  regions or with  the timing  of
bottler  promotions. RC  Cola believes that,  in spite  of unfocused advertising
spending over the last several years, its products continue to enjoy  nationwide
brand recognition.
 
     RC  Cola management  intends to  increase its  1994 marketing  budget by $5
million and  to  reallocate  $14  million of  this  increased  budget  to  media
advertising  and  regional  promotions.  In August  1993,  RC  Cola  hired GSD&M
Advertising to produce and coordinate  new media advertising campaigns for  both
regional  and national  distribution and to  coordinate these  campaigns with RC
Cola's bottlers.
 
RC COLA'S BOTTLER NETWORK
 
     In addition to  highly recognized  brands, a  strong bottler  network is  a
critical determinant of the success of a soft drink producer. Analysis of market
share  by distributor indicates that a strong bottler can substantially increase
the share of RC Cola brand  products in that bottler's local market.  Therefore,
good  relations with  its bottlers, and  a strong bottler  network, are critical
factors for RC Cola.  As RC Cola's relationships  with its bottlers improve,  RC
Cola  management believes that  its bottlers, the majority  of whom also provide
bottling services to other brands, will tend to focus more on RC Cola  products.
This  increase in focus on  RC Cola products is  expected to result in increased
participation  by  the  bottlers  in  cooperative  advertising,  marketing   and
promotion  activities,  as  well  as added  emphasis  on  improving  shelf space
positions for RC Cola  brands with retailers and  closer monitoring of  retailer
inventory positions, thus reducing out-of-stock positions.
 
     RC   Cola  sells  its  flavoring   concentrates  for  branded  products  to
independent franchised bottlers in the  United States and 53 foreign  countries,
including Canada. Consistent with industry practice, each bottler is assigned an
exclusive  territory within which no other  bottler may distribute RC Cola brand
soft drinks. This type of  arrangement is designed to  help ensure that RC  Cola
has  a strong  distributor in each  market served.  As of December  31, 1993, RC
Cola's products were  packaged and  distributed domestically  in 158  franchised
territories. There were a total of 61 production and distribution agreements and
97 distribution only agreements, covering 50 states.
 
     In  most  localities,  licensed RC  Cola  bottlers  also hold  one  or more
franchises from other concentrate manufacturers, although RC Cola bottlers (like
bottlers of Coca-Cola and Pepsi-Cola) are
 
                                       72
 
<PAGE>
not  permitted  to  distribute  other   colas.  Of  RC  Cola's  158   franchised
territories,  Triarc believes 76  carry RC Cola  as the lead  brand, 38 carry RC
Cola with 'Seven-Up' as the  lead brand, 17 carry RC  Cola with 'Dr. Pepper'  as
the  lead brand, and the remaining 27  are classified as mixed. The existence of
RC Cola enables non-Coca-Cola and non-Pepsi-Cola  bottlers to offer a full  line
of  branded cola products,  better positioning them to  compete with bottlers of
Coca-Cola and Pepsi-Cola.
 
     The following table  sets forth the  percentage of domestic  unit sales  of
concentrate  for branded product accounted for by  each of RC Cola's ten largest
bottler groups during Fiscal 1993 and Transition 1993:
 
<TABLE>
<CAPTION>
                                                                                  PERCENT OF UNIT SALES
                                                                              ------------------------------
                               BOTTLER GROUP                                  FISCAL 1993    TRANSITION 1993
- ---------------------------------------------------------------------------   -----------    ---------------
<S>                                                                           <C>            <C>
Chicago Bottling Group.....................................................       22.3%            25.4%
All American Bottling......................................................       16.1             16.9
Brooks Beverage Management Inc. ...........................................        7.2              8.3
7UP/RC Bottling of Southern California.....................................        7.0              8.0
RC Bottling Co. -- Evansville, IN..........................................        3.7              4.0
Mid-Continent Bottlers.....................................................        2.9              3.5
Kalil Bottling-Arizona.....................................................        2.7              3.4
Dr. Pepper Bottling-Texas..................................................        2.3              2.7
Beverage Properties Inc....................................................        2.2              2.4
Bland Group................................................................        1.9              2.3
                                                                                 -----            -----
          Total............................................................       68.3%            76.9%
                                                                                 -----            -----
                                                                                 -----            -----
</TABLE>
 
     RC Cola enters into a license agreement with each of its bottlers which  it
believes   are  comparable  to  those  prevailing   in  the  industry.  RC  Cola
periodically sets a uniform price list  for concentrate for all of its  licensed
bottlers.  The length of the license agreements  vary, but RC Cola may terminate
any such agreement in the event of a material breach of the terms thereof by the
bottler that is not cured within a specified period of time.
 
     The license agreements  require producing bottlers  to manufacture RC  Cola
soft  drinks in  strict accordance with  the standards,  formulae and procedures
established by RC Cola and to package the products in containers specified by RC
Cola. Each bottler is obligated to  operate within its exclusive territory  with
adequate  manufacturing, packaging  and distribution  capability to  produce and
distribute sufficient quantities of RC Cola products to meet consumer demand  in
the  territory and to  maintain an inventory  of RC Cola  products sufficient to
supply promptly the  reasonably foreseeable demand  for such products.  Bottlers
that  operate distribution facilities  and do not  operate production facilities
purchase RC Cola products from producing bottlers.
 
     Total  concentrate  sales  in  the   New  York  City  region  declined   by
approximately   39,000  units  (69%),  from  4.1%  to  1.5%  of  total  domestic
concentrate sales, between 1989 and 1993. This decrease was attributable to  the
bankruptcy  of one of the two RC Cola bottlers in the region and the liquidation
of the other. RC Cola entered into  license agreements with two new bottlers  in
the  New York City  region in December 1991.  Sales in the  New York City region
were approximately  18,500  units  during  1993,  representing  an  increase  of
approximately 4% from the 17,800 units sold during 1992. The market share in the
New  York  City  region of  the  RC Cola  brands,  as  measured in  a  survey of
supermarket sales conducted  by Nielsen Marketing  Research, has increased  from
1.0%  in calendar  1992 to  1.2% in  calendar 1993.  There can  be no assurance,
however, that these agreements will continue to result in RC Cola restoring lost
market share in the New York City region.
 
PRIVATE LABEL
 
     RC Cola believes that private label  sales through Cott represent a  growth
opportunity  due  to  the  increased  emphasis  by  national  retailers  on  the
development and  marketing of  quality store  brand merchandise  at  competitive
prices.  RC Cola's private  label sales began  in late 1990  and grew, as Cott's
business has expanded, from approximately 309,000 units of concentrate in Fiscal
1992 to approximately  623,000 units  in Fiscal 1993  and approximately  798,000
units in Transition 1993. In Fiscal 1993 and
 
                                       73
 
<PAGE>
Transition  1993,  revenues  from sales  of  private label  concentrate  to Cott
represented approximately  10.6% and  10.9%, respectively,  of RC  Cola's  total
revenues.  RC Cola  is currently providing  concentrate to Cott  pursuant to the
Current Cott Agreement, under which RC Cola is Cott's exclusive supplier of cola
concentrates for private label and Cott's  proprietary label soft drinks in  the
United States and Canada.
 
     In January 1994, RC Cola and Cott agreed on the terms of the Cott Worldwide
Agreement,  which will supersede the Current Worldwide Agreement. Under the Cott
Worldwide Agreement, RC Cola will be Cott's exclusive worldwide supplier of cola
concentrates for retailer-branded beverages in various containers. In  addition,
wherever  possible, RC  Cola will also  supply Cott's  requirements for non-cola
carbonated soft drink concentrates. The  Cott Worldwide Agreement requires  that
Cott  purchase at least  75% of its total  worldwide requirements for carbonated
soft drink concentrates  from RC Cola.  The initial term  of the Cott  Worldwide
Agreement is 21 years, with multiple six-year renewable terms.
 
     Cott  delivers  the private  label concentrate  and packaging  materials to
independent bottlers for bottling.  The finished private  label product is  then
shipped  to Cott's trade customers, including  major retailers such as Wal-Mart,
A&P and Safeway.  The Cott Worldwide  Agreement provides that,  so long as  Cott
purchases  a specified minimum  number of units of  private label concentrate in
each year of the Cott Worldwide Agreement, RC Cola will not manufacture and sell
private label  carbonated soft  drink concentrates  to parties  other than  Cott
anywhere in the world.
 
     Through  its  private  label  program, RC  Cola  develops  new concentrates
specifically for Cott's private label accounts. The proprietary formulae RC Cola
uses for its private label program  are customer specific and differ from  those
of  RC Cola's branded products. RC Cola works with Cott to develop a concentrate
according to each trade customer's specifications. RC Cola retains ownership  of
the formulae for such concentrates.
 
     Gross  margins for  private label  sales are  lower than  those for branded
sales. However, since most  advertising and marketing  expenses and general  and
administrative  expenses are not attributable  to private label sales, resulting
net operating margins  for branded  sales become  lower than  those for  private
label  sales,  despite the  fact that  net operating  profits for  branded sales
remain higher than those for private label sales on a per-case basis.
 
PRODUCT DISTRIBUTION
 
     Bottlers  distribute  finished  product  through  four  major  distribution
channels: take home (consisting of food stores, drug stores, mass merchandisers,
warehouses  and discount stores); convenience  (consisting of convenience stores
and retail  gas mini-markets);  fountain/food  service (consisting  of  fountain
syrup  sales  and restaurant  single drink  sales);  and vending  (consisting of
bottle and can  sales through vending  machines). The take  home channel is  the
principal channel of distribution for RC Cola products.
 
     In recent years, RC Cola's products have experienced excessive out-of-stock
positions  at  retail outlets.  Management  believes that  providing  timely and
reliable market information to  the bottlers on the  inventory positions of  the
retailers  in their local markets will  allow the bottlers to anticipate out-of-
stocks, and therefore more effectively distribute RC Cola's products.
 
     RC Cola  brands  are  not currently  broadly  distributed  through  vending
machines or convenience outlets. In addition to stimulating trial purchases, the
presence  of  RC  Cola  identified  vending  machines  and  cold  storage  boxes
reinforces consumer  awareness of  the brands.  RC Cola  management,  therefore,
arranged  for the  leasing of approximately  9,300 vending machines  and for the
subleasing of this  equipment to  bottlers to encourage  service of  convenience
outlets.  In addition, as part  of this effort to  stimulate trial purchases, RC
Cola is also considering a program for the leasing of cold storage boxes and the
subleasing of them to bottlers to further encourage such service.
 
INTERNATIONAL
 
     Sales outside the  United States  accounted for approximately  13.0% of  RC
Cola's sales in Transition 1993 and an average of 9.6% for the five fiscal years
from 1989 through 1993. As of December 31, 1993,
 
                                       74
 
<PAGE>
68  bottlers and 12 distributors sold RC  Cola brand products outside the United
States in 53 countries, with international sales in Transition 1993  distributed
among Canada (47%), Latin America and Mexico (11.8%), Europe (21.1%), the Middle
East/Africa  (15.0%)  and the  Far East  (5.1%). Historically,  RC Cola  has had
limited managerial or  financial resources making  it difficult for  RC Cola  to
support  its brands outside  of the United  States. RC Cola  brands have not yet
been distributed in a number of major international markets, including Chile and
Brazil in Latin America, Hong Kong and China in the Far East and Russia, Poland,
Spain and  Portugal  in Europe.  To  support  expansion in  these  markets,  new
managers  have been added for Latin  America and Europe, and outside consultants
hired for the countries of the former Soviet Union. These markets are  currently
targeted for development during 1994.
 
PRODUCT DEVELOPMENT AND RAW MATERIALS
 
     RC  Cola believes that it has a reputation as an industry leader in product
innovation. RC Cola introduced the first  national brand diet cola in 1961.  The
DIET RITE flavors line was introduced in 1988 to complement the cola line and to
target  the non-cola segment of  the market, which has  been growing faster than
the cola segment due to a consumer trend toward lighter beverages.
 
     Flavoring ingredients and  sweeteners for sugar-sweetened  soft drinks  are
generally available on the open market from several sources. However, aspartame,
the  sweetener currently preferred  by consumers of diet  soft drinks, was until
recently subject  to a  patent held  by The  NutraSweet Company,  a division  of
Monsanto  Company.  The  NutraSweet  Company  was  the  only  supply  source for
aspartame in  the  United  States  until December  1992,  when  its  patent  for
aspartame  expired. The price of aspartame declined in 1993. The reduced cost of
aspartame has improved RC Cola's gross margin.
 
                               FAST FOOD (ARBY'S)
 
     Arby's is the world's largest  franchise restaurant system specializing  in
roast  beef sandwiches with  an estimated market  share in 1993  of 65.1% of the
roast beef  sandwich  segment  of  the quick  service  restaurant  category.  In
addition,  the Company believes that Arby's is the 14th largest restaurant chain
in the United States,  based on domestic system-wide  sales. As of December  31,
1993,  Arby's restaurant system  consisted of 2,682  restaurants, of which 2,531
operated within the United States and 151 operated outside the United States. As
of December 31,  1993, Arby's  owned and operated  259 units  and the  remaining
units  were  owned  and  operated  by franchisees.  At  December  31,  1993, all
restaurants outside the  United States were  franchised. System-wide sales  were
approximately  $1.5 billion in Fiscal 1993 and approximately $1.1 billion during
Transition 1993.  For information  with respect  to Arby's  revenues,  operating
profit  and assets for the last  three fiscal years, see 'Consolidated Financial
Statements of Triarc Companies, Inc. and Subsidiaries.'
 
     In addition to its various roast beef sandwiches, Arby's restaurants  offer
a  broad menu of chicken, submarine and other sandwiches and salads. A breakfast
menu, which consists of croissants with a variety of fillings, is also available
at many Arby's restaurants. The typical Arby's restaurant, however, generates  a
substantial amount of its revenues during the lunch hours.
 
     Arby's  revenues are  derived from  three principal  sources: (i)  sales at
company-owned restaurants; (ii)  royalties from franchisees  and (iii)  one-time
franchise  fees from  new franchisees.  During Fiscal  1993 and  Transition 1993
approximately 78% of Arby's  revenues were derived  from sales at  company-owned
restaurants  and  approximately 22%  were derived  from royalties  and franchise
fees.
 
     Donald L.  Pierce joined  Arby's on  May 17,  1993 as  President and  Chief
Executive Officer. Prior to joining Arby's, Mr. Pierce was President of PepsiCo,
Inc.'s  Hot 'n Now hamburger  chain. Mr. Pierce was  President of Kentucky Fried
Chicken --  International  from  1988  to  1990 and  held  a  number  of  senior
management  positions  at  Denny's from  1981  to 1988,  including  President of
Denny's, Inc. from 1987 to 1988. Mr. Pierce has assembled a management team with
substantial industry experience consisting of both existing Arby's employees and
key additions in marketing and finance from outside the Triarc Companies.
 
                                       75
 
<PAGE>
BUSINESS STRATEGY
 
     Despite the lack of a chief executive officer responsible solely for Arby's
business  and  unfocused  advertising  and  marketing  programs  prior  to   the
Reorganization,  Arby's has  maintained consistently  high rankings  in consumer
awareness surveys and  continues to attract  new franchisees to  its system.  In
recent years, however, Arby's opened few company-owned restaurants. As a result,
the  number of restaurants in the Arby's system  has grown at a slower rate than
other leading fast food chains, which have expanded through both internal growth
and acquisitions. In addition, the lack of attention of prior management to  the
operating  standards of both company-owned and franchised restaurants, including
significantly  reduced  capital   available  for  remodeling   certain  of   the
company-owned restaurants, may have resulted in a market perception of declining
quality across the Arby's system.
 
     The  new  operating  management  team  is  developing  a  business strategy
designed to increase the total number of restaurants in the Arby's system and to
improve the revenues and profitability of  the restaurants. The key elements  of
this business strategy include:
 
       Accelerated  Store Opening  Program: Due  to capital  constraints, Arby's
       opened only five company-owned restaurants during Transition 1993.  Since
       the Reorganization, Arby's has expanded its management team to support an
       accelerated   program   of   opening   company-owned   stores,  including
       professionals  in   charge  of   site  analysis   and  selection,   lease
       negotiation,  and personnel training. Arby's intends to open 20 to 30 new
       company-owned restaurants in 1994, and 50 to 60 new restaurants in  1995.
       From  time  to  time,  Arby's  will  consider  increasing  the  number of
       company-owned  restaurants   by  acquiring   restaurants  from   existing
       franchisees.  For example, in February 1994, Arby's sold 20 company-owned
       restaurants to a current franchisee and agreed to purchase from the  same
       franchisee  an  aggregate of  33 of  its franchised  restaurants, thereby
       increasing Arby's  overall number  of  company-owned restaurants  by  13.
       Through  new store openings  and the purchase  of franchised restaurants,
       management  intends   to  increase   the  percentage   of   company-owned
       restaurants in the system to 20% over a three to five year period.
 

       Remodeling  Program: The  average company-owned  restaurant has  not been
       renovated or remodeled in approximately 11 years. Based on the historical
       experience  of   Arby's   franchisees,   restaurants   generally   record
       double-digit  increases in sales  in the year  after a remodeling. Arby's
       expects  to  renovate  or   remodel  approximately  70   to  80  of   its
       company-owned  restaurants per  year for  each of  the next  three years.
       Certain of the restaurants to be renovated or remodeled were acquired  by
       Arby's from franchisees.

 

       Expanding  the Franchise  Network: Arby's  management believes  that more
       effective marketing and advertising, a  stronger commitment by Arby's  to
       building  the system through  its accelerated store  opening program, and
       the improvement in  the quality  of the facilities  of the  company-owned
       restaurants   will  increase  the  value   of,  and  demand  for,  Arby's
       franchises.  As  of  December  31,  1993,  Arby's  had  received  prepaid
       commitments  for  the  opening  of  up  to  402  new  domestic franchised
       restaurants over  the  next  five years.  Management  believes  that  its
       efforts  to improve the value of the  Arby's franchise should result in a
       significantly higher number of openings during this time period.

 
       Increasing  Operating   Efficiency:  Arby's   management  believes   that
       significant  additional  operating  efficiency  can  be  achieved  by (i)
       rigorously evaluating the  performance of  company-owned restaurants  and
       closing  those  that do  not meet  selected profitability  criteria, (ii)
       requiring more  uniformity  across  its  restaurant  system  to  increase
       purchasing  efficiencies and improve ease and speed of service, and (iii)
       installing point-of-sale systems, certain new kitchen equipment and other
       labor-saving processes in  company-owned restaurants.  Arby's closed  six
       company-owned  restaurants during  Transition 1993  and expects  to close
       three  additional  company-owned  restaurants   in  1994.  In   addition,
       management anticipates that it will spend approximately $7 to $10 million
       in  1994  on new  equipment, including  point-of-sale terminals,  for the
       company-owned restaurants.
 
       More Focused Retail-Oriented Marketing:  Arby's management believes  that
       focused  advertising  and marketing,  combined  with renewed  emphasis on
       customer service,  will increase  consumer awareness  of Arby's,  improve
       customer    satisfaction    and   stimulate    repeat    visits.   Arby's
 
                                       76
 
<PAGE>
       management believes that Arby's historically has over-emphasized the  use
       of  coupons and other promotional efforts, rather than marketing programs
       that reinforce consumer recognition of Arby's.
 

       International  Expansion:  Although  Arby's  is  initially  focusing  its
       resources  on expanding the domestic restaurant system, Arby's management
       believes that  the international  network represents  a significant  long
       term  growth opportunity. Other than  Canada (103 restaurants) and Mexico
       (15 restaurants), no foreign country had more than two Arby's restaurants
       as of December 31, 1993. Arby's intends to expand the system outside  the
       United  States by opening its first foreign company-owned restaurants and
       granting direct  franchises  in  several new  international  markets.  In
       addition,  management  expects  increases in  the  number  of restaurants
       opened  under   existing   territorial  agreements   with   international
       franchisees in 33 countries. As of December 31, 1993, Arby's had received
       prepaid  commitments for  the opening of  approximately 450 international
       restaurants over the next seven years.

 
       Acquisitions: In addition  to purchasing  franchised restaurants,  Arby's
       intends  to increase the  geographic coverage of  its system by acquiring
       small regional  restaurant  chains  and  converting  the  newly  acquired
       locations into Arby's restaurants.
 
INDUSTRY
 

     The  U.S.  restaurant  industry is  highly  fragmented,  with approximately
400,000 units nationwide. Industry surveys  indicate that the 15 largest  chains
accounted  for approximately 17% of  all units and 29%  of all industry sales in
1993. According to data compiled  by the National Restaurant Association,  total
domestic  restaurant industry sales were approximately  $193 billion in 1993, of
which approximately $80 billion were in  the quick service ('QSR') or fast  food
segment.  In recent years the industry has benefitted as spending in restaurants
has consistently  increased  as a  percentage  of total  food-related  spending.
According  to a  Standard & Poor's  Corporation report dated  November 1992 (its
most recent report on the subject),  it was estimated that approximately 34%  of
all  domestic retail food sales  in 1992 would be  made in restaurants, compared
with approximately 25% in 1970. According to an industry survey, the QSR segment
has been the fastest  growing segment of the  restaurant industry over the  past
five years, with a compounded annual sales growth rate from 1989 through 1993 of
4.5%.  The recent  recession, however, slowed  the rate of  growth in restaurant
spending.

 
ARBY'S RESTAURANTS
 
     The first  Arby's restaurant  opened in  Youngstown, Ohio  in 1964.  As  of
December  31, 1993, Arby's  restaurants operated in 49  states, Puerto Rico, the
U.S. Virgin Islands  and 14 foreign  countries. At December  31, 1993, the  five
leading  states by number  of operating units were:  Ohio, with 199 restaurants;
California, with 175  restaurants; Texas, with  158 restaurants; Michigan,  with
141  restaurants;  and Georgia,  with 126  restaurants.  Other than  Canada (103
restaurants) and Mexico  (15 restaurants), as  of December 31,  1993 no  foreign
country had more than two Arby's restaurants.
 
     The  typical company-owned Arby's restaurant in  the United States is 2,570
square feet, including approximately 1,100 square feet devoted to seating space,
approximately 100 square feet  to selling space  and approximately 1,370  square
feet  to  kitchen  operations  and storage.  Stores  typically  have  a manager,
assistant manager  and as  many as  20 full  and part-time  employees.  Staffing
levels, which vary during the day, tend to be heaviest during the lunch hours.
 
     The  following table sets forth the  number of company-owned and franchised
Arby's restaurants at December 31, 1991, 1992 and 1993.
 
<TABLE>
<CAPTION>
                                                                        DECEMBER 31,
                                                                   -----------------------
                                                                   1991     1992     1993
                                                                   -----    -----    -----
<S>                                                                <C>      <C>      <C>
Company-owned restaurants.......................................     260      268      259
Franchised restaurants..........................................   2,241    2,335    2,423
                                                                   -----    -----    -----
          Total restaurants.....................................   2,501    2,603    2,682
                                                                   -----    -----    -----
                                                                   -----    -----    -----
</TABLE>
 
                                       77
 
<PAGE>
     Arby's opened only five company-owned restaurants in Transition 1993. Since
the Reorganization,  Arby's  has expanded  its  management team  to  support  an
accelerated  program of opening company-owned stores, including professionals in
charge of site analysis and selection, lease negotiation and personnel training.
Arby's intends to open 20 to 30 new company-owned restaurants in 1994, and 50 to
60 new restaurants in 1995.
 

     Arby's also intends to  undertake a program to  upgrade the quality of  the
facilities  of its  company-owned restaurants. The  average Arby's company-owned
restaurant has not been  renovated or remodeled in  approximately 11 years.  The
average  cost of renovating a restaurant is  $70,000, which includes the cost of
new signage, menu boards, seating areas, kitchens and point-of-sale systems.  In
addition,  Arby's management intends to add  drive-through windows in several of
its  company-owned  restaurants.  At   December  31,  1993,  approximately   200
company-owned  restaurants  had drive-through  facilities.  The average  cost of
adding a drive-through window in a restaurant is $50,000.

 
     In Fiscal 1991, Arby's  purchased 22 poorly  performing restaurants from  a
franchisee,  substantially  all  of  which  have  been  included  in  the Arby's
remodeling  program.  Arby's  management  believes  that  the  acquisition   and
remodeling  of poorly  performing franchised  restaurants will  enable Arby's to
improve the overall quality of the facilities in the Arby's system.
 
     In February 1994, Arby's sold 20 company-owned restaurants in the  Atlanta,
Georgia  and  Portland, Oregon  markets to  a current  franchisee and  agreed to
purchase from  the  same  franchisee  an  aggregate  of  33  of  its  franchised
restaurants in the Jacksonville, Florida and Orlando, Florida markets. Following
the  acquisition of the Florida restaurants by Arby's, these restaurants will be
remodeled and renovated. The acquisition of the Florida restaurants is part of a
plan to increase Arby's  market presence in  Florida, Arby's headquarter  state,
which,  in  turn, will  allow  Arby's to  test  new products  and  concepts more
effectively.
 
FRANCHISE NETWORK
 
     At December 31, there were  approximately 500 Arby's franchisees  operating
2,423 separate locations. The initial term of the typical franchise agreement is
20  years with a  20-year renewal option  by the franchisee,  subject to certain
conditions. While  Arby's management  is  currently considering  implementing  a
program to provide financing arrangements to its franchisees, as of December 31,
1993, Arby's did not offer any financing arrangements to its franchisees.
 

     The  Arby's  franchise was  ranked by  a  survey published  in Entrepreneur
magazine in January 1994 as  one of the top  20 franchises among 500  franchised
businesses,   based  on  a  variety  of  objective  criteria  of  importance  to
franchisees. As of December  31, 1993, Arby's  had received prepaid  commitments
for  the opening of up to 402  new domestic franchised restaurants over the next
five  years.  Arby's  has  granted  territorial  agreements  with  international
franchisees  in  33 countries,  and  as of  December  31, 1993  received prepaid
commitments for the opening of approximately 450 international restaurants  over
the  next seven years. Under the terms  of these territorial agreements, many of
the  international  franchisees  have  the   exclusive  right  to  open   Arby's
restaurants in specific regions or countries, as well as to sub-franchise Arby's
restaurants.  Management expects that  future international franchise agreements
will more  narrowly limit  the  geographic exclusivity  of the  franchisees  and
prohibit sub-franchise arrangements.

 
     Arby's  offers franchises for  the development of  both single and multiple
restaurant locations. All franchisees are required to execute standard franchise
agreements. Arby's standard U.S. franchise  agreement provides for, among  other
things,  an  initial $37,500  franchise fee  for the  first franchised  unit and
$25,000 for each subsequent unit and a monthly royalty payment based on 3.5%  of
restaurant  sales  for the  first  two years  from the  date  of opening  of the
franchised unit  and 4.0%  during the  remainder of  the term  of the  franchise
agreement.  Franchise agreements effective after February  1, 1994 provide for a
4.0% royalty payment for the entire term of the franchise agreement. As a result
of lower royalty  rates still in  effect under earlier  agreements, the  average
royalty  rate paid  by franchisees  at December  31, 1993  was 2.6%. Franchisees
typically pay  a $10,000  commitment  fee, credited  against the  franchise  fee
referred to above, during the development process for a new restaurant.
 
                                       78
 
<PAGE>
     Franchised  restaurants are  operated in accordance  with uniform operating
standards and specifications relating to the selection, quality and  preparation
of  menu items, signage, decor,  equipment, uniforms, suppliers, maintenance and
cleanliness of  premises  and  customer service.  Arby's  continuously  monitors
franchisee  operations  and  inspects restaurants  periodically  to  ensure that
company practices and  procedures are being  followed. Management believes  that
expanding  the number of the company-owned  stores and up-grading the quality of
the facilities will enhance the value of an Arby's franchise.
 
ADVERTISING AND MARKETING
 
     Arby's management  believes  that  focused advertising  and  marketing  can
increase  consumer awareness of the system and  the quality of its food, service
and facilities.  As  part  of  its business  strategy,  franchisees  and  Arby's
contribute  0.7% of  gross sales  to the  Arby's Franchise  Association ('AFA'),
which  produces  advertising  and  promotion  materials  for  the  system.  Each
franchisee  is also required to spend a  reasonable amount, but not less than 3%
of its monthly gross sales,  for local advertising including their  contribution
to  a  cooperative  area  advertising program  with  other  franchisees  who are
operating Arby's  restaurants  in the  same  area. Arby's  advertises  primarily
through  regional television, radio and newspapers. Payment for advertising time
and space is made by the local franchisee, Arby's or both on a shared basis.  In
Fiscal  1992 and 1993  and Transition 1993,  Arby's expenditures for advertising
and marketing  in support  of  company-owned stores  were $14.4  million,  $16.2
million  and $11.1  million, respectively.  Management believes  that Arby's has
historically over-emphasized the use of  coupons and other promotional  efforts,
rather than marketing programs that reinforce consumer recognition of Arby's.
 
PROVISIONS AND SUPPLIES
 
     Arby's roast beef is provided by four independent meat processors, three of
which have been suppliers to Arby's and its franchisees for more than ten years.
One  of  such  suppliers  (Custom Food  Products,  Best  Western  Food Division)
provides approximately 40%  of the roast  beef requirements for  Arby's and  its
franchisees.  Arby's  other roast  beef  suppliers are  Multi-Foods Corporation,
Prepared  Foods  Division  (28%),  Peck  Foods  Corporation  (16%)  and  Cargill
Processed Meats, Enge Packing Company (16%). Franchise operators are required to
obtain  roast beef from one of the  four suppliers. Arby's, through a non-profit
purchasing cooperative ARCOP,  Inc. ('ARCOP'), which  negotiates contracts  with
approved  suppliers  on  behalf  of Arby's  and  its  franchisees,  is currently
negotiating the renewal of its  'cost-plus' contracts with these suppliers  that
have  expired in August, 1993. While the renewal contracts are being negotiated,
the suppliers continue to provide Arby's  with roast beef pursuant to the  terms
of  the expired contracts. Arby's  believes that satisfactory arrangements could
be made to replace any of its  current roast beef suppliers, if necessary, on  a
timely basis.
 
     Franchisees   may   obtain  other   products,  including   food,  beverage,
ingredients, paper goods, equipment and signs, from any source that meets Arby's
specifications. Food, proprietary  paper and  operating supplies  are also  made
available to Arby's franchisees through ARCOP.
 
QUALITY ASSURANCE AND CUSTOMER SERVICE
 
     Arby's  has developed  a quality assurance  program designed  to (i) ensure
that each franchised unit adheres to Arby's policies, practices and  procedures,
(ii)  maintain uniformity among its franchised restaurants and (iii) ensure that
products it  receives from  its  major suppliers  meet  its high  standards  for
quality.
 
     Arby's  believes that a high level  of customer service results in improved
customer  satisfaction  and,  therefore,  repeat  visits.  Arby's  has  recently
up-graded  its  employee  training programs  for  company-owned  restaurants and
offers similar programs for  franchisees, including refresher courses,  training
videos  and other materials. Management  believes that improved customer service
has been an important  contributing factor in the  11.0% increase in same  store
sales experienced in the twelve months ended December 31, 1993.
 
                                       79
 
<PAGE>
                            TEXTILES (GRANITEVILLE)
 
     Graniteville manufactures, dyes, and finishes cotton, synthetic and blended
(cotton  and  polyester)  apparel  fabrics.  Graniteville  produces  fabrics for
utility wear  including  uniforms  and other  occupational  apparel,  piece-dyed
fabrics  for  sportswear, casual  wear  and outerwear,  indigo-dyed  fabrics for
jeans,  sportswear  and  outerwear  and  specialty  fabrics  for   recreational,
industrial  and  military end-uses.  Through  its wholly-owned  subsidiary, C.H.
Patrick, Graniteville also  produces and  markets dyes  and specialty  chemicals
primarily   to   the  textile   industry.  For   information  with   respect  to
Graniteville's revenues, operating profit and  assets for the last three  fiscal
years,  see  'Consolidated Financial  Statements of  Triarc Companies,  Inc. and
Subsidiaries.'  Triarc  believes  that   Graniteville  is  a  leading   domestic
manufacturer  of fabrics  for utility  wear, piece-dyed  fabrics for sportswear,
casual wear and  outerwear and  indigo-dyed fabrics  used in  the production  of
high-end fashion apparel.
 
     On  April  24,  1993, Harold  D.  Kingsmore,  who had  been  Executive Vice
President and  Chief  Operating  Officer  of  Graniteville  since  1986,  became
President  and Chief Executive  Officer of Graniteville.  Mr. Kingsmore has more
than 30 years of experience in the textile industry, and together with the other
members of  Graniteville's  management  team,  has  been  successfully  managing
Graniteville's business for more than seven years.
 
BUSINESS STRATEGY
 
     Graniteville  believes that it has a  reputation in the textile industry as
both a consistent producer of quality products and an innovator of new  products
to  meet the  changing needs  of its  customers. The  management of Graniteville
intends to continue to implement  the following business strategy, focusing  its
resources  on products and markets where it believes it can obtain a significant
market share. The key elements of the strategy include:
 
       Focus on Innovative,  Value-Added Products:  Graniteville's products  are
       high value-added fabrics that require sophisticated manufacturing, dyeing
       and  finishing techniques. Graniteville maintains its leadership position
       in these products by creating new processes that result in special colors
       or textures in the case  of fashion-oriented fabrics or provide  improved
       performance characteristics in the case of utility wear.
 
       Maintain  Profitability in a Cyclical Industry: Graniteville consistently
       purchases unfinished fabrics (known as 'greige goods') from third parties
       for its finishing plants  to supplement internally manufactured  fabrics.
       This strategy generally allows Graniteville to reduce purchases of greige
       goods  during periods of reduced  demand while continuously operating its
       manufacturing facilities.  This  strategy  also  allows  Graniteville  to
       increase  purchases  during  periods  of  peak  demand.  As  a  result of
       operating its weaving facilities at consistently high utilization  rates,
       cyclical  fluctuations  in  demand  have  less  impact  on Graniteville's
       operating profits  than  on  certain of  its  competitors.  In  addition,
       Graniteville  attempts to minimize its working capital investment through
       inventory controls  while  still  allowing efficient  scheduling  of  its
       manufacturing facilities and achieving on-time deliveries to customers.
 
       Maintain  Quick Response to  Customers: Graniteville believes  that a key
       element of  its success  has  been its  ability  quickly to  develop  and
       produce   innovative,  finished  fabrics  for   customers,  giving  it  a
       competitive advantage over certain other fabric producers. Quick response
       time is  particularly valued  by customers  engaged in  fashion-sensitive
       segments   of  the  apparel  industry.  Graniteville's  modern,  flexible
       production facilities enable it to provide this high value-added  service
       in a cost-effective manner.
 
       Invest  Capital in Modern  Vertically-Integrated Operations: Graniteville
       believes that vertical integration is an essential element of its ability
       to produce  customized  fabrics in  a  quick and  cost-effective  manner.
       Graniteville  has spent  $132 million over  the seven  year period ending
       December 31, 1993 to modernize  its facilities. Management will  continue
       its  facilities and  equipment modernization program  to lower production
       costs while simultaneously maintaining quality standards.
 
       Expand Dyes  and Specialty  Chemicals Business:  Graniteville's dyes  and
       specialty  chemicals  subsidiary,  C.H.  Patrick,  has  experienced 10.5%
       compound annual growth in revenues over the
 
                                       80
 
<PAGE>
       last five years and  is viewed as an  innovator in its field.  Management
       intends  to  continue  to  emphasize the  development  of  C.H. Patrick's
       products and markets.
 
PRODUCTS AND MARKETS
 
     Graniteville's principal products  are cotton and  cotton blended  fabrics,
including denim. Fabric styles are distinguished by weave, weight and finishing.
The  production of fabric is  organized into four product  lines based on fabric
type and end-use -- utility wear, piece-dyed fabrics for sportswear, casual wear
and outerwear,  indigo dyed  fabrics  for jeans,  sportswear and  outerwear  and
specialty  products. In  addition, Graniteville manufactures  dyes and specialty
chemicals through C.H. Patrick. Graniteville  focuses its resources on  products
and  markets where it believes it can obtain a significant market share. In each
of its market  segments, Graniteville focuses  on developing relationships  with
those customers with the greatest need for high value added products.
 
     The  contribution of each product line  and service to Graniteville's total
revenues during Fiscal 1993 and Transition 1993 is set forth below:
 
<TABLE>
<CAPTION>
                                                               PERCENT OF REVENUES
                                                          ------------------------------
                                                          FISCAL 1993    TRANSITION 1993
                                                          -----------    ---------------
<S>                                                       <C>            <C>
Utility wear...........................................        36%              39%
Piece-dyed fabrics for sportswear, casual wear and
  outerwear............................................        26               23
Indigo-dyed fabrics for jeans, sportswear and
  outerwear............................................        21               22
Specialty products.....................................         8                7
Dyes and specialty chemicals...........................         8                8
Other..................................................         1                1
                                                              ---              ---
          Total........................................       100%             100%
                                                              ---              ---
                                                              ---              ---
</TABLE>
 

     Utility Wear: Graniteville believes it  is a leading domestic  manufacturer
of  fabrics  for  sale to  apparel  manufacturers  that supply  utility  wear to
industrial laundries for  rental to  their customers, as  well as  manufacturers
that sell utility wear on the retail market. In the utility wear market, fabrics
are  generally piece-dyed, which means  that the fabric is  first woven and then
dyed. Utility wear customers require a durable fabric which complies with strict
standards for fitness of use and continuity and retention of color. Graniteville
works closely  with its  customers in  order to  develop fabrics  with  enhanced
performance  characteristics. Graniteville's utility  wear customers include Red
Kap, Williamson-Dickie, Cintas, Carhartt, Inc., American Uniform, Washable Inc.,
Walls Industries, Perfect Industrial Uniform, Reed Manufacturing and Unifirst.

 
     Piece-dyed Fabrics for Sportswear, Casual Wear and Outerwear:  Graniteville
believes  it  is  a leading  domestic  manufacturer of  woven  cotton piece-dyed
fabrics that  are sold  primarily  to domestic  manufacturers and  retailers  of
men's, women's and children's sportswear, casual wear and outerwear. Fabrics are
produced  for  customers  in a  wide  variety  of styles,  colors,  textures and
weights, according  to individual  customer specifications.  Graniteville  works
directly  with its customers  to develop innovative  fabric styles and finishes.
Graniteville's piece-dyed  sportswear fabric  customers include  Wrangler,  Polo
Ralph Lauren, The Gap, M&F Girbaud, Levi Strauss (Dockers), Liz Claiborne, Henry
I. Siegel Company, Inc. (H.I.S.), Farah, Sun Apparel and I.C. Isaac's.
 
     Indigo-Dyed   (Denim)   Fabrics  for   Jeans,  Sportswear   and  Outerwear:
Graniteville believes  it  is a  leading  domestic manufacturer  of  indigo-dyed
fabrics (primarily denim) in a wide range of styles for use in the production of
high-end  men's,  women's  and  children's  fashion  apparel.  Graniteville also
produces other indigo-dyed fabrics for  jeans, sportswear and outerwear. In  the
manufacture  of indigo-dyed fabrics, the  yarn is dyed before  it is woven. This
process results in  the distinctive appearance  of indigo-dyed apparel  fabrics,
noted by variations in color. Graniteville is a leader in the development of new
and innovative colors and styles of weaves and finishes for indigo-dyed fabrics,
and  works directly with its customers  to produce indigo-dyed fabrics that meet
the  changing  styles  of   the  contemporary  fashion  market.   Graniteville's
indigo-dyed  fabrics  customers  include  The  Gap,  Guess,  Flynn  Enterprises,
 
                                       81
 
<PAGE>
Wilkins Industries, Stuffed Shirt, Wrangler, Sun Apparel, Levi Strauss, Cherokee
Apparel and Carhartt, Inc.
 
     Specialty  Products:  Graniteville  produces  a  variety  of  fabrics   for
recreational,  industrial and  military end-uses,  including coated  fabrics for
awnings, tents, boat covers and camper fabrics. The specialty products unit also
dyes  customer-owned  finished  garments,  enabling  customers  to  order  color
selections,   while  minimizing  inventory  risk   and  meeting  short  delivery
schedules.
 
C.H. PATRICK PRODUCTS AND MARKETS
 

     C.H.  Patrick  develops,  manufactures  and  markets  dyes  and   specialty
chemicals,  primarily  to the  textile industry.  During  both the  twelve month
period ended February 28,  1993 and the  eight month period  from March 1,  1993
through  October 31,  1993, approximately  57% of  C.H. Patrick's  sales were to
non-affiliated manufacturers, and 43% were to Graniteville. C.H. Patrick's sales
to third parties have increased  at a compounded annual  rate of 10.5% over  the
last  three calendar years. Graniteville management  believes that C. H. Patrick
has earned  a  reputation  for  producing  high  quality,  innovative  dyes  and
specialty chemicals.

 
     C.H.  Patrick processes dye presscakes and other basic materials to produce
and sell indigo,  vat, sulfur  and disperse liquid  dyes, as  well as  disperse,
direct and aluminum powder dyes. The majority of C.H. Patrick's dye products are
used  in  the  continuous dyeing  of  cotton and  polyester/cotton  blends. C.H.
Patrick  also  manufactures  various  textile  softeners,  surfactants,   dyeing
auxiliaries and permanent press resins, as well as several acrylic polymers used
in  textile finishing  as soil release  agents. Most of  C.H. Patrick's products
offer higher margins than other product lines of Graniteville.
 
MARKETING AND SALES
 
     Graniteville's fabric is marketed and  sold by its woven apparel  marketing
group  which will  be moved from  its current  headquarters in New  York City to
Graniteville's headquarters in South Carolina before the end of 1994. The  group
also  maintains  regional sales  offices  in Boston,  Massachusetts; Greensboro,
North Carolina; Greenville,  South Carolina; Dallas,  Texas; and San  Francisco,
California.  Independent sales agents in Los Angeles, California and Canada also
market Graniteville's woven apparel products. Graniteville's specialty  products
are  marketed and sold by the  specialty products division. C.H. Patrick markets
and sells its dyes and chemicals through its own sales and marketing department.
 
MANUFACTURING
 
     Graniteville is  a  vertically  integrated  manufacturer,  with  facilities
capable of converting raw fiber into finished fabrics. Generally, raw fibers are
purchased  and spun  into yarn, and  yarns are  either dyed and  then woven into
fabrics (as in the case of indigo-dyed fabrics) or woven into fabrics, which are
then dyed according to customer specifications. Graniteville currently  operates
four  weaving plants,  two indigo-dyeing facilities,  one piece-dyeing facility,
one coating facility and one garment-dyeing  facility, all of which are  located
within a fifteen mile radius of Graniteville's headquarters.
 
     Graniteville's  piece-dyed dyeing  and finishing facilities  utilize a wide
range of technologies, highlighted by the use of a sophisticated  computer-based
monitoring  and control system.  This system, which  Graniteville believes to be
unique in the industry, allows Graniteville to continuously monitor and  control
each phase of the dyeing and finishing process in order to improve productivity,
efficiency, consistency and quality.
 
     Graniteville invested approximately $132 million over the seven year period
ending   December   31,  1993   to   modernize  its   manufacturing  operations.
Graniteville's yarn spinning and weaving operations were updated by the addition
of  state-of-the-art  computer-controlled  spinning  machinery  and  high  speed
air-jet and rapier looms, capable of significantly increasing productivity while
allowing  Graniteville to maintain its  high quality manufacturing standards. In
1994 Graniteville  expects  to  spend  approximately $20  million  in  order  to
maintain, expand and upgrade its facilities.
 
                                       82
 
<PAGE>
RAW MATERIALS
 
     The  principal raw materials used by Graniteville in the manufacture of its
textile  products  are  cotton   and  man-made  fibers  (primarily   polyester).
Graniteville   seeks  to  enter  into  partnership-type  arrangements  with  its
suppliers. It purchases cotton from a  number of domestic suppliers at the  time
it  receives orders from customers and generally maintains a commitment position
resulting in  a four  to six  month  supply of  cotton. Polyester  is  generally
purchased  from one principal supplier,  although there are numerous alternative
domestic sources  for polyester.  Polyester is  purchased pursuant  to  periodic
negotiations  whereby  Graniteville  seeks  to assure  itself  of  a consistent,
cost-effective supply.  In general,  there is  an adequate  supply of  such  raw
materials  to  satisfy  the needs  of  the industry.  In  addition, Graniteville
purchases greige  goods  from other  manufacturers  to supplement  its  internal
production. These fabrics have normally been available in adequate supplies from
a  number  of  domestic  sources.  Graniteville  also  purchases  bulk  dyes and
specialty chemicals manufactured by  various domestic producers, including  C.H.
Patrick.  While Graniteville believes  that there is  a competitive advantage to
purchasing these  dyes  and specialty  chemicals  from C.H.  Patrick,  they  are
presently available in adequate supply in the open market.
 
BACKLOG
 
     Graniteville's  backlog  of unfulfilled  customer orders  was approximately
$191.2 million at December 31, 1993, as compared to approximately $222.2 million
at December  31, 1992.  It is  expected  that substantially  all of  the  orders
outstanding at December 31, 1993 will be filled during the next 12 months. Order
backlogs are usual to the business in which Graniteville operates.
 
           LIQUEFIED PETROLEUM GAS (NATIONAL PROPANE AND PUBLIC GAS)
 

     National  Propane and its subsidiaries  and Public Gas distribute liquefied
petroleum  gas  ('LP  gas')   for  residential,  agricultural,  commercial   and
industrial  uses,  including space  heating, water  heating, cooking  and engine
fuel. The LP Gas  Companies also sell related  appliances and equipment.  Triarc
believes  that the LP Gas Companies are the fifth largest distributors of LP gas
in terms of  unit volume in  the United States.  As of December  31, 1993,  this
business was conducted by approximately 156 operating units located in 20 states
in  the Southeast, Northeast,  Midwest and Southwest,  primarily in suburban and
rural areas. For information with respect to the revenues, operating profit  and
assets   of  the  LP  Gas  Companies  for  the  last  three  fiscal  years,  see
'Consolidated Financial Statements of Triarc Companies, Inc. and Subsidiaries.'

 
     Ronald D.  Paliughi  joined the  LP  Gas Companies  on  April 24,  1993  as
National  Propane's  President  and  Chief  Executive  Officer.  Previously, Mr.
Paliughi had  been  Senior  Vice  President-Western  Operations  of  AP  Propane
(AmeriGas),  the largest LP  gas company in  the United States,  and director of
retail operations of  CalGas Corporation,  previously a division  of the  fourth
largest  LP gas  company in  the United  States. Mr.  Paliughi has  assembled an
experienced management  team committed  to  implementing the  strategy  outlined
below.
 
BUSINESS STRATEGY
 
     Prior  to the  Reorganization, the  LP Gas Companies  did not  have a chief
executive officer solely responsible for  their business, and were operating  in
their  numerous regions without coordinated  pricing or distribution strategies.
Purchasing  and   other  functions   were  decentralized,   resulting  in   cost
duplications and purchasing inefficiencies.
 
     The  LP Gas Companies' new management  has begun to implement the following
strategies intended to increase revenues and improve operating margins:
 
       Centralization and Streamlining of Operations: Historically, Triarc's  LP
       gas  business was comprised  of seven regionally  branded companies, each
       with its own operating  style and corporate  staff. These seven  regional
       companies  were restructured in July 1993 into a centralized headquarters
       and two  operating  divisions.  Since  the  Reorganization,  the  LP  Gas
       Companies'  work force has been reduced  by approximately ten percent and
       further reductions are planned
 
                                       83
 
<PAGE>
       during calendar  1994. In  addition, better  utilization of  the  vehicle
       fleet  should permit a ten percent reduction in the size of such fleet by
       the end of calendar 1994. As a result, operating expenses are expected to
       decrease significantly in calendar 1994.
 
       Improved Pricing  Management:  To  better  monitor  prices,  the  LP  Gas
       Companies  are in  the process of  installing a  $2.4 million centralized
       pricing and billing  system in  all of  their offices  which will  enable
       management  to  set and  monitor prices  from headquarters.  This system,
       which is expected to  be fully operational in  mid-1994, will permit  the
       monitoring  of supply,  demand and  competitive pricing  information on a
       system-wide basis. The  LP Gas  Companies' management  believes that  the
       timely  availability  of this  information will  lead  to an  increase in
       margins, thereby increasing gross profits.
 
       Improved  Marketing:  The  LP  Gas  Companies  intend  to   differentiate
       themselves  from many smaller, local competitors by establishing an image
       as a large, reliable fuel supplier on which customers can depend. All  of
       the  businesses  will  operate  under  the  National  Propane  brand  and
       operating management will implement coordinated advertising and marketing
       campaigns.
 
       Efficient  Purchasing:  Due  to  capital  constraints  and  the  lack  of
       centralized  purchasing, the LP Gas Companies historically have not taken
       advantage of existing storage capacity. When conditions are  appropriate,
       management  intends  to purchase  and store  LP  gas supplies  during the
       summer months when market pricing is distressed, and sell these  supplies
       during  times  of higher  gas prices.  In addition,  each LP  Gas Company
       historically purchased  LP  Gas  independently.  The  LP  Gas  Companies'
       management  recently  centralized  purchasing  and  hired  an experienced
       senior executive to manage all LP gas purchasing activities.
 
       Acquisitions: To complement  the strategies  outlined above,  the LP  Gas
       Companies   intend  to  increase  revenues  by  acquiring  smaller,  less
       efficient competitors and  incorporating them into  the LP Gas  Companies
       existing   network.  Accordingly,  in  November  1993,  National  Propane
       acquired the  assets  of Ark-La-Tex  LP  Gas, Inc.  and  affiliates  with
       locations  in Texarkana,  Arkansas and  Karnack, Texas.  National Propane
       paid approximately  $1.4  million  for  these  assets,  of  which  amount
       approximately  $0.7  million was  financed by  the  seller. Prior  to its
       acquisition, Ark-La-Tex sold approximately 1.4 million gallons of LP  gas
       per  year. In  addition, in January  1994, National  Propane acquired the
       assets of Ozark Gas Company and affiliates, which sold LP gas and related
       merchandise in West  Plains, Thayer,  and Willow  Springs, Missouri.  The
       purchase  price for these assets was approximately $3.8 million, of which
       approximately $2.7  million was  financed  by the  seller. Prior  to  its
       acquisition,  Ozark  Gas Company  had annual  sales of  approximately 3.7
       million gallons of LP gas.
 
INDUSTRY
 

     LP gas is a clean burning fuel  produced by extraction from natural gas  by
pipeline  and by  separation from  crude oil and  crude oil  products. In recent
years, industry sales of LP  gas have not grown,  primarily due to the  economic
downturn  and  energy conservation  trends, which  have negatively  impacted the
demand for energy by both residential and commercial customers. However, LP Gas,
relative to  other forms  of  energy, is  gaining  increased recognition  as  an
environmentally  superior, safe,  convenient, efficient  and easy  to use energy
source in many applications.

 
MARKETS; CUSTOMERS
 
     LP gas is  sold primarily in  suburban and  rural areas which  do not  have
access  to natural  gas. In  the residential market,  LP gas  is used  in LP gas
appliances and heaters in  a manner similar to  natural gas, primarily for  home
heating,  water heating  and cooking (indoor  and outdoor).  In the agricultural
market, LP  gas is  used primarily  for motor  fuel, chicken  brooders and  crop
drying.  In the commercial market, LP gas is used primarily by restaurants, fast
foods franchises, shopping centers and  other retail or service  establishments.
In  the industrial  market, LP  gas is used  primarily as  a fuel  for fork lift
trucks and delivery trucks, heat-treating and other industrial applications.
 
     During  Fiscal  1993  and  Transition  1993,  approximately  68%  and  53%,
respectively, of sales by the LP Gas Companies were to residential customers and
approximately 32% and 47%, respectively, of
 
                                       84
 
<PAGE>
such  sales were to commercial, agricultural and industrial customers. In Fiscal
1993 and Transition 1993, no single customer accounted for more than 10% of  the
LP Gas Companies' combined operating revenues.
 
PRODUCTS AND SERVICES
 
     LP  gas is sold and  distributed in bulk or  in portable cylinders, through
company-owned retail outlets  and distributors.  Most of the  LP Gas  Companies'
volume, in terms of dollars and gallons, is distributed in bulk, although almost
half of their customers are served using interchangeable portable cylinders. For
customers  served using  cylinders, normally two  LP gas cylinders  of 100 pound
capacity (23.5 gallons each) are installed on the customer's premises along with
necessary regulating and protective equipment. Regular bulk deliveries of LP gas
are made to  customers whose consumption  is sufficiently high  to warrant  this
type  of service. For such customers, tanks  (usually having a capacity of 50 to
1,000 gallons) are installed at the customers' premises and the LP gas is stored
in the tanks under pressure and piped into the premises.
 
     The LP Gas Companies' sales by cylinder and bulk service for the last three
fiscal years and Transition 1993 are as follows:
 
<TABLE>
<CAPTION>
                                                                   CYLINDER
                                                                    TOTAL      BULK TOTAL    COMBINED TOTAL
                                                                   --------    ----------    --------------
                                                                            (GALLONS IN THOUSANDS)
<S>                                                                <C>         <C>           <C>
Fiscal 1991.....................................................    14,480       129,937         144,417
Fiscal 1992.....................................................    13,634       132,074         145,708
Fiscal 1993.....................................................    13,963       140,876         154,839
Transition 1993.................................................     9,687        80,493          90,180
</TABLE>
 

     Year-to-year demand for LP gas is affected by the relative severity of  the
winter  and other climatic conditions. For example, while the severe flooding in
the mid-west United States during the  summer of 1993 has significantly  reduced
the  demand  for  LP  gas for  crop-drying  applications  in  these agricultural
regions, the ice,  snow and  frigid temperatures  that were  experienced by  the
United  States  in  January and  February  of 1994  significantly  increased the
overall demand for LP gas.

 
     The LP Gas Companies also provide  specialized equipment for the use of  LP
gas.  In the residential market, the  LP Gas Companies sell household appliances
such as  cooking ranges,  water  heaters, space  heaters, central  furnaces  and
clothes  dryers. In the  industrial market, the  LP Gas Companies  sell or lease
specialized equipment for the use  of LP gas as fork  lift truck fuel, in  metal
cutting  and atmospheric furnaces and for  portable heating for construction. In
the agricultural market, specialized equipment is leased or sold for the use  of
LP gas as engine fuel and for chicken brooding and crop drying.
 
SUPPLY
 
     The  profitability of the LP Gas Companies  is dependent upon the price and
availability of LP gas as well  as seasonal and climatic factors. Contracts  for
LP  gas are typically made on a year-to-year  basis, but the price of the LP gas
to be  delivered depends  upon market  conditions at  the time  of delivery.  By
acquiring  the ability  to store LP  gas, the LP  Gas Companies will  be able to
lower their annual cost  of goods sold by  maximizing supplies purchased  during
the  low season and minimizing purchases during times of seasonally high prices.
The LP  Gas  Companies  are not  party  to  any contracts  to  purchase  LP  gas
containing  'take  or pay'  provisions. Certain  contracts do,  however, specify
certain minimum  and maximum  amounts of  LP gas  to be  purchased. The  LP  Gas
Companies  purchase LP  gas from numerous  suppliers. The LP  Gas Companies have
experienced conditions of limited supply availability from time to time but have
generally been able to secure sufficient LP gas to meet their customers'  needs.
The  primary sources of supply of LP gas are major oil companies and independent
producers of  both gas  liquids  and oil.  Worldwide  availability of  both  gas
liquids  and oil affects the supply of LP gas in domestic markets, and from time
to time the ability to  obtain LP gas at attractive  prices may be limited as  a
result  of market conditions, thus affecting price levels to all distributors of
LP gas.
 
                                       85
 
<PAGE>
GENERAL
 
TRADEMARKS
 
     Arby's is the  sole owner  of the ARBY'S  trademark and  considers it,  and
certain  other  trademarks owned  by  Arby's, to  be  material to  its business.
Pursuant to  its  standard  franchise  agreement,  Arby's  grants  each  of  its
franchisees the right to use Arby's trademarks, service marks and trade names in
the manner specified therein.
 
     RC  Cola considers its  concentrate formulae, which are  not the subject of
any patents, to be trade  secrets. In addition, RC  COLA, DIET RC, ROYAL  CROWN,
DIET  RITE, NEHI, UPPER 10  and KICK are registered  as trademarks in the United
States, Canada  and a  number of  other countries.  RC Cola  believes that  such
trademarks are material to its business.
 
     RC  Cola and Arby's  material trademarks are registered  in the U.S. Patent
and Trademark  Office and  various  foreign jurisdictions.  RC Cola  and  Arby's
rights to such trademarks in the United States will last indefinitely so long as
they  continue to use  and police the  trademarks and to  renew filings with the
applicable governmental offices. No  challenges to RC Cola  and Arby's right  to
use the ARBY'S, RC COLA, DIET RC, ROYAL CROWN, DIET RITE, NEHI, UPPER 10 or KICK
trademarks in the United States have arisen.
 
COMPETITION
 
     The  Triarc Companies' four  core businesses operate  in highly competitive
industries. Many of the major competitors in these industries have substantially
greater financial, marketing, personnel and other resources than does the Triarc
Companies.
 
     Arby's faces direct and indirect competition from numerous well established
competitors, including  national and  regional fast  food chains.  In  addition,
Arby's  competes  with locally  owned restaurants,  drive-ins, diners  and other
establishments. Key competitive  factors in  the fast food  industry are  price,
quality   of  products,  quality   and  speed  of   service,  advertising,  name
identification, restaurant location and attractiveness of facilities.
 
     RC  Cola's  soft   drink  products  compete   generally  with  all   liquid
refreshments  and in particular with  numerous nationally-known soft drinks such
as Coca-Cola and Pepsi-Cola. RC Cola competes with other beverage companies  not
only  for consumer acceptance but also for shelf space in retail outlets and for
marketing focus by RC Cola's distributors,  most of which also distribute  other
beverage brands. The principal methods of competition in the soft drink industry
include  product  quality  and  taste,  brand  advertising,  trade  and consumer
promotions, pricing, packaging and the development of new products.
 
     In recent  years,  both  the  soft drink  and  fast  food  businesses  have
experienced   increased  price   competition  resulting   in  significant  price
discounting throughout these industries.  Price competition has been  especially
intense  with respect to sales of soft drink products in food stores, with local
bottlers granting significant discounts and  allowances off wholesale prices  in
order  to maintain  or increase  market share  in the  food store  segment. When
instituting its own  discount promotions,  Arby's has  experienced increases  in
sales  but,  with respect  to company-owned  restaurant operations,  lower gross
margins. While the net impact  of price discounting in  the soft drink and  fast
food  industries  cannot be  quantified, such  practices  could have  an adverse
impact on the Triarc Companies.
 
     Graniteville has  many  domestic competitors,  including  large  integrated
textile  companies and  smaller concerns.  No single  manufacturer dominates the
industry or  any  particular  line in  which  Graniteville's  participates.  The
principal elements of competition include quality, price and service.
 
     The   Triarc  Companies'  textile   business  has  experienced  significant
competition from  manufacturers  located  outside  of  the  Untied  States  that
generally  have  access  to less  expensive  labor  and, in  certain  cases, raw
materials. Graniteville  has  attempted to  counteract  the negative  impact  of
competition  from imports by focusing on product lines (for example, denim) that
are less vulnerable  to import  penetration, and  by emphasizing  Graniteville's
location  in the United States, its efficient production techniques and its high
level of customer service which allow  it to provide more timely deliveries  and
to  respond more quickly to changes in its customers' fabric needs. NAFTA, which
became effective on
 
                                       86
 
<PAGE>
January 1, 1994, immediately  eliminated quantitative restrictions on  qualified
imports  of  textiles between  the  United States,  Mexico  and Canada  and will
gradually eliminate tariffs on such imports over a ten-year period. In addition,
a tentative agreement reached  on December 15, 1993  under GATT would  eliminate
quantitative restrictions on imports of textiles and apparel between GATT member
countries over a ten-year transition period. Any significant reduction in import
protection  for domestic textile manufacturers could materially adversely affect
Graniteville's business.
 
     The LP Gas Companies  compete in each LP  gas marketing area with  numerous
other LP gas distributors, none of which, including the LP Gas Companies, can be
considered  dominant in any particular marketing area. The principal competitive
factors affecting this industry  are price and service.  In addition, LP gas  is
sold  in  competition with  all other  commonly used  fuels and  energy sources,
including electricity, fuel oil  and natural gas.  The primary competing  energy
source  to LP gas is electricity, which is available in substantially all of the
market areas served by the LP Gas Companies. Currently, LP Gas is generally less
expensive than electricity based on equivalent energy value. Fuel oil is a major
competitor for home  heating and  other purposes and  is sold  by a  diversified
group  of  companies  throughout  the  marketing  areas  served  by  the  LP Gas
Companies. Except for various industrial applications, no attempt has been  made
to  compete  with  natural gas  which,  with  few exceptions,  has  been  a less
expensive energy source than LP gas. Although competitive fuels may at times  be
less  costly for  an equivalent energy  value, historically LP  gas has competed
successfully on the basis of cleanliness, convenience, safety, availability  and
efficiency.  In addition,  the use  of alternative  fuels, including  LP gas, is
mandated in  certain specified  areas of  the  United States  that do  not  meet
federal air quality standards.
 
WORKING CAPITAL
 
     Arby's and RC Cola's working capital requirements are generally met through
cash flow from operations.
 
     Working  capital  requirements  for  the  textile  business  are  generally
fulfilled  from  operating  cash  flow   supplemented  by  advances  under   the
Graniteville Credit Facility. Trade receivables are generally due in 60 days, in
accordance with industry practice.
 
     Working  capital requirements for the LP Gas Companies fluctuate due to the
seasonal nature  of  their  businesses.  Typically, in  late  summer  and  fall,
inventories  are built up in anticipation of the heating season and are depleted
over the winter months. During the  spring and early summer, inventories are  at
low  levels due to lower demand.  Accounts receivable reach their highest levels
in the middle of the  winter and are gradually reduced  as the volume of LP  gas
sold  declines during  the spring and  summer. Working  capital requirements are
generally met through cash flow from operations. Accounts receivables of the  LP
Gas Companies are generally due within 30 days of delivery.
 
GOVERNMENTAL REGULATIONS
 
     Each  of the Triarc Companies'  core businesses is subject  to a variety of
federal, state and local laws, rules and regulations.
 
     Arby's is subject to regulation by  the Federal Trade Commission and  state
laws  governing the offer and sale of  franchises and the substantive aspects of
the franchisor-franchisee relationship.  In addition, Arby's  is subject to  the
Fair  Labor  Standards Act  and  various state  laws  governing such  matters as
minimum wages, overtime and other working conditions. Significant numbers of the
food service personnel at  Arby's restaurants are paid  at rates related to  the
federal  and state minimum wage, and increases in the minimum wage may therefore
materially increase the labor costs of Arby's and its franchisees. From time  to
time,  Arby's has  received inquiries from  federal, state  and local regulatory
agencies or has been named as  a party to administrative proceedings brought  by
such  regulatory agencies.  Arby's does not  believe that any  such inquiries or
proceedings will have a material adverse effect on Arby's financial condition or
results of operations.
 
     The production and marketing of RC Cola beverages are subject to the  rules
and  regulations of various federal, state  and local health agencies, including
the United  States  Food and  Drug  Administration  (the 'FDA').  The  FDA  also
regulates the labeling of RC Cola products. New FDA
 
                                       87
 
<PAGE>
labeling  regulations will take effect in 1994. RC Cola estimates that the total
costs of complying with the new regulations, primarily for tooling new container
labels, will be approximately $1.5 million.
 
     Graniteville's operations are governed by laws and regulations relating  to
workplace safety and worker health, primarily the Occupational Safety and Health
Act  ('OSHA') and  the regulations  promulgated thereunder.  Revised cotton dust
standards, which  became  effective in  1986,  have required  increased  capital
expenditures, and may require additional capital expenditures presently expected
to range from $7 million to $9 million.
 
     The  LP Gas Companies are subject to  various Federal, state and local laws
and regulations governing  the transportation,  storage and  distribution of  LP
gas,  and the health and  safety of workers, primarily  OSHA and the regulations
promulgated thereunder.
 
     Except as described above, Triarc is  not aware of any pending  legislation
that  in its view is  likely to affect significantly  the operations of Triarc's
subsidiaries. Triarc believes  that the  operations of  its subsidiaries  comply
substantially with all applicable governmental rules and regulations.
 
ENVIRONMENTAL MATTERS
 
     Certain  of the Triarc Companies' operations  are subject to federal, state
and local environmental laws and regulations concerning the discharge,  storage,
handling   and  disposal  of  hazardous  or  toxic  substances.  Such  laws  and
regulations provide for significant fines, penalties and liabilities, in certain
cases without regard to whether the owner  or operator of the property knew  of,
or  was responsible  for, the  release or  presence of  such hazardous  or toxic
substances. In  addition,  third  parties  may make  claims  against  owners  or
operators  of properties  for personal  injuries and  property damage associated
with releases  of hazardous  or  toxic substances.  Triarc cannot  predict  what
environmental  legislation or regulations  will be enacted in  the future or how
existing or  future laws  or regulations  will be  administered or  interpreted.
Triarc cannot predict the amount of future expenditures which may be required in
order  to comply with  any environmental laws  or regulations or  to satisfy any
such claims. Triarc believes that  its operations comply substantially with  all
applicable environmental laws and regulations.
 
     In  1987, Graniteville  was notified  by the  South Carolina  Department of
Health and  Environmental  Control  (the  'DHEC')  that  it  discovered  certain
contamination  of  Langley  Pond  near  Graniteville,  South  Carolina  and DHEC
asserted that  Graniteville may  be  one of  the  parties responsible  for  such
contamination.  Graniteville  entered into  a consent  decree providing  for the
study and investigation  of the  alleged pollution  and its  sources. The  study
report,  prepared by Graniteville's environmental consulting firm and filed with
DHEC on April 23, 1990, recommended that pond sediments be left undisturbed  and
in  place.  DHEC responded  by  requesting that  Graniteville  submit additional
information concerning potential passive and active remedial alternatives,  with
accompanying  supportive  information. In  May  1991 Graniteville  provided this
information to DHEC in a report  of its environmental consulting firm. The  1990
and 1991 reports concluded that pond sediments should be left undisturbed and in
place  and that other  less passive remediation  alternatives either provided no
significant additional benefits or themselves involved adverse effects on  human
health, to existing recreational uses or to the existing biological communities.
Graniteville  management is unable to predict at this time what further actions,
if any, may be required in connection with Langley Pond or what the cost thereof
may be. However,  given the  passage of  time since  the submission  of the  two
reports by Graniteville's environmental consulting firm without any objection or
adverse comment on such reports by DHEC and the absence of desirable remediation
alternatives, other than continuing to leave the Langley Pond sediments in place
and  undisturbed  as  described in  the  reports, management  believes  that the
ultimate outcome of this matter will not have any material adverse effect on the
Triarc Companies' consolidated results of operations or financial condition. See
'TRIARC MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND  RESULTS
OF OPERATIONS -- Liquidity and Capital Resources.'
 
     As a result of certain environmental audits in 1991, SEPSCO became aware of
possible  contamination by hydrocarbons and metals  at certain sites of SEPSCO's
refrigeration operations  and has  filed  appropriate notifications  with  state
environmental authorities and has begun a study of
 
                                       88
 
<PAGE>

remediation  at such sites.  SEPSCO has removed  certain underground storage and
other tanks  at  certain facilities  of  its refrigeration  operations  and  has
engaged  in  certain  remediation  in  connection  therewith.  Such  removal and
environmental remediation involved a variety  of remediation actions at  various
facilities  of SEPSCO  located in  a number  of jurisdictions.  Such remediation
varied from  site to  site, ranging  from testing  of soil  and groundwater  for
contamination, development of remediation plans and removal in certain instances
of  certain contaminated  soils. Remediation has  recently been  completed or is
ongoing and/or known to be required at two sites in Miami, Florida, one site  in
Marathon, Florida, one site in Willard, Ohio, and one site in Provo, Utah. Based
on  preliminary  information and  consultations  with, and  certain  reports of,
environmental consultants and  others, SEPSCO  presently estimates  the cost  of
such  remediation and/or  removal will approximate  $3.7 million,  in respect of
which charges of $1.3 million, $0.2  million and $2.2 million were made  against
earnings  in SEPSCO's fiscal  years ending February 28,  1991, February 29, 1992
and February  28,  1993,  respectively.  In  connection  therewith,  SEPSCO  has
incurred  actual costs through  December 31, 1993  of approximately $1.1 million
and has a remaining accrual of approximately $2.6 million. Triarc believes  that
after such accrual, the ultimate outcome of this matter will not have a material
adverse  effect  on  Triarc  Companies' consolidated  results  of  operations or
financial  condition.  See  'TRIARC  MANAGEMENT'S  DISCUSSION  AND  ANALYSIS  OF
FINANCIAL   CONDITION  AND  RESULTS  OF  OPERATIONS  --  Liquidity  and  Capital
Resources.' If the sale of the Ice Business contemplated by the Letter of Intent
is completed, Southwestern Ice will assume  liability for up to $1.0 million  of
remaining  remediation expenses relating to the  Ice Business assets to be sold,
with SEPSCO  remaining  liable  for  remediation expenses  not  so  assumed.  No
assurance  can be given  that the sale  of the Ice  Business to Southwestern Ice
under the terms contemplated  by the Letter of  Intent will be consummated.  See
'BUSINESS OF SEPSCO -- Recent Transactions.'

 
SEASONALITY
 
     Of  the Triarc Companies' four  core businesses, the soft  drink and LP Gas
businesses are seasonal.  In the soft  drink business, the  highest sales  occur
during  spring  and  summer.  LP  Gas operations  are  subject  to  the seasonal
influences of weather  which vary by  region. Generally, the  demand for LP  Gas
during  the winter months, November through April, is substantially greater than
during the  summer  months at  both  the retail  and  wholesale levels,  and  is
significantly affected by climatic variations. Because of the different seasonal
patterns  of these two businesses,  the Triarc Companies' consolidated financial
results are not materially affected by seasonal factors.
 
DISCONTINUED AND OTHER OPERATIONS
 
     The Triarc  Companies are  engaged  in a  variety of  non-core  businesses.
Consistent  with  Triarc's  strategy  of focusing  resources  on  the  four core
businesses, Chesapeake  Insurance Company  Limited ('Chesapeake  Insurance'),  a
direct  subsidiary of CFC  Holdings, ceased writing  insurance or reinsurance of
any kind for periods commencing on or after October 1, 1993. In addition, Triarc
and SEPSCO have agreed in principle to the sale by SEPSCO to Triarc of the stock
of the SEPSCO subsidiaries  that hold SEPSCO's natural  gas and oil working  and
royalty  interests.  Also, Triarc  has indicated  that  following the  Merger it
intends to (i) cause SEPSCO,  to transfer the LP gas  business of Public Gas  to
National  Propane,  see  'SPECIAL FACTORS  --  Conduct  of the  Business  of the
Surviving  Corporation  after   the  Merger,'   and  (ii)   sell  or   liquidate
substantially  all of the remaining non-core businesses. Given Triarc's focus on
its four core  businesses, Triarc may  sell the natural  gas and oil  businesses
that Triarc has agreed in principle to purchase from SEPSCO. No assurance can be
given as to the time frame within which such businesses may be sold. These sales
or  liquidations  will  not have  a  material  impact on  the  Triarc Companies'
consolidated financial condition or results of operations. The precise timetable
for the sale  or liquidation of  the remaining non-core  businesses will  depend
upon  Triarc's  ability  to  identify appropriate  purchasers  and  to negotiate
acceptable terms for the sale of such businesses.
 
     Insurance  Operations.  Historically,  Chesapeake  Insurance  (i)  provided
certain  property insurance coverage for the Triarc Companies and certain of its
former affiliates; (ii) reinsured a portion of certain insurance coverage  which
the  Triarc Companies  and such  former affiliates  maintained with unaffiliated
insurance  companies  (principally  workers'  compensation,  general  liability,
automobile liability and
 
                                       89
 
<PAGE>
group  life); and (iii) reinsured insurance  risks of unaffiliated third parties
through  various  group  participations.  Chesapeake  Insurance  ceased  writing
reinsurance of risks of unaffiliated third parties during Fiscal 1992 and ceased
writing insurance or reinsurance of any kind effective in October 1993.
 

     In  March 1994, Chesapeake Insurance consummated an agreement with AIG Risk
Management, Inc.  ('AIG') concerning  the commutation  to AIG  of all  insurance
previously  underwritten by AIG on behalf of the Triarc Companies and affiliated
companies for  the years  1977 -  1993, which  insurance had  been reinsured  by
Chesapeake  Insurance.  In connection  with  such commutation,  AIG  received an
aggregate of  approximately $63.5  million,  consisting of  approximately  $29.3
million  of commercial  paper, common stock  and other  marketable securities of
unaffiliated third parties,  and a promissory  note of Triarc  in the  principal
amount of approximately $34.2 million.

 

     In September 1989, the Pennsylvania Insurance Commissioner as rehabilitator
of Mutual Fire, Marine and Inland Insurance Company ('Mutual Fire') commenced an
action  against Chesapeake  Insurance seeking,  among other  things, recovery of
$4.0 million allegedly owed by  Chesapeake Insurance in connection with  certain
reinsurance  arrangements, the issuance  by Chesapeake Insurance  of a letter of
credit in an amount  in excess of $12.0  million, and compensatory and  punitive
damages  in  excess of  $40.0 million.  In  February 1994,  Chesapeake Insurance
entered into  a Settlement  and  Commutation Agreement  with Mutual  Fire  which
provides  for the full settlement  of all claims brought  by Mutual Fire for $12
million. Such agreement  is subject  to approval  of the  Commonwealth Court  of
Pennsylvania. The Triarc Companies has previously recorded charges to operations
in order to fully provide for such settlement.

 
     Chesapeake  Insurance is registered under the Bermuda Insurance Act of 1978
and  related  regulations  which  require  compliance  with  various  provisions
regarding  the  maintenance  of  statutory capital  and  surplus  and liquidity.
Chesapeake Insurance was not in compliance with certain of such provisions as of
December 31, 1992 and expects that it will not be in compliance with certain  of
such  provisions as  of December 31,  1993. However,  since Chesapeake Insurance
ceased writing insurance or reinsurance of any kind for periods commencing on or
after October 1, 1993, any such non-compliance will have no effect on the Triarc
Companies. For additional information with respect to Chesapeake Insurance,  see
'TRIARC  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS.'
 
     Discontinued Operations. In the Consolidated Financial Statements of Triarc
Companies, Inc. and  Subsidiaries, Triarc reports  as 'discontinued  operations'
SEPSCO's  utilities  and  municipal  services  business  segment,  and  SEPSCO's
refrigeration services and products business  segment. SEPSCO recently sold  its
utilities and municipal services business segment in three separate transactions
with  unaffiliated third parties for consideration negotiated on an arms'-length
basis. On  November  12,  1993, SEPSCO  signed  the  Letter of  Intent  to  sell
substantially  all of the  operating assets of the  Ice Business to Southwestern
Ice, an unaffiliated third party for consideration negotiated on an arms'-length
basis. The Letter of Intent, by its terms, expired on January 11, 1994, although
the parties are  still continuing  discussions with respect  to the  transaction
contemplated by the Letter of Intent. Completion of the transaction contemplated
by  the Letter of Intent is subject to a number of significant conditions and no
assurance can be  given that  such transaction  will be  consummated. Triarc  is
continuing  its efforts  to find an  appropriate purchaser for  its Cold Storage
Business.  See  'BUSINESS  OF  SEPSCO  --  Recent  Transactions'  and   'CERTAIN
RELATIONSHIPS AND RELATED TRANSACTIONS -- Certain Other Transactions.'
 
     Other  Operations.  On  January  10, 1994,  Triarc  disposed  of  its 58.6%
interest in Wilson Brothers,  a company engaged in  the specialty decoration  of
glass  and ceramic items  and the design, manufacture  and servicing of overhead
industrial cranes. In February 1994, Triarc  disposed of the assets of its  lamp
manufacturing  and  distribution  business.  Triarc and  SEPSCO  have  agreed in
principle to  the  sale  by  SEPSCO  to  Triarc  of  the  stock  of  the  SEPSCO
subsidiaries  that  hold  SEPSCO's  natural  gas  and  oil  working  and royalty
interests. Such sale will be for a net cash purchase price of $8.5 million, will
be consummated  on or  before  July 22,  1994 and  is  not contingent  upon  the
consummation of the Merger. Triarc Companies continues to own certain grapefruit
groves.
 
                                       90
 
<PAGE>
EMPLOYEES
 

     As   of  December  31,  1993,  Triarc's  four  business  segments  employed
approximately 14,100 personnel, including approximately 2,200 salaried personnel
and approximately  11,900 hourly  personnel. Triarc's  management believes  that
employee  relations are satisfactory. At December 31, 1993, approximately 334 of
the total of Triarc's  employees were covered  by various collective  bargaining
agreements expiring from time to time through 1996.

 
LEGAL PROCEEDINGS
 
     In  December  1990, a  purported  stockholder derivative  suit  was brought
against Triarc and other  defendants on behalf of  SEPSCO. For a description  of
such  legal  proceedings,  see 'SPECIAL  FACTORS  -- Background  to  the Merger;
Reasons for the Merger -- Legal Proceedings Related to SEPSCO and Triarc.'
 
     In April 1993, the United States  District Court for the Northern  District
of  Ohio (the 'Ohio Court'), entered a final order approving a Modification of a
Stipulation of Settlement (the 'Modification') which (i) modified the terms of a
previously approved stipulation of settlement (the 'Original Stipulation') in an
action captioned Granada Investments, Inc. v. DWG Corporation et al., an  action
commenced  in 1989 ('Granada'), and (ii) settled two additional lawsuits pending
before the Ohio Court captioned Brilliant et al. v. DWG Corporation, et al.,  an
action  commenced in July 1992 ('Brilliant'), and DWG Corporation by and through
Irving Cameon et al. v. Victor Posner  et al., an action commenced in June  1992
('Cameon').  Each of  the Granada,  Brilliant and  Cameon cases  were derivative
actions brought against  Triarc and each  of its then  current directors  (other
than  Triarc's  court-appointed directors,  in the  Brilliant and  Cameon cases)
which alleged various instances  of corporate abuse,  waste and self-dealing  by
Victor  Posner, Triarc's then current Chairman  of the Board and Chief Executive
Officer, and certain breaches of fiduciary duties and violations of proxy rules.
The Cameon case was  also brought as  a class action  and included claims  under
RICO and for violating federal securities laws.
 
     The  Modification  continued  the  requirement  contained  in  the Original
Stipulation that the Triarc  Board include three  court appointed directors  and
that  such  directors, along  with two  other directors  who are  neither Triarc
employees nor relatives of Victor Posner, form a special committee of the Triarc
Board (the 'Triarc Special Committee') with authority to review and approve  any
newly  undertaken transaction  between Triarc and  its subsidiaries,  on the one
hand, and entities or persons affiliated  with Victor Posner on the other  hand,
other  than those  transactions specifically  approved in  the Modification. The
Modification specifically permitted  Triarc and/or affiliated  entities to  make
certain  payments of  rent, salary and  expense reimbursements  to Victor Posner
and/or persons or entities related to  or affiliated with him. The  restrictions
contained in the Modification will be binding on Triarc until the earlier of (i)
April 23, 1998, (ii) the date that Victor Posner and certain affiliated entities
certify  to the Ohio Court  (a) that they ceased to  be the beneficial owners of
5.0% or  more of  Triarc's common  stock, or  securities convertible  into  such
shares,  and (b) that  they will not,  directly or indirectly,  exceed such 5.0%
limit prior to April 23, 1998, and (iii) the date that Triarc's common stock  is
no  longer publicly held. See 'MANAGEMENT  OF TRIARC -- Certain Arrangements and
Undertakings Relating to the Composition of the Triarc Board.'
 
     In addition  to the  matters described  immediately above  and the  matters
referred to or described under 'BUSINESS OF TRIARC
COMPANIES  -- General -- Environmental Matters,' Triarc and its subsidiaries are
involved in claims, litigation and administrative proceedings and investigations
of various types in  several jurisdictions. Certain of  these matters relate  to
transactions  involving  companies  which,  prior  to  the  Reorganization, were
affiliates of Triarc and which  subsequent to the Reorganization became  debtors
in bankruptcy proceedings. See 'CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.'
Other  matters  arise in  the  ordinary course  of  the business  of  the Triarc
Companies and it  is the  opinion of  management that  the outcome  of any  such
matter,  or all of them combined, will not have a material adverse effect on the
Triarc Companies' business or consolidated financial condition.
 
                                       91
 
<PAGE>
PROPERTIES
 
     The Triarc  Companies  maintain  a  large  number  of  diverse  properties.
Management  of the Triarc  Companies believes that these  properties, taken as a
whole,  are  generally  well  maintained  and  are  adequate  for  current   and
foreseeable  business needs. The majority of the properties are owned. Except as
set forth below, substantially all of the Triarc Companies' materially important
physical properties are being fully utilized.
 
     Certain information about  the major  plants and  facilities maintained  by
each  of Triarc's four business segments as of December 31, 1993 is set forth in
the following table:
<TABLE>
<CAPTION>
                                                                                                      SQ. FT. OF
                   SEGMENT                              FACILITIES-LOCATION             LAND TITLE    FLOOR SPACE
- ---------------------------------------------  --------------------------------------   -----------   -----------
<S>                                            <C>                                      <C> <C>       <C>
Fast Food....................................  259 Restaurants:                           56   owned      *
                                                    Various locations                    203  leased
                                                    throughout the
                                                    United States
Soft Drink...................................  Concentrate Mfg.:                           1   owned     216,000
                                                    Columbus, GA                           1  leased      25,000
                                                    (including office)                     1  leased      23,000
                                                    La Mirada, CA                          1  leased       5,000
                                                    Cincinnati, OH
                                                    Toronto, Canada
Textiles.....................................  Fabric Mfg.:
                                                    Graniteville, SC                       7   owned   1,877,000
                                                    Augusta, GA                            2   owned     518,000
                                                    Warrenville, SC                        2   owned     208,000
                                               Chemical and Dye Mfg.:
                                                    Greenville, SC                         2   owned     103,000
                                                    Williston, SC                          1   owned      75,000
                                               Office/Warehouse                           16   owned     520,000
LP Gas.......................................  143 Bulk Plants                           201   owned      *
                                               73 Storage Depots                          49  leased
                                               32 Retail Depots
                                               2 Underground storage
 
             INACTIVE FACILITIES
Fast Food....................................  Restaurants                                 1   owned      *
                                                                                           4  leased
Textiles.....................................  Fabric Mfg.                                 3   owned     734,000
</TABLE>
 
- ------------
 
*  While  the  restaurants  in  the  fast  food  segment  range  in  size   from
   approximately   700  square   feet  to   14,000  square   feet,  the  typical
   company-owned Arby's restaurant in the  United States is approximately  2,570
   square  feet. The LP gas facilities  have approximately 34,237,000 gallons of
   storage capacity.
 
   ---------------------------
 
     The fast food segment also owns two and leases eleven land sites for future
restaurants  and  owns  ten  and  leases  nine  restaurants  which  are   sublet
principally  to franchisees. The textiles segment also owns approximately 16,000
acres of  land,  predominantly  woodland,  in  and  around  Graniteville,  South
Carolina,   on  which  it  has  planted  pine  seedlings  and  maintains  forest
conservation practices designed to help protect general water supplies.
 
     Substantially all  of  the properties  used  in the  textiles  segment  are
pledged as collateral for certain debt. All other properties owned by the Triarc
Companies are without significant encumbrances.
 
                                       92
 
<PAGE>
     Certain  information about the materially  important physical properties of
Triarc's discontinued and other operations as of December 31, 1993 is set  forth
in the following table:
 

<TABLE>
<CAPTION>
                                                                                 LAND      SQ. FT. OF
               SEGMENT                          FACILITIES-LOCATION              TITLE     FLOOR SPACE
- -------------------------------------  -------------------------------------   ---------   -----------
<S>                                    <C>                                     <C>         <C>
SEPSCO:
     Refrigeration                     Combination ice mfg. and
                                       cold storage:
                                            Topeka, KS                         1 Owned       266,000
                                            Phoenix, AZ                        1 Owned       147,000
                                            Other locations                    1 Owned        42,000
                                       Cold storage:
                                            Bonner Springs, KS                 1 Owned       919,000
                                            Denver, CO                         1 Owned       202,000
                                            San Martin, CA                     1 Owned       131,000
                                            Santa Maria, CA                    1 Owned       318,000
                                            Portland, OR                       1 Owned       200,000
                                            American Falls, ID                 1 Owned       169,000
                                            Other locations                    3 Owned       166,000
                                       Ice mfg.:
                                            El Centro, CA                      1 Owned       122,000
                                            Other locations                    11 Owned      330,000
                                                                               2 Leased        8,000
     Natural Gas and Oil               Office/warehouse                        4 Owned         6,000
                                                                               6 Leased       10,000
Other Facilities (inactive)
SEPSCO:
          Refrigeration                Ice mfg. and cold storage               3 Owned       189,000
                                       Ice mfg.                                9 Owned       285,000
</TABLE>

 
     The   natural  gas  and  oil  operations  have  net  working  interests  in
approximately 61,000  acres and  net royalty  interests in  approximately  4,000
acres,  located almost entirely  in the states  of Alabama, Kentucky, Louisiana,
Mississippi, North Dakota, Texas and West Virginia. The Triarc Companies' citrus
operations also  own approximately  650  acres of  grapefruit grove  in  Hidalgo
County,  Texas.  The  Triarc  Companies'  lamp  manufacturing  and  distribution
operations, which  were  sold in  February  1994, consisted  of  one  production
facility  with approximately 240,000 total  square feet (including warehouse and
showroom space).
 
                                       93

<PAGE>
                               BUSINESS OF SEPSCO
 
INTRODUCTION
 
     SEPSCO,  directly and through  subsidiaries, is currently  engaged in three
primary businesses: refrigeration; liquefied petroleum  gas and natural gas  and
oil.  These businesses accounted for $59.2 million and $41.9 million in revenues
in Fiscal 1993 and the nine month period ended November 30, 1993,  respectively,
and $65.0 million in net assets as of November 30, 1993.
 

     Pursuant  to the Discontinued Operations Plan, in October 1993, SEPSCO sold
the businesses that  formerly constituted its  utilities and municipal  services
segment  and on November 12, 1993 SEPSCO  and Southwestern Ice signed the Letter
of Intent for  the sale  of the  Ice Business.  See '  -- Recent  Transactions.'
Triarc  and SEPSCO have agreed  in principle to the sale  by SEPSCO to Triarc of
the stock of  the SEPSCO  subsidiaries that hold  SEPSCO's natural  gas and  oil
working  and royalty interests. Such sale will  be for a net cash purchase price
of $8.5 million,  will be  consummated on  or before July  22, 1994  and is  not
contingent  upon the consummation of the  Merger. See 'CERTAIN RELATIONSHIPS AND
RELATED TRANSACTIONS -- Certain Other  Transactions.' Triarc has indicated  that
following  the Merger, in  connection with the  Discontinued Operations Plan, it
intends to  cause  SEPSCO  to  transfer the  liquefied  petroleum  gas  business
conducted  by SEPSCO's Public Gas subsidiary  to National Propane. Assuming that
the Ice Business is sold  to Southwestern Ice as  contemplated by the Letter  of
Intent and the dispositions described in the two immediately preceding sentences
are consummated, the only SEPSCO business remaining to be sold to an independent
third  party  pursuant to  the  Discontinued Operations  Plan  will be  the Cold
Storage Business. No  agreements have been  entered into as  of the date  hereof
with  respect  to  Cold  Storage  Business and  the  precise  timetable  for the
disposition of such business  will depend upon SEPSCO's  ability to identify  an
appropriate  purchaser and negotiate  acceptable terms of  sale. Although SEPSCO
currently anticipates completing  the sale of  that business by  July 31,  1994,
there can be no assurance that SEPSCO will be successful in this regard. Some or
all  of the net proceeds from the sale  by SEPSCO of any such business or assets
may be used to repurchase,  redeem or prepay SEPSCO's outstanding  indebtedness,
including the indebtedness evidenced by the 11 7/8% Debentures.

 
     As  result of the action  taken by the SEPSCO  Board, all of the businesses
historically engaged  in  by  SEPSCO  have  been  reclassified  as  discontinued
operations, and SEPSCO's consolidated financial statements have been restated to
reflect  such reclassification. See Note  6 to Consolidated Financial Statements
of Southeastern Public Service Company and Subsidiaries.
 
     Set forth below is  a brief description of  the businesses in which  SEPSCO
continues  to operate pending the transfer, sale or discontinuance thereof, with
respect to  the refrigeration  services  and products  businesses, the  oil  and
natural  gas businesses  and the  LP gas business.  In view  of the Discontinued
Operations Plan and the Letter of Intent either or both of SEPSCO's Ice Business
and Cold Storage Business may be disposed of by SEPSCO prior to the date of  the
Special Meeting or the Effective Time of the Merger.
 
BUSINESS OVERVIEW
 
                      REFRIGERATION SERVICES AND PRODUCTS
 
     SEPSCO's   refrigeration   business  provides   cold   storage  warehousing
facilities and manufactures and distributes ice. The principal customers of  the
warehousing activities are food distributors and supermarket chains. Ice is sold
to  commercial establishments, produce shippers and distributors, fishing boats,
convenience stores, supermarkets and retail establishments.
 
     SEPSCO's refrigeration  services  and  products are  provided  to  domestic
customers  on a national  basis. SEPSCO also enters  into processing and storage
agreements with certain customers.
 
     The availability of raw materials is not material to the operation of  this
business   segment.  SEPSCO's  refrigeration  business  is  seasonal.  Operating
revenues are lower  during cold weather  when demand declines  for ice and  cold
storage.
 
                                       94
 
<PAGE>
     The  products and services provided by this segment are marketed nationally
in competition  with  three large  national  companies  as well  as  many  local
concerns.  No competitor  is dominant in  the industry,  although several larger
firms have greater resources than  SEPSCO. The principal competitive factors  in
the refrigeration business are price and service.
 

     As a result of certain environmental audits in 1991, SEPSCO became aware of
possible  contamination by hydrocarbons and metals  at certain sites of SEPSCO's
refrigeration operations  and has  filed  appropriate notifications  with  state
environmental  authorities and has  begun a study of  remediation at such sites.
SEPSCO removed certain underground storage and other tanks at certain facilities
of its  refrigeration  operations and  has  engaged in  certain  remediation  in
connection  therewith.  Such removal  and  environmental remediation  involved a
variety of remediation  actions at  various facilities  of SEPSCO  located in  a
number of jurisdictions. Such remediation varied from site to site, ranging from
testing  of soil and  groundwater for contamination,  development of remediation
plans  and  removal  in  certain   instances  of  certain  contaminated   soils.
Remediation  has recently been  completed or is  on-going and/or is  known to be
required at two sites in Miami, Florida, one site in Marathon, Florida, one site
in Willard, Ohio, and one site in Provo, Utah. Based on preliminary  information
and  consultations with, and  certain reports of,  environmental consultants and
others, SEPSCO presently estimates the  cost of such remediation and/or  removal
will approximate $3.7 million, in respect of which charges of $1.3 million, $0.2
million  and $2.2  million were made  against earnings in  SEPSCO's fiscal years
ending February 28, 1991, February 29, 1992 and February 28, 1993, respectively.
In connection therewith, SEPSCO has incurred actual costs of approximately  $1.1
million  through December 31, 1993 and  had a remaining accrual of approximately
$2.6 million at that date.  If the sale of the  Ice Business as contemplated  by
the Letter of Intent is completed, Southwestern Ice will assume liability for up
to  $1.0 million of remaining remediation  expenses relating to the Ice Business
assets to be sold, with SEPSCO remaining liable for remediation expenses not  so
assumed.  No  assurance  can be  given  that the  sale  of the  Ice  Business to
Southwestern Ice under the  terms contemplated by the  Letter of Intent will  be
consummated. See ' -- Recent Transactions.'

 
                        LIQUEFIED PETROLEUM GAS BUSINESS
 
     SEPSCO, through its Public Gas subsidiary, distributes and sells LP gas and
related   appliances  and  equipment  throughout   the  state  of  Florida,  for
residential, agricultural,  commercial  and industrial  uses,  including,  space
heating,  water heating, cooking and  engine fuel. Following the Reorganization,
management of  SEPSCO's LP  gas business  was transferred  to Triarc's  National
Propane   subsidiary.  Triarc  has  indicated   that,  in  connection  with  the
Discontinued Operations Plan, following the  Merger, it intends to cause  SEPSCO
to  transfer Public  Gas' business  to National  Propane. The  precise method by
which such business will be transferred,  however, has not yet been  determined.
Triarc has informed SEPSCO that prior to or in connection with transferring such
business,  it intends to cause Public Gas to become a wholly-owned subsidiary of
SEPSCO. See  'SPECIAL  FACTORS --  Conduct  of  the Business  of  the  Surviving
Corporation  After the Merger.'  For a description of  SEPSCO's LP gas business,
see 'BUSINESS OF TRIARC  COMPANIES -- Business  Segments -- Liquefied  Petroleum
Gas (National Propane and Public Gas).'
 
                         NATURAL GAS AND OIL INTERESTS
 
     SEPSCO  has working and royalty interests  in natural gas and oil producing
properties located almost entirely in  the states of Alabama, Kansas,  Kentucky,
Louisiana, Mississippi, North Dakota, West Virginia and Texas.
 
     SEPSCO  produces most of the natural gas and  all of the oil that it sells.
Natural gas produced by SEPSCO is sold to major marketeers and pipeline systems,
under short  and  long-term contracts.  Oil  production  is sold  to  crude  oil
refiners.  The business is  not dependent upon  a single customer.  SEPSCO has a
very minor position in the natural gas  and oil industry and competes with  many
larger  independent natural gas and oil producers  as well as with the major oil
companies. This industry is not subject to seasonal factors.
 
                                       95
 
<PAGE>
     Triarc and SEPSCO have agreed in principle to the sale by SEPSCO to  Triarc
of  the stock of the SEPSCO subsidiaries  that hold SEPSCO's natural gas and oil
working and royalty interests. Such sale will  be for a net cash purchase  price
of  $8.5 million,  will be  consummated on or  before July  22, 1994  and is not
contingent upon the consummation of the Merger.
 
OTHER INVESTMENTS
 
GRANITEVILLE
 
     SEPSCO owns  49%  of the  outstanding  common stock  of  Graniteville,  the
remaining  51% of which is owned by  a wholly-owned subsidiary of Triarc. SEPSCO
accounts for  its  investment  in  Graniteville on  the  equity  method.  For  a
description   of  the  business   of  Graniteville,  see   'BUSINESS  OF  TRIARC
COMPANIES -- Business Segments -- Textiles  (Graniteville).' As a result of  the
discontinuance  of  substantially  all of  SEPSCO's  other  businesses, SEPSCO's
investment in  Graniteville  will  constitute  its  largest  asset.  Because  of
Graniteville's  significance to SEPSCO, financial statements of Graniteville are
included herewith. See 'INDEX TO FINANCIAL STATEMENTS.'
 
CFC HOLDINGS
 
     SEPSCO also has an  investment in CFC  Holdings. SEPSCO owns  approximately
5.4%  of the outstanding  common stock of  CFC Holdings, the  remaining 94.6% of
which is owned by Triarc. SEPSCO accounts for its investment in CFC Holdings  on
the  equity method. CFC  Holdings owns 100%  of the outstanding  common stock of
RC/Arby's,  whose  principal  subsidiaries  are  Arby's  and  RC  Cola.  For   a
description  of  the  businesses  of  Arby's  and  RC  Cola,  see, respectively,
'BUSINESS OF TRIARC COMPANIES  -- Business Segments --  Fast Food (Arby's)'  and
'BUSINESS OF TRIARC COMPANIES -- Business Segments -- Soft Drinks (RC Cola).'
 
     In  addition,  CFC Holdings  owns all  of the  outstanding common  stock of
Chesapeake Insurance. SEPSCO also owns  15,000 shares of convertible  redeemable
preferred  stock of Chesapeake  Insurance which it purchased  in fiscal 1992 for
$1,500,000. Each  share  has a  par  value of  $100,  is entitled  to  preferred
dividends when, as and if declared at a rate of 6% per annum, and is convertible
at  any time into common shares of Chesapeake  Insurance at a price of $5.52 per
common share. If all convertible preferred shares issued by Chesapeake Insurance
were converted  to common  shares, SEPSCO's  ownership of  Chesapeake  Insurance
would  be approximately 12%.  Because the loss  reserves of Chesapeake Insurance
for insurance already written are approximately equal to its assets,  Chesapeake
Insurance's equity has been permanently impaired and no dividends or liquidating
distributions  are expected to be made to Chesapeake Insurance's equity holders.
Both SEPSCO and CFC  Holdings have, therefore, reduced  the value of the  assets
represented  by  their respective  equity interests  in Chesapeake  Insurance to
zero. See 'BUSINESS OF TRIARC COMPANIES -- Discontinued and Other Operations.'
 
RECENT TRANSACTIONS
 
     In October 1993, SEPSCO sold  the businesses that formerly constituted  its
utilities  and municipal  services segment  in three  separate transactions. The
first two of these transactions involved the sale by SEPSCO to Perkerson, Patton
Management Corp. ('PPM  Corp.') of the  stock of  each of Wright  & Lopez,  Inc.
('Wright  & Lopez'),  through which SEPSCO  conducted its  underground cable and
conduit business, and Pressure Concrete  Construction Co., through which  SEPSCO
conducted  its concrete refurbishment business.  These corporations were sold to
PPM Corp. for a nominal amount  subject to the adjustments described below.  PPM
Corp.  has agreed to  pay, as deferred  purchase price, 75%  of the net proceeds
received from the  sale or liquidation  of these corporations'  assets (cash  of
$1.8  million had been  received as of December  31, 1993) plus,  in the case of
Wright & Lopez, an amount equal to 1.25 times its adjusted book value as of  the
second  anniversary of  such sale. At  the time Wright  & Lopez was  sold to PPM
Corp., its  adjusted book  value was  approximately $1.6  million. In  addition,
SEPSCO  paid an aggregate  of $2.0 million  during October and  November 1993 to
cover the buyer's short-term operating  losses and working capital  requirements
for the construction related operations. SEPSCO's
 
                                       96
 
<PAGE>
current  estimate  of the  gain  on such  sales  is $2.0  million  excluding any
consideration of  the potential  book value  adjustment. The  other  transaction
involved  the  sale  of  substantially  all  of  the  assets  of  SEPSCO's  tree
maintenance subsidiaries to Asplundh Tree Expert Co. ('Asplundh') for a purchase
price of approximately $69.6 million in  cash, subject to certain  post  closing
adjustments,  and  the  assumption  by  Asplundh   of   certain  liabilities  of
$5,000,000 resulting  in a  loss of  approximately  $4.8  million.  The terms of
each of these transactions was the result of  arms'-length negotiations  between
SEPSCO  and PPM  Corp. and Asplundh,  as the  case may be. Neither PPM Corp. nor
Asplundh is an affiliate of SEPSCO.
 
     On November 12,  1993, SEPSCO  and Southwestern  Ice signed  the Letter  of
Intent  for the sale to  Southwestern Ice of substantially  all of the operating
assets of SEPSCO's  Ice Business  for $5 million  in cash  and approximately  $4
million  principal  amount  of  subordinated  secured  notes  due  on  the fifth
anniversary of  the sale  and  the assumption  by  Southwestern Ice  of  certain
current  liabilities. The Letter of Intent  contemplates that SEPSCO will retain
certain real  estate assets  associated with  the Ice  Business. The  Letter  of
Intent   also  contemplates   that  an   environmental  remediation   plan  (the
'Remediation Plan')  will be  prepared in  connection with  such sale  and  that
Southwestern Ice will be responsible for payment of the first and third $500,000
of  expenses  incurred  in connection  with  the Remediation  Plan,  with SEPSCO
remaining liable for the second $500,000 of expenses and any expenses in  excess
of  $1.5 million.  Completion of the  transaction contemplated by  the Letter of
Intent  is  subject  to  a  number  of  significant  conditions,  including  (i)
satisfactory  completion  by  Southwestern Ice  of  (a)  its review  of  the Ice
Business  and  (b)  the  financing   arrangements  for  the  transaction,   (ii)
preparation  of the  Remediation Plan  and (iii)  the negotiation  of definitive
documentation for the transaction. The Letter  of Intent, by its terms,  expired
on  January 11, 1994, although the parties are still continuing discussions with
respect to the transaction  contemplated by the Letter  of Intent. No  assurance
can  be given that the transaction contemplated  by the Letter of Intent will be
consummated. The terms of the transaction  contemplated by the Letter of  Intent
were  the result  of arms'-length  negotiations between  SEPSCO and Southwestern
Ice. Southwestern Ice is not an affiliate of SEPSCO.
 
ENVIRONMENTAL MATTERS
 
     Although SEPSCO has not  performed any environmental audits  on any of  the
operations  which  it continues  to  own, other  than  with respect  to  the ice
operations of its  refrigeration segment, SEPSCO  currently does not  anticipate
that  present  environmental  regulations  will  materially  affect  the capital
expenditures, earnings  or  competitive  position of  any  segment  of  SEPSCO's
businesses, except for expenditures for environmental remediation required to be
made  in the remainder of  its current fiscal year  and thereafter in connection
with  its  refrigeration  services  and  products  business.  See  'BUSINESS  OF
SEPSCO -- Business Overview -- Refrigeration Services and Products.'
 
WORKING CAPITAL
 
     SEPSCO's  working capital  requirements have generally  been fulfilled from
cash flow from operations, although, from January 1991 through April 1993 SEPSCO
had a credit facility with a commercial lender, secured by substantially all  of
the   accounts   receivable  of   the  tree   maintenance  activities   and  the
construction-related activities of  the utility and  municipal services  segment
and  certain other  receivables. In  connection with  the Reorganization, Triarc
made certain payments on account of indebtedness owed by it to SEPSCO and SEPSCO
used a portion of the proceeds thereof to pay in full all amounts due under such
credit facility and at which time such facility was terminated.
 
INTELLECTUAL PROPERTY; RESEARCH AND DEVELOPMENT; BACKLOG
 
     Patents, trademarks, licenses, franchises and concessions are not  material
to  any segment of SEPSCO's business. In the last three fiscal years, SEPSCO had
no material expenditures for research and development activities. The  existence
of  a  forward  order  backlog  is  not  material  to  any  segment  of SEPSCO's
businesses.
 
                                       97
 
<PAGE>
EMPLOYEES
 

     As of  December  31, 1993,  SEPSCO  employed approximately  624  employees,
including  approximately  169  salaried  employees.  Approximately  187  of such
employees were covered by 13 collective bargaining agreements expiring from time
to time  through 1996.  SEPSCO believes  that relationships  with employees  are
satisfactory.

 
LEGAL PROCEEDINGS
 
     In December 1990, the Ehrman Litigation, a purported stockholder derivative
suit  was brought against Triarc and other defendants on behalf of SEPSCO. For a
description of such legal proceedings, see 'SPECIAL FACTORS -- Background to the
Merger; Reasons  for the  Merger  -- Legal  Proceedings  Related to  SEPSCO  and
Triarc.'
 
     In  addition  to  the Ehrman  Litigation  and  the matters  referred  to or
described under '  -- Environmental  Matters,' SEPSCO and  its subsidiaries  are
involved   in   claims,   litigations   and   administrative   proceedings   and
investigations of various types in several jurisdictions. Such matters arise  in
the ordinary course of the business of SEPSCO and its subsidiaries and it is the
opinion  of  management that  the outcome  of any  such matter,  or all  of them
combined, will  not have  a  material adverse  effect  on SEPSCO's  business  or
consolidated financial condition.
 
PROPERTIES
 
     SEPSCO's  management believes that the properties of the operations that it
continues to  own, taken  as a  whole,  are generally  well maintained  and  are
adequate  for  current  and  foreseeable business  needs.  The  majority  of the
properties are owned. All of the properties  owned in fee by SEPSCO are  without
encumbrances,  except minor ones which do not affect the use thereof in SEPSCO's
business. Information concerning  the properties  of SEPSCO is  set forth  under
'BUSINESS  OF TRIARC COMPANIES -- Properties.'  Except as set forth therein with
respect  to  properties  listed  as  inactive,  substantially  all  of  SEPSCO's
materially important physical properties are being fully utilized.
 
                                       98

<PAGE>
             TRIARC COMPANIES MANAGEMENT'S DISCUSSION AND ANALYSIS
                           OF FINANCIAL CONDITION AND
                             RESULTS OF OPERATIONS
 
INTRODUCTION
 
     This  'Management's  Discussion  and Analysis  of  Financial  Condition and
Results of  Operations'  should  be  read  in  conjunction  with  the  financial
statements  included herein of Triarc Companies, Inc. (formerly DWG Corporation,
'Triarc' or, collectively with its subsidiaries, 'Triarc Companies').
 
     On October 27, 1993 the Triarc Board  approved a change in the fiscal  year
of  Triarc from a fiscal year ending April 30 to a calendar year ending December
31, effective for  the transition period  ending December 31,  1993. The  fiscal
years of all of Triarc's subsidiaries which did not end on December 31 were also
so  changed. As used herein, 'Fiscal 1993' refers to the fiscal year ended April
30, 1993 and 'Transition  1993' refers to the  eight months ending December  31,
1993.
 
RESULTS OF OPERATIONS
 
     Triarc  Companies reported net  losses from continuing  operations for each
fiscal year from  1989 through 1993  and for  the six months  ended October  31,
1993. Triarc believes that these losses were in large part the result of limited
managerial  and financial resources devoted to  certain of its business units, a
significant amount of high cost debt, material provisions for doubtful  accounts
from   former  affiliates  (principally  for   (i)  management  services  which,
subsequent to October  1993, Triarc  no longer  provides and  (ii) interest  and
principal  of notes  from former affiliates  for which there  are no significant
balances subsequent  to the  April 23,  1993 change  in control  of Triarc  (the
'Change  in  Control')), costs  of stockholder  and other  litigation, operating
losses of certain non-core businesses and,  with respect to Fiscal 1993 and  the
six  months  ended October  31, 1993,  certain  restructuring and  other charges
discussed below. The diversity of Triarc Companies' business segments  precludes
any overall generalization about trends for Triarc Companies.
 
     The textiles segment is subject to cyclical economic trends that affect the
domestic  textile industry.  In addition,  the textile  industry in  general has
experienced significant competition  from foreign  manufacturers that  generally
have  access  to less  expensive  labor and,  in  certain cases,  raw materials.
However, certain  fabrics which  comprise the  principal product  lines sold  by
Triarc  Companies  (e.g. workwear)  have  experienced foreign  competition  to a
lesser degree than the industry in general. Exchange rate fluctuations can  also
affect  the level of demand  for the textile segment's  products by changing the
relative price of competing fabrics from overseas producers.
 
     Trends affecting the fast food  segment in recent years include  consistent
growth  of  the  restaurant  industry  as  a  percentage  of  total food-related
spending, with fast  food being the  fastest growing segment  of the  restaurant
industry. The recent recession, however, slowed the rate of growth in restaurant
spending.  Trends affecting the soft drink segment in recent years have included
the growth of consumer demand for  diet soft drinks, the increased market  share
of  private label soft  drinks and the  introduction of 'new  age' beverages. In
recent years, both  the soft  drink and  fast food  industries have  experienced
increased   price  competition   resulting  in   significant  price  discounting
throughout these industries. While the net impact of price discounting cannot be
quantified, a continuation  of this  practice could  have an  adverse effect  on
Triarc Companies.
 
     Trends  affecting the LP  gas segment in recent  years include the economic
downturn and  energy conservation  trends, which  have negatively  impacted  the
demand for energy by both residential and commercial customers. However, LP gas,
relative  to other forms of energy, is gaining recognition as an environmentally
superior, safe,  convenient, efficient  and easy-to-use  energy source  in  many
applications.  In 1992, Congress  enacted federal legislation  that provides tax
incentives for the use of LP gas as one of five alternative forms of energy.
 
                                       99
 
<PAGE>
SIX MONTHS ENDED OCTOBER 31, 1993 COMPARED WITH SIX MONTHS ENDED OCTOBER 31,
1992
 
<TABLE>
<CAPTION>
                                                                                               OPERATING PROFIT
                                                                            REVENUES                (LOSS)
                                                                        SIX MONTHS ENDED       SIX MONTHS ENDED
                                                                          OCTOBER 31,            OCTOBER 31,
                                                                      --------------------    ------------------
                                                                        1992        1993       1992       1993
                                                                      --------    --------    -------    -------
                                                                                    (IN THOUSANDS)
<S>                                                                   <C>         <C>         <C>        <C>
Textiles...........................................................   $246,989    $270,236    $22,696    $21,912
Fast food..........................................................     98,183     112,020      8,695     11,247
Soft drink.........................................................     78,380      79,633     14,542      7,440
Liquified petroleum gas............................................     54,399      56,749     (1,367)    (1,135)
Other..............................................................     44,420       2,832     (4,148)    (9,778)
Unallocated general corporate expenses.............................      --          --        (8,289)    (7,433)
                                                                      --------    --------    -------    -------
                                                                      $522,371    $521,470    $32,129    $22,253
                                                                      --------    --------    -------    -------
                                                                      --------    --------    -------    -------
</TABLE>
 
     Revenues decreased  slightly to  $521.5  million in  the six  months  ended
October  31, 1993 from $522.4  million in the six  months ended October 31, 1992
reflecting increased revenues in each  of Triarc's core business segments  which
were  more  than  offset  by  the  absence  of  revenues  from  certain non-core
operations which were  sold in  Fiscal 1993. Textiles  revenues increased  $23.2
million  (9.4%) due to increased volume and prices. Fast food revenues increased
$13.8 million (14.1%) principally due to  an increase in both company-owned  and
franchised  same store sales. Soft drink  revenues increased $1.3 million (1.6%)
due to a significant  unit volume increase  offset in part by  the effects of  a
shift in sales mix toward lower-priced private label sales, a decline in branded
product  sales  and  a  major  private  label  customer  purchasing  a component
(aspartame) of soft drink concentrate  directly from Triarc Companies'  supplier
rather  than Triarc  Companies. While  Triarc Companies  not supplying aspartame
directly to this customer negatively impacted sales, there is no impact on gross
profit since Triarc Companies reduced its sales  price equal to its cost of  the
aspartame.  Revenues of the LP gas segment  increased $2.4 million (4.3%) due to
higher prices partially reflecting the pass through of higher product costs.
 
     Cost of sales declined  $16.3 million (4.2%) to  $368.8 million in the  six
months  ended October  31, 1993 from  $385.1 million  in the same  period of the
prior fiscal year  due principally to  the absence of  certain operations  which
were  sold in  Fiscal 1993.  Gross profit  (total revenues  less cost  of sales)
increased $15.4 million (11.2%) to $152.7 million from $137.3 million and  gross
margin  increased to 29.3% from 26.3% due principally to improved margins in the
textiles, fast food and soft drink segments.
 
     Selling, general  and administrative  expenses increased  $29.1 million  to
$130.5  million in the six months ended  October 31, 1993 from $101.4 million in
the six months ended  October 31, 1992  due principally to  (i) a $13.6  million
increase  in  advertising  and marketing  expenses  in the  soft  drink segment,
including an increase  of $7.8  million in accrued  advertising and  promotional
allowances  granted to soft drink bottlers,  the total amounts of which normally
are dependent principally upon  the achievement of annual  sales volume, (ii)  a
$10.0  million provision  for insurance loss  reserves based on  the reviews and
recommendations of  Triarc's insurance  consulting actuaries  and new  insurance
management  company  and (iii)  a $2.3  million increase  in reserves  for legal
matters principally for a  recently asserted claim by  NVF, a former  affiliate,
currently involved in proceedings under the Federal Bankruptcy Code (see Notes 2
and  11 to the Condensed Consolidated  Financial Statements of Triarc Companies,
Inc. and Subsidiaries).
 
     Consolidated operating profit declined $9.8 million to $22.3 million in the
six months ended October 31, 1993 from $32.1 million in the comparable period of
the prior fiscal year principally due to $20.1 million of significant charges in
the current year  period (as  described above  and in  Note 2  to the  Condensed
Consolidated  Financial Statements of Triarc  Companies, Inc. and Subsidiaries).
Textiles operating profit  declined $0.8  million due to  increased general  and
administrative  expenses, including  corporate charges,  which more  than offset
improved gross profit. Fast food operating profit increased $2.6 million due  to
the  improvement in revenues and gross  profit described above resulting from an
increasing focus on  quality service, local  promotions and an  increase in  the
number of franchised
 
                                      100
 
<PAGE>
restaurants.  Soft  drink  operating profit  declined  $7.1 million  due  to the
increased advertising and  marketing expenses  described above  which more  than
offset  improved  gross profit.  The LP  gas  segment's seasonal  operating loss
showed a slight improvement. Operating  loss of other operations increased  $5.6
million due to the $10.0 million provision for insurance loss reserves described
above  offset in part  by the absence  of losses of  certain non-core operations
sold or liquidated.  Unallocated general  corporate expenses in  the six  months
ended  October 31, 1993  include a $2.3  million increase in  reserves for legal
matters as described above, and in the prior year's comparable period included a
$3.7 million  provision  for doubtful  accounts  from a  former  affiliate,  APL
Corporation  ('APL'). The results for the six months ended October 31, 1993 have
not yet reflected the full benefits of Triarc's restructuring efforts.
 
     Interest expense decreased $0.1 million  due principally to lower  interest
rates substantially offset by the effect of higher borrowings resulting from the
restructuring of Triarc Companies' indebtedness.
 
     Other  expense, net in the six months ended October 31, 1993 reflects (i) a
provision of  $1.2 million  for additional  legal fees  in connection  with  the
Ehrman  Litigation which was brought against SEPSCO's directors at that time and
certain corporations, including  Triarc, and which  is in the  process of  being
settled  and (ii) a provision of $1.0  million for additional losses expected to
be incurred in connection  with the sale of  a non-core business. Other  income,
net  in  the  six  months  ended  October  31,  1992  reflected  a  net  gain of
approximately $3.3 million with respect to the sale of two non-core  businesses,
net  of a write-down to estimated net realizable value of certain other non-core
businesses, offset  in part  by expenses  of $2.5  million relating  to  certain
shareholder litigation subsequently settled.
 
     Triarc  Companies recorded a provision for  income taxes of $6.4 million in
the six months ended October 31, 1993 despite a pretax loss of $12.9 million due
to a $6.0 million increase in reserves for income tax contingencies (see Note  2
to the Condensed Consolidated Financial Statements of Triarc Companies, Inc. and
Subsidiaries),  losses  of  certain subsidiaries  for  which no  tax  benefit is
available, amortization of costs in excess  of net assets of acquired  companies
which  is not deductible  for income tax  purposes and the  increase in deferred
income taxes resulting from the increase in the Federal income tax rate from 34%
to 35%.
 
     Income from discontinued operations of  $0.2 million and $2.0 million,  for
the  six  months ended  October  31, 1993  and  1992, respectively,  reflect the
results, net  of  tax and  minority  interests,  of the  utility  and  municipal
services,  refrigeration and  natural gas  and oil  business segments  of SEPSCO
which Triarc Companies has, or plans to, dispose. The estimated loss on disposal
of $7.4 million  reflects Triarc  Companies' current  estimate of  losses to  be
incurred  on the sale or liquidation  of such discontinued operations, including
projected operating results through the anticipated disposal dates (see Notes  2
and  12 to the Condensed Consolidated  Financial Statements of Triarc Companies,
Inc. and Subsidiaries).
 
     Extraordinary item, net in the six months ended October 31, 1993 represents
a loss, net of  income tax benefit, resulting  from the early extinguishment  of
debt in August 1993 comprised of the write-off of unamortized deferred financing
costs  of $2.2  million offset  by $1.5 million  of discount  resulting from the
redemption of the debt and income tax benefit of $0.3 million.
 
     The cumulative effect of changes in accounting principles in the six months
ended October 31, 1992 resulted from a  charge of $4.9 million, net of  minority
interests,  from  the adoption  of Statement  of Financial  Accounting Standards
('SFAS') No. 109  'Accounting for Income  Taxes' ('SFAS 109')  and an  after-tax
charge, net of minority interests, of $1.5 million from the adoption of SFAS No.
106,  'Employers' Accounting  for Postretirement  Benefits Other  Than Pensions'
('SFAS 106').
 
                                      101
 
<PAGE>
FISCAL 1993 COMPARED WITH FISCAL 1992
 
<TABLE>
<CAPTION>
                                                                                              OPERATING PROFIT
                                                                      REVENUES                     (LOSS)
                                                              ------------------------      --------------------
                                                                 1992          1993           1992        1993
                                                              ----------    ----------      --------    --------
                                                                                (IN THOUSANDS)
<S>                                                           <C>           <C>             <C>         <C>
Textiles...................................................   $  456,402    $  499,060      $ 27,753    $ 47,203
Fast Food..................................................      186,921       198,915        14,271       7,852
Soft Drink.................................................      143,830       148,262        36,112      23,461
Liquefied Petroleum Gas....................................      141,032       148,790        12,676       3,008
Other......................................................      146,518        63,247        (5,746)    (15,942)
General corporate expenses.................................       --            --           (26,514)    (31,123)
                                                              ----------    ----------      --------    --------
                                                              $1,074,703    $1,058,274      $ 58,552    $ 34,459
                                                              ----------    ----------      --------    --------
                                                              ----------    ----------      --------    --------
</TABLE>
 
     Revenues declined $16.4 million (1.5%) to $1.06 billion in Fiscal 1993 from
$1.07 billion in  Fiscal 1992 principally  due to the  absence of revenues  from
certain  non-core operations (included in 'Other' in the table above) which were
sold during Fiscal 1993, offset in part by increased revenues in each of  Triarc
Companies'  major  segments.  Textiles  revenues  increased  approximately $42.7
million (9.3%) to $499.1 million from $456.4 million due to increased volume and
prices. Fast food revenues increased $12.0 million (6.4%) to $198.9 million from
$186.9 million due to additional company-owned and franchised restaurants and an
increase in same store sales  of company-owned restaurants. Soft drink  revenues
increased  $4.5 million (3.1%) to  $148.3 million from $143.8  million due to an
increase in private  label and international  sales as a  result of unit  volume
increases  partially offset by a decrease in  domestic sales of Diet Rite flavor
brands. LP gas  revenues increased $7.8  million (5.5%) to  $148.8 million  from
$141.0 million due to an increase in the number of gallons sold.
 
     Cost  of sales declined $31.2 million to $766.8 million in Fiscal 1993 from
$798.0 million in  Fiscal 1992 due  principally to the  net decline in  revenues
described  above. Gross  profit (total  revenues less  cost of  sales) increased
$14.8 million to  $291.5 million in  Fiscal 1993 from  $276.7 million in  Fiscal
1992  and gross margin  increased to 27.5%  in Fiscal 1993  from 25.7% in Fiscal
1992 due principally to higher average  selling prices and lower cost of  cotton
in the textiles segment.
 
     Selling,  general and  administrative expenses  increased $15.5  million to
$203.7 million in  Fiscal 1993  from $188.2  million in  Fiscal 1992.  Affecting
general and administrative expenses in Fiscal 1993 was a $4.9 million accrual of
compensation  paid to  a special committee  of the pre-Change  in Control Triarc
Board representing a success fee attributable  to the Change in Control, a  $2.2
million  provision for  closing certain  non-strategic company-owned restaurants
and abandoned bottling facilities, a $1.5 million provision for estimated  costs
to  comply with  recent package  labeling regulations  affecting the  soft drink
segment and other provisions aggregating $2.2  million offset by a $7.3  million
reversal  of unpaid incentive  plan accruals provided  in prior years. Affecting
general and administrative expenses  in Fiscal 1992 was  the reversal of  unpaid
incentive  plan  accruals aggregating  approximately  $10.0 million  provided in
prior years.
 
     In Fiscal  1993,  results  of operations  were  significantly  impacted  by
facilities  relocation  and  corporate restructuring  charges  aggregating $43.0
million consisting of: (i) estimated costs  of $14.9 million to relocate  Triarc
Companies'  corporate headquarters  and to terminate  the lease  on its existing
corporate facilities;  (ii) estimated  restructuring  charges of  $20.3  million
including  costs  associated  with  hiring  and  relocating  certain  new senior
management including chief executive officers of  the soft drink, fast food  and
LP  gas segments and other personnel  recruiting and relocation costs, severance
costs and  consultant fees;  (iii) total  costs of  $6.0 million  relating to  a
five-year  consulting agreement extending through  April 1998 between Triarc and
Steven Posner,  the former  Vice Chairman  of  Triarc, and  (iv) costs  of  $1.8
million  in  connection  with  a  strategic  restructuring  within  the textiles
segment. The charges referred to in items (i) through (iii) above related to the
Change  in  Control  of  Triarc  on  April  23,  1993  that  resulted  from  the
Reorganization.  In connection with the Reorganization, Victor Posner and Steven
Posner resigned as officers and directors  of Triarc. In order to induce  Steven
Posner  to resign,  Triarc entered into  the Consulting Agreement  with him. The
cost related to the Consulting Agreement was recorded as a charge in Fiscal 1993
because the Consulting Agreement does  not require any substantial services  and
Triarc  does not expect to receive any services that will have substantial value
to
 
                                      102
 
<PAGE>
it. As  a part  of the  Reorganization, the  Board of  Directors of  Triarc  was
reconstituted.  The first  meeting of the  reconstituted Board  of Directors was
held on April 24, 1993. At that  meeting, based on a report and  recommendations
from  a management  consulting firm  that had  conducted an  extensive review of
Triarc Companies' operations  and management structure,  the Board of  Directors
approved  the Restructuring  which entailed,  among other  things, the following
features: (i) the strategic decision to manage Triarc Companies in the future on
a decentralized, rather  than on  a centralized basis;  (ii) the  hiring of  new
executive officers for Triarc and the hiring of new chief executive officers and
new  senior management teams for each of Arby's, RC Cola and National Propane to
carry out the decentralization strategy; (iii) the termination of a  significant
number  of employees as a  result of both the  new management philosophy and the
hiring of an almost entirely new management team; and (iv) the relocation of the
corporate  headquarters  of  Triarc  and  of  all  of  its  subsidiaries   whose
headquarters  were located in South Florida, including Arby's, RC Cola, National
Propane, and  SEPSCO.  Accordingly,  Triarc  Companies'  cost  to  relocate  its
corporate  headquarters  and  terminate  the  lease  on  its  existing corporate
facilities ($14.9  million), and  estimated corporate  restructuring charges  of
$20.3  million including costs associated with  hiring and relocating new senior
management  and  other  personnel  recruiting  and  relocation  costs,  employee
severance  costs and consulting fees, all  stemmed from the decentralization and
restructuring plan formally adopted  at the April 24,  1993 meeting of  Triarc's
reconstituted Board of Directors. See Note 19 of Notes to Consolidated Financial
Statements  of Triarc  Companies, Inc. and  Subsidiaries. The  components of the
$4.3 million restructuring and facilities  relocation charge in Fiscal 1992  are
described below.
 
     Provision for doubtful accounts from affiliates was $10.4 million in Fiscal
1993  compared to  $25.7 million  in Fiscal 1992.  The provision  in Fiscal 1993
includes year-end charges  of $5.1 million  relating to the  final write-off  of
certain   secured  notes  and  accrued  interest  receivable  from  Pennsylvania
Engineering Corporation ('PEC') and APL, former affiliates that currently are in
bankruptcy proceedings, for which  Triarc has significant doubts  as to the  net
realizability  of the  underlying collateral, offset  by a recovery  from IRM of
certain amounts offset in connection with the minority share acquisitions in the
Reorganization.  The  remainder  of  such  provision  in  Fiscal  1993   relates
principally  to  unsecured  receivables from  APL,  including  accrued interest,
principally in  connection  with a  former  management services  agreement  with
Triarc.  Triarc was obligated to provide  certain limited management services to
several former non-subsidiary affiliates  through October 1993 and  discontinued
such  services thereafter. There can be no assurance that Triarc will be able to
collect fees from  such non-subsidiary affiliates  for such management  services
rendered.  Any such uncollectible  amounts are not expected  to be material. The
components of such provision in Fiscal 1992 are described below.
 
     Operating profit declined  $24.1 million  to $34.5 million  in Fiscal  1993
from  $58.6 million in  Fiscal 1992 due primarily  to the facilities relocation,
corporate restructuring and other significant charges aggregating $51.7  million
in  April 1993 described above. Such  charges have reduced the operating profits
reported by each of Triarc Companies' segments to the extent of charges relating
directly to their operations and also to the extent of corporate costs which are
allocable to  such segments  under the  management services  agreements  between
Triarc  and  its  subsidiaries.  Textiles operating  profit  increased  to $47.2
million (inclusive of $5.4 million of restructuring and other charges) in Fiscal
1993, from $27.8 million (inclusive of a divisional restructuring charge of $2.5
million partially offset by a $2.0 million incentive accrual reversal) in Fiscal
1992 due to  increased sales volume  and improved margins.  Fast food  operating
profit  was $7.9 million  (inclusive of $9.7 million  of restructuring and other
charges) in Fiscal 1993 compared to $14.3 million (inclusive of $1.1 million  of
restructuring  costs relating to the closing of two regional fast food franchise
offices partially offset by a $0.5 million incentive accrual reversal) in Fiscal
1992. Soft drink operating profit was $23.5 million (inclusive of $11.1  million
of  restructuring and  other charges) in  Fiscal 1993 compared  to $36.1 million
(inclusive of a $3.0  million incentive accrual reversal  partially offset by  a
$0.7  million charge for the  relocation of the soft  drink corporate office) in
Fiscal  1992.  LP  gas   operating  profit  was   $3.0  million  (inclusive   of
restructuring  and other  charges of  $8.0 million)  in Fiscal  1993 compared to
$12.7 million (inclusive of a $3.0 million incentive accrual reversal) in Fiscal
1992. Operating loss of  other operations was $15.9  million (inclusive of  $9.0
million  of provision for  write-off of notes  receivable from former affiliates
and other charges) in Fiscal 1993 compared to an operating loss of $5.7  million
(inclusive of a $5.6 million provision for
 
                                      103
 
<PAGE>
doubtful  accounts  from  affiliates)  in  Fiscal  1992.  Other  operations were
negatively impacted in  Fiscal 1993 by  the absence of  operating profits for  a
portion  of Fiscal 1993 of certain non-core businesses sold earlier in the year.
General corporate  expenses were  $31.1 million  (inclusive of  $8.5 million  of
restructuring  and  other  charges and  a  $3.3 million  provision  for doubtful
accounts from  former  affiliates) in  Fiscal  1993 compared  to  $26.5  million
(inclusive  of  an $11.2  million provision  for  doubtful accounts  from former
affiliates partially offset  by a  $1.5 million incentive  accrual reversal)  in
Fiscal 1992.
 
     Interest  expense increased $1.0 million due to  a charge in Fiscal 1993 of
$8.5 million for interest  accruals on income tax  matters, partially offset  by
interest  savings resulting from lower average levels of debt and lower interest
rates.
 
     Other income (expense), net, decreased $7.4  million to an expense of  $0.9
million  in Fiscal 1993 compared  to income of $6.5  million in Fiscal 1992. The
major components of  Other income (expense),  net, in Fiscal  1993 include  $3.2
million   in  costs  for  a  proposed  alternative  financing  which  was  never
consummated  and  expenses   aggregating  $9.3  million   relating  to   certain
shareholder  and other  litigation (of  which $5.9  million was  recorded in the
fourth quarter) offset by a credit  of approximately $8.9 million in  connection
with  the settlement of accrued rent as part  of the Change in Control and a net
gain of approximately $2.2 million with respect to the sales of certain non-core
businesses, net of write-downs of $3.8 million to estimated net realizable value
of certain assets of  other non-core businesses. The  major components of  Other
income  (expense), net in Fiscal  1992 are described below.  See also Note 15 to
Consolidated Financial Statements of Triarc Companies, Inc. and Subsidiaries.
 
     The effective income tax rates differ from the statutory rate, as described
more fully in Note  10 of Notes to  Consolidated Financial Statements of  Triarc
Companies,   Inc.  and  Subsidiaries,  due  principally  to  losses  of  certain
subsidiaries for  which no  income tax  benefit is  available, certain  expenses
which  are not deductible for tax purposes and, in Fiscal 1993, an $11.8 million
provision for income tax contingencies and other matters (of which $7.9  million
was recorded in the fourth quarter).
 
     The  effect of minority interests was a  $3.4 million credit in Fiscal 1993
compared to  a  $0.5 million  expense  in Fiscal  1992  due principally  to  the
minority  interest  effect  relating  to  the  facilities  relocation, corporate
restructuring and other significant charges in Fiscal 1993 described above.
 
     Income (loss) from discontinued operations reflects the results, net of tax
and  minority   interests,  of   SEPSCO's   utility  and   municipal   services,
refrigeration and natural gas and oil operations which Triarc has disposed of or
plans to dispose of. Loss from discontinued operations in Fiscal 1993 reflects a
$12.9  million write-down ($5.4 million net  of income tax and minority interest
credits) relating  to  the impairment  of  certain unprofitable  properties  and
accruals  for  environmental  remediation  and losses  on  certain  contracts in
progress.
 
     The Fiscal 1993 extraordinary item  resulted from the early  extinguishment
of  certain debt of RC/Arby's  in connection with the  Change in Control and was
comprised of  the write-off  of  unamortized deferred  financing costs  of  $3.7
million  and the  payment of  prepayment penalties of  $6.7 million,  net of tax
benefit of $3.8 million.
 
     The Fiscal  1993  cumulative effect  of  changes in  accounting  principles
resulted  from a  charge of  $4.9 million, net  of minority  interests, from the
adoption of SFAS 109 and an after-tax charge, net of minority interests, of $1.5
million from the adoption of SFAS 106. SFAS 109 requires an asset and  liability
approach for the accounting for income taxes. As such, deferred income taxes are
determined  based on  the tax  effect of  the differences  between the financial
statement and  tax bases  of assets  and liabilities.  The deferred  income  tax
provision  or  benefit  for  each  year  represents  the  increase  or decrease,
respectively, in the deferred  income tax liability during  such year. SFAS  109
allows  the recognition,  subject to  a valuation  allowance if  necessary, of a
deferred tax  asset  for net  temporary  differences  that will  result  in  net
deductible  amounts  in future  years.  SFAS 106  requires  Triarc to  charge to
expense the expected cost of other postretirement benefits during the years  the
employees render services.
 
     Net  loss of $60.0 million in Fiscal 1993 increased from a net loss of $7.5
million in Fiscal  1992 principally as  a result of  the Fiscal 1993  facilities
relocation,  corporate restructuring and other significant charges, including an
extraordinary charge and cumulative effect of changes in accounting  principles,
 
                                      104
 
<PAGE>
previously  discussed aggregating approximately $67.1 million, net of income tax
and minority interest credits.
 
FISCAL 1992 COMPARED WITH FISCAL 1991
 
<TABLE>
<CAPTION>
                                                                                              OPERATING PROFIT
                                                                      REVENUES                     (LOSS)
                                                              ------------------------      --------------------
                                                                 1991          1992           1991        1992
                                                              ----------    ----------      --------    --------
                                                                                (IN THOUSANDS)
<S>                                                           <C>           <C>             <C>         <C>
Textiles...................................................   $  414,174    $  456,402      $ 11,970    $ 27,753
Fast Food..................................................      181,293       186,921        12,652      14,271
Soft Drink.................................................      138,082       143,830        30,597      36,112
Liquefied Petroleum Gas....................................      150,348       141,032        13,628      12,676
Other......................................................      143,265       146,518       (19,208)     (5,746)
General corporate expenses.................................       --            --           (26,335)    (26,514)
                                                              ----------    ----------      --------    --------
                                                              $1,027,162    $1,074,703      $ 23,304    $ 58,552
                                                              ----------    ----------      --------    --------
                                                              ----------    ----------      --------    --------
</TABLE>
 
     Revenues in Fiscal  1992 increased  $47.5 million (4.6%)  to $1.07  billion
from  $1.03 billion in Fiscal 1991 principally  due to higher selling prices and
volume in  Triarc Companies'  textiles  segment and  improved volume  in  Triarc
Companies'  citrus  operations.  The  soft drink  and  fast  food  segments also
experienced moderate  increases in  revenues, however,  the LP  gas segment  and
insurance  operations and certain other non-core businesses (included in 'Other'
in the table above) experienced offsetting declines in revenues.
 
     Cost of sales increased $30.5 million to $798.0 million in Fiscal 1992 from
$767.5 million in Fiscal  1991 due principally to  the net increase in  revenues
described  above.  Gross profit  increased $17.0  million  to $276.7  million in
Fiscal 1992 from  $259.7 million in  Fiscal 1991 and  gross margin increased  to
25.7%  in  Fiscal 1992  from 25.3%  in  Fiscal 1991,  due principally  to higher
selling prices in the textiles segment.
 
     Selling, general  and administrative  expenses decreased  $26.4 million  to
$188.2  million in Fiscal 1992 from $214.6  million in Fiscal 1991 due primarily
to a  $10.4 million  decline in  claims  loss and  other expenses  of  insurance
operations  and  the  reversal  in  Fiscal  1992  of  unpaid  incentive accruals
aggregating approximately $10.0 million provided in prior years.
 
     The Fiscal 1992 facilities relocation and corporate restructuring charge of
$4.3 million  consisted of  a $2.5  million provision  relating to  a  strategic
restructuring  within the textiles segment, a $1.1 million provision relating to
the closing  of two  regional fast  food franchise  offices and  a $0.7  million
charge  for the relocation of  the soft drink corporate  office. The Fiscal 1991
facilities relocation and corporate restructuring charge of $3.8 million related
to the relocation of the fast food corporate office.
 
     Provision for doubtful accounts from affiliates was $25.7 million in Fiscal
1992 compared to  $18.0 million  in Fiscal 1991.  The provision  in Fiscal  1992
reflected $16.2 million and $1.8 million of reserves for amounts owed by APL and
PEC,  respectively,  in  connection  with  the  management  services  agreements
referred to above and  provisions of $2.2 million  and $5.5 million for  certain
notes,  accrued interest and insurance  premiums receivable from or attributable
to  APL  and  PEC,  respectively.  The  provision  for  doubtful  accounts  from
affiliates in Fiscal 1991 reflected provisions of approximately $4.3 million and
$2.7  million of  reserves for  amounts owed  by APL  and PEC,  respectively, in
connection with  such  management services  agreements  and provisions  of  $6.2
million  and $2.3 million of reserves  for certain notes, interest and equipment
lease receivables from APL and PEC,  respectively. The provision in Fiscal  1991
also  included a $1.0 million reserve  related to the indemnification of certain
construction bonding arrangements on  behalf of PEC and  a $1.5 million  reserve
for certain other unsecured amounts and insurance premiums attributable to APL.
 
     Operating  profit increased $35.3  million to $58.6  million in Fiscal 1992
from $23.3 million in Fiscal 1991,  reflecting significant increases in each  of
Triarc  Companies' major segments, except for the LP gas and fast food segments,
which experienced moderate declines in  operating profit. The largest  increases
in  operating profit occurred in the textiles  segment as a result of the higher
selling prices and volume noted  above and in the  citrus operations due to  the
absence  in Fiscal  1992 of  a significant  drop in  the market  price of frozen
concentrate processed and held for sale  in Fiscal 1991. Operating results  also
 
                                      105
 
<PAGE>
improved  in the insurance segment  as a result of a  decline in claims loss and
other expenses and  in the soft  drink segment due  primarily to higher  selling
prices.  Also contributing to  the overall increase in  operating profit was the
reversal of incentive accruals aggregating $10 million, partially offset by  the
$7.7 million increase in provision for doubtful accounts from affiliates and the
$0.5  million  increase  in facilities  relocation  and  corporate restructuring
charges described above.
 
     Interest expense increased $5.1 million principally as a result of the July
1991  restructuring  of  indebtedness  of  RC/Arby's  and  increased  short-term
borrowings of Graniteville.
 
     Other  income (expense), net, decreased $3.3 million to $6.5 million income
in Fiscal 1992 from $9.8 million in Fiscal 1991. Other income (expense), net  in
Fiscal  1992 included  gains of  $4.6 million  on repurchases  of debentures for
sinking  funds  and  interest  income  of  $3.5  million  offset  by  provisions
aggregating  approximately $3.4 million with  respect to certain shareholder and
Arby's litigation. Other income (expense), net in Fiscal 1991 included gains  of
$3.5  million on repurchases of debentures for sinking funds, interest income of
$6.8 million, credits aggregating approximately  $2.9 million with respect to  a
reduction in previously accrued rent amounts and the allocation to affiliates of
a  portion  of  previously  accrued settlement  costs  with  respect  to certain
litigation, and proceeds  aggregating $1.0  million from the  realization of  an
investment  in a  former bottling  subsidiary offset in  part by  a $4.9 million
provision for a  settlement of  litigation relating  to Graniteville's  employee
benefit  plan. See also Note 15 to Notes to Consolidated Financial Statements of
Triarc Companies, Inc. and Subsidiaries.
 
     The effective income tax rates differ from the statutory rate, as described
more fully in Note  10 of Notes to  Consolidated Financial Statements of  Triarc
Companies,   Inc.  and  Subsidiaries,  due  principally  to  losses  of  certain
subsidiaries for which no income tax benefit was available and, in Fiscal  1991,
a  tax benefit for an employee benefit plan settlement, a significant portion of
the cost of  which had been  previously accrued in  the purchase accounting  for
Graniteville at which time no tax benefit was recognizable.
 
     The effect of minority interests increased to an expense of $0.5 million in
Fiscal  1992 compared to a credit of $0.6 million in Fiscal 1991 due principally
to improved results of CFC Holdings.
 
     Income from  discontinued operations  increased due  to improved  operating
results  of SEPSCO's utility  and municipal services  and refrigeration business
segments.
 
LIQUIDITY AND CAPITAL RESOURCES
 
     Consolidated cash  and equivalents  declined $9.5  million during  the  six
months  ended  October 31,  1993  principally reflecting  (i)  net cash  used by
operations of  $31.0  million during  the  six  months ended  October  31,  1993
including  a net loss of  $27.2 million and the  changes in operating assets and
liabilities of $36.8  million (including  a $22.3 million  decrease in  accounts
payable   and  other  current  liabilities  and  a  $16.4  million  increase  in
inventories), (ii) capital expenditures of $17.3 million and (iii) other of $3.7
million partially offset by  borrowings of long-term debt  net of repayments  of
$42.5  million.  Due to  the non-recurring  nature of  the changes  in operating
assets and liabilities, Triarc  does not believe such  negative cash flows  from
operations  will continue.  The decrease in  accounts payable  and other current
liabilities, which  is net  of a  $7.8  million increase  due to  the  increased
reserve  for advertising  and promotional  allowances discussed  above, reflects
payments of operating payables which were  delayed due to the lack of  liquidity
Triarc  Companies experienced prior to the Change in Control. Such decrease also
includes a non-recurring payment of a litigation settlement of $8.1 million. The
increase in inventories  principally reflects  an increase of  $11.6 million  of
textiles  inventories and a regular  seasonal buildup of $4.0  million in the LP
gas segment. The increase in textiles inventories is principally due to sales of
certain product lines below projections during Transition 1993. Triarc Companies
is in the process of reducing such inventory to more normal levels.
 
     In August 1993,  RC/Arby's, a  wholly-owned subsidiary of  CFC Holdings,  a
94.6%  owned subsidiary  of Triarc and  98.4% owned by  Triarc Companies, issued
$275.0 million aggregate principal  amount of 9 3/4%  Senior Notes and  utilized
$223.5  million of the net proceeds therefrom to redeem all of the Step-Up Notes
at a  redemption price  of  approximately 99.3%  of  the principal  amount.  The
RC/Arby's  Refinancing resulted in a net increase in cash of approximately $51.5
million, before the  expenses of the  RC/Arby's Refinancing. The  9 3/4%  Senior
Notes    mature   on   August   1,   2000   and   do   not   provide   for   any
 
                                      106
 
<PAGE>
amortization of the principal amount thereof prior to such date. Interest at the
rate of 9 3/4% per annum is payable semi-annually on February 1 and August 1  of
each  year. The 9 3/4% Senior Notes are  secured by (i) all of the capital stock
of RC/Arby's and its  subsidiaries, RC Cola and  Arby's, and (ii)  substantially
all of the receivables, inventories and other personal properties of RC Cola and
Arby's.  RC/Arby's'  obligations with  respect to  the 9  3/4% Senior  Notes are
guaranteed by RC Cola and Arby's.
 
     On September 24,  1993 RC/Arby's  entered into a  three-year interest  rate
swap  agreement in  a notional  amount of  $137.5 million.  Under the agreement,
interest on the notional amount is paid by RC/Arby's at a floating rate which is
based on the 180-day  London Interbank Offered Rate  (the 'LIBOR Rate') (set  at
3.375% through February 1, 1994) and RC/Arby's receives interest at a fixed rate
of  4.72%. Subsequent  to February  1, 1994  the floating  rate is retroactively
reset at the end of each six-month calculation period through July 31, 1996  and
on  September 24, 1996. The  transaction effectively changes RC/Arby's' interest
rate on $137.5 million of its debt from a fixed-rate to a floating-rate basis.
 
     As of October  31, 1993  RC/Arby's had outstanding  $6.5 million  principal
amount  of the 16 7/8% Subordinated Debentures  which are scheduled to be repaid
in July 1994.
 
     Graniteville is a 51% owned subsidiary of Triarc and 85.8% owned by  Triarc
Companies.  The $180.0 million Graniteville  Credit Facility provides for senior
secured revolving credit loans  of up to $100.0  million (the 'Revolving  Loan')
and  an $80.0 million senior secured term  loan (the 'Term Loan'). The Revolving
Loan has  a  term  of five  years.  Borrowings  under the  Revolving  Loan  bear
interest,  at current borrowing levels, at either  the prime rate plus 1.25% per
annum or the LIBOR Rate  plus 3.00% per annum,  at Graniteville's option. As  of
October  31, 1993 the Revolving Loan bore interest  at a rate of 7.25%. The Term
Loan amortizes $2.5 million per quarter  through April 1, 1994 and $3.0  million
per  quarter thereafter, with  a final payment  of $22.0 million  in April 1998,
subject to mandatory  prepayments of 50%  of Excess Cash  Flow, as defined.  The
Term  Loan bears interest, based on current  borrowing levels, at the prime rate
plus 1.75% per annum or the 90-day LIBOR Rate plus 3.5% per annum. As of October
31, 1993 the Term Loan bore interest at a weighted average rate of 6.82%.  LIBOR
Rate  based borrowings  are limited to  approximately one-half  of the aggregate
outstanding borrowings under Revolving Loans and Term Loans. The borrowing  base
for the Revolving Loan is the sum of 85% to 90% of eligible accounts receivable,
as  defined, plus 65% of eligible  inventory, as defined, provided that advances
against eligible inventory shall not exceed  $35.0 million at any time, and  for
the  Term Loan is the sum of 75% of the fair market value of real estate and 80%
of the orderly liquidation  value of machinery  and equipment. The  Graniteville
Credit  Facility  is  secured by  all  of  the assets  of  Graniteville  and all
obligations  under  the   Graniteville  Credit   Facility  are   unconditionally
guaranteed  by Triarc. As collateral for  such guarantee, Triarc pledged (i) 51%
of the issued  and outstanding  stock of  Graniteville (subject  to an  existing
pledge  on such stock held by SEPSCO  securing its note receivable from Triarc),
and (ii) the issued and outstanding common stock of SEPSCO owned by Triarc.
 
     Consolidated capital  expenditures,  inclusive of  capitalized  leases  but
excluding  the discontinued operations of SEPSCO,  amounted to $27.2 million and
$21.1 million for Fiscal 1993 and  the six-month period ended October 31,  1993,
respectively.  Triarc  Companies expects  that  capital expenditures  during the
remainder of Transition  1993 and  during calendar 1994  will approximate  $22.5
million  and  $66.7 million,  respectively.  The relatively  higher expenditures
during the remainder of Transition 1993  are as a result of higher  expenditures
in  the textiles  segment due  principally to the  construction of  a new dyeing
plant during  Transition  1993 and  in  the  fast food  segment  principally  in
connection  with capital  spending related  to the  relocation of  its corporate
headquarters. The  increased  anticipated 1994  expenditures  reflect  increased
levels  of expenditures principally in the  fast food segment in accordance with
the implementation of  its plan  to open approximately  25 company-owned  stores
during  1994 at a cost of approximately $0.9 million per store, remodel existing
stores and replace equipment in such  stores. Further, the pursuit of  potential
acquisitions as part of Triarc Companies' growth strategy may also contribute to
its cash requirements.
 
     In  the fourth quarter of Fiscal 1993 Triarc Companies recorded a charge of
$43.0 million for  facilities relocation  and corporate  restructuring costs  in
connection  with the  Change in  Control. As of  October 31,  1993 the remaining
accrual   for   such   costs   was   $36.0   million.   Triarc   expects    cash
 
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requirements  for  such  accruals of  $4.2  million  and $26.4  million  for the
remainder of Transition 1993 and calendar 1994, respectively. Such payments  are
included as a component of cash flows from operations previously discussed.
 
     Federal  income  tax  returns  of Triarc  and  its  subsidiaries  have been
examined by the Internal Revenue Service ('IRS') for the tax years 1985  through
1988. Triarc Companies has resolved all but two issues related to such audit and
in  connection therewith expects to pay  approximately $8.0 million in the first
quarter of 1994, which amount has been fully reserved. Triarc Companies  intends
to contest the two open issues at the Appellate Division of the IRS. The IRS has
recently  commenced  the examination  of  Triarc Companies'  Federal  income tax
returns for the tax years from 1989  through 1992. The amount and timing of  any
payments  required as  a result of  the open  issues from the  1985 through 1988
audit as well  as the 1989  through 1992 audit  cannot presently be  determined.
However,  Triarc believes that  adequate aggregate provisions  have been made in
the current and prior  years for any tax  liabilities, including interest,  that
may result from all such examinations.
 
     Triarc  Companies  anticipates meeting  its consolidated  cash requirements
through Fiscal 1994 for debt  repayments (see above and subsequent  discussion),
capital  expenditures, acquisitions, dividend payments aggregating approximately
$5.8 million annually on  Triarc's redeemable preferred  stock and any  payments
required  as a result of the examination of Triarc Companies' Federal income tax
returns through existing cash balances, proceeds  received from the sale of  the
utility  and municipal services business segment  after the repayment of related
capital lease obligations  and taxes and  expenses (see subsequent  discussion),
future  proceeds from the  sale of remaining  noncore businesses (see subsequent
discussion) and cash flows from  operations (see prior discussion). The  ability
of  Triarc Companies to  meet its long-term cash  requirements is dependent upon
its ability  to  obtain  and  sustain  sufficient  cash  flows  from  operations
supplemented as necessary by potential financings to the extent obtainable.
 
     The  ability of each  of Triarc, RC/Arby's,  Graniteville, National Propane
and SEPSCO  to meet  its respective  short-term cash  requirements is  discussed
below.
 
TRIARC
 
     Triarc  is a holding company whose ability to meet its cash requirements is
primarily dependent upon cash flows  from its subsidiaries including  repayments
by   subsidiaries  of  outstanding  loans  from   Triarc,  loans  to  Triarc  by
subsidiaries, and reimbursement by subsidiaries to Triarc in connection with the
providing of certain management services and payments under certain tax  sharing
agreements with certain subsidiaries.
 
     Triarc's principal subsidiaries are subject to certain limitations on their
ability to pay dividends and/or make loans or advances to Triarc. The ability of
any of Triarc's subsidiaries to pay cash dividends and/or make loans or advances
to  Triarc is also dependent  upon the respective abilities  of such entities to
achieve  sufficient   cash  flows   after  satisfying   their  respective   cash
requirements, including debt service, to enable the payment of such dividends or
the  making of such loans or advances. Under the terms of the indenture relating
to the 9 3/4% Senior Notes, RC/Arby's is only permitted to pay cash dividends on
its common stock or make  loans or advances to its  parent, CFC Holdings, or  to
Triarc,  to the extent  the aggregate amount  of such payments  declared or made
after August 12, 1993 shall not exceed (a) the sum of (i) 50% of the  cumulative
net income of RC/Arby's after July 1, 1993, (ii) the aggregate net cash proceeds
received  by RC/Arby's after  the closing of the  RC/Arby's Refinancing from the
issuance or sale of  its capital stock or  from equity contributions, and  (iii)
$1.0 million (b) less 100% of the cumulative net loss of RC/Arby's after July 1,
1993. In accordance with such limitation, as of October 31, 1993 RC/Arby's could
not  pay  any dividends,  or make  any loans  or advances  to CFC  Holdings. CFC
Holdings is not presently subject to  any agreement which limits its ability  to
pay  cash  dividends  or make  loans  or  advances, although  by  reason  of the
restrictions to which RC/Arby's is subject,  the ability of CFC Holdings in  the
near term to obtain funds from its subsidiaries to do so is extremely limited.
 
     Under  its  present  credit  agreement, Graniteville  is  permitted  to pay
dividends or make loans or advances to its stockholders, including Triarc, in an
amount equal  to 50%  of the  net income  of Graniteville  accumulated from  the
beginning  of the first  fiscal year commencing  on or after  December 20, 1994,
provided that the outstanding principal  balance of Graniteville's term loan  is
less than $50
 
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million at the time of the payments (the outstanding principal balance was $77.5
million  as  of  August  31,  1993),  and  certain  other  conditions  are  met.
Accordingly, Graniteville is unable  to pay any dividends  or make any loans  or
advances to Triarc prior to December 31, 1995.
 
     Under   the  indenture  relating  to  National  Propane's  13  1/8%  Senior
Subordinated Debentures due March 31,  1999 (the '13 1/8% Debentures')  National
Propane  was permitted  as of October  31, 1993 to  pay cash dividends  of up to
approximately $14.3 million. It is  unlikely National Propane's cash flows  (see
subsequent  discussion) will permit  any cash dividends  in the immediate future
and, as a result,  Triarc currently anticipates that  any dividends declared  by
National  Propane to Triarc as the holder of all of its outstanding common stock
would be used to offset indebtedness and interest accrued thereon owed by Triarc
to National Propane.  Under the indenture  relating to the  11 7/8%  Debentures,
SEPSCO  was permitted  as of October  31, 1993, to  pay cash dividends  of up to
approximately $4.1  million  to Triarc.  National  Propane and  SEPSCO  are  not
parties  to  any  agreements restricting  or  limiting  the amount  of  loans or
advances which they may make to Triarc.
 
     As of October 31, 1993, Triarc had no outstanding external indebtedness but
it owed subsidiaries an aggregate principal amount of $244.1 million, consisting
of notes in the principal amounts of $78.4 million and $69.0 million owed to CFC
Holdings and Graniteville, respectively (which bear interest at 9.5% per  annum)
and  balances of $70.2 million of advances  owed to National Propane (which bear
interest at 16.5% per annum)  and $26.5 million remaining  on a note payable  to
SEPSCO  (which bears  interest at  13% per  annum and  is secured  by the common
shares of Graniteville owned by Triarc).
 
     In August 1993 NVF,  a corporation which was  affiliated with Triarc  until
the  April  1993 Change  in Control,  became a  debtor  in a  case filed  by its
creditors  under  Chapter  11   of  the  Federal   Bankruptcy  Code  (the   'NVF
Proceedings').  In  November  1993, Triarc  received  correspondence  from NVF's
bankruptcy  counsel  claiming  that,   on  the  theories   set  forth  in   such
correspondence,  Triarc and certain  of its subsidiaries  owed NVF approximately
$2.3 million. Triarc  intends to vigorously  contest such claims.  Nevertheless,
Triarc previously accrued approximately $0.9 million with respect to claims that
might  be  made by  NVF and,  during the  three months  ended October  31, 1993,
accrued an additional $1.4 million with respect to such matters. Triarc believes
that the outcome of the NVF Proceedings, after considering the amounts  provided
in  the current and  prior periods, will  not have a  material adverse effect on
Triarc Companies' consolidated financial condition or results of operations.
 
     Triarc will not  have significant  cash requirements for  the remainder  of
Transition  1993. Triarc expects its  significant cash requirements for calendar
1994 will include minimum required cash interest payments totaling approximately
$4.7 million on its notes payable to SEPSCO and Graniteville, dividend  payments
aggregating  approximately $5.8  million on  its redeemable  preferred stock and
general corporate  expenses  including  cash  requirements  for  its  facilities
relocation and corporate restructuring accruals of $3.7 million. Triarc believes
that   its  expected  sources   of  cash,  including   existing  cash  balances,
reimbursement of general corporate expenses from subsidiaries in connection with
management  services  agreements,  net  payments  received  under  tax   sharing
agreements  with certain  subsidiaries and  proceeds, if  any, from  the sale of
certain subsidiary operations held for sale  will be sufficient to enable it  to
meet its short-term cash needs.
 
RC/ARBY'S AND GRANITEVILLE
 
     It  is  expected  that funds  generated  from operations  of  RC/Arby's and
Graniteville,  plus  existing  cash  balances  remaining  from  the  refinancing
completed  in April 1993 and issuance of the  9 3/4% Senior Notes in the case of
RC/Arby's, and borrowings under the Graniteville Credit Facility in the case  of
Graniteville,  will be  sufficient to  enable those  subsidiaries to  meet their
respective short-term cash requirements.
 
NATIONAL PROPANE
 
     The $56.0 million outstanding principal amount of the 13 1/8% Debentures at
October 31, 1993  require semiannual  interest payments by  National Propane  on
March  1  and  September  1  of each  year  (including  an  interest  payment of
approximately   $3.7   million   made   on   September   1,   1993)   and   also
 
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require  annual sinking fund payments of $7.0 million on March 1 of each year. A
final payment of principal  on the 13  1/8% Debentures of  $21.0 million is  due
March 1, 1999.
 
     Triarc  anticipates  National  Propane's  cash  requirements,  exclusive of
operating activities, for  the remainder  of Transition 1993  and calendar  year
1994 will approximate $1.4 million and $9.6 million, respectively. The remaining
Transition  1993 amount consists  of capital expenditures  and the calendar year
1994 amount consists  of a debt  principal payment of  $7.0 million and  capital
expenditures  of $2.6  million. National  Propane had  negative cash  flows from
operations during the six months ended October 31, 1993 of $2.6 million,  during
which period National Propane profits are historically lower due to seasonality.
However,  National  Propane  believes its  cash  flows from  operations  for the
remainder of  Transition  1993, which  is  anticipated  to be  positive  due  to
seasonality,  and calendar year 1994, together  with existing cash ($6.5 million
at October 31,  1993), should be  adequate to meet  its cash requirements  noted
above.  Should  such cash  flows  not be  adequate,  Triarc may  be  required to
supplement  them  with  increased  cash  payments  of  accrued  interest  and/or
principal  on National Propane's advances to Triarc ($70.2 million as of October
31, 1993)  to  the extent  Triarc  has cash  available  for payment  or  through
restructuring of debt and/or operations by National Propane.
 
SEPSCO
 
     SEPSCO  is required to pay interest on the 11 7/8% Debentures semi-annually
on February  1 and  August 1  of each  year including  an interest  payment  due
February  1, 1994 of  $3.7 million. SEPSCO  is also required  to retire annually
through the operation of a mandatory sinking fund $9.0 million principal  amount
of  the  11  7/8%  Debentures.  The indenture  pursuant  to  which  the  11 7/8%
Debentures were issued (the  'Indenture') provides that in  lieu of making  such
payment   in  cash,  SEPSCO  may  credit  against  the  mandatory  sinking  fund
requirement the principal amount of the  11 7/8% Debentures acquired by  SEPSCO,
other  than through the sinking fund. SEPSCO presently expects that based on the
current market price for such 11 7/8% Debentures it would satisfy such mandatory
sinking fund requirement  due February 1,  1994 through cash  received from  the
sale  of  the  tree  maintenance services  operations  rather  than  through the
delivery of 11 7/8% Debentures.
 
     The Indenture  contains a  provision  which limits  to $100.0  million  the
aggregate  amount  of  specified  kinds  of  indebtedness  that  SEPSCO  and its
consolidated subsidiaries  can incur.  Effective as  of October  31, 1993,  such
indebtedness  was $63.0 million, resulting  in additional allowable indebtedness
of $37.0 million.
 
     SEPSCO anticipates its  cash requirements for  the remainder of  Transition
1993,  exclusive  of  operating  activities  and the  sale  of  the  utility and
municipal services business  segment, will approximate  $0.2 million of  capital
expenditures to provide for business expansion in the natural gas and oil and LP
gas segments. Such cash requirements for calendar 1994 will include $3.9 million
of such capital expenditures as well as $9.0 million of sinking fund payments on
the  11 7/8% Debentures. During the six months ended October 31, 1993 SEPSCO had
net  cash  outflows  with  respect  to  operating  activities  of  $0.5  million
principally  reflecting a net loss  of $0.6 million. If  the net cash flows from
operations during the remainder of 1993 and calendar 1994 is similar to that for
the first six months of Transition 1993, cash flows from operations will not  be
adequate  to  meet  its  capital expenditure  and  debt  repayment requirements.
However, SEPSCO should be able to meet such requirements during the remainder of
Transition 1993  as well  as during  calendar  year 1994  with the  excess  cash
proceeds  from the sale of the  tree maintenance services operations referred to
below (see ' -- Discontinued Operations') of $42.8 million.
 
DISCONTINUED OPERATIONS
 
     On July  22, 1993,  SEPSCO's  Board of  Directors  authorized the  sale  or
liquidation  of  SEPSCO's operating  businesses  consisting of  the  utility and
municipal services,  refrigeration,  and natural  gas  and oil  businesses.  The
natural gas and oil business will be transferred to Triarc in the form of a sale
of  the stock of  the entities comprising  the natural gas  and oil business for
cash of $8.5 million which is equal  to their fair value and approximately  $4.5
million  higher than their net book value. It is intended for this sale to occur
following the Merger and the resulting  elimination of the minority interest  in
SEPSCO
 
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(See further discussion under 'Contingencies' below). However, should the merger
not  be approved by the SEPSCO Stockholders the sale of the stock of the natural
gas and oil  entities for cash  to Triarc will  be completed prior  to July  22,
1994.
 
     On October 15, 1993 SEPSCO sold the assets of its tree maintenance services
operations  previously included in  its utility and  municipal services business
segment for $69.6 million in cash plus the assumption by the purchaser of up  to
$5.0  million in  current liabilities  resulting in a  loss of  $4.8 million. On
October 7, 1993 SEPSCO sold the stock of its two construction related operations
previously included in its utility and municipal services business segment for a
nominal amount subject to adjustments described below. As the related assets are
sold or  liquidated the  purchasers have  agreed to  pay, as  deferred  purchase
price, 75% of the net proceeds received therefrom (cash of $1.8 million had been
received  as of December 31, 1993) plus, in  the case of one of the entities, an
amount equal to 1.25 times the adjusted book value of such entity as of  October
5,  1995. As of October 8,  1993, the adjusted book value  of the assets of that
entity aggregated  approximately  $1.6  million. In  addition,  SEPSCO  paid  an
aggregate  $2.0  million  in October  and  November  1993 to  cover  the buyer's
short-term  operating   losses  and   working  capital   requirements  for   the
construction  related operations. Triarc's current estimate  of the gain on such
sales is $2.0 million  excluding any consideration of  the potential Book  Value
Adjustment, given its uncertainty.
 
     On November 12, 1993 SEPSCO signed a letter of intent to sell substantially
all  of the operating assets of the ice operations of its refrigeration business
segment for $5.0  million in cash,  a $4.0 million  note (discounted value  $3.1
million) and the assumption by the buyer of certain current liabilities which as
of November 30, 1993 approximate $1.0 million. The note, which bears no interest
during  the first year  and 5% thereafter,  would be payable  in installments of
$120,000 at the end of  each of the four years  following the closing date  with
the  balance of  approximately $3.5  million due  at the  end of  the fifth year
following the closing date. The precise  timetable for the sale and  liquidation
of  the remaining  discontinued operation,  the cold  storage operations  of the
refrigeration business segment,  will depend upon  SEPSCO's ability to  identify
appropriate  potential purchasers and to negotiate acceptable terms for the sale
of such operation. SEPSCO currently anticipates completion of such sales by July
31, 1994.
 
     On July 22, 1993  SEPSCO's Board of Directors  also authorized the sale  or
liquidation  of the liquefied petroleum gas business. SEPSCO previously reported
the liquefied petroleum gas business as a discontinued operation since it is  to
be transferred to a subsidiary of Triarc and the transfer would be accounted for
at  net book value. The precise method  of such transfer has not been determined
and the transfer will not  occur until after the  SEPSCO merger. Based on  these
facts,  SEPSCO has  reevaluated the accounting  for the  liquefied petroleum gas
business and retroactively accounted for the liquified petroleum gas business as
a continuing operation.
 
     SEPSCO used a portion of the proceeds from the sale of the tree maintenance
services operations  to pay  fees and  expenses  and repay  the portion  of  the
capitalized   lease  obligations  relating  to  the  tree  maintenance  services
operations ($24.1 million at the date  of repayment) and amounts due to  Triarc.
The  excess  of  $42.8  million  is  available  for  SEPSCO's  general corporate
purposes, including future annual sinking fund payments and semiannual  interest
payments on the 11 7/8% Debentures.
 
CONTINGENCIES
 
     In  December  1990,  the  Ehrman Litigation  was  brought  against SEPSCO's
directors at  that  time and  certain  corporations, including  Triarc,  in  the
District  Court.  On  October  18,  1993,  Triarc  entered  into  the Settlement
Agreement with the Plaintiff which was approved by the District Court on January
11, 1994. The  Settlement Agreement  provides, among other  things, that  SEPSCO
would  be merged into, or otherwise acquired by, Triarc or an affiliate thereof,
in a transaction in  which each holder  of shares of  SEPSCO Common Stock  other
than  Triarc will receive in exchange for each share of SEPSCO Common Stock, 0.8
shares of Triarc Class  A Common Stock. The  Settlement Agreement also  provides
that  Plaintiff's counsel and  financial advisor will be  paid, subject to court
approval, cash  not to  exceed $1.3  million. On  November 22,  1993 Triarc  and
SEPSCO entered into the Merger Agreement. Following the Merger, Triarc Companies
would  own  100% of  the  SEPSCO Common  Stock.  Consummation of  the Settlement
Agreement and the Merger are conditioned on, among other things, approval by the
SEPSCO Stockholders.
 
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<PAGE>
     In September 1989, the Pennsylvania Insurance Commissioner as rehabilitator
of Mutual Fire  commenced an action  in the Commonwealth  Court of  Pennsylvania
against  Chesapeake Insurance, a  wholly-owned subsidiary of  CFC Holdings. Such
action, among other  things, seeks recovery  of $4.0 million  allegedly owed  by
Chesapeake  Insurance  in  connection  with  certain  reinsurance  arrangements,
specific performance by  Chesapeake Insurance of  its alleged obligations  under
certain  reinsurance arrangements by requiring Chesapeake Insurance to provide a
letter of credit  in an  amount in  excess of  $12.0 million  to secure  certain
alleged   outstanding  losses,  a  restitution   and  accounting  by  Chesapeake
Insurance, and compensatory and punitive damages in an amount in excess of $40.0
million arising out  of alleged bad  faith in connection  with such  reinsurance
arrangements.  In November  1993 Chesapeake Insurance  entered into  a letter of
intent with Mutual  Fire for full  settlement of all  claims for $12.0  million.
Such  settlement is  subject to execution  of a  definitive settlement agreement
which  agreement  is  subject   to  approval  of   the  Commonwealth  Court   of
Pennsylvania.  Triarc Companies has fully provided  for such settlement in prior
years.
 
     Chesapeake Insurance is registered under the Bermuda Insurance Act of  1978
and  related  regulations  which  require  compliance  with  various  provisions
regarding  the  maintenance  of  statutory  capital  and  liquidity.  Chesapeake
Insurance was not in compliance with the required solvency ratio as of September
30,  1993. In December 1993 Triarc  Companies decided to cease writing insurance
and reinsurance of any  kind through Chesapeake Insurance.  As a result of  this
decision,  the  non-compliance with  the solvency  test will  have no  effect on
Triarc Companies. Since Chesapeake Insurance will not have any future  operating
cash  flows  for the  payment  of claims  on  insurance previously  written, its
existing liabilities will  be liquidated  with cash  and equivalents,  including
restricted  cash, collections of premiums receivable, investments, funds held by
insurance carriers  and collection  of notes  receivable from  CFC Holdings  and
RC/Arby's as they become due.
 
     As  of October  31, 1993, Chesapeake  Insurance had total  assets of $100.8
million and  total liabilities  of $100.3  million, including  $86.3 million  of
non-current  insurance loss  reserves ($6.9 million  of which  relates to Mutual
Fire). Assets include $31.8 million of notes receivable from CFC ($28.0 million)
and RC/Arby's ($3.8 million) plus $5.6 million of accrued interest thereon.  The
note  receivable from  CFC Holdings is  due $10.0  million in each  of the years
ended December 31, 1995 and 1996 with  the $8.0 million balance due in the  year
ended  December 31, 1997. The note receivable from RC/Arby's is due $0.5 million
during the  remainder of  Transition 1993  and $3.3  million in  the year  ended
December  31,  1994. Accordingly,  as  the non-current  insurance  loss reserves
mature, Chesapeake Insurance will need to  collect on these notes receivable  in
order to meet these obligations. Chesapeake Insurance expects to be able to meet
its  cash requirements  through collections of  the notes from  CFC Holdings and
RC/Arby's.
 
     In 1987, Graniteville was notified by  the DHEC that it discovered  certain
contamination  of  Langley  Pond  near  Graniteville,  South  Carolina  and DHEC
asserted that  Graniteville may  be  one of  the  parties responsible  for  such
contamination.  Graniteville  entered into  a consent  decree providing  for the
study and investigation  of the  alleged pollution  and its  sources. The  study
report  prepared by Graniteville's environmental  consulting firm and filed with
DHEC in April 1990, recommended that  pond sediments be left undisturbed and  in
place.   DHEC  responded  by  requesting  that  Graniteville  submit  additional
information concerning potential passive and active remedial alternatives,  with
accompanying  supportive  information. In  May  1991 Graniteville  provided this
information to DHEC in a report of Graniteville's environmental consulting firm.
The 1990  and  1991  reports  concluded  that  pond  sediments  should  be  left
undisturbed  and in place  and that other  less passive remediation alternatives
either provided  no  significant  additional  benefits  or  themselves  involved
adverse  effects  on  human health,  to  existing  recreational uses  or  to the
existing biological communities. Triarc is unable  to predict at this time  what
further actions, if any, may be required in connection with Langley Pond or what
the cost thereof may be. However, given the passage of time since the submission
of  the two reports by Graniteville's  environmental consulting firm without any
objection or  adverse  comment  on such  reports  by  DHEC and  the  absence  of
desirable  remediation alternatives, other than  continuing to leave the Langley
Pond sediments in  place and  undisturbed as  described in  the reports,  Triarc
believes  the ultimate outcome of  this matter will not  have a material adverse
effect on  Triarc Companies'  consolidated results  of operations  or  financial
position.
 
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<PAGE>
     As a result of certain environmental audits in 1991, SEPSCO became aware of
possible  contamination by hydrocarbons and metals  at certain sites of SEPSCO's
refrigeration operations  and has  filed  appropriate notifications  with  state
environmental  authorities and has  begun a study of  remediation at such sites.
SEPSCO has  removed  certain underground  storage  and other  tanks  at  certain
facilities   of  its  refrigeration  operations   and  has  engaged  in  certain
remediation in connection therewith. Such removal and environmental  remediation
involved  a  variety  of remediation  actions  at various  facilities  of SEPSCO
located in a number of jurisdictions. Such remediation varied from site to site,
ranging from testing of soil  and groundwater for contamination, development  of
remediation  plans  and removal  in  certain instances  of  certain contaminated
soils. Based  on preliminary  information and  consultations with,  and  certain
reports of, environmental consultants and others, SEPSCO presently estimates the
cost  of such remediation  and/or removal will approximate  $3.7 million, all of
which was provided in prior years. In connection therewith, SEPSCO has  incurred
actual  costs  through October  31, 1993  of  $1.0 million  and has  a remaining
accrual of $2.7 million.  Triarc believes that after  such accrual the  ultimate
outcome  of  this matter  will  not have  a  material adverse  effect  on Triarc
Companies' consolidated results of operations or financial position.
 
INFLATION AND CHANGING PRICES
 
     Management believes that  inflation did  not have a  significant effect  on
gross  margins during  the three  years ended April  30, 1993  and the six-month
period ended  October 31,  1993,  since inflation  rates generally  remained  at
relatively  low levels.  Historically, Triarc  Companies has  been successful in
dealing with the impact of inflation  to varying degrees within the  limitations
of the competitive environment of each segment of its business.
 
PENDING ACCOUNTING PRONOUNCEMENTS
 
     In  November 1992, the FASB issued SFAS No. 112, 'Employers' Accounting for
Postemployment Benefits' which  requires the accrual  of certain  postemployment
benefits  under certain circumstances. Triarc Companies' accounting is currently
in accordance with SFAS No. 112 either because Triarc Companies does not provide
certain of the benefits contemplated, provides for certain of such services  but
at no cost to Triarc Companies or does not meet the requirements for accrual and
such amounts are immaterial.
 
                                      113

<PAGE>
                              SEPSCO MANAGEMENT'S
                 DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
                           AND RESULTS OF OPERATIONS
 
RESULTS OF OPERATIONS
 
NINE MONTHS ENDED NOVEMBER 30, 1993 COMPARED WITH NINE MONTHS ENDED NOVEMBER 30,
1992
 
     Net sales increased from $18.9 million in 1992 to $19.8 million in 1993 due
to  higher volume of liquefied petroleum gas  sales due to colder weather in the
regions serviced by  such business  in 1993, offset  in part  by slightly  lower
average selling prices reflecting lower product costs.
 

     Operating  profit decreased  from $1.7 million  in 1992 to  $0.4 million in
1993 principally  due  to  a  $1.5 million  increase  in  selling,  general  and
administrative  expenses. Such increase  was principally due  to $0.8 million of
the aggregate $4.7 million of 1993 corporate restructuring charges allocated  to
the  liquefied  petroleum  gas business  and  included in  selling,  general and
administrative expenses. The aggregate  $4.7 million of corporate  restructuring
charges  consisted  of $4.2  million of  charges allocated  to SEPSCO  by Triarc
including: (i) estimated allocated costs of $2.8 million to terminate the  lease
on  Triarc's existing corporate  facilities; (ii) total  allocated costs of $1.4
million relating to the five  year Consulting Agreement extending through  April
1998  between Triarc and Steven  Posner, the former Vice  Chairman of Triarc and
$0.5 million of estimated  costs to be incurred  by SEPSCO to relocate  SEPSCO's
corporate  office. All of such  charges are related to  the change in control of
Triarc, SEPSCO's  parent, which  occurred  on April  23,  1993 (the  'Change  in
Control').  The $0.9 million  increase in net sales  was substantially offset by
the $0.6 million increase in cost of sales.

 
     Interest expense decreased  from $9.8 million  in 1992 to  $7.5 million  in
1993  due primarily to the lower debt  outstanding and, to a much lesser extent,
lower interest rates during 1993.
 
     Equity in earnings  of affiliates  before cumulative effect  of changes  in
accounting  principles decreased  from $9.6 million  in 1992 to  $4.3 million in
1993 due to  decreased earnings  of Graniteville and,  to a  lesser extent,  CFC
Holdings.  Such  lower  earnings  are  principally  attributable  to  (i) higher
corporate charges from Triarc  to Graniteville during the  first nine months  of
the  ten  months  ended  December  31,  1993  ('SEPSCO  Transition  1993'), (ii)
provisions for insurance losses by CFC Holdings' subsidiary Chesapeake Insurance
(see below), (iii) certain significant charges recorded in the first quarter  of
SEPSCO  Transition  1993  relating  to  costs  allocated  from  Triarc  to  such
affiliates primarily for facilities  relocation and corporate restructuring  and
to  compensation paid to a special committee  of Triarc's Board of Directors and
(iv) the  write-off  of Graniteville's  $2.5  million investment  in  Chesapeake
Insurance (see below).
 
     SEPSCO  also wrote off its $1.5  million investment in Chesapeake Insurance
since such investment is no longer deemed recoverable as a result of  Chesapeake
Insurance reducing its stockholders' equity to $0.3 million following additional
provisions  for  insurance  losses of  $10.0  million during  its  quarter ended
September 30, 1993 and the decision by Triarc in December 1993 to cease  writing
new insurance or reinsurance of any kind through Chesapeake Insurance.
 
     The  decrease in interest income from  Triarc of $2.4 million resulted from
the lower outstanding balance of the Triarc  note receivable as a result of  the
April 1993 repayment of $28.9 million in connection with the Change in Control.
 
     Other  income, net increased from  $0.1 million in 1992  to $0.6 million in
1993. The 1993 amount  includes a reversal of  a $1.3 million accrual,  provided
for  in the fourth quarter  of the year ended  February 28, 1993 ('SEPSCO Fiscal
1993'), for the legal  counsel and financial advisor  fees for the Plaintiff  in
the  Ehrman Litigation. Such fees will now  be paid by Triarc instead of SEPSCO,
as originally  anticipated, in  accordance with  the Settlement  Agreement  (see
further  discussion below)  entered into in  October 1993. The  1993 amount also
includes a net  accrual of  $1.0 million for  SEPSCO's expenses  related to  the
proposed Merger (see further discussion below).
 
     SEPSCO recorded a benefit from income taxes of $1.8 million during the 1993
period  despite a  pretax loss of  $0.6 million, representing  an effective rate
substantially in  excess of  the  35% statutory  rate,  principally due  to  the
inclusion  in pretax loss of equity in earnings of affiliates of $4.3 million on
 
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<PAGE>
which no income taxes were provided.  SEPSCO recorded a benefit of $0.2  million
despite  pretax income of $7.2 million during the nine months ended November 30,
1992 principally due to the inclusion in pretax income of equity in earnings  of
affiliates  of $9.6  million on  which income  taxes were  provided only  on the
portion remaining after an 80% dividend exclusion.
 
     Income (loss) from discontinued operations,  net of income taxes  decreased
$24.3  million to a loss of $23.4 million in 1993 from income of $0.9 million in
1992 primarily due to the following reasons:
 

          In  connection  with  the  consummation  of  the  sales  of  the  tree
     maintenance services operations and the construction related operations and
     the  signing  of a  letter of  intent  to sell  the ice  operations, SEPSCO
     reevaluated the estimated gain  or loss from the  sale of its  discontinued
     operations and provided $13.9 million for the estimated loss on the sale of
     the  discontinued operations  from an  estimated break-even  position as of
     August 31, 1993. The revised estimate principally reflects (i) $4.7 million
     of losses from the sales of operations comprising the utility and municipal
     services  business  segment  previously   estimated  to  be   approximately
     break-even  and (ii)  $6.6 million  of losses  from the  sale of operations
     comprising SEPSCO's refrigeration business segment previously estimated  to
     be  a gain  of $1.6  million, (iii) $2.5  million of  estimated losses from
     operations from July 22, 1993 to the actual or estimated disposal dates  of
     the  discontinued operations and  (iv) less previously  estimated losses of
     $1.5 million from the sale of SEPSCO's natural gas and oil business segment
     which now will be transferred to Triarc. Since such transfer will be  among
     companies in a controlled group it will be accounted for at net book value.
     The  net loss from the sale of  the utility and municipal services business
     segment reflects a  reduction of $2.0  million due to  a decrease in  asset
     sales  of the construction related activities by July 31, 1994, a reduction
     of $1.8 million in the estimated  sales price for the construction  related
     operations  from previous estimates and other adjustments in finalizing the
     loss on the  sale of  the tree  maintenance services  operations. The  $8.2
     million  charge relating to the sale  of the refrigeration business segment
     principally results from (i)  a $4.0 million reduction  in the sales  price
     for  the  ice operations  based on  the letter  of intent  and (ii)  a $4.0
     million reduction  in  the  estimated  sales  price  of  the  cold  storage
     operations  based  on  preliminary sales  discussions  and  experience with
     respect to negotiating the sale of the other operations.

 
          SEPSCO recorded an $8.0 million write-down relating to the  impairment
     of   certain  unprofitable  properties  in  the  first  quarter  of  SEPSCO
     Transition 1993.
 
          Operating profits of certain business segments through July 22,  1993,
     exclusive  of  the  above  charges,  also  declined.  The  tree maintenance
     activities experienced a decline in earnings due to higher insurance costs,
     losses on certain contracts and start-up  costs on new crews. The  flooding
     conditions  experienced during the second quarter of SEPSCO Transition 1993
     prevented the  generation of  revenues by  crews added  in anticipation  of
     increased  workload, whereas SEPSCO  Fiscal 1993 was  favorably affected by
     the additional work in connection  with Hurricane Andrew. The  construction
     related activities experienced a decline due to a lower number of contracts
     in  progress and  losses experienced  on existing  contracts. Refrigeration
     operations had lower margins due to lower revenues from cold storage due to
     lower occupancy  rates and  lower  margins in  the  ice operations  due  to
     competitive conditions.
 
          The  corporate  restructuring  charges described  above  included $3.9
     million of charges included in the 1993 loss from discontinued operations.
 
     Effective March 1, 1993, SEPSCO changed its method of accounting for income
taxes when it adopted the provisions of SFAS 109. The cumulative effect on prior
years of the change in accounting principles decreased the net loss for the nine
months ended November  30, 1993  by $7.6 million  or $.65  per share.  Effective
January  1, 1993, CFC Holdings adopted SFAS 109 and SFAS 106. SEPSCO's equity in
the cumulative effect of changes in accounting principles amounts to a charge of
$0.1 million or  $.01 per share.  Effective March 1,  1992 Graniteville  adopted
SFAS  109 and SFAS 106. The changes in accounting principles resulted in charges
in the nine months ended  November 30, 1992 amounting  to $6.0 million, (net  of
taxes of $0.4 million), or $.51 per share.
 
                                      115
 
<PAGE>
SEPSCO FISCAL 1993 COMPARED WITH SEPSCO FISCAL 1992
 
     Net sales decreased from $29.2 million in 1992 to $28.5 million in 1993 due
to  a decrease in the average selling  prices, coupled with a slight decrease in
volume due to unseasonably warmer weather and increased competitive conditions.
 
     Operating profit decreased  from $4.6 million  in 1992 to  $3.6 million  in
1993  principally due  to the  decrease in  sales as  explained above,  and to a
lesser extent higher cost of product.
 
     Equity in earnings  of affiliates  before cumulative effect  of changes  in
accounting  principles and  extraordinary items  increased from  $5.2 million in
1992 to $12.2 million in 1993 due to increased earnings of Graniteville.
 
     The gain on sale of marketable  security of $6.0 million resulted from  the
recognition  of a  gain previously deferred  on the  sale of common  stock of an
unaffiliated company to Triarc. Such gain had been deferred until collection  of
a  note received from Triarc in consideration  of such sale was assured. As such
note was collected in April 1993, the gain was recorded in SEPSCO Fiscal 1993.
 
     Gains on repurchase  of debentures for  sinking fund requirement  decreased
from $4.0 million in 1992 to $.01 million in 1993 due to the market price of the
11  7/8% Debentures  which increased  to above  par, and  accordingly, since the
repurchase of the 11 7/8% Debentures was no longer beneficial, the sinking  fund
requirement was made in cash.
 
     Other, net decreased from income of $0.4 million in 1992 to expense of $1.1
million  in 1993  principally due  to a  $1.3 million  accrual for  the proposed
settlement of the Ehrman Litigation.
 
     Provision for  income  taxes as  a  percentage of  income  from  continuing
operations  before income  taxes, extraordinary  items and  cumulative effect of
changes in accounting principles for the year was lower than the statutory  rate
due  to the equity in earnings of affiliates on which income taxes were provided
only on the portion remaining after an 80% dividend exclusion.
 
     Loss from discontinued operations, net of income taxes, increased from $0.2
million in  1992 to  $5.5 million  in 1993  principally due  to a  $3.7  million
reduction  in gross profit in the utility  and municipal services segment due to
competitive conditions  experienced  principally  in  the  construction  related
activities  and  the tree  maintenance operations  due to  intensely competitive
bidding in the first quarter of fiscal 1993 which resulted in losses of  certain
contracts,  most  of which  were replaced  by  ones with  lower margins  and the
adjustment of  prices to  retain  certain other  existing contracts.  Also,  the
refrigeration operations recorded a $2.1 million accrual before income taxes for
potential  environmental remediation, whereas the  1992 period included a credit
of $1.4  million  as proceeds  from  settlement  of certain  litigation  of  the
construction  operations. These factors were partially  offset by a benefit from
income taxes of $2.4 million in 1993 compared to a benefit from income taxes  of
$0.3 million in 1992.
 
     Equity  in  cumulative  effect  of  changes  in  accounting  principles  of
affiliate, net of taxes, of  $6.0 million resulted from Graniteville's  adoption
of SFAS 109 and SFAS 106 during fiscal 1993.
 
     Equity  in extraordinary items  of affiliate of  $0.3 million resulted from
the early extinguishment of debt by CFC Holdings.
 
SEPSCO FISCAL 1992 COMPARED WITH SEPSCO FISCAL 1991
 
     Net sales were flat in 1991 compared with 1992 due to the offsetting effect
that the lower average selling prices had on the increased volume.
 
     Operating profit increased  from $3.2 million  in 1991 to  $4.6 million  in
1992  due  to lower  cost  of product  in the  1992  period, coupled  with lower
selling, general and administrative  expenses principally due  to a decrease  in
the provision for doubtful accounts of affiliates.
 
     Interest  expense increased from $12.9 million  in 1991 to $13.7 million in
1992 due to  higher interest  costs related  to increased  borrowings under  the
receivable financing arrangement.
 
     Equity  in earnings  of affiliates before  cumulative effect  of changes in
accounting principles and  extraordinary items  increased from  $2.7 million  in
1991 to $5.2 million in 1992 due to the increased earnings of Graniteville.
 
                                      116
 
<PAGE>
     Gains  on repurchase of  debentures for sinking  fund requirement increased
from $3.5 million in 1991 to $4.0 million in 1992 due to the lower market  price
of the 11 7/8% Debentures at the time of purchase in 1992.
 
     Other,  net  decreased from  $1.8 million  income in  1991 to  $0.4 million
income in  1992 due  to a  $1.3  million gain  on the  sale of  a  non-operating
property of the LP Gas segment in 1991.
 
     The provision for income taxes in 1992 and 1991 was less than the statutory
rate  of 34% principally due  to the inclusion in  pre-tax earnings of equity in
earnings of affiliates on which income  taxes were provided only on the  portion
remaining after an 80% dividend exclusion.
 
     Loss  from discontinued operations, net of income taxes decreased from $7.9
million in  1991 to  $0.2 million  in 1992  due to  higher revenues  in all  the
discontinued  segments of SEPSCO, with the exception  of the natural gas and oil
segment, and higher margins. The increase in gross profit of $5.6 million before
income taxes was principally the result of improved productivity in the  utility
and  municipal services segment and higher  occupancy rates in the refrigeration
segment offset  in part  by lower  selling prices  in the  natural gas  and  oil
segment.  Also, favorably  affecting income (loss)  from discontinued operations
net of income taxes in 1992 was  a decrease of $4.2 million in selling,  general
and  administrative  expenses, principally  due to  a  $2.7 million  decrease in
provision for doubtful accounts  of affiliates and a  $1.4 million proceed  from
the  settlement of certain litigation. These  increases were partially offset by
benefit from income taxes  in 1992 of  $0.3 million compared  to a benefit  from
income taxes of $4.0 million in 1991.
 
FINANCIAL CONDITION AND LIQUIDITY
 
     At  February 28, 1993 and November 30, 1993 cash and equivalents, excluding
restricted cash, amounted to $0.2  million and $35.8 million, respectively.  The
$35.6  million increase in cash is principally  a result of the remaining excess
proceeds from  the  sale  of  the  tree  maintenance  services  operations  (see
subsequent  discussion).  Total debt,  including  the debt  of  the discontinued
operations, amounted to $110.2  million and $60.8 million  at February 28,  1993
and November 30, 1993, respectively.
 
     As previously reported, a change in control of Triarc occurred on April 23,
1993  (the 'Closing Date'), which as a  result of Triarc's ownership of SEPSCO's
voting securities  constituted a  change  in control  of SEPSCO.  In  connection
therewith  SEPSCO received from Triarc $27.1 million in cash and $3.5 million in
the form  of  an offset  of  amounts due  to  Triarc as  of  April 23,  1993  in
connection  with  the  providing by  Triarc  of certain  management  services to
SEPSCO. The aggregate $30.6 million of payments by Triarc included full  payment
of  $6.8 million  (including $0.3 million  of accrued interest)  on an unsecured
promissory note issued to SEPSCO by Triarc  in connection with the 1988 sale  of
an  investment and partial  payment of $23.8 million  (including $1.4 million of
accrued interest) on  a $49.0 million  promissory note due  to SEPSCO  resulting
from  the  1986 sale  of  approximately 51%  of  Graniteville's common  stock to
Triarc, as described below.  SEPSCO used the $27.1  million of cash proceeds  to
pay  $12.7 million due under its accounts receivable financing arrangement which
was then terminated and to pay $14.4 million (including $0.4 million of  accrued
interest) owed to Chesapeake Insurance.
 
     SEPSCO  holds a  promissory note (the  'Note') from Triarc  in the original
face amount of approximately $49.0 million, bearing interest at the annual  rate
of  13% payable semi-annually.  As described above, on  the Closing Date, SEPSCO
received partial payment of the  Note of approximately $23.8 million  (including
$1.4  million of accrued interest) from Triarc. The Note, after giving effect to
such prepayment,  is due  in August  1998 and  resulted from  the 1986  sale  of
approximately 51% of the outstanding common shares of Graniteville to Triarc and
is  secured by such shares.  The Note is subordinated  to senior indebtedness of
Triarc to the extent, if any, that the payment of principal and interest thereon
is not satisfied out of proceeds of the pledged Graniteville shares.
 
     SEPSCO  has  not  received  any  cash  dividends  from  its  investment  in
Graniteville  during the nine months ended  November 30, 1993 compared with $3.0
million in the comparable prior year period.
 
     Under its  present  credit  agreement, Graniteville  is  permitted  to  pay
dividends  or make loans or advances to its stockholders, including SEPSCO in an
amount equal  to 50%  of the  net income  of Graniteville  accumulated from  the
beginning    of    the   first    fiscal   year    commencing   on    or   after
 
                                      117
 
<PAGE>
December  20,  1994,  provided  that   the  outstanding  principal  balance   of
Graniteville's  term loan is less than $50.0  million at the time of the payment
(the outstanding principal balance  was $75.0 million as  of November 30,  1993)
and certain other conditions are met. Accordingly, Graniteville is unable to pay
any  dividends or  make any loans  or advances  to SEPSCO prior  to December 31,
1995.
 
     SEPSCO is required to pay interest on the 11 7/8% Debentures  semi-annually
on February 1 and August 1 of each year including interest payments due February
1,  1994 and August 1, 1994 aggregating $6.9 million. SEPSCO is also required to
retire annually through the operation of  a mandatory sinking fund $9.0  million
principal  amount of  the 11  7/8% Debentures  on February  1 of  each year. The
Indenture provides that,  in lieu  of making such  payment in  cash, SEPSCO  may
credit  against the mandatory  sinking fund requirement  the principal amount of
11 7/8% Debentures acquired  by SEPSCO other than  through the sinking fund.  On
February  1, 1993, SEPSCO satisfied such  sinking fund requirement by payment of
$8.7 million in cash and  the delivery of $0.3  million principal amount of  the
11  7/8% Debentures. SEPSCO  obtained substantially all of  the funds to satisfy
such sinking  fund requirement  by  borrowings from  Chesapeake Insurance  as  a
result  of increasing  its loans  from Chesapeake  Insurance by  $8.4 million to
$14.0 million. As described elsewhere herein, such loans were repaid in full  on
the  Closing Date.  SEPSCO presently  expects that  based on  the current market
price for such 11 7/8% Debentures  it would satisfy such mandatory sinking  fund
requirement due February 1, 1994 through cash received from the sale of the tree
maintenance  services operations  rather than  through the  delivery of  11 7/8%
Debentures.
 
     The Indenture  contains a  provision  which limits  to $100.0  million  the
aggregate  amount  of  specified  kinds  of  indebtedness  that  SEPSCO  and its
consolidated subsidiaries can incur. At November 30, 1993 such indebtedness  was
$59.3  million resulting in allowable additional indebtedness, if SEPSCO desired
to make  such borrowings  and if  such  financing could  be obtained,  of  $40.7
million.
 
     On  October 18,  1993, Triarc  entered into  the Settlement  Agreement. The
Settlement Agreement provides, among other  things, that SEPSCO would be  merged
into, or otherwise acquired by, Triarc or an affiliate thereof, in a transaction
in  which  each  holder of  shares  of  SEPSCO Common  Stock  other  than Triarc
Companies, will receive in exchange for  each share of SEPSCO Common Stock,  0.8
shares  of Triarc Class A  Common Stock. On November  22, 1993 Triarc and SEPSCO
entered into the Merger Agreement pursuant to which a subsidiary of Triarc  will
be  merged  into SEPSCO  in the  manner described  in the  Settlement Agreement.
Following the Merger, Triarc  Companies would own 100%  of SEPSCO Common  Stock.
Consummation  of the  Settlement Agreement  and the  Merger are  conditioned on,
among other things, approval of the  Merger by SEPSCO's stockholders other  than
Triarc Companies. On January 11, 1994 the District Court approved the Settlement
Agreement.
 
     On  July  22, 1993,  SEPSCO's  Board of  Directors  authorized the  sale or
liquidation of its utility and municipal services, refrigeration and natural gas
and oil businesses. On December 9, 1993 SEPSCO's Board of Directors decided  the
natural  gas and oil business  will be transferred to  Triarc rather than SEPSCO
selling it to an independent third party. Such transfer will be in the form of a
sale of the stock of  the entities comprising the  natural gas and oil  business
for  cash of $8.5 million  which is equal to  their fair value and approximately
$4.5 million higher than their net book  value. It is intended for this sale  to
occur  following  the  Merger  and the  resulting  elimination  of  the minority
interest in SEPSCO.  However should  the Merger not  be approved  by the  SEPSCO
stockholders  the sale of the stock of the natural gas and oil entities for cash
to Triarc will be completed prior to July 22, 1994.
 
     On October 15, 1993 SEPSCO sold the assets of its tree maintenance services
operations previously included  in its utility  and municipal services  business
segment  for $69.6 million in cash plus  the assumption by the purchaser of $5.0
million in current liabilities  resulting in a loss  of $4.8 million. The  $35.5
million  cash balance as  of November 30,  1993 is principally  a result of such
cash proceeds,  less  the  repayment  of  $24.1  million  of  capitalized  lease
obligations  relating to the tree  maintenance services operations, repayment of
$1.1 million  of amounts  due to  Triarc, payment  of the  $2.0 million  to  the
purchasers  of  the  construction  related operations  (see  below)  and general
operating requirements since October  15, 1993. On October  7, 1993 SEPSCO  sold
the  stock of its two construction related operations previously included in its
utility and municipal services business segment for a nominal amount subject  to
adjustments  described below. As  the related assets are  sold or liquidated the
purchasers have  agreed to  pay, as  deferred  purchase price,  75% of  the  net
proceeds received therefrom (cash of $1.5 million had
 
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<PAGE>
been  received as of November 30,  1993) plus, in the case  of the larger of the
two entities, an  amount equal to  1.25 times  the adjusted book  value of  such
entity  as of October  5, 1995 (the  'Book Value Adjustment').  As of October 7,
1993,  the  adjusted  book  value  of  the  assets  of  that  entity  aggregated
approximately $1.6 million. In addition, SEPSCO paid $2.0 million in October and
November  1993  to cover  the buyer's  short-term  operating losses  and working
capital requirements for the construction related operations. As of November 30,
1993 SEPSCO estimated  the sales  of the construction  related operations  would
result  in a gain of  $2.0 million excluding any  consideration of the potential
Book Value Adjustment. In January 1994,  however, SEPSCO learned that the  buyer
of  such  businesses had  successfully  negotiated extensions  of  certain major
contracts with respect  to the  larger of  such businesses  and as  a result  no
longer intends to immediately dispose of the major portion of the assets. Should
the  buyer hold such  assets through October  5, 1995, the  purchase price would
effectively be realized through the Book Value Adjustment. Based on such revised
estimates of asset sales,  SEPSCO would approximately  break even excluding  any
consideration of the potential Book Value Adjustment, given its uncertainty.
 
     On November 12, 1993 SEPSCO signed a letter of intent to sell substantially
all  of the operating assets of the ice operations of its refrigeration business
segment for $5.0  million in cash,  a $4.0 million  note (discounted value  $3.1
million) and the assumption by the buyer of certain current liabilities which as
of  November 30, 1993 would  approximate $1.0 million. The  note, which bears no
interest  during  the  first  year  and  5%  thereafter,  would  be  payable  in
installments  of $120.0 thousand at the end  of each of the four years following
the closing date with the balance of  approximately $3.5 million due at the  end
of the fifth year following the closing date. The precise timetable for the sale
and  liquidation  of  the  remaining discontinued  operation,  the  cold storage
operations of  the refrigeration  business segment,  will depend  upon  SEPSCO's
ability to identify appropriate potential purchasers and to negotiate acceptable
terms  for the sale of such  operations. SEPSCO currently anticipates completion
of such sales by July 31, 1994.
 
     On July 22, 1993  SEPSCO's Board of Directors  also authorized the sale  or
liquidation  of the liquefied petroleum gas business. SEPSCO previously reported
the liquefied petroleum gas business as a discontinued operation since it is  to
be transferred to a subsidiary of Triarc and the transfer would be accounted for
at  net book value. The precise method  of such transfer has not been determined
and the transfer will not  occur until after the  Merger. Based on these  facts,
SEPSCO  has reevaluated the accounting for  the liquefied petroleum gas business
and retroactively  accounted  for the  liquefied  petroleum gas  business  as  a
continuing operation.
 
     SEPSCO  has $5.3 million  of restricted cash  and equivalents which support
letters of  credit  which  collateralize certain  performance  and  other  bonds
relating  to  the  utility  and  municipal  services  business  segment.  SEPSCO
anticipates that  subsequent to  the  closing of  the  sales of  the  operations
comprising  such segment, in  due course the buyers  will provide the collateral
for such bonds or that  the performance secured by  the bonds will be  completed
and  the restricted cash will revert to  SEPSCO free of restrictions and at that
time be used for general corporate purposes.
 
     SEPSCO had cash used  in operations of $2.0  million during the  nine-month
period ended November 30, 1993. SEPSCO anticipates its cash requirements for the
last  month of SEPSCO Transition 1993,  exclusive of operating activities, to be
insignificant. Such cash requirements  for the calendar  year 1994 will  include
$3.9  million of capital expenditures, of which SEPSCO intends to seek financing
from banks  and other  sources for  $3.2 million,  as well  as $9.0  million  of
sinking  fund payments on the 11 7/8%  Debentures. SEPSCO expects to meet all of
its cash requirements during  the last month of  SEPSCO Transition 1993 and  the
calendar  year 1994 with  the aforementioned financing  for capital expenditures
and its existing  cash balances principally  derived from the  sale of the  tree
maintenance services operations.
 
     In  1987  Graniteville was  notified  by the  South  Carolina DHEC  that it
discovered certain  contamination  of  Langley  Pond  near  Graniteville,  South
Carolina  and  DHEC  asserted  that  Graniteville  may  be  one  of  the parties
responsible for such contamination. Graniteville  entered into a consent  decree
providing  for  the study  and investigation  of the  alleged pollution  and its
sources. The study  report prepared by  Graniteville's environmental  consulting
firm  and filed with DHEC in April 1990, recommended that pond sediments be left
undisturbed and in place. DHEC responded by requesting
 
                                      119
 
<PAGE>
that Graniteville submit additional information concerning potential passive and
active remedial alternatives, with  accompanying supportive information. In  May
1991   Graniteville  provided   this  information  to   DHEC  in   a  report  of
Graniteville's  environmental  consulting  firm.  The  1990  and  1991   reports
concluded  that pond sediments should be left  undisturbed and in place and that
other less  passive  remediation  alternatives either  provided  no  significant
additional  benefits or themselves involved adverse  effects on human health, to
existing recreational uses or to the existing biological communities. Triarc  is
unable  to predict at this time what further actions, if any, may be required in
connection with Langley Pond or what the cost thereof may be. However, given the
passage of time since the submission of the two reports by DHEC and the  absence
of  desirable  remediation  alternatives,  other than  continuing  to  leave the
Langley Pond sediments  in place and  undisturbed as described  in the  reports,
SEPSCO  believes the ultimate  outcome of this  matter will not  have a material
adverse effect  on  SEPSCO's consolidated  results  of operations  or  financial
position.
 
     As a result of certain environmental audits in 1991, SEPSCO became aware of
possible  contamination by hydrocarbons and metals  at certain sites of SEPSCO's
refrigeration operations  and has  filed  appropriate notifications  with  state
environmental  authorities and has  begun a study of  remediation at such sites.
SEPSCO has  removed  certain underground  storage  and other  tanks  at  certain
facilities   of  its  refrigeration  operations   and  has  engaged  in  certain
remediation in connection therewith. Such removal and environmental  remediation
involved  a  variety  of remediation  actions  at various  facilities  of SEPSCO
located in a number of jurisdictions. Such remediation varied from site to site,
ranging from testing of soil  and groundwater for contamination, development  of
remediation  plans  and removal  in  certain instances  of  certain contaminated
soils. Based  on preliminary  information and  consultations with,  and  certain
reports of, environmental consultants and others, SEPSCO presently estimates the
cost  of such remediation  and/or removal will approximate  $3.7 million, all of
which was provided in prior years. In connection therewith, SEPSCO has  incurred
actual  costs through  November 30,  1993 of  $1.1 million  and has  a remaining
accrual of $2.6 million.  SEPSCO believes that after  such accrual the  ultimate
outcome  of this  matter will  not have  a material  adverse effect  on SEPSCO's
consolidated results of operations or financial position.
 
                                      120

<PAGE>
                              MANAGEMENT OF TRIARC
 
EXECUTIVE OFFICERS AND DIRECTORS OF TRIARC
 
     The  following table sets forth certain information regarding the directors
and executive officers of Triarc, all of whom are U.S. citizens.
 
<TABLE>
<CAPTION>
                    NAME                         AGE                     POSITIONS
- --------------------------------------------     ----   --------------------------------------------
<S>                                              <C>    <C>
Nelson Peltz................................       51   Director; Chairman and Chief Executive
                                                          Officer of Triarc
Peter W. May................................       51   Director; President and Chief Operating
                                                          Officer of Triarc
Leon Kalvaria...............................       35   Director; Vice Chairman of Triarc
Irving Mitchell Felt........................       84   Director
Harold E. Kelley............................       73   Director
Richard M. Kerger...........................       48   Director
Harold D. Kingsmore.........................       61   Director; President and Chief Executive
                                                          Officer of Graniteville
Daniel R. McCarthy..........................       69   Director
William L. Pallot...........................       81   Director
Thomas A. Prendergast.......................       60   Director
Martin Rosen................................       68   Director
Gerald Tsai, Jr. ...........................       65   Director
Stephen S. Weisglass........................       64   Director
John C. Carson..............................       47   President and Chief Executive Officer of RC
                                                          Cola
Ronald Paliughi.............................       50   President and Chief Executive Officer of
                                                          National Propane
Donald L. Pierce............................       49   President and Chief Executive Officer of
                                                          Arby's
Anthony W. Graziano, Jr. ...................       52   Executive Vice President and General
                                                          Counsel, and Assistant Secretary of Triarc
Joseph A. Levato............................       53   Executive Vice President and Chief Financial
                                                          Officer of Triarc
John L. Cohlan..............................       36   Senior Vice President -- Corporate Finance
Curtis S. Gimson............................       38   Senior Vice President and Associate General
                                                          Counsel, and Secretary of Triarc
Jerry Hostetter.............................       49   Senior Vice President -- Corporate
                                                          Communications
Francis T. McCarron.........................       36   Senior Vice President -- Taxes of Triarc
Fred H. Schaefer............................       49   Vice President and Chief Accounting Officer
                                                          of Triarc
</TABLE>
 
     Set forth below  is certain additional  information concerning the  persons
listed above.
 
     Nelson  Peltz  has been  a director  and  Chairman of  the Board  and Chief
Executive Officer of Triarc since  April 23, 1993. Since  April 23, 1993 he  has
also  been a director and  Chairman of the Board  and Chief Executive Officer of
certain of Triarc's subsidiaries, including SEPSCO and RC/Arby's. Mr. Peltz  has
also  been a director of  National Propane since April  23, 1993, and from April
23, 1993 until  January 1994 he  was a director  and Chairman of  the Board  and
Chief  Executive Officer of Wilson Brothers. He is also a general partner of DWG
Acquisition, whose principal business is ownership of securities of Triarc. From
its formation in January 1989  until April 23, 1993  Mr. Peltz was Chairman  and
Chief  Executive Officer  of Trian  Group, Limited  Partnership ('Trian'), which
provided investment banking and management  services for entities controlled  by
Mr.  Peltz and Mr.  May. From 1983 to  December 1988, he  was Chairman and Chief
Executive Officer  and a  director of  Triangle Industries,  Inc.  ('Triangle'),
which,  through wholly owned subsidiaries, was,  at that time, a manufacturer of
packaging products,  copper electrical  wire  and cable  and steel  conduit  and
currency and coin handling products. He was Chairman and Chief Executive Officer
and a director of Avery, Inc. ('Avery') from prior to
 
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<PAGE>
1987  until  October 1992.  Until  the October  1989  sale of  Uniroyal Chemical
Holding Company, Avery  was primarily  engaged in  the manufacture  and sale  of
specialty  chemicals.  From November  1989  through May  1992,  Mr. Peltz  was a
director of  Mountleigh Group  plc,  a British  property trading  and  retailing
company   for  which  administrative  receivers   were  appointed  in  May  1992
('Mountleigh'). He served in  various executive capacities, including  Executive
Chairman,  of Mountleigh from November 1989 until October 1991. He is a director
of Equitable  Bag Co.,  Inc.  ('Equitable Bag'),  a designer,  manufacturer  and
distributor of customized plastic and paper merchandise bags.
 
     Peter  W. May has been a director and President and Chief Operating Officer
of Triarc since April 23, 1993. Since April 23, 1993 he has also been a director
and President and Chief Operating  Officer of certain of Triarc's  subsidiaries,
including  SEPSCO and RC/Arby's.  Mr. May has  also been a  director of National
Propane since April 23, 1993, and from April 23, 1993 until January 1994 he  was
a  director and President and Chief Operating  Officer of Wilson Brothers. He is
also a general partner  of DWG Acquisition. From  its formation in January  1989
until  April 23,  1993, Mr.  May was  President and  Chief Operating  Officer of
Trian. He was President and Chief  Operating Officer and a director of  Triangle
from 1983 until December 1988. Mr. May was President and Chief Operating Officer
and  a director of  Avery from prior  to 1987 until  October 1992. From November
1989 through May 1992,  Mr. May was  a director of Mountleigh  and he served  as
Joint  Managing Director of Mountleigh from November 1989 until October 1991. He
is a director  of Equitable Bag.  On April 29,  1992, Mr. May  was also named  a
director of The Leslie Fay Companies, Inc. following its filing on April 5, 1993
for protection under Chapter 11 of the United States Bankruptcy Code.
 
     Leon  Kalvaria has been a director and  Vice Chairman of Triarc since April
23, 1993. Since April 23, 1993, he has also been a director and Vice Chairman of
certain of Triarc's subsidiaries, including  SEPSCO and RC/Arby's. Mr.  Kalvaria
has  also been  a director of  National Propane  since April 23,  1993, and from
April 23, 1993 until January 1994 he was a director and Vice Chairman of  Wilson
Brothers.  He joined Trian in  January 1991 and was  Vice Chairman of Trian from
April 1992 until April 23, 1993. He  is also a director of Equitable Bag.  Prior
to  joining Trian, Mr. Kalvaria  was employed by CS  First Boston, an investment
banking firm ('First Boston'), for more than 10 years. Mr. Kalvaria was Managing
Director of the Mergers and Acquisitions Department of First Boston from 1989 to
1991.
 
     Irving Mitchell Felt is a  private investor. He is  a Chairman of the  Felt
Foundation,  a philanthropic  organization. Since  1983, Mr.  Felt has  been the
Honorary  Chairman  of  the  Board   of  Directors  of  Madison  Square   Garden
Corporation,  an entertainment company, New York, New York, and prior thereto he
served as  President  and  Chairman  of  the  Board  of  Madison  Square  Garden
Corporation. Mr. Felt has been a director of Triarc since April 23, 1993.
 
     Harold  E. Kelley is an Attorney-At-Law  and a Certified Public Accountant.
Mr. Kelley has been a director of Triarc since March 1991.
 
     Richard M. Kerger is a  partner of Marshall & Melhorn,  a law firm. He  has
been a director of Triarc since March 1991.
 
     Harold  D.  Kingsmore has  been President  and  Chief Executive  Officer of
Graniteville since April 24,  1993. For more than  five years prior thereto,  he
was  Executive Vice President and Chief Operating Officer of Graniteville. He is
a director  of Palfed,  Inc., a  thrift institution.  Mr. Kingsmore  has been  a
director of Triarc since 1988.
 
     Daniel R. McCarthy is a Senior Partner of McCarthy & Lebit, Co., LPA, a law
firm.  Mr. McCarthy is also a director  of American Ship Building Company, which
is engaged in ship building and ship repairs. On November 4, 1993, American Ship
Building Company filed  for protection  under Chapter  11 of  the United  States
Bankruptcy Code. Mr. McCarthy has been a director of Triarc since March 1991.
 
     William  L. Pallot is retired Chairman of  the Board of Royal Trust Bank of
Miami, N.A., Miami, Florida (Chairman 1972 - 1984). Mr. Pallot was a director of
SEPSCO until March 1992. He was a  director of Triarc from 1966 to December  27,
1991 and has been a director of Triarc from April 23, 1993 to date.
 
     Thomas  A.  Prendergast  is a  private  investor. From  January  1983 until
December 1988, he was Chairman of the Board of Air Cargo Equipment  Corporation,
a  manufacturer of  aircraft cargo containers.  From April  1989 through October
1991, he  was  Chairman of  the  Board of  Cliniteck,  Inc., a  manufacturer  of
disposable  hospital products. Mr. Prendergast is  also Chairman of the Board of
The
 
                                      122
 
<PAGE>
Steel Corporation of Texas, a seller of  steel mill products. He was a  director
of  Triarc from 1979 to December 27, 1991 and has been a director of Triarc from
April 23, 1993 to date.
 
     Martin Rosen is senior partner of the law firm of Rosen & Reade, New  York,
New  York, which for many years has served as counsel to Triarc. He was director
of Triarc  for more  than five  years  prior to  November 1986  and has  been  a
director of Triarc since April 23, 1993.
 
     Gerald  Tsai, Jr. is a  private investor. Since February  1993, he has been
Chairman of  the Board,  President and  Chief Executive  Officer of  Delta  Life
Corporation,  a life insurance company with  which Mr. Tsai became associated in
1992. From 1982 until  December 1988, Mr. Tsai  served Primerica Corporation  in
various  executive  capacities, including  as Chairman  of  the Board  and Chief
Executive Officer  from 1987  until December  1988. Mr.  Tsai also  serves as  a
director  of Palm Beach  National Bank and  Trust Company, Rite-Aid Corporation,
Sequa Corporation, Zenith National Insurance Corporation and Proffitt's Inc.  He
is  a trustee  of MediTrust, Boston  University and New  York University Medical
Center. Mr. Tsai has been a director of Triarc since October 1993.
 
     Stephen S. Weisglass has  been Chairman of  Equity Research Associates,  an
investment  research  firm,  since 1991.  During  1990, Mr.  Weisglass  was Vice
Chairman of Whale Securities, a broker-dealer firm. Prior thereto, Mr. Weisglass
was associated with Ladenburg, Thalmann, an investment banking firm, in  various
capacities  for  more than  15 years,  including  President and  Chief Executive
Officer from 1979 until 1990. He has  been a director of Triarc since April  23,
1993.
 
     John  C. Carson has been  President and Chief Executive  Officer of RC Cola
since April  24,  1993. Prior  thereto,  Mr.  Carson was  President  of  Cadbury
Beverages,  North America, a subsidiary of  Cadbury Schweppes, PLC, where he was
also a member  of Cadbury Beverages  Global Board. Mr.  Carson was president  of
Schweppes  NA  from 1984  to  1988, vice  president  of sales  and  marketing of
Schweppes Bottling U.K. and Cadbury U.K. from 1964 to 1981.
 
     Ronald Paliughi has been President and Chief Executive Officer of  National
Propane  since April 24, 1993. He was engaged in private research and consulting
services from 1992 until April 1993. During  1991, he served as a United  States
Army  Officer in  Operation Desert  Storm. From 1987  to 1990,  Mr. Paliughi was
Senior Vice President -- Western Operations of AP Propane (AmeriGas), one of the
largest LP  gas  companies  in  the  United  States  and  a  subsidiary  of  UGI
Corporation.  During 1986,  Mr. Paliughi  was director  of retail  operations of
CalGas Corporation, a division of Dillingham corporation, the fourth largest  LP
gas  company in the United  States and for more than  14 years prior thereto, he
held  various  positions  with  Vangas,  Inc.,  last  serving  as  Senior   Vice
President -- General Manager.
 
     Donald  L. Pierce has been President  and Chief Executive Officer of Arby's
since April 24, 1993. Prior thereto, Mr. Pierce was President of Pepsico, Inc.'s
Hot   'n   Now    hamburger   chain    and   President    of   Kentucky    Fried
Chicken  -- International. From 1987 to 1988  Mr. Pierce was President and Chief
Operating Officer of Denny's, and from 1981 to 1987 he served Denny's in various
executive capacities, including Group Vice President, President of the El  Pollo
Loco  division, and Vice  President, Finance. From  1969 to 1981  Mr. Pierce was
with American Hospital Supply,  Inc. where he held  positions in finance,  sales
and operations.
 
     Anthony  W. Graziano,  Jr. has  been Executive  Vice President  and General
Counsel and Assistant Secretary of Triarc since April 24, 1993. He has also been
Executive Vice President and General Counsel and Assistant Secretary of  certain
of  Triarc's subsidiaries, including SEPSCO and RC/Arby's, since April 24, 1993.
Prior thereto, he was Senior Vice President  -- Legal Affairs of Trian from  its
formation  in January 1989 until April 24, 1993. He joined Triangle in September
1985 and served  as Senior  Vice President --  Legal Affairs  of Triangle  until
January  1989 and as Senior  Vice President -- Legal  Affairs of Avery from 1986
until 1992.
 
     Joseph A.  Levato has  been Executive  Vice President  and Chief  Financial
Officer  of  Triarc  since April  24,  1993.  He has  also  been  Executive Vice
President and  Chief  Financial Officer  of  certain of  Triarc's  subsidiaries,
including  SEPSCO and  RC/Arby's, since  April 24,  1993. Prior  thereto, he was
Senior Vice President  and Chief Financial  Officer of Trian  from January  1992
until  April  24, 1993.  From 1984  to January  1989, he  served as  Senior Vice
President and Chief  Financial Officer  of Triangle  and served  as Senior  Vice
President and Chief Financial Officer of Avery from 1986 until 1989.
 
     John  L.  Cohlan has  been Senior  Vice President  -- Corporate  Finance of
Triarc since January, 1994. He has also been Senior Vice President --  Corporate
Finance  of certain  of Triarc's  subsidiaries, including  SEPSCO and RC/Arby's,
since January 1994.  Prior thereto, he  had served as  Senior Vice President  --
 
                                      123
 
<PAGE>
Corporate  Development of  Triarc and  such subsidiaries  since April  24, 1993.
Before joining Triarc, he was  a Senior Vice President  of Trian from July  1992
until  April  24,  1993.  From  January 1992  until  May  1992,  Mr.  Cohlan was
associated with Mountleigh.  From 1989  until 1991, he  was a  principal of  The
Palmer   Group,  Inc.,   a  firm   specializing  in   corporate  restructurings,
particularly in the hotel  industry. From 1987 until  1989, Mr. Cohlan was  Vice
President  -- New  Business Development  of VMS  Realty Partners,  a real estate
concern.
 
     Curtis S.  Gimson has  been  Senior Vice  President and  Associate  General
Counsel  and Secretary of Triarc  since April 24, 1993.  He has also been Senior
Vice President  and  Associate  General  Counsel and  Secretary  of  certain  of
Triarc's subsidiaries, including SEPSCO and RC/Arby's, since April 24, 1993. Mr.
Gimson  has also been Secretary of National  Propane since April 24, 1993. Prior
thereto, he was  Senior Vice President  and Associate General  Counsel of  Trian
from  its formation in January 1989 until  April 24, 1993. He joined Triangle in
December 1984 and  served as  Vice President  and Associate  General Counsel  of
Triangle  until January  1989 and  served as  Senior Vice  President and General
Counsel of Avery from 1986 until 1992.
 
     Jerry Hostetter has been Senior Vice President -- Corporate  Communications
of   Triarc  since   September  28,   1993.  He   has  also   been  Senior  Vice
President --  Corporate  Communications  of certain  of  Triarc's  subsidiaries,
including  SEPSCO and RC/Arby's, since September 28, 1993. Prior thereto, he was
Vice President, Investor Relations and Communications for Varity Corporation,  a
manufacturer  of farm equipment, from June 1992 until September 1993. From March
1989 until  May 1992,  Mr.  Hostetter established  and  ran a  public  relations
consulting  firm.  From  1986  until  1989,  he  was  Vice  President, Corporate
Communications  of  Triangle.  He  also  served  as  Vice  President,  Corporate
Communications of Avery from 1986 to 1989.
 
     Francis T. McCarron has been Senior Vice President -- Taxes of Triarc since
April  24, 1993. He has  also been Senior Vice President  -- Taxes of certain of
Triarc's subsidiaries, including SEPSCO,  RC/Arby's and National Propane,  since
April  24, 1993. Prior thereto, he was Vice President -- Taxes of Trian from its
formation in January 1989 until April  24, 1993. He joined Triangle in  February
1987  and served as Director  of Tax Planning &  Research until January 1989. He
also served as Vice President -- Taxes of Avery from 1989 until 1992.
 
     Fred H. Schaefer has  been Vice President and  Chief Accounting Officer  of
Triarc  since  April  24,  1993.  He has  also  been  Vice  President  and Chief
Accounting Officer  of  certain  of  Triarc's  subsidiaries,  including  SEPSCO,
RC/Arby's and National Propane, since April 24, 1993. Prior thereto, he was Vice
President  and Chief Accounting  Officer of Trian from  its formation in January
1989 until April 24, 1993.  Mr. Schaefer joined Triangle  in 1980 and served  in
various    capacities   in    the   accounting    department,   including   Vice
President   --   Financial,   until   January   1989   and   served   as    Vice
President -- Financial Reporting of Avery from 1986 until 1992.
 
     Each  director was elected  or reelected, as  the case may  be, at the most
recent annual meeting of shareholders of  Triarc, which was held on October  27,
1993.  Each director has been elected to  serve until the next annual meeting of
Triarc shareholders and  until his  successor is  duly chosen  and qualified  or
until his prior death, resignation or removal.
 
     The  term of office  of each executive officer  is until the organizational
meeting of  the  Triarc  Board  following the  next  annual  meeting  of  Triarc
shareholders and until his successor is elected and qualified or until his prior
death, resignation or removal.
 
CERTAIN ARRANGEMENTS AND UNDERTAKINGS RELATING TO
THE COMPOSITION OF TRIARC'S BOARD OF DIRECTORS
 
     The Stock Purchase Agreement entered into by DWG Acquisition and the Posner
Entities  (the 'Stock Purchase Agreement') in connection with the Reorganization
provides that as long as the Posner Entities and entities controlled by them, in
the aggregate, are beneficial owners of equity securities of Triarc representing
or convertible  into  more  than one-half  of  one  percent of  the  issued  and
outstanding Triarc common stock, DWG Acquisition (a) will not vote its shares in
favor of a director (other than Daniel R. McCarthy, Richard M. Kerger and Harold
E. Kelley (the 'Court Appointed Directors'), who were designated as directors by
the  Ohio Court in 1991) who knowingly causes  Triarc to breach or vote in favor
of any  action that  would constitute  a breach  of Triarc's  obligations  under
certain  transactions  entered  into  between  the  Posner  Entities  and  their
affiliates, on the one hand, and Triarc  and its affiliates, on the other  hand,
(b)    will,   in   the   event   either   Steven   Posner   or   Martin   Rosen
 
                                      124
 
<PAGE>
ceases to be a director of Triarc,  vote its shares in favor of any  appropriate
person  nominated by Steven Posner  (other than Victor Posner  or certain of his
family members) to fill such vacancy and (c) until the earlier of (x) April  23,
1998  and (y) the date  on which Posner Entities  cease to own beneficially more
than 50% of the shares of Redeemable Convertible Preferred Stock issued to it in
the Reorganization (or shares of Triarc common stock into which such  Redeemable
Convertible  Preferred Stock may be converted),  will, in the event that Russell
Boyle (who no longer serves as a director), H. Douglas Kingsmore, William Pallot
or Thomas Prendergast or their successors cease to be a director of Triarc, vote
its shares to fill such vacancy in favor of any person (other than Victor Posner
or certain of his family members) acceptable to both DWG Acquisition and  Steven
Posner.
 
     In  addition, in connection with the  Modification entered into on February
17, 1993 in connection with the settlement of the Granada, Brilliant and  Cameon
cases, DWG Acquisition and Messrs. Peltz and May entered into an Undertaking and
Agreement,  dated February  9, 1993 (the  'Undertaking'), pursuant  to which DWG
Acquisition and Messrs. Peltz and May  agreed to be bound by certain  provisions
of  the Modification,  including (a)  never to vote  any shares  of Triarc stock
owned or controlled by DWG  Acquisition for the election  of Victor Posner as  a
director  of Triarc, (b)  causing any slate  of directors of  Triarc directly or
indirectly proposed or  recommended by  DWG Acquisition during  the period  (the
'Effective  Period') terminating on the earliest of (i) April 23, 1998, (ii) the
date on which Victor Posner (and his affiliates) ceases to own shares of  Triarc
common  stock or  Triarc convertible securities  equal in the  aggregate to more
than 5.0% of the issued and outstanding  Triarc common stock and (iii) the  date
on which the shares of Triarc common stock cease to be publicly held, to include
the  Court Appointed Directors  and (c) during the  Effective Period, subject to
DWG Acquisition's absolute right to vote the minimum number of shares  necessary
to  accomplish the election  of Messrs. Peltz,  May and Kalvaria  and Mr. Irving
Mitchell Felt, or their successors, to cast any other votes available to it  for
the  election of the Court  Appointed Directors (if the  shares of Triarc common
stock are subject to cumulative voting, DWG Acquisition is obligated to cumulate
its votes and to vote as described in this clause (c)).
 
INFORMATION REGARDING CERTAIN COMMITTEES OF THE TRIARC BOARD
 
     The  Triarc  Board  has   standing  audit,  nominating,  and   compensation
committees whose current functions and members are described below.
 
     Audit  Committee.  The Audit  Committee is  composed  of Messrs.  Daniel R.
McCarthy (Chairman), Irving  Mitchell Felt,  Martin Rosen and  Gerald Tsai,  Jr.
This  Committee is charged  with the responsibility of  satisfying itself of the
propriety and accuracy  of the  financial statements of  Triarc and  any of  its
subsidiaries  which have publicly-owned securities.  In the course of performing
its functions  the  Audit Committee  (i)  reviews Triarc's  internal  accounting
controls  and its  annual consolidated  financial statements,  (ii) reviews with
Triarc's independent  certified public  accountants the  scope of  their  audit,
their  report and their recommendations, (iii)  considers the possible effect on
the independence of such accountants  in approving non-audit services  requested
of  them,  and  (iv) recommends  the  action to  be  taken with  respect  to the
appointment of Triarc's independent certified public accountants.
 
     Nominating Committee. The Nominating Committee is composed of Messrs. Peter
W. May (Chairman),  Harold E.  Kelley, Nelson Peltz  and Gerald  Tsai, Jr.  This
Committee  is charged  with the  responsibility of  considering and recommending
individuals to be considered  by the Triarc Board  for membership on the  Triarc
Board.  The  Nominating Committee  will  consider nominations  for  Triarc Board
membership by shareholders. The Nominating  Committee has adopted the  following
rules   with  respect  to  considering  such  nominations:  (i)  the  nominating
shareholder must have  owned shares of  Triarc common stock  or preferred  stock
(entitled  to vote for Directors) for at least  six months prior to the date the
nomination is submitted; (ii) the nomination must be received by the  Nominating
Committee  120 days before the mailing date for proxy material applicable to the
annual meeting for which such nomintion is proposed for submission; and (iii)  a
detailed  statement setting  forth the  qualifications, as  well as  the written
consent, of each party nominated must accompany each nomination submitted.
 
     Compensation Committee. The Compensation  Committee is composed of  Messrs.
Irving  Mitchell Felt  (Chairman), William  L. Pallot  and Gerald  Tsai, Jr. The
Committee is  charged with  the responsibility  of (i)  reviewing, advising  and
making  recommendations with respect to  employee salary and compensation plans,
benefits and standards, (ii)  taking such action with  respect thereto that  are
not
 
                                      125
 
<PAGE>
reserved   to  the  Triarc  Board,   and  (iii)  administering  Triarc's  Equity
Participation Plan and such other salary or compensation plans as the  Committee
is designated to administer.
 
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
 

     Mr.  Martin Rosen,  who served  as a  member of  the Compensation Committee
until October 1993, is a member of the law firm of Rosen & Reade. During  Fiscal
1993  and  Transition  1993,  the  Company  paid  Rosen  &  Reade  approximately
$1,744,000 and  approximately  $1,127,000,  respectively, on  account  of  legal
services rendered to the Triarc Companies.

 
COMPENSATION OF DIRECTORS
 
     Since  the Reorganization, each non-management  director of Triarc receives
an annual retainer  of $25,000  for serving on  the Triarc  Board. In  addition,
non-management directors of Triarc receive $1,000 for each meeting of the Triarc
Board  or of  a Committee  of the Triarc  Board attended.  See 'TRIARC EXECUTIVE
COMPENSATION'  for  certain  information  relating  to  compensation  of  Triarc
management directors.
 
     In  addition, pursuant to  the Equity Participation  Plan, each director of
Triarc who is not then an employee of Triarc or any subsidiary receives, on  the
later of (i) the date of his initial election or appointment to the Triarc Board
and  (ii) April  24, 1993, options  to purchase  3,000 shares of  Triarc Class A
Common Stock  and, in  connection therewith,  tandem stock  appreciation  rights
('SARs')  for the same number  of shares. On the  date of each subsequent annual
meeting of  shareholders  of Triarc  at  which  a director  is  reelected,  such
director  will receive options to purchase 1,000 shares of Triarc Class A Common
Stock and, in  connection therewith, SARs  for the same  number of shares.  Each
such  option has a term of ten  years, subject to certain exceptions provided in
the Equity  Participation Plan.  Each  such option  becomes exercisable  to  the
extent   of  one-half  thereof  on  each   of  the  two  immediately  succeeding
anniversaries of the date of grant. The price per share to be paid by the holder
of such an option is equal to the fair market value of one share of Triarc Class
A Common Stock  on the date  the option is  granted. The purchase  price of  the
shares  of Triarc Class A  Common Stock as to which  such an option is exercised
shall be paid only in cash, and  such SARs shall be exercisable only for  shares
of Triarc Class A Common Stock.
 
     Subsequent to the Reorganization, the Triarc Board approved and Triarc paid
a cash payment to each of the members of the Triarc Special Committee in respect
to  their  services  to  Triarc  (principally  in  relationship  to  the settled
litigation which had been pending in the  Ohio Court) through April 23, 1993  as
follows: $2,200,000 to Mr. Kelley, $1,300,000 to Mr. McCarthy, $1,000,000 to Mr.
Kerger  and $200,000 to each of Messrs. Pallot and Prendergast. In addition, the
Compensation Committee of the Triarc Board, on the recommendation of the  Triarc
Board,  granted restricted stock  awards to Messrs.  Kelley, McCarthy and Kerger
with respect to 60,000, 60,000 and 30,000 shares of Triarc Class A Common Stock,
respectively. The grant of  restricted stock awards was  pursuant to the  Equity
Participation  Plan and such  awards will vest  in full and  all restrictions on
transferability shall terminate on the earlier of December 31, 1996 or the  date
the  individual ceases to be a director  of Triarc, unless the individual ceases
to be a director as a result of his voluntary resignation or his decision not to
stand for reelection  or as a  result of his  directorship being terminated  for
cause in accordance with the Ohio General Corporation Law.
 
                                      126

<PAGE>
                         TRIARC EXECUTIVE COMPENSATION
 
COMPENSATION OF NEW EXECUTIVE OFFICERS
 

     Just prior to the end of Fiscal 1993, a new chief executive officer as well
as  other new executive officers  of Triarc were elected  in connection with the
Reorganization  which  was   consummated  on  April   23,  1993.  See   'SPECIAL
FACTORS   --  Background  to   the  Merger;  Reasons  for   the  Merger  --  The
Reorganization and Related  Matters.' At  the same time,  Triarc's former  chief
executive  officer and all other executive  officers of Triarc, except Harold D.
Kingsmore and  Jack Coppersmith,  ceased  to be  executive officers  of  Triarc.
Accordingly, during Fiscal 1993 neither Triarc's new chief executive officer nor
any  of its other new executive officers  received any material amount of salary
from the  Triarc Companies.  Therefore,  the only  information with  respect  to
annual  salaries for Fiscal 1993 set forth  in the Summary Compensation Table is
presented with  respect  to  Messrs.  Kingsmore  and  Coppersmith.  The  Summary
Compensation  Table does set  forth cash bonuses  awarded to certain  of the new
executive officers  at  the  time  they  accepted  employment  with  the  Triarc
Companies  and in respect of performance during 1993, as well as non-cash awards
under the Equity Participation Plan to Triarc's new chief executive officer  and
to  four of the other new executive  officers of Triarc who constituted Triarc's
four most highly  compensated executive officers  (the 'Named Officers')  during
Transition  1993.  Additional  information  with  respect  to  the  compensation
arrangements for the new chief executive officer and the Named Officers, as well
as  for  Messrs.   Kingsmore  and   Coppersmith,  are   described  below   under
' -- Employment Arrangements with Executive Officers.'

 
SUMMARY COMPENSATION TABLE
 

<TABLE>
<CAPTION>
                                                                                           LONG TERM COMPENSATION
                                                                                       ------------------------------
                                                                                               AWARDS
                                                                                       ---------------------- PAYOUTS
                                                                                                              -------
                                          ANNUAL COMPENSATION             (E)             (F)                             (I)
                (A)                  -----------------------------    ------------     ----------      (G)      (H)   ------------
- ------------------------------------                                     OTHER         RESTRICTED    -------- -------     ALL
              NAME AND                  (B)       (C)       (D)          ANNUAL          STOCK       OPTIONS/  LTIP      OTHER
             PRINCIPAL               --------- --------- ---------    COMPENSATION      AWARD(S)       SARS   PAYOUTS COMPENSATION
              POSITION               PERIOD(1) SALARY($) BONUS($)        ($)(2)           (#)         (#)(6)    ($)       ($)
- ------------------------------------ --------- --------- ---------    ------------     ----------    -------- ------- ------------
<S>                                  <C>       <C>       <C>          <C>              <C>           <C>      <C>     <C>
Nelson Peltz(3) ....................       TP          1    --            --             --            75,000   --        --
  Chairman of the Board and Chief        1993     --        --            --             --           600,000   --        --
  Executive Officer of Triarc
Peter W. May(3) ....................       TP          1    --            --             --            50,000   --        --
  President and Chief Operating          1993     --        --            --             --           400,000   --        --
  Officer of Triarc
Leon Kalvaria ......................       TP    333,336   550,000       520,181  (10)  12,500   (6)   40,000   --        --
  Vice Chairman of                       1993     --       800,000(4)     --            30,000   (6)  150,000   --        --
  Triarc
John C. Carson .....................       TP    322,436   250,000       123,626  (11)   7,500   (6)   30,000   --        --
  President and Chief Executive          1993     --     1,000,000(5)     --            37,500   (6)  120,000   --        --
  Officer of Royal Crown Company,
  Inc.
Harold D. Kingsmore ................       TP    266,666   450,000        --             --            10,000   --        --
  President and Chief Executive          1993    300,000 1,300,000                (7)   50,000   (6)   50,000   --        --
  Officer of Graniteville Company        1992    300,000   700,000                (7)    --             --      --    11,903(8)
                                         1991    300,000   750,000                (7)    --             --      --        --
Donald L. Pierce ...................       TP    218,750   175,000       346,797  (12)   6,250   (6)   35,000   --        --
  President and Chief Executive          1993     --       500,000(5)     --            55,000   (6)   65,000   --        --
  Officer of Arby's, Inc.
Jack Coppersmith(9) ................       TP     61,151    --            --             --             --      --        --
  Executive Vice                         1993    236,715   350,000                (7)    --            25,000   --        --
  President -- Operations of SEPSCO      1992    241,360   120,000                (7)    --             --      --        --
                                         1991    248,000    --                    (7)    --             --      --        --
</TABLE>

 
                                                        (footnotes on next page)
 
                                      127
 
<PAGE>
(footnotes from previous page)
 
 (1) Information  set forth opposite the letter 'TP' relates to Transition 1993,
     while information set forth opposite 1993,  1992 or 1991 relates to  Fiscal
     1993, Fiscal 1992 or Fiscal 1991, respectively.
 
 (2) Information  in this column is set forth in accordance with the regulations
     of the Securities and Exchange Commission only for Transition 1993,  Fiscal
     1993 and Fiscal 1992.
 
 (3) Did not receive any amount of compensation, except as set forth under 'Long
     Term Compensation -- Awards' during the periods reported.
 
 (4) Discretionary  bonus awarded April 24, 1993 in respect of services rendered
     in connection  with  the  Refinancing and  Reorganization  of  Triarc.  See
     ' -- Employment Arrangements with Executive Officers,' below.
 
 (5) One-time  bonus pursuant to an  employment agreement entered into effective
     April 24, 1993. See ' -- Employment Arrangements with Executive  Officers,'
     below.
 

 (6) All  restricted stock awards and stock  option grants were made pursuant to
     the Equity Participation  Plan. The restricted  stock awards are  described
     under  '  -- Employment  Arrangements with  Executive Officers'  below. The
     option  grants  made   during  Fiscal  1993   are  described  below   under
     '  -- Option/SAR Grants in Respect of Fiscal 1993 and Transition 1993.' The
     option grants reported in the table for Transition 1993 were made on  March
     1,  1994 in respect of performance during Transition 1993. All such options
     have an exercise price of $21.00 per share, which was the closing price  of
     Triarc  Class A Common Stock on the NYSE on March 1, 1994. All such options
     expire March 1, 2004. The options for Messrs. Peltz, May and Kalvaria  vest
     as  follows: one third  of the options  granted vest on  each of the first,
     second and  third anniversaries  of  the date  of  grant. The  options  for
     Messrs.  Carson, Kingsmore  and Pierce  vest as  follows: one  third of the
     options granted vest on each of  the third, fourth and fifth  anniversaries
     of the date of grant. Prior to adoption of the Equity Participation Plan in
     April  1993, Triarc's executive compensation program did not include grants
     of restricted stock awards.

 

 (7)  Perquisites or other personal benefits did not exceed the lesser of either
      $50,000 or 10% of  the total annual salary  and bonus reported in  columns
      (c) and (d).

 

 (8)  Represents distributions under the Graniteville Company Retirement Savings
      Plan.


 (9)  Mr.  Coppersmith resigned as an officer  and employee effective August 10,
      1993.


(10)  Includes $519,323 relating to Mr. Kalvaria's relocation to South Florida.


(11)  Includes $121,422 relating to Mr. Carson's relocation to South Florida.


(12)  Includes $345,289 relating to Mr. Pierce's relocation to South Florida.

 
EMPLOYMENT ARRANGEMENTS WITH EXECUTIVE OFFICERS
 
NELSON PELTZ AND PETER W. MAY
 
     Since the Reorganization, Nelson Peltz and  Peter W. May have been  serving
Triarc  as its Chairman and Chief Executive  Officer and its President and Chief
Operating Officer,  respectively, and  each of  them currently  is receiving  an
annual  base salary of $1.00. In addition,  Messrs. Peltz and May participate in
the incentive  compensation and  welfare  and benefit  plans made  available  to
Triarc's  corporate officers, including the  Equity Participation Plan described
below.
 
LEON KALVARIA
 
     Since the Reorganization, Leon Kalvaria has been serving Triarc as its Vice
Chairman and  is currently  receiving an  annual base  salary of  $500,000.  Mr.
Kalvaria  also received  a bonus of  $800,000 in  Fiscal 1993 in  respect of his
services in connection with the Reorganization. Effective November 1, 1993,  Mr.
Kalvaria entered into an employment agreement with Triarc having an initial term
which  expires  on  December  31,  1996  but  which  automatically  extends  for
successive three year periods on January  1 of each year, commencing January  1,
1995,  unless, not later than one year preceding the date of any such extension,
either party  notifies the  other that  it does  not wish  to have  the term  so
extended. The employment agreement provides for an annual salary of $500,000. In
addition, the agreement provides that Mr. Kalvaria will be entitled to receive a
bonus  payment in each full calendar year  of the agreement, commencing in 1994,
in  an  amount  not  less  than  the  amount  by  which  the  salary  and  other
 
                                      128
 
<PAGE>
cash  payments made to him  during such year pursuant to  any long or short term
management incentive plan  is less  than $800,000. The  agreement also  provides
that  if  Mr.  Kalvaria  dies  during  the  term  of  the  agreement,  his legal
representative will be entitled to receive  from Triarc an amount calculated  at
an annual rate of $800,000 for the remaining term of the agreement if Triarc had
been  able to procure,  at a reasonable  rate, term insurance  on Mr. Kalvaria's
life to pay such  obligation, or, if  Triarc had not been  able to procure  such
insurance,  an amount calculated  at the annual  rate of $800,000  for the three
month period following Mr. Kalvaria's death. Triarc has obtained such  insurance
to  fund  this obligation  for the  next seven  years for  an annual  premium of
approximately $3,000. The agreement also provides that if Triarc terminates  the
agreement as a result of Mr. Kalvaria becoming disabled, Triarc will continue to
pay  Mr. Kalvaria at  the annual rate  of $800,000 for  an eighteen month period
following such termination.
 
     Triarc and  Mr.  Kalvaria are  parties  to an  agreement  (the  'Relocation
Agreement') pursuant to which Mr. Kalvaria relocated to Florida in order to work
in  the West Palm Beach  office. Mr. Kalvaria owns  a cooperative apartment (the
'Apartment'), and because relocation companies, including the relocation company
retained by Triarc, typically do not handle the sale of cooperative  apartments,
the  Relocation Agreement is designed to place Mr. Kalvaria in the same position
he would have occupied if he had sold the Apartment through a relocation company
at an appraised  value of $3.5  million. Accordingly, in  addition to  providing
certain  standard  relocation benefits,  pursuant  to the  Relocation Agreement,
Triarc guaranteed a $3 million  bank loan (the 'Bank  Loan') secured by a  first
mortgage  on Mr. Kalvaria's new Florida  residence (the 'Florida Property'), and
Triarc made loans aggregating  $500,000 to Mr. Kalvaria  in connection with  his
purchase  of the Florida  Property. The Bank  Loan bears interest  at 6 1/2% per
annum, has  a  15-year  amortization  schedule, and  matures  in  5  years.  The
Relocation  Agreement provides that  when Mr. Kalvaria  sells the Apartment, the
net proceeds  will be  used to  reduce  the principal  on the  Bank Loan  to  $1
million,  at which time  Triarc's guarantee will  be released. Additionally, any
excess net proceeds from the  sale of the Apartment will  be used to reduce  the
principal  of the Triarc loans. To the extent  that the net proceeds of the sale
of the Apartment are insufficient to reduce the principal on the Bank Loan to $1
million, Triarc will make additional loans to Mr. Kalvaria which will be used to
reduce the principal  on the  Bank Loan  to $1  million. The  Triarc loans  bear
interest  at the higher of  6 1/2% per annum or  the applicable federal rate for
medium term loans  with interest  payable annually  and mature  on December  31,
1996.
 
JOHN C. CARSON
 
     On  April 24, 1993, Triarc and RC Cola entered into an employment agreement
with John  C.  Carson (the  'Carson  Employment Agreement')  providing  for  the
employment  of Mr. Carson as  President and Chief Executive  Officer of RC Cola.
Mr. Carson's  term  of full-time  employment  began on  May  10, 1993  and  will
continue  (unless  otherwise terminated  as  provided in  the  Carson Employment
Agreement) until December 31, 1996, subject to automatic renewal for  successive
two-year  periods unless  either RC  Cola or Mr.  Carson elects,  upon 180 days'
notice, not to renew.
 

     Pursuant to the  Carson Employment  Agreement, Mr. Carson  will receive  an
annual  base salary of $500,000. Upon  the Reorganization, Mr. Carson received a
one-time bonus of  $1,000,000 and  37,500 restricted  shares of  Triarc Class  A
Common  Stock and options  to purchase 120,000  shares of Triarc  Class A Common
Stock at an exercise price  of $18.00 per share.  The $18.00 exercise price  was
equal  to the closing  price of the  Triarc Class A  Common Stock on  the ASE on
April 27, 1993, the  first day of  trading after the  options were granted.  The
options  and  restricted  stock  awards  were  granted  pursuant  to  the Equity
Participation Plan. Mr. Carson also will  be eligible to receive an annual  cash
incentive  bonus under RC Cola's proposed  annual cash incentive plan (described
below), additional compensation  pursuant to  the Equity  Plan and  compensation
under RC Cola's proposed mid-term cash incentive plan (described below). For the
1994  calendar year, the  sum of Mr.  Carson's salary and  annual cash incentive
bonus will  be  at least  $800,000.  Mr. Carson's  annual  base salary  will  be
reviewed  annually  for possible  increase, but  not decrease,  by the  Board of
Directors of RC Cola.

 
     Should RC  Cola elect  to terminate  Mr. Carson's  employment without  good
cause, the agreement provides that he will receive a special payment of $800,000
in addition to base salary through the end of the month in which the termination
occurs  and accrued bonuses  and compensation under  RC Cola's proposed mid-term
cash incentive plan. The Carson Employment Agreement provides that, in the event
of a change in control of RC Cola or any parent of RC Cola, Mr. Carson would  be
obligated to continue
 
                                      129
 
<PAGE>
in  employment under the Carson Employment Agreement until the first anniversary
of such change in control, after which he  would have the right to resign as  an
officer  and employee of RC Cola and to  receive the same payments that he would
have been entitled  to receive  had his employment  been terminated  by RC  Cola
without good cause.
 
HAROLD D. KINGSMORE
 
     On  April 24, 1993,  Graniteville, and Harold D.  Kingsmore entered into an
employment agreement (the  'Kingsmore Employment Agreement')  providing for  Mr.
Kingsmore's employment as President and Chief Executive Officer of Graniteville.
The  term  of the  agreement commenced  May  1, 1993  and will  continue (unless
otherwise terminated as  provided in the  Kingsmore Employment Agreement)  until
December  31,  1996, subject  to renewal  for an  additional three  years unless
either party notifies the other that it does not wish to renew.
 
     Pursuant to the Kingsmore Employment Agreement, Mr. Kingsmore will  receive
an annual base salary of $400,000. Mr. Kingsmore also received 50,000 restricted
shares of Triarc Class A Common Stock and an option to purchase 50,000 shares of
Triarc Class A Common Stock at an exercise price of $18.00 per share pursuant to
the Equity Participation Plan. Mr. Kingsmore also will be eligible to receive an
annual  cash incentive bonus under Graniteville's proposed annual cash incentive
plan  (described  below),  additional   compensation  pursuant  to  the   Equity
Participation  Plan and compensation under Graniteville's proposed mid-term cash
incentive  plan  (described  below).  To   compensate  for  the  fact  that   no
distribution  will be made under the mid-term plan until completion of the first
three year performance cycle, Mr. Kingsmore will receive cash compensation of at
least $850,000  with  respect to  his  services  during fiscal  1994  and  1995,
exclusive of any accrual with respect to such years under the mid-term plan. Mr.
Kingsmore's  annual base salary will be reviewed annually for possible increase,
but not decrease, by Graniteville's Board of Directors.
 
DONALD L. PIERCE
 
     On April 24, 1993, Arby's entered into an employment agreement with  Donald
L.  Pierce (the 'Pierce Employment Agreement,'  and collectively with the Carson
Employment Agreement  and the  Kingsmore Employment  Agreement, the  'Employment
Agreements')  providing  for  Mr.  Pierce's employment  as  President  and Chief
Executive Officer of Arby's.  The term of Mr.  Pierce's employment commenced  in
May  1993  and will  continue (unless  otherwise terminated  as provided  in the
Pierce Employment Agreement) until December 31, 1996, subject to renewal for  an
additional  three years unless either party notifies  the other that it does not
wish to renew.
 
     Pursuant to the  Pierce Employment  Agreement, Mr. Pierce  will receive  an
annual  base salary of $350,000. On the commencement date of his employment, Mr.
Pierce received a one-time bonus of $500,000, 55,000 restricted shares of Triarc
Class A Common Stock and an option  to purchase 65,000 shares of Triarc Class  A
Common  Stock, at  an exercise  price of $18.00  per share.  The $18.00 exercise
price was equal to the closing price of  Triarc Class A Common Stock on the  ASE
on  April 27, 1993, the first day of trading after the options were granted. Mr.
Pierce also will  be eligible to  receive an annual  cash incentive bonus  under
Arby's  proposed  annual  cash  incentive  plan  (described  below),  additional
compensation pursuant to  the Equity Participation  Plan and compensation  under
Arby's  proposed mid-term  cash incentive  plan (described  below). Mr. Pierce's
annual base salary  will be  reviewed annually  for possible  increase, but  not
decrease, by Arby's Board of Directors.
 
CASH INCENTIVE PLANS
 
     Triarc  intends to  develop annual cash  incentive plans  and mid-term cash
incentive plans (each,  a 'MTCIP') for  executive officers of  each of  Triarc's
four principal business units.
 
     Pursuant to their Employment Agreements, the proposed annual cash incentive
plans  of RC Cola, Graniteville and Arby's will enable Messrs. Carson, Kingsmore
and Pierce, respectively, to earn up to 75% of their then-current base  salaries
based  on achievement of certain individual  and company performance goals to be
determined by Mr. Carson  and Triarc representatives, in  the case of RC  Cola's
plan,  Mr. Kingsmore and  Triarc representatives, in  the case of Graniteville's
plan and Mr.  Pierce and  Triarc representatives, in  the case  of Arby's  plan.
Officers and key employees of each of RC Cola,
 
                                      130
 
<PAGE>
Graniteville  and Arby's  will also be  eligible to participate  in the relevant
company's plan, which will be administered by such company's board of directors.
 
     From time to time, the Compensation Committee of the Triarc Board may award
discretionary bonuses based  on performance to  certain executive officers.  The
amounts of such bonuses will be based on the Compensation Committee's evaluation
of each such individual's contribution.
 
     Pursuant  to  the terms  of  their Employment  Agreements,  Messrs. Carson,
Kingsmore and Pierce also will  be entitled to additional compensation  pursuant
to  a proposed  MTCIP of  RC Cola,  Graniteville and  Arby's, respectively. Each
MTCIP will be developed jointly by the chief executive officer of the subsidiary
and representatives of Triarc. Each MTCIP  will be designed to yield to  Messrs.
Carson, Kingsmore and Pierce a target award in cash at least equal to 75% of the
participant's  then-current base salary  if RC Cola,  Graniteville or Arby's, as
the case may be,  achieves an agreed-upon profit  over a three-year  performance
cycle. During each plan year, an amount will be accrued based upon the amount by
which the relevant company's profit for such year exceeds a minimum return to be
determined.  A new three-year performance cycle  will begin each year, such that
after the third year  the annual cash amount  paid to Messrs. Carson,  Kingsmore
and Pierce pursuant to the relevant MTCIP should equal the target award if their
respective  company's profit goals  have been achieved.  For Mr. Carson, amounts
accrued with respect  to 1994 will  be guaranteed at  a minimum of  100% of  the
target award for 1994 (i.e. at least $125,000).
 
1993 EQUITY PARTICIPATION PLAN
 

     The  Equity Participation Plan  was adopted on April  24, 1993, amended and
restated on  July  22, 1993,  and,  as amended  and  restated, was  approved  by
Triarc's  shareholders on October 27, 1993. It expires by its terms on April 24,
1998. The plan  provides for the  grant of  options to purchase  Triarc Class  A
Common  Stock, tandem SARs and restricted shares of Triarc Class A Common Stock.
Selected officers and key employees of,  and key consultants to, Triarc and  its
subsidiaries  are  eligible  to  participate  in the  plan.  The  plan  is being
administered by  the Compensation  Committee  of the  Triarc Board,  which  will
determine  from time to  time to grant  options, SARs and  restricted stock. One
third of the options granted to Messrs. Carson, Kingsmore and Pierce pursuant to
their respective Employment Agreements will vest after each of the third, fourth
and fifth anniversaries of the date of grant and the options will be exercisable
at any time between the date of vesting and the tenth anniversary of the date of
grant. One third of the options granted to Messrs. Peltz, May and Kalvaria  will
vest  after each  of the first,  second and  third anniversaries of  the date of
grant and  the options  will be  exercisable at  any time  between the  date  of
vesting  and the tenth anniversary of the  date of grant. The options granted to
Mr. Coppersmith  were forfeited  as a  result  of his  resignation. All  of  the
restricted shares of Triarc Class A Common Stock granted to Mr. Carson will vest
on May 10, 1996, and all of the restricted shares of Triarc Class A Common Stock
granted  to Messrs.  Kalvaria, Kingsmore  and Pierce  will vest  on December 31,
1996.

 
MISCELLANEOUS
 
     Messrs. Carson, Kingsmore,  Pierce and  Kalvaria are  entitled pursuant  to
their  respective  Employment  Agreements  to  participate  in  other  long-term
compensation and life  insurance, disability  and medical  plans made  generally
available  to senior officers of RC Cola, Graniteville and Arby's, respectively.
Messrs. Carson, Kingsmore and Pierce also will be provided the use of a car  and
other  customary  benefits  during  the terms  of  their  respective agreements.
Pursuant to  Triarc's standard  employment-related relocation  policy, which  is
applicable to each of the Named Officers and other senior officers of Triarc, an
officer's  compensation will be  increased to the extent  necessary to cause all
employment-related relocation expenses to be fully reimbursed on an  'after-tax'
basis.
 
     Mr.  Coppersmith resigned  as an officer  and employee  of SEPSCO effective
August 10, 1993 and entered into a consulting agreement with SEPSCO pursuant  to
which  he will  render consulting  services on  a part-time  basis for  a fee of
$30,000 per month until May  1, 1995. At the end  of the consulting period,  Mr.
Coppersmith  may  receive a  discretionary  bonus based  upon  the value  of the
services rendered by him.
 
                                      131
 
<PAGE>

OPTIONS/SARS GRANTED IN RESPECT OF FISCAL 1993 AND TRANSITION 1993

 

     The following table sets forth certain information with respect to  options
to purchase shares of Triarc Class A Common Stock and tandem SARs granted to the
Chief  Executive Officer and  the Named Officers  in respect of  Fiscal 1993 and
Transition 1993 performance. As noted in such table, certain of such options and
tandem SARs were granted on March 1,  1994, subsequent to the end of  Transition
1993, but in respect of Transition 1993 performance. No stock options (or tandem
SARs)  or freestanding SARs were exercised by  the Chief Executive Officer or by
any Named Officer during Fiscal 1993 or Transition 1993.

 

OPTION/SAR GRANTS IN RESPECT OF FISCAL 1993 AND TRANSITION 1993

 

<TABLE>
<CAPTION>
                                                                                                  GRANT DATE
                                     INDIVIDUAL GRANTS                                               VALUE
- --------------------------------------------------------------------------------------------     -------------
                             (b)                  (c)                  (d)
                           OPTIONS/     % OF TOTAL OPTIONS/SARS     EXERCISE                          (f)
                             SARS       GRANTED TO EMPLOYEES IN      OR BASE         (e)          GRANT DATE
           (a)             GRANTED      RESPECT OF FISCAL 1993        PRICE       EXPIRATION     PRESENT VALUE
          NAME               (#)          AND TRANSITION 1993        ($/SH)          DATE           ($)(1)
- -------------------------  --------     -----------------------     ---------     ----------     -------------
<S>                        <C>          <C>                         <C>           <C>            <C>
Nelson Peltz.............   600,000(2)(4)            27%               18.00        4/24/03        6,145,200
                             75,000(3)(4)                              21.00         3/1/04          896,175
Peter W. May.............   400,000(2)(4)            18%               18.00        4/24/03        4,096,800
                             50,000(3)(4)                              21.00         3/1/04          597,450
Leon Kalvaria............   150,000(2)(4)             8%               18.00        4/24/03        1,536,300
                             40,000(3)(4)                              21.00         3/1/04          477,960
John C. Carson...........   120,000(2)(5)             6%               18.00        4/24/03        1,157,760
                             30,000(3)(5)                              21.00         3/1/04          337,680
Harold D. Kingsmore......    50,000(2)(5)             2%               18.00        4/24/03          482,400
                             10,000(3)(5)                              21.00         3/1/04          112,560
Donald L. Pierce.........    65,000(2)(5)             4%               18.00        4/24/03          627,120
                             35,000(3)(5)                              21.00         3/1/04          393,960
Jack Coppersmith(6)......    25,000(2)                1%               18.00        4/24/03          241,200
</TABLE>

 

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

 

(1) These values were calculated using a Black-Scholes option pricing model. The
    actual value,  if any,  that an  executive may  realize will  depend on  the
    excess,  if any, of the stock price over  the exercise price on the date the
    options are exercised, and no assurance exists that the value realized by an
    executive will be at or near the value estimated by the Black-Scholes model.
    The following assumptions were used in the calculations:

 

    (a) assumed option term of 7.5 years;

 

    (b) stock price volatility factor of 0.4758;

 

    (c) 6.5% annual discount rate;

 

    (d) no dividend payment; and

 

    (e) 3% discount  to Black-Scholes  ratio  for each  year an  option  remains
        unvested.

 

(2)  These  options were granted  on April 24,  1993 and have  an exercise price
     equal to the closing price of the Triarc Class A Common Stock on the ASE on
     April 27, 1993, the first day of trading after the options were granted.

 

(3) These options were granted on March 1, 1994 in respect of performance during
    Transition 1993 and have an exercise price equal to the closing price of the
    Triarc Class A Common Stock on the NYSE on March 1, 1994.

 

(4)  One-third of the options granted will vest on each of the first, second and
     third  anniversaries  of  the  date  of  grant  and  the  options  will  be
     exercisable  at  any  time  between  the  date  of  vesting  and  the tenth
     anniversary of the date of grant.

 
                                              (footnotes continued on next page)
 
                                      132
 
<PAGE>

(footnotes continued from previous page)

 

(5)  One-third of the options granted will vest on each of the third, fourth and
     fifth  anniversaries  of  the  date  of  grant  and  the  options  will  be
     exercisable  at  any  time  between  the  date  of  vesting  and  the tenth
     anniversary of the date of grant.


(6)  Mr. Coppersmith resigned as  an officer and  employee effective August  10,
     1993 and as a result, he has forfeited his options.

 

OPTION/SAR VALUES AT END OF FISCAL 1993 AND TRANSITION 1993

 

     The  following table sets forth certain information concerning the value at
the end of Fiscal 1993 and  Transition 1993 of unexercised in-the-money  options
to purchase shares of Triarc Class A Common Stock and tandem SARs granted to the
Chief  Executive Officer  and the  Named Officers outstanding  as of  the end of
Fiscal 1993 and  Transition 1993.  This table does  not include  the options  to
purchase  shares  of Triarc  Class A  Common  Stock and  tandem SARs  which were
granted on March  1, 1994 because  such options  and SARs had  not been  granted
until  subsequent  to  the  end  of Transition  1993  and,  therefore,  were not
outstanding as of the end of Fiscal 1993 or Transition 1993.

 
OPTION/SAR VALUES AT END OF FISCAL 1993 AND TRANSITION 1993
 
<TABLE>
<CAPTION>
                                                               (d)
                                                            NUMBER OF          (e)               (f)
                                                            SECURITIES       VALUE OF          VALUE OF
                                                            UNDERLYING     UNEXERCISED     UNEXERCISED IN-
                                                           UNEXERCISED     IN-THE-MONEY       THE-MONEY
                                                           OPTIONS/SARS    OPTIONS/SARS      OPTIONS/SARS
                                    (b)                   AT FISCAL 1993  AT FISCAL 1993  AT TRANSITION 1993
                                  SHARES         (c)        END(#)(1)       END($)(2)         END($)(3)
             (a)                ACQUIRED ON     VALUE      EXERCISABLE/    EXERCISABLE/      EXERCISABLE/
             NAME               EXERCISE(#)  REALIZED($)  UNEXERCISABLE   UNEXERCISABLE     UNEXERCISABLE
- ------------------------------  -----------  -----------  --------------  --------------  ------------------
<S>                             <C>          <C>          <C>             <C>             <C>
Nelson Peltz..................       -0-          -0-       -0-/600,000     -0-/525,000       -0-/4,200,000
Peter W. May..................       -0-          -0-       -0-/400,000     -0-/350,000       -0-/2,800,000
Leon Kalvaria.................       -0-          -0-       -0-/150,000     -0-/131,250       -0-/1,050,000
John C. Carson................       -0-          -0-       -0-/120,000     -0-/105,000        -0-/ 840,000
Harold D. Kingsmore...........       -0-          -0-       -0-/ 50,000     -0-/ 43,750        -0-/ 350,000
Donald L. Pierce..............       -0-          -0-       -0-/ 65,000     -0-/ 56,875        -0-/ 455,000
</TABLE>
 
- ------------
 
(1) At the  end  of Transition  1993,  there was  no  change in  the  number  of
    securities  underlying  unexercised Options/SARs  granted to  the identified
    persons or in  the number  of such  Options/SARs that  were exercisable  and
    unexercisable at the end of Transition 1993.
 
(2) On  April 30, 1993,  the last day of  Fiscal 1993, the  closing price of the
    Triarc Class A Common Stock on the ASE was $18 7/8.
 
(3) On December 31, 1993, the last day of Transition 1993, the closing price  of
    the Triarc Class A Common Stock on the NYSE was $25.00.
 
                                      133
 
<PAGE>
                   OWNERSHIP OF TRIARC SECURITIES BY CERTAIN
                        BENEFICIAL OWNERS AND MANAGEMENT
 
     The  following table sets forth the beneficial ownership as of December 31,
1993 by each person known by Triarc to  be the beneficial owner of more than  5%
of  the outstanding shares of Triarc Class A Common Stock (constituting the only
class of voting capital stock of Triarc),  each director of Triarc who has  such
ownership,  the  executive  officers  of the  Triarc  Companies  who constituted
Triarc's four most highly compensated executive officers in Transition 1993  and
all directors and executive officers as a group.
 
<TABLE>
<CAPTION>
                                                               AMOUNT AND
                   NAME AND ADDRESS OF                           NATURE
                    BENEFICIAL OWNER                        OF OWNERSHIP(1)            PERCENT OF CLASS
- ---------------------------------------------------------   ----------------           ----------------
<S>                                                         <C>                        <C>
DWG Acquisition Group, L.P. .............................   5,982,867 shares(4)              28.1%
  1201 North Market Street
  Wilmington, DE 19801
Nelson Peltz ............................................   5,982,967 shares(2)(3)(4)        28.1%
  777 South Flagler Drive
  West Palm Beach, FL 33401
Peter W. May ............................................   5,982,867 shares(2)(4)           28.1%
  900 Third Avenue
  New York, NY 10022
Leon Kalvaria ...........................................      30,000 shares(5)               *
  777 South Flagler Drive
  West Palm Beach, FL 33401
Harold E. Kelly .........................................      60,000 shares(5)               *
  777 South Flagler Drive
  West Palm Beach, FL 33401
Richard M. Kerger .......................................      30,000 shares(5)               *
  777 South Flagler Drive
  West Palm Beach, FL 33401
Daniel R. McCarthy ......................................      30,000 shares(5)               *
  777 South Flagler Drive
  West Palm Beach, FL 33401
William L. Pallot .......................................         431 shares                  *
  400 Pickle Road
  Shelbyville, TN 37160
Martin Rosen ............................................       6,000 shares                  *
  757 Third Avenue, 6th FL
  New York, NY 10017
Stephen S. Weisglass ....................................      10,000 shares                  *
  950 Third Avenue, 26th FL
  New York, NY 10022
John C. Carson ..........................................      37,500 shares(5)               *
  100 Corporate Drive
  Ft. Lauderdale, FL 33334
Harold D. Kingsmore .....................................      50,000 shares(5)               *
  133 Marshall Street
  Graniteville, SC 29829
Donald L. Pierce ........................................      60,000 shares(6)               *
  100 Corporate Drive
  Ft. Lauderdale, FL 33334
Directors and Executive Officers as a group                 6,405,398 shares                 30.0%
  (24 persons)
</TABLE>
 
- ------------
 
  * Less than 1%.
 
(1) Except  as otherwise indicated, each person  has sole voting and dispositive
    power with respect to such shares.
 
(2) Includes 5,982,867 shares held  by DWG Acquisition, of  which Mr. Peltz  and
    Mr. May are the sole general partners.
 
(3) Includes  100 shares owned by  Mr. Peltz's minor son,  as to which Mr. Peltz
    disclaims beneficial ownership.
 
                                              (footnotes continued on next page)
 
                                      134
 
<PAGE>
(footnotes continued from previous page)
 
(4) As previously described under 'SPECIAL FACTORS -- Background to the  Merger;
    Reasons  for the Merger -- The Reorganization and Related Matters,' on April
    23, 1993, DWG Acquisition acquired 5,982,867 shares of Triarc Class A Common
    Stock  from  the  Posner  Entities,  for  an  aggregate  purchase  price  of
    $71,794,404   (the  'Purchase   Price').  In   addition,  as   part  of  the
    Reorganization on April 23, 1993,  Triarc exchanged the remaining  5,982,866
    shares  of Triarc  common stock  owned by the  Posner Entities  for an equal
    number of shares of Redeemable  Convertible Preferred Stock having a  stated
    value of $12.00 per share or an aggregate stated value of $71,794,392.
 
    Triarc  is informed  that Mr. Peltz  contributed two-thirds  of the Purchase
    Price to DWG Acquisition and Mr.  May contributed one-third of the  Purchase
    Price  to DWG Acquisition. Of such funds, approximately $26.8 million of the
    amount contributed  by Mr.  Peltz  and approximately  $14.3 million  of  the
    amount  contributed by Mr. May  was made available to  Messrs. Peltz and May
    through certain loans (the 'Citibank Loans') made in the ordinary course  of
    business  by Citibank, N.A. ('Citibank'). Approximately $21.1 million of the
    amount contributed by Mr. Peltz and approximately $1.7 million of the amount
    contributed by Mr. May was made  available to Messrs. Peltz and May  through
    certain loans (the 'Republic Loans') made in the ordinary course of business
    by  Republic National  Bank of  New York.  The remaining  approximately $7.9
    million of the Purchase Price was contributed to DWG Acquisition by Mr.  May
    from his personal funds.
 
    The  Citibank Loans  are demand loans  bearing interest at  such bank's base
    rate. Such loans were initially secured  by certain assets of Messrs.  Peltz
    and  May (other than the shares of  Triarc Class A Common Stock purchased by
    DWG Acquisition and their partnership interests in DWG Acquisition). On  May
    6,  1993, an aggregate of 740,000 shares of Triarc Class A Common Stock (the
    'Pledged Shares')  were  pledged  by DWG  Acquisition  in  substitution  for
    certain other collateral securing the Citibank Loans, which other collateral
    was  released by  Citibank upon delivery  of the Pledged  Shares. The Pledge
    Agreement contains standard provisions concerning the maturity of the  loans
    and  other provisions with  respect thereto and with  respect to the Pledged
    Shares. The loan documentation in connection with the Citibank Loan contains
    standard default and similar provisions.
 
    The Republic  Loans are  revolving  loans bearing  interest at  either  such
    bank's  reference rate or a rate based upon the London interbank market rate
    and are  secured by  certain assets  of Messrs.  Peltz and  May (other  than
    shares  of Triarc Class A Common Stock or their partnership interests in DWG
    Acquisition).
 
    On May  14, 1993,  Messrs. Peltz  and  May also  entered into  certain  loan
    documentation  with respect  to certain  loans aggregating  $24 million (the
    'Custodial Loans') made in the ordinary course of business to Messrs.  Peltz
    and  May by  Custodial Trust Company.  The Custodial Loans  are demand loans
    bearing interest at the  prime rate and are  secured by 3,300,000 shares  of
    Triarc  Class  A Common  Stock owned  by DWG  Acquisition and  certain other
    securities owned by  Messrs. Peltz and  May (and their  spouses) other  than
    Triarc  Class A Common Stock. The  loan documentation in connection with the
    Custodial Loans contains standard provisions concerning the maturity of  the
    loans  and other  provisions with  respect thereto  and with  respect to the
    shares of Triarc Class A Common Stock.

(5) Represents restricted shares granted under the Equity Participation Plan.
 
(6) Represents 55,000 restricted shares  granted under the Equity  Participation
    Plan and 5,000 shares purchased by Mr. Pierce.
 
- ----------------------------------------------------------
     The  foregoing table  does not include  the 5,982,866  shares of Redeemable
Convertible Preferred Stock owned by a  Posner Entity, which are convertible  by
it into 4,985,722 shares of Triarc Class B Common Stock at a conversion price of
$14.40  per share, subject to certain  adjustments, and can be converted without
restriction into  an equal  number of  shares  of Triarc  Class A  Common  Stock
following  a transfer to  a non-affiliate of Posner.  If the 5,982,866 currently
outstanding Redeemable Convertible Preferred  Shares were converted into  shares
of Triarc Class A Common Stock, such shares would constitute approximately 17.2%
of  the then  outstanding shares  of Triarc  Class A  Common Stock  after giving
effect to the issuance of shares of  Triarc Class A Common Stock in the  Merger.
Except  for the pledges  of an aggregate  of 4,040,000 shares  of Triarc Class A
Common Stock  described  in  note (4)  to  the  foregoing table,  there  are  no
arrangements  known to Triarc  the operation of  which may at  a subsequent date
result in a change in control of Triarc.
 
                                      135

<PAGE>
                              MANAGEMENT OF SEPSCO
 
EXECUTIVE OFFICERS AND DIRECTORS OF SEPSCO
 
     The  following table sets forth certain information regarding the directors
and executive officers of SEPSCO, all of whom are U.S. citizens.
 
<TABLE>
<CAPTION>
                 NAME                     AGE                                POSITIONS
- ---------------------------------------   ---   -------------------------------------------------------------------
<S>                                       <C>   <C>
Nelson Peltz...........................   51    Chairman and Chief Executive Officer, and Director
Peter W. May...........................   51    President and Chief Operating Officer, and Director
Leon Kalvaria..........................   35    Vice Chairman and Director
David E. Schwab II.....................   62    Director
Sir Ian MacGregor......................   80    Director
Anthony W. Graziano, Jr................   52    Executive  Vice  President  and  General  Counsel,  and   Assistant
                                                  Secretary
Joseph A. Levato.......................   53    Executive Vice President and Chief Financial Officer
Gilbert L. Bieger, Jr..................   48    Senior Vice President - Operations
John L. Cohlan.........................   36    Senior Vice President - Corporate Finance
Curtis S. Gimson.......................   38    Senior Vice President and Associate General Counsel, and Secretary
Jerry Hostetter........................   49    Senior Vice President - Corporate Communications
Francis T. McCarron....................   36    Senior Vice President - Taxes
Fred H. Schaefer.......................   49    Vice President and Chief Accounting Officer
</TABLE>
 
     Each  of  the  persons  identified  above other  than  Mr.  Bieger  and Mr.
Hostetter first became an  officer and/or director of  SEPSCO in April 1993,  in
connection  with the  Reorganization. Mr. Hostetter  first became  an officer of
SEPSCO in September 1993. Mr. Bieger has  been employed by SEPSCO for more  than
five  years  and  was first  been  elected an  officer  of SEPSCO  in  1981. See
'MANAGEMENT OF  TRIARC' for  additional information  concerning all  individuals
identified above other than Messrs. Schwab, McGregor and Bieger. Set forth below
is certain additional information concerning Messrs. Schwab and McGregor.
 
     David  E. Schwab II  was a director  of Triangle from  1980 through January
1989. He was  a director of  Avery from June  1989 through March  1991 and  from
January  1987 through October 1987. Mr. Schwab  has been a director of Equitable
Bag since August 1992. Since prior to 1987, Mr. Schwab has been a member of  the
law  firm of Schwab Goldberg Price & Dannay,  New York, New York. Mr. Schwab has
been a director of SEPSCO since April 23, 1993.
 
     Sir Ian MacGregor is a partner in the investment banking firm of McFarland,
Dewey and Co. He has  been a Director and  Chairman of Holmes Protection  Group,
Inc.,  a  security services  company, since  September  1991. Mr.  MacGregor was
associated with Mountleigh  as a  Director and in  various executive  capacities
from  1987  until 1992.  He was  formerly  Chairman and  Chief Executive  of The
National Coal  Board, The  British  Steel Corporation,  AMAX, and  was  formerly
Chairman  of Hunterprint plc. Mr. MacGregor has  been a director of SEPSCO since
April 23, 1993.
 
     Each director has been  elected to serve until  the next annual meeting  of
SEPSCO  Stockholders and  until his  successor is  duly chosen  and qualified or
until his prior death, resignation or removal.
 
     The term of office  of each executive officer  is until the  organizational
meeting  of  the  SEPSCO  Board  following the  next  annual  meeting  of SEPSCO
Stockholders and until his successor is elected and qualified or until his prior
death, resignation or removal.
 
                                      136
 
<PAGE>
                   OWNERSHIP OF SEPSCO SECURITIES BY CERTAIN
                        BENEFICIAL OWNERS AND MANAGEMENT
 
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
 
     The security ownership  of each person  who is  known to SEPSCO  to be  the
beneficial  owner of more than five percent  of any class of SEPSCO Voting Stock
as of December 31, 1993, is as follows:
 
<TABLE>
<CAPTION>
                                                                             AMOUNT AND
                                                                             NATURE OF
                                           NAME AND ADDRESS OF               BENEFICIAL        PERCENT
          TITLE OF CLASS                    BENEFICIAL OWNER                 OWNERSHIP         OF CLASS
- ----------------------------------  ---------------------------------   --------------------   --------
<S>                                 <C>                                 <C>                    <C>
Common Stock......................  Triarc Companies, Inc.(1)            8,298,456 shares(2)     71.2%(2)
                                    GS Holdings, Inc.
                                    777 S. Flagler Drive
                                    West Palm Beach, FL 33401
Preferred Stock Series B
  Convertible.....................  Triarc Companies, Inc.(1)                  490 shares(3)      100%
                                    777 S. Flagler Drive
                                    West Palm Beach, FL 33401
</TABLE>
 
- ------------
 
(1) See 'OWNERSHIP  OF  TRIARC  SECURITIES  BY  CERTAIN  BENEFICIAL  OWNERS  AND
    MANAGEMENT'  for  information  concerning  certain  beneficial  ownership of
    Triarc's voting securities. GS Holdings,  Inc. is a wholly-owned  subsidiary
    of Triarc.
 
(2) Includes   shares  issuable  upon  conversion   of  SEPSCO  Preferred  Stock
    (convertible into 8,167 shares of SEPSCO Common Stock).
 
(3) Convertible into 8,167 shares of SEPSCO Common Stock.
 
SECURITY OWNERSHIP OF MANAGEMENT
 
     The beneficial ownership  of the  equity securities  of SEPSCO  and of  its
parent,  Triarc, by each director  of SEPSCO who has  such ownership, and by the
directors and executive officers of SEPSCO as  a group, as of October 31,  1993,
is set forth in the following two tables:
 
                                     SEPSCO
 
<TABLE>
<CAPTION>
                                                                           AMOUNT AND NATURE           PERCENT
              TITLE OF                              NAME OF                  OF BENEFICIAL               OF
               CLASS                           BENEFICIAL OWNER              OWNERSHIP(1)               CLASS
- ------------------------------------   ---------------------------------   -----------------           -------
<S>                                    <C>                                 <C>                         <C>
Common Stock........................   Directors and Executive Officers       328 shares                  *
                                       of SEPSCO as a group (13 persons)
</TABLE>
 
- ------------
 
*  Less than 1%.
 
(1) Except  as  otherwise noted,  to the  best knowledge  of SEPSCO  each listed
    person has both sole voting and sole  investment power as to the shares  set
    forth opposite his name in the table above.
 
                                      137
 
<PAGE>
                                     TRIARC
 
<TABLE>
<CAPTION>
                                                                                AMOUNT AND NATURE      PERCENT
                TITLE OF                                 NAME OF                  OF BENEFICIAL          OF
                  CLASS                             BENEFICIAL OWNER              OWNERSHIP(1)          CLASS
- -----------------------------------------   ---------------------------------   -----------------      -------
<S>                                         <C>                                 <C>                    <C>
Class A Common Stock.....................   Nelson Peltz                         5,982,967 shares(2)(3)  28.1%
                                            Peter W. May                         5,982,867 shares(2)     28.1%
                                            Leon Kalvaria                           30,000 shares           *
                                            Directors and Executive Officers     6,121,844 shares        28.7%
                                            of SEPSCO as a group (13 persons)
</TABLE>
 
- ------------
 
*  Less than 1%.
 
(1) Except  as otherwise noted, to the best  knowledge of Triarc and SEPSCO each
    listed person  has both  sole voting  and sole  investment power  as to  the
    shares set forth opposite his name in the table above.
 
(2) Includes 5,982,867 shares held by DWG Acquisition of which Mr. Peltz and Mr.
    May are the sole general partners.
 
(3) Includes  100 shares owned by  Mr. Peltz's minor son,  as to which Mr. Peltz
    disclaims beneficial ownership.
 
POSSIBLE CHANGES IN CONTROL
 
     Except as described below, there are  no arrangements known to SEPSCO,  the
operation  of which  may at  a subsequent  date directly  result in  a change of
control of SEPSCO.
 
     In   connection   with   the   Reorganization,   Graniteville    refinanced
substantially  all of its indebtedness and  entered into the Graniteville Credit
Facility. The  Graniteville Credit  Facility is  guaranteed by  Triarc and  such
guarantee  is secured by a pledge of (i) 51% of the issued and outstanding stock
of Graniteville owned by a wholly-owned subsidiary of Triarc (subject only to an
existing pledge on  such stock  held by  SEPSCO) and (ii)  at least  70% of  the
issued  and outstanding shares of SEPSCO Common Stock. The Graniteville Facility
contains standard  provisions concerning  the maturity  of the  loans and  other
provisions  with respect thereto  and with respect to  the securities pledged by
Triarc including the shares of SEPSCO Common Stock.
 
     See Note (4) under  'OWNERSHIP OF TRIARC  SECURITIES BY CERTAIN  BENEFICIAL
OWNERS  AND MANAGEMENT' for certain arrangements regarding Triarc Class A Common
Stock, the operation of  which may at  a subsequent date result  in a change  of
control of Triarc and indirectly result in a change of control of SEPSCO.
 
                                      138
 
<PAGE>
                        INFORMATION RELATING TO MERGERCO
 
GENERAL
 
     Mergerco is a newly formed Delaware corporation organized by Triarc for the
sole  purpose of  effecting the  Merger. The  directors and  the stockholders of
Mergerco have approved the Merger Agreement.  Mergerco will not have any  assets
or  liabilities (other than those arising  under the Merger Agreement) or engage
in any activities other than those incident to its formation, capitalization  or
the  Merger. As of  the date of this  Proxy Statement-Prospectus, the authorized
capital stock of Mergerco consists of  10,000 shares of common stock, par  value
$1.00 per share, and 1,000 of such shares are issued and outstanding. All of the
issued  and outstanding shares of  Mergerco are owned by  Triarc. In the Merger,
Mergerco will  merge with  and  into SEPSCO,  with  SEPSCO being  the  surviving
corporation in the Merger.
 
EXECUTIVE OFFICERS AND DIRECTORS OF MERGERCO
 
     The  following table sets forth certain information regarding the directors
and executive officers of Mergerco,  each of whom has  served as such since  the
incorporation of Mergerco. All of such individuals are U.S. citizens.
 
<TABLE>
<CAPTION>
                NAME                   AGE                            POSITION
- ------------------------------------   ---   -----------------------------------------------------------
<S>                                    <C>   <C>
Nelson Peltz........................   51    Chairman and Chief Executive Officer, and Director
Peter W. May........................   51    President and Chief Operating Officer, and Director
Leon Kalvaria.......................   35    Vice Chairman and Director
Anthony W. Graziano, Jr.............   52    Executive Vice President and General Counsel and Assistant
                                               Secretary
Joseph A. Levato....................   53    Executive Vice President and Chief Financial Officer
Curtis S. Gimson....................   38    Senior Vice President and Associate General Counsel and
                                               Secretary
</TABLE>
 
     See  'MANAGEMENT OF  TRIARC' for additional  information about  each of the
individuals listed above.
 
     Each director has been  elected to serve until  the next annual meeting  of
Mergerco  stockholders and until  his successor is duly  chosen and qualified or
until his prior death, resignation or removal.
 
     The term of office  of each executive officer  is until the  organizational
meeting  of the Mergerco Board of Directors following the next annual meeting of
Mergerco stockholders and until his successor is elected and qualified or  until
his prior death, resignation or removal.
 
                                      139
 
<PAGE>
                 CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
 
CERTAIN TRANSACTIONS IN CONNECTION WITH THE REORGANIZATION
 
     As  described in 'SPECIAL FACTORS --  Background to the Merger; Reasons for
the  Merger  --  The  Reorganization   and  Related  Matters'  and  in   'TRIARC
MANAGEMENT'S  DISCUSSION  AND ANALYSIS  OF FINANCIAL  CONDITIONS AND  RESULTS OF
OPERATIONS,' Triarc  and  its  subsidiaries completed  certain  transactions  in
connection  with  the Reorganization,  including transactions  involving certain
Posner Entities. Such transactions included:
 
          (a) The exchange by the Posner Entities and Triarc of 5,982,866 shares
     of Triarc  common  stock  for  an equal  number  of  shares  of  Redeemable
     Convertible Preferred Stock;
 
          (b)  The resignation of  Victor Posner and his  son, Steven Posner, as
     officers and  employees of  Triarc  and all  of  its subsidiaries  and  the
     entering  into with Steven Posner of  a five year consulting agreement (not
     requiring the provision of any substantial services) which provided for  an
     initial  payment of $1,000,000  on April 23, 1993  and an annual consulting
     fee of $1,000,000 thereafter;
 
          (c) The entering into of a  modification of the lease with respect  to
     the  corporate headquarters  of Triarc  and certain  subsidiaries described
     below under '  -- Certain  Transactions with Former  Management and  Former
     Affiliates'; and
 
          (d) The purchase of certain minority interests in CFC Holdings, SEPSCO
     and Wilson Brothers from the Posner Entities described below (the 'Minority
     Share Acquisitions').
 
     In  the  Minority  Share  Acquisitions,  Triarc  acquired  from  the Posner
Entities, shares  of certain  subsidiaries for  an aggregate  purchase price  of
$17.2  million. After giving  effect to the  offsets of certain  amounts owed to
Triarc, the  Posner  Entities received  net  proceeds from  the  Minority  Share
Acquisitions  aggregating approximately $9.7  million. The prices  paid for such
minority interests were determined by negotiations among Triarc, DWG Acquisition
and  the  sellers  in  the  context  of  the  Reorganization  and  no   separate
determination  was made that the respective purchase prices represented the fair
value of the share purchased.
 
     In accordance  with  certain  agreements (the  'CFC  Holdings  Agreements')
between  Triarc and  certain holders  of shares  of common  stock (the 'Holdings
Common Stock') of CFC Holdings, which agreements are described in the  following
two  paragraphs, Triarc purchased  on April 23,  1993 an additional  4.5% of the
shares of Holdings Common Stock.
 
     Pursuant to the CFC Holdings Agreements, Triarc purchased from NVF on April
23, 1993 141,000 shares of Holdings Common Stock representing 1.4% of the issued
and outstanding capital stock of CFC Holdings for $3.6 million. At December  31,
1992,  the aggregate  net book  value of the  141,000 shares  of Holdings Common
Stock being sold by NVF was  approximately $212,000. Triarc made payment of  the
purchase price to NVF first by offset against amounts (aggregating approximately
$2.5  million) owed  to Triarc and  subsidiaries by  NVF on account  of the cost
sharing arrangements  described  under '  --  Certain Transactions  with  Former
Management  and Former Affiliates' (the  'Former Cost Sharing Arrangements') and
$1.1 million  was paid  by Triarc  to NVF  in cash.  At April  23, 1993,  Posner
Entities  beneficially  owned  approximately  38.2%  of  the  outstanding voting
securities  of  NVF  (approximately  36.4%   of  NVF's  common  stock   actually
outstanding  on such  date) and  NVF may  be deemed  to be  controlled by Victor
Posner. In August 1993,  NVF became a  debtor in a case  filed by its  creditors
under  Chapter 11  of the  Federal Bankruptcy  Code. For  information concerning
claims made  against  the  Triarc  Companies by  NVF's  bankruptcy  counsel  and
reserves  taken by  the Triarc  Companies in  respect of  contingent liabilities
relating to  the  NVF  Proceedings,  see  'TRIARC  MANAGEMENT'S  DISCUSSION  AND
ANALYSIS  OF  FINANCIAL  CONDITION  AND  RESULTS  OF  OPERATIONS  --  Results of
Operations -- Six Months Ended October  31, 1993 Compared with Six Months  Ended
October  31,  1992'  and Notes  2  and  11 to  Notes  to  Condensed Consolidated
Financial Statement of Triarc Companies, Inc. and subsidiaries.
 
     Pursuant to the CFC Holdings Agreements, Triarc purchased from IRM on April
23, 1993, 324,300  shares of  Holdings Common  Stock, representing  3.1% of  the
issued  and outstanding capital stock of CFC  Holdings, for an aggregate of $8.4
million. At  December 31,  1992, the  aggregate net  book value  of the  324,300
shares  of Holdings Common  Stock being sold by  IRM was approximately $488,000.
Triarc
 
                                      140
 
<PAGE>
made payment of the purchase price to  IRM first, by offset of the $2.1  million
owed  to  Triarc by  IRM on  account  of the  stock repurchase  described below,
second, by offset  against amounts  owed to Triarc  and subsidiaries  by IRM  on
account   of  the  Cost  Sharing  Arrangements  described  under  '  --  Certain
Transactions  with  Former  Management   and  Former  Affiliates'   (aggregating
approximately  $1.7 million),  third, by offset  against amounts owed  by IRM to
Chesapeake  Insurance  (representing  insurance  premiums  payable   aggregating
approximately  $1.2 million) and fourth, by the payment by Triarc to IRM in cash
of the remainder, if any. At April 23,  1993, 25% of the stock of IRM was  owned
by  Triarc,  40%  was  owned by  NVF  and  35% was  owned  by  Salem Corporation
('Salem'), which is, in turn, 49% owned by Victor Posner and which may be deemed
to be controlled by Victor Posner.
 
     IRM also purchased from Triarc  on April 23, 1993  the 250 shares of  IRM's
common  stock  owned by  Triarc  for $2.1  million.  At December  31,  1992, the
aggregate net  book  value  of the  shares  of  IRM being  sold  by  Triarc  was
approximately  $1.2 million, after giving pro  forma effect to the proposed sale
by IRM of the shares of the  Holdings Common Stock described above. The  payment
for  such purchase of shares  of IRM owned by Triarc  was made by offset against
amounts owed by Triarc and subsidiaries under the agreement for the sale of  the
Holdings Common Stock, as described above.
 
     In  addition, on  April 23,  1993, Triarc  purchased from  Posner Entities,
721,931 shares  of SEPSCO  Common Stock,  representing 6.2%  of the  issued  and
outstanding  voting securities of  SEPSCO, at a  purchase price of approximately
$6.93 per  share or  an aggregate  of $5  million. Such  price approximated  the
market price for such stock on the date that a letter of intent was entered into
with  respect to the Equity Transactions ($6.875 on September 1, 1992). At April
23, 1993, the closing sale price for SEPSCO's common stock on the PSE was $15.50
and the aggregate  market value  of the 721,931  shares of  SEPSCO common  stock
being purchased by Triarc was approximately $11.2 million. Triarc also purchased
from  Posner  Entities  161,800  shares  of  common  stock  of  Wilson Brothers,
representing approximately 4.9% of the issued and outstanding voting  securities
of  Wilson Brothers, at a purchase price  of approximately $1.24 per share or an
aggregate of $200,000. Such price approximated the net book value for such stock
on the date that a letter of intent was entered into with respect to the  Equity
Transactions  ($1.21 as of June  30, 1992). At April  23, 1993, the closing sale
price for Wilson Brothers' common stock on the PSE was $.5625 and the  aggregate
market  value  of  the 161,800  shares  of  Wilson Brothers  common  stock being
purchased by Triarc was approximately $91,000. The payment for the purchases  of
SEPSCO and Wilson Brothers stock, described above, was made by Triarc in cash.
 
CERTAIN TRANSACTIONS WITH FORMER MANAGEMENT AND FORMER AFFILIATES
 
     During  Fiscal 1993,  Triarc and  its subsidiaries  engaged in transactions
with certain corporations which may be deemed to be controlled by Victor  Posner
and   to  have  been  affiliates  of  Triarc  and  its  subsidiaries  until  the
Reorganization. Such former affiliates (the 'Former Affiliates') were NVF, NVF's
68% owned subsidiary, APL, IRM, Salem and until its filing for protection  under
Chapter 7 of the Federal Bankruptcy Court in February 1992, PEC.
 
     (1)  Pursuant to  a management  services agreement  (the 'Former Management
Services Agreement'), in Fiscal 1993 Triarc provided to its subsidiaries and the
Former Affiliates  certain  management services,  including  legal,  accounting,
internal auditing, insurance, financial and other management services (the 'Cost
Sharing  Arrangements'). Under the Former  Management Services Agreement, Triarc
charged the  Former  Affiliates  $6,640,000  (including  interest  on  past  due
balances)  for such services in Fiscal  1993, excluding the charges described in
Paragraph (2) below. Certain Former Affiliates were unable to pay  approximately
$5,096,000  of the amounts  charged to them  during such period,  and such costs
were  reserved  and  reallocated  among   Triarc  and  subsidiaries  and   other
participants   under  the   Former  Management  Services   Agreement,  of  which
approximately $4,991,000  was borne  by Triarc  and its  subsidiaries in  Fiscal
1993, and the remaining $105,000 was borne by the other participants.
 

     The  agreements  entered into  in connection  with the  Equity Transactions
provided for the termination of providing management services and space pursuant
to the Cost  Sharing Arrangements  to the  Former Affiliates  within six  months
after  the closing of the  Equity Transactions as well  as for the reimbursement
for any space or  services provided to the  Former Affiliates during the  period
between  the date of the closing of the Equity Transactions and the date of such
termination at commercially

 
                                      141
 
<PAGE>
reasonable rates no less than the rate Triarc would charge an unaffiliated third
party. Pursuant to these arrangements, Triarc provided certain limited  services
to  Former Affiliates through  October 23, 1993,  and discontinued such services
thereafter. Charges  to  such Former  Affiliates  for such  services,  including
certain  reinsurance  and  equipment  lease  billings,  aggregated approximately
$166,000 during Transition 1993.
 
     (2) Until January 31, 1994, Triarc leased approximately 297,000 square feet
at 6917 Collins Avenue,  Miami Beach, Florida (the  'Leased Space') from  Victor
Posner  Trust No. 6,  a trust created for  the benefit of  Victor Posner and his
children (the 'Landlord'), pursuant to a master commercial lease agreement dated
as of April  1, 1983  (the 'Lease').  In Fiscal  1993, the  Leased Space,  which
constituted  approximately 98% of the space in such building, was used primarily
for the corporate offices of Triarc, certain of its subsidiaries and certain  of
the  Former Affiliates. Also included in  the Leased Space were apartments which
were used from time to time on an 'as needed' basis by Triarc, its subsidiaries,
and the Former Affiliates for accommodations for persons visiting such corporate
offices. In Fiscal 1993, $5,790,000 of the cost of the Leased Space was borne by
Triarc and its subsidiaries, and $826,000 was charged to the Former  Affiliates.
Approximately $436,000 of the amount charged to certain of the Former Affiliates
during  Fiscal 1993 which such Former Affiliates were unable to pay was reserved
and reallocated among  Triarc and  its subsidiaries and  the other  participants
under  the Former Management Services Agreement, of which approximately $380,000
was borne by Triarc and its subsidiaries.
 
     In connection with the Reorganization, the Landlord and Triarc entered into
a Lease Modification  and Extension  Agreement (the  'Lease Modification').  The
Lease  Modification provided, among other things,  for an extension of the lease
for a period of four years commencing on  April 1, 1993 and ending on March  31,
1997  and  for a  reduction in  the annual  amount of  base rent  retroactive to
October 1, 1992 to the lesser of $14.00 per rentable square foot or an aggregate
of $4 million  per annum.  In addition, the  Lease Modification  provided for  a
reduction  in the amount charged for  inside and outside parking associated with
the building, the elimination of any charges or fees on account of furniture and
fixtures used  in the  apartments described  above and  the elimination  of  any
obligation to restore the premises at the end of the term of the extended lease.
The  Lease Modification  also provided  that the  Landlord may,  on nine months'
notice to Triarc, terminate the lease and that Triarc may, on six months' notice
to the Landlord, terminate the  lease upon payment to  the Landlord of a  single
payment  (the 'Early Termination Payment')  equal to all of  the base rent which
would otherwise  be  payable for  the  balance  of the  extended  term,  without
discount,  plus additional rent due through  the date of such early termination,
less any amounts then  owed by Landlord to  Triarc, and, that thereafter  Triarc
and  subsidiaries shall be released from any further obligations under the Lease
Modification.  Pursuant  to  the   Lease  Modification,  all  outstanding   rent
obligations  for the  Leased Space, aggregating  approximately $20,638,000, were
settled on April 23, 1993 for  $11,738,000 resulting in a rent reduction  credit
of  approximately  $8,900,000.  Aggregate rent  payments  of  approximately $2.9
million were made  by Triarc  Companies in respect  of the  Leased Space  during
Transition  1993. In July 1993,  Triarc gave notice of  termination of the lease
effective January 31, 1994.  Because Landlord and Triarc  have not been able  to
agree upon the precise amount of the Early Termination Payment, the parties have
agreed  to extend the time for payment of the Early Termination Payment to March
14, 1994. In connection with such extension, the parties agreed that the  amount
to  be paid in respect of the  Early Termination Payment will bear interest from
February 1, 1994 until paid at the prime or base reference rate of Citibank.  In
July  1993, Triarc recorded a charge of approximately $13,000,000 to provide for
the remaining payments on the lease subsequent to its cancellation.
 
     (3) In  Fiscal  1993,  NPC  Leasing  Corp.  ('NPC  Leasing'),  an  indirect
wholly-owned  subsidiary of Triarc,  leased vehicles and  other equipment to the
Former Affiliates under long-term lease  obligations which are accounted for  as
direct  financing leases. Lease billings by NPC Leasing to the Former Affiliates
during Fiscal 1993 were approximately $144,000.  Since May 1, 1993, NPC  Leasing
has  not been providing any services to, nor are any material credits due to NPC
Leasing from, any Former Affiliate.
 
     (4) Until  October 1993,  Chesapeake Insurance  provided certain  insurance
coverage  and  the reinsurance  of certain  risks primarily  for Triarc  and its
subsidiaries and  the  Former  Affiliates.  During  Fiscal  1993,  net  premiums
attributable   to  such  insurance  coverage  and  reinsurance  for  the  Former
 
                                      142
 
<PAGE>
Affiliates  approximated  $2,875,000.  Following  the  Reorganization,   Triarc,
determined that Chesapeake Insurance would no longer insure or reinsure risks of
corporations  other than  Triarc and  its subsidiaries.  Chesapeake Insurance no
longer insures or  reinsures any risks  for any periods  commencing on or  after
October 1, 1993.
 
     (5)  During  Fiscal 1993,  Triarc and  its  subsidiaries secured  the major
portion of  their property  and  liability insurance  coverage through  IRM,  an
insurance  agency which acted as agent  or broker and provided claims processing
services. Commissions  and payments  for  such services  to  IRM by  Triarc  and
subsidiaries amounted to approximately $1,591,000 for Fiscal 1993. Such services
from IRM were discontinued subsequent to April 1993.
 

     (6)  In connection with the  Cost Sharing Arrangements, advances, insurance
premiums, equipment leases and accrued interest, Triarc had receivables due from
APL, a Former Affiliate, aggregating $38,120,000  as of April 20, 1992,  against
which  a valuation  allowance of $34,713,000  was recorded.  APL has experienced
recurring losses and other  financial difficulties in recent  years and in  July
1993 APL became a debtor in a proceeding under Chapter 11 of the Bankruptcy Code
(the  'APL  Proceeding').  Accordingly,  during  Fiscal  1993,  Triarc  and  its
subsidiaries provided an additional $9,863,000 for the unreserved portion of the
receivable at April 30,  1992 and additional net  billings in 1993. In  February
1994, the Official Committee of Unsecured Creditors of APL Corporation (the 'APL
Committee')  filed  a complaint  (the  'APL Complaint')  against  certain Posner
Entities, Triarc and  certain companies  formerly or  presently affiliated  with
Posner   or  with  Triarc,  alleging  causes  of  action  arising  from  various
transactions allegedly caused by  the named Posner Entities  in breach of  their
fiduciary  duties to APL and resulting  in corporate waste, fraudulent transfers
and preferences. In the APL Complaint, the APL Committee asserts claims  against
Triarc  for  (a) aiding  and abetting  breach of  fiduciary duty,  (b) equitable
subordination of  claims which  Triarc  may have  against APL,  (c)  declaratory
relief  as  to whether  APL has  any liability  to Triarc,  and (d)  recovery of
fraudulent transfers allegedly made  by APL to Triarc  prior to commencement  of
the  APL Proceeding. The  APL Complaint seeks an  undetermined amount of damages
from Triarc, as well as the  other relief identified in the preceding  sentence.
Because  the APL  Complaint was  filed during  the last  week of  February 1994,
Triarc management has not  had an opportunity to  fully investigate the  matters
contained  therein. However, based on information currently available to Triarc,
Triarc management does not believe that the outcome of the APL Proceedings  will
have  a  material  adverse  effect  on the  financial  condition  or  results of
operations of the Triarc Companies.

 

     (7) Triarc and its subsidiaries had secured receivables from PEC, a  Former
Affiliate,  aggregating  $6,664,000  as  of  April  30,  1992  against  which  a
$3,664,000 valuation allowance was recorded. PEC also filed for protection under
the bankruptcy  code in  February  1992, and  accordingly, during  Fiscal  1993,
Triarc and its subsidiaries provided an additional $3,000,000 for the unreserved
portion  of the receivables  and for Triarc's  significant doubts as  to the net
realizability of the underlying collateral.

 
     In addition  to the  foregoing transactions,  during the  Transition  1993,
Triarc  sold  a  yacht and  certain  other assets  having  a net  book  value of
approximately $400,000 to an entity owned by Victor Posner for cash sales prices
aggregating approximately $310,000.
 
CERTAIN OTHER TRANSACTIONS
 

     Triarc subleases from an affiliate  of Messrs. Peltz and May  approximately
26,800  square feet of furnished office space in  New York, New York owned by an
unaffiliated third  party. In  addition,  until October  26, 1993,  Triarc  also
subleased  from another affiliate of Messrs.  Peltz and May approximately 32,000
square feet of office space in West Palm Beach, Florida owned by an unaffiliated
third party.  Subsequent to  October  26, 1993,  Triarc  assumed the  lease  for
approximately  17,000 square feet  of the office  space in West  Palm Beach. The
aggregate amount paid by Triarc with respect to such subleases was approximately
$1.8 million during  Transition 1993, which  is less than  the aggregate  amount
such  affiliates paid to the unaffiliated  third party owners. Messrs. Peltz and
May have guaranteed to  the unaffiliated landlords payment  of rent for the  New
York and West Palm Beach office space.

 
     Pursuant  to  an agreement  dated as  of  October 1,  1992 entered  into in
connection with the Reorganization, Triarc  agreed to reimburse DWG  Acquisition
for certain of the reasonable, out-of-
 
                                      143
 
<PAGE>
pocket expenses incurred by DWG Acquisition in connection with services rendered
by  it to Triarc without charge relating to the refinancing and restructuring of
Triarc and  subsidiaries and  other transactions  beneficial to  Triarc and  its
subsidiaries.  Pursuant to such agreement, Triarc reimbursed DWG Acquisition for
$229,000 in expenses, which amount  related principally to travel,  reproduction
and delivery expense.
 
     Triangle Aircraft Service Corporation ('TASCO'), a company owned by Messrs.
Peltz  and May, owns three  aircraft. From August 1992  until September 30 1993,
TASCO operated such aircraft and made them available for use by Triarc Companies
for a fee (the  'TASCO Fee'), and  Triarc Companies have  made extensive use  of
these   aircraft.  The  TASCO  Fee  was   an  amount  equal  to  TASCO's  direct
out-of-pocket expenses, excluding fuel, oil  and lubricants, plus two times  the
cost  of fuel, oil and lubricants. The  TASCO Fee was in accordance with Federal
Aviation Administration regulations applicable  to non-charter carriers.  During
Fiscal  1993 and the five  month period commencing on May  1, 1993 and ending on
September 30,  1993,  Triarc and  its  subsidiaries were  charged  $754,000  and
$681,000,  respectively,  in respect  of such  TASCO Fees.  On October  1, 1993,
Triarc and TASCO entered into an  agreement pursuant to which Triarc is  leasing
TASCO's  three aircraft on a  'dry lease' basis (i.e.,  Triarc pays an aggregate
annual rent of $2,200,000 and the operating expenses of the aircraft directly to
unaffiliated third parties). During the three month period commencing October 1,
1993 and ending on December 31, 1993, Triarc and its subsidiaries paid  $550,000
to TASCO pursuant to this agreement.
 
     Until  February  1994, an  affiliate  of Messrs.  Peltz  and May  leased an
apartment in New York City. Commencing June 1, 1993, such apartment was used  by
executives  of Triarc Companies  and, in connection  therewith, Triarc Companies
reimbursed such affiliate approximately $189,000  of rent for the apartment  for
the seven months ended December 31, 1993.
 

     Triarc  and SEPSCO have agreed in principle to the sale by SEPSCO to Triarc
of the stock of the SEPSCO subsidiaries  that hold SEPSCO's natural gas and  oil
working  and  royalty  interests.  The  sale of  SEPSCO's  natural  gas  and oil
interests will be for a  net cash purchase price  of $8.5 million, which  Triarc
and  SEPSCO  believe  is  equal  to their  estimated  fair  value  and  which is
approximately $4.5 million higher than their net book value. It is intended that
the sale will occur after the Merger. However, if the Merger is not approved  by
the  SEPSCO Stockholders (or is not consummated  for any other reason), the sale
of such  stock  to  Triarc will  be  completed  prior to  July  22,  1994.  This
transaction  was approved by  both the Triarc  Board and the  SEPSCO Board, with
both David E. Schwab II  and Sir Ian MacGregor, the  only members of the  SEPSCO
Board  who  are not  also members  of the  Triarc Board,  voting to  approve the
transaction.

 

     During Fiscal 1993 and  Transition 1993, Triarc  and its subsidiaries  paid
Rosen   &  Reade,  a  law   firm,  approximately  $1,744,000  and  approximately
$1,127,000, respectively, on account  of legal services  rendered to Triarc  and
its subsidiaries. Martin Rosen, a director of Triarc, is a partner of such firm.

 
                                      144

<PAGE>
                      DESCRIPTION OF TRIARC CAPITAL STOCK
 
     The  authorized capital  stock of Triarc  consists of  75,000,000 shares of
Triarc Class A Common Stock, 12,000,000  shares of Triarc Class B Common  Stock,
6,000,000  shares of Redeemable Convertible Preferred Stock, 5,000,000 shares of
Triarc Serial  Preferred Stock  and  2,000,000 Shares  of Triarc  Junior  Serial
Preferred  Stock (together with  the Redeemable Convertible  Preferred Stock and
the Triarc Serial Preferred  Stock, the 'Triarc  Preferred Stock,' and  together
with  the Triarc Common Shares, the 'Triarc  Capital Stock'). As of the close of
business on October 27, 1993, there were outstanding 21,323,160 shares of Triarc
Class A Common Stock, no shares of Triarc Class B Common Stock, 5,982,866 shares
of Redeemable Convertible Preferred Stock, no shares of Triarc Serial  Preferred
Stock and no shares of Triarc Junior Serial Preferred Stock.
 
     The  relative preferences and  rights of the Triarc  capital stock, are set
forth in the Triarc Articles. Set forth  below is a summary description of  such
rights  and preferences.  This summary  does not purport  to be  complete and is
qualified by reference to the Triarc Articles.
 
TRIARC COMMON SHARES
 
     The holders of shares of  Triarc Class A Common  Stock are entitled to  one
vote  for each share held of record  on all matters on which Triarc shareholders
are entitled to  vote, including election  of directors. Except  as required  by
Ohio  law, the holders of shares of Triarc Class B Common Stock are not entitled
to vote.
 
     Shares of Triarc Class A Common Stock and Triarc Class B Common Stock share
equally in any dividends or other distributions payable in either cash,  capital
stock of Triarc (other than Triarc Class A Common Stock or Triarc Class B Common
Stock) or other property of Triarc when, as and if declared by the Triarc Board.
If a dividend or distribution payable in Triarc Common Shares is declared on the
Triarc Common Shares, such dividend or distribution shall be made to the holders
of shares of Triarc Class A Stock in the form of shares of Triarc Class A Common
Stock  and shall be made to the holders of shares of Triarc Class B Common Stock
in the form of shares of Triarc Class B Common Stock.
 
     No dividend, other than a stock  dividend payable in Triarc Common  Shares,
may  be paid on the Triarc Common Shares  if Triarc is in arrears on the payment
of dividends on any outstanding Triarc Preferred Stock.
 
     In the event that Triarc shall liquidate, dissolve or be wound up,  whether
voluntarily  or  involuntarily, to  the extent  assets  remain after  payment of
creditors in full  and after there  shall have been  paid or set  aside for  all
Triarc  Preferred Stock then outstanding the  full preferential amounts to which
they are entitled, the  net assets of Triarc  remaining will be divided  ratably
among  the holders  of the Triarc  Class A Common  Stock and the  Triarc Class B
Common Stock.  The merger  or consolidation  of Triarc  with or  into any  other
corporation,  the merger or consolidation of  any other corporation with or into
Triarc, or the  sale, lease or  conveyance of  all or substantially  all of  its
assets  would not be deemed  to be a liquidation,  dissolution or winding up for
this purpose.
 
     The holders  of  Triarc Common  Shares  are not  entitled  as of  right  to
purchase or subscribe for any shares of stock of any class whether heretofore or
hereafter  authorized or issued, whether issued  for cash, property, services or
by way of a dividend.
 
     Shares of Triarc Class  A Common Stock are  not convertible. Each share  of
Triarc  Class B  Common Stock  is convertible, on  a one-to-one  basis, into one
share of Triarc Class  A Common Stock,  provided that either  (i) the holder  of
such  share upon conversion is  not a Posner Entity  or an affiliate thereof, or
(ii) upon such conversion such shares are placed into a voting trust and certain
other conditions are met.
 
REDEEMABLE CONVERTIBLE PREFERRED STOCK
 
     Each share of Redeemable Convertible Preferred Stock is entitled to receive
out of funds legally available therefor, when, as and if declared by the  Triarc
Board,  preferential  dividends in  cash at  an annual  rate of  8 1/8%  of such
share's 'Stated Value' ($12.00 per share) or $.975 per share. Such dividends are
payable semi-annually  in  arrears and  are  cumulative. No  dividend  or  other
distribution  (other than  dividends payable  in Triarc  Common Shares  or other
shares ranking junior to the Redeemable
 
                                      145
 
<PAGE>
Convertible Preferred Stock) may be paid on  any Triarc Common Shares or on  any
shares  ranking  on  a  parity  with or  junior  to  the  Redeemable Convertible
Preferred Stock, nor may shares of such stock be purchased, redeemed, retired or
acquired by Triarc, unless all  accrued dividends on the Redeemable  Convertible
Preferred Stock shall have been paid, with certain limited exceptions.
 
     In  the event  of voluntary  or involuntary  liquidation or  dissolution of
Triarc, to  the extent  assets remain  after payment  of creditors  in full  and
before any distribution to holders of Triarc Common Shares, Triarc Junior Serial
Preferred  Stock or  other shares ranking  junior to  the Redeemable Convertible
Preferred Stock, the holders  of Convertible Preferred Stock,  on a parity  with
the  holders of Triarc Serial Preferred Stock,  would be entitled to receive the
stated value  of  such  shares, plus  an  amount  equal to  accrued  and  unpaid
dividends  to  the  date  of  payment,  ratably  in  proportion  to  their  full
preferential amounts. The  merger or consolidation  of Triarc with  or into  any
other  corporation, the merger of any other  corporation with or into the Triarc
or the sale, lease or  conveyance of all or  substantially all its assets  would
not be deemed to be a liquidation or dissolution for this purpose.
 
     Except  as required by law and except with respect to certain extraordinary
matters  as  set  forth  in  the  Triarc  Articles,  the  shares  of  Redeemable
Convertible Preferred Stock have no voting rights.
 
     Triarc  may redeem  all, but  not less  than all,  of the  then outstanding
Redeemable Convertible Preferred Stock at any  time on or after April 23,  1998,
and  must  redeem any  shares of  Redeemable  Convertible Preferred  Stock which
remain outstanding on April 23,  2005, in each such case,  at a price per  share
equal  to  the  then  applicable  redemption  price  (which  is  $12.84  if such
redemption is made during the twelve month period commencing April 23, 1998, and
which reduces by $.12 for each  subsequent twelve month period thereafter  until
April 23, 2005, when it becomes $12.00) plus accrued but unpaid dividends to the
date of redemption.
 
     Each  share of Redeemable Convertible Preferred Stock is convertible at any
time by the  holder thereof into  Triarc Common Shares.  Upon the conversion  of
such  shares, the  $12.00 per share  Stated Value of  the Redeemable Convertible
Preferred Stock is credited against the  $14.40 per share conversion price  (the
'Conversion Price') for the Triarc Common Shares, which Conversion Price will be
subject  to  certain adjustments.  If  the holder  of  the shares  of Redeemable
Convertible Preferred  Stock  being converted  is  not  a Posner  Entity  or  an
affiliate  thereof, such conversion will be for  shares of Triarc Class A Common
Stock. If the  holder of the  shares of Redeemable  Convertible Preferred  Stock
being converted is a Posner Entity or an affiliate thereof, such conversion will
be  for  shares of  Triarc Class  B Common  Stock. Triarc  may require  that the
holders  thereof  convert  all  outstanding  shares  of  Redeemable  Convertible
Preferred  Stock into Triarc  Common Shares, if,  at any time  during the period
from April 23, 1996  through April 22,  1998, the closing price  for a share  of
Triarc  Class A Common Stock is at least $18.50, subject to certain adjustments,
for at least 20 out  of any 30 consecutive trading  days. If such conversion  is
required,  the holder of  the Triarc Common Shares  received upon conversion may
(within 30  days following  such conversion)  require Triarc  to repurchase  the
Triarc  Common Shares  received upon  such conversion at  a price  of $21.00 per
share, subject to  certain adjustments. If,  upon any conversion,  Triarc is  in
arrears  on  three  or  more  dividend  payments  on  the  shares  of Redeemable
Convertible Preferred  Stock, the  converting holder  may, at  his, her  or  its
option, either have all or part of such arrearage, up to $2.40 per Triarc Common
Share received upon conversion, credited against the Conversion Price, or retain
the right to receive such arrearage.
 
     Pursuant  to an agreement between Triarc  and the holders of the Redeemable
Convertible Preferred Stock, under certain  circumstances, Triarc will have  the
right  to  purchase  or designate  another  purchaser for  shares  of Redeemable
Convertible Preferred Stock  (or Triarc Common  Shares received upon  conversion
thereof), if a holder of such shares proposes to sell them.
 
     Pursuant  to an agreement between Triarc  and the holders of the Redeemable
Convertible Preferred Stock, the holders of the Redeemable Convertible Preferred
Stock have the  right to demand  that Triarc register  the Triarc Common  Shares
into  which  the Redeemable  Convertible Preferred  Stock  may be  converted, at
Triarc's expense at any two times while such stock is outstanding and also  have
certain  incidental registration  rights in  the event  of certain registrations
being made by Triarc.
 
     Except for the conversion rights described  above, no holder of any of  the
shares  of Redeemable Convertible  Preferred Stock has the  right to purchase or
subscribe for any shares of Triarc capital stock
 
                                      146
 
<PAGE>
of any class  of Triarc whether  heretofore or hereafter  authorized or  issued,
whether issued for cash, property, services or by way of dividend.
 
TRIARC SERIAL PREFERRED SHARES AND TRIARC JUNIOR PREFERRED SHARES
 
     Each  series of Triarc  Serial Preferred Stock  ranks on a  parity with the
Redeemable Convertible Preferred Stock  and each other  series of Triarc  Serial
Preferred  Stock. Each Series of Triarc Junior Preferred Stock ranks on a parity
with each other series of Triarc Junior Serial Preferred Stock and is junior  to
the  Redeemable Convertible  Preferred Stock  and each  series of  Triarc Serial
Preferred Stock.  Shares of  Triarc  Serial Preferred  Stock and  Triarc  Junior
Serial  Preferred Stock may be issued by action  of the Triarc Board at any time
or from  time to  time without  shareholder action.  For each  series of  Triarc
Serial  Preferred Stock and each series  of Triarc Junior Serial Preferred Stock
approved for issuance  by the  Triarc Board of  Directors, the  Triarc Board  of
Directors  will fix the following terms: (a) the designation of the series which
may be by distinguishing number, letter  or title, (b) the authorized number  of
shares of the series, which may (except where otherwise provided in the creation
of  the series) be increased or decreased from  time to time by the Triarc Board
before or after the issuance thereof (but not below the number of shares thereof
then outstanding), (c) the dividend rate or rates of the series, (d) the date on
which and  the period  or periods  for which  dividends, if  declared, shall  be
payable  and  the  date  or  dates from  which  dividends  shall  accrue  and be
cumulative, (e) the  redemption rights  and prices, if  any, (f)  the terms  and
amounts  of the sinking fund,  if any, (g) the amounts  payable on shares of the
series in the event of any voluntary or involuntary liquidation, dissolution  or
winding  up of the affairs of Triarc, (h)  whether the shares of the series will
be convertible into Triarc Common  Shares or shares of  any other class and,  if
so, the conversion rate or rates or price or prices, any adjustments thereof and
all  other terms and conditions upon which  such conversion may be made, and (i)
restrictions on the issuance of shares of the same or any other class or series.
The holders of Triarc Serial Preferred Stock and Triarc Junior Serial  Preferred
Stock  will each be entitled  to the same voting rights  as holders of shares of
Triarc Class A Common  Stock, voting with  such holders as  a single class,  and
will  each have  certain additional voting  rights, voting as  a separate class,
including the right of each class to elect two members of the Triarc Board  upon
certain  dividend arrearages. The issuance of  shares of Triarc Serial Preferred
Stock or Triarc Junior Serial Preferred  Stock could have a materially  dilutive
effect  on  the  holders  of  Triarc Common  Shares,  could  result  in material
restrictions on Triarc's ability to pay  dividends or make distributions on  the
outstanding  Triarc Common  Shares and could  materially reduce  the amount that
might otherwise  be  available to  holders  of  Triarc Common  Shares  upon  any
liquidation, dissolution or winding up of Triarc.
 
                      SUBMISSION OF STOCKHOLDER PROPOSALS
            FOR SEPSCO'S 1994 ANNUAL MEETING OF SEPSCO STOCKHOLDERS
 
     In  the event the Merger  is not consummated for  any reason, in accordance
with the  rules  of  the  Commission, certain  stockholder  proposals  that  are
received  by  the  Secretary  of SEPSCO  at  SEPSCO's  corporate  headquarters a
reasonable time before proxies  are solicited by the  SEPSCO Board for  SEPSCO's
1994  Annual Meeting of Stockholders must be included in the proxy statement and
proxy relating to the 1994 Annual Meeting of SEPSCO Stockholders.
 
            CERTAIN LEGAL MATTERS, EXPERTS AND REGULATORY APPROVALS
 
FEDERAL AND STATE APPROVALS
 
     No Federal or state regulatory requirements  remain to be complied with  in
order to consummate the Merger.
 
LEGAL OPINIONS
 
     The  validity of the shares of Triarc Class  A Common Stock to be issued in
the Merger will be passed upon for Triarc by Baker & Hostetler, Cleveland, Ohio.
 
                                      147
 
<PAGE>
EXPERTS
 
     The audited consolidated financial statements of Triarc Companies, Inc. and
Subsidiaries, of Southeastern  Public Service  Company and  Subsidiaries and  of
Graniteville    Company    and    Subsidiaries    included    in    this   Proxy
Statement-Prospectus have been  audited by  Arthur Andersen  & Co.,  independent
certified public accountants, as indicated in their reports with respect thereto
and are included herein upon the authority of such firm as experts in accounting
and auditing.
 
DELAWARE BUSINESS COMBINATION STATUTE
 
     SEPSCO  is incorporated in the  State of Delaware. Section  203 of the DGCL
restricts certain 'business combinations' between a Delaware corporation and  an
'interested  stockholder,' as such terms are defined in such Section. Generally,
an 'interested stockholder' is defined as  any person who owns beneficially  15%
or  more  of  a  Delaware  corporation's  voting  stock.  As  a  result  of  the
Reorganization, Triarc is  an 'interested stockholder'  for purposes of  Section
203 of the DGCL. Accordingly, approval of the Merger Agreement is subject to the
requirements  of Section 203 of the DGCL. In addition to any other vote required
to approve the Merger Agreement, adoption  of the Merger Agreement requires  the
affirmative vote of the holders of at least two-thirds of the outstanding shares
of  SEPSCO Voting Stock,  other than those  held by Triarc  or any subsidiary of
Triarc, entitled to vote at the Special Meeting.
 
MISCELLANEOUS
 
     It is expected that representatives of Arthur Andersen & Co., Triarc's  and
SEPSCO's  independent public accountants, will be present at the Special Meeting
to respond  to  appropriate questions  of  SEPSCO  Stockholders and  to  make  a
statement if they so desire.
 
     SEPSCO  knows of no  matters to be  presented at the  Special Meeting other
than  the  matters   set  forth   in  the   attached  Notice   and  this   Proxy
Statement-Prospectus.  However,  if any  other matters  come before  the Special
Meeting, it is  intended that the  holder of  the proxies will  vote thereon  in
their discretion.
 
     No  person  has  been  authorized  to  give  any  information  or  make any
representation on behalf  of Triarc, SEPSCO  or Mergerco not  contained in  this
Proxy   Statement-Prospectus,  and  if  given   or  made,  such  information  or
representation must not be relied upon as having been authorized.
 
                                          By order of the Board of Directors
 
                                          CURTIS S. GIMSON
                                          Senior Vice President and Associate
                                          General Counsel, and Secretary
 

777 South Flagler Drive
West Palm Beach, Florida 33401
March 14, 1994

 
                                      148

<PAGE>
                         INDEX TO FINANCIAL STATEMENTS
 
<TABLE>
<CAPTION>
                                                                                                            PAGE
                                                                                                            -----
<S>                                                                                                         <C>
TRIARC COMPANIES INC.:
     Report of Independent Certified Public Accountants..................................................     F-2
     Consolidated Balance Sheets as of April 30, 1992 and 1993...........................................     F-3
     Consolidated Statements of Operations for the Years Ended April 30, 1991, 1992 and 1993.............     F-4
     Consolidated Statements of Additional Capital for the Years Ended April 30, 1991, 1992 and 1993.....     F-5
     Consolidated Statements of Cash Flows for the Years Ended April 30, 1991, 1992 and 1993.............     F-6
     Notes to Consolidated Financial Statements..........................................................     F-8
     Condensed Consolidated Balance Sheets as of April 30, 1993 and October 31, 1993.....................    F-35
     Condensed Consolidated Statements of Operations for the Six Months Ended October 31, 1992 and
      1993...............................................................................................    F-36
     Condensed Consolidated Statements of Cash Flows for the Six Months Ended October 31, 1992 and
      1993...............................................................................................    F-37
     Notes to Condensed Consolidated Financial Statements................................................    F-38
SOUTHEASTERN PUBLIC SERVICE COMPANY:
     Report of Independent Certified Public Accountants..................................................    F-48
     Consolidated Balance Sheets as of February 29, 1992 and February 28, 1993...........................    F-49
     Consolidated Statements of Operations and Retained Earnings (Deficit) for the Years Ended February
      28 or 29, 1991, 1992 and 1993......................................................................    F-50
     Consolidated Statements of Cash Flows for the Years Ended February 28 or 29, 1991, 1992 and 1993....    F-51
     Notes to Consolidated Financial Statements..........................................................    F-53
     Condensed Consolidated Balance Sheets as of February 28, 1993 and November 30, 1993.................    F-70
     Condensed Consolidated Statements of Operations for the Nine Months Ended November 30, 1992 and
      1993...............................................................................................    F-71
     Condensed Consolidated Statements of Cash Flows for the Nine Months Ended November 30, 1992 and
      1993...............................................................................................    F-72
     Notes to Condensed Consolidated Financial Statements................................................    F-73
GRANITEVILLE COMPANY:
     Report of Independent Certified Public Accountants..................................................    F-84
     Consolidated Balance Sheets as of March 1, 1992 and February 28, 1993...............................    F-85
     Consolidated Statements of Income and Retained Earnings for the Years Ended March 3, 1991, March 1,
      1992 and February 28, 1993.........................................................................    F-86
     Consolidated Statements of Cash Flows for the Years Ended March 3, 1991, March 1, 1992 and February
      28, 1993...........................................................................................    F-87
     Notes to Consolidated Financial Statements..........................................................    F-88
     Condensed Consolidated Balance Sheets as of February 28, 1993 and November 28, 1993.................   F-100
     Condensed Consolidated Statements of Income for the Nine Months Ended November 29, 1992 and November
      28, 1993...........................................................................................   F-101
     Condensed Consolidated Statements of Cash Flows for the Nine Months Ended November 29, 1992 and
      November 28, 1993..................................................................................   F-102
     Notes to Condensed Consolidated Financial Statements................................................   F-103
TRIARC COMPANIES, INC.:
     Loss Per Share Calculation..........................................................................   F-106
     Pro Forma Loss Per Share Calculation................................................................   F-107
</TABLE>
 
                                      F-1

<PAGE>
               REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
 
To the Board of Directors and Stockholders,
  TRIARC COMPANIES, INC.:
 
     We  have  audited the  accompanying consolidated  balance sheets  of Triarc
Companies, Inc. (an Ohio corporation, formerly DWG Corporation) and subsidiaries
as of  April 30,  1992 and  1993,  and the  related consolidated  statements  of
operations, additional capital and cash flows for each of the three years in the
period  ended April 30, 1993. These  financial statements are the responsibility
of the Company's  management. Our  responsibility is  to express  an opinion  on
these financial statements based on our audits.
 
     We  conducted  our audits  in accordance  with generally  accepted auditing
standards. Those standards require that we plan and perform the audit to  obtain
reasonable assurance about whether the financial statements are free of material
misstatement.  An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also  includes
assessing  the  accounting principles  used  and significant  estimates  made by
management, as well as evaluating the overall financial statement  presentation.
We believe that our audits provide a reasonable basis for our opinion.
 
     In  our opinion, the financial statements referred to above present fairly,
in all material respects, the financial  position of Triarc Companies, Inc.  and
subsidiaries  as of April 30, 1992 and 1993, and the results of their operations
and their cash flows for each of the  three years in the period ended April  30,
1993 in conformity with generally accepted accounting principles.
 
     As  discussed in Note 1 to the consolidated financial statements, effective
May 1, 1992, the Company changed its  method of accounting for income taxes  and
postretirement benefits other than pensions.
 
                                          ARTHUR ANDERSEN & CO.
 
Miami, Florida,
  August 12, 1993.
 
                                      F-2
 
<PAGE>
                    TRIARC COMPANIES, INC. AND SUBSIDIARIES
                          CONSOLIDATED BALANCE SHEETS
 
<TABLE>
<CAPTION>
                                                                                                  APRIL 30,
                                                                                             --------------------
                                                                                               1992        1993
                                                                                             --------    --------
                                                                                                (IN THOUSANDS)
<S>                                                                                          <C>         <C>
                                          ASSETS
Current assets:
     Cash and equivalents.................................................................   $ 20,514    $ 96,635
     Restricted cash and equivalents (Note 4).............................................      8,200       5,589
     Receivables, net (Note 5)............................................................     75,030     116,257
     Inventories (Note 6).................................................................    136,662      98,270
     Deferred income taxes (Note 10)......................................................      --         21,365
     Net current assets of discontinued operations (Note 3)...............................     10,474       6,823
     Other current assets.................................................................      8,340      14,407
                                                                                             --------    --------
          Total current assets............................................................    259,220     359,346
                                                                                             --------    --------
Restricted cash and short-term investments of insurance operations (Note 4)...............     26,457      18,271
Properties, net (Note 8)..................................................................    256,180     237,853
Unamortized costs in excess of net assets of acquired companies (Note 1)..................    184,909     186,572
Net non-current assets of discontinued operations (Note 3)................................     56,225      60,086
Other assets (Note 1).....................................................................     38,179      48,534
                                                                                             --------    --------
                                                                                             $821,170    $910,662
                                                                                             --------    --------
                                                                                             --------    --------
                      LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
Current liabilities:
     Current portion of long-term debt (Note 11)..........................................   $109,849    $ 43,100
     Short-term debt......................................................................     19,464       --
     Accounts payable (Notes 7 and 16)....................................................    100,479      71,729
     Other current liabilities (Note 9)...................................................     62,000     111,011
                                                                                             --------    --------
          Total current liabilities.......................................................    291,792     225,840
                                                                                             --------    --------
Long-term debt (Note 11)..................................................................    289,758     488,654
Insurance loss reserves (Notes 1 and 7)...................................................     84,222      76,763
Deferred income taxes (Note 10)...........................................................     12,541      35,991
Deposits and other liabilities............................................................     15,165      17,157
Commitments and contingencies (Notes 7, 10, 17 and 18)
Minority interests........................................................................     41,210      29,850
Redeemable preferred stock, $12 stated value; authorized 6,000,000 shares in 1993, issued
  5,982,866 shares; aggregate liquidation preference and redemption amount $71,794,000
  (Note 12)...............................................................................      --         71,794
Stockholders' equity (deficit) (Note 13):
     Cumulative convertible preferred stock, $1 par value.................................         31       --
     Class A common stock, $.10 par value; authorized 40,000,000 and 75,000,000 shares,
      issued 27,006,336 and 28,251,805 shares.............................................      2,701       2,825
     Class B common stock, $.10 par value; authorized 12,000,000 shares in 1993, none
      issued..............................................................................      --          --
     Additional paid-in capital...........................................................     37,968      52,372
     Retained earnings (deficit)..........................................................     53,920      (6,067)
     Less 1,117,274 and 7,100,145 Class A common shares in treasury at cost...............     (8,315)    (80,109)
     Other................................................................................        177      (4,408)
                                                                                             --------    --------
          Total stockholders' equity (deficit)............................................     86,482     (35,387)
                                                                                             --------    --------
                                                                                             $821,170    $910,662
                                                                                             --------    --------
                                                                                             --------    --------
</TABLE>
 
          See accompanying notes to consolidated financial statements.
 
                                      F-3
 
<PAGE>
                    TRIARC COMPANIES, INC. AND SUBSIDIARIES
                     CONSOLIDATED STATEMENTS OF OPERATIONS
 
<TABLE>
<CAPTION>
                                                                                    YEAR ENDED APRIL 30,
                                                                           --------------------------------------
                                                                              1991          1992          1993
                                                                           ----------    ----------    ----------
                                                                               (IN THOUSANDS EXCEPT PER SHARE
                                                                                          AMOUNTS)
<S>                                                                        <C>           <C>           <C>
Revenues:
     Net sales..........................................................   $  977,145    $1,029,613    $1,011,015
     Royalties, franchise fees and other revenues.......................       50,017        45,090        47,259
                                                                           ----------    ----------    ----------
                                                                            1,027,162     1,074,703     1,058,274
                                                                           ----------    ----------    ----------
Costs and expenses:
     Cost of sales......................................................      767,485       797,968       766,795
     Selling, general and administrative expenses (Note 19).............      214,629       188,179       203,662
     Facilities relocation and corporate restructuring (Note 19)........        3,785         4,318        43,000
     Provision for doubtful accounts from affiliates (Note 16)..........       17,959        25,686        10,358
                                                                           ----------    ----------    ----------
                                                                            1,003,858     1,016,151     1,023,815
                                                                           ----------    ----------    ----------
          Operating profit..............................................       23,304        58,552        34,459
                                                                           ----------    ----------    ----------
Interest expense (Note 19)..............................................      (66,761)      (71,832)      (72,830)
Other income (expense), net (Note 15)...................................        9,776         6,542          (920)
                                                                           ----------    ----------    ----------
                                                                              (56,985)      (65,290)      (73,750)
                                                                           ----------    ----------    ----------
          Loss from continuing operations before income taxes, minority
            interests, extraordinary items and cumulative effect of
            changes in accounting principles............................      (33,681)       (6,738)      (39,291)
Benefit from (provision for) income taxes (Note 10).....................       15,554        (2,956)       (8,608)
                                                                           ----------    ----------    ----------
                                                                              (18,127)       (9,694)      (47,899)
Minority interests in net losses (income)...............................          626          (513)        3,350
                                                                           ----------    ----------    ----------
          Loss from continuing operations...............................      (17,501)      (10,207)      (44,549)
Income (loss) from discontinued operations, net of income taxes and
  minority interests (Note 3)...........................................          (55)        2,705        (2,430)
                                                                           ----------    ----------    ----------
          Loss before extraordinary items and cumulative effect of
            changes in accounting principles............................      (17,556)       (7,502)      (46,979)
Extraordinary items, net (Notes 10 and 11)..............................          703        --            (6,611)
Cumulative effect of changes in accounting principles, net (Note 1).....       --            --            (6,388)
                                                                           ----------    ----------    ----------
          Net loss......................................................      (16,853)       (7,502)      (59,978)
Preferred stock dividend requirements (Notes 12 and 13).................          (11)          (11)         (121)
                                                                           ----------    ----------    ----------
          Net loss applicable to common stockholders....................   $  (16,864)   $   (7,513)   $  (60,099)
                                                                           ----------    ----------    ----------
                                                                           ----------    ----------    ----------
Loss per share (Note 1):
     Continuing operations..............................................        $(.68)        $(.39)       $(1.73)
     Discontinued operations............................................           --           .10          (.09)
     Extraordinary items................................................          .03            --          (.26)
     Cumulative effect of changes in accounting principles..............           --            --          (.25)
                                                                                -----         -----        ------
                                                                                $(.65)        $(.29)       $(2.33)
                                                                                -----         -----        ------
                                                                                -----         -----        ------
</TABLE>
 
          See accompanying notes to consolidated financial statements.
 
                                      F-4
 
<PAGE>
                    TRIARC COMPANIES, INC. AND SUBSIDIARIES
                 CONSOLIDATED STATEMENTS OF ADDITIONAL CAPITAL
 
<TABLE>
<CAPTION>
                                                                                        YEAR ENDED APRIL 30,
                                                                                   ------------------------------
                                                                                    1991       1992        1993
                                                                                   -------    -------    --------
                                                                                           (IN THOUSANDS)
<S>                                                                                <C>        <C>        <C>
Additional paid-in capital:
     Balance at beginning of year...............................................   $37,880    $37,890    $ 37,968
     Common stock issued:
          In connection with the Reorganization (Note 2)........................     --         --          9,567
          Grant of restricted shares (Note 14)..................................     --         --          4,797
          Conversion of preferred stock (Note 13)...............................     --         --             15
          Conversion of debentures (Note 13)....................................        10         78          38
     Redemption of preferred stock (Note 13)....................................     --         --            (13)
                                                                                   -------    -------    --------
     Balance at end of year.....................................................   $37,890    $37,968    $ 52,372
                                                                                   -------    -------    --------
                                                                                   -------    -------    --------
Retained earnings (deficit):
     Balance at beginning of year...............................................   $78,297    $61,433    $ 53,920
     Net loss...................................................................   (16,853)    (7,502)    (59,978)
     Dividends on preferred stock...............................................       (11)       (11)         (9)
                                                                                   -------    -------    --------
     Balance at end of year.....................................................   $61,433    $53,920    $ (6,067)
                                                                                   -------    -------    --------
                                                                                   -------    -------    --------
Treasury stock:
     Balance at beginning of year...............................................   $(8,315)   $(8,315)   $ (8,315)
     Exchange of redeemable preferred shares for common (Notes 2 and 12)........     --         --        (71,794)
                                                                                   -------    -------    --------
     Balance at end of year.....................................................   $(8,315)   $(8,315)   $(80,109)
                                                                                   -------    -------    --------
                                                                                   -------    -------    --------
Other (Note 13):
     Balance at beginning of year...............................................   $(1,538)   $(1,207)   $    177
     Grant of restricted shares -- unearned compensation (Note 14)..............     --         --         (4,824)
     Net unrealized gains on marketable securities of insurance operations, net
       of minority interests....................................................       331      1,384         239
                                                                                   -------    -------    --------
     Balance at end of year.....................................................   $(1,207)   $   177    $ (4,408)
                                                                                   -------    -------    --------
                                                                                   -------    -------    --------
</TABLE>
 
          See accompanying notes to consolidated financial statements.
 
                                      F-5
 
<PAGE>
                    TRIARC COMPANIES, INC. AND SUBSIDIARIES
                     CONSOLIDATED STATEMENTS OF CASH FLOWS
 
<TABLE>
<CAPTION>
                                                                                      YEAR ENDED APRIL 30,
                                                                                ---------------------------------
                                                                                  1991        1992        1993
                                                                                --------    --------    ---------
                                                                                         (IN THOUSANDS)
<S>                                                                             <C>         <C>         <C>
Cash flows from operating activities:
     Net loss................................................................   $(16,853)   $ (7,502)   $ (59,978)
     Adjustments to reconcile net loss to net cash and equivalents provided
       by operating activities:
          Depreciation of properties.........................................     28,861      31,224       31,196
          Amortization of costs in excess of net assets......................      5,023       5,314        6,785
          Amortization of deferred debt discount and financing costs.........      5,287       6,536        6,396
          Write-off of deferred financing costs..............................      --          --           3,741
          Provision for doubtful accounts (including amounts due from former
            affiliates)......................................................     22,274      28,740       14,141
          Provision for facilities relocation and corporate restructuring....      3,785       4,318       43,000
          Loss (gain) on sales of assets, net................................      1,915        (388)      (2,974)
          Gain on purchase of debentures for sinking fund....................     (3,510)     (4,650)        (117)
          Decrease (increase) in restricted cash securing payment of
            insurance losses.................................................      7,131      (3,198)       8,186
          Minority interests, net of dividends paid..........................       (356)        501       (3,607)
          Loss (income) from discontinued operations.........................         55      (2,705)       2,430
          Cumulative effect of changes in accounting principles..............      --          --           6,388
          Decrease (increase) in:
               Restricted cash and equivalents...............................        172      (2,715)       2,611
               Receivables...................................................     21,462      (5,103)       1,143
               Inventories...................................................     (5,183)    (13,330)      12,862
               Other current assets..........................................     (5,761)     13,002       (7,425)
          Increase (decrease) in:
               Accounts payable and other current liabilities................     19,751       5,323      (15,097)
               Insurance loss reserves.......................................      1,672      (2,236)      (7,459)
               Deferred income taxes.........................................     (5,405)     (6,747)     (11,024)
               Other liabilities.............................................    (21,956)     (1,462)       3,075
          Other, net.........................................................     (6,552)      3,006        2,149
                                                                                --------    --------    ---------
               Net cash and equivalents provided by operating activities.....     51,812      47,928       36,422
                                                                                --------    --------    ---------
Cash flows from investing activities:
     Proceeds from sales of assets...........................................      2,068       1,929       39,464
     Capital expenditures....................................................    (32,233)    (22,571)     (23,758)
     Purchase of minority interests..........................................      --          --         (17,200)
     Redemption of investment in affiliate...................................      --          --           2,100
                                                                                --------    --------    ---------
          Net cash and equivalents provided (used) by investing activities...    (30,165)    (20,642)         606
                                                                                --------    --------    ---------
Cash flows from financing activities:
     Issuance of Class A common stock........................................      --          --           9,650
     Proceeds from long-term debt............................................     21,096       5,800      396,595
     Repayment of long-term debt.............................................    (29,202)    (69,658)    (329,332)
     Deferred financing costs................................................      --         (6,900)     (25,820)
     Increase (decrease) in short-term debt..................................      6,078      13,386      (14,745)
     Payment of dividends and redemption of preferred stock..................        (11)        (11)         (24)
                                                                                --------    --------    ---------
          Net cash and equivalents provided (used) by financing activities...     (2,039)    (57,383)      36,324
                                                                                --------    --------    ---------
Net cash provided (used) by continuing operations............................     19,608     (30,097)      73,352
Net cash provided (used) by discontinued operations..........................       (741)      4,772        2,769
                                                                                --------    --------    ---------
Net increase (decrease) in cash and equivalents..............................     18,867     (25,325)      76,121
Cash and equivalents at beginning of year....................................     26,972      45,839       20,514
                                                                                --------    --------    ---------
Cash and equivalents at end of year..........................................   $ 45,839    $ 20,514    $  96,635
                                                                                --------    --------    ---------
                                                                                --------    --------    ---------
</TABLE>
 
                                      F-6
 
<PAGE>
                    TRIARC COMPANIES, INC. AND SUBSIDIARIES
              CONSOLIDATED STATEMENTS OF CASH FLOWS -- (CONTINUED)
 
<TABLE>
<CAPTION>
                                                                                      YEAR ENDED APRIL 30,
                                                                                ---------------------------------
                                                                                  1991        1992        1993
                                                                                --------    --------    ---------
                                                                                         (IN THOUSANDS)
<S>                                                                             <C>         <C>         <C>
Supplemental disclosures of cash flow information:
     Cash paid (received) during the year for:
          Interest expense...................................................   $ 60,329    $ 62,063    $  61,475
                                                                                --------    --------    ---------
                                                                                --------    --------    ---------
          Income taxes (refunds), net........................................   $(12,639)   $ (6,718)   $  17,156
                                                                                --------    --------    ---------
                                                                                --------    --------    ---------
Supplemental schedule of noncash investing and financing activities:
     Total capital expenditures..............................................   $ 41,442    $ 31,253    $  27,207
     Amounts representing capitalized leases and other secured financing.....     (9,209)     (8,682)      (3,449)
                                                                                --------    --------    ---------
          Capital expenditures paid in cash..................................   $ 32,233    $ 22,571    $  23,758
                                                                                --------    --------    ---------
                                                                                --------    --------    ---------
</TABLE>
 
     As  described  more fully  in  Note 2  of  Notes to  Consolidated Financial
Statements, in April 1993, Triarc  issued 5,982,866 shares of its  newly-created
redeemable  preferred stock  in a  one-for-one exchange  for its  Class A common
stock owned by  an affiliate  of Victor Posner,  the former  Chairman and  Chief
Executive  Officer of Triarc. Such transaction,  which resulted in a $71,794,000
increase in redeemable preferred stock and  an equal increase in Class A  common
shares  held in  treasury at  cost, is  not reflected  in the  1993 consolidated
statement of cash flows due to its noncash nature.
 
     In July  1991  Triarc's  subsidiary,  RC/Arby's  Corporation  ('RC/Arby's',
formerly  known as Royal Crown  Corporation), restructured a significant portion
of its outstanding indebtedness. Due to  its noncash nature, the aspect of  such
restructuring  representing the exchange of one form of indebtedness for another
on the part of RC/Arby's is not reflected in the 1992 consolidated statement  of
cash  flows. Also in  connection with such restructuring  of the indebtedness of
RC/Arby's, the  shares of  preferred  stock of  RC/Arby's  held by  Triarc  were
converted  into  common  stock  of RC/Arby's  resulting  in  Triarc  then owning
approximately 88.7% of RC/Arby's outstanding voting securities. Such  conversion
resulted  in an  increase of approximately  $12,788,000 in  unamortized costs in
excess of  net assets  of acquired  companies and  a corresponding  increase  in
minority  interests liability on a consolidated  basis which, due to its noncash
nature, is not reflected in the 1992 consolidated statement of cash flows.
 
     In  December  1991  Triarc's   subsidiary,  National  Propane   Corporation
('National   Propane'),  acquired  from  a   subsidiary  of  American  Financial
Corporation $5,000,000 aggregate principal amount of National Propane's 13  1/8%
senior  subordinated debentures  in exchange for  a promissory note.  Due to its
noncash nature, such exchange of debt is not reflected in the 1992  consolidated
statement of cash flows.
 
          See accompanying notes to consolidated financial statements.
 
                                      F-7

<PAGE>
                    TRIARC COMPANIES, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                 APRIL 30, 1993
 
(1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
 
PRINCIPLES OF CONSOLIDATION
 
     The  consolidated  financial statements  include,  as more  fully described
below, the  accounts of  Triarc Companies,  Inc. (formerly  DWG Corporation  and
referred  to herein as 'Triarc' and, collectively with its subsidiaries, 'Triarc
Companies') and  its  wholly-owned subsidiaries,  National  Propane  Corporation
('National   Propane'),   Home   Furnishing   Acquisition   Corporation   ('Home
Furnishing') and  Citrus Acquisition  Corporation  ('Citrus') for  their  fiscal
years  ending April 30, Southeastern Public Service Company ('SEPSCO' -- a 71.1%
owned subsidiary)  and  Graniteville  Company ('Graniteville'  --  a  51%  owned
subsidiary of Triarc and 85.8% owned by Triarc Companies) for their fiscal years
ending  on or about February  28 and Wilson Brothers  ('Wilson' -- a 58.6% owned
subsidiary) and CFC Holdings Corp. ('CFC  Holdings' -- a 94.6% owned  subsidiary
of  Triarc and 98.4% owned  by Triarc Companies) for  their twelve months ending
March 31. All such ownership  percentages are as of  April 30, 1993 and  reflect
the acquisition of certain minority interests described in Note 2.
 
     The  accounts of SEPSCO, Graniteville, Wilson  and CFC Holdings included in
the consolidated financial statements which are as of a date prior to April  23,
1993  reflect  certain adjustments  to the  accounts  included in  the financial
statements of the respective  entities principally to reflect  the effects of  a
change  in control and related recapitalization of Triarc Companies on April 23,
1993, as described in Note  2, as well as  the recording of certain  significant
charges which are discussed further in Note 19.
 
     All significant intercompany balances and transactions have been eliminated
in consolidation.
 
INVENTORIES
 
     Triarc Companies' inventories, consisting of materials, labor and overhead,
are  valued at the lower of cost or  market. Cost is determined on the first-in,
first-out ('FIFO') basis  except for  inventories of the  textiles segment,  for
which cost is determined on the last-in, first-out ('LIFO') basis (see Note 6).
 
DEPRECIATION
 
     Depreciation  is computed principally on  the straight-line basis using the
estimated useful lives of the related major classes of properties: 3 to 9  years
for  automotive and  transportation equipment; 3  to 30 years  for machinery and
equipment; and 15 to 60 years  for buildings and improvements. Gains and  losses
arising from disposals are included in current operations.
 
UNAMORTIZED COSTS IN EXCESS OF NET ASSETS OF ACQUIRED COMPANIES
 
     Costs  in excess  of net assets  of acquired companies  are generally being
amortized  on  the  straight-line  basis  over  30  to  40  years.   Accumulated
amortization  of  such costs  was approximately  $38,245,000 and  $44,353,000 at
April 30, 1992  and 1993,  respectively. The amount  of impairment,  if any,  in
'Unamortized  costs in excess of net  assets of acquired companies' ('Goodwill')
is measured  based on  projected future  results of  operations. To  the  extent
future results of operations of those subsidiaries to which the Goodwill relates
through the period such Goodwill is being amortized are sufficient to absorb the
amortization  of Goodwill, Triarc Companies has deemed there to be no impairment
of Goodwill.
 
AMORTIZATION OF DEFERRED FINANCING COSTS AND DEBT DISCOUNT
 
     Deferred financing  costs  and  original  issue  debt  discount  are  being
amortized  as interest expense over  the lives of the  respective debt using the
interest rate method. At  April 30, 1992 and  1993, $9,929,000 and  $29,028,000,
respectively,  of unamortized  deferred financing  costs are  included in 'Other
assets'. Unamortized original issue debt discount is reported as a reduction  of
related long-term debt in the accompanying consolidated balance sheets (see Note
11).
 
                                      F-8
 
<PAGE>
                    TRIARC COMPANIES, INC. AND SUBSIDIARIES
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
                                 APRIL 30, 1993
 
RESEARCH AND DEVELOPMENT
 
     Research  and development costs  are expensed during the  year in which the
costs are incurred and  amounted to $1,677,000 in  1991, $2,132,000 in 1992  and
$2,001,000 in 1993.
 
INCOME TAXES
 
     Triarc  files  a consolidated  Federal income  tax return  with its  80% or
greater owned subsidiaries, National Propane, Citrus, Home Furnishing and, since
July 1991,  CFC  Holdings.  Less  than  80%  owned  subsidiaries  file  separate
consolidated  Federal  income tax  returns  with their  respective subsidiaries.
Deferred income  taxes  are provided  to  recognize  the tax  effect  of  timing
differences between the recognition of income and expenses for tax and financial
statement purposes.
 
     Effective  May  1, 1992  Triarc  Companies adopted  Statement  of Financial
Accounting Standards ('SFAS') 109, 'Accounting  for Income Taxes' ('SFAS  109'),
issued  by the Financial Accounting Standards Board ('FASB') and did not restate
prior periods. Triarc Companies' early adoption of SFAS 109 resulted in a charge
of $4,852,000,  net  of  applicable minority  interests,  to  Triarc  Companies'
results of operations for the year ended April 30, 1993 ('Fiscal 1993') which is
reported in the 'Cumulative effect of changes in accounting principles'.
 
POSTRETIREMENT BENEFITS
 
     Effective  May  1,  1992  Triarc Companies  adopted  SFAS  106, 'Employers'
Accounting for Postretirement Benefits Other Than Pensions' ('SFAS 106'), issued
by the FASB. SFAS 106 requires that the expected cost of postretirement benefits
be charged to  expense during the  years that employees  render service.  Triarc
Companies'  early  adoption  of  the  new  standard  resulted  in  a  charge  of
$1,536,000, net of  applicable income  taxes and minority  interests, to  Triarc
Companies'  results of  operations for  the year ended  April 30,  1993 which is
reported in the 'Cumulative effect of changes in accounting principles'.
 
INSURANCE LOSS RESERVES
 
     Insurance loss reserves include  supplemental loss reserves of  $35,342,000
and  $29,693,000 at  the 1992  and 1993  balance sheet  dates, respectively. The
supplemental  loss  reserves  for  affiliated  company  business  are  based  on
actuarial  studies using historical loss experience. The balance of the reserves
are either  reported  by  the  unaffiliated  reinsurers,  calculated  by  Triarc
Companies  or are  based on  claims adjustors'  evaluations. Management believes
that the reserves are fairly stated. Adjustments to estimates recorded resulting
from subsequent actuarial evaluations or ultimate payments are reflected in  the
operations of the periods in which such adjustments become known.
 
FRANCHISE FEES AND ROYALTIES
 
     Franchise  fees are  recognized as income  when a  franchised restaurant is
opened. Franchise fees for multiple area developments represent the aggregate of
the franchise fees for the number of restaurants in the area development and are
recognized as  income when  each restaurant  is  opened in  the same  manner  as
franchise  fees for individual restaurants. Royalties  are based on a percentage
of restaurant sales of the franchised outlet and are accrued as earned.
 
LOSS PER SHARE
 
     Loss per  share  has been  computed  by  dividing net  loss  plus  dividend
requirements  on  Triarc Companies'  preferred  stocks by  the  weighted average
number of  outstanding shares  of common  stock during  the year.  The  weighted
average number of outstanding common shares was 25,853,000,
 
                                      F-9
 
<PAGE>
                    TRIARC COMPANIES, INC. AND SUBSIDIARIES
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
                                 APRIL 30, 1993
 
25,867,000  and 25,808,000 for  the years ended  April 30, 1991,  1992 and 1993,
respectively. The preferred  stock dividend requirements  deducted include  cash
dividends  paid and  dividend requirements  for each  year not  yet paid. Common
stock equivalents were not used to compute loss per share because such inclusion
would have been antidilutive.
 
RECLASSIFICATIONS
 
     Certain  amounts  included  in  the  prior  years'  consolidated  financial
statements   have  been  reclassified   to  conform  with   the  current  year's
presentation.
 
(2) THE REORGANIZATION AND RELATED MATTERS
 
     On April 23, 1993, DWG Acquisition  Group, LP ('DWG Acquisition'), a  newly
formed limited partnership controlled by Nelson Peltz and Peter W. May, acquired
control  of Triarc from  Victor Posner, the former  Chairman and Chief Executive
Officer  of  Triarc   Companies,  and   certain  entities   controlled  by   him
(collectively,   'Posner')  through  a  series   of  related  transactions  (the
'Reorganization').  Immediately  prior  to  the  Reorganization,  Posner   owned
approximately 46% of the outstanding common stock of Triarc.
 
     The  principal elements comprising the equity portion of the Reorganization
included the following components:
 
           DWG Acquisition purchased  from Posner 5,982,867  shares of  Triarc's
           Class  A common stock, par value $.10  per share (the 'Triarc Class A
           Common Stock'), representing approximately  28.6% of Triarc's  common
           equity  outstanding immediately after  the Reorganization, for $12.00
           per share, or an aggregate purchase price of $71,794,000.
 
           All of the  remaining shares  of the Class  A Common  Stock owned  by
           Posner  were  exchanged  for  shares  of  newly-created,  non-voting,
           convertible redeemable preferred stock of Triarc.
 
           The minority interests owned by Posner in CFC Holdings (4.5%), SEPSCO
           (6.2%) and  Wilson (4.9%)  were purchased  by Triarc  (the  'Minority
           Share   Acquisitions')  at  negotiated  purchase  prices  aggregating
           $17,200,000, resulting in a net increase of approximately  $8,700,000
           in unamortized costs in excess of net assets of acquired companies.
 
           Victor Posner and his son, Steven Posner, the former Vice Chairman of
           Triarc  Companies, resigned  as directors, officers  and employees of
           Triarc Companies and all of its subsidiaries. In connection with such
           resignations, Victor Posner did  not receive any severance  payments.
           However,  in order to induce Steven  Posner to resign, Triarc entered
           into a five  year consulting agreement  (the 'Consulting  Agreement')
           with   Steven  Posner  which  provides  for  an  initial  payment  of
           $1,000,000 at the commencement of the  term of such agreement and  an
           annual  consulting fee  of $1,000,000. The  Consulting Agreement does
           not require  Steven Posner  to provide  any substantial  services  to
           Triarc  and Triarc presently does not expect that it will receive any
           such services from him. As a result, the $6,000,000 aggregate  amount
           of payments required under the Consulting Agreement has been expensed
           in Fiscal 1993.
 
           Affiliates  of  Donaldson, Lufkin  & Jenrette  Securities Corporation
           ('DLJ') and of Merrill Lynch & Co. ('Merrill Lynch' and together with
           DLJ, the  'DLJ/Merrill Lynch  Investors')  purchased from  Triarc  an
           aggregate  of 833,332  newly issued shares  of Triarc  Class A Common
           Stock, representing approximately 4.0% of  the Triarc Class A  Common
           Stock  outstanding immediately  after the  Reorganization, for $12.00
           per share,  the same  price at  which DWG  Acquisition purchased  its
           Triarc  Class  A  Common  Stock.  The  aggregate  price  approximated
           $10,000,000 (the 'Equity Financing').
 
                                      F-10
 
<PAGE>
                    TRIARC COMPANIES, INC. AND SUBSIDIARIES
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
                                 APRIL 30, 1993
 
     Concurrently with the consummation  of the Reorganization (the  'Closing'),
certain  debt of Triarc and  its subsidiaries was refinanced  in order to reduce
borrowing costs  and to  make  available additional  funds for  general  working
capital   and  liquidity   purposes.  The   principal  refinancing  transactions
consummated in connection  with the  Reorganization were the  sale by  RC/Arby's
Corporation   ('RC/Arby's',  formerly  known  as  Royal  Crown  Corporation),  a
wholly-owned subsidiary  of CFC  Holdings, of  $225,000,000 aggregate  principal
amount  of its senior secured step-up rate  notes due 2000 (the 'Step-Up Notes')
and the establishment  of a  new $180,000,000 credit  facility for  Graniteville
(the 'Graniteville Credit Facility') providing for $80,000,000 of term loans and
$100,000,000 of revolving credit loans (see Note 11).
 
     The  following table summarizes the aggregate  sources and uses of funds in
connection with the Reorganization:
 
<TABLE>
<CAPTION>
                                                                                             (IN MILLIONS)
<S>                                                                                          <C>
Sources:
     RC/Arby's Step-Up Notes..............................................................      $ 225.0
     Graniteville Term Loan...............................................................         80.0
     Graniteville Revolving Credit Loan...................................................        100.0
     Equity Financing.....................................................................         10.0
                                                                                             -------------
          Total sources of funds..........................................................      $ 415.0
                                                                                             -------------
                                                                                             -------------
Uses:
     Repay debt owed to affiliates of American Financial Corporation ('AFC')..............      $ 159.1
     Repay Graniteville debt owed to its commercial lender................................         82.2
     Repay SEPSCO accounts receivable financing...........................................         12.7
     Transfer to Chesapeake Insurance Company Limited ('Chesapeake Insurance') a
      wholly-owned subsidiary of CFC Holdings.............................................         27.0
     Minority Share Acquisitions and settlement of amounts due to and from Posner.........         22.6
     Fees and expenses primarily related to the issuance of the Step-Up Notes and
      Graniteville Credit Facility........................................................         26.7
     Fund capital expenditures and working capital........................................         84.7
                                                                                             -------------
          Total uses of funds.............................................................      $ 415.0
                                                                                             -------------
                                                                                             -------------
</TABLE>
 
(3) DISCONTINUED OPERATIONS
 
     On July  22, 1993,  SEPSCO's  Board of  Directors  authorized the  sale  or
liquidation  of  SEPSCO's  utility  and  municipal  services,  refrigeration and
natural gas and oil businesses. Such  businesses of SEPSCO have been treated  as
discontinued  operations in Triarc Companies' consolidated financial statements.
The precise  timetable for  the sale  and liquidation  of SEPSCO's  discontinued
businesses  will depend upon its ability  to identify appropriate purchasers and
to negotiate  acceptable terms  for  the sale  of  such businesses  and  assets.
However,  SEPSCO currently  anticipates completing  such sale  or liquidation by
July 31,  1994. After  consideration  of a  $12,903,000 write-down  (before  tax
benefit  and minority  interests of $7,540,000)  in Fiscal 1993  relating to the
impairment of  certain unprofitable  properties and  accruals for  environmental
remediation  and losses on certain contracts  in progress reflected in operating
profit (loss)  of discontinued  operations summarized  below, and  based on  the
analysis  performed to  date, Triarc  expects that  such dispositions, including
results of  operations  through the  anticipated  disposal dates,  will  in  the
aggregate  not  result  in a  net  loss to  Triarc  Companies (see  Note  22 for
discussion of  subsequent  events).  Condensed  financial  information  for  the
discontinued
 
                                      F-11
 
<PAGE>
                    TRIARC COMPANIES, INC. AND SUBSIDIARIES
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
                                 APRIL 30, 1993
 
operations,   which  has   been  retroactively  classified   separately  in  the
accompanying consolidated financial statements, is as follows:
 
<TABLE>
<CAPTION>
                                                                                        APRIL 30,
                                                                                   --------------------
                                                                                     1992        1993
                                                                                   --------    --------
                                                                                      (IN THOUSANDS)
<S>                                                                                <C>         <C>
Balance Sheets
     Receivables, net...........................................................   $ 26,113    $ 25,178
     Inventories................................................................      3,524       2,845
     Other current assets.......................................................      1,412       1,774
     Current portion of long-term debt..........................................    (10,937)     (9,709)
     Accounts payable...........................................................     (1,813)     (2,662)
     Other current liabilities..................................................     (7,825)    (10,603)
                                                                                   --------    --------
          Net current assets of discontinued operations.........................   $ 10,474    $  6,823
                                                                                   --------    --------
                                                                                   --------    --------
     Properties, net............................................................   $ 93,977    $ 85,880
     Unamortized costs in excess of net assets of acquired companies............        228         202
     Other assets...............................................................         72          37
     Long-term debt.............................................................    (18,070)    (16,992)
     Deferred income taxes......................................................    (19,819)     (8,477)
     Deposits and other liabilities.............................................       (163)       (564)
                                                                                   --------    --------
          Net non-current assets of discontinued operations.....................   $ 56,225    $ 60,086
                                                                                   --------    --------
                                                                                   --------    --------
</TABLE>
 
<TABLE>
<CAPTION>
                                                                            YEAR ENDED APRIL 30,
                                                                      --------------------------------
                                                                        1991        1992        1993
                                                                      --------    --------    --------
                                                                               (IN THOUSANDS)
<S>                                                                   <C>         <C>         <C>
Results of Operations
     Revenues......................................................   $188,161    $200,353    $204,714
     Operating profit (loss).......................................      3,030       9,012      (3,568)
     Income (loss) before income taxes and minority interests......       (134)      6,665      (6,016)
     Benefit from (provision for) income taxes.....................         50      (2,500)      2,274
     Minority interests............................................         29      (1,460)      1,312
     Net income (loss).............................................        (55)      2,705      (2,430)
</TABLE>
 
(4) RESTRICTED CASH AND EQUIVALENTS
 
     Triarc Companies  has  $5,593,000  and  $5,264,000  of  cash  deposited  in
restricted   interest-bearing  accounts   as  of   April  30,   1992  and  1993,
respectively. Such deposits  secure outstanding  and standby  letters of  credit
principally  for the purpose of securing certain performance and other bonds. As
of April 30,  1992 and  1993, Triarc  Companies had  approximately $300,000  and
$325,000, respectively, held in an interest-bearing cash collateral account with
respect to state requirements for certain advertising promotions.
 
     In  addition, as of April 30, 1992  Triarc Companies had $2,307,000 held in
an interest-bearing escrow account  which was surrendered  in September 1992  in
payment of a judgment in certain litigation. Such judgment costs were charged to
operations  in the year ended  April 30, 1991 ('Fiscal  1991') ($900,000) and in
the year ended April 30, 1992  ('Fiscal 1992') ($1,407,000) and are included  in
'Other income (expense), net'.
 
     'Restricted  cash  and  short-term  investments  of  insurance  operations'
represent amounts which have been pledged as collateral under certain letters of
credit and reinsurance agreements to secure
 
                                      F-12
 
<PAGE>
                    TRIARC COMPANIES, INC. AND SUBSIDIARIES
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
                                 APRIL 30, 1993
 
future payment  of  losses reflected  in  the  insurance loss  reserves  in  the
accompanying consolidated balance sheets.
 
     Exclusive  of cash and short-term  investments of the insurance operations,
which are considered part of a larger pool of restricted investments, all highly
liquid investments with  a maturity of  three months or  less when acquired  are
considered cash equivalents.
 
(5) RECEIVABLES
 
     The following is a summary of the components of receivables:
 
<TABLE>
<CAPTION>
                                                                                        APRIL 30,
                                                                                   --------------------
                                                                                     1992        1993
                                                                                   --------    --------
                                                                                      (IN THOUSANDS)
<S>                                                                                <C>         <C>
Receivables:
     Trade......................................................................   $ 79,406    $123,486
     Affiliated.................................................................     34,730         134
                                                                                   --------    --------
                                                                                    114,136     123,620
                                                                                   --------    --------
Less allowance for doubtful accounts:
     Trade......................................................................      6,890       7,363
     Affiliated.................................................................     32,216       --
                                                                                   --------    --------
                                                                                     39,106       7,363
                                                                                   --------    --------
                                                                                   $ 75,030    $116,257
                                                                                   --------    --------
                                                                                   --------    --------
</TABLE>
 
     Affiliated  receivables and  related allowances arose  principally from the
providing of management services and equipment lease financing to certain former
affiliates of Triarc Companies in the ordinary course of business, as  described
in Note 16.
 
(6) INVENTORIES
 
     The following is a summary of the components of inventories:
 
<TABLE>
<CAPTION>
                                                                                         APRIL 30,
                                                                                    -------------------
                                                                                      1992       1993
                                                                                    --------    -------
                                                                                      (IN THOUSANDS)
<S>                                                                                 <C>         <C>
Raw materials....................................................................   $ 36,210    $24,655
Work in process..................................................................      9,870      6,244
Finished goods...................................................................     90,582     67,371
                                                                                    --------    -------
                                                                                    $136,662    $98,270
                                                                                    --------    -------
                                                                                    --------    -------
</TABLE>
 
     If the FIFO method had been used, inventories of the textiles segment would
have  been approximately $3,825,000 and $2,494,000  higher at April 30, 1992 and
April 30, 1993, respectively.
 
(7) INSURANCE OPERATIONS
 
     Chesapeake Insurance (i) provides  certain property insurance coverage  for
Triarc  Companies and  (ii) reinsures  a portion  of certain  insurance coverage
which Triarc Companies and certain former affiliates maintain with  unaffiliated
insurance  companies  (principally  workers'  compensation,  general  liability,
automobile liability  and  group  life). Net  premiums  attributable  to  former
affiliates  were approximately  $8,063,000, $4,400,000 and  $2,875,000 in fiscal
1991, 1992 and 1993,  respectively. In the past,  Chesapeake Insurance had  also
reinsured  insurance risks of  unaffiliated third parties  and former affiliates
through various  group  participations.  Following  the  Reorganization,  Triarc
determined that
 
                                      F-13
 
<PAGE>
                    TRIARC COMPANIES, INC. AND SUBSIDIARIES
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
                                 APRIL 30, 1993
 
Chesapeake  Insurance would no longer insure  or reinsure risks of corporations,
including former affiliates, other than Triarc Companies. As a result, insurance
operations are less significant and are no longer reported as a separate segment
of Triarc Companies' business (see Note 20).
 
     Chesapeake Insurance is registered under the Bermuda Insurance Act of  1978
and  related  regulations  which  require  compliance  with  various  provisions
regarding the  maintenance  of  statutory capital  and  surplus  and  liquidity.
Chesapeake  Insurance  was not  in compliance  with  the required  liquidity and
solvency ratios  as  of  December  31,  1992. However,  as  of  June  30,  1993,
Chesapeake  Insurance  was in  compliance with  the  solvency ratio  although it
remained  in  non-compliance   with  the   liquidity  ratio   by  a   relatively
insignificant  amount. Chesapeake Insurance  subsequently received acceptance of
certain assets for inclusion  in the liquidity ratio  through December 31,  1993
such that Chesapeake Insurance is now in compliance with such ratio.
 
     In September 1989, the Pennsylvania Insurance Commissioner as rehabilitator
of Mutual Fire, Marine and Inland Insurance Company ('Mutual Fire') commenced an
action  in the Commonwealth Court  of Pennsylvania against Chesapeake Insurance.
Such action, among other things, seeks recovery of $4,000,000 allegedly owed  by
Chesapeake  Insurance  in  connection  with  certain  reinsurance  arrangements,
specific performance by  Chesapeake Insurance of  its alleged obligations  under
certain  reinsurance arrangements by requiring Chesapeake Insurance to provide a
letter of credit in an amount in excess of $12,000,000 to secure certain alleged
outstanding losses, a  restitution and accounting  by Chesapeake Insurance,  and
compensatory  and punitive damages in an amount in excess of $40,000,000 arising
out of  alleged bad  faith  in connection  with such  reinsurance  arrangements.
Chesapeake  Insurance  has filed  an answer,  numerous affirmative  defenses and
counterclaims against Mutual  Fire and  is vigorously  contesting Mutual  Fire's
action. Triarc Companies has provided what it believes are adequate reserves and
does  not believe  that the ultimate  resolution of such  matter will materially
adversely affect  the results  of  operations or  financial position  of  Triarc
Companies.
 
     In  June 1993,  Chesapeake Insurance  paid $8,075,000  to a  surety in full
settlement of  an  approximately $13,800,000  liability  due June  30,  1996  in
connection  with the  indemnification by  Chesapeake Insurance  and RC/Arby's of
bonding arrangements on behalf of Pennsylvania Engineering Corporation  ('PEC'),
a former affiliate, for the design and construction of a waste disposal facility
(the  'Dutchess Facility')  in Dutchess County,  New York.  Triarc Companies has
reflected such settlement amount  in accounts payable as  of April 30, 1993,  of
which  $3,000,000  and  $5,075,000  were  provided  in  Fiscal  1992  and  1993,
respectively in 'Selling, general and administrative expenses'.
 
(8) PROPERTIES
 
     The following is a summary of the components of properties, at cost:
 
<TABLE>
<CAPTION>
                                                                                        APRIL 30,
                                                                                   --------------------
                                                                                     1992        1993
                                                                                   --------    --------
                                                                                      (IN THOUSANDS)
<S>                                                                                <C>         <C>
Land............................................................................   $ 25,207    $ 21,903
Buildings and improvements......................................................    100,814      99,151
Machinery and equipment.........................................................    297,940     285,656
Automotive and transportation equipment.........................................     25,061      24,033
                                                                                   --------    --------
                                                                                    449,022     430,743
Less accumulated depreciation...................................................    192,842     192,890
                                                                                   --------    --------
                                                                                   $256,180    $237,853
                                                                                   --------    --------
                                                                                   --------    --------
</TABLE>
 
     Substantially all of the properties used  in the fast food, soft drink  and
textiles  segments, and substantially  all of the  automotive and transportation
equipment used in the liquefied petroleum gas segment (see Note 20), are pledged
as collateral for certain debt (see Note 11).
 
                                      F-14
 
<PAGE>
                    TRIARC COMPANIES, INC. AND SUBSIDIARIES
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
                                 APRIL 30, 1993
 
(9) OTHER CURRENT LIABILITIES
 
     The following is a summary of the components of other current liabilities:
 
<TABLE>
<CAPTION>
                                                                                         APRIL 30,
                                                                                    -------------------
                                                                                     1992        1993
                                                                                    -------    --------
                                                                                      (IN THOUSANDS)
<S>                                                                                 <C>        <C>
Facilities relocation and corporate restructuring (Note 19)......................   $ 1,704    $ 42,000
Salaries and wages...............................................................    14,920      14,902
Other............................................................................    45,376      54,109
                                                                                    -------    --------
                                                                                    $62,000    $111,011
                                                                                    -------    --------
                                                                                    -------    --------
</TABLE>
 
(10) INCOME TAXES
 
     The benefit from  (provision for) income  taxes from continuing  operations
consists of the following components:
 
<TABLE>
<CAPTION>
                                                                             YEAR ENDED APRIL 30,
                                                                        -------------------------------
                                                                          1991       1992        1993
                                                                        --------    -------    --------
                                                                                (IN THOUSANDS)
<S>                                                                     <C>         <C>        <C>
Current:
     Federal.........................................................   $  9,420    $(2,758)   $ (9,994)
     State...........................................................     (2,032)    (2,489)     (3,232)
     Foreign.........................................................       (300)        --        (249)
                                                                        --------    -------    --------
                                                                           7,088     (5,247)    (13,475)
                                                                        --------    -------    --------
Deferred:
     Federal.........................................................      7,905      2,466       3,094
     State...........................................................        561       (175)      1,773
                                                                        --------    -------    --------
                                                                           8,466      2,291       4,867
                                                                        --------    -------    --------
     Total...........................................................   $ 15,554    $(2,956)   $ (8,608)
                                                                        --------    -------    --------
                                                                        --------    -------    --------
</TABLE>
 
     The   current  deferred  tax   asset  and  the   non-current  deferred  tax
(liabilities) consisted of the following components as of April 30, 1993:
 
<TABLE>
<CAPTION>
                                                                                            CURRENT    NON-CURRENT
                                                                                             ASSET      LIABILITY
                                                                                            -------    -----------
                                                                                                (IN THOUSANDS)
<S>                                                                                         <C>        <C>
Facilities relocation and corporate restructuring........................................   $12,508     $  --
Allowance for doubtful accounts including non-affiliates.................................    13,547        --
Employee benefit costs...................................................................     5,207        --
Accelerated depreciation.................................................................     --          (38,448)
Reserve for income tax contingencies and other tax matters...............................     --          (15,192)
Insurance loss reserves..................................................................     --            6,952
Net operating loss and depletion carryforward............................................     --           10,042
Other, net...............................................................................     2,195         5,144
                                                                                            -------    -----------
                                                                                             33,457       (31,502)
Less valuation allowance.................................................................   (12,092)       (4,489)
                                                                                            -------    -----------
                                                                                            $21,365     $ (35,991)
                                                                                            -------    -----------
                                                                                            -------    -----------
</TABLE>
 
                                      F-15
 
<PAGE>
                    TRIARC COMPANIES, INC. AND SUBSIDIARIES
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
                                 APRIL 30, 1993
 
     Deferred income  (taxes)  benefits  result from  temporary  differences  in
recognition of income and expenses for tax and financial statement purposes. The
tax effects of the principal timing differences are as follows:
 
<TABLE>
<CAPTION>
                                                                               YEAR ENDED APRIL 30,
                                                                          ------------------------------
                                                                           1991       1992        1993
                                                                          -------    -------    --------
                                                                                  (IN THOUSANDS)
<S>                                                                       <C>        <C>        <C>
Provision for interest on income tax contingencies and other tax
  matters..............................................................   $ --       $ --       $  3,025
Insurance loss reserves................................................       705        872        (675)
Facilities relocation and corporate restructuring......................     1,437       (917)     12,508
Provision for income tax deficiencies and other tax matters............     --         --        (11,767)
Excess of (tax over book) book over tax depreciation, depletion and
  amortization of properties...........................................    (1,935)      (530)      2,921
Alternative minimum (tax) credit.......................................     2,376        976      (2,684)
Carryforward recognized as a reduction of deferred credits.............     --         3,358       --
Expenses not deductible until paid.....................................     2,032        527       1,503
Tax on dividends from subsidiaries not included in consolidated
  return...............................................................      (416)    (1,104)       (334)
Amortization of debt discount..........................................       259        335         317
Benefit from unrealized losses on marketable securities................       498        960         130
Employee benefit plan payment..........................................     3,064     (3,064)      --
Pension benefit recognized for tax purposes............................     --           530       --
Other, net.............................................................       446        348         (77)
                                                                          -------    -------    --------
                                                                          $ 8,466    $ 2,291    $  4,867
                                                                          -------    -------    --------
                                                                          -------    -------    --------
</TABLE>
 
                                      F-16
 
<PAGE>
                    TRIARC COMPANIES, INC. AND SUBSIDIARIES
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
                                 APRIL 30, 1993
 
     The  difference between the  reported income tax  benefit (provision) and a
computed tax  benefit based  on loss  from continuing  operations before  income
taxes at the 34% statutory rate is reconciled as follows:
 
<TABLE>
<CAPTION>
                                                                          YEAR ENDED APRIL 30,
                                                                   -----------------------------------
                                                                     1991         1992          1993
                                                                   --------      -------      --------
                                                                             (IN THOUSANDS)
<S>                                                                <C>           <C>          <C>
Loss from continuing operations before income taxes.............   $ 33,681      $ 6,738      $ 39,291
Federal income tax rate.........................................         34%          34%           34%
                                                                   --------      -------      --------
Computed expected benefit.......................................     11,452        2,291        13,359
Decrease (increase) in Federal taxes resulting from:
     Provision for income tax contingencies and other tax
       matters..................................................      --           --          (11,767)
     Amortization of nontaxable debits resulting from purchase
       accounting adjustments...................................       (408)        (531)       (2,986)
     Effect of net operating losses for which no tax carryback
       benefit is available.....................................     (3,021)      (1,977)       (2,533)
     Consulting agreement with Steven Posner (Note 19)..........      --           --           (2,040)
     Tax on dividends from subsidiaries not included in
       consolidated returns.....................................       (416)      (1,104)       (1,397)
     State taxes, net of Federal income tax benefit.............       (971)      (1,758)         (963)
     Foreign taxes..............................................       (300)       --             (249)
     Defined benefit pension plan settlement previously accrued
       in purchase accounting without tax benefit...............      8,429        --            --
     Other, net.................................................        789          123           (32)
                                                                   --------      -------      --------
                                                                   $ 15,554      $(2,956)     $ (8,608)
                                                                   --------      -------      --------
                                                                   --------      -------      --------
</TABLE>
 
     Federal  income  tax  returns  of Triarc  and  its  subsidiaries  are being
examined by the Internal Revenue Service ('IRS') for the tax years 1985  through
1988.  In late Fiscal  1993, the IRS  issued notices of  proposed adjustments to
taxable income totaling approximately $98,000,000, that would be reduced by  net
operating  loss carryforwards of approximately $20,000,000 which otherwise would
have expired.  Triarc  Companies is  contesting  a significant  portion  of  the
proposed  adjustments and  in July  1993 responded to  such notices.  The IRS is
presently reviewing such responses and no  final report has been issued.  Triarc
Companies  understands  the IRS  will commence  the  examination of  its Federal
income tax returns for the tax years  from 1989 through 1992 in the latter  part
of  the 1993  calendar year. During  Fiscal 1993, Triarc  Companies has provided
estimated charges in the  amount of approximately  $11,767,000 to provision  for
income  taxes  from continuing  operations  and $8,547,000  to  interest expense
relating to  such examinations  and other  tax matters,  of which  approximately
$7,897,000  and $6,109,000, respectively,  were recorded in  the fourth quarter.
Management of Triarc Companies believes that adequate aggregate provisions  have
been  made in  the current  and prior years  for any  tax liabilities, including
interest, that may result from such examinations and other tax matters.
 
     Triarc  Companies  recorded  an   extraordinary  credit  relating  to   the
utilization of net operating loss carryforwards of $703,000 in Fiscal 1991.
 
                                      F-17
 
<PAGE>
                    TRIARC COMPANIES, INC. AND SUBSIDIARIES
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
                                 APRIL 30, 1993
 
(11) LONG-TERM DEBT
 
     Long-term debt consists of the following:
 
<TABLE>
<CAPTION>
                                                                                        APRIL 30,
                                                                                   --------------------
                                                                                     1992        1993
                                                                                   --------    --------
                                                                                      (IN THOUSANDS)
<S>                                                                                <C>         <C>
CFC Holdings and subsidiaries:
     Step-Up Notes, 9 1/2% increasing to 11 1/4% expensed at a constant rate to
       maturity, refinanced August 12, 1993(a)..................................   $  --       $225,000
     AFC Exchange Agreement, paid in April 1993 (a).............................    103,352       --
     Notes payable to banks, prime plus 8%, paid in July 1992...................     20,000       --
     16 1/4% senior subordinated debentures paid in July 1993...................      1,168         968
     16 7/8% subordinated debentures due 1996(b)................................     18,092      15,470
     Capitalized lease obligations..............................................     12,626      11,565
     Other notes payable with interest ranging from 9% to 12.5% secured by
       equipment................................................................      6,112       5,237
                                                                                   --------    --------
                                                                                    161,350     258,240
                                                                                   --------    --------
Graniteville and subsidiaries:
     Graniteville Credit Facility, prime or LIBOR plus from 1.25% to 3.5%, due
       through April 1998 (c):
          Term loan.............................................................      --         80,000
          Revolving loan........................................................      --         72,734
     Term loan, prime plus 1 1/2%, paid in April 1993(c)........................     46,875       --
     6 1/2% Washington National Insurance Company Pollution Control note due
       through 1999.............................................................      1,060         946
     Notes collateralized by machinery and equipment maturing at various dates
       through 1994 with interest at various fixed and floating rates (weighted
       average interest rate of 8.5% and 8.2%)..................................      2,848         982
     Capitalized lease obligations..............................................        748         330
                                                                                   --------    --------
                                                                                     51,531     154,992
                                                                                   --------    --------
National Propane and subsidiaries:
     13 1/8% senior subordinated debentures due March 1, 1999 (less unamortized
       deferred discount of $4,654,000 and $3,815,000)(d).......................     58,346      52,185
     AFC loan, 11 3/4%, paid in April 1993(g)...................................     30,000       --
     11 3/4% secured note payable to AFC, paid in April 1993(g).................      4,958       --
     Equipment notes, 1% to 2% over prime due through 1998(e)...................     34,394      32,570
     Other......................................................................      2,214       1,696
                                                                                   --------    --------
                                                                                    129,912      86,451
     Portion of equipment notes relating to equipment of discontinued
       operations(e)............................................................    (28,883)    (26,198)
                                                                                   --------    --------
                                                                                    101,029      60,253
                                                                                   --------    --------
SEPSCO and subsidiaries:
     11 7/8% senior subordinated debentures due February 1, 1998 (less
       unamortized deferred discount of $6,666,000 and $5,282,000)(f)...........     65,334      57,718
     10% to 13% mortgage and equipment notes due 1994 to 2003...................        147         546
     Other......................................................................      --              5
                                                                                   --------    --------
                                                                                     65,481      58,269
                                                                                   --------    --------
Triarc:
     AFC loan, 11 3/4%, paid in April 1993 (less unamortized deferred discount
       of $1,193,000 in 1992)(g)................................................     19,647       --
     5 1/2% convertible subordinated debentures retired January 1993............        106       --
                                                                                   --------    --------
                                                                                     19,753       --
                                                                                   --------    --------
     Other......................................................................        463       --
                                                                                   --------    --------
               Total debt.......................................................    399,607     531,754
     Less amounts payable within one year.......................................    109,849      43,100
                                                                                   --------    --------
                                                                                   $289,758    $488,654
                                                                                   --------    --------
                                                                                   --------    --------
</TABLE>
 
                                      F-18
 
<PAGE>
                    TRIARC COMPANIES, INC. AND SUBSIDIARIES
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
                                 APRIL 30, 1993
 
     Aggregate  annual maturities of long-term  debt, including required sinking
fund payments,  capitalized  lease  obligations  and  reflecting  the  scheduled
maturities  of equipment  notes without  regard to  any acceleration  that would
result from the sale of certain of SEPSCO's businesses as discussed in note  (e)
below, are as follows:
 
<TABLE>
<CAPTION>
                             YEAR ENDED APRIL 30,                                (IN THOUSANDS)
- ------------------------------------------------------------------------------   --------------
<S>                                                                              <C>
1994..........................................................................      $ 43,100
1995..........................................................................        39,885
1996..........................................................................        31,084
1997..........................................................................        29,878
1998..........................................................................       142,430
Thereafter....................................................................       254,474
                                                                                 --------------
                                                                                     540,851
Less unamortized deferred discount............................................         9,097
                                                                                 --------------
                                                                                    $531,754
                                                                                 --------------
                                                                                 --------------
</TABLE>
 
     (a)  In April  1993, the  AFC Exchange Agreement  debt was  repaid from the
proceeds of the issuance  of $225,000,000 of senior  secured step-up rate  notes
due  2000  (the 'Step-Up  Notes'). On  August  12, 1993  the Step-Up  Notes were
refinanced by the  issuance of $275,000,000  of fixed rate  senior secured  debt
securities  pursuant to a public offering (the '9 3/4%Senior Notes'). The 9 3/4%
Senior Notes bear interest at 9 3/4% and will mature in 2000. The 9 3/4%  Senior
Notes  are secured by all of the assets  of RC/Arby's including all of the stock
of RC/Arby's' subsidiaries, Royal Crown Company, Inc. ('RC Cola', formerly known
as Royal Crown  Cola Co., Inc.)  and Arby's, Inc.  ('Arby's'). In addition,  CFC
Holdings  pledged all the stock of RC/Arby's as collateral for the 9 3/4% Senior
Notes, and amounts due thereunder are unconditionally guaranteed by RC Cola  and
Arby's.  The guaranties of  RC Cola and  Arby's are secured  by a first priority
lien  and  security  interest  in   substantially  all  of  their   receivables,
inventories and properties. The 9 3/4% Senior Notes are redeemable at the option
of  RC/Arby's at amounts  commencing at 102.786%  of principal commencing August
1998 decreasing  to  101.393% in  August  1999. In  addition,  should  RC/Arby's
consummate  an  initial  public  equity  offering  RC/Arby's  may  redeem  up to
$91,667,000 of  the 9  3/4%  Senior Notes  at 110%  of  principal with  the  net
proceeds of such public offering.
 
     RC/Arby's  incurred  approximately  $14,700,000  of  fees  and  expenses in
connection with the issuance of  the 9 3/4% Senior  Notes which are recorded  as
deferred   financing  costs.  Further,  during  1993,  RC/Arby's  recognized  an
extraordinary charge of $6,611,000 in  connection with the early  extinguishment
of  debt, representing the write-off of  unamortized deferred financing costs of
$3,741,000  and  the  payment  of  prepayment  penalties  of  $6,651,000,   less
$3,781,000 of income tax benefit. In addition, $3,200,000 of commitment fees for
another   proposed  financing  with  a  syndicate  of  banks,  which  was  never
consummated because  of  the issuance  of  the  Step-Up Notes,  was  charged  to
operations  during 1993.  Such alternative financing  was abandoned  due to more
favorable payment terms and covenants associated with the Step-Up Notes.
 
     (b) The 16 7/8% subordinated debentures due 1996 (the '16 7/8% Debentures')
require mandatory  sinking  fund  payments  which  as  of  April  30,  1993  are
$9,000,000 in July 1993 and $6,470,000 in July 1994.
 
     (c)  In connection with the Reorganization,  on April 23, 1993 Graniteville
and its subsidiary, C. H. Patrick & Co., Inc., ('C. H. Patrick') entered into  a
$180,000,000 senior secured credit facility (the 'Graniteville Credit Facility')
with  Graniteville's  commercial  lender and  repaid  its prior  term  loan. The
Graniteville Credit  Facility  consists of  a  senior secured  revolving  credit
facility of up to $100,000,000 (the 'Revolving Loan') with a $5,000,000 sublimit
for  letters of credit  and an $80,000,000  senior secured term  loan (the 'Term
Loan') and  expires  in 1998.  As  part  of the  Graniteville  Credit  Facility,
 
                                      F-19
 
<PAGE>
                    TRIARC COMPANIES, INC. AND SUBSIDIARIES
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
                                 APRIL 30, 1993
 
Graniteville's  commercial lender will continue  to factor Graniteville's and C.
H. Patrick's sales,  with credit  balances assigned to  secure the  Graniteville
Credit   Facility   (the   'Factoring   Arrangement').   Graniteville   incurred
approximately  $6,500,000  of   fees  and  expenses   in  connection  with   the
Graniteville Credit Facility which are recorded as deferred financing costs.
 
     Borrowings  under  the  Revolving  Loan  bear  interest,  at Graniteville's
option, at either  the prime  rate plus  1.25% per  annum or  the 90-day  London
Interbank  Offered Rate (the 'LIBOR  rate') plus 3.00% per  annum. If the unpaid
principal balance of the Term Loan  is less than $55,000,000, the interest  rate
on the Revolving Loan will be reduced to the prime rate plus 1.00% or the 90-day
LIBOR  rate plus 2.75%. All LIBOR rate  loans will have a 90-day interest period
and will be limited  to $90,000,000 in total  borrowings under the  Graniteville
Credit  Facility. The borrowing base  for the Revolving Loan  will be the sum of
90% of  accounts receivable  which are  credit-approved by  the factor  ('Credit
Approved Receivables'), plus 85% of all other eligible accounts receivable, plus
65%  of eligible  inventory, provided  that advances  against eligible inventory
shall not exceed $35,000,000 at any  one time. Graniteville, in addition to  the
aforementioned  interest,  pays a  commission  of 0.45%  on  all Credit-Approved
Receivables, including a 0.20% bad debt reserve which will be shared equally  by
Graniteville's  commercial  lender  and  Graniteville  after  deducting customer
credit losses.
 
     The  Term  Loan  is  repayable  $10,000,000  during  the  first  year   and
$12,000,000  per year  thereafter, with  a final  payment of  $22,000,000 due in
April 1998. Until the unpaid principal of the Term Loan is equal to or less than
$60,000,000 at the  end of  any fiscal  year, Graniteville  must make  mandatory
prepayments  in an amount equal to 50% of Excess Cash Flow, as defined, for such
fiscal year. The Term Loan bears interest at the prime rate plus 1.75% per annum
or the 90-day LIBOR rate plus 3.5% per annum. When the unpaid principal  balance
of  the Term Loan  is less than  $55,000,000, the interest  rate thereon will be
reduced to the prime rate plus 1.375%  or the 90-day LIBOR rate plus 3.125%.  In
each  case, the LIBOR rate  is limited to $90,000,000  in total borrowings under
the Graniteville Credit  Facility. In  the event that  Graniteville prepays  the
Term  Loan, in  whole or in  part, prior to  the end  of the third  year, then a
prepayment fee shall  be payable as  follows: 2%  of the amount  prepaid if  the
prepayment occurs in the first year, 1% of the prepayment during the second year
and 1/2 of 1% in the third year.
 
     The  Graniteville  Credit  Facility is  secured  by  all of  the  assets of
Graniteville and  C.  H.  Patrick,  including  all  accounts  receivable,  notes
(including  the  $66,600,000  note  Graniteville  received  from  Triarc  as  an
intercompany advance), inventory, machinery  and equipment, trademarks,  patents
and  other intangible assets, and all real estate. Graniteville has also pledged
as collateral the stock of C. H. Patrick. Additionally, Triarc and  Graniteville
International  Sales, Inc.,  Graniteville's only  other wholly-owned subsidiary,
have unconditionally guaranteed  all obligations under  the Graniteville  Credit
Facility. As collateral for such guarantee, Triarc pledged (i) 51% of the issued
and  outstanding stock of  Graniteville (subject to  pre-existing pledge of such
stock in connection  with a Triarc  intercompany note payable  to SEPSCO in  the
principal  amount of  $26,538,000), and (ii)  the issued  and outstanding common
stock of SEPSCO owned by Triarc.
 
     (d) National Propane  is required  to retire annually  through a  mandatory
sinking  fund, $7,000,000  principal amount of  its 13  1/8% senior subordinated
debentures (the  '13 1/8%  Debentures') through  1998 with  a final  payment  of
$21,000,000 due in 1999.
 
     (e)   The  equipment  notes   were  issued  by   NPC  Leasing  Corp.  ('NPC
Leasing' -- a wholly-owned  subsidiary of National Propane)  and are secured  by
vehicles  and other  equipment under lease  to Triarc Companies,  and in certain
cases are guaranteed by Triarc and/or National Propane. The notes bear  interest
at  rates which range from 1% to 2% above the prime rate and are payable in both
equal monthly and quarterly installments over varying terms of up to 60  months.
Approximately  $26,198,000 of  such notes  as of April  30, 1993  are secured by
equipment utilized in the discontinued operations  described in Note 3 and  upon
the sale of such operations, notes will be repaid prior to maturity.
 
                                      F-20
 
<PAGE>
                    TRIARC COMPANIES, INC. AND SUBSIDIARIES
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
                                 APRIL 30, 1993
 
     (f)  SEPSCO is  required to  retire annually,  through a  mandatory sinking
fund, $9,000,000 principal amount of its 11 7/8% senior subordinated  debentures
(the  '11 7/8% Debentures') through 1997 with a final payment of $27,000,000 due
in 1998.
 
     (g) In connection  with the  Reorganization, Triarc  Companies also  repaid
National Propane's and Triarc's loans from subsidiaries of AFC.
 
     Triarc  Companies'  debt  agreements contain  various  covenants  which (a)
require meeting certain financial amount and ratio tests; (b) limit, among other
items, (i) the  incurrence of indebtedness,  (ii) the retirement  of other  debt
prior  to  maturity, (iii)  investments,  (iv) asset  dispositions,  (v) capital
expenditures and (vi) affiliate transactions other than in the normal course  of
business;  and  (c)  restrict the  payment  of dividends  by  Triarc's principal
subsidiaries to Triarc. As  of April 30, 1993  National Propane and SEPSCO  have
$16,339,000  and $7,300,000, respectively (71.1%  or approximately $5,190,000 in
the case of  SEPSCO would  inure to  the benefit  of Triarc)  available for  the
payment of dividends to Triarc. Graniteville is unable to pay any such dividends
prior  to February 28, 1996.  While there are no  restrictions applicable to CFC
Holdings, RC/Arby's had $1,000,000 available for the payment of dividends to CFC
Holdings following the issuance of RC/Arby's' 9 3/4%Senior Notes.
 
     Sinking fund requirements on the 13 1/8% Debentures and 11 7/8%  Debentures
were  satisfied during 1991, 1992  and 1993, as applicable,  by a combination of
cash payments and surrender of such debentures acquired from either a subsidiary
of AFC or in the open market. The discount on the 13 1/8% Debentures and 11 7/8%
Debentures purchased in  the open market  aggregated $3,510,000, $4,650,000  and
$117,000 in Fiscal 1991, 1992 and 1993, respectively.
 
     The  carrying value of  long-term debt which  was issued on  April 23, 1993
(consisting  of  the  Graniteville  Credit  Facility  and  the  Step-Up   Notes)
approximates  fair value due to the recent issuance of such indebtedness. Except
for the two issues noted below, the carrying value of other long-term debt  also
approximates  fair value based on current market rates for similar securities or
redemption prices subsequent to  year-end. At April 30,  1993 the fair value  of
the  13 1/8% Debentures was approximately  $4,700,000 higher than their carrying
value of $52,185,000. The fair value of the 11 7/8% Debentures was approximately
$5,400,000 higher than  their carrying  value of  $57,718,000. Such  debentures'
fair value is represented by quoted market prices at April 30, 1993.
 
(12) REDEEMABLE PREFERRED STOCK
 
     The redeemable preferred stock has a stated and liquidation value of $12.00
per share and bears a cumulative annual dividend of 8 1/8% payable semi-annually
is mandatorily redeemable on April 23, 2005 at $12.00 per share plus accrued but
unpaid  dividends and is redeemable at the  option of Triarc commencing on April
23, 1998 at prices commencing at $12.84 in 1998 and decrease annually thereafter
by $0.12 to $12.00 in 2005 (the 'Redeemable Convertible Preferred Stock').
 
     If at any time during the period from April 23, 1996 to April 23, 1998, the
closing price per share of  Triarc Class A Common Stock  is at least $18.50  per
share,  subject to  customary anti-dilution adjustments,  for at least  20 of 30
consecutive  trading  days,  Triarc  can  within  30  days  thereafter   require
conversion  of all but not less than all of the Redeemable Convertible Preferred
Stock into Class A or Class B (see  Note 13) Common Stock at a conversion  price
of  $14.40 per share. If such conversion  is required by Triarc, then, within 30
days after such  conversion, the  holders of such  Common Stock  into which  the
Redeemable   Convertible  Preferred   Shares  were  converted   shall  have  the
unconditional right to  require Triarc to  purchase all or  part of such  common
stock  at $21.00 per  share. The Redeemable Convertible  Preferred Stock will be
convertible, in whole or in part, by the holder thereof at any time into  shares
of  Triarc's Class B common stock par value  $.10 per share (the 'Triarc Class B
Common Stock') at a conversion price of $14.40 per share or a total of 4,985,722
shares (the 'Conversion Shares'), which under certain circumstances, will become
convertible into  the same  number of  shares of  Triarc Class  A Common  Stock.
Triarc  has  reserved  4,985,722  shares  of  Triarc  Class  B  Common  Stock in
 
                                      F-21
 
<PAGE>
                    TRIARC COMPANIES, INC. AND SUBSIDIARIES
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
                                 APRIL 30, 1993
 
accordance herewith.  Under certain  circumstances, the  Redeemable  Convertible
Preferred  Stock will become convertible directly  into shares of Triarc Class A
Common Stock at a conversion price of  $14.40 per share. All of such  conversion
and redemption prices are subject to anti-dilution adjustments.
 
(13) STOCKHOLDERS' EQUITY
 
     Triarc  has 75,000,000 authorized shares of Triarc Class A Common Stock and
12,000,000 authorized shares  of Triarc  Class B Common  Stock as  of April  30,
1993.  The Triarc Class B Common Stock is identical to the Triarc Class A Common
Stock, except that Triarc Class A Common Stock has one vote per share and Triarc
Class B Common Stock is non-voting.  Under certain circumstances, each share  of
Triarc  Class B  Common Stock is  convertible into  one share of  Triarc Class A
Common Stock. None of the Triarc Class B Common Stock has been issued. A summary
of the changes  in the Triarc  Class A Common  Stock for the  three years  ended
April 30, 1993 is as follows:
 
<TABLE>
<CAPTION>
                                                                               1991      1992      1993
                                                                              ------    ------    ------
                                                                                    (IN THOUSANDS)
<S>                                                                           <C>       <C>       <C>
Number of shares at beginning of year......................................   26,968    26,973    27,006
Common stock issued:
     Equity Financing (Note 2).............................................     --        --         833
     Grant of restricted shares (Note 14)..................................     --        --         268
     Conversion of preferred stock.........................................        1         2       129
     Conversion of debentures..............................................        4        31        15
                                                                              ------    ------    ------
Number of shares at end of year............................................   26,973    27,006    28,251
                                                                              ------    ------    ------
                                                                              ------    ------    ------
</TABLE>
 
     Triarc  has 7,000,000 authorized shares of  preferred stock as of April 30,
1993, excluding the 6,000,000 shares of Redeemable Convertible Preferred  Stock.
Such  preferred stock  has been designated  as Serial Preferred  Stock, $.10 par
value (5,000,000  shares) and  Junior  Serial Preferred  Stock, $.10  par  value
(2,000,000  shares). No Serial Preferred Stock  or Junior Serial Preferred Stock
has been issued. Prior to April 1993,  Triarc had $.60 preferred stock and  $.35
preferred  stock which  were convertible into  7.789 and 4.439  shares of Triarc
Class A  Common Stock,  respectively, and  were redeemable  at their  respective
redemption prices of $20.00 and $5.50 per share. For the three years ended April
30, 1993, aggregate activity of issued preferred stock is summarized as follows:
 
<TABLE>
<CAPTION>
                                                                               1991      1992      1993
                                                                              ------    ------    ------
                                                                                    (IN THOUSANDS)
<S>                                                                           <C>       <C>       <C>
Number of shares at beginning of year......................................      31        31        30
Conversions into common stock..............................................    --          (1)      (28)
Redemptions................................................................    --        --          (2)
                                                                              ------    ------    ------
Number of shares at end of year............................................      31        30      --
                                                                              ------    ------    ------
                                                                              ------    ------    ------
</TABLE>
 
'Other  stockholders' equity (deficit)' consisted of  the following at April 30,
1992 and 1993, respectively.
 
<TABLE>
<CAPTION>
                                                                                         1992     1993
                                                                                         ----    -------
                                                                                         (IN THOUSANDS)
<S>                                                                                      <C>     <C>
Unearned compensation (Note 14).......................................................   $--     $(4,824)
Net unrealized gains on marketable securities of insurance operations, net of minority
  interests...........................................................................    177        416
                                                                                         ----    -------
                                                                                         $177    $(4,408)
                                                                                         ----    -------
                                                                                         ----    -------
</TABLE>
 
                                      F-22
 
<PAGE>
                    TRIARC COMPANIES, INC. AND SUBSIDIARIES
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
                                 APRIL 30, 1993
 
(14) PENSION AND INCENTIVE COMPENSATION PLANS
 
     Triarc Companies provides or provided  defined benefit plans for  employees
of  certain  subsidiaries.  In  fiscal  1989, all  but  one  of  the  plans were
temporarily frozen pending review by management with respect to required changes
necessary to  comply with  the nondiscrimination  rules promulgated  by the  Tax
Reform  Act of 1986 and subsequent legislation. During 1991 the Internal Revenue
Service issued final regulations regarding such non-discrimination rules and  as
a  result of  the unfavorable  consequences of  such regulations,  management of
Triarc Companies decided in  calendar 1992 to freeze  the plans permanently  and
terminate  certain  of  the  plans. In  accordance  therewith,  Triarc Companies
recognized curtailment gains  of $1,182,000  and $2,562,000 in  Fiscal 1992  and
1993, respectively, and a termination gain of $431,000 in fiscal 1993.
 
     The net periodic pension cost (benefit) of the plans in 1991, 1992 and 1993
was $1,177,000, $(426,000) and $154,000, respectively. The components of the net
periodic pension cost (benefit) are as follows:
 
<TABLE>
<CAPTION>
                                                                              1991       1992      1993
                                                                             -------    -------    -----
                                                                                   (IN THOUSANDS)
<S>                                                                          <C>        <C>        <C>
Current service cost......................................................   $ 1,487    $   389    $ 281
Interest cost on projected benefit obligation.............................     1,988      1,419      568
Return on plan assets.....................................................    (2,120)    (2,255)    (908)
Net amortization and deferrals............................................      (178)        21      213
                                                                             -------    -------    -----
     Net periodic pension cost (benefit)..................................   $ 1,177    $  (426)   $ 154
                                                                             -------    -------    -----
                                                                             -------    -------    -----
</TABLE>
 
     The  following table sets  forth the plans'  funded status as  of April 30,
1992 and 1993:
 
<TABLE>
<CAPTION>
                                                                       AGGREGATE OF PLANS WHOSE
                                                               -----------------------------------------
                                                                  ASSETS EXCEED          ACCUMULATED
                                                                   ACCUMULATED             BENEFITS
                                                                    BENEFITS            EXCEED ASSETS
                                                               -------------------    ------------------
                                                                 1992       1993       1992       1993
                                                               --------    -------    -------    -------
                                                                            (IN THOUSANDS)
<S>                                                            <C>         <C>        <C>        <C>
Actuarial present value of benefit obligations:
     Vested benefit obligation..............................   $ (9,855)   $(4,077)   $(3,917)   $(4,056)
     Non-vested benefit obligation..........................       (156)       (22)     --           (68)
                                                               --------    -------    -------    -------
     Accumulated and projected benefit obligation...........    (10,011)    (4,099)    (3,917)    (4,124)
Plan assets at fair value...................................     11,641      4,502      1,887      3,538
                                                               --------    -------    -------    -------
Reconciliation of funded status:
     Projected benefit obligation less than (in excess of)
       plan assets..........................................      1,630        403     (2,030)      (586)
     Unrecognized prior service costs.......................         18         17        127      --
     Unrecognized net gain from plan experience.............     (1,961)      (163)       (90)       (60)
     Unamortized net (asset) obligation at transition.......        747       (182)       704      --
                                                               --------    -------    -------    -------
          Prepaid (accrued) pension cost....................   $    434    $    75    $(1,289)   $  (646)
                                                               --------    -------    -------    -------
                                                               --------    -------    -------    -------
</TABLE>
 
     Significant assumptions  used in  measuring pension  costs for  the  Fiscal
years 1991, 1992 and 1993 for the plans included a 9% expected long-term rate of
return  on assets and amortization of gains  and losses, plan amendments and the
transition asset or liability primarily over the average remaining service lives
of participants expected to  receive benefits. The discount  rate was 9% and  7%
(for plans terminated by 1992) for the 1991 and 1992 fiscal years and 8% for the
1993  Fiscal  year.  The  effect  of the  reduction  in  the  discount  rate for
continuing plans was to increase the 1993 net pension expense by $47,000.
 
                                      F-23
 
<PAGE>
                    TRIARC COMPANIES, INC. AND SUBSIDIARIES
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
                                 APRIL 30, 1993
 
     Plan assets  are invested  in managed  portfolios consisting  primarily  of
money  market investments,  corporate bonds,  government obligations  and common
stock of unaffiliated issuers.
 
     Under certain  union  contracts,  Triarc  Companies  is  required  to  make
payments  to the unions' pension  funds based upon hours  worked by the eligible
employees. Payments to the funds amounted  to $1,464,000 in 1991, $1,359,000  in
1992  and $1,290,000 in 1993. Information  from the plans' administrators is not
available to permit  Triarc Companies  to determine its  proportionate share  of
unfunded vested benefits, if any.
 
     Triarc  Companies maintains  unfunded medical  and death  benefit plans for
certain retired  employees  who have  reached  certain ages  and  have  provided
certain minimum years of service. The medical benefits are contributory for some
employees   and   noncontributory   for  others,   while   death   benefits  are
noncontributory. Effective May 1,  1992 Triarc Companies  adopted SFAS 106  and,
accordingly, provided as 'Cumulative effect of changes in accounting principles,
net' the unfunded accumulated postretirement benefit obligation as of that date.
Prior  to such  date, Triarc  Companies accounted  for postretirement obligation
payments on a pay-as-you-go  basis; in Fiscal 1991  and 1992 such payments  were
immaterial.
 
     Net  other postretirement benefit expense for  Fiscal 1993 consisted of the
following:
 
<TABLE>
<CAPTION>
                                                                       (IN THOUSANDS)
<S>                                                                    <C>
Service cost -- benefit earned during the period....................        $ 43
Interest cost on accumulated postretirement benefit obligation......         219
                                                                          ------
                                                                            $262
                                                                          ------
                                                                          ------
</TABLE>
 
     The accumulated other  postretirement benefit  obligation as  of April  30,
1993 (which is equal to the amount which has been recognized in the accompanying
consolidated balance sheet) consists of the following:
 
<TABLE>
<CAPTION>
                                                                       (IN THOUSANDS)
<S>                                                                    <C>
Retirees and dependents.............................................       $2,493
Active employees eligible to retire.................................           88
Active employees not eligible to retire.............................          305
                                                                          -------
                                                                           $2,886
                                                                          -------
                                                                          -------
</TABLE>
 
     For  measurement purposes, a 12% annual rate  of increase in the per capita
cost of covered health care benefits was  assumed for Fiscal 1993. The rate  was
assumed  to decrease one  percentage point to  11% for the  following period and
continue to decrease one percentage point annually to 6% for 1998 and remain  at
that  level  thereafter. The  assumed health  care cost  trend rate  affects the
amounts reported. To illustrate, increasing such rate by one percentage point in
each year would increase the accumulated other postretirement benefit obligation
as of April 30, 1993 by approximately $246,000 and the aggregate of the  service
and interest cost components of the net other postretirement benefit expense for
Fiscal 1993 by approximately $30,000. An 8% discount rate was assumed.
 
     Triarc  Companies maintains 401(k) defined contribution plans for employees
who elect to participate. Employees may contribute from 1% to 15% of their total
earnings, subject  to certain  limitations. Triarc  Companies makes  a  matching
contribution  of 25% of the employee's contributions but limited to the first 5%
of an employee's compensation and an  additional contribution equal to 0.25%  of
such  employee's total earnings. Contributions made  by Triarc Companies to such
plans were $590,000, $562,000 and $707,000 in 1991, 1992 and 1993, respectively.
 
     Triarc's Board  of Directors  has  approved an  amended and  restated  1993
equity  participation plan (the 'Equity Participation Plan') under which certain
directors, officers and  key employees  and consultants  are granted  restricted
stock   and  stock   options  subject   to  stockholder   approval.  The  Equity
 
                                      F-24
 
<PAGE>
                    TRIARC COMPANIES, INC. AND SUBSIDIARIES
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
                                 APRIL 30, 1993
 
Plan provides for a maximum of 3,500,000  shares of Triarc Class A Common  Stock
to be granted as restricted stock or issued on the exercise of options. Grantees
of  restricted stock are  entitled to receive dividends  and have voting rights,
but do not receive full beneficial  ownership until the required vesting  period
has  been completed and until certain other requirements, if any, have been met.
On April 24,  1993, 268,000 shares  of restricted stock  were granted. The  fair
market  value of Triarc Class A Common  Stock on the first trading day following
the grant was $18.00 per share and total unearned compensation of $4,824,000 has
been recorded and will be amortized to compensation expense over the  applicable
vesting  period.  Compensation expense  related thereto  was not  significant in
fiscal 1993. Also, on April 24, 1993, 1,712,500 non-qualified stock options were
granted at  an  option  price  of $18.00.  One-third  of  these  options  become
exercisable in the fourth, fifth and sixth year following the date of grant.
 
     On  July 22, 1993 an aggregate of 150,000 shares of restricted Triarc Class
A Common Stock was granted to certain  of the members of a special committee  of
Triarc's  Board of  Directors (the 'Triarc  Special Committee' --  see below and
Note 19 for further discussion) in compensation for future services and pursuant
to the Equity Participation Plan. The fair market value of Triarc Class A Common
Stock on the day following the grant of $22.00 per share will be recorded in the
first quarter  following  Fiscal  1993  as unearned  compensation  and  will  be
amortized to compensation expense over the applicable vesting period.
 
     Triarc  Companies  maintained  management incentive  plans  (the 'Incentive
Plans') which provided  for incentive  compensation of  up to  10% of  operating
earnings  and up to 10% of earnings  from sales or other dispositions of assets.
Awards were  entirely  discretionary  and  required approval  of  the  Board  of
Directors. Additionally, awards to Victor and Steven Posner required approval by
the Triarc Special Committee of Triarc's Board of Directors formed in connection
with  a  stipulation  of  settlement  of  shareholder  litigation  (the 'Granada
Litigation') entered  into in  1990  in connection  with  an action  brought  by
Granada  Investments, Inc. against Triarc and  its directors. In accordance with
the  Incentive  Plans  Triarc  Companies  provided  $3,044,000,  $5,207,000  and
$6,668,000  in 1991, 1992  and 1993, respectively,  and reversed $10,000,000 and
$7,297,000 in 1992 and 1993, respectively. Thus, the net provisions  (reversals)
amounted  to $3,044,000, $(4,793,000)  and $(629,000), for  1991, 1992 and 1993,
respectively. No payments  were made under  the Incentive Plans  because of  the
Triarc  Special Committee's refusal  to approve any awards  to Victor and Steven
Posner. Nevertheless, Triarc Companies continued  to make provisions because  if
the  Granada Litigation had been  resolved favorably to Victor  Posner or if the
term of the  Triarc Special Committee  had expired during  the period of  Victor
Posner's  control of  Triarc Companies, it  was likely  that all or  some of the
incentive compensation would have been paid. The reversal at the end of 1992 was
made on the recommendation  of the Triarc Special  Committee. In April 1993,  in
connection  with the  change in control  of Triarc Companies,  Victor Posner and
Steven Posner resigned  as officers and  directors of Triarc  Companies and  its
affiliates  and the new management of  Triarc Companies terminated the Incentive
Plans. Accordingly, Triarc  Companies reversed  $7,297,000 of  such accruals  in
1993.  At  April  30,  1992  and  1993  there  were  $6,318,000  and $5,689,000,
respectively, available under the Incentive Plan including $4,689,000 paid under
the  Incentive  Plan  subsequent  to  the  Fiscal  1993  year-ends  of   certain
subsidiaries of Triarc; such amounts are included in 'Other current liabilities'
in the accompanying consolidated balance sheets.
 
                                      F-25
 
<PAGE>
                    TRIARC COMPANIES, INC. AND SUBSIDIARIES
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
                                 APRIL 30, 1993
 
(15) OTHER INCOME (EXPENSE), NET
 
     Other income (expense), net consists of the following components:
 
<TABLE>
<CAPTION>
                                                                               YEAR ENDED APRIL 30,
                                                                           -----------------------------
                                                                            1991       1992       1993
                                                                           -------    -------    -------
                                                                                  (IN THOUSANDS)
<S>                                                                        <C>        <C>        <C>
Interest income.........................................................   $ 6,838    $ 3,543    $ 1,716
Gains on repurchases of debentures for sinking funds (Note 11)..........     3,510      4,650        117
Other expense, net (Notes 4 and 19).....................................      (572)    (1,651)    (2,753)
                                                                           -------    -------    -------
                                                                           $ 9,776    $ 6,542    $  (920)
                                                                           -------    -------    -------
                                                                           -------    -------    -------
</TABLE>
 
(16) TRANSACTIONS WITH RELATED PARTIES
 
     By  agreement, Triarc provides certain management services including, among
others, legal, accounting, internal  auditing, insurance and financial  services
and incurs certain costs on behalf of its subsidiaries and former affiliates. In
1991,  1992 and  1993, respectively,  $10,596,000, $8,854,000  and $9,181,000 of
these costs  were  borne by  Triarc  Companies and  $7,437,000,  $8,084,000  and
$6,640,000,  including interest  on past  due balances,  were charged  to former
affiliates. Triarc is obligated to  provide certain limited management  services
to  several  former  non-subsidiary  affiliates through  October  1993  and will
discontinue such services thereafter. Triarc also leases space on behalf of  its
subsidiaries and former affiliates from a trust for the benefit of Victor Posner
and  his children. In 1991, 1992  and 1993, respectively, $7,299,000, $7,451,000
and $5,790,000  of  the cost  of  such leased  space  was borne  by  Triarc  and
$1,946,000,  $1,124,000  and  $826,000  was  charged  to  former  affiliates. In
connection with the  Reorganization, all outstanding  rent obligations for  such
leased  space aggregating  approximately $20,638,000  were settled  on April 23,
1993 for  $11,738,000 resulting  in  a rent  reduction credit  of  approximately
$8,900,000  included in 'Other income (expense), net'. At April 30, 1992, Triarc
owed rent  and  late charges  aggregating  $14,550,000, which  was  included  in
'Accounts  payable'. In July 1993, Triarc Companies gave notice to terminate the
lease effective  January  31,  1994  and  recorded  a  charge  of  approximately
$13,000,000  included in 'Facilities relocation  and corporate restructuring' in
the year ended April 30, 1993 to provide for the remaining payments on the lease
subsequent to its  cancellation. As  described below, certain  amounts due  from
former  affiliates  under  such  cost  sharing  arrangements  were  reserved and
reallocated among  Triarc Companies  and  the other  participants in  such  cost
sharing arrangements.
 
     Insurance  and Risk Management, Inc. ('IRM'),  a former affiliate, acted as
agent or broker in connection with certain insurance coverage obtained by Triarc
Companies  and  provided  claims  processing  services  for  Triarc   Companies.
Commissions  and payments  for such  services to  IRM amounted  to $1,727,000 in
1991, $1,778,000 in  1992 and $1,591,000  in 1993. Such  services from IRM  have
been discontinued subsequent to April 1993.
 
     During  Fiscal  1993, Triarc  Companies  used corporate  aircraft  owned by
Triangle Aircraft Services Corporation ('TASCO'), a corporation wholly-owned  by
Messrs.  Peltz  and  May,  in  connection with  business  trips  related  to the
Reorganization for which Triarc Companies  incurred usage fees of  approximately
$754,000.
 
     NPC  Leasing Corp. leases vehicles and  other equipment to subsidiaries and
former affiliates under long-term lease  obligations which are accounted for  as
direct  financing leases.  Lease billings  by NPC  Leasing to  former affiliates
during 1991, 1992 and 1993 were approximately $1,182,000, $703,000 and $144,000,
respectively.  Lease   billings  receivable   and  direct   finance-type   lease
receivables  from former affiliates  of Triarc Companies,  which are included in
'Receivables' and 'Other assets', aggregated
 
                                      F-26
 
<PAGE>
                    TRIARC COMPANIES, INC. AND SUBSIDIARIES
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
                                 APRIL 30, 1993
 
approximately $132,000 and $42,000  at April 30, 1992  and 1993 ,  respectively,
net of allowance for doubtful accounts of $2,202,000 at April 30, 1992.
 
     In  connection with  certain cost  sharing agreements,  advances, insurance
premiums,  equipment  leases   and  accrued  interest,   Triarc  Companies   had
receivables  due from APL  Corporation ('APL'), a  former affiliate, aggregating
$38,120,000 as  of  April 30,  1992,  against  which a  valuation  allowance  of
$34,713,000  was recorded. During the year ended April 30, 1993 Triarc Companies
provided an additional $9,863,000, of  which $3,570,000 was provided during  the
fourth  quarter, for the unreserved portion of  the receivable at April 30, 1992
and additional net billings  in 1993. APL has  experienced recurring losses  and
other  financial difficulties in recent years and in June 1993 certain creditors
of APL filed  an involuntary petition  for relief under  the Federal  bankruptcy
code  against APL. Accordingly,  Triarc Companies wrote off  the full balance of
the APL receivables and related allowance of $44,576,000 during Fiscal 1993.
 
     Triarc Companies also had secured receivables from Pennsylvania Engineering
Corporation ('PEC'), a former affiliate, aggregating $6,664,000 as of April  30,
1992  against which  a $3,664,000 valuation  allowance was  recorded. During the
fourth quarter of the  year ended April 30,  1993, Triarc Companies provided  an
additional  $3,000,000 for  the unreserved portion  of the  receivables. PEC had
also filed  for  protection under  the  bankruptcy code  and,  moreover,  Triarc
Companies  has significant doubts as to  the net realizability of the underlying
collateral.
 
     See also Notes 2, 7, 12 and  19 with respect to certain other  transactions
with related parties.
 
(17) ACCOUNTING FOR LEASES
 
     Triarc Companies leases buildings and improvements, machinery and equipment
and  automotive and transportation  equipment for periods  that vary between one
and twenty years. Some  leases provide for contingent  rentals based upon  sales
volume,  mileage or  production. For  the years ended  April 30,  1991, 1992 and
1993, rental  expense  amounted  to $14,606,000,  $15,681,000  and  $28,302,000,
including  $13,000,000  for  termination  of  the  lease  on  Triarc  Companies'
corporate office facility effective January 31, 1994 (see Note 16), for  minimum
rentals  and $1,077,000,  $986,000 and  $1,021,000 for  contingent rentals, less
$621,000, $634,000 and $593,000 for sublease rental income, respectively.
 
     The following  table shows  Triarc Companies'  future minimum  rentals  for
leases having an initial lease term in excess of one year as of April 30, 1993:
 
<TABLE>
<CAPTION>
                                                                                      LEASES
                                                                       -------------------------------------
                                                                       CAPITALIZED    OPERATING    SUBLEASE
                        YEAR ENDED APRIL 30,                             LEASES        LEASES       INCOME
- --------------------------------------------------------------------   -----------    ---------    ---------
                                                                                  (IN THOUSANDS)
<S>                                                                    <C>            <C>          <C>
1994................................................................     $ 2,739       $10,733      $   917
1995................................................................       2,311        10,210          806
1996................................................................       2,176         9,266          684
1997................................................................       2,100         7,526          413
1998................................................................       1,922         5,883          403
Thereafter..........................................................      10,839        34,294          240
                                                                       -----------    ---------    ---------
Total minimum payments..............................................      22,087       $77,912      $ 3,463
                                                                                      ---------    ---------
                                                                                      ---------    ---------
Less interest.......................................................      10,192
                                                                       -----------
Present value of minimum capitalized lease payments.................     $11,895
                                                                       -----------
                                                                       -----------
</TABLE>
 
     Present  value of minimum  capitalized lease payments  is included together
with  long-term  debt  and  the  current  portion  of  long-term  debt  in   the
accompanying consolidated balance sheets. See Note 11.
 
                                      F-27
 
<PAGE>
                    TRIARC COMPANIES, INC. AND SUBSIDIARIES
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
                                 APRIL 30, 1993
 
(18) LEGAL MATTERS
 
     Triarc  and certain of its present  and former directors were defendants in
certain litigation brought in the United States District Court for the  Northern
District  of Ohio (the  'Ohio Court'). In  April 1993, the  Ohio Court entered a
final order approving  a Modification  (the 'Modification')  which modified  the
terms  of  a  previously  approved  stipulation  of  settlement  (the  'Original
Stipulation') in such  litigation. The Modification  resulted in the  dismissal,
with  prejudice, of all actions before the Ohio Court. Triarc Companies recorded
charges to  operations for  related legal  fees of  $219,000 and  $2,004,000  in
Fiscal  1991 and  1992, respectively, and  $6,225,000 in  Fiscal 1993, including
$2,872,000 during the fourth quarter, included in 'Other income (expense),  net'
in the accompanying consolidated statements of operations.
 
     In  December  1990, a  purported shareholder  derivative suit  (the 'Ehrman
Litigation') was  brought against  SEPSCO's  directors at  that time  and  other
certain  corporations, including Triarc, in the United States District Court for
the Southern District of Florida. The amended complaint in such action  alleges,
among  other  things, that  the defendants  breached  their fiduciary  duties to
SEPSCO and  RC/Arby's  by causing  RC/Arby's  to issue  approximately  4,100,000
shares  of  convertible  redeemable  preferred  stock  to  Triarc  for  cash and
forgiveness  of  indebtedness  of  $41,350,000,  which  preferred  stock,   upon
conversion,   resulted  initially  in  Triarc   owning  approximately  88.7%  of
RC/Arby's' outstanding voting securities and reduced SEPSCO's ownership of  such
corporation   from  48%  to  5.4%,  by  causing  Chesapeake  Insurance,  then  a
wholly-owned subsidiary of RC/Arby's, to  suffer large losses in the  operations
of  its business in order  to make RC/Arby's seem  less successful than it truly
was, and by  causing the  allegedly unfair  sale by  SEPSCO in  January 1986  of
shares   of  Graniteville's  common  stock  constituting  approximately  51%  of
Graniteville's outstanding common stock to Triarc. On April 24, 1993, the  Board
of Directors of Triarc approved the terms of a proposed settlement of the Ehrman
Litigation   in  accordance  with  the  terms  set  forth  in  a  Memorandum  of
Understanding dated January 21, 1993 (the 'January Memorandum') entered into  by
DWG  Acquisition  and  the  plaintiff in  the  Ehrman  Litigation.  The proposed
settlement of  the  Ehrman Litigation  contemplated  by the  January  Memorandum
provides,  among other  things, that SEPSCO  would be merged  into, or otherwise
acquired by Triarc or an affiliate thereof, on the following terms: each  holder
of  common stock of SEPSCO  other than Triarc will  receive in exchange for each
share of common stock of SEPSCO, .55 shares of Triarc Class A Common Stock and a
note (or appropriate portion  of a note)  payable by Triarc  or SEPSCO having  a
principal  amount of $6.00, and SEPSCO's common stock, par value $1.00 per share
('SEPSCO Common Stock') would  be delisted from the  Pacific Stock Exchange  and
would  be eligible  for termination of  registration pursuant  to the Securities
Exchange Act of 1934. Triarc or SEPSCO will pay the reasonable fees and expenses
of counsel to  the plaintiff in  the action, as  awarded by the  court, and  the
stockholders  of SEPSCO will  thus receive the merger  consideration net of such
fees and expenses. Plaintiff's counsel will be paid, subject to court  approval,
an  amount not to exceed $650,000 in cash  and $650,000 in value in notes (which
notes will be identical in  form and substance to  the notes distributed to  the
SEPSCO  stockholders). In  addition, SEPSCO accrued  $400,000 for  its own legal
fees. Such amounts  were accrued by  Triarc Companies in  the fourth quarter  of
Fiscal   1993  and  are  included  in  'Other  income  (expense),  net'  in  the
accompanying  consolidated  statement  of  operations  and  in  'Other   current
liabilities'  in the  accompanying consolidated  balance sheet  as of  April 30,
1993. The settlement  of the Ehrman  Litigation is conditioned  on, among  other
things,  approval by the District Court. SEPSCO  and the plaintiff in the Ehrman
litigation are currently discussing a modification to the January Memorandum  to
provide  that the  consideration to be  received would consist  solely of Triarc
Class A  Common Stock  based on  a revised  exchange ratio  which is  yet to  be
determined.  Such revised ratio is currently expected to be .80 shares of Triarc
Class A  Common  Stock  for each  share  of  SEPSCO Common  Stock,  although  no
assurance  can be given  that a definitive  agreement can be  reached as to such
matter. Following such merger  or acquisition, Triarc would  own 100% of  SEPSCO
Common Stock.
 
                                      F-28
 
<PAGE>
                    TRIARC COMPANIES, INC. AND SUBSIDIARIES
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
                                 APRIL 30, 1993
 
     In  1987, Graniteville  was notified  by the  South Carolina  Department of
Health  and   Environmental  Control   ('DHEC')  that   it  discovered   certain
contamination  of  Langley  Pond  near  Graniteville,  South  Carolina  and DHEC
asserted that  Graniteville may  be  one of  the  parties responsible  for  such
contamination.  Graniteville  entered into  a consent  decree providing  for the
study and investigation  of the  alleged pollution  and its  sources. The  study
report,  prepared by Graniteville's environmental consulting firm and filed with
DHEC in April 1990, recommended that  pond sediments be left undisturbed and  in
place.   DHEC  responded  by  requesting  that  Graniteville  submit  additional
information concerning potential passive and active remedial alternatives,  with
accompanying  supportive  information. In  May  1991 Graniteville  provided this
information to DHEC in a report of Graniteville's environmental consulting firm.
The 1990  and  1991  reports  concluded  that  pond  sediments  should  be  left
undisturbed  and in place  and that other  less passive remediation alternatives
either provided  no  significant  additional  benefits  or  themselves  involved
adverse  effects  on  human health,  to  existing  recreational uses  or  to the
existing biological communities. Triarc Companies  is unable to predict at  this
time  what further actions, if  any, may be required  in connection with Langley
Pond or what the cost thereof may be. Two years have passed since the submission
of the two reports by  Graniteville's environmental consulting firm without  any
objection  or adverse comment on such  reports by DHEC and desirable remediation
alternatives, other than continuing to leave the Langley Pond sediments in place
and undisturbed as described in the reports, are not available.
 
     As a result of certain environmental audits in 1991, SEPSCO became aware of
possible contamination by hydrocarbons and  metals at certain sites of  SEPSCO's
refrigeration  operations  and has  filed  appropriate notifications  with state
environmental authorities and has  begun a study of  remediation at such  sites.
SEPSCO  has  removed  certain underground  storage  and other  tanks  at certain
facilities  of  its  refrigeration  operations   and  has  engaged  in   certain
remediation  in connection therewith. Such removal and environmental remediation
involved a  variety  of remediation  actions  at various  facilities  of  SEPSCO
located in a number of jurisdictions. Such remediation varied from site to site,
ranging  from testing of soil and  groundwater for contamination, development of
remediation plans  and  removal in  certain  instances of  certain  contaminated
soils.  Based  on preliminary  information and  consultations with,  and certain
reports of, environmental consultants and others, SEPSCO presently estimates the
cost of such remediation  and/or removal will  approximate $3,661,000, of  which
$1,300,000,  $200,000 and $2,161,000 was provided  in its fiscal years ending in
1991, 1992 and 1993, respectively, and has been included in 'Income (loss)  from
discontinued   operations'  in  the   accompanying  consolidated  statements  of
operations. In  connection  therewith,  SEPSCO  has  incurred  actual  costs  of
$803,000  and has a  remaining accrual of $2,858,000  included in 'Other current
assets and liabilities, net' in Note 3.
 
     In 1991, Triarc Companies became  aware that lead and cadmium  contaminants
are  present at  a site owned  by a  non-core subsidiary of  Triarc Companies at
which the subsidiary had disposed of decorative glass products produced prior to
1980. The Pennsylvania Department of  Environmental Regulation (the 'PDER')  has
been  informed of this matter and Triarc  Companies expects to develop, with the
PDER, a plan of  remediation. The remediation  actions being considered  include
capping  the  materials  in  place  or removing  the  materials  to  an approved
landfill. Triarc Companies has no reason  to believe that any of the  decorative
glass  products  produced  by  its  subsidiary  exceeded  or  were  in  any  way
inconsistent with applicable standards,  including health and safety  standards,
for  consumer  use  of  glass products.  Triarc  Companies  recorded  charges to
operations of $900,000 in fiscal 1993 for the estimated costs of the anticipated
plan of remediation.
 
     Triarc Companies is also engaged in ordinary routine litigation  incidental
to  its  business. Triarc  Companies does  not believe  that the  litigation and
matters referred to  above, as well  as such ordinary  routine litigation,  will
have a material adverse effect on its consolidated financial position or results
of operations.
 
                                      F-29
 
<PAGE>
                    TRIARC COMPANIES, INC. AND SUBSIDIARIES
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
                                 APRIL 30, 1993
 
(19) SIGNIFICANT FOURTH QUARTER 1993 CHARGES
 
     The  accompanying  consolidated statements  of  operations for  Fiscal 1993
include the  following significant  charges recorded  in the  fourth quarter  of
Fiscal 1993 (in thousands):
 
<TABLE>
<S>                                                                                            <C>
Estimated costs to relocate Triarc Companies' headquarters and terminate the lease on its
  existing corporate facilities (see Note 16).............................................   $14,900
Estimated restructuring charges including personnel recruiting and relocation costs,
  employee severance costs and consultant fees............................................    20,300
Costs related to a five-year consulting agreement extending through April 1998 between
  Triarc and its former Vice Chairman.....................................................     6,000
Other restructuring costs.................................................................     1,800
                                                                                             -------
     Total estimated restructuring and facilities relocation charges (i)..................    43,000
Write-off of uncollectible notes and other amounts due from former affiliates (see Note
  16), net of a recovery of $1,430........................................................     5,140(a)
Payment to the Special Committee of Triarc Companies' Board of Directors (ii).............     4,900(b)
Provision for closing of certain non-strategic, Triarc-owned restaurants and abandoned
  bottling facilities (iii)...............................................................     2,200(b)
Estimated costs to comply with new package labeling regulations (iv)......................     1,500(b)
Reversal of unpaid incentive plan accruals provided in prior years (see
  Note 14)................................................................................    (7,297)(b)
Other.....................................................................................     2,246(b)
                                                                                             -------
     Total net charges affecting operating profit.........................................    51,689
Interest accruals relating to income tax matters (see Note 10)............................     6,109(c)
Costs of certain shareholder and other litigation (v).....................................     5,947(d)
Settlement of accrued rent balance in connection with the Reorganization (see Note 16)....    (8,900)(d)
Commitment fees and other compensation costs relating to a proposed alternative financing
  with a syndicate of banks which was not consummated because of the issuance of the
  Step-Up Notes (see Note 11).............................................................     3,200(d)
Reduction to estimated net realizable value of certain assets held for sale other than
  discontinued operations.................................................................     2,147(d)
Income tax benefit relating to the above net charges......................................   (15,435)
Provision for income tax contingencies and other tax matters (see Note 10)................     7,897
Minority interest effect of above net charges.............................................    (3,956)
Write-down relating to the impairment of certain unprofitable operations and accruals for
  environmental remediation and losses of certain contracts in progress of discontinued
  operations, net of income tax benefit and minority interests (see Note 3)...............     5,363
Extraordinary item, net (see Note 11).....................................................     6,611
Cumulative effect of changes in accounting principles, net, retroactively reflected in the
  first quarter (see Note 1)..............................................................     6,388
                                                                                             -------
                                                                                             $67,060
                                                                                             -------
                                                                                             -------
</TABLE>
 
- ------------
 
 (a) Included in 'Provision for doubtful accounts from affiliates'.
 
 (b) Included in 'Selling, general and administrative expenses'.
 
 (c) Included in 'Interest expense'.
 
 (d) Included in 'Other income (expense), net'.
 
          (i)  In  1993, results  of operations  were significantly  impacted by
     facilities  relocation  and  corporate  restructuring  charges  aggregating
     $43,000,000  consisting of: (i) estimated  costs of $14,900,000 to relocate
     Triarc Companies' corporate headquarters and to terminate the lease on  its
     existing  corporate  facilities;  (ii) estimated  restructuring  charges of
     $20,300,000 including costs associated  with hiring and relocating  certain
     new  senior management including chief executive officers of the fast food,
     soft drink  and  liquefied  petroleum  gas  segments  and  other  personnel
 
                                      F-30
 
<PAGE>
                    TRIARC COMPANIES, INC. AND SUBSIDIARIES
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
                                 APRIL 30, 1993
 
     recruiting  and relocation  costs, employee severance  costs and consultant
     fees; (iii) total costs  of $6,000,000 relating  to a five-year  consulting
     agreement (the 'Consulting Agreement') extending through April 1998 between
     Triarc and Steven Posner, the former Vice Chairman of Triarc Companies, and
     (iv)  costs  of $1,800,000  in  connection with  a  strategic restructuring
     within the textiles segment. The charges  referred to in items (i)  through
     (iii)  above  related to  the change  in control  of Triarc  Companies that
     resulted from the Reorganization  described in Note  2. In connection  with
     the  Closing,  Victor Posner  and Steven  Posner  resigned as  officers and
     directors of Triarc Companies. In order to induce Steven Posner to  resign,
     Triarc  entered into the Consulting Agreement with him. The cost related to
     the Consulting  Agreement was  recorded as  a charge  in 1993  because  the
     Consulting  Agreement does not require  any substantial services and Triarc
     Companies  does  not  expect  to  receive  any  services  that  will   have
     substantial  value to it. As a part  of the Closing, the Board of Directors
     of  Triarc  Companies   was  reconstituted.  The   first  meeting  of   the
     reconstituted  Board  of Directors  was  held on  April  24, 1993.  At that
     meeting, based on a report and recommendations from a management consulting
     firm that had conducted an extensive review of Triarc Companies' operations
     and management  structure,  the  Board  of Directors  approved  a  plan  of
     decentralization  and restructuring which entailed, among other things, the
     following features: (i) the strategic  decision to manage Triarc  Companies
     in  the future on a decentralized, rather than on a centralized basis; (ii)
     the hiring of new executive officers for Triarc and the hiring of new chief
     executive officers and new senior management  teams for each of Arby's,  RC
     Cola and National Propane to carry out the decentralization strategy; (iii)
     the  termination of a significant  number of employees as  a result of both
     the new management  philosophy and  the hiring  of an  almost entirely  new
     management  team; and (iv) the relocation  of the corporate headquarters of
     Triarc and of all  of its subsidiaries whose  headquarters were located  in
     South  Florida, including Arby's, RC Cola,  National Propane and SEPSCO. In
     connection with (ii)  above, in  April 1993 Triarc  Companies entered  into
     employment  agreements with the new  president and chief executive officers
     of RC Cola, Arby's, Graniteville and National Propane. Accordingly,  Triarc
     Companies'  cost to relocate  its corporate headquarters  and terminate the
     lease on  its existing  corporate facilities  ($14,900,000), and  estimated
     corporate  restructuring charges of  $20,300,000 including costs associated
     with hiring  and  relocating  new senior  management  and  other  personnel
     recruiting  and relocation  costs, employee severance  costs and consulting
     fees, all stemmed from the decentralization and restructuring plan formally
     adopted at the April  24, 1993 meeting of  Triarc's reconstituted Board  of
     Directors.
 
          (ii)   In  accordance  with  certain  court  proceedings  and  related
     settlements, five  directors,  including three  court-appointed  directors,
     were appointed in 1991 to serve on the Triarc Special Committee of Triarc's
     Board  of Directors.  Such committee  was empowered  to review  and pass on
     transactions between Triarc and Victor Posner, the then largest shareholder
     of Triarc, and his affiliates. A success fee payable to the Triarc  Special
     Committee  attributable  to  the  closing  of  the  Reorganization  and the
     resulting change in control  was approved in the  aggregate cash amount  of
     $4,900,000.
 
          (iii)  Triarc Companies  has three abandoned  bottling facilities that
     were closed in 1983 and have a net book value of $1,500,000 as of April 30,
     1993. Prior management  of Triarc  Companies did not  undertake any  active
     program  to sell the properties. Triarc Companies had periodically assessed
     the valuation of the carrying value of such properties and determined  that
     in the aggregate there was no impairment in value and no writedown had been
     recorded. In connection with the Reorganization, new management has changed
     Triarc  Companies' strategy  and plans  to follow  a policy  of accelerated
     disposition where the ultimate sales price can be significantly less than a
     willing buyer and seller not  under such time constraints would  negotiate.
     Accordingly,  new management provided $400,000 during the fourth quarter of
     Fiscal 1993  to  reduce  the  carrying value  of  such  properties  to  the
     currently   estimated   net   realizable   value.   Also,   new  management
 
                                      F-31
 
<PAGE>
                    TRIARC COMPANIES, INC. AND SUBSIDIARIES
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
                                 APRIL 30, 1993
 
     reviewed the restaurant operations  of Arby's and  decided to close  eleven
     unprofitable  restaurants  pursuant  to new  management's  strategic plans.
     Triarc Companies provided an aggregate $1,700,000 relating to the  decision
     to close the restaurants during the fourth quarter of Fiscal 1993 including
     (i)  $600,000 relating  to the writeoff  of the difference  between the net
     book value  of such  properties  and their  anticipated sales  value,  (ii)
     $800,000 relating to operating losses through the expected dates of closure
     (nine  restaurants in calendar 1993 and  two restaurants in 1994) and (iii)
     $300,000 relating  to the  estimated loss  on sublease  for one  restaurant
     extending to 2004.
 
          (iv) Triarc Companies is required to change the labeling on all of its
     RC  Cola  products  as  a  result  of  the  Food  and  Drug  Administration
     Regulations (the 'Regulations') issued  pursuant to the Nutrition  Labeling
     and  Education Act (the 'Act') of  1990. The Regulations which provided the
     necessary guidance to implement the requirements of the Act were issued  in
     January  1993. At that time Triarc Companies  was able to estimate the cost
     of compliance and accordingly recorded a provision of $1,500,000.
 
          (v) Includes legal fees and settlement costs aggregating approximately
     $4,572,000 in connection  with the Granada-related  and Ehrman  shareholder
     litigation described in Note 18 settled or to be settled in connection with
     the   Reorganization,  settlement  costs   of  approximately  $750,000  for
     litigation involving  a  former  subsidiary  settled  in  August  1993  and
     settlement  costs  of  approximately $625,000  for  litigation  involving a
     former employee  settled in  May 1993.  Such current  and past  shareholder
     litigation  costs are essentially offset by an $8,900,000 credit due to the
     settlement in  connection  with the  Reorganization  of accrued  rent  owed
     Posner described in Note 16.
 
(20) BUSINESS SEGMENTS
 
     Triarc Companies operates in four major segments: textiles, fast food, soft
drink  and liquefied petroleum gas. The  textiles segment manufactures, dyes and
finishes cotton, synthetic and blended (cotton and polyester) fabrics, primarily
for the apparel  trade and mainly  for two end  uses: (1) utility  wear and  (2)
men's,  women's and children's  sportswear, casual wear  and outerwear. The fast
food segment operates and franchises  Arby's fast food restaurants, the  largest
franchise  restaurant  system specializing  in roast  beef sandwiches.  The soft
drink segment produces  and sells  soft drink concentrates  under the  principal
brand  names RC COLA, DIET RC COLA, DIET  RITE, NEHI and UPPER 10. The liquefied
petroleum gas segment distributes and  sells liquefied petroleum gas. The  other
segment consists of non-core businesses including (i) insurance and reinsurance,
(ii)  specialty  decorations  of  glass and  ceramic  items,  (iii)  the design,
manufacture and servicing  of overhead industrial  cranes, (iv) the  manufacture
and distribution of lamps and (v) the operation of certain grapefruit groves.
 
     Information  concerning  the  various segments  in  which  Triarc Companies
operates is shown  in the table  below. Operating profit  is total revenue  less
operating  expenses. In computing operating profit,  none of the following items
have  been  included:  interest  expense,  interest  income,  general  corporate
expenses,  other  non-operating income  and expenses,  and income  tax provision
(benefits). Identifiable assets  by segment are  those assets that  are used  in
Triarc  Companies' operations in each  segment. General corporate assets consist
primarily of cash and equivalents,  non-trade accounts and notes receivable  and
deferred  financing costs. See Notes 15 and 19 for the major components of other
income (expense), net.
 
     No customer accounted for more than  10% of consolidated revenues in  1991,
1992 or 1993.
 
                                      F-32
 
<PAGE>
                    TRIARC COMPANIES, INC. AND SUBSIDIARIES
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
                                 APRIL 30, 1993
 
<TABLE>
<CAPTION>
                                                                                    YEAR ENDED APRIL 30,
                                                                           --------------------------------------
                                                                              1991          1992          1993
                                                                           ----------    ----------    ----------
                                                                                       (IN THOUSANDS)
<S>                                                                        <C>           <C>           <C>
Revenues:
  To unaffiliated customers:
     Textiles...........................................................   $  414,174    $  456,402    $  499,060
     Fast Food..........................................................      181,293       186,921       198,915
     Soft Drink.........................................................      138,082       143,830       148,262
     Liquefied Petroleum Gas............................................      150,348       141,032       148,790
     Other..............................................................      143,265       146,518        63,247
                                                                           ----------    ----------    ----------
          Consolidated revenues.........................................   $1,027,162    $1,074,703    $1,058,274
                                                                           ----------    ----------    ----------
                                                                           ----------    ----------    ----------
Operating profit (loss):
     Textiles...........................................................   $   11,970    $   27,753    $   47,203
     Fast Food..........................................................       12,652        14,271         7,852
     Soft Drink.........................................................       30,597        36,112        23,461
     Liquefied Petroleum Gas............................................       13,628        12,676         3,008
     Other..............................................................      (19,208)       (5,746)      (15,942)
                                                                           ----------    ----------    ----------
          Segment operating profit......................................       49,639        85,066        65,582
     Interest expense...................................................      (66,761)      (71,832)      (72,830)
     Non-operating income (expense), net................................        9,776         6,542          (920)
     General corporate expenses.........................................      (26,335)      (26,514)      (31,123)
                                                                           ----------    ----------    ----------
          Consolidated loss from continuing operations before income
            taxes, minority interests, extraordinary items and
            cumulative effect of changes in accounting principles.......   $  (33,681)   $   (6,738)   $  (39,291)
                                                                           ----------    ----------    ----------
                                                                           ----------    ----------    ----------
Identifiable assets:
     Textiles...........................................................   $  223,450    $  215,215    $  281,544
     Fast Food..........................................................       90,231        88,236        99,455
     Soft Drink.........................................................      161,789       183,942       184,364
     Liquefied Petroleum Gas............................................      117,093       109,432       123,341
     Other..............................................................      129,886       122,035        62,715
                                                                           ----------    ----------    ----------
          Total identifiable assets.....................................      722,449       718,860       751,419
     General corporate assets...........................................       62,157        35,611        92,334
     Discontinued operations, net.......................................       67,306        66,699        66,909
                                                                           ----------    ----------    ----------
          Consolidated assets...........................................   $  851,912    $  821,170    $  910,662
                                                                           ----------    ----------    ----------
                                                                           ----------    ----------    ----------
Capital expenditures:
     Textiles...........................................................   $   16,337    $   11,399    $   10,075
     Fast Food..........................................................       13,854         9,079         6,231
     Soft Drink.........................................................          602           558           870
     Liquefied Petroleum Gas............................................        7,614         7,039         8,290
     Corporate..........................................................          303           205            42
     Other..............................................................        2,732         2,973         1,699
                                                                           ----------    ----------    ----------
          Consolidated capital expenditures.............................   $   41,442    $   31,253    $   27,207
                                                                           ----------    ----------    ----------
                                                                           ----------    ----------    ----------
Depreciation, depletion and amortization:
     Textiles...........................................................   $    8,364    $    9,897    $   10,380
     Fast Food..........................................................        8,639         9,866        10,891
     Soft Drink.........................................................        4,763         5,125         5,460
     Liquefied Petroleum Gas............................................        8,762         8,479         8,196
     Corporate..........................................................          613           562           587
     Other..............................................................        2,743         2,609         2,467
                                                                           ----------    ----------    ----------
          Consolidated depreciation, depletion and amortization.........   $   33,884    $   36,538    $   37,981
                                                                           ----------    ----------    ----------
                                                                           ----------    ----------    ----------
</TABLE>
 
                                      F-33
 
<PAGE>
                    TRIARC COMPANIES, INC. AND SUBSIDIARIES
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
                                 APRIL 30, 1993
 
(21) QUARTERLY INFORMATION (UNAUDITED)
 
<TABLE>
<CAPTION>
                                                                                 THREE MONTHS ENDED
                                                                 ---------------------------------------------------
                                                                 JULY 31     OCTOBER 31    JANUARY 31    APRIL 30(A)
                                                                 --------    ----------    ----------    -----------
                                                                      (IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
<S>                                                              <C>         <C>           <C>           <C>
1992
     Revenues.................................................   $250,900     $250,551      $288,469      $ 284,783
     Gross profit.............................................     66,718       66,208        72,049         71,760
     Operating profit.........................................     10,965       10,153        16,558         20,876
     Income (loss) from continuing operations.................     (4,516)      (6,420)       (1,860)         2,589
     Income (loss) from discontinued operations, net..........      1,394        1,767           485           (941)
     Net income (loss)........................................     (3,122)      (4,653)       (1,375)         1,648
     Income (loss) per share:
          Continuing operations...............................       (.17)        (.25)         (.07)           .10
          Discontinued operations.............................        .05          .07           .02           (.04)
          Net income (loss)...................................       (.12)        (.18)         (.05)           .06
1993
     Revenues.................................................   $268,288     $254,083      $277,607      $ 258,296
     Gross profit.............................................     69,735       67,557        74,486         79,701
     Operating profit (loss)..................................     14,691       17,438        25,016        (22,686)
     Loss from continuing operations..........................     (1,843)      (2,555)       (1,841)       (38,310)
     Income (loss) from discontinued operations, net..........        691        1,325           899         (5,345)
     Extraordinary item, net..................................      --          --            --             (6,611)
     Cumulative effect of changes in accounting principles,
       net....................................................     (6,388)      --            --             --
     Net loss.................................................     (7,540)      (1,230)         (942)       (50,266)
     Income (loss) per share:
          Continuing operations...............................       (.07)        (.10)         (.07)         (1.50)
          Discontinued operations.............................        .03          .05           .03           (.21)
          Extraordinary item..................................      --          --            --               (.26)
          Cumulative effect of changes in accounting
            principles........................................       (.25)      --            --             --
          Net loss............................................       (.29)        (.05)         (.04)         (1.97)
</TABLE>
 
- ------------
 
 (A) As  described in Note 19, results of  operations for the three months ended
     April 30, 1993 were materially affected by facilities relocation, corporate
     restructuring  and  other  significant  charges  aggregating  approximately
     $60,672,000,  net  of  income  tax  benefit  and  minority  interests,  and
     exclusive of  the cumulative  effect of  changes in  accounting  principles
     which was retroactively recorded in the first quarter.
 
(22) EVENTS SUBSEQUENT TO DATE OF AUDITORS' REPORT
 
     On  October 27, 1993 Triarc's stockholders approved a change in the name of
the company from DWG Corporation to Triarc Companies, Inc. and is so referred to
herein.
 
     In the quarter ended October 31,  1993 Triarc recorded a provision for  the
estimated  loss on  disposal of  discontinued operations  of $7,397,000,  net of
minority interests of $3,003,000. Such provision was determined based on (i) the
sale of the utility and municipal  securities business segment in October  1993,
(ii)  the  signing of  a  letter of  intent  in November  1993  to sell  the ice
operations of SEPSCO's refrigeration segment, (iii) a re-evaluation of the  cold
storage  operations based on  preliminary sales discussions  and experience with
respect to negotiating the sale of the  other operations and (iv) the effect  of
SEPSCO's  December 9, 1993 Board of  Directors' decision to transfer the natural
gas and oil business from SEPSCO to Triarc rather than selling such business  to
an  independent third party. Such transfer will be  in the form of a sale of the
stock of the entities comprising  the natural gas and  oil business for cash  of
$8,500,000  which is equal to their fair value. See Notes 2 and 12 to the Triarc
Companies, Inc. and subsidiaries condensed consolidated financial statements for
the six months  ended October 31,  1993 contained elsewhere  herein for  further
information.
 
                                      F-34

<PAGE>
                    TRIARC COMPANIES, INC. AND SUBSIDIARIES
                     CONDENSED CONSOLIDATED BALANCE SHEETS
 
<TABLE>
<CAPTION>
                                                                                           APRIL 30,    OCTOBER 31,
                                                                                             1993           1993
                                                                                           ---------    ------------
                                                                                                (IN THOUSANDS)
                                                                                              (A)       (UNAUDITED)
<S>                                                                                        <C>          <C>
                                         ASSETS
Current assets:
     Cash and equivalents...............................................................   $  96,635      $ 87,178
     Receivables, net...................................................................     116,257       109,122
     Inventories........................................................................      98,270       114,661
     Deferred income taxes..............................................................      21,365        22,632
     Net current assets of discontinued operations......................................       6,823        33,062
     Other current assets...............................................................      19,996        29,596
                                                                                           ---------    ------------
          Total current assets..........................................................     359,346       396,251
                                                                                           ---------    ------------
Restricted cash and short-term investments of insurance operations......................      18,271        27,062
Properties, net.........................................................................     237,853       242,463
Unamortized costs in excess of net assets of acquired companies.........................     186,572       184,115
Net non-current assets of discontinued operations.......................................      60,086        15,822
Other assets............................................................................      48,534        47,726
                                                                                           ---------    ------------
                                                                                           $ 910,662      $913,439
                                                                                           ---------    ------------
                                                                                           ---------    ------------
                         LIABILITIES AND STOCKHOLDERS' DEFICIT
Current liabilities:
     Current portion of long-term debt..................................................   $  43,100      $ 38,834
     Accounts payable...................................................................      71,729        48,178
     Accrued facilities relocation and corporate restructuring costs....................      42,000        35,970
     Other current liabilities..........................................................      69,011        75,574
                                                                                           ---------    ------------
          Total current liabilities.....................................................     225,840       198,556
                                                                                           ---------    ------------
Long-term debt..........................................................................     488,654       540,355
Insurance loss reserves.................................................................      76,763        86,277
Deferred income taxes...................................................................      35,991        41,404
Deposits and other liabilities..........................................................      17,157        12,148
Minority interests......................................................................      29,850        27,654
Redeemable preferred stock..............................................................      71,794        71,794
Stockholders' equity (deficit):
     Common Stock.......................................................................       2,825         2,842
     Additional paid-in capital.........................................................      52,372        56,338
     Accumulated deficit................................................................      (6,067)      (35,868)
     Treasury stock.....................................................................     (80,109)      (80,109)
     Other..............................................................................      (4,408)       (7,952)
                                                                                           ---------    ------------
          Total stockholders' deficit...................................................     (35,387)      (64,749)
                                                                                           ---------    ------------
                                                                                           $ 910,662      $913,439
                                                                                           ---------    ------------
                                                                                           ---------    ------------
</TABLE>
 
- ------------
(A) Derived  from the audited consolidated financial  statements as of April 30,
    1993.
 
     See accompanying notes to condensed consolidated financial statements.
 
                                      F-35
 
<PAGE>
                    TRIARC COMPANIES, INC. AND SUBSIDIARIES
                CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
 
<TABLE>
<CAPTION>
                                                                                               SIX MONTHS ENDED
                                                                                                 OCTOBER 31,
                                                                                             --------------------
                                                                                               1992        1993
                                                                                             --------    --------
                                                                                                (IN THOUSANDS,
                                                                                               EXCEPT PER SHARE
                                                                                                   AMOUNTS)
                                                                                                 (UNAUDITED)
<S>                                                                                          <C>         <C>
Revenues:
     Net sales............................................................................   $497,937    $494,746
     Royalties, franchise fees and other revenues.........................................     24,434      26,724
                                                                                             --------    --------
                                                                                              522,371     521,470
                                                                                             --------    --------
Costs and expenses:
     Cost of sales........................................................................    385,079     368,757
     Selling, general and administrative expenses (Note 2)................................    101,446     130,460
     Provision for doubtful accounts from a former affiliate..............................      3,717       --
                                                                                             --------    --------
                                                                                              490,242     499,217
                                                                                             --------    --------
          Operating profit................................................................     32,129      22,253
                                                                                             --------    --------
Interest expense..........................................................................    (33,058)    (32,924)
Other income (expense), net...............................................................      1,739      (2,256)
                                                                                             --------    --------
                                                                                              (31,319)    (35,180)
                                                                                             --------    --------
          Income (loss) from continuing operations before income taxes and minority
           interests......................................................................        810     (12,927)
Provision for income taxes (Notes 2 and 9)................................................     (4,358)     (6,354)
                                                                                             --------    --------
                                                                                               (3,548)    (19,281)
Minority interests in net (income) loss...................................................       (850)       (347)
                                                                                             --------    --------
          Loss from continuing operations.................................................     (4,398)    (19,628)
Discontinued operations, net of income taxes and minority interests:
          Income (loss) from discontinued operations......................................      2,016         229
          Estimated loss on disposal (Notes 2 and 12).....................................      --         (7,397)
                                                                                             --------    --------
                                                                                                2,016      (7,168)
                                                                                             --------    --------
          Loss before extraordinary item and cumulative effect of changes in accounting
           principles.....................................................................     (2,382)    (26,796)
Extraordinary item, net (Note 6)..........................................................      --           (448)
Cumulative effect of changes in accounting principles, net (Note 1).......................     (6,388)      --
                                                                                             --------    --------
          Net loss........................................................................     (8,770)    (27,244)
Preferred stock dividend requirements.....................................................         (5)     (2,916)
                                                                                             --------    --------
          Net loss applicable to common stockholders......................................   $ (8,775)   $(30,160)
                                                                                             --------    --------
                                                                                             --------    --------
Income (loss) per share:
     Continuing operations................................................................   $   (.17)   $  (1.06)
     Discontinued operations..............................................................        .08        (.34)
     Extraordinary item...................................................................      --           (.02)
     Cumulative effect of changes in accounting principles................................       (.25)      --
                                                                                             --------    --------
                                                                                             $   (.34)   $  (1.42)
                                                                                             --------    --------
                                                                                             --------    --------
</TABLE>
 
     See accompanying notes to condensed consolidated financial statements.
 
                                      F-36
 
<PAGE>
                    TRIARC COMPANIES, INC. AND SUBSIDIARIES
                CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
 
<TABLE>
<CAPTION>
                                                                                                      SIX MONTHS ENDED
                                                                                                        OCTOBER 31,
                                                                                            ------------------------------------
                                                                                                  1992                1993
                                                                                            ----------------    ----------------
                                                                                                       (IN THOUSANDS)
                                                                                                        (UNAUDITED)
<S>                                                                                         <C>                 <C>
Cash flows from operating activities:
     Net loss............................................................................       $     (8,770)      $     (27,244)
     Adjustments to reconcile net loss to net cash and equivalents provided by (used in)
      operating activities of continuing operations:
          Depreciation of properties.....................................................             15,708              15,491
          Amortization of costs in excess of net assets..................................              2,629               2,839
          Amortization of deferred debt discount, deferred financing costs and unearned
            compensation.................................................................              3,203               5,184
          Write-off of deferred financing costs..........................................          --                      2,214
          Gain on sales of assets, net...................................................             (3,375)               (305)
          Minority interests, net of dividends paid......................................                844                 341
          Loss (income) from discontinued operations.....................................             (2,016)              7,168
          Cumulative effect of changes in accounting principles..........................              6,388           --
          Other, net.....................................................................              1,386                  63
          Changes in operating assets and liabilities
          Decrease (increase) in:
               Receivables...............................................................             (5,057)              7,135
               Inventories...............................................................             12,108             (16,391)
               Other current assets......................................................             (3,039)             (9,600)
               Restricted cash of insurance operations...................................             (2,146)             (8,791)
          Increase (decrease) in:
               Accounts payable and other current liabilities............................             (6,555)            (22,776)
               Insurance loss reserves...................................................                123               9,514
               Deferred income taxes.....................................................             (2,103)              4,146
                                                                                            ----------------    ----------------
          Net cash and equivalents provided by (used in) operating activities............              9,328             (31,012)
                                                                                            ----------------    ----------------
Cash flows from investing activities:
     Proceeds from sales of assets.......................................................             26,439               1,298
     Capital expenditures................................................................            (11,041)            (17,293)
                                                                                            ----------------    ----------------
               Net cash and equivalents provided by (used in) investing
                 activities..............................................................             15,398             (15,995)
                                                                                            ----------------    ----------------
Cash flows from financing activities:
     Proceeds from long-term debt borrowings.............................................          --                    283,696
     Repayment of long-term debt.........................................................            (28,789)           (241,169)
     Deferred financing costs............................................................          --                     (3,971)
     Net decrease in short-term debt.....................................................             (6,012)          --
     Payment of dividends on preferred stock.............................................                 (5)             (2,557)
                                                                                            ----------------    ----------------
               Net cash and equivalents provided by (used in) financing activities.......            (34,806)             35,999
                                                                                            ----------------    ----------------
Net cash used in continuing operations...................................................            (10,080)            (11,008)
Net cash provided by discontinued operations.............................................              2,866               1,551
                                                                                            ----------------    ----------------
Net decrease in cash and equivalents.....................................................             (7,214)             (9,457)
Cash and equivalents at beginning of period..............................................             20,514              96,635
                                                                                            ----------------    ----------------
Cash and equivalents at end of period....................................................       $     13,300       $      87,178
                                                                                            ----------------    ----------------
                                                                                            ----------------    ----------------
</TABLE>
 
     See accompanying notes to condensed consolidated financial statements.
 
                                      F-37

<PAGE>
                    TRIARC COMPANIES, INC. AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                OCTOBER 31, 1993
                                  (UNAUDITED)
 
(1) BASIS OF PRESENTATION
 
     The  accompanying unaudited condensed  consolidated financial statements of
the Company have been prepared in  accordance with Rule 10-01 of Regulation  S-X
promulgated  by the  Securities and Exchange  Commission and,  therefore, do not
include all  information and  footnotes  necessary for  a fair  presentation  of
financial  position, results  of operations  and cash  flows in  conformity with
generally accepted  accounting  principles.  In  the  opinion  of  the  Company,
however,   the  accompanying  financial   statements  contain  all  adjustments,
consisting of normal recurring  adjustments and, in  the six-month period  ended
October  31, 1993,  $29.4 million of  aftertax significant  charges discussed in
Note 2 necessary to present fairly the Company's financial position as of  April
30,  1993 and October 31, 1993 and its  results of operations and its cash flows
for the six-month  periods ended  October 31,  1992 and  1993. This  information
should  be read  in conjunction with  the consolidated  financial statements and
notes thereto included in the Company's Annual Report on Form 10-K ('Form 10-K')
for the year ended April 30, 1993.
 
     On October 27, 1993  the Board of Directors  of Triarc, Inc. (formerly  DWG
Corporation  and  referred  to  herein as  'Triarc'  or,  collectively  with its
subsidiaries, 'Triarc Companies') approved a change in Triarc's fiscal year from
a fiscal year ending April 30 to  a calendar year ending December 31,  effective
for  the transition period ending December 31,  1993. The fiscal years of all of
Triarc's subsidiaries which  did not end  on December 31  were also so  changed.
Triarc  plans to  issue a  transition report  on Form  10-K for  the eight-month
period ending December  31, 1993. As  used herein, 'Fiscal  1993' refers to  the
year ended April 30, 1993 and 'Transition 1993' refers to the eight months ended
December 31, 1993.
 
     The  condensed consolidated  financial statements for  the six-month period
ended October  31,  1992  have  been  retroactively  restated  for  discontinued
operations,  as  described in  Note 12,  and the  cumulative effect  of adopting
Statement of Financial  Accounting Standards ('SFAS')  No. 109, 'Accounting  for
Income  Taxes'  (which resulted  in a  charge of  $4,852,000, net  of applicable
minority interests) and SFAS No. 106, 'Employers' Accounting for  Postretirement
Benefits  Other Than Pensions' (which resulted in a charge of $1,536,000, net of
applicable income  taxes  and minority  interests)  effective May  1,  1992.  In
addition,   certain  other  amounts  included  in  the  prior  period  condensed
consolidated financial statements  have been  reclassified to  conform with  the
current period presentation.
 
(2) SIGNIFICANT CHARGES IN TRANSITION 1993
 
     The  accompanying condensed  consolidated statement  of operations  for the
six-month period  ended  October 31,  1993  includes the  following  significant
charges (in thousands):
 
<TABLE>
<S>                                                                                                 <C>
Increased reserves for Triarc Companies and third party insurance and reinsurance losses.....   $10,006(a)
Increased reserve for advertising allowances to independent bottlers and coupon redemption...     7,772(b)
Provision for legal matters..................................................................     2,300(c)
                                                                                                -------
     Total charges included in 'Selling, general and administrative expenses'................    20,078
Income tax benefit relating to the above charges.............................................    (3,836)
Minority interest effect of above charges....................................................      (230)
Increased reserve for income tax contingencies...............................................     6,000(d)
Increased estimated loss on disposal of discontinued operations..............................     7,397(e)
                                                                                                -------
                                                                                                $29,409
                                                                                                -------
                                                                                                -------
</TABLE>
 
                                                        (footnotes on next page)
 
                                      F-38
 
<PAGE>
                    TRIARC COMPANIES, INC. AND SUBSIDIARIES
      NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
                                OCTOBER 31, 1993
                                  (UNAUDITED)
 
(footnotes from previous page)
 
 (a) Triarc  Companies increased  the reserves  at Chesapeake  Insurance Company
     Limited ('Chesapeake Insurance'), which is a wholly-owned subsidiary of CFC
     Holdings Corp. ('CFC Holdings'), a 94.6%  owned subsidiary of Triarc and  a
     98.4%  owned subsidiary of Triarc Companies, relating to both insurance and
     reinsurance  coverage  previously  extended  to  subsidiaries  and   former
     affiliates,   as  well  as  reinsurance  coverage  previously  extended  to
     non-affiliated third parties. This increase in the insurance loss  reserves
     at  Chesapeake Insurance effectively wrote  Triarc Companies' investment in
     Chesapeake Insurance  down to  zero. Accordingly,  the ultimate  amount  of
     losses  realized in respect of insurance and reinsurance previously written
     by Chesapeake Insurance will not have  a material adverse effect on  Triarc
     Companies' consolidated results of operations or financial condition.
 
 (b) Triarc Companies provides to certain of its independent soft drink bottlers
     advertising  and promotional  allowances, the  amount of  which are usually
     dependent principally  upon  achievement  of annual  sales  volume.  Triarc
     Companies  provided  an  increase of  $7,772,000  for the  costs  to Triarc
     Companies  of  such   advertising  and  promotional   allowances  to   such
     independent bottlers, principally recorded earlier in Transition 1993.
 
 (c) Triarc  Companies increased its  reserves for legal  matters by $2,300,000,
     principally for a recently asserted claim by NVF Company ('NVF'), a  former
     affiliate (see Note 11).
 
 (d) Triarc  Companies increased  its reserves  for income  tax contingencies by
     $6,000,000 including provisions relating to certain issues being  addressed
     as  part of the examination of Triarc  Companies' income tax returns by the
     Internal Revenue Service  for the tax  years from 1989  through 1992  which
     commenced during the three months ended October 31, 1993.
 
 (e) As set forth in Note 12, Southeastern Public Service Company, a 71.1% owned
     subsidiary  of Triarc  ('SEPSCO'), completed  the sale  of its  utility and
     municipal services business segment in October 1993 and, in November  1993,
     signed  a letter of intent to sell  the ice operations of its refrigeration
     business segment. Assuming  consummation of  the intended sale  of the  ice
     operations,  the only remaining discontinued  operation is the cold storage
     operation of SEPSCO's  refrigeration business segment.  In connection  with
     the  dispositions referred to above,  SEPSCO reevaluated the estimated gain
     or loss from the  sale of its discontinued  operations and Triarc  provided
     $10,400,000   ($7,397,000  net  of  minority  interests)  for  the  revised
     estimated loss on the sale of the discontinued operations from an estimated
     break-even position as of July  31, 1993. The revised estimate  principally
     reflects  (i)  $2,700,000  of  losses  from  the  sales  of  the operations
     comprising the utility and  municipal services business segment  previously
     estimated  to be approximately  break-even; (ii) $6,600,000  of losses from
     the sale of operations  comprising SEPSCO's refrigeration business  segment
     previously  estimated to  be a gain  of $1,600,000 and  (iii) $1,000,000 of
     estimated losses  from operations  from  July 22,  1993  to the  actual  or
     estimated   disposal  dates  of   the  discontinued  operations  previously
     estimated to breakeven due  to the previous  reporting of SEPSCO's  natural
     gas  and oil business  segment as a  discontinued operation less previously
     estimated losses of $1,500,000  from the sale of  SEPSCO's natural gas  and
     oil  business  segment. The  net  loss from  the  sale of  the  utility and
     municipal services business segment reflects  a reduction of $1,800,000  in
     the  estimated  sales price  for the  construction related  operations from
     previous estimates and other adjustments in finalizing the loss on the sale
     of the tree maintenance services operations. The $8,200,000 change relating
     to the sale of the refrigeration business segment principally results  from
     (i)  a $4,000,000 reduction in the sales price for the ice operations based
     on the letter of  intent and (ii) a  $4,000,000 reduction in the  estimated
     sales  price  of the  cold storage  operations  based on  preliminary sales
     discussions and  experience with  respect to  negotiating the  sale of  the
     other operations.
 
                                      F-39
 
<PAGE>
                    TRIARC COMPANIES, INC. AND SUBSIDIARIES
      NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
                                OCTOBER 31, 1993
                                  (UNAUDITED)
 
(3) INVENTORIES
 
     The following is a summary of the components of inventories:
 
<TABLE>
<CAPTION>
                                                                        APRIL 30,    OCTOBER 31,
                                                                          1993          1993
                                                                        ---------    -----------
                                                                             (IN THOUSANDS)
<S>                                                                     <C>          <C>
Raw materials........................................................   $  24,655     $  24,971
Work in process......................................................       6,244         6,445
Finished goods.......................................................      67,371        83,245
                                                                        ---------    -----------
                                                                        $  98,270     $ 114,661
                                                                        ---------    -----------
                                                                        ---------    -----------
</TABLE>
 
(4) PROPERTIES
 
     The following is a summary of the components of properties, net:
 
<TABLE>
<CAPTION>
                                                                        APRIL 30,    OCTOBER 31,
                                                                          1993          1993
                                                                        ---------    -----------
                                                                             (IN THOUSANDS)
<S>                                                                     <C>          <C>
Properties, at cost..................................................   $ 430,743     $ 439,377
Less accumulated depreciation........................................     192,890       196,914
                                                                        ---------    -----------
                                                                        $ 237,853     $ 242,463
                                                                        ---------    -----------
                                                                        ---------    -----------
</TABLE>
 
(5) LONG-TERM DEBT
 
     On  August 12, 1993, the $225,000,000  aggregate principal amount of senior
secured step-up  rate  notes  (the 'Step-Up  Notes')  of  RC/Arby's  Corporation
('RC/Arby's',  formerly  known  as  Royal  Crown  Corporation),  a  wholly-owned
subsidiary of  CFC Holdings,  were refinanced  by the  issuance of  $275,000,000
aggregate  principal  amount of  fixed rate  senior secured  notes (the  '9 3/4%
Senior Notes')  pursuant to  a public  offering. The  9 3/4%  Senior Notes  bear
interest  at 9 3/4% and will mature in 2000. The 9 3/4% Senior Notes are secured
by the stock of RC/Arby's' subsidiaries,  Royal Crown Company, Inc. ('RC  Cola',
formerly  known as Royal Crown  Cola Co., Inc.) and  Arby's, Inc. ('Arby's'). In
addition, all the  stock of  RC/Arby's has been  pledged as  collateral for  the
9  3/4% Senior Notes, and amounts  due thereunder are unconditionally guaranteed
by RC Cola and  Arby's. The guaranties of  RC Cola and Arby's  are secured by  a
first  priority  lien  and  security  interest  in  substantially  all  of their
receivables, inventories and other personal properties. The 9 3/4% Senior  Notes
are  redeemable at the option of RC/Arby's  at amounts commencing at 102.786% of
principal commencing  August 1998  decreasing  to 101.393%  in August  1999.  In
addition,  should  RC/Arby's  consummate  an  initial  public  equity  offering,
RC/Arby's may redeem up to $91,667,000 of the 9 3/4% Senior Notes at 110% of the
principal amount with the net proceeds of such public offering.
 
     On September 24,  1993 RC/Arby's  entered into a  three-year interest  rate
swap  agreement  in  a notional  amount  of $137,500,000.  Under  the agreement,
interest on the notional amount is paid by RC/Arby's at a floating rate which is
based on  the 180-day  London  Interbank Offered  Rate  (set at  3.375%  through
February  1, 1994)  and RC/Arby's  receives interest at  a fixed  rate of 4.72%.
Subsequent to February 1, 1994 the floating rate will be retroactively reset  at
the  end  of each  six-month calculation  period  through July  31, 1996  and on
September 24, 1996. The transaction effectively changes RC/Arby's interest  rate
on  $137,500,000 of  its debt  from a fixed-rate  to a  floating-rate basis. The
differential to be paid or received  will be amortized to interest expense  over
the three-year life of the agreement. The agreement has been entered into with a
major  financial institution which,  therefore, is expected to  be able to fully
perform under the terms of the agreement, thereby mitigating any credit risk  of
the transaction.
 
                                      F-40
 
<PAGE>
                    TRIARC COMPANIES, INC. AND SUBSIDIARIES
      NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
                                OCTOBER 31, 1993
                                  (UNAUDITED)
 
     Triarc  Companies' debt  agreements contain various  covenants which, among
other items, restrict the payment of dividends or loans or advances by  Triarc's
principal  subsidiaries  to  Triarc. As  of  October 31,  1993  National Propane
Corporation, a  wholly-owned  subsidiary  of Triarc  ('National  Propane'),  and
SEPSCO  have approximately  $14,300,000 and  $4,100,000, respectively, available
under their respective debt agreements for  the payment of dividends to  Triarc.
Graniteville Company, a 51% owned subsidiary of Triarc and 85.8% owned by Triarc
Companies  ('Graniteville'), is not permitted to  pay any such dividends or make
any such  loans  or  advances prior  to  April  30, 1996.  While  there  are  no
restrictions  applicable to CFC  Holdings, CFC Holdings  would be dependent upon
cash flows  from  RC/Arby's  to pay  dividends  and,  as of  October  31,  1993,
RC/Arby's  was unable to pay any dividends or  make any loans or advances to CFC
Holdings under the indenture governing the 9 3/4% Senior Notes.
 
(6) EXTRAORDINARY ITEM
 
     In connection with the  early extinguishment of the  Step-Up Notes and  the
retirement  of RC/Arby's'  16 1/4% senior  subordinated debentures  due 1996 and
16  7/8%  subordinated  debentures   due  1996  (collectively,  the   'RC/Arby's
Debentures') previously reacquired, Triarc Companies recognized an extraordinary
charge  during the three months ended October 31, 1993 aggregating $448,000, net
of $241,000  of  income  tax  benefit. Such  pre-tax  charge  consisted  of  the
write-off  of unamortized deferred financing costs  of $1,632,000 on the Step-Up
Notes and $582,000 on the RC/Arby's Debentures partially offset by $1,525,000 of
discount resulting from the redemption of the Step-Up Notes.
 
(7) STOCKHOLDERS' EQUITY (DEFICIT)
 
     During the six months ended October 31, 1993, Triarc granted 171,500 shares
of restricted stock  to certain  members of  the Special  Committee of  Triarc's
Board  of Directors and  key employees under Triarc's  Amended and Restated 1993
Equity Participation Plan.  In connection therewith,  Triarc Companies  recorded
charges of $3,983,000 to unearned compensation included in 'Stockholders' equity
(deficit) -- Other'. Such amount is being amortized as compensation expense over
the applicable vesting period through December 31, 1996. In addition, during the
six  months ended  October 31,  1993, 301,000  non-qualified stock  options were
granted at  prices ranging  from $20.00  to  $30.75 per  share. Of  the  301,000
nonqualified stock options granted during the six months ended October 31, 1993,
275,000  were issued  at $20.00 per  share which  was below the  market price of
$31.75 on the date  of grant resulting in  deferred compensation of  $3,200,000.
Such amount is being accrued as compensation expense over the applicable vesting
period through September 28, 1998.
 
(8) LOSS PER SHARE
 
     The loss per share has been computed by dividing the net loss plus dividend
requirements on Triarc Companies' preferred stock by the weighted average number
of outstanding shares of common stock (25,893,000 shares in the six months ended
October  31, 1992  and 21,239,000  in the  six months  ended October  31, 1993).
Common stock equivalents  were not used  to compute the  loss per share  because
such  inclusion would have  been antidilutive. Fully diluted  loss per share was
not applicable for all  periods presented since  contingent issuances of  common
shares would have been antidilutive.
 
(9) INCOME TAXES
 
     Triarc  Companies recorded a  provision for income  taxes of $6,354,000 for
the six  months ended  October 31,  1993 despite  a pretax  loss of  $12,927,000
principally   due  to  a   $6,000,000  increase  in   reserves  for  income  tax
contingencies (see Note  2), losses  of certain  subsidiaries for  which no  tax
benefit  is available, amortization of costs in excess of net assets of acquired
companies which is not  deductible for income tax  purposes and the increase  in
deferred income taxes resulting from the increase in the Federal income tax rate
from 34% to 35%.
 
                                      F-41
 
<PAGE>
                    TRIARC COMPANIES, INC. AND SUBSIDIARIES
      NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
                                OCTOBER 31, 1993
                                  (UNAUDITED)
 
(10) TRANSACTIONS WITH RELATED PARTIES
 
     During  the six months ended October  31, 1993, Triarc Companies engaged in
the following  transactions with  certain entities  which may  be deemed  to  be
controlled  by  Victor  Posner  (Triarc  Companies'  former  Chairman  and Chief
Executive Officer and present beneficial owner of Triarc Companies'  outstanding
redeemable  convertible preferred stock)  and to have  been affiliates of Triarc
Companies until the  Change in Control  of Triarc Companies  in April 1993  (the
'Change in Control'):
 
          (a)  During the  six months ended  October 31,  1993, Triarc Companies
     sold a  yacht  and  certain  other  assets  having  a  net  book  value  of
     approximately  $400,000 to an entity owned  by Victor Posner for cash sales
     prices aggregating approximately $310,000.
 
          (b)  Triarc  Companies  was  obligated  to  provide  certain   limited
     management  services  to several  former non-subsidiary  affiliates through
     October 23, 1993 and discontinued such services thereafter. Charges to such
     former affiliates  for such  services,  including certain  reinsurance  and
     equipment  lease billings, aggregated approximately $166,000 during the six
     months ended October 31, 1993.
 
          (c) Triarc  Companies  leases  approximately 297,000  square  feet  of
     office  space from a trust created for the benefit of Victor Posner and his
     children  to  which  Triarc  Companies  made  aggregate  rent  payments  of
     $2,172,000  during the  six months ended  October 31, 1993  which have been
     charged to 'Selling,  general and administrative  expenses'. In July  1993,
     Triarc Companies gave notice of termination of such lease effective January
     31,   1994.  Triarc  Companies  had   accrued  a  charge  of  approximately
     $13,000,000 in the  three months ended  April 30, 1993  to provide for  the
     remaining  payments on the  lease subsequent to  its cancellation, which is
     included in  'Accrued  facilities relocation  and  corporate  restructuring
     costs.'
 
     On  October  1, 1993  Triarc Companies  began leasing  two airplanes  and a
helicopter from  Triangle Aircraft  Services  Corporation ('TASCO'),  a  company
owned by Nelson Peltz (Chairman and Chief Executive Officer of Triarc Companies)
and  Peter W. May  (President and Chief Operating  Officer of Triarc Companies),
for an aggregate annual rent of $2,200,000. In connection with such lease Triarc
Companies had  rent expense  for  October 1993  of  $183,000. Pursuant  to  this
arrangement,  Triarc Companies also pays the  operating expenses of the aircraft
directly to third parties. Prior to October 1, 1993, Triarc Companies also  made
use  of these aircraft pursuant to a prior agreement and paid TASCO for such use
at a rate equal  to TASCO's direct out-of-pocket  expenses, excluding fuel,  oil
and  lubricants, plus  two times  the cost of  fuel, oil  and lubricants. Triarc
Companies was charged  $681,000 by TASCO  in respect of  usage under this  prior
agreement during the six months ended October 31, 1993.
 
     Triarc  Companies also subleases  from affiliates of  Messrs. Peltz and May
(the 'Sub-landlords') approximately 26,800 square feet of furnished office space
in New York, New York and,  until October 26, 1993, approximately 32,000  square
feet  of  office  space  in  West  Palm  Beach,  Florida  owned  by unaffiliated
landlords. Subsequent to October  26, 1993, Triarc  Companies assumed the  lease
for approximately 17,000 square feet of the office space in West Palm Beach. The
aggregate  amount  paid  by Triarc  Companies  with respect  to  such subleases,
including operating expenses, was approximately $1,258,000 during the six months
ended  October  31,  1993,  which  is   less  than  the  aggregate  amount   the
Sub-landlords  paid to  the unaffiliated landlords.  Messrs. Peltz  and May have
guaranteed to the unaffiliated  landlords the payment of  rent for the New  York
and West Palm Beach office space.
 
     An affiliate of Messrs. Peltz and May leases an apartment in New York City.
Commencing  June  1,  1993, such  apartment  was  used by  executives  of Triarc
Companies  and,  in  connection  therewith,  Triarc  Companies  reimbursed  such
affiliate  for $138,000  of rent  for the  apartment for  the five  months ended
October 31, 1993.
 
(11) CONTINGENCIES
 
     In December  1990, a  purported shareholder  derivative suit  (the  'Ehrman
Litigation')  was brought  against SEPSCO's directors  at that  time and certain
corporations, including  Triarc, in  the United  States District  Court for  the
Southern District of Florida (the 'District Court'). On October 18, 1993, Triarc
 
                                      F-42
 
<PAGE>
                    TRIARC COMPANIES, INC. AND SUBSIDIARIES
      NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
                                OCTOBER 31, 1993
                                  (UNAUDITED)
 
entered  into  a  settlement  agreement (the  'Settlement  Agreement')  with the
plaintiff (the 'Plaintiff') in the  Ehrman Litigation. The Settlement  Agreement
provides,  among other  things, that SEPSCO  would be merged  into, or otherwise
acquired by, Triarc  or an  affiliate thereof, in  a transaction  in which  each
holder of shares of SEPSCO's common stock par value $1.00 per share (the 'SEPSCO
Common  Stock') other  than Triarc Companies  will receive in  exchange for each
share of SEPSCO Common Stock,  0.8 shares of Triarc's  Class A common stock  par
value  $.10  per  share (the  'Triarc  Class  A Common  Stock').  The Settlement
Agreement also provides that Plaintiff's  counsel and financial advisor will  be
paid,  subject to  court approval,  cash not  to exceed  $1,250,000 and $50,000,
respectively. Triarc Companies  accrued such  costs together  with $400,000  and
$1,200,000 for legal fees of SEPSCO in the three months ended April 30, 1993 and
the  six  months ended  October 31,  1993, respectively,  and such  accruals are
included  in  'Other   current  liabilities'  in   the  accompanying   condensed
consolidated  balance  sheets as  of April  30,  1993 and  October 31,  1993. On
November 22, 1993 Triarc and SEPSCO entered into a merger agreement pursuant  to
which  a subsidiary of Triarc will be merged into SEPSCO in the manner described
in the  Settlement  Agreement  (the  'Merger').  Following  the  Merger,  Triarc
Companies  would  own  100% of  the  SEPSCO  Common Stock.  Consummation  of the
Settlement Agreement  and the  Merger are  conditioned on,  among other  things,
approval by SEPSCO's stockholders other than Triarc Companies. (See Note 13.)
 
     Chesapeake  Insurance is registered under the Bermuda Insurance Act of 1978
and  related  regulations  which  require  compliance  with  various  provisions
regarding  the  maintenance  of  statutory  capital  and  liquidity.  Chesapeake
Insurance was not in compliance with the required solvency ratio as of September
30, 1993.  Since Triarc  Companies has  decided that  Chesapeake Insurance  will
cease  writing any new insurance contracts, the non-compliance with the solvency
test will have no effect on Triarc Companies.
 
     In September 1989, the Pennsylvania Insurance Commissioner as rehabilitator
of Mutual Fire, Marine and Inland Insurance Company ('Mutual Fire') commenced an
action in the Commonwealth Court  of Pennsylvania against Chesapeake  Insurance.
Such  action, among other things, seeks recovery of $4,000,000 allegedly owed by
Chesapeake  Insurance  in  connection  with  certain  reinsurance  arrangements,
specific  performance by Chesapeake  Insurance of its  alleged obligations under
certain reinsurance arrangements by requiring Chesapeake Insurance to provide  a
letter of credit in an amount in excess of $12,000,000 to secure certain alleged
outstanding  losses, a restitution  and accounting by  Chesapeake Insurance, and
compensatory and punitive damages in an amount in excess of $40,000,000  arising
out  of alleged bad  faith in connection with  such reinsurance arrangements. In
November 1993 Chesapeake Insurance entered into  a letter of intent with  Mutual
Fire  for  full settlement  of all  claims for  $12,000,000. Such  settlement is
subject to execution  of a  definitive settlement agreement  which agreement  is
subject  to approval of the Commonwealth Court of Pennsylvania. Triarc Companies
has fully provided  for such settlement  in prior years  of which $5,114,000  is
included  in 'Accounts payable'  and $6,886,000 in  'Insurance loss reserves' in
the accompanying condensed consolidated financial statements.
 
     In August 1993, NVF, which was  affiliated with Triarc Companies until  the
Change  in  Control, became  a debtor  in a  case filed  by its  creditors under
Chapter 11 of the Federal Bankruptcy  Code (the 'NVF Proceedings'). In  November
1993,  Triarc Companies  received correspondence  from NVF's  bankruptcy counsel
claiming that, on  the theories  set forth  in such  correspondence, Triarc  and
certain  of its subsidiaries owed NVF approximately $2,300,000. Triarc Companies
intends to  vigorously  contest  such  claims.  Nevertheless,  Triarc  Companies
previously  accrued approximately $875,000 with respect  to claims that might be
made by NVF  and, during the  three months  ended October 31,  1993, accrued  an
additional  $1,425,000  with  respect  to  such  matters  (see  Note  2). Triarc
Companies believes that the  outcome of the  NVF Proceedings, after  considering
the  amounts provided in the current and prior periods, will not have a material
adverse effect on Triarc Companies  consolidated financial condition or  results
of operations.
 
                                      F-43
 
<PAGE>
                    TRIARC COMPANIES, INC. AND SUBSIDIARIES
      NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
                                OCTOBER 31, 1993
                                  (UNAUDITED)
 
     In  1987, Graniteville  was notified  by the  South Carolina  Department of
Health  and   Environmental  Control   ('DHEC')  that   it  discovered   certain
contamination  of  Langley  Pond  near  Graniteville,  South  Carolina  and DHEC
asserted that  Graniteville may  be  one of  the  parties responsible  for  such
contamination.  Graniteville  entered into  a consent  decree providing  for the
study and investigation  of the  alleged pollution  and its  sources. The  study
report  prepared by Graniteville's environmental  consulting firm and filed with
DHEC in April 1990, recommended that  pond sediments be left undisturbed and  in
place.   DHEC  responded  by  requesting  that  Graniteville  submit  additional
information concerning potential passive and active remedial alternatives,  with
accompanying  supportive  information. In  May  1991 Graniteville  provided this
information to DHEC in a report of Graniteville's environmental consulting firm.
The 1990  and  1991  reports  concluded  that  pond  sediments  should  be  left
undisturbed  and in place  and that other  less passive remediation alternatives
either provided  no  significant  additional  benefits  or  themselves  involved
adverse  effects  on  human health,  to  existing  recreational uses  or  to the
existing biological communities. Triarc is unable  to predict at this time  what
further actions, if any, may be required in connection with Langley Pond or what
the cost thereof may be. However, given the passage of time since the submission
of  the two reports by Graniteville's  environmental consulting firm without any
objection or  adverse  comment  on such  reports  by  DHEC and  the  absence  of
desirable  remediation alternatives, other than  continuing to leave the Langley
Pond sediments in  place and  undisturbed as  described in  the reports,  Triarc
believes  the ultimate outcome of  this matter will not  have a material adverse
effect on Triarc consolidated results of operations or financial position.
 
     As a result of certain environmental audits in 1991, SEPSCO became aware of
possible contamination by hydrocarbons and  metals at certain sites of  SEPSCO's
refrigeration  operations  and has  filed  appropriate notifications  with state
environmental authorities and has  begun a study of  remediation at such  sites.
SEPSCO  has  removed  certain underground  storage  and other  tanks  at certain
facilities  of  its  refrigeration  operations   and  has  engaged  in   certain
remediation  in connection therewith. Such removal and environmental remediation
involved a  variety  of remediation  actions  at various  facilities  of  SEPSCO
located in a number of jurisdictions. Such remediation varied from site to site,
ranging  from testing of soil and  groundwater for contamination, development of
remediation plans  and  removal in  certain  instances of  certain  contaminated
soils.  Based  on preliminary  information and  consultations with,  and certain
reports of, environmental consultants and others, SEPSCO presently estimates the
cost of  such remediation  and/or removal  will approximate  $3,700,000, all  of
which  was provided in prior years. In connection therewith, SEPSCO has incurred
actual costs through October 31, 1993 of $1,000,000 and has a remaining  accrual
of  $2,700,000. Triarc believes that after  such accrual the ultimate outcome of
this matter  will  not have  a  material  adverse effect  on  Triarc  Companies'
consolidated results of operations or financial position.
 
     In  1991, Triarc Companies became aware  that lead and cadmium contaminants
are present at a site owned by a non-core subsidiary at which the subsidiary had
disposed of decorative glass products  produced prior to 1980. The  Pennsylvania
Department of Environmental Regulation ('PDER') has been informed of this matter
and  such subsidiary expects to  develop, with the PDER,  a plan of remediation.
The remediation actions being considered include capping the materials in  place
or  removing  the materials  to an  approved landfill.  Triarc Companies  has no
reason to believe  that any  of the decorative  glass products  produced by  its
subsidiary  exceeded or were in any  way inconsistent with applicable standards,
including health  and safety  standards,  for consumer  use of  glass  products.
Triarc  Companies recorded charges to operations  of $900,000 in Fiscal 1993 for
the estimated costs of the anticipated plan of remediation. Triarc believes that
after such  provision  the ultimate  outcome  of this  matter  will not  have  a
material  adverse effect on Triarc Companies' consolidated results of operations
or financial position.
 
     In addition to the matters described above Triarc Companies is involved  in
claims,  litigation and administrative proceedings and investigations of various
types in several jurisdictions. Such matters arise
 
                                      F-44
 
<PAGE>
                    TRIARC COMPANIES, INC. AND SUBSIDIARIES
      NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
                                OCTOBER 31, 1993
                                  (UNAUDITED)
 
in the ordinary course of the business of Triarc Companies and it is the opinion
of management that the outcome of any such matter, or all of them combined, will
not have a material adverse effect on Triarc Companies' consolidated results  of
operations or financial position.
 
(12) DISCONTINUED OPERATIONS
 
     On  July  22,  1993 SEPSCO's  Board  of  Directors authorized  the  sale or
liquidation of  SEPSCO's  utility  and  municipal  services,  refrigeration  and
natural  gas and oil businesses. On December 9, 1993 SEPSCO's Board of Directors
decided the natural gas  and oil business will  be transferred to Triarc  rather
than  SEPSCO selling it to an independent  third party. Such transfer will be in
the form of a sale of the stock  of the entities comprising the natural gas  and
oil  business for  cash of  $8,500,000 which  is equal  to their  fair value and
approximately $4,500,000 higher than  their net book value.  It is intended  for
this  sale to occur  following the Merger  and the resulting  elimination of the
minority interest  in  SEPSCO (Note  11).  However,  should the  Merger  not  be
approved  by the  SEPSCO stockholders  (Note 11)  the sale  of the  stock of the
natural gas and oil entities for cash to Triarc will be completed prior to  July
22,  1994. Accordingly, the net assets of  the natural gas and oil business have
been reclassified from the  net current and  non-current assets of  discontinued
operations  to 'Other Assets' in the accompanying condensed consolidated balance
sheet  as  of  October  31,  1993.  The  condensed  consolidated  statements  of
operations  have  not been  restated  since the  results  of operations  of such
business segment for  the six months  ended October  31, 1992 and  1993 are  not
material.  SEPSCO's  utility and  municipal  services business  segment  and its
refrigeration  business  segment  have   been  accounted  for  as   discontinued
operations in Triarc Companies' condensed consolidated financial statements.
 
     On October 15, 1993 SEPSCO sold the assets of its tree maintenance services
operations  previously included in  its utility and  municipal services business
segment for $69,600,000 in cash  plus the assumption by  the purchaser of up  to
$5,000,000  in current liabilities resulting in a loss of $4,771,000. On October
7, 1993  SEPSCO  sold the  stock  of  its two  construction  related  operations
previously included in its utility and municipal services business segment for a
nominal amount subject to adjustments described below. As the related assets are
sold  or  liquidated the  purchasers have  agreed to  pay, as  deferred purchase
price, 75% of the net proceeds  received therefrom (cash of $1,091,000 had  been
received  as of October  31, 1993) plus,  in the case  of the larger  of the two
entities, an amount equal to 1.25 times  the adjusted book value of such  entity
as  of October 5,  1995. As of October  7, 1993, the adjusted  book value of the
assets of that entity aggregated  approximately $1,600,000. In addition,  Triarc
Companies  paid  $2,000,000 during  October 1993  to cover  short-term operating
losses and working capital requirements for the construction related operations.
Triarc Companies'  current estimate  of the  sales of  the construction  related
operations  is a gain of $2,030,000 excluding any consideration of the potential
book value adjustment.
 
     On November 12, 1993 SEPSCO signed a letter of intent to sell substantially
all of the operating assets of the ice operations of its refrigeration  business
segment  for $5,000,000 in cash, a $4,000,000 note (discounted value $3,101,000)
and the assumption by the buyer of certain current liabilities of  approximately
$1,000,000.  The  note which  bears no  interest  during the  first year  and 5%
thereafter, would be payable in installments of  $120,000 at the end of each  of
the  four years following the closing date with the balance of $3,520,000 due at
the end of the fifth year following the closing date. The precise timetable  for
the  sale  and liquidation  of the  remaining  discontinued operation,  the cold
storage operations of SEPSCO's refrigeration business segment, will depend  upon
SEPSCO's  ability to identify appropriate  potential purchasers and to negotiate
acceptable terms for the  sale of such  operation. SEPSCO currently  anticipates
completion of such sales by July 31, 1994.
 
     Based on the analysis performed to date, after taking into account both the
charge  taken  in  Fiscal 1993  and  the  charge to  discontinued  operations of
$10,400,000 (before minority interests of $3,003,000) taken in the three  months
ended  October  31,  1993  (see  Note  2),  Triarc  Companies  expects  that all
 
                                      F-45
 
<PAGE>
                    TRIARC COMPANIES, INC. AND SUBSIDIARIES
      NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
                                OCTOBER 31, 1993
                                  (UNAUDITED)
 
currently anticipated dispositions,  including the results  of their  operations
through  the actual  or anticipated  disposal dates,  will not  in the aggregate
result in any additional loss to Triarc Companies.
 
     Net current and non-current assets  of the discontinued operations  consist
of the following:
 
<TABLE>
<CAPTION>
                                                                                  APRIL 30,    OCTOBER 31,
                                                                                    1993          1993
                                                                                  ---------    -----------
                                                                                       (IN THOUSANDS)
<S>                                                                               <C>          <C>
Net assets of operations sold for cash, net of loss on disposal................   $  --          $33,768
Receivables, net...............................................................      25,178        2,506
Inventories....................................................................       2,845          626
Current portion of long-term debt..............................................      (9,709)        (256)
Other current assets and liabilities, net......................................     (11,491)      (3,582)
                                                                                  ---------    -----------
Net current assets of discontinued operations..................................   $   6,823      $33,062
                                                                                  ---------    -----------
                                                                                  ---------    -----------
Properties, net................................................................   $  85,880      $20,884
Long-term debt.................................................................     (16,992)        (287)
Deferred income taxes..........................................................      (8,477)      (2,061)
Other assets and liabilities, net..............................................        (325)      (2,714)
                                                                                  ---------    -----------
Net non-current assets of discontinued operations..............................   $  60,086      $15,822
                                                                                  ---------    -----------
                                                                                  ---------    -----------
</TABLE>
 
     The  income  (loss)  from  discontinued operations  through  July  22, 1993
consisted of the following:
 
<TABLE>
<CAPTION>
                                                                                        SIX MONTHS
                                                                                           ENDED
                                                                                        OCTOBER 31,
                                                                                    -------------------
                                                                                      1992       1993
                                                                                    --------    -------
                                                                                      (IN THOUSANDS)
<S>                                                                                 <C>         <C>
Results of Operations
     Revenues....................................................................   $103,628    $83,462
     Operating profit............................................................      6,403      2,298
     Income before income taxes and minority interests...........................      4,989      1,242
     Provision for income taxes..................................................     (1,885)      (920)
     Minority interests..........................................................     (1,088)       (93)
     Net income..................................................................      2,016        229
</TABLE>
 
13. SUBSEQUENT EVENTS
 
     Triarc  has  estimated   that  an  aggregate   $5,000,000  of  the   Merger
consideration  represents  settlement costs  of the  Ehrman Litigation.  Of such
amount, $1,250,000 represents plaintiff's counsel fees which has been previously
accrued. The remaining  $3,750,000 will be  recorded as a  charge to  operations
during  the two months ended  December 31, 1993 since  it was during such period
that Triarc determined that the litigation  settlement was more likely than  not
to  be approved by the District Court.  In fact, the District Court approved the
Settlement Agreement for the Ehrman Litigation on January 11, 1994.
 
     In March 1994, Chesapeake Insurance entered into an agreement for the  full
commutation  of all insurance  previously underwritten by  its insurance carrier
for the years 1977-1993, on behalf of the Triarc Companies and former affiliated
companies  which  had  been  reinsured  by  Chesapeake  Insurance  (representing
approximately  $63,500,000  of  Triarc Companies  insurance  loss  reserves). In
connection  with   such  commutation,   Triarc  Companies   paid  an   aggregate
consideration   of  approximately   $63,500,000,  consisting   of  approximately
$29,300,000  of  restricted  cash   and  short-term  investments  of   insurance
operations,  and a promissory note  of Triarc bearing interest  at 9 3/4% in the
principal amount of $34,200,000.
 
     In February  1994, the  official committee  of unsecured  creditors of  APL
Corporation  (the  'APL  Committee')  filed a  complaint  (the  'APL Complaint')
against certain Posner Entities, Triarc and
 
                                      F-46
 
<PAGE>
                    TRIARC COMPANIES, INC. AND SUBSIDIARIES
      NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
                                OCTOBER 31, 1993
                                  (UNAUDITED)
 
certain companies formerly or presently  affiliated with Posner or with  Triarc,
alleging  causes of action arising from various transactions allegedly caused by
the named  Posner  Entities in  breach  of their  fiduciary  duties to  APL  and
resulting  in corporate waste, fraudulent transfers  and preferences. In the APL
Complaint, the APL Committee  asserts claims against Triarc  for (a) aiding  and
abetting  breach of fiduciary duty, (b)  equitable subordination of claims which
Triarc may have against APL,  (c) declaratory relief as  to whether APL has  any
liability  to Triarc, and (d) recovery of fraudulent transfers allegedly made by
APL to Triarc  prior to commencement  of the APL  proceeding. The APL  Complaint
seeks an undetermined amount of damages from Triarc, as well as the other relief
identified in the preceding sentence. Because the APL Complaint was filed in the
last  week of February,  Triarc Management has  not had an  opportunity to fully
investigate  the  matters  contained  therein.  However,  based  on  information
currently  available,  Triarc  does not  believe  that  the outcome  of  the APL
Complaint will have  a material  adverse effect  on the  financial condition  or
results of operations of the Triarc Companies.
 
                                      F-47

<PAGE>
               REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
 
To the Board of Directors and Stockholders,
  SOUTHEASTERN PUBLIC SERVICE COMPANY:
 
     We   have  audited   the  accompanying   consolidated  balance   sheets  of
Southeastern Public  Service Company  (a Delaware  corporation and  presently  a
71.1%  owned subsidiary of Triarc Companies  Inc., formerly DWG Corporation) and
subsidiaries as of  February 29,  1992 and February  28, 1993,  and the  related
consolidated   statements  of  operations  and  retained  earnings  (accumulated
deficit) and cash flows for each of the three years in the period ended February
28, 1993. These  financial statements  are the responsibility  of the  Company's
management.  Our  responsibility is  to express  an  opinion on  these financial
statements based on our audits.
 
     We conducted  our audits  in accordance  with generally  accepted  auditing
standards.  Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence  supporting
the  amounts and disclosures in the financial statements. An audit also includes
assessing the  accounting  principles used  and  significant estimates  made  by
management,  as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
 
     In our opinion, the financial statements referred to above present  fairly,
in  all material respects, the financial position of Southeastern Public Service
Company and subsidiaries as of February 29, 1992 and February 28, 1993, and  the
results  of their operations and their cash flows for each of the three years in
the period  ended  February 28,  1993,  in conformity  with  generally  accepted
accounting principles.
 
     As  discussed in Note 7,  effective March 2, 1992,  the Company's 49% owned
affiliate accounted for under the equity method changed its method of accounting
for income taxes and postretirement benefits other than pensions.
 
                                          ARTHUR ANDERSEN & CO.
 
Miami, Florida,
  July 22, 1993 (except with respect to certain
  matters discussed in Notes 2 and 15, as to
  which the date is September 1, 1993).
 
                                      F-48

<PAGE>
              SOUTHEASTERN PUBLIC SERVICE COMPANY AND SUBSIDIARIES
                          CONSOLIDATED BALANCE SHEETS
 
<TABLE>
<CAPTION>
                                                                                              FEBRUARY 28 OR 29,
                                                                                             --------------------
                                                                                               1992        1993
                                                                                             --------    --------
                                                                                                (IN THOUSANDS)
<S>                                                                                          <C>         <C>
                                          ASSETS
Current assets:
     Cash.................................................................................   $    282    $    239
     Restricted cash and equivalents (Note 3).............................................      5,264       5,264
     Receivables (less allowance for doubtful accounts of $279 and $269)..................      3,847       3,971
     Finished goods inventories...........................................................      1,025         733
     Notes receivable from Triarc, net (less unamortized deferred discount
       of $39) (Notes 5 and 16)...........................................................      --         25,047
     Other current assets (Note 8)........................................................        905       1,386
     Net current assets of discontinued operations (Note 2)...............................      --          1,987
                                                                                             --------    --------
          Total current assets............................................................     11,323      38,627
Properties, net (Note 6)..................................................................      7,528       7,825
Notes receivable from Triarc (less unamortized deferred discount of $165 at February 29,
  1992) (Notes 5 and 16)..................................................................     55,287      26,538
Investments in affiliates (Notes 7 and 15)................................................     62,905      65,327
Other assets..............................................................................      2,119       1,752
Net non-current assets of discontinued operations (Note 2)................................     69,168      66,184
                                                                                             --------    --------
                                                                                             $208,330    $206,253
                                                                                             --------    --------
                                                                                             --------    --------
                           LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
     Current portion of long-term debt (Notes 9 and 16)...................................   $  9,290    $  9,312
     Notes payable to affiliate (Notes 14 and 17).........................................      5,643      14,043
     Accounts receivable financing (Notes 4 and 17).......................................      8,789       9,536
     Accounts payable.....................................................................      1,674       2,249
     Other accrued expenses...............................................................      3,185       4,624
     Net current liabilities of discontinued operations (Note 2)..........................        180       --
                                                                                             --------    --------
          Total current liabilities.......................................................     28,761      39,764
Long-term debt (less unamortized deferred discount of $6,666 and $5,282) (Notes 9 and
  16).....................................................................................     56,826      49,661
Deferred income taxes (Note 8)............................................................      7,870       7,230
Other liabilities (Note 5)................................................................      7,370       1,368
Commitments and contingencies (Notes 2, 8, 11 and 15)
Stockholders' equity (Note 10):
     Series B, convertible preferred stock, $50 par value; 267,600 shares authorized; 490
      shares issued.......................................................................         24          24
     Common stock, $1 par value; 25,000,000 shares authorized; 11,896,136 shares issued...     11,896      11,896
     Additional paid-in capital...........................................................     90,539      90,539
     Retained earnings....................................................................      5,910       6,637
                                                                                             --------    --------
                                                                                              108,369     109,096
     Less 241,069 common shares in treasury, at cost......................................        866         866
                                                                                             --------    --------
          Total stockholders' equity......................................................    107,503     108,230
                                                                                             --------    --------
                                                                                             $208,330    $206,253
                                                                                             --------    --------
                                                                                             --------    --------
</TABLE>
 
          See accompanying notes to consolidated financial statements.
 
                                      F-49

<PAGE>
              SOUTHEASTERN PUBLIC SERVICE COMPANY AND SUBSIDIARIES
                   CONSOLIDATED STATEMENTS OF OPERATIONS AND
                    RETAINED EARNINGS (ACCUMULATED DEFICIT)
 
<TABLE>
<CAPTION>
                                                                                    YEAR ENDED FEBRUARY 28 OR 29,
                                                                                    -----------------------------
                                                                                     1991       1992       1993
                                                                                    -------    -------    -------
                                                                                    (IN THOUSANDS EXCEPT FOR PER
                                                                                           SHARE AMOUNTS)
<S>                                                                                 <C>        <C>        <C>
Net sales........................................................................   $29,154    $29,220    $28,520
                                                                                    -------    -------    -------
Costs and expenses:
     Cost of sales...............................................................    23,033     22,416     22,604
     Selling, general and administrative expenses................................     2,940      2,233      2,282
                                                                                    -------    -------    -------
                                                                                     25,973     24,649     24,886
                                                                                    -------    -------    -------
          Operating profit.......................................................     3,181      4,571      3,634
                                                                                    -------    -------    -------
Other income (expense):
     Interest expense............................................................   (12,892)   (13,740)   (13,901)
     Equity in earnings of affiliates before cumulative effect of changes in
       accounting principles and extraordinary items of affiliate (Note 7).......     2,683      5,201     12,161
     Interest income from Triarc (Note 5)........................................     7,333      7,336      7,336
     Gain on sale of marketable security (Note 5)................................     --         --         6,000
     Gains on repurchase of debentures for sinking fund (Note 9).................     3,510      3,960        117
     Other, net (Note 15)........................................................     1,831        440     (1,104)
                                                                                    -------    -------    -------
                                                                                      2,465      3,197     10,609
                                                                                    -------    -------    -------
          Income from continuing operations before income taxes, cumulative
            effect of changes in accounting principles and extraordinary items of
            affiliate............................................................     5,646      7,768     14,243
Provision for income taxes (Note 8)..............................................    (1,401)    (1,436)    (1,671)
                                                                                    -------    -------    -------
          Income from continuing operations before cumulative effect of changes
            in accounting principles and extraordinary items of affiliate........     4,245      6,332     12,572
Loss from discontinued operations, net of income taxes (Note 2)..................    (7,899)      (225)    (5,542)
                                                                                    -------    -------    -------
          Income (loss) before equity in cumulative effect of changes in
            accounting principles and extraordinary items of affiliate...........    (3,654)     6,107      7,030
Equity in cumulative effect of changes in accounting principles of affiliate, net
  of income taxes (Note 7).......................................................     --         --        (5,954)
Equity in extraordinary items of affiliate (Note 7)..............................       794      --          (348)
                                                                                    -------    -------    -------
          Net income (loss)......................................................    (2,860)     6,107        728
Retained earnings (accumulated deficit) at beginning of year.....................     2,672       (196)     5,910
     Cash dividends ($2.75 per share):
          Series A Redeemable preferred stock....................................        (7)        (1)        (1)
          Series B Convertible preferred stock...................................        (1)     --         --
                                                                                    -------    -------    -------
Retained earnings (accumulated deficit) at end of year...........................   $  (196)   $ 5,910    $ 6,637
                                                                                    -------    -------    -------
                                                                                    -------    -------    -------
Income (loss) per share (Note 1):
     Continuing operations.......................................................   $   .36    $   .54    $  1.08
     Discontinued operations.....................................................      (.68)      (.02)      (.48)
     Cumulative effect of changes in accounting principles of affiliate..........     --         --          (.51)
     Extraordinary items of affiliate............................................       .07      --          (.03)
                                                                                    -------    -------    -------
     Net income (loss)...........................................................   $  (.25)   $   .52    $   .06
                                                                                    -------    -------    -------
                                                                                    -------    -------    -------
</TABLE>
 
          See accompanying notes to consolidated financial statements.
 
                                      F-50

<PAGE>
              SOUTHEASTERN PUBLIC SERVICE COMPANY AND SUBSIDIARIES
                     CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 (IN THOUSANDS)
 
<TABLE>
<CAPTION>
                                                                                              YEAR ENDED
                                                                                          FEBRUARY 28 OR 29,
                                                                                      ---------------------------
                                                                                       1991      1992      1993
                                                                                      -------   -------   -------

<S>                                                                                   <C>       <C>       <C>
Cash flows from operating activities:
Net income (loss)...................................................................  $(2,860)  $ 6,107   $   728
     Adjustments to reconcile net income (loss) to net cash provided by (used in)
      operating activities:
          Depreciation..............................................................    1,272     1,231     1,246
          Amortization of deferred financing costs and debt discount................    1,837     1,755     1,663
          Amortization of deferred discount on notes receivable from Triarc.........      (93)     (109)     (126)
          Provision for doubtful accounts...........................................      215       209       188
          Gains on purchases of 11 7/8% Senior Subordinated Debentures..............   (3,510)   (3,960)     (117)
          Gain on sale of marketable security.......................................    --        --       (6,000)
          Loss (gain) on sale of properties.........................................   (1,237)      (66)       18
          Dividends from unconsolidated affiliate...................................    4,576     1,038     3,004
          Equity in net earnings of affiliates......................................   (3,211)   (4,792)   (5,014)
          Loss from discontinued operations.........................................    7,899       225     5,542
          Increase (decrease) in deferred income taxes..............................   (3,249)     (952)   (1,051)
          Other.....................................................................      (16)    1,130       (54)
          Changes in operating assets and liabilities:
               Decrease (increase) in receivables...................................     (334)      370      (312)
               Decrease in inventories..............................................      416        74       292
               Decrease in note receivable from Triarc..............................    --        --        3,828
               Decrease (increase) in other current assets..........................       60      (565)     (481)
               Increase (decrease) in accounts payable..............................      114    (1,070)      575
               Increase (decrease) in accrued expenses..............................     (499)      (94)    1,439
                                                                                      -------   -------   -------
                    Net cash provided by operating activities.......................    1,380       531     5,368
                                                                                      -------   -------   -------
Cash flows from investing activities:
     Capital expenditures...........................................................     (538)     (100)     (656)
     Proceeds from sales of properties..............................................    1,321       160        73
     Investment in affiliate........................................................    --       (1,500)    --
                                                                                      -------   -------   -------
                    Net cash provided by (used in) investing activities.............      783    (1,440)     (583)
                                                                                      -------   -------   -------
Cash flows from financing activities:
     Net proceeds from accounts receivable financing................................    5,878     2,911       747
     Repayments of long-term debt...................................................   (6,158)   (5,651)   (9,249)
     Proceeds from note payable to affiliate........................................    --        5,643     8,400
     Other..........................................................................       (7)       (1)       (1)
                                                                                      -------   -------   -------
                    Net cash provided by (used in) financing activities.............     (287)    2,902      (103)
                                                                                      -------   -------   -------
Net cash provided by continuing operations..........................................    1,876     1,993     4,682
Net cash used by discontinued operations............................................   (5,364)   (2,186)   (4,725)
                                                                                      -------   -------   -------
Net decrease in cash................................................................   (3,488)     (193)      (43)
Cash at beginning of year...........................................................    3,963       475       282
                                                                                      -------   -------   -------
Cash at end of year.................................................................  $   475   $   282   $   239
                                                                                      -------   -------   -------
                                                                                      -------   -------   -------
</TABLE>
 
                                                  (table continued on next page)
 
                                      F-51
 
<PAGE>
              SOUTHEASTERN PUBLIC SERVICE COMPANY AND SUBSIDIARIES
              CONSOLIDATED STATEMENTS OF CASH FLOWS -- (CONTINUED)
                                 (IN THOUSANDS)
 
(table continued from previous page)
 
<TABLE>
<CAPTION>
                                                                                              YEAR ENDED
                                                                                          FEBRUARY 28 OR 29,
                                                                                      ---------------------------
                                                                                       1991      1992      1993
                                                                                      -------   -------   -------
<S>                                                                                   <C>       <C>       <C>
Supplemental disclosures of cash flow information:
     Cash paid during the year for:
          Interest..................................................................  $11,035   $11,910   $11,401
                                                                                      -------   -------   -------
                                                                                      -------   -------   -------
          Income taxes..............................................................  $ 4,178   $ 1,050   $ 2,204
                                                                                      -------   -------   -------
                                                                                      -------   -------   -------
</TABLE>
 
- ------------
 
     Other:
 
            During  the years  ended February  28, 1991,  February 29,  1992 and
            February 28, 1993, Southeastern Public Service Company ('SEPSCO')  a
            71.1% owned subsidiary of Triarc Companies, Inc. ('Triarc', formerly
            DWG  Corporation), received interest payments from Triarc of $5,600,
            $7,209 and  $6,026, respectively,  in the  form of  offsets  against
            amounts  due  from SEPSCO  to Triarc.  In  1993, amounts  payable to
            Triarc were netted against a $6,500 promissory note receivable  from
            Triarc (see Note 5).
 
            The  reduction in the SEPSCO's ownership of CFC Holdings Corp. ('CFC
            Holdings') in  July 1991  described  in Note  7 resulted  in  SEPSCO
            reclassifying,  in the year ended  February 29, 1992, to 'Additional
            paid-in capital' the cumulative equity in net losses of CFC Holdings
            amounting  to  $15,210  which  was  previously  recorded  in  'Other
            liabilities'.
 
          See accompanying notes to consolidated financial statements.
 
                                      F-52

<PAGE>
              SOUTHEASTERN PUBLIC SERVICE COMPANY AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 
(1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
 
PRINCIPLES OF CONSOLIDATION
 
     The  consolidated financial statements include the accounts of Southeastern
Public Service Company ('SEPSCO') a  71.1% owned subsidiary of Triarc  Companies
Inc.  ('Triarc', formerly DWG  Corporation), and its  subsidiaries. Due to their
planned sale  or liquidation  (see  Note 2),  all  subsidiaries except  for  the
liquefied petroleum gas business have been reflected as discontinued operations.
All  significant intercompany balances and  transactions have been eliminated in
consolidation. SEPSCO's consolidated financial statements for each of the  years
in  the years ended February 28, 1991  ('SEPSCO Fiscal 1991'), February 29, 1992
('SEPSCO Fiscal 1992') and February 28, 1993 ('SEPSCO Fiscal 1993') include  the
results  of Graniteville Company  ('Graniteville') as a  49% owned affiliate and
CFC Holdings Corp. ('CFC Holdings') as a 48% owned affiliate prior to July 1991,
5.4% owned since  such date. Both  investments are accounted  for on the  equity
method.  SEPSCO's  year ends  on the  last day  of February  and as  used herein
February 28 shall mean the last day of SEPSCO's fiscal year.
 
CASH AND EQUIVALENTS
 
     SEPSCO considers all highly liquid instruments with an original maturity of
three months or less when purchased to be cash equivalents.
 
INVENTORIES
 
     Inventories are determined  under the  lower of  cost (first-in,  first-out
basis) or market basis.
 
DEPRECIATION, DEPLETION AND AMORTIZATION
 
     Assets acquired prior to March 1, 1980 are depreciated on the straight-line
basis using composite annual rates on the majority of properties of 5.2% to 7.2%
for refrigeration properties; and 5% for liquefied petroleum gas properties. The
development  of these composite rates was based on the estimated useful lives of
the related  asset groups.  Under  the composite  method of  depreciation,  upon
normal  retirement  or  replacement,  the cost  of  property,  less  any salvage
proceeds, is charged to accumulated depreciation. Gains and losses arising  from
abnormal retirements or disposals are included in current earnings.
 
     Assets  acquired  on  or  after  March  1,  1980  are  depreciated  on  the
straight-line basis  using  the estimated  useful  lives of  the  related  major
classes  of properties; 3 to 9 years for automotive equipment; 5 to 20 years for
machinery and equipment;  and 20  to 30  years for  buildings and  improvements.
Under  this  method, gains  and losses  arising from  disposals are  included in
current earnings.
 
     Depreciation and depletion on natural  gas and oil properties are  computed
using  the units-of-production  method based  on proven  reserves estimated from
engineering data.
 
     Financing costs  incurred  in  connection with  the  issuance  of  SEPSCO's
11  7/8% Senior  Subordinated Debentures  (the '11  7/8% Debentures')  are being
amortized as interest expense over the term of the 11 7/8% Debentures using  the
effective  interest  method.  At  February 28,  1992  and  1993,  $1,342,000 and
$1,063,000, respectively,  of  such  unamortized deferred  financing  costs  are
included in 'Other assets' in the accompanying consolidated balance sheets.
 
     The  original  issue  debt discount  on  the  11 7/8%  Debentures  is being
amortized as interest expense over the term of the 11 7/8% Debentures using  the
effective  interest  method. Such  unamortized debt  discount  is reported  as a
reduction of related  long-term debt  in the  accompanying consolidated  balance
sheets.
 
                                      F-53
 
<PAGE>
              SOUTHEASTERN PUBLIC SERVICE COMPANY AND SUBSIDIARIES
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
 
INCOME TAXES
 
     Federal income tax returns for SEPSCO and its consolidated subsidiaries are
filed  on a consolidated basis. Deferred  income taxes are provided to recognize
timing differences of income and expense  items for financial and tax  reporting
purposes.
 
     In  February 1992, the Financial Accounting Standards Board ('FASB') issued
Statement of Financial  Accounting Standards ('SFAS')  No. 109, 'Accounting  for
Income  Taxes', which requires SEPSCO to adopt the new accounting and disclosure
rules no later than the first quarter of the ten months ending December 31, 1993
('SEPSCO Transition 1993'). SEPSCO adopted  the new standard effective March  1,
1993  and did not restate prior periods. The cumulative effect on prior years of
this change in accounting principles for the three months ended May 31, 1993 was
a favorable effect of $7,617,000 or $.65 per share.
 
POSTRETIREMENT BENEFITS OTHER THAN PENSIONS
 
     In December  1990,  the  FASB  issued a  new  standard  on  accounting  for
postretirement benefits other than pensions, SFAS No. 106 'Employers' Accounting
for Postretirement Benefits Other than Pensions', which requires SEPSCO to adopt
the  new accounting  and disclosure  rules no  later than  the first  quarter of
Transition 1993. This  new standard  requires that  the expected  cost of  these
benefits  be charged to expense during  the years that employees render service.
SEPSCO adopted the new standard effective March 1, 1993, the effect of which was
immaterial.
 
OIL AND GAS
 
     The successful efforts method of accounting is followed for costs  incurred
in  oil  and gas  exploration and  development activities.  Property acquisition
costs for oil and gas properties  are initially capitalized. When a property  is
determined  to  contain  proven  reserves, its  property  acquisition  costs are
transferred to  proven properties  and amortized  using the  units-of-production
method.   Exploration  costs  other  than  drilling,  including  geological  and
geophysical costs  are  expensed as  incurred.  Exploratory drilling  costs  are
initially capitalized. If and when a property is determined to be nonproductive,
property acquisition and exploratory drilling costs are expensed.
 
INCOME (LOSS) PER SHARE
 
     Income  (loss) per share  has been computed by  dividing net income (loss),
after the reduction for preferred  stock dividend requirements, by the  weighted
average  number (11,655,067)  of common  shares outstanding  during each  of the
years in the three year period ended February 28, 1993.
 
(2) DISCONTINUED OPERATIONS
 
     SEPSCO originally  issued its  consolidated  financial statements  for  the
fiscal year ended February 28, 1993 in May 1993. Subsequent thereto, on July 22,
1993  SEPSCO's  Board of  Directors authorized  the sale  or liquidation  of its
utility  and  municipal  services,  refrigeration   and  natural  gas  and   oil
businesses.  Accordingly,  SEPSCO  has  restated  the  accompanying consolidated
financial statements for each  of the three years  in the period ended  February
28,  1993 to reflect such businesses as discontinued operations. In addition, on
July  22,  1993  SEPSCO's  Board  of  Directors  also  authorized  the  sale  or
liquidation  of  the liquefied  petroleum gas  business  (see Note  18 regarding
discussion of subsequent events).  On September 1, 1993  SEPSCO entered into  an
agreement  to  sell  the  assets of  its  tree  maintenance  services operations
previously included in its utility  and municipal services business segment  for
approximately  $70,000,000 of cash plus the assumption by the purchaser of up to
$5,000,000 in  current  liabilities. The  resulting  gain  or loss  is  not  yet
determinable; management of SEPSCO, however, expects to approximately break even
on  such sales, or, at worst, incur an immaterial loss. Consummation of the sale
is subject to  the satisfaction of  a number of  standard conditions,  including
 
                                      F-54
 
<PAGE>
              SOUTHEASTERN PUBLIC SERVICE COMPANY AND SUBSIDIARIES
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
 
regulatory  approvals. The precise timetable for the sale and liquidation of the
remaining discontinued businesses will depend upon SEPSCO's ability to  identify
appropriate  purchasers and to  negotiate acceptable terms for  the sale of such
businesses and  assets. However,  SEPSCO currently  anticipates completing  such
sales  or liquidations  by July  31, 1994.  After consideration  of a $4,903,000
pre-tax write-down in SEPSCO Fiscal 1993 relating to accruals for  environmental
remediation  and losses on certain contracts  in progress reflected in operating
profit (loss) of discontinued operations summarized below, an $8,000,000 pre-tax
provision  for  impairment  of  certain  unprofitable  properties   subsequently
recorded  during the quarter ended May 31, 1993 (resulting from an evaluation of
the properties on a sale or liquidation basis rather than on an operating  basis
due  to the anticipated decision which was reached subsequent to the issuance of
the May 31, 1993 financial statements to sell or liquidate such properties)  and
based  on the analysis performed to  date, SEPSCO expects that such dispositions
including results of operations through  the anticipated disposal dates and  any
loss  on the sale  of the tree  maintenance services operations  will not in the
aggregate result in a net  loss to SEPSCO (see  Note 18 regarding discussion  of
subsequent events).
 
                                      F-55
 
<PAGE>
              SOUTHEASTERN PUBLIC SERVICE COMPANY AND SUBSIDIARIES
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
 
Condensed  financial information for the discontinued operations, which has been
retroactively classified separately in  the accompanying consolidated  financial
statements, is as follows:
 
<TABLE>
<CAPTION>
                                                                                                FEBRUARY 28,
                                                                        ------------------------------------------------------------
                                                                                    1992                            1993
                                                                        ----------------------------    ----------------------------
                                                                                        UTILITY AND                     UTILITY AND
                                                                                         MUNICIPAL                       MUNICIPAL
                                                                        NATURAL GAS    SERVICES AND     NATURAL GAS    SERVICES AND
                                                                          AND OIL      REFRIGERATION      AND OIL      REFRIGERATION
                                                                        -----------    -------------    -----------    -------------
                                                                                               (IN THOUSANDS)
<S>                                                                     <C>            <C>              <C>            <C>
Current assets:
     Cash............................................................     $--            $ --             $--            $ --
     Receivables, less allowance for doubtful accounts...............         350           25,763            365           26,313
     Inventories.....................................................         184            3,530            160            2,894
     Other current assets............................................          68            2,094             40            1,939
                                                                        -----------    -------------    -----------    -------------
          Total current assets.......................................         602           31,387            565           31,146
                                                                        -----------    -------------    -----------    -------------
Current liabilities:
     Current portion of long-term debt...............................      --                   25         --                  349
     Current portion of capital leases due to leasing affiliate......          51           11,527             25           10,245
     Accounts payable................................................         447            9,858            287            8,693
     Accrued salaries and wages......................................          61            2,743             29            2,800
     Other accrued expenses..........................................         786            6,671            879            6,417
                                                                        -----------    -------------    -----------    -------------
          Total current liabilities..................................       1,345           30,824          1,220           28,504
                                                                        -----------    -------------    -----------    -------------
               Net current assets (liabilities) of discontinued
                 operations..........................................     $  (743)       $     563        $  (655)       $   2,642
                                                                        -----------    -------------    -----------    -------------
                                                                        -----------    -------------    -----------    -------------
Non-current assets:
     Properties......................................................     $18,764        $ 181,032        $18,893        $ 189,101
     Less accumulated depreciation, depletion and amortization.......      10,600           95,219         11,489          104,625
                                                                        -----------    -------------    -----------    -------------
                                                                            8,164           85,813          7,404           84,476
     Other assets....................................................          43            1,197             29            1,083
                                                                        -----------    -------------    -----------    -------------
          Total non-current assets...................................       8,207           87,010          7,433           85,559
                                                                        -----------    -------------    -----------    -------------
Non-current liabilities:
     Long-term debt..................................................      --                   92         --                  172
     Capitalized leases due to leasing affiliate.....................          34           17,944             21           16,799
     Deferred income taxes...........................................       1,580            5,418          1,303            5,162
     Other liabilities...............................................           5              976            304            3,047
                                                                        -----------    -------------    -----------    -------------
          Total non-current liabilities..............................       1,619           24,430          1,628           25,180
                                                                        -----------    -------------    -----------    -------------
               Net non-current assets of discontinued operations.....     $ 6,588        $  62,580        $ 5,805        $  60,379
                                                                        -----------    -------------    -----------    -------------
                                                                        -----------    -------------    -----------    -------------
</TABLE>
 
                                      F-56
 
<PAGE>
              SOUTHEASTERN PUBLIC SERVICE COMPANY AND SUBSIDIARIES
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
 
<TABLE>
<CAPTION>
                                                                   YEAR ENDED FEBRUARY 28,
                               -----------------------------------------------------------------------------------------------
                                           1991                            1992                             1993
                               -----------------------------   -----------------------------   -------------------------------
                                               UTILITY AND                     UTILITY AND                      UTILITY AND
                                                MUNICIPAL                       MUNICIPAL                        MUNICIPAL
                               NATURAL GAS     SERVICES AND    NATURAL GAS     SERVICES AND    NATURAL GAS      SERVICES AND
                                 AND OIL      REFRIGERATION      AND OIL      REFRIGERATION      AND OIL       REFRIGERATION
                               ------------   --------------   ------------   --------------   ------------   ----------------
                                                                       (IN THOUSANDS)
<S>                            <C>            <C>              <C>            <C>              <C>            <C>
Operating revenues:
     Net sales................ $    6,900     $      11,083    $    5,488     $      32,709    $    5,488     $        10,818
     Service revenues.........     --               170,178        --               162,156        --                 188,408
                               ------------   --------------   ------------   --------------   ------------   ----------------
                                    6,900           181,261         5,488           194,865         5,488             199,226
                               ------------   --------------   ------------   --------------   ------------   ----------------
Operating costs and expenses:
     Cost of sales............      3,530            12,131         2,997            11,095         3,934              10,805
     Cost of services.........     --               160,486        --               168,639        --                 176,895
     Selling, general and
       administrative
       expenses...............      3,681            15,465         2,139            12,784         2,070              13,011
                               ------------   --------------   ------------   --------------   ------------   ----------------
                                    7,211           188,082         5,136           192,518         6,004             200,711
                               ------------   --------------   ------------   --------------   ------------   ----------------
          Operating profit
            (loss)............       (311  )         (6,821 )         352             2,347          (516  )           (1,485 )
                               ------------   --------------   ------------   --------------   ------------   ----------------
Other income (expense):
     Interest expense.........        (18  )         (4,179 )         (14  )         (4,416 )          (9  )           (3,738 )
     Other, net...............          1              (610 )        (148  )          1,397            26              (2,240 )
                               ------------   --------------   ------------   --------------   ------------   ----------------
                                      (17  )         (4,789 )        (162  )         (3,019 )          17              (5,978 )
                               ------------   --------------   ------------   --------------   ------------   ----------------
     Income (loss) before
       income taxes...........       (328  )        (11,610 )         190              (672 )        (499  )           (7,463 )
Benefit from (provision for)
  income taxes................        107             3,932          (126  )            383           172               2,248
                               ------------   --------------   ------------   --------------   ------------   ----------------
     Income (loss) from
       discontinued
       operations............. $     (221  )  $      (7,678 )  $       64     $        (289 )  $     (327  )  $        (5,215 )
                               ------------   --------------   ------------   --------------   ------------   ----------------
                               ------------   --------------   ------------   --------------   ------------   ----------------
</TABLE>
 
(3) RESTRICTED CASH AND EQUIVALENTS
 
     SEPSCO has an arrangement with a bank providing for the issuance of letters
of  credit  for the  purpose  of securing  certain  performance and  other bonds
associated with  the  discontinued  operations.  These  letters  of  credit  are
collateralized  by cash  deposited in  restricted interest-bearing  accounts not
associated with the discontinued operations.
 
(4) DUE UNDER ACCOUNTS RECEIVABLE FINANCING
 
     In January  1991,  SEPSCO entered  into  an accounts  receivable  financing
arrangement  with  a  commercial  lender  which  covered  substantially  all the
accounts receivable  of the  tree maintenance  activities and  the  construction
related  activities of the utility and  municipal services segment and a certain
location of the  refrigeration segment (the  'Covered Segments'). Such  advances
bore  interest  at the  prime rate  (6% at  February  28, 1993)  plus 1%,  and a
commission of 1% of each account receivable for which advances were made and the
payment of  an  administrative  fee  of $100,000  per  year.  Pursuant  to  this
arrangement,  all accounts  receivable of the  Covered Segments  were pledged as
collateral. The  proceeds  from  this  financing  were  utilized  for  corporate
obligations.  As described in Note 17, on April 23, 1993, upon completion of the
acquisition (the 'Acquisition')  of 28.6%  of Triarc by  DWG Acquisition  Group,
L.P.,  ('DWG Acquisition'), SEPSCO paid $12,689,000  outstanding as of that date
under  the  accounts  receivable  financing  arrangement  and  terminated   such
arrangement.
 
                                      F-57
 
<PAGE>
              SOUTHEASTERN PUBLIC SERVICE COMPANY AND SUBSIDIARIES
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
 
(5) NOTES RECEIVABLE FROM TRIARC
 
     SEPSCO  holds a promissory note (the 'Note') of Triarc in the original face
amount of  $48,952,000, bearing  interest  at the  annual  rate of  13%  payable
semi-annually.  On  April  23,  1993 SEPSCO  received  a  partial  prepayment of
$22,414,000 on the  principal of the  Note plus $1,430,000  of accrued  interest
from  Triarc. The Note, after giving effect to such prepayment, is due on August
1, 1998.  The Note  resulted from  the 1986  sale of  approximately 51%  of  the
outstanding  common  shares of  Graniteville to  Triarc and  is secured  by such
shares. The Note is subordinated to senior indebtedness of Triarc to the extent,
if any, that the payment of principal and interest thereon is not satisfied  out
of proceeds of the pledged Graniteville shares.
 
     At  February 28,  1993 SEPSCO also  held an unsecured  promissory note (the
'Promissory Note') of Triarc in the face amount of $6,500,000, bearing  interest
at  an annual rate of 13%, payable  semi-annually and maturing on July 12, 1993.
The Promissory Note  arose in connection  with the  sale of common  stock of  an
unaffiliated  company  to Triarc.  The Promissory  Note was  recorded net  of an
original deferred discount of  $500,000 which was  amortized to interest  income
using  the effective interest rate method.  The carrying value of the Promissory
Note at February 28, 1992 and 1993 was $6,335,000 and $6,461,000,  respectively.
Netted against such Promissory Note, which is reflected as a current asset as of
February   28,  1993,  are  current  amounts  payable  to  Triarc  amounting  to
$3,828,000. Such amount at February 28, 1992 of $3,102,000 was included in  'Net
current  assets  of discontinued  operations'  in the  accompanying consolidated
balance sheet. As described in Note 17,  on April 23, 1993 SEPSCO received  full
payment  of the Promissory Note in  the amount of $6,806,000, including $306,000
of accrued interest from  Triarc. Such payment included  $3,271,000 in cash  and
$3,535,000  in offsets of amounts owed by SEPSCO to Triarc. A related $6,000,000
gain on the sale of  the common stock of an  unaffiliated company to Triarc  had
been previously deferred until collection of the Promissory Note was assured. As
such  note was collected  in April 1993,  the $6,000,000 gain  was recognized in
SEPSCO Fiscal 1993. Such deferred gain had been deferred in 'Other  liabilities'
in the accompanying consolidated balance sheet as of February 28, 1992.
 
(6) PROPERTIES
 
     The following is a summary of the components of properties, at cost:
 
<TABLE>
<CAPTION>
                                                                                             FEBRUARY 28,
                                                                                     ----------------------------
                                                                                         1992            1993
                                                                                     ------------    ------------
                                                                                            (IN THOUSANDS)
<S>                                                                                  <C>             <C>
Land..............................................................................     $    1,216      $    1,722
Buildings and improvements........................................................          1,232           1,244
Machinery and equipment...........................................................         13,600          13,601
Automotive equipment..............................................................          3,860           3,964
                                                                                     ------------    ------------
                                                                                           19,908          20,531
Less accumulated depreciation.....................................................         12,380          12,706
                                                                                     ------------    ------------
                                                                                       $    7,528      $    7,825
                                                                                     ------------    ------------
                                                                                     ------------    ------------
</TABLE>
 
                                      F-58
 
<PAGE>
              SOUTHEASTERN PUBLIC SERVICE COMPANY AND SUBSIDIARIES
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
 
(7) INVESTMENTS IN AFFILIATES
 
     Investments in affiliates consisted of the following:
 
<TABLE>
<CAPTION>
                                                                                        FEBRUARY 28,
                                                                                     ------------------
                                                                                      1992       1993
                                                                                     -------    -------
                                                                                       (IN THOUSANDS)
<S>                                                                                  <C>        <C>
Graniteville......................................................................   $59,496    $62,530
CFC Holdings......................................................................     1,909      1,297
Chesapeake Insurance..............................................................     1,500      1,500
                                                                                     -------    -------
                                                                                     $62,905    $65,327
                                                                                     -------    -------
                                                                                     -------    -------
</TABLE>
 
     Equity  in  earnings  of affiliates  before  income taxes  on  the ultimate
distribution of earnings of affiliates  to SEPSCO, cumulative effect of  changes
in accounting principles and extraordinary items consisted of the following:
 
<TABLE>
<CAPTION>
                                                                               YEAR ENDED FEBRUARY 28,
                                                                             ---------------------------
                                                                              1991      1992      1993
                                                                             ------    ------    -------
                                                                                   (IN THOUSANDS)
<S>                                                                          <C>       <C>       <C>
Graniteville..............................................................   $3,909    $6,009    $12,426
CFC Holdings..............................................................   (1,226)     (808)      (265)
                                                                             ------    ------    -------
                                                                             $2,683    $5,201    $12,161
                                                                             ------    ------    -------
                                                                             ------    ------    -------
</TABLE>
 
GRANITEVILLE
 
     Summary  consolidated  balance sheets  at February  28,  1992 and  1993 and
consolidated statements of  earnings for  each of  the years  in the  three-year
period ended February 28, 1993 of Graniteville are as follows:
 
<TABLE>
<CAPTION>
                                                                                       FEBRUARY 28,
                                                                                   --------------------
                                                                                     1992        1993
                                                                                   --------    --------
                                                                                      (IN THOUSANDS)
<S>                                                                                <C>         <C>
Summary Consolidated Balance Sheets
     Current assets.............................................................   $114,801    $154,258
     Properties, net............................................................    102,119     105,472
     Other assets...............................................................      3,422       3,634
                                                                                   --------    --------
                                                                                   $220,342    $263,364
                                                                                   --------    --------
                                                                                   --------    --------
     Current liabilities........................................................   $ 46,781    $ 59,856
     Long-term debt.............................................................     41,821      52,896
     Deferred income taxes......................................................      9,845      21,374
     Other liabilities..........................................................        475       1,626
     Stockholders' equity.......................................................    121,420     127,612
                                                                                   --------    --------
                                                                                   $220,342    $263,364
                                                                                   --------    --------
                                                                                   --------    --------
</TABLE>
 
<TABLE>
<CAPTION>
                                                                          YEAR ENDED FEBRUARY 28,
                                                                      --------------------------------
                                                                        1991        1992        1993
                                                                      --------    --------    --------
                                                                               (IN THOUSANDS)
<S>                                                                   <C>         <C>         <C>
Summary Consolidated Statements of Income
     Operating revenues............................................   $414,538    $456,402    $499,060
     Operating profit..............................................     10,619      28,786      49,734
     Income before cumulative effect of changes in accounting
       principles..................................................      7,978      12,263      25,360
     Net income....................................................      7,978      12,263      12,324
</TABLE>
 
                                      F-59
 
<PAGE>
              SOUTHEASTERN PUBLIC SERVICE COMPANY AND SUBSIDIARIES
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
 
     In  SEPSCO Fiscal 1993 Graniteville adopted SFAS  109 and SFAS 106 with the
cumulative effect of changes  in accounting principles  resulting in charges  to
Graniteville's  consolidated statement of earnings  amounting to $12,314,000 for
SFAS 109 and  $722,000, net of  Graniteville's taxes of  $429,000 for SFAS  106.
Graniteville's  equity,  net of  taxes of  $434,000  in such  cumulative effect,
amounted to a charge of $5,954,000 or $.51 per share.
 
     As a result of the Acquisition, Graniteville is permitted to pay  dividends
or  make loans or advances to SEPSCO in an amount equal to 50% of the net income
of Graniteville  accumulated  from  the  beginning  of  the  first  fiscal  year
commencing  on  or  after  December  20,  1994,  provided  that  the outstanding
principal balance of Graniteville's  term loan is less  than $50 million at  the
time  of  the  payments  and  certain  other  conditions  are  met. Accordingly,
following the Acquisition and prior to  February 28, 1996, Graniteville will  be
unable  to pay any dividends  to SEPSCO. Cash dividends  received by SEPSCO from
its investment in Graniteville were,  $4,576,000, $1,038,000 and $3,004,000,  in
the years ended February 28, 1991, 1992 and 1993, respectively.
 
CFC HOLDINGS
 
     SEPSCO presently owns 5.4% of the outstanding common stock of CFC Holdings.
The  remaining 94.6%  of such  common stock  is currently  owned by  Triarc. CFC
Holdings owns  100% of  RC/Arby's Corporation  ('RC/Arby's', formerly  known  as
Royal  Crown Corporation) (the  principal subsidiaries of  which are Arby's Inc.
('Arby's') and Royal  Crown Company, Inc.  ('RC Cola', formerly  known as  Royal
Crown  Cola  Co.,  Inc.)  and Chesapeake  Insurance.  SEPSCO  received  its 5.4%
interest in CFC Holdings in July 1991 in exchange for its then 5.4% interest  in
the  common stock of RC/Arby's which at that  time owned 100% of Arby's, RC Cola
and Chesapeake Insurance.  In connection  with a capital  restructuring in  July
1991,  all  of the  RC/Arby's  preferred stock  which  was owned  by  Triarc was
converted into common stock of RC/Arby's reducing SEPSCO's ownership  percentage
from  its then 48%  to 5.4%. The  reduction in SEPSCO's  ownership in connection
with such restructuring resulted in SEPSCO reclassifying as of August 31,  1991,
to  'Additional paid-in  capital', the  cumulative equity  in net  losses of CFC
Holdings amounting  to  $15,210,000  which was  previously  recorded  in  'Other
liabilities'.
 
     SEPSCO's  equity  in  extraordinary  items  relates  to  CFC  Holdings  and
consisted of a credit in SEPSCO Fiscal  1991 of $794,000 due to the  utilization
of  a net  operating loss  carryforward and  a charge  in SEPSCO  Fiscal 1993 of
$348,000 due to the early extinguishment of debt.
 
     In SEPSCO  Fiscal  1992,  SEPSCO purchased  15,000  convertible  redeemable
preferred shares of Chesapeake Insurance for $1,500,000. Such stock bears annual
dividends,  as  and  when  declared  by  Chesapeake  Insurance,  of  6%  and  is
convertible into Chesapeake  Insurance common  shares at  a price  of $5.52  per
common share. If all convertible preferred shares issued by Chesapeake Insurance
were converted to common shares SEPSCO's ownership of Chesapeake Insurance would
be 11.5%. SEPSCO accounts for such investment on the cost method.
 
                                      F-60
 
<PAGE>
              SOUTHEASTERN PUBLIC SERVICE COMPANY AND SUBSIDIARIES
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
 
(8) INCOME TAXES
 
     The  benefit from (provision  for) income taxes  consisted of the following
components:
 
<TABLE>
<CAPTION>
                                                                              YEAR ENDED FEBRUARY 28,
                                                                           -----------------------------
                                                                            1991       1992       1993
                                                                           -------    -------    -------
                                                                                  (IN THOUSANDS)
<S>                                                                        <C>        <C>        <C>
Current:
     Federal............................................................   $(1,181)   $  (849)   $  (183)
     State..............................................................      (268)      (312)      (227)
                                                                           -------    -------    -------
                                                                            (1,449)    (1,161)      (410)
                                                                           -------    -------    -------
Deferred:
     Federal............................................................        19       (326)    (1,291)
     State..............................................................        29         51         30
                                                                           -------    -------    -------
                                                                                48       (275)    (1,261)
                                                                           -------    -------    -------
                                                                           $(1,401)   $(1,436)   $(1,671)
                                                                           -------    -------    -------
                                                                           -------    -------    -------
</TABLE>
 
     The difference  between  the  reported  tax  benefit  (provision)  and  the
computed tax benefit (provision) at the statutory rate is reconciled as follows:
 
<TABLE>
<CAPTION>
                                                                              YEAR ENDED FEBRUARY 28,
                                                                           -----------------------------
                                                                            1991       1992       1993
                                                                           -------    -------    -------
                                                                                  (IN THOUSANDS)
<S>                                                                        <C>        <C>        <C>
Income from continuing operations before income taxes, cumulative effect
  of changes in accounting principles and extraordinary items of
  affiliate.............................................................   $ 5,646    $ 7,768    $14,243
                                                                           -------    -------    -------
                                                                           -------    -------    -------
Computed expected tax benefit (provision) at 34%........................   $(1,920)   $(2,641)   $(4,843)
Decrease (increase) in Federal taxes from:
     Dividend exclusion on equity in earnings of affiliates.............       730      1,415      3,308
     State taxes, net of Federal income tax benefit.....................      (158)      (172)      (130)
     Other, net.........................................................       (53)       (38)        (6)
                                                                           -------    -------    -------
                                                                           $(1,401)   $(1,436)   $(1,671)
                                                                           -------    -------    -------
                                                                           -------    -------    -------
</TABLE>
 
     The deferred income tax (provision) benefit consisted of the following:
 
<TABLE>
<CAPTION>
                                                                              YEAR ENDED FEBRUARY 28,
                                                                            ----------------------------
                                                                             1991      1992       1993
                                                                            ------    ------    --------
                                                                                   (IN THOUSANDS)
<S>                                                                         <C>       <C>       <C>
Gain on sale of marketable security......................................   $ --      $ --      $ (2,040)
Book over tax gain on repurchase of Debentures...........................     (402)     (764)      --
Original issue discount..................................................      200        72          (9)
Settlement of litigation.................................................     --        --           442
Book over tax depreciation...............................................      144       318         339
Other....................................................................      106        99           7
                                                                            ------    ------    --------
                                                                            $   48    $ (275)   $ (1,261)
                                                                            ------    ------    --------
                                                                            ------    ------    --------
</TABLE>
 
     The  net liability for  non-current deferred income taxes  is reported as a
separate line item on the accompanying consolidated balance sheets while the net
benefit for current deferred income taxes of $663,000 as of February 28, 1993 is
included in 'Other current assets'.
 
     As of February  28, 1993 SEPSCO  had net operating  loss carryforwards  for
federal   income  tax  reporting  purposes  of  approximately  $6,200,000.  Such
carryforwards will expire in the amount of approximately $3,300,000 in the  year
2006   and   approximately   $2,900,000   in   the   year   2008.   In  addition
 
                                      F-61
 
<PAGE>
              SOUTHEASTERN PUBLIC SERVICE COMPANY AND SUBSIDIARIES
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
 
SEPSCO has depletion  carryforwards of  $5,000,000 and  alternative minimum  tax
credit  carryforwards  of  approximately,  $3,400,000,  both  of  which  have an
unlimited carryforward period. Such carryforwards are available to offset future
taxable income and capital gains, if any.
 
     Federal income tax  returns of SEPSCO  have been examined  by the  Internal
Revenue Service ('IRS') for the tax years 1986 through 1988. Such audit has been
substantially  resolved  at no  material cost  to SEPSCO.  The IRS  has recently
commenced the examination  of SEPSCO's Federal  income tax returns  for the  tax
years  1989 through 1992.  The amount and  timing of any  payments required as a
result of the 1989 through 1992  audit cannot presently be determined.  However,
SEPSCO  believes that it has adequate  aggregate reserves for any tax liability,
including interest, that may result from all such examinations.
 
(9) LONG-TERM DEBT
 
     Long-term debt consists of the following:
 
<TABLE>
<CAPTION>
                                                                                                  FEBRUARY 28,
                                                                               --------------------------------------------------
                                                                                        1992                       1993
                                                                               -----------------------    -----------------------
                                                                                                 (IN THOUSANDS)
<S>                                                                            <C>                        <C>
11 7/8% Senior Subordinated Debentures due February 1, 1998 (less
  unamortized deferred debt discount of $6,666,000 and $5,282,000)..........           $65,334                    $57,718
Capitalized lease obligations with an affiliate (see Note 11)...............               636                        703
10%-13% mortgage and equipment notes due 1994 to 2003.......................               146                        546
Other.......................................................................         --                                 6
                                                                                    ----------                 ----------
                                                                                        66,116                     58,973
Less current portion of long-term debt......................................             9,290                      9,312
                                                                                    ----------                 ----------
                                                                                       $56,826                    $49,661
                                                                                    ----------                 ----------
                                                                                    ----------                 ----------
</TABLE>
 
     Aggregate annual maturities, including  required sinking fund payments  and
capitalized  lease obligations, of long-term debt as of February 28, 1993 are as
follows (in thousands):
 
<TABLE>
<CAPTION>
YEAR ENDED FEBRUARY 28,
- -----------------------------------------------------------------------------------
<S>                                                                                   <C>
1994...............................................................................   $ 9,312
1995...............................................................................     9,259
1996...............................................................................     9,184
1997...............................................................................     9,118
1998...............................................................................    27,089
Thereafter.........................................................................       293
                                                                                      -------
                                                                                       64,255
Less unamortized deferred debt discount at February 28, 1993.......................     5,282
                                                                                      -------
                                                                                      $58,973
                                                                                      -------
                                                                                      -------
</TABLE>
 
     SEPSCO is required to  retire annually, through  a mandatory sinking  fund,
$9,000,000  principal amount of the 11 7/8% Debentures through 1997 with a final
payment of  $27,000,000  due in  1998.  On February  1,  1991 and  1992,  SEPSCO
satisfied its mandatory sinking fund requirement due on such dates by purchasing
in  the open  market the  required $9,000,000 principal  amount of  such 11 7/8%
Debentures. On  February 1,  1993 SEPSCO  satisfied its  mandatory sinking  fund
requirement  due on such date  by payment of $8,734,000  in cash and $266,000 of
principal amount of 11 7/8% Debentures.  The discount on the 11 7/8%  Debentures
purchased  is reported as a separate  line item in the accompanying consolidated
statements of operations.
 
                                      F-62
 
<PAGE>
              SOUTHEASTERN PUBLIC SERVICE COMPANY AND SUBSIDIARIES
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
 
     Under provisions of the indenture  (the 'Indenture') pursuant to which  the
11  7/8% Debentures were issued,  SEPSCO is permitted to  pay cash dividends and
acquire shares of SEPSCO's capital  stock up to a  maximum of $10,412,000 as  of
February 28, 1993.
 
     The  Indenture  contains  a  provision  which  limits  to  $100,000,000 the
aggregate amount  of  specified  kinds  of  indebtedness  that  SEPSCO  and  its
consolidated  subsidiaries can incur. At February 28, 1993 such indebtedness was
$82,369,000 resulting in allowable indebtedness of $17,631,000.
 
(10) STOCKHOLDERS' EQUITY
 
     Additional paid-in capital increased by  $15,210,000 in SEPSCO Fiscal  1992
as  a result of the reduction in equity  ownership of an affiliate (see Note 7).
There were no other changes in  the stockholders' equity accounts for the  three
years ended February 28, 1993 except for retained earnings (accumulated deficit)
as  set forth on the consolidated statements of operations and retained earnings
(accumulated deficit).
 
     At February 28, 1993, 64.9% of SEPSCO's outstanding common stock $1.00  par
value per share (the 'SEPSCO Common Stock') and all of the convertible preferred
stock,  Series B, was owned by Triarc. Such common stock ownership was increased
to 71.1% as of April 23, 1993. The convertible preferred stock bears a  dividend
of  5 1/2% and  is convertible into  8,167 shares of  common stock at  a rate of
$3.00 per share.
 
     Included  in  'Retained  earnings'  at  February  28,  1992  and  1993  are
$1,299,000  and  $3,309,000  of  net  undistributed  earnings  of unconsolidated
affiliates, respectively.
 
(11) LEASE COMMITMENTS
 
     SEPSCO leases certain machinery,  automotive and other equipment  primarily
from  an  indirect,  wholly-owned  subsidiary of  Triarc  under  long-term lease
obligations which  are  accounted for  as  capital leases  in  the  accompanying
consolidated  balance sheets.  The cost  of properties  under capital  leases of
continuing operations (included in 'Properties, net') amounted to $1,280,000 and
$1,264,000 at  February  28,  1992  and 1993,  respectively,  and  the  cost  of
properties  under capital  leases of  discontinued operations  (included in 'Net
non-current assets  of discontinued  operations')  amounted to  $58,357,000  and
$54,698,000, respectively.
 
                                      F-63
 
<PAGE>
              SOUTHEASTERN PUBLIC SERVICE COMPANY AND SUBSIDIARIES
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
 
     The  future minimum lease  payments (net of sublease  rentals which are not
significant)  under  capital  leases  and  operating  leases  with  an   initial
noncancelable term in excess of one year are as follows as of February 28, 1993:
 
<TABLE>
<CAPTION>
                                           CAPITAL LEASES                          OPERATING LEASES
                                -------------------------------------    ------------------------------------
                                CONTINUING    DISCONTINUED               CONTINUING    DISCONTINUED
YEAR ENDED FEBRUARY 28,         OPERATIONS     OPERATIONS      TOTAL     OPERATIONS     OPERATIONS     TOTAL
- -----------------------------   ----------    ------------    -------    ----------    ------------    ------
                                                               (IN THOUSANDS)
<S>                             <C>           <C>             <C>        <C>           <C>             <C>
1994.........................      $327         $ 12,552      $12,879       $281           $134        $  415
1995.........................       248            9,213        9,461        227             93           320
1996.........................       149            6,155        6,304        148             34           182
1997.........................        69            2,809        2,878         43             28            71
1998.........................        30            1,032        1,062          9              2            11
Thereafter...................     --              --            --            17          --               17
                                ----------    ------------    -------    ----------      ------        ------
Total minimum lease
  payments...................       823           31,761       32,584       $725           $291        $1,016
                                                                         ----------      ------        ------
                                                                         ----------      ------        ------
Less amounts representing
  interest...................       120            4,671        4,791
                                ----------    ------------    -------
Present value of minimum
  lease payments.............      $703         $ 27,090      $27,793
                                ----------    ------------    -------
                                ----------    ------------    -------
</TABLE>
 
     Rental expense under operating leases, which is primarily for the rental of
office  space,  was $2,764,000  in SEPSCO  Fiscal 1991,  $2,330,000 in  1992 and
$2,012,000 in  1993, of  which $629,000,  $537,000 and  $485,000,  respectively,
related  to  continuing operations  and  $2,135,000, $1,793,000  and $1,527,000,
respectively, related to discontinued operations.
 
(12) RETIREMENT PLANS
 
     Substantially all  of  the employees  of  the continuing  and  discontinued
businesses are covered under SEPSCO's 401(k) defined contribution plan or one of
the multi-employer union plans to which SEPSCO contributes.
 
     The defined contribution plan allows eligible employees to contribute up to
15%  of their  total earnings,  subject to  certain limitations.  SEPSCO makes a
matching  contribution  for  eligible  employees   of  25%  of  the   employee's
contributions  but limited to the first 5%  of an employee's compensation and an
additional contribution equal to  1/4 of 1% of  such employee's total  earnings.
Total  contributions were $395,000  in SEPSCO Fiscal 1991,  $368,000 in 1992 and
$394,000 in 1993.
 
     SEPSCO had several defined benefit pension plans, all of which were  frozen
prior  to  February 28,  1990. SEPSCO's  applications  with the  Pension Benefit
Guaranty Corporation and the  Internal Revenue Service  for the termination  and
distribution of surplus pension assets of SEPSCO's defined benefit pension plans
were  approved during  SEPSCO Fiscal 1992.  After the purchase  of annuities for
plan participants, SEPSCO received the net surplus pension assets of  $3,226,000
in  SEPSCO Fiscal 1992 and $206,000 in  SEPSCO Fiscal 1993. Substantially all of
the gain on such reversions had  previously been reflected through February  28,
1992  in  accordance with  SFAS 87,  including $963,000  and $863,000  in SEPSCO
Fiscal 1991 and 1992, respectively. During the year ended February 28, 1993  all
remaining  prepaid and  accrued pension costs  existing as of  February 28, 1992
were eliminated resulting in a termination gain of $431,000.
 
                                      F-64
 
<PAGE>
              SOUTHEASTERN PUBLIC SERVICE COMPANY AND SUBSIDIARIES
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
 
     The components of  the SEPSCO  Fiscal 1991  and 1992  net periodic  pension
benefits are as follows:
 
<TABLE>
<CAPTION>
                                                                                         FEBRUARY 28,
                                                                                      ------------------
                                                                                       1991       1992
                                                                                      -------    -------
                                                                                        (IN THOUSANDS)
<S>                                                                                   <C>        <C>
Service cost.......................................................................   $     2    $ --
Interest cost on projected benefit obligation......................................       695        604
Return on plan assets..............................................................    (1,381)    (1,241)
Amortization, net of deferral......................................................      (279)      (226)
                                                                                      -------    -------
     Net periodic pension benefits.................................................   $  (963)   $  (863)
                                                                                      -------    -------
                                                                                      -------    -------
</TABLE>
 
     An  assumed discount rate of 7.5% in SEPSCO  Fiscal 1991 and 7% in 1992 and
an expected long-term rate of  return on assets of  9%, were used in  developing
this data. Plan assets were invested in a managed portfolio consisting primarily
of  money market investments,  corporate bonds and  common stock of unaffiliated
issuers.
 
     The following table  sets forth a  reconciliation of funded  status of  the
plans:
 
<TABLE>
<CAPTION>
                                                                                  FEBRUARY 28, 1992
                                                                            ------------------------------
                                                                                     PLANS WHERE
                                                                            ------------------------------
                                                                            ASSETS EXCEED     ACCUMULATED
                                                                             ACCUMULATED       BENEFITS
                                                                              BENEFITS       EXCEED ASSETS
                                                                            -------------    -------------

<S>                                                                         <C>              <C>
                                                                                   (IN THOUSANDS)
Accumulated and projected benefit obligation -- fully vested.............      $(1,975)         $(2,241)
Plan assets at fair value................................................        2,985            1,452
                                                                            -------------    -------------
Projected benefit obligation (in excess of) or less than plan assets.....        1,010             (789)
Unrecognized net loss....................................................          350           --
Unrecognized net asset at transition.....................................         (496)          --
                                                                            -------------    -------------
Prepaid (accrued) pension cost...........................................      $   864          $  (789)
                                                                            -------------    -------------
                                                                            -------------    -------------
</TABLE>
 
     Under  certain union contracts, SEPSCO is  required to make payments to the
union pension funds based upon hours worked by the eligible employees.  Payments
to  the funds amounted to  $915,000 in SEPSCO Fiscal  1991, $819,000 in 1992 and
$784,000 in 1993. Information from the  plan administrators of the funds is  not
available  to permit SEPSCO to determine  its share of unfunded vested benefits,
if any.
 
(13) INCENTIVE COMPENSATION PLANS
 
     At February  28, 1993  SEPSCO maintained  a management  incentive plan.  In
SEPSCO Fiscal 1991 and 1992 SEPSCO recorded provisions of $120,000 and $232,000,
respectively,  in connection with the plan.  No provision was recorded in SEPSCO
Fiscal 1993. Such plan was terminated on April 24, 1993.
 
(14) TRANSACTIONS WITH AFFILIATES
 
     In SEPSCO  Fiscal 1993,  SEPSCO increased  its borrowings  from  Chesapeake
Insurance  by $8,400,000 to $14,043,000. The  additional borrowings were used to
provide the necessary funds to meet SEPSCO's mandatory sinking fund requirements
due February 1, 1993. The loans from Chesapeake Insurance were payable on demand
and bore interest  at an annual  rate of 11  7/8%. In addition  such loans  were
secured  by a pledge of 100% of the  stock of SEPSCO's Public Gas subsidiary. As
described in Note 17, on April 23, 1993 SEPSCO paid in full such loans amounting
to $14,426,000 including $383,000 of accrued interest to Chesapeake Insurance.
 
     In SEPSCO  Fiscal  1992  SEPSCO  purchased  15,000  convertible  redeemable
preferred shares of Chesapeake Insurance for $1,500,000 (see Note 7).
 
                                      F-65
 
<PAGE>
              SOUTHEASTERN PUBLIC SERVICE COMPANY AND SUBSIDIARIES
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
 
     SEPSCO  receives from  Triarc certain management  services including legal,
accounting,  internal  auditing,  insurance,  financial  and  other   management
services. The portion of these costs allocated to SEPSCO was $2,664,000 in 1991,
$2,063,000  in 1992  and $2,033,000  in SEPSCO  Fiscal 1993  (of which $373,000,
$268,000 and $264,000, respectively, was allocated to continuing operations  and
$2,291,000,   $1,795,000   and  $1,769,000,   respectively,  was   allocated  to
discontinued operations).  Additionally,  SEPSCO  was  allocated  certain  costs
representing  uncollectible  amounts  owed  to  Triarc  for  similar  management
services to  certain former  affiliates  of SEPSCO  amounting to  $4,159,000  in
SEPSCO  Fiscal 1991, $849,000 in 1992 and $1,781,000 in 1993 (of which $582,000,
$110,000 and $232,000, respectively, was allocated to continuing operations  and
$3,577,000, $739,000 and $1,549,000, respectively, was allocated to discontinued
operations).  Such amounts are included  in 'Selling, general and administrative
expenses' of continuing operations and  'Loss from discontinued operations,  net
of income taxes' in the accompanying consolidated statements of operations.
 
     SEPSCO,  through Triarc, leases its corporate office space from a trust for
the benefit  of Victor  Posner and  his children.  Rent allocated  by Triarc  to
SEPSCO  amounted to $1,929,000, $1,467,000 and $1,055,000 in SEPSCO Fiscal 1991,
1992  and  1993,  respectively,  (of  which  $270,000,  $191,000  and  $137,000,
respectively,  was allocated to continuing operations and $1,659,000, $1,276,000
and $918,000, respectively, was allocated to discontinued operations).
 
     In addition, SEPSCO incurred interest expense at 18% on unpaid balances due
to Triarc for management services and rent of $533,000, $737,000 and $652,000 in
SEPSCO Fiscal 1991, 1992 and 1993, respectively, (of which $75,000, $96,000  and
$85,000,  respectively,  was allocated  to  continuing operations  and $458,000,
$641,000 and $567,000, respectively, was allocated to discontinued  operations).
At   February  28,  1992  and  1993,  SEPSCO  owed  $2,023,000  and  $2,749,000,
respectively, to Triarc in connection with these arrangements.
 
     Chesapeake Insurance  Company  Limited  ('Chesapeake  Insurance')  provides
certain  insurance coverage and reinsurance of  certain risks to SEPSCO. The net
premium expense incurred  was $8,565,000  in SEPSCO Fiscal  1991, $9,416,000  in
1992  and $10,688,000  in 1993  (of which  $1,093,000, $997,000  and $1,064,000,
respectively, was incurred by  continuing operations and $7,472,000,  $8,419,000
and  $9,624,000,  respectively,  was incurred  by  discontinued  operations). In
addition, Insurance and Risk Management, Inc., an affiliated company until April
23, 1993, acts as agent or broker in connection with insurance coverage obtained
by  SEPSCO  and  provides  claims  processing  services  for  the   discontinued
businesses.  The  commissions  and  payments  incurred  for  such  services were
$508,000,  $528,000  and  $488,000  in  SEPSCO  Fiscal  1991,  1992  and   1993,
respectively, (of which $65,000, $56,000 and $49,000, respectively, was incurred
by  continuing operations and $443,000, $472,000 and $439,000, respectively, was
incurred by discontinued operations).
 
     Certain  machinery  and   automotive  equipment  of   the  continuing   and
discontinued  operations  of SEPSCO  is  leased from  an  indirect, wholly-owned
subsidiary of Triarc. Interest  charges on these  lease obligations amounted  to
$3,886,000  in SEPSCO Fiscal 1991, $3,629,000 in 1992 and $3,156,000 in 1993 (of
which $88,000, $76,000  and $72,000,  respectively, was  incurred by  continuing
operations and $3,798,000, $3,553,000 and $3,084,000, respectively, was incurred
by discontinued operations).
 
(15) LEGAL MATTERS
 
     In  December  1990, a  purported stockholder  derivative suit  (the 'Ehrman
Litigation'), was  brought against  SEPSCO's then  directors and  certain  other
corporations,  including Triarc,  in the  United States  District Court  for the
Southern District of Florida  ('the District Court').  The amended complaint  in
such  action alleges,  among other  things, that  the defendants  breached their
fiduciary duties to  SEPSCO and  RC/Arby's, by  (i) causing  RC/Arby's to  issue
approximately  4.1 million shares  of convertible redeemable  preferred stock to
Triarc for cash and forgiveness of indebtedness of $41,350,000, which  preferred
stock,  upon conversion, resulted initially in Triarc owning approximately 88.7%
of CFC Holdings outstanding voting securities and reduced SEPSCO's ownership  of
such  voting securities from  48% to 5.4%, (ii)  causing Chesapeake Insurance to
suffer large losses in the operations of its business
 
                                      F-66
 
<PAGE>
              SOUTHEASTERN PUBLIC SERVICE COMPANY AND SUBSIDIARIES
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
 

in order to make  RC/Arby's seem less  successful than it  truly was, and  (iii)
causing  the  allegedly unfair  sale  by SEPSCO  in  January 1986  of  shares of
Graniteville's common  stock constituting  approximately 51%  of  Graniteville's
outstanding common stock to Triarc. On April 24, 1993, the Board of Directors of
Triarc approved the terms of a proposed settlement of the Ehrman Litigation (the
'Plaintiff'),  in  accordance  with  the  terms set  forth  in  a  Memorandum of
Understanding dated January 21, 1993 (the 'January Memorandum') entered into  by
DWG  Acquisition  and  the  plaintiff in  the  Ehrman  Litigation.  The proposed
settlement of  the  Ehrman Litigation  contemplated  by the  January  Memorandum
provides,  among other  things, that SEPSCO  would be merged  into, or otherwise
acquired by, Triarc,  or a  subsidiary or  affiliate thereof,  on the  following
terms:  each holder of common stock of  SEPSCO other than Triarc will receive in
exchange for each share of common stock of SEPSCO, .55 shares of Triarc's common
stock $.10 par value per  share (the 'Triarc Class A  Common Stock') and a  note
(or  appropriate  portion  of a  note)  payable  by Triarc  or  SEPSCO  having a
principal amount of $6.00.  As a consequence of  such merger, the SEPSCO  Common
Stock  would be delisted from  the Pacific Stock Exchange  and would be eligible
for termination of registration pursuant to  the Securities and Exchange Act  of
1934.  Triarc or SEPSCO will pay the  reasonable fees and expenses of counsel to
the plaintiff in the action,  as awarded by the  court, and the stockholders  of
SEPSCO will thus receive the merger consideration net of such fees and expenses.
Plaintiff's  counsel will be paid,  subject to court approval,  an amount not to
exceed $650,000 in cash and $650,000 in value of notes (which will be  identical
in  form and substance to the  notes distributed to SEPSCO's stockholders). Such
amount has been accrued by SEPSCO in 1993 and is included in 'Other, expense' in
the accompanying  consolidated  statement  of  operations  for  the  year  ended
February   28,  1993  and  in  'Other  accrued  expenses'  in  the  accompanying
consolidated balance sheet as of February 28, 1993. The settlement of the Ehrman
Litigation is  conditioned on,  among  other things,  approval by  the  District
Court.  As  of  September  1,  1993, SEPSCO  and  the  Plaintiff  in  the Ehrman
Litigation are discussing a modification to  the Memorandum to provide that  the
consideration  to be received would  consist solely of shares  of Triarc Class A
Common Stock based on a  revised exchange ratio which  is yet to be  determined.
Such  revised ratio  is currently expected  to be  .80 shares of  Triarc Class A
Common Stock for each share of SEPSCO Common Stock, although no assurance can be
given that a definitive agreement can be reached as to such matter. Further, the
$1,300,000 to be  paid to  Plaintiff's counsel  would consist  entirely of  cash
rather  than cash and notes. Following  such merger or acquisition, Triarc would
own 100% of SEPSCO Common Stock.

 
     As a  result  of  certain  environmental audits,  SEPSCO  became  aware  of
possible  contamination by hydrocarbons and metals  at certain sites of SEPSCO's
refrigeration operations  and has  filed  appropriate notifications  with  state
environmental authorities and began a study of remediation at such sites. SEPSCO
has removed certain underground storage and other tanks at certain facilities of
its   refrigeration  operations  and  has  engaged  in  certain  remediation  in
connection therewith.  Such removal  and  environmental remediation  involved  a
variety  of remediation  actions at  various facilities  of SEPSCO  located in a
number of jurisdictions. Such remediation varied from site to site ranging  from
testing  of soil and  groundwater for contamination,  development of remediation
plans and removal in certain instances  of certain contaminated soils. Based  on
preliminary   information  and  consultations  with,  and  certain  reports  of,
environmental consultants and  others, SEPSCO  presently estimates  the cost  of
such  remediation and/or removal described  above will approximate $3,661,000 of
which $1,300,000  was provided  in  SEPSCO Fiscal  1991,  $200,000 in  1992  and
$2,161,000  in  1993 included  in 'Other,  net' in  the results  of discontinued
operations above. In connection  therewith SEPSCO has  incurred actual costs  of
$803,000  through February  28, 1993 and  has a remaining  accrual of $2,858,000
included in 'Net non-current assets  of discontinued operations' in the  balance
sheet  above as of February 28, 1993.  SEPSCO believes that its current reserves
for remediation costs are adequate.
 
     SEPSCO  and  its  subsidiaries  are  defendants  in  certain  other   legal
proceedings  arising out of the conduct of  SEPSCO's business. In the opinion of
management and counsel, the ultimate outcome of these legal proceedings will not
have a material adverse effect on the consolidated financial position or results
of operations of SEPSCO.
 
                                      F-67
 
<PAGE>
              SOUTHEASTERN PUBLIC SERVICE COMPANY AND SUBSIDIARIES
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
 
(16) FINANCIAL INSTRUMENTS
 
     As set forth in Note 5, SEPSCO had the Note due from Triarc of  $48,952,000
as of February 28, 1993. On April 23, 1993, SEPSCO received a partial prepayment
of  the principal of the  Note of $22,414,000 and as  such the carrying value of
that portion of the  Note represents fair value.  With respect to the  remaining
$26,538,000  principal amount of  the Note, SEPSCO  estimates that such carrying
value approximates fair value based upon estimated market prices for a  security
with a comparable maturity, interest rate and security of principal.
 
     Based  on current market prices for the 11 7/8% Debentures (see Note 9) and
market interest rates for similar  high yielding securities, the carrying  value
of  such  11 7/8%  Debentures  is considered  to  approximate fair  value  as of
February 28, 1993.
 
(17) OTHER MATTERS AND SUBSEQUENT EVENTS
 
     On April 23, 1993, Victor Posner and entities controlled by him disposed of
all Triarc  Class  A  Common  Stock previously  owned  by  them.  In  connection
therewith,  DWG Acquisition,  a limited  partnership of  which Nelson  Peltz and
Peter W. May are general partners,  acquired 28.6% of Triarc's common stock  and
Victor  Posner  received  5,982,866  shares  of  Triarc's  non-voting redeemable
convertible preferred stock  (the 'Exchange'). Consummation  of the  Acquisition
and  the Exchange resulted  in a change in  control of Triarc  and resulted in a
change in control  of SEPSCO.  In connection with  such change  in control,  the
Board of Directors of SEPSCO was reconstituted and new senior executive officers
were elected.
 
     In  connection  with  the  Acquisition,  Triarc  made  payments aggregating
$27,115,000 on account of principal and interest owed by Triarc on notes held by
SEPSCO. SEPSCO  in turn  used $14,426,000  of the  funds that  it received  from
Triarc  to repay loans owed by SEPSCO to Chesapeake Insurance and $12,689,000 to
repay in full its  then outstanding indebtedness  under its accounts  receivable
financing  arrangement.  In addition  SEPSCO  received $3,535,000  of additional
consideration on the Note from Triarc in the form of offsets of amounts owed  to
Triarc.
 
(18) EVENTS SUBSEQUENT TO DATE OF AUDITORS' REPORT
 
     In  the quarter ended November 30, 1993 SEPSCO recorded a provision for the
estimated loss  on  disposal of  discontinued  operations of  $13,910,000.  Such
provision  was determined  based on  (i) the sale  of the  utility and municipal
services business segment in October 1993, (ii) signing of a letter of intent in
November 1993  to sell  the ice  operations of  SEPSCO's refrigeration  segment,
(iii)  a re-evaluation of the cold storage operations based on preliminary sales
discussions and experience  with respect to  negotiating the sale  of the  other
operations  and (iv) estimated losses from operations  from July 22, 1993 to the
estimated disposal  dates of  the discontinued  operations. See  Note 3  to  the
Southeastern  Public  Service  Company and  subsidiaries  condensed consolidated
financial statements  for the  nine  months ended  November 30,  1993  contained
elsewhere herein for further information.
 
     SEPSCO  previously  reported  the  liquefied petroleum  gas  business  as a
discontinued operation since it is to  be transferred to a subsidiary of  Triarc
and the transfer would be accounted for at net book value. The precise method of
such  transfer has  not been  determined and the  transfer will  not occur until
after the  SEPSCO merger.  Based  on these  facts,  SEPSCO has  reevaluated  the
accounting   for  the   liquefied  petroleum  gas   business  and  retroactively
reclassified the SEPSCO  consolidated financial statements  for the years  ended
February  28 or 29, 1991,  1992 and 1993 to  reflect the liquefied petroleum gas
business as a continuing operation.
 
                                      F-68

<PAGE>
 SOUTHEASTERN PUBLIC SERVICE COMPANY AND SUBSIDIARIES QUARTERLY INFORMATION(a)
                       TWO YEARS ENDED FEBRUARY 28, 1993
                                  (UNAUDITED)
 
<TABLE>
<CAPTION>
                                                                 MAY 31     AUGUST 31    NOVEMBER 30    FEBRUARY 28
                                                                 -------    ---------    -----------    -----------
                                                                      (IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
<S>                                                              <C>        <C>          <C>            <C>
1992:
     Revenues.................................................   $ 7,008     $ 5,132       $ 6,892        $10,188
     Income (loss) from continuing operations before equity in
       cumulative effect of changes in accounting principles
       and extraordinary items................................    (1,186)      1,415           734          5,369
     Income (loss) from discontinued operations...............     1,273       1,869          (174)        (3,193)
     Net income...............................................        87       3,284           560          2,176
     Income (loss) per share:
          Continuing operations...............................      (.10)        .12           .06            .46
          Discontinued operations.............................       .11         .16          (.01)          (.28)
          Net income..........................................       .01         .28           .05            .18
1993:
     Revenues.................................................   $ 7,165     $ 5,132       $ 6,647        $ 9,576
     Income from continuing operations before equity in
       cumulative effect of changes in accounting principles
       and extraordinary items................................     2,324       1,815         3,227          5,206(b)
     Income (loss) from discontinued operations...............      (579)      1,143           374         (6,480)(c)
     Equity in cumulative effect of changes in accounting
       principles of affiliate, net of taxes..................    (5,954)(d)    --          --             --
     Equity in extraordinary items of affiliate...............     --          --           --               (348)
     Net income (loss)........................................    (4,209)(d)    2,958        3,601         (1,622)(b&c)
     Income (loss) per share:
          Continuing operations...............................       .20         .15           .28            .45(b)
          Discontinued operations.............................      (.05)        .10           .03           (.56)(c)
          Cumulative effect of changes in accounting
            principles of affiliate...........................      (.51)(d)    --          --             --
          Extraordinary items of affiliate....................     --          --           --               (.03)
          Net income (loss)...................................      (.36)(d)      .25          .31           (.14)(b&c)
</TABLE>
 
- ------------
 
 (a) Quarterly  information  has  been  retroactively  restated  to  reflect the
     discontinuance of utility and municipal services, refrigeration and natural
     gas and oil operations in 1993.
 
 (b) Includes recognition of a deferred gain from sale of marketable security of
     $6,000,000 and  a  $1,300,000  provision  for  the  settlement  of  certain
     litigation.
 
 (c) Includes  a provision for  anticipated losses on  construction contracts in
     progress of $1,608,000  and other  fourth quarter  adjustments of  $820,000
     related  to net realizable value of oil and gas properties and plugging and
     abandonment of  wells. Includes  a $375,000  provision for  settlements  of
     certain litigation and a $2,100,000 provision for environmental costs.
 
 (d) Graniteville  adopted SFAS 109 and SFAS  106 in fiscal 1993. The cumulative
     effect of  such changes  in accounting  principles has  been  retroactively
     reflected  in the May  31, 1992 quarterly  information presented above. Net
     income previously reported in Form 10-Q was $1,745,000 and income per share
     was $.15.
 
                                      F-69

<PAGE>
 
              SOUTHEASTERN PUBLIC SERVICE COMPANY AND SUBSIDIARIES
                     CONDENSED CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
                                                                                        FEBRUARY 28,    NOVEMBER 30,
                                                                                            1993            1993
                                                                                        ------------    ------------
                                                                                               (IN THOUSANDS)
                                                                                            (A)         (UNAUDITED)
<S>                                                                                     <C>             <C>
                                       ASSETS
Current assets:
     Cash and equivalents............................................................     $    239        $ 35,847
     Restricted cash and equivalents.................................................        5,264           5,264
     Receivables, net................................................................        3,971           3,884
     Finished goods inventories......................................................          733             888
     Notes receivable from Triarc (less unamortized deferred discount of $39)........       25,047          --
     Deferred income tax benefit.....................................................       --               1,062
     Other current assets............................................................        1,386             534
     Net current assets of discontinued operations...................................        1,987          --
                                                                                        ------------    ------------
          Total current assets.......................................................       38,627          47,479
Properties, net......................................................................        7,825           7,298
Note receivable from Triarc..........................................................       26,538          26,538
Investments in affiliates............................................................       65,327          68,033
Deferred income tax benefit..........................................................       --                 528
Other assets.........................................................................        1,752           2,483
Net non-current assets of discontinued operations....................................       66,184          18,771
                                                                                        ------------    ------------
                                                                                          $206,253        $171,130
                                                                                        ------------    ------------
                                                                                        ------------    ------------
                        LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
     Current portion of long-term debt...............................................     $  9,312        $  9,287
     Notes payable to affiliate......................................................       14,043          --
     Accounts receivable financing...................................................        9,536          --
     Accounts payable................................................................        2,249           8,690
     Other accrued expenses..........................................................        4,624           4,190
     Net current liabilities of discontinued operations..............................       --               3,406
                                                                                        ------------    ------------
          Total current liabilities..................................................       39,764          25,573
Long-term debt (less unamortized deferred discount of $5,282 and $4,312).............       49,661          50,501
Deferred income taxes................................................................        7,230          --
Other liabilities....................................................................        1,368           1,484
Commitments and contingencies
Stockholders' equity:
     Preferred stock.................................................................           24              24
     Common stock....................................................................       11,896          11,896
     Additional paid-in capital......................................................       90,539          90,539
     Retained earnings (accumulated deficit).........................................        6,637          (8,021)
     Treasury stock..................................................................         (866)           (866)
                                                                                        ------------    ------------
          Total stockholders' equity.................................................      108,230          93,572
                                                                                        ------------    ------------
                                                                                          $206,253        $171,130
                                                                                        ------------    ------------
                                                                                        ------------    ------------
</TABLE>
 
- ------------
 
 (A) The  balance  sheet at  February  28, 1993  has  been derived  from audited
     financial statements at that date.
 
     See accompanying notes to condensed consolidated financial statements.
 
                                      F-70
 
<PAGE>
              SOUTHEASTERN PUBLIC SERVICE COMPANY AND SUBSIDIARIES
                CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
 
<TABLE>
<CAPTION>
                                                                                                 FOR THE NINE
                                                                                                 MONTHS ENDED
                                                                                                  NOVEMBER 30
                                                                                              -------------------
                                                                                               1992        1993
                                                                                              -------    --------
                                                                                                 (IN THOUSANDS
                                                                                                EXCEPT FOR PER
                                                                                                SHARE AMOUNTS)
                                                                                                  (UNAUDITED)
<S>                                                                                           <C>        <C>
Net sales..................................................................................   $18,944    $ 19,760
                                                                                              -------    --------
Costs and expenses:
     Cost of sales.........................................................................    15,783      16,408
     Selling, general and administrative expenses..........................................     1,456       2,998
                                                                                              -------    --------
                                                                                               17,239      19,406
                                                                                              -------    --------
          Operating profit.................................................................     1,705         354
                                                                                              -------    --------
Other income (expense):
     Interest expense......................................................................    (9,810)     (7,521)
     Equity in earnings of affiliates before cumulative effect of changes in accounting
      principles...........................................................................     9,647       4,310
     Write-off of investment in Chesapeake Insurance Company, Ltd..........................     --         (1,500)
     Interest income from Triarc...........................................................     5,507       3,141
     Other, net............................................................................       147         608
                                                                                              -------    --------
                                                                                                5,491        (962)
                                                                                              -------    --------
     Income (loss) from continuing operations before income taxes and cumulative effect of
      changes in accounting principles.....................................................     7,196        (608)
Benefit from income taxes..................................................................       170       1,791
                                                                                              -------    --------
     Income from continuing operations before cumulative effect of changes in accounting
      principles...........................................................................     7,366       1,183
Income (loss) from discontinued operations.................................................       938     (23,355)
                                                                                              -------    --------
     Income (loss) before cumulative effect of changes in accounting principles............     8,304     (22,172)
Cumulative effect of changes in accounting principles:
     The Company...........................................................................     --          7,617
     Equity in affiliates..................................................................    (5,954)       (102)
                                                                                              -------    --------
     Net income (loss).....................................................................   $ 2,350    $(14,657)
                                                                                              -------    --------
                                                                                              -------    --------
Income (loss) per share:
     Continuing operations.................................................................   $   .63    $    .10
     Discontinued operations...............................................................       .08       (2.00)
     Cumulative effect of changes in accounting principles.................................      (.51)        .64
                                                                                              -------    --------
     Net income (loss).....................................................................   $   .20    $  (1.26)
                                                                                              -------    --------
                                                                                              -------    --------
</TABLE>
 
     See accompanying notes to condensed consolidated financial statements.
 
                                      F-71
 
<PAGE>
              SOUTHEASTERN PUBLIC SERVICE COMPANY AND SUBSIDIARIES
                CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                  (UNAUDITED)
 
<TABLE>
<CAPTION>
                                                                                                  FOR THE NINE
                                                                                                  MONTHS ENDED
                                                                                                  NOVEMBER 30,
                                                                                               -------------------
                                                                                                1992        1993
                                                                                               -------    --------
                                                                                                 (IN THOUSANDS)
<S>                                                                                            <C>        <C>
Cash flows from operating activities:
     Net income (loss)......................................................................   $ 2,350    $(14,657)
     Adjustments to reconcile net income (loss) to net cash provided by (used in) operating
      activities:
          Depreciation......................................................................       922         908
          Amortization of deferred financing costs and debt discount........................     1,038         968
          Amortization of deferred discount on notes receivable from Triarc.................       (72)        (39)
          Write-off of investment in Chesapeake Insurance Company Limited...................     --          1,500
          Equity in earnings of affiliates before cumulative effect of changes in accounting
           principles.......................................................................    (9,647)     (4,310)
          Loss (income) from discontinued operations........................................      (938)     23,355
          Dividend from unconsolidated affiliate............................................     3,004       --
          Cumulative effect of changes in accounting principles.............................     5,954      (7,515)
          Decrease in deferred income taxes.................................................    (2,922)     (7,569)
          Other, net........................................................................       774       2,350
          Changes in operating assets and liabilities:
               Decrease (increase) in receivables...........................................     1,260         (70)
               Decrease (increase) in inventories...........................................       115        (155)
               Decrease in notes receivable from Triarc.....................................     5,873       --
               Decrease (increase) in other current assets..................................    (1,443)        852
               Increase (decrease) in accounts payable......................................      (687)      2,826
               Increase (decrease) in other accrued expenses................................     2,869        (434)
                                                                                               -------    --------
                    Net cash provided by (used in) operating activities.....................     8,450      (1,990)
                                                                                               -------    --------
Cash flows from investing activities:
     Proceeds from sales of subsidiaries....................................................     --         43,002
     Capital expenditures...................................................................      (443)       (317)
     Other..................................................................................        52         375
                                                                                               -------    --------
          Net cash provided by (used in) investing activities...............................      (391)     43,060
                                                                                               -------    --------
Cash flows from financing activities:
     Debt repayments........................................................................      (247)    (23,579)
     Collection of notes receivable from Triarc.............................................     --         25,379
     Net proceeds from accounts receivable financing........................................      (990)      --
                                                                                               -------    --------
          Net cash provided (used in) financing activities..................................    (1,237)      1,800
                                                                                               -------    --------
Net cash provided by continuing operations..................................................     6,822      42,870
Net cash used in discontinued operations....................................................    (4,662)     (7,262)
                                                                                               -------    --------
Net increase in cash........................................................................     2,160      35,608
Cash at beginning of period.................................................................       282         239
                                                                                               -------    --------
Cash at end of period.......................................................................   $ 2,442    $ 35,847
                                                                                               -------    --------
                                                                                               -------    --------
</TABLE>
 
     See accompanying notes to condensed consolidated financial statements.
 
                                      F-72

<PAGE>
              SOUTHEASTERN PUBLIC SERVICE COMPANY AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                               NOVEMBER 30, 1993
                                  (UNAUDITED)
 
1. BASIS OF PRESENTATION
 
     Southeastern  Public Service Company and subsidiaries ('SEPSCO') is a 71.1%
owned subsidiary of Triarc Companies, Inc. ('Triarc', formerly DWG Corporation).
 
     The accompanying unaudited condensed  consolidated financial statements  of
SEPSCO  have  been prepared  in  accordance with  Rule  10-01 of  Regulation S-X
promulgated by the  Securities and  Exchange Commission and,  therefore, do  not
include  all  information and  footnotes necessary  for  a fair  presentation of
financial position,  results of  operations and  cash flows  in conformity  with
generally accepted accounting principles. In the opinion of SEPSCO, however, the
accompanying   condensed   consolidated   financial   statements   contain   all
adjustments, consisting of normal recurring adjustments and certain  significant
charges  as discussed  in Notes  2 and 3,  necessary to  present fairly SEPSCO's
financial position as of February 28, 1993 and November 30, 1993, its results of
operations for the nine-month periods ended  November 30, 1992 and 1993 and  its
cash  flows for the  nine-month periods ended  November 30, 1992  and 1993. This
information should  be  read  in conjunction  with  the  consolidated  financial
statements  and notes thereto included in the  SEPSCO annual report on Form 10-K
for the year ended February 28, 1993.
 
     On October 27, 1993  SEPSCO's Board of Directors  approved a change in  the
fiscal  year of SEPSCO ending February 28 to a calendar year ending December 31,
effective for  the  ten-month  period ending  December  31,  1993.  Graniteville
Company  ('Graniteville'), a 49% owned investment,  also changed its fiscal year
to a calendar year ending December 31. SEPSCO plans to issue a transition report
on Form 10-K for the ten-month period  ended December 31, 1993. As used  herein,
'SEPSCO  Fiscal 1993'  refers to  the year ended  February 28,  1993 and 'SEPSCO
Transition 1993' refers to the ten months ended December 31, 1993.
 
2. SIGNIFICANT CHARGES IN THE FIRST SIX MONTHS OF SEPSCO TRANSITION 1993
 
     The accompanying condensed consolidated statement of operations include the
following significant  charges  recorded  in  the first  six  months  of  SEPSCO
Transition 1993 (in thousands):
 
<TABLE>
<S>                                                                                               <C>
Estimated cost allocated to SEPSCO by Triarc to terminate the lease on Triarc's existing          $2,840
  corporate facilities.........................................................................
Costs allocated to SEPSCO by Triarc related to a five-year consulting agreement extending          1,374
  through April 1998 between Triarc and the former Vice Chairman of Triarc.....................
Estimated cost to relocate SEPSCO's corporate office...........................................      500
                                                                                                  ------
     Corporate restructuring charges (a).......................................................    4,714(1)
Estimated cost allocated to SEPSCO by Triarc for compensation paid to the Triarc Special             625(2)
  Committee of the Board of Directors of Triarc(b).............................................
Write-down of certain unprofitable properties(c)...............................................    8,000(3)
Income tax benefit relating to the above charges...............................................   (4,523)(4)
Provision for income tax contingencies and other income tax matters............................      600(5)
Equity in significant charges of affiliates, net of taxes(d)...................................    2,260
Cumulative effect of changes in accounting principles(Note 7)..................................   (7,515)
                                                                                                  ------
                                                                                                  $4,161
                                                                                                  ------
                                                                                                  ------
</TABLE>
 
- ------------
 
(1) $782,000  included  in  'Selling, general  and  administrative  expenses' of
    continuing  operations  and  $3,932,000  included  in  'Income  (loss)  from
    discontinued operations.'
 
                                              (footnotes continued on next page)
 
                                      F-73
 
<PAGE>
              SOUTHEASTERN PUBLIC SERVICE COMPANY AND SUBSIDIARIES
      NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
 
(footnotes continued from previous page)
 
(2) $104,000  included  in  'Selling, general  and  administrative  expenses' of
    continuing  operations  and  $521,000   included  in  'Income  (loss)   from
    discontinued operations.'
 
(3) Included in 'Income (loss) from discontinued operations.'
 
(4) $(301,000)  included in 'Benefit from income taxes' of continuing operations
    and $(4,222,000) included in 'Income (loss) from discontinued operations.'
 
(5) $100,000 included in  'Benefit from income  taxes' of continuing  operations
    and $500,000 included in 'Income (loss) from discontinued operations.'
 
 (a) In the first quarter of SEPSCO Transition 1993, net of adjustments recorded
     during  the second quarter of SEPSCO Transition 1993, results of operations
     were  significantly  impacted  by   facilities  relocation  and   corporate
     restructuring  charges aggregating  $4,714,000 consisting  of $4,214,000 of
     charges allocated  to SEPSCO  by Triarc:  (i) estimated  allocated cost  of
     $2,840,000  to terminate  the lease  on its  existing corporate facilities;
     (ii) total allocated costs of $1,374,000 relating to a five-year consulting
     agreement (the 'Consulting Agreement') extending through April 1998 between
     Triarc and Steven  Posner, the  former Vice  Chairman of  Triarc and  (iii)
     $500,000  of estimated costs to be  incurred by SEPSCO to relocate SEPSCO's
     corporate office. All of such charges are related to the Change in  Control
     described  in  Note 5.  In connection  with the  Change in  Control, Victor
     Posner and Steven Posner resigned as  officers and directors of Triarc.  In
     order to induce Steven Posner to resign, Triarc entered into the Consulting
     Agreement  with him. The allocated cost related to the Consulting Agreement
     was recorded as  a charge in  the first quarter  of SEPSCO Transition  1993
     because  the Consulting Agreement does not require any substantial services
     and SEPSCO and Triarc do not expect to receive any services that will  have
     substantial  value to  them. As  a part the  Change in  Control, the Triarc
     Board  of  Directors   was  reconstituted.   The  first   meeting  of   the
     reconstituted Triarc Board of Directors was held on April 24, 1993. At that
     meeting, based on a report and recommendations from a management consulting
     firm  that had conducted an extensive review of Triarc and its subsidiaries
     operations and management structure, the Triarc Board of Directors approved
     a plan of  decentralization and restructuring  which entailed, among  other
     things, the following features: (i) the strategic decision to manage Triarc
     in  the future on a decentralized rather  than on a centralized basis; (ii)
     the hiring of new executive officers for Triarc; (iii) the termination of a
     significant number of  employees as  a result  of both  the new  management
     philosophy  and the  hiring of an  almost entirely new  management team and
     (iv) the relocation of Triarc and certain subsidiaries, including  SEPSCO's
     corporate  headquarters. SEPSCO's allocated cost  to terminate the lease on
     Triarc's  existing  corporate  facilities  ($2,840,000)  and  the  cost  to
     relocate  SEPSCO's headquarters  all stemmed from  the decentralization and
     restructuring plan formally adopted  at the April 24,  1993 meeting of  the
     reconstituted  Triarc Board of Directors  and accordingly, were recorded in
     the first quarter of SEPSCO Transition 1993.
 
 (b) In accordance with certain court proceedings and related settlements,  five
     directors,  including  three court-appointed  directors, were  appointed in
     1991 to serve on  a special committee (the  'Triarc Special Committee')  of
     Triarc's  Board of  Directors. Such committee  was empowered  to review and
     pass on transactions  between Triarc  and Victor Posner,  the then  largest
     shareholder of Triarc, and his affiliates. SEPSCO has been charged $625,000
     as an allocation of the cash portion of a success fee payable to the Triarc
     Special  Committee attributable to the closing of the Triarc reorganization
     and the resulting Change in Control.
 
 (c) Represents write-downs  in  the  carrying  value  of  certain  unprofitable
     properties   reflecting  their   estimated  impairment   as  a   result  of
     management's re-evaluation of such assets.
 
 (d) SEPSCO's equity in  significant charges  recorded in the  first quarter  of
     SEPSCO  Transition  1993, net  of  adjustments recorded  during  the second
     quarter of SEPSCO Transition 1993, which were
 
                                              (footnotes continued on next page)
 
                                      F-74
 
<PAGE>
              SOUTHEASTERN PUBLIC SERVICE COMPANY AND SUBSIDIARIES
      NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
 
(footnotes continued from previous page)
    allocated by Triarc to Graniteville and CFC Holdings Corp. ('CFC Holdings'),
     a 5.4%  owned investment  and  a subsidiary  of  Triarc, is  summarized  as
     follows (in thousands):
 
<TABLE>
<CAPTION>
                                                                                                     CFC
                                                                                   GRANITEVILLE    HOLDINGS    TOTAL
                                                                                   ------------    --------    ------
<S>                                                                                <C>             <C>         <C>
Estimated cost allocated to the affiliates by Triarc to terminate the lease on
  Triarc's existing corporate headquarters(a)...................................      $  790        $  382     $1,172
Total cost allocated to the affiliates related to the Consulting Agreement(a)...         112            79        191
Estimated cost allocated to the affiliates for compensation paid to the Triarc
  Special Committee(b)..........................................................         813            97        910
Affiliate's facilities relocation and corporate restructuring...................      --               544        544
Other...........................................................................      --               419        419
Less income tax benefit on the above items......................................        (577)         (399)      (976)
                                                                                   ------------    --------    ------
                                                                                      $1,138        $1,122     $2,260
                                                                                   ------------    --------    ------
                                                                                   ------------    --------    ------
</TABLE>
 
3. DISCONTINUED OPERATIONS
 
     On  July  22,  1993 SEPSCO's  Board  of  Directors authorized  the  sale or
liquidation of its utility and municipal services, refrigeration and natural gas
and oil businesses. Accordingly, SEPSCO has presented the accompanying condensed
consolidated financial statements for each of the periods shown to reflect  such
businesses  as  discontinued operations  through  July 22,  1993.  The operating
results of the  discontinued operations subsequent  to July 22,  1993 have  been
deferred   and  are  included  in   'Net  current  liabilities  of  discontinued
operations'. On December 9, 1993 SEPSCO's Board of Directors decided the natural
gas and oil business will be transferred to Triarc rather than SEPSCO selling it
to an independent third party.  Such transfer will be in  the form of a sale  of
the  stock of the entities comprising the  natural gas and oil business for cash
of $8,500,000 which is  equal to their fair  value and approximately  $4,500,000
higher  than  their  net book  value.  It is  intended  for this  sale  to occur
following the Merger and the resulting  elimination of the minority interest  in
SEPSCO  (Note  9). However  should  the Merger  not  be approved  by  the SEPSCO
stockholders (Note 9) the sale of the stock of the natural gas and oil  entities
for cash to Triarc will be completed prior to July 22, 1994.
 
     On October 15, 1993 SEPSCO sold the assets of its tree maintenance services
operations  previously included in  its utility and  municipal services business
segment for  $69,600,000  in  cash  plus the  assumption  by  the  purchaser  of
$5,000,000  in current liabilities resulting in a loss of $4,771,000. On October
7, 1993  SEPSCO  sold the  stock  of  its two  construction  related  operations
previously included in its utility and municipal services business segment for a
nominal amount subject to adjustments described below. As the related assets are
sold  or  liquidated the  purchasers have  agreed to  pay, as  deferred purchase
price, 75% of the net proceeds  received therefrom (cash of $1,515,000 has  been
received  as of November  30, 1993) plus, in  the case of the  larger of the two
entities, an amount equal to 1.25 times  the adjusted book value of such  entity
as  of October 5, 1995 (the 'Book Value Adjustment'). As of October 7, 1993, the
adjusted book  value  of the  assets  of that  entity  aggregated  approximately
$1,600,000.  In addition, SEPSCO paid $2,000,000 in October and November 1993 to
cover the buyer's short-term operating  losses and working capital  requirements
for  the  construction  related  operations.  As  of  November  30,  1993 SEPSCO
estimated the sales  of the construction  related operations would  result in  a
gain  of  $2,030,000 excluding  any consideration  of  the potential  Book Value
Adjustment. In January  1994, however,  SEPSCO learned  that the  buyer of  such
businesses  had successfully  negotiated extensions  of certain  major contracts
with respect to the larger of such businesses and as a result no longer  intends
to immediately dispose of the major portion of the assets. Should the buyer hold
such  assets through  October 5, 1995,  the purchase price  would effectively be
realized through the Book Value Adjustment.  Based on such revised estimates  of
asset sales, SEPSCO would approximately break-
 
                                      F-75
 
<PAGE>
              SOUTHEASTERN PUBLIC SERVICE COMPANY AND SUBSIDIARIES
      NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
 
even  excluding any consideration of the  potential Book Value Adjustment, given
its uncertainty. The charge to discontinued operations during the third  quarter
of  SEPSCO  Transition  1993  (see  second  following  paragraph)  reflects such
estimated break even on the disposal of the construction related operations.
 
     On November 12, 1993 SEPSCO signed a letter of intent to sell substantially
all of the operating assets of the ice operations of its refrigeration  business
segment  for $5,000,000 in cash, a $4,000,000 note (discounted value $3,101,000)
and the  assumption by  the buyer  of certain  current liabilities  which as  of
November  30,  1993  would  approximate $1,000,000.  The  note,  which  bears no
interest  during  the  first  year  and  5%  thereafter,  would  be  payable  in
installments  of $120,000  at the end  of each  of the four  years following the
closing date with the  balance of $3,520,000  due at the end  of the fifth  year
following  the closing date. The precise  timetable for the sale and liquidation
of the remaining discontinued operation, the cold storage operations of SEPSCO's
refrigeration business segment,  will depend upon  SEPSCO's ability to  identify
appropriate  potential purchasers and to negotiate acceptable terms for the sale
of such operation. SEPSCO currently anticipates completion of such sales by July
31, 1994.
 
     On July 22, 1993  SEPSCO's Board of Directors  also authorized the sale  or
liquidation  of the liquefied petroleum gas business. SEPSCO previously reported
the liquefied petroleum gas business as a discontinued operation since it is  to
be transferred to a subsidiary of Triarc and the transfer would be accounted for
at  net book value. The precise method  of such transfer has not been determined
and the transfer will not  occur until after the  Merger. Based on these  facts,
SEPSCO  has reevaluated the accounting for  the liquefied petroleum gas business
and retroactively  restated  the  SEPSCO consolidated  financial  statements  to
reflect  the liquefied  petroleum gas business  as a continuing  operation. As a
result, for the nine  months ended November 30,  1993, SEPSCO has (i)  increased
the loss from discontinued operations by $2,909,000 (included in the $13,910,000
in   the  following  paragraph)  representing  the  estimated  net  income  from
operations of the liquefied petroleum gas business from the measurement date  to
the  expected  date of  disposition  which had  previously  been used  to offset
operating losses of other discontinued operations for the same periods and  (ii)
decreased  the  loss from  continuing  operations by  $572,000  representing the
income from the liquefied  petroleum gas business from  the measurement date  to
November 30, 1993.
 
     In  connection with the  consummation of the sales  of the tree maintenance
services operations and the construction  related activities and the signing  of
the  letter  of  intent  to  sell the  ice  operations  discussed  above, SEPSCO
reevaluated the  estimated  gain or  loss  from  the sale  of  its  discontinued
operations  and provided $13,910,000 for the  revised estimated loss on the sale
of the  discontinued operations  from an  estimated break  even position  as  of
August  31, 1993.  The revised estimate  principally reflects  (i) $4,700,000 of
losses from the  sales of the  operations comprising the  utility and  municipal
services  business segment previously estimated  to be approximately break even,
(ii) $6,600,000  of  losses from  the  sale of  operations  comprising  SEPSCO's
refrigeration  business segment previously estimated to  be a gain of $1,600,000
and (iii) $2,500,000 of estimated losses  from operations from July 22, 1993  to
the  actual or estimated disposal dates  of the discontinued operations and (iv)
less previously estimated  losses of $1,500,000  from the sale  of the stock  of
SEPSCO's  natural gas and  oil businesses which  now will be  sold to Triarc for
cash. Since such sale will be to a company which is within a controlled group it
will be accounted  for at  net book value.  The net  loss from the  sale of  the
utility  and  municipal  services  business  segment  reflects  a  reduction  of
$2,030,000 due  to  a  decrease  in asset  sales  of  the  construction  related
activities  by July 31, 1994,  a reduction of $1,800,000  in the estimated sales
price for the construction related operations from previous estimates and  other
adjustments  in finalizing the loss on the sale of the tree maintenance services
operations. The $8,200,000  change relating  to the sales  of the  refrigeration
business  segment principally  results from  (i) a  $4,000,000 reduction  in the
sales price for  the ice operations  based on the  letter of intent  and (ii)  a
$4,000,000 reduction in the estimated sales price of the cold storage operations
based   on  preliminary  sales  discussions   and  experience  with  respect  to
negotiating the sale of the other operations.
 
                                      F-76
 
<PAGE>
              SOUTHEASTERN PUBLIC SERVICE COMPANY AND SUBSIDIARIES
      NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
 
     Based on the analysis  performed to date, after  taking into account (i)  a
$4,900,000  pre-tax  write-down  in the  fourth  quarter of  SEPSCO  Fiscal 1993
relating to  accruals  for  environmental  remediation  and  losses  on  certain
contracts  in progress,  (ii) a $8,000,000  pre-tax provision  for impairment of
certain unprofitable properties in the  first quarter of SEPSCO Transition  1993
reflected in operating profit (loss) of discontinued operations summarized below
and  (iii) the  charge to  discontinued operations  of $13,910,000  taken in the
three  months  ended  November  30,  1993  SEPSCO  expects  that  all  remaining
dispositions,  including the results  of their operations  through the actual or
anticipated disposal dates, will not in  the aggregate result in any  additional
material loss to SEPSCO.
 
     The  income (loss) from discontinued  operations consisted of the following
(in thousands):
 
<TABLE>
<CAPTION>
                                                                                                 NINE MONTHS
                                                                                                    ENDED
                                                                                                 NOVEMBER 30,
                                                                                    --------------------------------------
                                                                                          1992                 1993
                                                                                    -----------------    -----------------
                                                                                                (IN THOUSANDS)
<S>                                                                                 <C>                  <C>
Income (loss) from operations of discontinued operations net of income taxes
  (benefit) of $460 and $(3,830).................................................         $938              $ (9,445)
Loss on disposal of discontinued operations without income tax benefit...........       --                   (13,910)
                                                                                         ------          -----------------
                                                                                          $938              $(23,355)
                                                                                         ------          -----------------
                                                                                         ------          -----------------
</TABLE>
 
                                      F-77
 
<PAGE>
              SOUTHEASTERN PUBLIC SERVICE COMPANY AND SUBSIDIARIES
      NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
 
     The income (loss)  from discontinued  operations up  to the  July 22,  1993
measurement date and the loss from operations during the period of July 23, 1993
to November 30, 1993, consisted of the following:
 
<TABLE>
<CAPTION>
                                         NINE MONTHS ENDED NOVEMBER  MARCH 1, 1993 TO JULY 22,   JULY 23, 1993 TO NOVEMBER
                                                  30, 1992                      1993                      30, 1993
                                         --------------------------  --------------------------  --------------------------
                                                       UTILITY AND                 UTILITY AND                 UTILITY AND
                                                        MUNICIPAL                   MUNICIPAL                   MUNICIPAL
                                         NATURAL GAS  SERVICES AND   NATURAL GAS  SERVICES AND   NATURAL GAS  SERVICES AND
                                           AND OIL    REFRIGERATION    AND OIL    REFRIGERATION    AND OIL    REFRIGERATION
                                         -----------  -------------  -----------  -------------  -----------  -------------
                                                                           (IN THOUSANDS)
<S>                                      <C>          <C>            <C>          <C>            <C>          <C>
Operating revenues:
     Net sales.......................... $   3,547    $      9,261   $   2,111    $      5,943   $   1,645    $      2,923
     Service revenues...................    --             145,696      --              75,502      --              42,585
                                         -----------  -------------  -----------  -------------  -----------  -------------
                                             3,547         154,957       2,111          81,445       1,645          45,508
                                         -----------  -------------  -----------  -------------  -----------  -------------
Operating costs and expenses:
     Cost of sales......................     2,198           8,425       1,194           5,207         908           3,134
     Cost of services...................    --             132,192      --              70,922      --              40,566
     Selling, general and administrative
       expenses.........................     1,232           8,806       1,451           4,439         987           4,638
     Write-down of certain unprofitable
       properties (Note 2)..............    --             --           --               8,000      --             --
     Facilities relocation and corporate
       restructuring (Note 2)...........    --             --              161           3,772      --             --
                                         -----------  -------------  -----------  -------------  -----------  -------------
                                             3,430         149,423       2,806          92,340       1,895          48,338
                                         -----------  -------------  -----------  -------------  -----------  -------------
     Operating profit (loss)............       117           5,534        (695)        (10,895)       (250)         (2,830)
                                         -----------  -------------  -----------  -------------  -----------  -------------
Other income (expense):
     Interest expense...................        (7)         (2,783)         (3)         (1,288)         (1)           (613)
     Other, net.........................        39          (1,502)        108            (502)         47             (79)
                                         -----------  -------------  -----------  -------------  -----------  -------------
                                                32          (4,285)        105          (1,790)         46            (692)
                                         -----------  -------------  -----------  -------------  -----------  -------------
     Income (loss) before income
       taxes............................       149           1,249        (590)        (12,685)       (204)         (3,522)
Benefit from (provision for) income
  taxes.................................       (45)           (415)        258           3,572        (148)            440
                                         -----------  -------------  -----------  -------------  -----------  -------------
     Net income (loss).................. $     104    $        834   $    (332) $       (9,113) $     (352) $       (3,082)
                                         -----------  -------------  -----------  -------------  -----------  -------------
                                         -----------  -------------  -----------  -------------  -----------  -------------
</TABLE>
 
                                      F-78
 
<PAGE>
              SOUTHEASTERN PUBLIC SERVICE COMPANY AND SUBSIDIARIES
      NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
 
     Net  current assets  (liabilities) and  non-current assets  of discontinued
operations consist of the following:
 
<TABLE>
<CAPTION>
                                                                 FEBRUARY 28, 1993               NOVEMBER 30, 1993
                                                            ----------------------------    ----------------------------
                                                                            UTILITY AND                     UTILITY AND
                                                                             MUNICIPAL                       MUNICIPAL
                                                            NATURAL GAS    SERVICES AND     NATURAL GAS    SERVICES AND
                                                              AND OIL      REFRIGERATION      AND OIL      REFRIGERATION
                                                            -----------    -------------    -----------    -------------
                                                                                   (IN THOUSANDS)
<S>                                                         <C>            <C>              <C>            <C>
Cash.....................................................    $  --           $ --            $  --           $     189
Receivables..............................................          365          26,313             242           1,596
Inventories..............................................          160           2,894             159             677
Deferred income tax benefit..............................       --                  --           1,137             930
Other current assets.....................................           40           1,939              51             559
Current portion of long-term debt........................       --                (349)         --             --
Current portion of capitalized leases due to leasing
  affiliate..............................................          (25)        (10,245)            (57)           (448)
Accounts payable.........................................         (287)         (8,693)           (315)         (1,284)
Due to Triarc............................................       --             --                 (242)           (988)
Accrued salaries and wages...............................          (29)         (2,800)         --             --
Accrued expenses.........................................         (879)         (6,417)         (1,083)         (4,529)
                                                            -----------    -------------    -----------    -------------
Net current assets (liabilities) of discontinued
  operations.............................................    $    (655)      $   2,642       $    (108)      $  (3,298)
                                                            -----------    -------------    -----------    -------------
                                                            -----------    -------------    -----------    -------------
Properties, net..........................................    $   7,404       $  84,476       $   7,289       $  18,034
Other assets.............................................           29           1,083              55             296
Long-term debt...........................................       --                (172)         --                 (17)
Capitalized leases due to leasing affiliate..............          (21)        (16,799)            (17)           (243)
Deferred income taxes....................................       (1,303)         (5,162)         (1,847)         (1,810)
Other liabilities........................................         (304)         (3,047)           (304)         (2,665)
                                                            -----------    -------------    -----------    -------------
Net non-current assets of discontinued operations........    $   5,805       $  60,379       $   5,176       $  13,595
                                                            -----------    -------------    -----------    -------------
                                                            -----------    -------------    -----------    -------------
</TABLE>
 
4. WRITE-OFF OF INVESTMENT
 
     SEPSCO had a  $1,500,000 investment  in the preferred  stock of  Chesapeake
Insurance   Company  Limited  ('Chesapeake  Insurance'),  a  subsidiary  of  CFC
Holdings, and Graniteville had a $2,500,000 investment in such preferred  stock.
During  its quarter ended September 30,  1993 Chesapeake Insurance increased its
reserve for  insurance  and reinsurance  losses  by $10,000,000  and  as  result
reduced  the  stockholders'  equity  of  Chesapeake  Insurance  to  $308,000. In
December 1993 Triarc decided to cease  writing insurance and reinsurance of  any
kind  through Chesapeake  Insurance. As a  result Chesapeake  Insurance will not
have any future operating  cash flows and  its remaining liabilities,  including
payment  of  claims on  insurance previously  written,  will be  liquidated with
assets on hand. Accordingly, the  preferred stock investment is not  recoverable
and  SEPSCO and Graniteville wrote-off their  investment in such stock since the
decline in value was deemed to be other than temporary.
 
5. CHANGE IN CONTROL
 
     As previously reported,  a change  in control of  SEPSCO's parent,  Triarc,
occurred  on April 23, 1993, which as a result of Triarc's ownership of SEPSCO's
voting securities constituted  a change  in control  of SEPSCO  (the 'Change  in
Control').  In connection with the Change in  Control, the Board of Directors of
SEPSCO was reconstituted and new senior executive officers were elected.
 
     In connection therewith,  SEPSCO received from  Triarc $27,115,000 in  cash
and $3,535,000 in the form of an offset of amounts due to Triarc as of April 23,
1993 in connection with the providing by
 
                                      F-79
 
<PAGE>
              SOUTHEASTERN PUBLIC SERVICE COMPANY AND SUBSIDIARIES
      NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
 
Triarc  of certain management  services to SEPSCO.  The aggregate $30,650,000 of
payments by Triarc included  full payment of  $6,806,000 (including $306,000  of
accrued  interest) on an unsecured promissory note issued to SEPSCO by Triarc in
connection  with  the  1988  sale  of  an  investment  and  partial  payment  of
$23,844,000   (including  $1,430,000  of  accrued  interest)  on  a  $48,952,000
promissory note (the 'Note') due to SEPSCO. The remaining $26,538,000  principal
balance  of the Note is due  on August 1, 1998. The  Note resulted from the 1986
sale of approximately 51%  of the outstanding common  shares of Graniteville  to
Triarc  and  is secured  by  such shares.  The  Note is  subordinated  to senior
indebtedness of Triarc to the extent, if any, that the payment of principal  and
interest  thereon is not  satisfied out of proceeds  of the pledged Graniteville
shares. SEPSCO used  the $27,115,000  of cash  proceeds to  pay $12,689,000  due
under  its accounts receivable  financing arrangement which  was then terminated
and to  pay  $14,426,000  (including  $383,000  of  accrued  interest)  owed  to
Chesapeake Insurance.
 
6. INVESTMENTS IN AFFILIATES
 
     Investments in affiliates consisted of the following:
 
<TABLE>
<CAPTION>
                                                                              FEBRUARY 28,    NOVEMBER 30,
                                                                                  1993            1993
                                                                              ------------    ------------
                                                                                     (IN THOUSANDS)
<S>                                                                           <C>             <C>
Graniteville...............................................................     $ 62,530        $ 67,490
CFC Holdings...............................................................        1,297             543
Chesapeake Insurance (Note 4)..............................................        1,500          --
                                                                              ------------    ------------
                                                                                $ 65,327        $ 68,033
                                                                              ------------    ------------
                                                                              ------------    ------------
</TABLE>
 

     Equity  in earnings  of affiliates before  cumulative effect  of changes in
accounting principles consisted of the following:

 
<TABLE>
<CAPTION>
                                                                                          NINE MONTHS
                                                                                             ENDED
                                                                                          NOVEMBER 30,
                                                                                        ----------------
                                                                                         1992      1993
                                                                                        ------    ------
                                                                                         (IN THOUSANDS)
<S>                                                                                     <C>       <C>
Graniteville.........................................................................   $9,371    $4,960(a)
CFC Holdings.........................................................................      276     (650)(a)
                                                                                        ------    ------
                                                                                        $9,647    $4,310
                                                                                        ------    ------
                                                                                        ------    ------
</TABLE>
 
- ------------
 
(a) Affected by certain significant charges as set forth in Note 2.
 
GRANITEVILLE
 
     Effective March 1, 1992 Graniteville adopted the provisions of Statement of
Financial Accounting Standards  ('SFAS') No. 109  'Accounting for Income  Taxes'
('SFAS  109') (see Note 7  for further discussion of SFAS  109) and SFAS No. 106
'Employers' Accounting for Postretirement  Benefits Other than Pensions'  ('SFAS
106'). The cumulative effect of the changes in accounting principles resulted in
charges  to  Graniteville's  consolidated  statement  of  earnings  amounting to
$12,314,000 for SFAS  109 and $722,000,  net of Graniteville's  income taxes  of
$429,000, for SFAS 106. SEPSCO's equity in such cumulative effect, net of SEPSCO
income  taxes  of $434,000  on  the ultimate  distribution  of such  earnings to
SEPSCO, amounted to a charge  of $5,954,000, or $.51  per share and is  reported
separately  in the condensed  consolidated statement of  operations for the nine
months ended November 30, 1992.
 
     Under its  present  credit  facility,  Graniteville  is  permitted  to  pay
dividends or make loans or advances to its stockholders, including SEPSCO, in an
amount  equal to  50% of  the net  income of  Graniteville accumulated  from the
beginning   of    the   first    fiscal   year    commencing   on    or    after
 
                                      F-80
 
<PAGE>
              SOUTHEASTERN PUBLIC SERVICE COMPANY AND SUBSIDIARIES
      NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
 
December   20,  1994,  provided  that   the  outstanding  principal  balance  of
Graniteville's term loan  is less than  $50,000,000 at the  time of the  payment
(the  outstanding principal balance was $75,000,000 as of November 30, 1993) and
certain other conditions are met. Accordingly, Graniteville is unable to pay any
dividends or make any loans or advances to SEPSCO prior to December 31, 1995.
 
     Summary consolidated results  of operations  of Graniteville  for the  nine
months ended November 30, 1992 and 1993 are as follows:
 
<TABLE>
<CAPTION>
                                                                                    NINE MONTHS ENDED
                                                                                       NOVEMBER 30,
                                                                                   --------------------
                                                                                     1992        1993
                                                                                   --------    --------
                                                                                      (IN THOUSANDS)
<S>                                                                                <C>         <C>
Operating revenues..............................................................   $378,039    $399,870
Operating profit (Note 2).......................................................     36,028      27,853
Earnings before cumulative effect of changes in accounting principles (Note
  2)............................................................................     19,125      10,127
Net earnings (Note 2)...........................................................      6,089      10,127
</TABLE>
 
CFC HOLDINGS
 
     Effective  January 1, 1993, CFC Holdings adopted SFAS 109 and SFAS 106 with
the cumulative effect of changes  in accounting principles resulting in  charges
to the CFC Holdings consolidated statement of operations amounting to $1,738,000
and  $153,000, respectively. SEPSCO's equity  in such cumulative effect amounted
to a charge  of $102,000 or  $.01 per share  and is reported  separately in  the
condensed  consolidated  statement  of  operations  for  the  nine  months ended
November 30, 1993.
 
7. INCOME TAXES
 
     SEPSCO recorded  a  benefit from  income  taxes of  $1,791,000  during  the
nine-month  period ended  November 30, 1993  despite a pretax  loss of $608,000,
representing an  effective  rate substantially  in  excess of  the  35%  Federal
statutory  rate,  principally due  to the  equity in  earnings of  affiliates of
$4,310,000 on which no income taxes were provided.
 
     Effective March 1,  1993 SEPSCO adopted  the provisions of  SFAS 109  which
requires  a change from the deferred method to the asset and liability method of
accounting for  income taxes.  Under the  asset and  liability method,  deferred
income   taxes  are  recognized  for  the  tax  consequences  of  the  temporary
differences between the financial statement  carrying amounts and the tax  bases
of assets and liabilities. The deferred income tax provision or benefit for each
year  represents the decrease or increase,  respectively, in the deferred income
tax benefit  during such  year. The  cumulative effect  on prior  years of  this
change  in accounting principles was  a credit of $7,617,000  or $.65 per share,
and is reported separately in the condensed consolidated statement of operations
for the nine months ended November  30, 1993. Prior years' financial  statements
have not been restated.
 
                                      F-81
 
<PAGE>
              SOUTHEASTERN PUBLIC SERVICE COMPANY AND SUBSIDIARIES
      NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
 
     The  current and non-current deferred tax assets from continuing operations
and current deferred  tax asset  and non-current deferred  tax (liability)  from
discontinued  operations consisted  of the following  components as  of March 1,
1993:
 
<TABLE>
<CAPTION>
                                                                                         CURRENT
                                                                                --------------------------
                                                                                CONTINUING    DISCONTINUED
                                                                                OPERATIONS     OPERATIONS
                                                                                ----------    ------------
                                                                                      (IN THOUSANDS)
<S>                                                                             <C>           <C>
Net operating loss, alternative minimum tax and depletion carryforwards......     $1,961         $5,667
Allowance for doubtful accounts..............................................        102            353
Reserve for losses on construction contracts.................................         --            608
Ehrman Litigation settlement reserve (See Note 9)............................        495             --
Reserve for employee benefit costs...........................................        207            317
Other........................................................................         20            126
                                                                                ----------    ------------
                                                                                  $2,785         $7,071
                                                                                ----------    ------------
                                                                                ----------    ------------
</TABLE>
 
<TABLE>
<CAPTION>
                                                                                       NON-CURRENT
                                                                                --------------------------
                                                                                CONTINUING    DISCONTINUED
                                                                                OPERATIONS     OPERATIONS
                                                                                ----------    ------------
                                                                                      (IN THOUSANDS)
<S>                                                                             <C>           <C>
Accelerated depreciation.....................................................    $ (1,567)      $(17,071)
Amortization of original issue discount......................................       1,561             --
Insurance premiums not yet paid to a third party.............................          --          1,437
Reserves for environmental costs.............................................          --          1,115
Reserve for income tax contingencies.........................................          --           (951)
Other........................................................................          (4)           317
                                                                                ----------    ------------
                                                                                 $    (10)      $(15,153)
                                                                                ----------    ------------
                                                                                ----------    ------------
</TABLE>
 
     Federal income tax  returns of SEPSCO  have been examined  by the  Internal
Revenue Service ('IRS') for the tax years 1985 through 1988. Such audit has been
substantially  resolved  at no  material cost  to SEPSCO.  The IRS  has recently
commenced the examination  of SEPSCO's Federal  income tax returns  for the  tax
years  from 1989 through 1992. The amount and timing of any payments required as
a result of the 1989 through 1992 audit cannot presently be determined. However,
SEPSCO believes that it has adequate aggregate reserves for any tax liabilities,
including interest, that may result from all such examinations.
 
8. INCOME (LOSS) PER SHARE
 
     The income  (loss) per  share  has been  computed  by dividing  net  income
(loss),  after  the reduction  for an  insignificant  amount of  preferred stock
dividends, by the 11,655,067 weighted  average common shares outstanding  during
the nine-month periods ended November 30, 1992 and 1993.
 
9. LEGAL MATTERS
 
     In  December  1990, a  purported shareholder  derivative suit  (the 'Ehrman
Litigation') was brought  against SEPSCO's  directors at that  time and  certain
corporations,  including  Triarc,  in  the  United  States  District  Court (the
'District Court').  On  October  18,  1993, Triarc  entered  into  a  settlement
agreement  (the 'Settlement Agreement') with  the plaintiff (the 'Plaintiff') in
the Ehrman Litigation.  The Settlement Agreement  provides, among other  things,
that  SEPSCO  would be  merged  into, or  otherwise  acquired by,  Triarc  or an
affiliate thereof, in a transaction in  which each holder of shares of  SEPSCO's
common stock par value $1.00 per share ('SEPSCO Common Stock') other than Triarc
Companies  will receive in exchange  for each share of  SEPSCO Common Stock, 0.8
shares of Triarc's common stock. On
 
                                      F-82
 
<PAGE>
              SOUTHEASTERN PUBLIC SERVICE COMPANY AND SUBSIDIARIES
      NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
 
November 22, 1993 Triarc and SEPSCO entered into a merger agreement pursuant  to
which  a subsidiary of Triarc will be merged into SEPSCO in the manner described
in the  Settlement  Agreement  (the  'Merger').  Following  the  Merger,  Triarc
Companies  would  own  100% of  the  SEPSCO  Common Stock.  Consummation  of the
Settlement Agreement  and the  Merger are  conditioned on,  among other  things,
approval  by SEPSCO's stockholders  other than Triarc  Companies. On January 11,
1994 the District Court approved the Settlement Agreement.
 
     The  Settlement  Agreement  also  provides  that  Plaintiff's  counsel  and
financial advisor will be paid by Triarc, subject to court approval, cash not to
exceed $1,250,000 and $50,000, respectively and that Triarc would be responsible
for  other expenses relating to the issuance of Triarc common shares pursuant to
the Merger. SEPSCO had previously accrued such $1,300,000 in the fourth  quarter
of  SEPSCO Fiscal 1993 and accrued additional expenses related to the settlement
of the Ehrman  Litigation of  $400,000 and $1,200,000  in the  first and  second
quarters  of  SEPSCO  Transition  1993,  respectively,  since  SEPSCO originally
anticipated it would  be responsible  for such  fees and  expenses. However,  as
previously  indicated, the Settlement Agreement  established that Triarc and not
SEPSCO was  responsible  for certain  of  these expenditures  and,  accordingly,
SEPSCO  reversed $1,900,000 of previously accrued  expenses in the third quarter
of SEPSCO Transition 1993.
 
     In 1987,  Graniteville was  notified by  the South  Carolina Department  of
Health   and  Environmental   Control  ('DHEC')   that  it   discovered  certain
contamination of  Langley  Pond  near  Graniteville,  South  Carolina  and  DHEC
asserted  that  Graniteville may  be  one of  the  parties responsible  for such
contamination. Graniteville  entered into  a consent  decree providing  for  the
study  and investigation  of the  alleged pollution  and its  sources. The study
report prepared by Graniteville's environmental  consulting firm and filed  with
DHEC  in April 1990, recommended that pond  sediments be left undisturbed and in
place.  DHEC  responded  by  requesting  that  Graniteville  submit   additional
information  concerning potential passive and active remedial alternatives, with
accompanying supportive  information. In  May  1991 Graniteville  provided  this
information to DHEC in a report of Graniteville's environmental consulting firm.
The  1990  and  1991  reports  concluded  that  pond  sediments  should  be left
undisturbed and in place  and that other  less passive remediation  alternatives
either  provided  no  significant  additional  benefits  or  themselves involved
adverse effects  on  human health,  to  existing  recreational uses  or  to  the
existing  biological communities. Triarc is unable  to predict at this time what
further actions, if any, may be required in connection with Langley Pond or what
the cost thereof may be. However, given the passage of time since the submission
of  the  two  reports  by  DHEC   and  the  absence  of  desirable   remediation
alternatives, other than continuing to leave the Langley Pond sediments in place
and  undisturbed  as  described in  the  reports, SEPSCO  believes  the ultimate
outcome of  this matter  will not  have a  material adverse  effect on  SEPSCO's
consolidated results of operations or financial position.
 
     As a result of certain environmental audits in 1991, SEPSCO became aware of
possible  contamination by hydrocarbons and metals  at certain sites of SEPSCO's
refrigeration operations  and has  filed  appropriate notifications  with  state
environmental  authorities and has  begun a study of  remediation at such sites.
SEPSCO has  removed  certain underground  storage  and other  tanks  at  certain
facilities   of  its  refrigeration  operations   and  has  engaged  in  certain
remediation in connection therewith. Such removal and environmental  remediation
involved  a  variety  of remediation  actions  at various  facilities  of SEPSCO
located in a number of jurisdictions. Such remediation varied from site to site,
ranging from testing of soil  and groundwater for contamination, development  of
remediation  plans  and removal  in  certain instances  of  certain contaminated
soils. Based  on preliminary  information and  consultations with,  and  certain
reports of, environmental consultants and others, SEPSCO presently estimates the
cost  of such  remediation and/or  removal will  approximate $3,700,000,  all of
which was provided in prior years. In connection therewith, SEPSCO has  incurred
actual costs through November 30, 1993 of $1,143,000 and has a remaining accrual
of  $2,557,000. SEPSCO believes that after  such accrual the ultimate outcome of
this matter will  not have a  material adverse effect  on SEPSCO's  consolidated
results of operations or financial position.
 
                                      F-83

<PAGE>
               REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
 
To the Board of Directors and Stockholders,
GRANITEVILLE COMPANY:
 
     We   have  audited   the  accompanying   consolidated  balance   sheets  of
Graniteville Company (a South Carolina corporation and 49% owned by Southeastern
Public Service Company  and 51%  owned by  Triarc Companies  Inc., formerly  DWG
Corporation) and subsidiaries as of March 1, 1992 and February 28, 1993, and the
related  consolidated statements of income and  retained earnings and cash flows
for each  of the  three  years in  the period  ended  February 28,  1993.  These
financial  statements are  the responsibility  of the  Company's management. Our
responsibility is to express an opinion  on these financial statements based  on
our audits.
 
     We  conducted  our audits  in accordance  with generally  accepted auditing
standards. Those standards require that we plan and perform the audit to  obtain
reasonable assurance about whether the financial statements are free of material
misstatement.  An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also  includes
assessing  the  accounting principles  used  and significant  estimates  made by
management, as well as evaluating the overall financial statement  presentation.
We believe that our audits provide a reasonable basis for our opinion.
 
     In  our opinion, the financial statements referred to above present fairly,
in all material  respects, the  financial position of  Graniteville Company  and
subsidiaries as of March 1, 1992 and February 28, 1993, and the results of their
operations  and their cash flows for each of the three years in the period ended
February 28, 1993, in conformity with generally accepted accounting principles.
 
     As discussed in  Notes 1 and  4 to the  consolidated financial  statements,
effective March 2, 1992, the Company changed its method of accounting for income
taxes and postretirement benefits other than pensions.
 
                                          ARTHUR ANDERSEN & CO.
 
Columbia, South Carolina,
  May 4, 1993.
 
                                      F-84
 
<PAGE>
 
                     GRANITEVILLE COMPANY AND SUBSIDIARIES
                          CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
                                                                                           MARCH 1,    FEBRUARY 28,
                                                                                           --------    ------------
                                                                                             1992          1993
                                                                                           --------    ------------
                                                                                                (IN THOUSANDS)
<S>                                                                                        <C>         <C>
                                         ASSETS
Current assets:
     Cash and equivalents...............................................................   $    838      $  1,235
     Receivables, net (Notes 1 and 5)...................................................     32,202        65,463
     Inventories (Notes 1 and 2)........................................................     77,674        81,150
     Deferred income taxes..............................................................      2,081         5,084
     Other current assets...............................................................      2,006         1,326
                                                                                           --------    ------------
          Total current assets..........................................................    114,801       154,258
                                                                                           --------    ------------
Properties, net (Notes 1 and 3).........................................................    102,119       105,472
                                                                                           --------    ------------
Other assets............................................................................      3,422         3,634
                                                                                           --------    ------------
                                                                                           $220,342      $263,364
                                                                                           --------    ------------
                                                                                           --------    ------------
                          LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
     Current portion of long-term debt (Notes 5 and 13).................................   $ 10,268      $  9,809
     Short-term borrowings (Notes 5 and 13).............................................      1,959        --
     Accounts payable...................................................................     23,382        24,750
     Accrued salaries and wages (Note 11)...............................................      4,473         8,275
     Accrued restructuring costs (Note 10)..............................................      1,704        --
     Deferred income taxes (Notes 1 and 4)..............................................      --           10,566
     Other current liabilities..........................................................      4,995         6,456
                                                                                           --------    ------------
          Total current liabilities.....................................................     46,781        59,856
Long-term debt (Notes 5 and 13).........................................................     41,821        52,896
Deferred income taxes (Notes 1 and 4)...................................................      9,845        21,374
Other liabilities.......................................................................        475         1,626
                                                                                           --------    ------------
Commitments and contingencies (Notes 9 and 13)
Stockholders' equity:
     Common stock, $5.00 par value; 10,000,000 shares authorized; 4,984,045 shares
      issued............................................................................     24,920        24,920
     Capital in excess of par value.....................................................     41,712        41,712
     Retained earnings..................................................................     54,788        60,980
                                                                                           --------    ------------
          Total stockholders' equity....................................................    121,420       127,612
                                                                                           --------    ------------
                                                                                           $220,342      $263,364
                                                                                           --------    ------------
                                                                                           --------    ------------
</TABLE>
 
          See accompanying notes to consolidated financial statements.
 
                                      F-85
 
<PAGE>
 
                     GRANITEVILLE COMPANY AND SUBSIDIARIES
            CONSOLIDATED STATEMENTS OF INCOME AND RETAINED EARNINGS
<TABLE>
<CAPTION>
                                                                                           YEAR ENDED
                                                                              ------------------------------------
                                                                              MARCH 3,    MARCH 1,    FEBRUARY 28,
                                                                                1991        1992          1993
                                                                              --------    --------    ------------
                                                                                         (IN THOUSANDS)
<S>                                                                           <C>         <C>         <C>
Operating revenues.........................................................   $414,538    $456,402      $499,060
                                                                              --------    --------    ------------
Operating costs and expenses:
     Cost of sales.........................................................    374,062     397,843       412,569
     Selling, general and administrative expenses (Notes 8 and 11).........     29,857      27,273        34,902
     Restructuring costs (Note 10).........................................      --          2,500         1,855
                                                                              --------    --------    ------------
                                                                               403,919     427,616       449,326
                                                                              --------    --------    ------------
          Operating profit.................................................     10,619      28,786        49,734
                                                                              --------    --------    ------------
Other expenses (income):
     Interest expense......................................................     10,153      11,941         9,282
     Interest income.......................................................       (145)       (100)         (199)
     Other, net (Note 7)...................................................      4,615        (280)          (41)
                                                                              --------    --------    ------------
                                                                                14,623      11,561         9,042
                                                                              --------    --------    ------------
          Income (loss) before income taxes and cumulative effect of
            accounting changes.............................................     (4,004)     17,225        40,692
Provision for (benefit from) income taxes..................................    (11,982)      4,962        15,332
                                                                              --------    --------    ------------
          Income before cumulative effect of changes in accounting
            principles.....................................................      7,978      12,263        25,360
Cumulative effect of changes in accounting for:
     Income taxes (Notes 1 and 4)..........................................      --          --          (12,314)
     Postretirement benefits other than pensions, net of tax of $429 (Note
       1)..................................................................      --          --             (722)
                                                                              --------    --------    ------------
     Net income............................................................      7,978      12,263        12,324
Retained earnings at beginning of year.....................................     46,003      44,643        54,788
          Cash dividends on common stock...................................     (9,338)     (2,118)       (6,132)
                                                                              --------    --------    ------------
Retained earnings at end of year...........................................   $ 44,643    $ 54,788      $ 60,980
                                                                              --------    --------    ------------
                                                                              --------    --------    ------------
</TABLE>
 
          See accompanying notes to consolidated financial statements.
 
                                      F-86
 
<PAGE>
 
                     GRANITEVILLE COMPANY AND SUBSIDIARIES
                     CONSOLIDATED STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
                                                                                             YEAR ENDED
                                                                                 ----------------------------------
                                                                                  MARCH      MARCH
                                                                                   3,         1,       FEBRUARY 28,
                                                                                  1991       1992          1993
                                                                                 -------    -------    ------------
                                                                                           (IN THOUSANDS)
<S>                                                                              <C>        <C>        <C>
Cash flows from operating activities:
     Net income...............................................................   $ 7,978    $12,263      $ 12,324
     Adjustments to reconcile net income to net cash and equivalents provided
       by operating activities:
          Depreciation and amortization.......................................     8,364      9,897        10,379
          Increase (decrease) in deferred income taxes, net of accounting
            changes...........................................................    (3,068)     2,996         3,142
          Provision for doubtful accounts.....................................       513        314         1,351
Cumulative effect of changes in accounting principles.........................     --         --           13,036
Other, net....................................................................        97         44            71
Decrease (increase) in:
     Receivables..............................................................    26,506       (169)      (34,612)
     Inventories..............................................................    (7,628)       221        (3,476)
     Other current asset......................................................    (2,124)     2,684          (237)
Increase (decrease) in:
     Accounts payable.........................................................     2,748      2,466         1,368
     Other liabilities........................................................   (25,029)     --              429
     Other current liabilities................................................     7,452     (7,863)        3,928
                                                                                 -------    -------    ------------
               Net cash and equivalents provided by operating activities......    15,809     22,853         7,703
                                                                                 -------    -------    ------------
Cash flows from investing activities:
     Capital expenditures.....................................................   (15,986)   (11,384)       (9,731)
     Proceeds from sale of machinery and equipment............................        21        245           508
     Other, net...............................................................       (52)    (3,070)         (264)
                                                                                 -------    -------    ------------
               Net cash and equivalents used in investing activities..........   (16,017)   (14,209)       (9,487)
                                                                                 -------    -------    ------------
Cash flows from financing activities:
     Increase (decrease) in short-term borrowings.............................     --         1,959        (1,959)
     Repayment of long-term debt..............................................   (11,720)   (10,378)       (8,478)
     Additions to long-term debt..............................................    20,735        702        18,750
     Payment of dividends on common stock.....................................    (9,338)    (2,118)       (6,132)
                                                                                 -------    -------    ------------
               Net cash and equivalents provided by (used in) financing
                 activities...................................................      (323)    (9,835)        2,181
                                                                                 -------    -------    ------------
Net increase (decrease) in cash and equivalents...............................      (531)    (1,191)          397
Cash and equivalents at beginning of year.....................................     2,560      2,029           838
                                                                                 -------    -------    ------------
Cash and equivalents at end of year...........................................   $ 2,029    $   838      $  1,235
                                                                                 -------    -------    ------------
                                                                                 -------    -------    ------------
Supplemental disclosures of cash flow information:
     Cash paid (received) during the year for:
          Interest............................................................   $10,178    $11,974      $  9,334
                                                                                 -------    -------    ------------
          Income taxes........................................................   $(1,338)   $(8,516)     $  8,105
                                                                                 -------    -------    ------------
                                                                                 -------    -------    ------------
Supplemental schedule of non-cash investing and financing activities:
          Total capital expenditures..........................................   $16,337    $11,399      $ 10,075
          Capital expenditures financed by capital leases.....................      (351)       (15)         (344)
                                                                                 -------    -------    ------------
                                                                                 $15,986    $11,384      $  9,731
                                                                                 -------    -------    ------------
                                                                                 -------    -------    ------------
</TABLE>
 
          See accompanying notes to consolidated financial statements.
 
                                      F-87

<PAGE>
                     GRANITEVILLE COMPANY AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                               FEBRUARY 28, 1993
 
(1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
 
BASIS OF PRESENTATION
 
     In  August 1983,  Southeastern Public Service  Company ('SEPSCO') completed
its tender offer for Graniteville Company's ('Graniteville') common stock and in
July 1984, Graniteville became a  wholly-owned subsidiary of SEPSCO. In  January
1986,  Triarc Companies Inc. ('Triarc', formerly DWG Corporation) purchased from
SEPSCO  2,541,862  shares   of  common  stock   of  Graniteville,   constituting
approximately  51%  of Graniteville's  outstanding common  stock, pursuant  to a
Stock Purchase Agreement dated January 30,  1986, between Triarc and SEPSCO.  At
February  28,  1993,  SEPSCO  was  65%  owned by  Triarc.  As  a  result  of the
transaction described in Note 12,  SEPSCO is 71.1% owned  by Triarc as of  April
23, 1993.
 
PRINCIPLES OF CONSOLIDATION
 
     The  consolidated financial statements include the accounts of Graniteville
and its  subsidiaries,  C.  H.  Patrick  &  Co.,  Inc.  ('C.  H.  Patrick')  and
Graniteville   International  Sales,  Inc.  ('Graniteville  International'),  an
inactive corporation.  All significant  intercompany balances  and  transactions
have been eliminated in consolidation.
 
     Certain  amounts  included  in  the  prior  years'  consolidated  financial
statements  have  been   reclassified  to  conform   with  the  current   year's
presentation.
 
INVENTORIES
 
     Substantially all inventories, consisting of materials, labor and overhead,
are stated at the lower of cost (last-in, first-out basis) or market.
 
DEPRECIATION AND AMORTIZATION
 
     Depreciation  is computed  on the  straight-line basis  using the estimated
useful lives  of the  related major  classes of  properties: 3  to 6  years  for
automotive  equipment; 12 to 14 years for  machinery and equipment; and 15 to 60
years for  buildings  and improvements.  Under  this method,  gains  and  losses
arising from disposals are included in current earnings.
 
RESEARCH AND DEVELOPMENT
 
     Research and development expenses amounted to $652,000 in 1991, $691,000 in
1992, and $744,000 in 1993.
 
INCOME TAXES
 
     Federal   income  tax   returns  for  Graniteville   and  its  consolidated
subsidiaries were filed on a consolidated basis with SEPSCO from August 7,  1983
through  January 31, 1986. Subsequent to  January 31, 1986, Graniteville and its
consolidated subsidiaries have filed separate income tax returns as a result  of
the  sale by  SEPSCO of  a portion of  Graniteville's common  stock as described
above.
 
     Effective March 2, 1992, Graniteville  adopted the provisions of  Statement
of  Financial  Accounting Standards  ('SFAS')  No. 109,  'Accounting  for Income
Taxes,' ('SFAS 109')  which requires a  change from the  deferred method to  the
asset  and liability method of accounting for  income taxes. Under the asset and
liability method, deferred income taxes are recognized for the tax  consequences
of  'temporary  differences'  by applying  the  enacted statutory  tax  rates to
differences between the financial statement  carrying amounts and the tax  bases
of existing assets and liabilities. Under SFAS 109, the effect on deferred taxes
of  a change in  tax rates is recognized  in income in  the period of enactment.
 
                                      F-88
 
<PAGE>
                     GRANITEVILLE COMPANY AND SUBSIDIARIES
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
                               FEBRUARY 28, 1993
 
Under the deferred  method, deferred taxes  were recognized using  the tax  rate
applicable  to the  year the  item arose  and were  not adjusted  for subsequent
changes in tax rates.
 
     Graniteville has reported the cumulative effect of the change in the method
of accounting for income taxes as of  the beginning of 1993 in the  consolidated
statement of income.
 
REVENUE RECOGNITION
 
     Graniteville  records  revenues  principally  when  inventory  is  shipped.
Graniteville also records revenues to a lesser  extent on a bill and hold  basis
under  which the goods are complete, packaged and ready for shipment; such goods
are effectively segregated from inventory which is available for sale; the risks
of ownership  of the  goods have  passed to  the customer;  and such  underlying
customer orders are supported by written confirmation.
 
CONCENTRATION OF CREDIT RISK
 
     Financial   instruments   which   potentially   subject   Graniteville   to
concentration of credit  risk consist  primarily of  trade accounts  receivable.
Graniteville's  customers consist of domestic  and foreign apparel producers and
other  users  of   textile  products.  Graniteville   performs  ongoing   credit
evaluations  of its customers' financial  condition and establishes an allowance
for doubtful accounts based upon factors surrounding the credit risk of specific
customers, historical trends  and other information.  In addition,  Graniteville
sells,  on a  non-recourse basis, a  significant volume  of accounts receivable,
thereby reducing its exposure to credit risk. Historically, Graniteville has not
incurred material credit-related losses.
 
BUSINESS SEGMENT
 
     Graniteville manufactures, dyes and finishes cotton, synthetic and  blended
(cotton  and polyester) fabrics, primarily for  the apparel trade and mainly for
two consumer end-uses: (1) utility wear  and (2) men's, women's, and  children's
sportswear,  casual wear and outerwear.  Through its wholly-owned subsidiary, C.
H. Patrick,  Graniteville also  is engaged  in producing  and selling  dyes  and
chemicals, primarily to the textile trade.
 
MAJOR CUSTOMER
 
     Sales  to a group  of customers under  common control totaled approximately
14%, 11%, and 14% of Graniteville's sales in 1991, 1992, and 1993, respectively.
No other customer or similar group accounted for more than 10% of Graniteville's
sales in such years.
 
POSTRETIREMENT BENEFITS OTHER THAN PENSIONS
 
     In 1993, Graniteville adopted the  provisions of SFAS No. 106,  'Employers'
Accounting  for Postretirement  Benefits Other  Than Pensions'.  In applying the
provisions  of   this  statement,   Graniteville  recognized   the   accumulated
postretirement benefit obligation as of the beginning of 1993 of $1,151,000 as a
change in accounting principle. On an aftertax basis, this charge was $722,000.
 
FISCAL YEAR
 
     Graniteville's fiscal year is the 52 or 53 week period ending on the Sunday
nearest  the last day  of February. Fiscal  years 1991, 1992,  and 1993 ended on
March 3,  1991, March  1, 1992,  and February  28, 1993,  respectively. As  used
herein,  February  28 shall  mean the  last day  of Graniteville's  fiscal year.
Fiscal year 1991 included 53 weeks, 1992 included 52 weeks, and 1993 included 52
weeks.
 
                                      F-89
 
<PAGE>
                     GRANITEVILLE COMPANY AND SUBSIDIARIES
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
                               FEBRUARY 28, 1993
 
(2) INVENTORIES
 
     The following is a summary of the major classifications of inventories:
 
<TABLE>
<CAPTION>
                                                                                        FEBRUARY 28,
                                                                                  ------------------------
                                                                                    1992          1993
                                                                                  --------    ------------
                                                                                       (IN THOUSANDS)
<S>                                                                               <C>         <C>
Raw materials..................................................................   $ 16,548      $ 15,696
Work in process................................................................      5,828         5,516
Finished goods.................................................................     52,572        57,512
Supplies.......................................................................      2,726         2,426
                                                                                  --------    ------------
                                                                                  $ 77,674      $ 81,150
                                                                                  --------    ------------
                                                                                  --------    ------------
</TABLE>
 
     Had the first-in, first-out method  been used, inventories would have  been
$3,800,000  and  $2,500,000  higher at  March  1,  1992 and  February  28, 1993,
respectively.
 
(3) PROPERTIES
 
     The following is a summary of the major classifications of properties, net:
 
<TABLE>
<CAPTION>
                                                                                       FEBRUARY 28,
                                                                                 ------------------------
                                                                                   1992          1993
                                                                                 --------    ------------
                                                                                      (IN THOUSANDS)
<S>                                                                              <C>         <C>
Land..........................................................................   $  3,584      $  4,358
Buildings and improvements....................................................     18,032        22,603
Machinery and equipment.......................................................    120,394       128,728
Automotive equipment..........................................................      4,229         4,498
                                                                                 --------    ------------
                                                                                  146,239       160,187
Less accumulated depreciation and amortization................................     44,120        54,715
                                                                                 --------    ------------
                                                                                 $102,119      $105,472
                                                                                 --------    ------------
                                                                                 --------    ------------
</TABLE>
 
(4) INCOME TAXES
 
     The provision for  (benefit from)  income taxes consists  of the  following
components:
 
<TABLE>
<CAPTION>
                                                                            YEAR ENDED FEBRUARY 28,
                                                                      ------------------------------------
                                                                        1991        1992          1993
                                                                      --------    --------    ------------
                                                                                 (IN THOUSANDS)
<S>                                                                   <C>         <C>         <C>
Current:
     Federal.......................................................   $ (8,918)    $1,974       $ 11,109
     State.........................................................       (125)         7            835
                                                                      --------    --------    ------------
                                                                        (9,043)     1,981         11,944
                                                                      --------    --------    ------------
Deferred:
     Federal.......................................................     (2,790)     2,411          2,234
     State.........................................................       (149)       570          1,154
                                                                      --------    --------    ------------
                                                                        (2,939)     2,981          3,388
                                                                      --------    --------    ------------
                                                                      $(11,982)    $4,962       $ 15,332
                                                                      --------    --------    ------------
                                                                      --------    --------    ------------
</TABLE>
 
     As  described in  Note 1, Graniteville  adopted SFAS 109  during 1993. This
accounting change required a restatement of Graniteville's deferred tax accounts
as of the beginning of 1993, which resulted in a charge of $12,314,000 which  is
reflected  as  the  cumulative effect  of  changes in  accounting  principles in
Graniteville's  consolidated  statement  of  earnings.  The  cumulative   effect
adjustment relates
 
                                      F-90
 
<PAGE>
                     GRANITEVILLE COMPANY AND SUBSIDIARIES
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
                               FEBRUARY 28, 1993
 
primarily  to recording deferred taxes on the  differences in the book basis and
tax basis of assets. The largest portion of these differences arose at the  time
of  Graniteville's  purchase  by  SEPSCO  in  1983  and  were  accounted  for in
accordance with accounting standards in effect at that time.
 
     The difference between the reported tax provision for (benefit from) income
taxes and  a  computed  tax based  on  income  (loss) before  income  taxes  and
cumulative  effect of changes in accounting  principles at the statutory rate is
reconciled as follows:
 
<TABLE>
<CAPTION>
                                                                            YEAR ENDED FEBRUARY 28,
                                                                      ------------------------------------
                                                                        1991        1992          1993
                                                                      --------    --------    ------------
                                                                                 (IN THOUSANDS)
<S>                                                                   <C>         <C>         <C>
Income (loss) before income taxes and cumulative effect of changes
  in accounting principles.........................................   $ (4,004)   $ 17,225      $ 40,692
                                                                      --------    --------    ------------
Computed expected tax provision (benefit) at 34%...................   $ (1,362)   $  5,857      $ 13,835
Increase (decrease) in Federal taxes resulting from:
     Amortization of nontaxable credits resulting from purchase
       accounting adjustments......................................     (1,351)     (1,350)       --
     Employee benefit plan payment.................................     (8,429)      --           --
     State income taxes net of federal benefit.....................       (181)        380         1,313
     Other, net....................................................       (659)         75           184
                                                                      --------    --------    ------------
                                                                      $(11,982)   $  4,962      $ 15,332
                                                                      --------    --------    ------------
                                                                      --------    --------    ------------
</TABLE>
 
     At February 28, 1993, the deferred tax assets and liabilities are comprised
of:
 
<TABLE>
<CAPTION>
                                                                             DEFERRED TAX    DEFERRED TAX
                                                                                ASSETS       LIABILITIES
                                                                             ------------    ------------
<S>                                                                          <C>             <C>
Receivables...............................................................      $1,386         $ --
Inventory.................................................................      --               10,566
Accrued compensation......................................................       2,704           --
Other accrued liabilities.................................................         984           --
Property, plant and equipment.............................................      --               19,566
All other.................................................................          10            1,808
                                                                             ------------    ------------
                                                                                $5,084         $ 31,940
                                                                             ------------    ------------
                                                                             ------------    ------------
Classified as:
     Current assets or liabilities........................................      $5,084         $ 10,566
     Non-current assets or liabilities....................................      --               21,374
                                                                             ------------    ------------
                                                                                $5,084         $ 31,940
                                                                             ------------    ------------
                                                                             ------------    ------------
</TABLE>
 
                                      F-91
 
<PAGE>
                     GRANITEVILLE COMPANY AND SUBSIDIARIES
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
                               FEBRUARY 28, 1993
 
     Deferred  income  taxes  (credits)   result  from  timing  differences   in
recognition  of  revenue  and expense  for  income tax  and  financial statement
purposes. The tax effects of the principal timing differences are as follows:
 
<TABLE>
<CAPTION>
                                                                             YEAR ENDED FEBRUARY 28,
                                                                           ---------------------------
                                                                            1991       1992      1993
                                                                           -------    ------    ------
                                                                                 (IN THOUSANDS)
<S>                                                                        <C>        <C>       <C>
Excess of tax over book depreciation and amortization on properties.....   $ 1,996    $  919    $1,508
Restructuring costs.....................................................     --         (850)      320
Book-tax differences resulting from purchase accounting adjustments.....       (30)      (42)      (94)
Employee benefit plan payment...........................................    (3,064)    3,064      --
Alternative minimum tax carryforward....................................    (1,576)     (976)    2,684
Maintenance accrual not deductible until paid...........................     --         --        (373)
Compensation accrual not deductible until paid..........................       237       756    (1,487)
Inventory capitalization................................................      (171)     (171)       43
Bad debt expense........................................................      (162)        3        29
Other...................................................................      (169)      278       758
                                                                           -------    ------    ------
                                                                           $(2,939)   $2,981    $3,388
                                                                           -------    ------    ------
                                                                           -------    ------    ------
</TABLE>
 
     Federal income tax returns  for the years 1986  through 1988 are  currently
under  examination  and no  report has  yet  been issued  by the  IRS. Including
amounts accrued in prior years, management believes that adequate provision  has
been made for all tax liabilities and interest thereon.
 
(5) LONG-TERM DEBT
 
     Long-term debt consists of the following:
 
<TABLE>
<CAPTION>
                                                                                             FEBRUARY 28,
                                                                                     ----------------------------
                                                                                         1992            1993
                                                                                     ------------    ------------
                                                                                            (IN THOUSANDS)
<S>                                                                                  <C>             <C>
Term loan.........................................................................     $   46,875      $   60,000
Capitalized lease obligations (Note 6):
     With an affiliate............................................................            558             447
     Other........................................................................            748             330
6.5% Washington National Insurance Company Pollution Control note due 1993 to
  1999............................................................................          1,060             946
Notes collateralized by machinery and equipment maturing at various dates through
  1996 with interest at various fixed and floating rates (weighted average
  interest rate of 8.5% at March 1, 1992 and 8.2% at February 28, 1993............          2,848             982
                                                                                     ------------    ------------
                                                                                           52,089          62,705
          Less current portion of long-term debt..................................         10,268           9,809
                                                                                     ------------    ------------
                                                                                       $   41,821      $   52,896
                                                                                     ------------    ------------
                                                                                     ------------    ------------
</TABLE>
 
                                      F-92
 
<PAGE>
                     GRANITEVILLE COMPANY AND SUBSIDIARIES
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
                               FEBRUARY 28, 1993
 
     Aggregate  annual maturities of the long-term  debt as of February 28, 1993
are as follows (in thousands):
 
<TABLE>
<S>                                                                                   <C>
1994...............................................................................   $ 9,809
1995...............................................................................     9,296
1996...............................................................................     9,080
1997...............................................................................     9,010
1998...............................................................................    25,510
Thereafter.........................................................................     --
                                                                                      -------
                                                                                      $62,705
                                                                                      -------
                                                                                      -------
</TABLE>
 
     In December 1992, Graniteville increased its term loan from its  commercial
lender from the $41.25 million then outstanding to $60.0 million. Such term loan
bears  interest  at the  prime  rate plus  1 1/4%  and  is payable  in quarterly
installments of approximately $1.9  million each through  December 1, 1993,  and
$2.25  million thereafter,  with a  final payment of  $16.5 million  on March 1,
1998. The new  note evidencing such  increased term loan  requires, among  other
things,  the  maintenance  of  certain  financial  ratios  and  includes certain
restrictive  covenants  and  events  of  default  applicable  to   Graniteville,
including  a limitation  on the payment  of dividends  to 50% of  its net income
after the end of  each fiscal year,  except that no such  dividends may be  paid
unless  Graniteville's consolidated  working capital exceeds  certain levels and
Graniteville is not in default  under the note evidencing  the term loan, and  a
prohibition  on loans and  advances to other  corporations, including Triarc and
SEPSCO, with  certain limited  exceptions. The  note also  includes a  provision
causing  the  outstanding  principal  balance  to  be  payable  13  months after
termination of the accounts receivable financing arrangements described below by
the lender  or payable  immediately after  termination of  such arrangements  by
Graniteville. This note was repaid in April 1993.
 
     In  February 1991, Graniteville entered into a modification of its accounts
receivable financing arrangements with such commercial lender, and C. H. Patrick
entered  into  a  substantially  similar  arrangement  with  such  lender.  Such
arrangements provide for advances against accounts receivable sold to the lender
on  a non-recourse  basis and  for other  advances on  receivables on  a secured
basis. Advances under  these arrangements bear  interest at 1%  above the  prime
rate  (but not less than 6%), and require the payment of a commission of .50% on
accounts receivable sold without recourse, and .22% on accounts receivable  sold
with  recourse, under the  arrangement. In addition,  the arrangements with such
lender provide  for loans  against Graniteville's  cotton inventory  based on  a
formula providing for advances of between 50 and 75 percent of the value of such
inventory.  The financing arrangements entered  into by Graniteville are secured
by substantially  all of  its accounts  receivable, cotton  inventory,  imported
inventory,  machinery, equipment and plant site  real property and the stock and
accounts receivable of C. H. Patrick.
 
     See Note 13 for a description of Graniteville's refinancing which  occurred
subsequent to year end.
 
     On April 1, 1993, the note payable to Washington National Insurance Company
was paid in full.
 
(6) LEASE COMMITMENTS
 
     Graniteville  leases  certain  machinery and  automotive  equipment  from a
corporation which may  be deemed to  be an affiliate,  and from unrelated  third
parties  under long-term  lease obligations which  are accounted  for as capital
leases and are included in machinery and automotive equipment amounts  presented
in  Note 3, in the amount of $4,452,000 and $4,392,000, at February 28, 1992 and
1993, respectively.
 
                                      F-93
 
<PAGE>
                     GRANITEVILLE COMPANY AND SUBSIDIARIES
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
                               FEBRUARY 28, 1993
 
     The future minimum lease  payments (net of sublease  rentals which are  not
significant)   under  capital  leases  and  operating  leases  with  an  initial
noncancelable term in excess of one year are as follows:
 
<TABLE>
<CAPTION>
                                                                            CAPITAL    OPERATING
                                                                            LEASES      LEASES
                                                                            -------    ---------
                                                                               (IN THOUSANDS)
<S>                                                                         <C>        <C>
1994.....................................................................    $ 635      $ 1,954
1995.....................................................................      202        1,887
1996.....................................................................       45        1,808
1997.....................................................................       11        1,624
1998.....................................................................        9          146
Thereafter...............................................................     --            170
                                                                            -------    ---------
Total minimum lease payments.............................................    $ 902      $ 7,589
                                                                                       ---------
                                                                                       ---------
Less amounts representing interest.......................................      125
                                                                            -------
Present value of minimum lease payments (Note 5).........................    $ 777
                                                                            -------
                                                                            -------
</TABLE>
 
     Rental expense under operating leases which is primarily for the rental  of
real  estate  and equipment,  was $1,187,000  in 1991,  $1,032,000 in  1992, and
$1,794,000 in 1993.
 
(7) PENSION PLAN AND OTHER POSTRETIREMENT BENEFITS
 
     On April 25, 1983, Triarc's  Board of Directors authorized the  termination
of  Graniteville's  pension  plans. Simultaneously,  Graniteville  announced the
commitment to a newly formed Employee  Stock Ownership Plan (ESOP) of an  amount
equal  to the  surplus pension assets  of approximately $36  million. During May
1983, the ESOP  used $9 million  contributed to it  by Graniteville to  purchase
from  Graniteville  642,857  shares of  Graniteville's  authorized  but unissued
common stock. Graniteville agreed  that it would satisfy  the commitment to  the
ESOP   by  contributing  to  the  ESOP   and/or  another  qualified  pension  or
profit-sharing plan over  the next  10 years an  aggregate amount  equal to  the
surplus  pension assets, minus $11.25 million (equal  to the number of shares of
Graniteville's common  stock  originally purchased  by  the ESOP  multiplied  by
$17.50). Such contributions were to be made without interest in such amounts and
at such times within such 10-year period as determined by the Board of Directors
of  Graniteville or as provided in any  new plan. Graniteville received a notice
of sufficiency from  the Pension  Benefit Guaranty Corporation  and a  favorable
determination  letter from the  Internal Revenue Service  in connection with the
applications which it had filed for the termination of its pension plans and the
distribution of the surplus pension assets.
 
     In April 1986,  the United  States Department of  Labor ('the  Department')
commenced  an action against  Graniteville and certain  other parties concerning
this commitment (see Note 9 for  details of this litigation). In December  1990,
Graniteville   announced  a  plan  of  cash  payments  to  the  trustee  of  the
Graniteville  Company  Retirement  Savings  Plan  as  successor  to  the   ESOP.
Graniteville  believes that such cash payments completely satisfy Graniteville's
commitment to contribute an amount equal  to the surplus pension plan assets  to
an  employee benefit plan within 10 years. Graniteville paid approximately $20.7
million to the trustee on February 28, 1991, and paid approximately $8.5 million
to the trustee on February 28, 1992.
 
     These cash payments  were allocated  to eligible participants  in the  Plan
over  the  six-year period  beginning with  the plan  year ending  February 1985
through  the  plan  year  ending  February  1990.  The  allocation  formula  was
determined  through  negotiations between  Graniteville  and the  Department and
generally allocated these  payments over covered  compensation for the  calendar
years 1984 through 1989.
 
     Postretirement benefits other than pensions consist of health care and life
insurance  benefits provided to a group of former employees who retired prior to
January 1, 1990, and a limited health care
 
                                      F-94
 
<PAGE>
                     GRANITEVILLE COMPANY AND SUBSIDIARIES
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
                               FEBRUARY 28, 1993
 
benefit program provided  to early retirees.  With the exception  of a group  of
retirees  who retired prior to  January 1, 1982, a portion  of the cost of these
benefits is paid by the retiree.
 
     Effective March  2, 1992  Graniteville adopted  SFAS 106  and  accordingly,
provided  for the unfunded  accumulated postretirement obligation  payments on a
pay-as-you-go basis; in 1992 and 1993 such payments were immaterial.
 
     Net other postretirement benefit expense  for Fiscal 1993 consisted of  the
following:
 
<TABLE>
<CAPTION>
                                                                                 (IN THOUSANDS)
<S>                                                                              <C>
Service cost -- benefit earned during the period..............................        $  7
Interest cost on accumulated postretirement benefit obligation................          88
                                                                                       ---
                                                                                      $ 95
                                                                                       ---
                                                                                       ---
</TABLE>
 
     The  accumulated postretirement benefit obligation  as of February 28, 1993
(which is equal  to the  amount which has  been recognized  in the  accompanying
consolidated balance sheet) consists of the following:
 
<TABLE>
<CAPTION>
                                                                                 (IN THOUSANDS)
<S>                                                                              <C>
Retirees and dependents.......................................................       $  935
Active employees eligible to retire...........................................           88
Active employees not eligible to retire.......................................          112
                                                                                    -------
                                                                                     $1,135
                                                                                    -------
                                                                                    -------
</TABLE>
 
     For  purposes of  measuring the  expected postretirement  obligation, a 12%
annual rate of increase in the per capita claims cost was assumed for 1994. This
rate is assumed to  decrease by 1% per  year to 6% in  the year 2000 and  remain
level  thereafter.  The  discount  rate  used  in  determining  the  accumulated
postretirement benefit obligation was 8%.
 
     If the health care  cost trend rate were  increased by 1%, the  accumulated
postretirement  benefit  obligation  as  of  the end  of  1993  would  have been
increased by 8%. The effect of this change on the service cost and interest cost
for 1993 would be an increase of 9%.
 
(8) TRANSACTIONS WITH AFFILIATES
 
     Triarc provided management services, excluding the cost of leased space, to
Graniteville in 1991,  1992, and  1993 at  a cost  of approximately  $3,592,000,
$1,792,000,  and  $2,441,000, respectively.  Such amounts  include approximately
$2,320,000, $640,000,  and $1,299,000,  in 1991,  1992 and  1993,  respectively,
representing  allocations  to  Graniteville in  accordance  with  the applicable
management services  agreement of  certain reserves  established by  Triarc  for
amounts  owed by certain corporations,  which may be deemed  to be or, deemed to
have been, affiliates of Graniteville in connection with the providing by Triarc
of such management  services. Graniteville,  through Triarc,  also leased  space
from  an affiliate for  approximately $944,000, $864,000,  and $824,000 in 1991,
1992, and 1993, respectively.
 
     Graniteville maintains certain property insurance coverage with  Chesapeake
Insurance  Company  Limited  ('Chesapeake  Insurance'),  an  affiliated  company
registered in Bermuda. Premiums attributable to such insurance coverage amounted
to $176,000 in 1991, $203,000 in  1992, and $212,000 in 1993. Graniteville  also
maintains  certain insurance coverage with an unaffiliated insurance company for
which Chesapeake  Insurance  reinsures  a  portion of  the  risk.  Net  premiums
attributable   to  such  reinsurance  were  approximately  $3,250,000  in  1991,
$3,047,000 in 1992,  and $2,619,000  in 1993.  In addition,  Insurance and  Risk
Management  Inc., an affiliated  company, acts as agent  or broker in connection
with insurance coverage obtained by Graniteville and provides claims  processing
services  for Graniteville. The commissions and  payments for such services paid
to such company were $469,000, $455,000,  and $459,000 in 1991, 1992, and  1993,
respectively.
 
                                      F-95
 
<PAGE>
                     GRANITEVILLE COMPANY AND SUBSIDIARIES
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
                               FEBRUARY 28, 1993
 
     During  1992, Graniteville invested $2,500,000 in the convertible preferred
stock of  Chesapeake  Insurance.  The  investment  is  valued  at  cost  in  the
accompanying financial statements and is included in 'Other assets'.
 
     Certain machinery and automotive equipment is leased from an affiliate (see
Note  6). Interest  charges on these  lease obligations amounted  to $158,000 in
1991, $97,000 in 1992, and $71,000 in 1993.
 
(9) LEGAL MATTERS
 
     In  September  1985,  Graniteville  was  notified  by  the  United   States
Department  of Labor that the  Department was prepared to  bring suit in Federal
District Court  to  seek  certain  corrective  action  in  connection  with  the
termination   of  Graniteville's   pension  plans   in  April   1983,  prior  to
Graniteville's acquisition by SEPSCO, unless Graniteville agreed to resolve  the
matter  through a consent order to be filed simultaneously with the complaint in
Federal  Court.  In   its  letter,  the   Department  sought  contributions   to
Graniteville's  ESOP or successor plan equal to the value of the surplus pension
plan assets returned to Graniteville upon termination of the plan (approximately
$36.0 million) plus  interest to the  date of  payment minus the  amount of  any
contributions  (alleged by the Department to aggregate approximately $9 million)
made since April 25, 1983, which were attributable to Graniteville's  commitment
with  respect to the surplus pension  plan assets. Although Graniteville entered
into discussions with the Department, no agreement could be reached.
 
     As a  result, in  April 1986,  the Department  commenced an  action in  the
United   States  District  Court  ('The   Court')  for  South  Carolina  against
Graniteville, SEPSCO,  and  certain individuals  who  had been  members  of  the
Executive  Committee  at the  time of  the plan  termination, and  certain other
individuals  who  are  alleged  to   have  been  fiduciaries  with  respect   to
Graniteville's  Employee Stock Ownership  Plan or a successor  plan prior to the
acquisition of Graniteville by SEPSCO. In its complaint, the Department  alleged
that  the  individual  defendants  violated  their  fiduciary  duties  under the
provisions of the Employee  Retirement Income Security Act  of 1974, as  amended
('ERISA'),  in failing to implement an alleged commitment purportedly made prior
to the acquisition of  Graniteville by SEPSCO to  utilize the approximately  $36
million  of  surplus  assets  received from  the  termination  of Graniteville's
pension plans solely for  the benefit of participants  and beneficiaries of  the
ESOP  (including a contribution  of approximately $7  million which Graniteville
announced in 1986  that it intended  to make  as a partial  satisfaction of  its
commitment  to the ESOP), by failing to take reasonable steps to acquire control
of property belonging to  the ESOP or  to realize upon claims  held by the  ESOP
with  respect to such  surplus assets. In  its action, the  Department sought to
enjoin the defendants from serving directly or indirectly as fiduciaries of  any
employment  plan covered by  ERISA for a  period of ten  years, enjoin the other
individual defendants from  committing any  future violations  of the  fiduciary
provisions  of ERISA and order the defendants, jointly and severally, to restore
any losses plus  interest incurred  as a  consequence of  the alleged  fiduciary
violations or participation in such alleged violations.
 
     In December 1990, Graniteville and the Department entered into a settlement
of  such litigation. Graniteville agreed to make and subsequently made a payment
of $20.7 million on February 28, 1991, and a payment of $8.5 million on February
28, 1992, to the trustee of the Graniteville Company Retirement Savings Plan  as
successor  to the ESOP. Graniteville believes that such cash payments completely
satisfy  its  commitment.   Included  in  'Other,   net'  in  the   accompanying
consolidated  statement  of earnings  for the  year  ended March  3, 1991,  is a
provision of $4.9 million representing the settlement costs in excess of amounts
previously provided.
 
     Graniteville participates in regional waste water treatment facilities  and
considers that it is in substantial compliance with water pollution regulations.
Graniteville  has, however,  been notified by  the South  Carolina Department of
Health  and  Environmental  Control  ('DHEC')   that  DHEC  has  found   certain
contamination  of  Langley  Pond  and  has  asserted  that  Graniteville  may be
responsible for such contamination. Graniteville  entered into a consent  decree
providing  for  the study  and investigation  of the  alleged pollution  and its
sources. The first  study report  was filed  with DHEC  on April  23, 1990,  and
recommended that pond sediments be left undisturbed and in place. DHEC responded
by requesting
 
                                      F-96
 
<PAGE>
                     GRANITEVILLE COMPANY AND SUBSIDIARIES
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
                               FEBRUARY 28, 1993
 
that Graniteville submit additional information concerning potential passive and
active  remedial  alternatives  with accompanying  supportive  information which
Graniteville provided  to DHEC  in  a report  of its  independent  environmental
consulting firm in May 1991. That report concluded that pond sediments should be
left   undisturbed  and  in  place  and  that  other  less  passive  remediation
alternatives either provided  no significant additional  benefits or  themselves
involved adverse effects on human health or to existing recreational uses or the
existing  biological communities. Given the passage of time since the submission
of Graniteville's report and the absence of desirable remediation  alternatives,
other  than  continuing  to  leave  the  Langley  Pond  sediments  in  place and
undisturbed as described in the  report, Graniteville believes it unlikely  that
such matter will have any material effect on the financial condition and results
of operations of Graniteville.
 
     Graniteville  has programs to identify and  resolve problems in the area of
emissions into the  atmosphere and  employee exposure to  toxic substances,  and
considers  that  it  is  presently  in  substantial  compliance  with applicable
regulations. Graniteville also has programs to identify and resolve problems  in
the  area  of  noise  mitigation.  Employee  testing  continues  to  be  pursued
vigorously.  Graniteville  has  responded  to  occupational  safety  matters  as
regulations  have  been  promulgated.  Graniteville  considers  that  it  is  in
substantial compliance with such safety matters under present standards.
 
     Revised cotton  dust  standards  became effective  March  27,  1986.  These
standards   have  required  increased  capital  expenditures,  changes  in  work
practices and  monitoring  of  personnel.  Compliance  with  such  standards  is
difficult  to attain and/or maintain as a technological matter, and Graniteville
believes it may  require capital  expenditures which are  presently expected  to
range  from $6 million  to $8 million.  Compliance with such  standards may also
require additional changes in  manufacturing processes, equipment, product  mix,
and  installation of additional air cleaning  equipment. Even with such actions,
compliance cannot be assured in all areas at all times.
 
     Graniteville and its  subsidiaries are  defendants in  certain other  legal
proceedings  arising  out  of the  conduct  of Graniteville's  business.  In the
opinion  of  management  and  counsel,  the  ultimate  outcome  of  these  legal
proceedings  will  not  have  a  material  adverse  effect  on  the consolidated
financial position or results of operations of Graniteville.
 
(10) RESTRUCTURING COSTS
 
     In the fourth quarter of 1992, Graniteville recorded a restructuring charge
of $2,500,000 representing costs and expenses associated with plans to cease the
manufacture and  sale  of cotton  yarns  and shuttle  woven,  industrial  greige
fabrics.  Actual costs and expenses  associated with the strategic restructuring
exceeded management's original estimate and  1993 results include an  additional
charge of $1,855,000. No further charges for this restructuring are anticipated.
 
(11) INCENTIVE COMPENSATION PLAN
 
     Graniteville  has in effect a  Management Incentive Compensation Plan which
provides for the establishment  for each fiscal year  of two separate  incentive
compensation  funds, the first  to be based primarily  on operating earnings and
not to exceed 10% of such earnings, and the second to be based on earnings  from
sales or other dispositions of assets, such as sales of subsidiaries, divisions,
investments  and other assets not in the ordinary course of business, and not to
exceed 10% of  earnings from such  sources. At  March 1, 1992  and February  28,
1993,  an aggregate  amount of approximately  $2.2 million and  $6.6 million was
available under such funds, respectively,  and is included in 'Accrued  salaries
and  wages'  in  the  accompanying  consolidated  balance  sheets.  During 1992,
Graniteville reversed $2.0 million of such incentive accruals relating to  prior
fiscal  years.  The Plans  are administered  by  the Compensation  Committee and
awards for elected  corporate officers are  approved by the  Board of  Directors
following review and recommendation by the Compensation Committee. The Plans set
forth  certain objective factors used in determining the allocation of awards to
persons eligible to participate in the Plans. Among such factors are experience,
level of  responsibility, efforts  expended, participation  in decision  making,
performance,   duties  and  responsibilities  and   length  of  employment.  The
objectives of
 
                                      F-97
 
<PAGE>
                     GRANITEVILLE COMPANY AND SUBSIDIARIES
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
                               FEBRUARY 28, 1993
 
the Plans  are  to  encourage the  development  of  aggressive,  growth-oriented
business  plans  and strategies  consistent with  philosophies  of the  Board of
Directors, to  motivate  exemplary  commitment  and  performance  of  managerial
personnel  who have made  a meaningful contribution  to Graniteville's financial
results and business objectives and to provide Graniteville's stockholders  with
an  optimum return  on their investment  by maximizing the  long-term growth and
profitability of Graniteville.
 
(12) FAIR VALUE OF FINANCIAL INSTRUMENTS
 
     SFAS No.  107,  'Disclosure about  Fair  Value of  Financial  Instruments,'
requires  that  the  estimated  fair  value  of  financial  instruments  and the
applicable underlying assumptions be disclosed as of February 28, 1993.
 
     Cash and equivalents -- The carrying amount approximates fair value because
of the short maturity of these instruments.
 
     Long-term  debt  --  Graniteville  refinanced  substantially  all  of   its
long-term   debt  in  December   1992.  Based  upon   this  recent  refinancing,
Graniteville estimates that the carrying  value of $62,705,000 approximates  the
fair value of long-term debt at February 28, 1993.
 
(13) SUBSEQUENT EVENT
 
     On  April 23, 1993,  Graniteville and Patrick entered  into an $180 million
senior secured credit facility (the 'Graniteville Credit Facility') with The CIT
Group/Commercial  Services,  Inc.  ('CIT').  This  refinancing  is  part  of   a
transaction,  one  of  the  purposes  of which  is  the  refinancing  of certain
indebtedness of Triac and its subsidiaries on improved terms and conditions.
 
     The Graniteville Credit  Facility consists  of a  senior secured  revolving
credit  facility of up to $100 million (the 'Revolving Loan') and an $80 million
senior secured term loan (the 'Term Loan'). The proceeds of borrowings under the
Graniteville Credit Facility were used  as follows: approximately $78.1  million
was  used to refinance existing indebtedness  of Graniteville, $66.6 million was
advanced to Triarc, approximately $28.8 million was used to cover Graniteville's
capital expenditure and  working capital needs,  and approximately $6.5  million
was  used  to pay  fees  and expenses  associated  with the  Graniteville Credit
Facility.
 
     As part of the  Graniteville Credit Facility, CIT  will continue to  factor
Graniteville's  sales, with credit balances  assigned to secure the Graniteville
Credit Facility. The factoring arrangement has a term of three years, subject to
automatic extension for  additional one-year periods  unless either party  gives
six  months' prior notice of termination.  Graniteville will pay a commission of
0.45% on all credit-approved accounts receivable. A 0.20% bad debt reserve  will
be  shared  equally  by CIT  and  Graniteville after  deducting  customer credit
losses.
 
     The Revolving Loan has a term of five years and will be in an amount of  up
to  $100 million with  a $5 million  sublimit for letters  of credit. Borrowings
under the Revolving Loan bear interest, at Graniteville's option, at either  the
prime rate plus 1.25% per annum or the 90-day London Interbank Offered Rate (the
'LIBOR  rate') plus 3.00% per annum. If the unpaid principal balance of the Term
Loan is less than $55 million, the  interest rate on the Revolving Loan will  be
reduced  to the prime  rate plus 1.00% per  annum or the  90-day LIBOR rate plus
2.75% per annum. All  LIBOR rate loans  will have a  90-day interest period  and
will be limited to $90 million in total borrowings under the Graniteville Credit
Facility.  The borrowing base for  the Revolving Loan will be  the sum of 90% of
accounts receivable which  are credit-approved by  the factor, plus  85% of  all
other  eligible accounts  receivable, plus  65% of  eligible inventory, provided
that advances against eligible inventory shall not exceed $35 million at any one
time.
 
     The Term Loan has a five-year term in an amount of up to the lesser of  (i)
$80  million or (ii) the sum of 75% of  the fair market value of real estate and
80% of  the  orderly liquidation  value  of  machinery and  equipment  owned  by
Graniteville  and Patrick. The Term Loan  will amortize $2.5 million per quarter
during the  first year  and $3  million  per quarter  thereafter, with  a  final
payment of $22
 
                                      F-98
 
<PAGE>
                     GRANITEVILLE COMPANY AND SUBSIDIARIES
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
                               FEBRUARY 28, 1993
 
million  on the fifth anniversary of the  closing. Until the unpaid principal of
the Term Loan is  equal to or  less than $60  million at the  end of any  fiscal
year,  Graniteville must make mandatory prepayments in an amount equal to 50% of
Excess Cash Flow, as defined, for such fiscal year. The Term Loan bears interest
at the prime rate plus 1.75% per annum  or the 90-day LIBOR rate plus 3.50%  per
annum.  When the  unpaid principal  balance of  the Term  Loan is  less than $55
million, the interest rate thereon will be reduced to the prime rate plus 1.375%
per annum or  the 90-day LIBOR  rate plus 3.125%  per annum. In  each case,  the
LIBOR  rate is limited to $90 million in total borrowings under the Graniteville
Credit Facility. In the event that Graniteville prepays the Term Loan, in  whole
or  in part, prior to the end of the  third year, then a prepayment fee shall be
payable as follows: 2%  of the amount  prepaid if the  prepayment occurs in  the
first  year, 1% of  the prepayment during the  second year and 1/2  of 1% in the
third year.
 
     The Graniteville  Credit  Facility is  secured  by  all of  the  assets  of
Graniteville  and  C.  H.  Patrick,  including  all  accounts  receivable, notes
(including the $66.6 million note  Graniteville received from Triarc in  respect
of  the intercompany  advance), inventory, machinery  and equipment, trademarks,
patents and other intangible assets, and all real estate. Graniteville has  also
pledged  as  collateral the  stock of  C. H.  Patrick. Additionally,  Triarc and
Graniteville International have given unlimited and unconditional guarantees  of
all  obligations under the Graniteville Credit  Facility. As collateral for such
guarantee, Triarc  pledged  (i) 51%  of  the  issued and  outstanding  stock  of
Graniteville (subject only to the existing pledge on such stock held by SEPSCO),
and (ii) at least 70% of the issued and outstanding common stock of SEPSCO.
 
     The  Graniteville Credit Facility contains various affirmative and negative
covenants. The affirmative covenants include maintenance of insurance  coverage,
payments of indebtedness and taxes when due, compliance with financial reporting
requirements,   and  delivery  of  certificates  of  non-default.  The  negative
covenants restrict dividends and  stock repurchases, investments, incurrence  of
indebtedness (purchase money security interests not exceeding $20 million at any
one  time outstanding are permitted), additional liens or guarantees, changes in
the nature of the business, mergers and acquisitions, changes in key  management
(unless  reasonably acceptable to the agent bank), changes in ownership control,
change of  fiscal year,  creation  of new  subsidiaries,  sales of  assets,  and
affiliate  transactions other than in the normal course of business as presently
conducted. The Graniteville Credit  Facility also contains financial  covenants,
including  covenants relating to current  ratio, working capital, debt-to-equity
ratio, net worth, earnings-to-interest  ratio, capital expenditures and  maximum
loss allowable.
 
     The   Graniteville   Credit  Facility   also  contains   customary  default
provisions, including defaults for nonpayment of principal, interest or fees due
under the Graniteville Credit  Facility, misrepresentations, noncompliance  with
covenants,  bankruptcy or insolvency, any of  the security interests or liens in
favor of  the lenders  ceasing to  be valid,  binding and  enforceable, and  any
unsatisfied  or unstayed  judgment in  excess of $1  million unless  the same is
being contested in good faith.
 
     If Graniteville becomes eligible to  join in Triarc's consolidated  Federal
income  tax return, Graniteville  will be permitted  to pay to  Triarc an amount
equal to the Federal income tax liability that Graniteville and its subsidiaries
would have paid  if they had  filed a separate  consolidated Federal income  tax
return.  Additionally, Graniteville will  be permitted to  pay dividends or make
loans or advances to its affiliates in an amount equal to 50% of the net  income
of  Graniteville  accumulated  from  the  beginning  of  the  first  fiscal year
commencing on  or  after  December  20,  1994,  provided  that  the  outstanding
principal  balance of the Term Loan is less  than $50 million at the time of the
payments and certain other conditions are met.
 
                                      F-99

<PAGE>
 
                     GRANITEVILLE COMPANY AND SUBSIDIARIES
                     CONDENSED CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
                                                                                        FEBRUARY 28,    NOVEMBER 28,
                                                                                          1993(A)           1993
                                                                                        ------------    ------------
                                                                                               (IN THOUSANDS)
                                                                                                (UNAUDITED)
<S>                                                                                     <C>             <C>
                                       ASSETS
Current assets:
     Cash and equivalents............................................................     $  1,235        $  3,499
     Receivables, net................................................................       65,463          81,255
     Inventories (Note 3)............................................................       81,150          99,873
     Deferred income taxes...........................................................        5,084           5,193
     Other current assets............................................................        1,326             574
                                                                                        ------------    ------------
          Total current assets.......................................................      154,258         190,394
                                                                                        ------------    ------------
Properties, net (Note 4).............................................................      105,472         110,635
Note receivable from parent (including accrued interest) (Note 2)....................       --              69,817
Other assets.........................................................................        3,634           6,255
                                                                                        ------------    ------------
                                                                                          $263,364        $377,101
                                                                                        ------------    ------------
                                                                                        ------------    ------------
                        LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
     Current portion of long-term debt...............................................     $  9,809        $ 11,657
     Accounts payable................................................................       24,750          24,686
     Accrued salaries and wages......................................................        8,275           8,567
     Deferred income taxes...........................................................       10,566          10,688
     Other current liabilities.......................................................        6,456          10,221
                                                                                        ------------    ------------
          Total current liabilities..................................................       59,856          65,819
Revolving debt (Note 2)..............................................................       --              85,195
Long-term debt (Note 2)..............................................................       52,896          64,650
Deferred income taxes................................................................       21,374          22,072
Other liabilities....................................................................        1,626           1,626
Commitments and contingencies
Stockholders' equity:
     Common stock, $5.00 par value; 10,000,000 shares authorized; 4,984,000 shares
      issued.........................................................................       24,920          24,920
     Additional paid-in capital......................................................       41,712          41,712
     Retained earnings...............................................................       60,980          71,107
                                                                                        ------------    ------------
          Total stockholders' equity.................................................      127,612         137,739
                                                                                        ------------    ------------
                                                                                          $263,364        $377,101
                                                                                        ------------    ------------
                                                                                        ------------    ------------
</TABLE>
 
- ------------
 
 (A) Derived from the audited financial statements as of February 28, 1993.
 
     See accompanying notes to condensed consolidated financial statements.
 
                                     F-100
 
<PAGE>
                     GRANITEVILLE COMPANY AND SUBSIDIARIES
                  CONDENSED CONSOLIDATED STATEMENTS OF INCOME
                                  (UNAUDITED)
 
<TABLE>
<CAPTION>
                                                                                           NINE MONTHS ENDED
                                                                                      ----------------------------
                                                                                      NOVEMBER 29,    NOVEMBER 28,
                                                                                          1992            1993
                                                                                      ------------    ------------
                                                                                             (IN THOUSANDS)
<S>                                                                                   <C>             <C>
Revenues...........................................................................     $378,039        $399,870
                                                                                      ------------    ------------
Costs and expenses:
     Cost of sales.................................................................      316,342         338,020
     Selling, general, and administrative expenses (Note 6)........................       25,669          32,154
     Facilities relocation and corporate restructuring (Note 6)....................       --               1,843
                                                                                      ------------    ------------
                                                                                         342,011         372,017
                                                                                      ------------    ------------
          Operating profit.........................................................       36,028          27,853
                                                                                      ------------    ------------
Other income (expense):
     Interest expense..............................................................       (7,151)        (10,612)
     Interest income...............................................................          176              76
     Interest income from parent (Note 2)..........................................       --               3,824
     Write-off of investment in Chesapeake Insurance Company Limited...............       --              (2,500)
     Other, net....................................................................           13             537
                                                                                      ------------    ------------
                                                                                          (6,962)         (8,675)
                                                                                      ------------    ------------
          Income before income taxes and cumulative effect of changes in accounting
            principles.............................................................       29,066          19,178
Provision for income taxes.........................................................      (10,952)         (9,051)
                                                                                      ------------    ------------
          Income before cumulative effect of changes in accounting principles......       18,114          10,127
Cumulative effect of changes in accounting for:
     Income taxes (Note 5).........................................................      (12,314)         --
     Postretirement benefits other than pensions, net of tax of $429,000 (Note
      5)...........................................................................         (722)         --
                                                                                      ------------    ------------
     Net income....................................................................     $  5,078        $ 10,127
                                                                                      ------------    ------------
                                                                                      ------------    ------------
</TABLE>
 
     See accompanying notes to condensed consolidated financial statements.
 
                                     F-101
 
<PAGE>
                     GRANITEVILLE COMPANY AND SUBSIDIARIES
                CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                  (UNAUDITED)
 
<TABLE>
<CAPTION>
                                                                                           NINE MONTHS ENDED
                                                                                      ----------------------------
                                                                                      NOVEMBER 29,    NOVEMBER 28,
                                                                                          1992            1993
                                                                                      ------------    ------------
                                                                                             (IN THOUSANDS)
<S>                                                                                   <C>             <C>
Cash flows from operating activities:
     Net income....................................................................     $  5,078        $ 10,127
     Adjustments to reconcile net income to net cash provided by (used in)
      operating activities:
          Depreciation and amortization............................................        7,842          10,066
          Amortization of deferred loan costs......................................       --                 782
          Increase in deferred income taxes, net of accounting changes.............       --                 711
          Provision for doubtful accounts..........................................          709             362
Write-off of investment in Chesapeake Insurance Company Limited....................       --               2,500
Cumulative effect of changes in accounting principles..............................       13,036          --
Other, net.........................................................................           49            (484)
Decrease (increase) in:
          Receivables..............................................................      (20,065)        (16,154)
          Inventories..............................................................        5,383         (18,723)
          Note receivable from Triarc..............................................       --              (3,217)
          Other current assets.....................................................           26             474
Increase (decrease) in:
          Accounts payable.........................................................        1,604             (64)
          Other current liabilities................................................        6,266           4,158
          Other liabilities........................................................          429          --
                                                                                      ------------    ------------
               Net cash and equivalents provided by (used in) operating
                  activities.......................................................       20,357          (9,462)
                                                                                      ------------    ------------
Cash flows from investing activities:
     Capital expenditures..........................................................       (4,331)        (14,336)
     Increase in note receivable from parent.......................................       --             (66,600)
     Proceeds from the sale of properties..........................................          471             537
     Other, net....................................................................           30              98
                                                                                      ------------    ------------
               Net cash and equivalents used in investing activities...............       (3,830)        (80,301)
                                                                                      ------------    ------------
Cash flows from financing activities:
     Decrease in short-term borrowings.............................................       (1,959)         --
     Repayment of long-term debt...................................................       (5,710)        (67,210)
     Additions to long-term debt:
          Term loan................................................................       --              80,000
          Revolving debt...........................................................       --              85,192
          Other....................................................................       --                  45
     Increase in deferred financing costs..........................................       --              (6,000)
     Payment of dividends on common stock..........................................       (6,132)         --
                                                                                      ------------    ------------
               Net cash and equivalents provided by (used in) financing
                  activities.......................................................      (13,801)         92,027
                                                                                      ------------    ------------
Net increase in cash and equivalents...............................................        2,726           2,264
Cash and equivalents at beginning of period........................................          838           1,235
                                                                                      ------------    ------------
Cash and equivalents at end of period..............................................     $  3,564        $  3,499
                                                                                      ------------    ------------
                                                                                      ------------    ------------
</TABLE>
 
     See accompanying notes to condensed consolidated financial statements.
 
                                     F-102
 
<PAGE>
                     GRANITEVILLE COMPANY AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                               NOVEMBER 28, 1993
                                  (UNAUDITED)
 
(1) BASIS OF PRESENTATION
 
     Graniteville  Company ('Graniteville')  is 51%  owned subsidiary  of Triarc
Companies, Inc. (formerly DWG  Corporation and referred  to herein as  'Triarc')
and  49% owned by Southeastern Public Service Company (a 71% owned subsidiary of
Triarc).
 
     The accompanying unaudited condensed  consolidated financial statements  of
Graniteville  have been prepared in accordance with Rule 10-01 of Regulation S-X
promulgated by the  Securities and  Exchange Commission and,  therefore, do  not
include  all  information and  footnotes necessary  for  a fair  presentation of
financial position,  results of  operations and  cash flows  in conformity  with
generally  accepted accounting  principles and,  accordingly, should  be read in
conjunction with  Graniteville's annual  audited financial  statements  included
elsewhere  herein.  In the  opinion of  Graniteville, however,  the accompanying
financial statements  contain all  adjustments, which  include normal  recurring
adjustments  and certain significant charges (See  Note 6), necessary to present
fairly Graniteville's financial position  as of February  28, 1993 and  November
28,  1993 and its results  of operations and its cash  flows for the nine months
ended November 29, 1992 and November 28, 1993.
 
     On October 27, 1993, Graniteville's Board of Directors approved a change in
the fiscal  year of  Graniteville from  February 28  to a  calendar year  ending
December 31 effective for the transition period ended December 31, 1993. As used
herein,  'Graniteville Fiscal 1993'  refers to the year  ended February 28, 1993
and 'Graniteville Transition 1993' refers to  the ten months ended December  31,
1993.
 
(2) CHANGE IN CONTROL
 
     As  previously  reported, a  change  in control  of  Graniteville's parent,
Triarc, occurred on April 23, 1993, which  as a result of Triarc's ownership  of
Graniteville's voting securities constituted a change in control of Graniteville
(the  'Change in Control'). In connection with  the Change in Control, the Board
of Directors of Graniteville was reconstituted and new senior executive officers
were elected.
 
     On April 23, 1993, Graniteville entered into an $180 million senior secured
credit  facility   (the   'Graniteville   Credit   Facility')   with   the   CIT
Group/Commercial  Services, Inc.  ('CIT'). Proceeds  of the  Graniteville Credit
Facility in the amount  of $66.6 million were  advanced to Triarc. In  addition,
approximately  $78.1 million was  used to refinance  existing indebtedness, $6.5
million was used to pay fees and expenses associated with the new facility,  and
the  remaining  amount  of approximately  $28.8  million  at April  23,  1993 is
available for future capital expenditure and working capital needs.
 
(3) INVENTORIES
 
     The following is a summary of the major classifications of inventories:
 
<TABLE>
<CAPTION>
                                                                              FEBRUARY 28,    NOVEMBER 28,
                                                                                  1993            1993
                                                                              ------------    ------------
                                                                                     (IN THOUSANDS)
<S>                                                                           <C>             <C>
Raw materials..............................................................     $ 15,696        $ 17,021
Work in process............................................................        5,516           6,020
Finished goods.............................................................       57,512          74,230
Supplies...................................................................        2,426           2,602
                                                                              ------------    ------------
                                                                                $ 81,150        $ 99,873
                                                                              ------------    ------------
                                                                              ------------    ------------
</TABLE>
 
                                     F-103
 
<PAGE>
                     GRANITEVILLE COMPANY AND SUBSIDIARIES
      NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
                               NOVEMBER 28, 1993
                                  (UNAUDITED)
 
(4) PROPERTIES
 
     The following is a summary of the components of properties, net:
 
<TABLE>
<CAPTION>
                                                                              FEBRUARY 28,    NOVEMBER 28,
                                                                                  1993            1993
                                                                              ------------    ------------
<S>                                                                           <C>             <C>
Properties, at cost........................................................     $160,187        $170,596
Less accumulated depreciation and amortization.............................       54,715          59,961
                                                                              ------------    ------------
                                                                                $105,472        $110,635
                                                                              ------------    ------------
                                                                              ------------    ------------
</TABLE>
 
(5) ACCOUNTING CHANGES
 
     Effective March 1, 1992 Graniteville adopted the provisions of Statement of
Financial Accounting  Standards No.  109 'Accounting  for Income  Taxes'  ('SFAS
109')  and  Statement  of  Financial Accounting  Standards  No.  106 'Employers'
Accounting for Postretirement  Benefits Other than  Pensions' ('SFAS 106').  The
cumulative effect of the changes in accounting principles resulted in charges to
Graniteville's  consolidated statement  of income  amounting to  $12,314,000 for
SFAS 109 and $722,000,  net of taxes  of $429,000, for  SFAS 106. These  changes
have  been retroactively  reflected in  the condensed  consolidated statement of
income in the first quarter of Graniteville Fiscal 1993.
 
(6) SIGNIFICANT CHARGES IN TRANSITION 1993
 
     The accompanying condensed  consolidated statement of  income includes  the
following  significant  charges recorded  in the  first quarter  of Graniteville
Transition 1993,  net  of adjustments  recorded  during the  second  quarter  of
Graniteville Transition 1993 (in thousands):
 
<TABLE>
<CAPTION>
<S>                                                                                                <C>
Estimated cost allocated to Graniteville by Triarc to terminate the lease on Triarc's existing
  corporate headquarters.......................................................................   $1,614
Costs allocated to Graniteville by Triarc related to a five-year consulting agreement extending
  through April 1998 between Triarc and the former Vice Chairman of Triarc.....................      229
                                                                                                  ------
     Total facilities relocation and corporate restructuring costs(A)..........................    1,843
Estimated cost allocated to Graniteville by Triarc for compensation paid to the Triarc Special
  Committee of the Board of Directors of Triarc................................................    1,660
Income tax benefit relating to the above charges...............................................   (1,179)
                                                                                                  ------
                                                                                                  $2,324
                                                                                                  ------
                                                                                                  ------
</TABLE>
 
- ------------
 
 (A) In  the first quarter  of Graniteville Transition  1993, net of adjustments
     recorded during the second quarter of Graniteville Transition 1993, results
     of operations  were significantly  impacted  by facilities  relocation  and
     corporate   restructuring  charges  allocated  to  Graniteville  by  Triarc
     aggregating $1,843,000  consisting of:  (i)  estimated allocated  costs  of
     $1,614,000  to  relocate Triarc's  existing  corporate headquarters  and to
     terminate the  lease  on  its existing  corporate  facilities;  (ii)  total
     allocated  costs of $229,000  relating to a  five-year consulting agreement
     (the 'Consulting Agreement')  extending through April  1998 between  Triarc
     and  Steven Posner, the former Vice Chairman of Triarc. All of such charges
     are related to  the Change in  Control of  Triarc described in  Note 2.  In
     connection  with the  Change in  Control, Victor  Posner and  Steven Posner
     resigned as officers  and directors of  Triarc. In order  to induce  Steven
     Posner  to resign, Triarc  entered into the  Consulting Agreement with him.
     The allocated cost related  to the Consulting Agreement  was recorded as  a
     charge  in the  first quarter of  Graniteville Transition  1993 because the
     Consulting Agreement does not require  any substantial services and  Triarc
     does  not expect to receive any  services that will have substantial value.
     As a  part  of the  Change  in Control,  Triarc's  Board of  Directors  was
     reconstituted.  The  first  meeting  of  Triarc's  reconstituted  Board  of
     Directors was held on April  24, 1993. At that  meeting, based on a  report
     and recommendations from a management consulting firm that had conducted an
     extensive  review of  Triarc's and subsidiaries'  operations and management
     structure, Triarc's Board of Directors approved a plan of  decentralization
     and  restructuring  which  entailed,  among  other  things,  the  following
     features: (i) the strategic decision to manage Triarc and its  subsidiaries
     in   the  future   on  a  decentralized   rather  than   on  a  centralized
 
                                     F-104
 
<PAGE>
                     GRANITEVILLE COMPANY AND SUBSIDIARIES
      NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
                               NOVEMBER 28, 1993
                                  (UNAUDITED)
 
    basis; (ii)  the hiring  of new  executive officers  for Triarc;  (iii)  the
     termination  of a significant number  of employees as a  result of both the
     new management  philosophy  and  the  hiring  of  an  almost  entirely  new
     management  team; and (iv) the relocation  of the corporate headquarters of
     Triarc and certain  of its subsidiaries.  Graniteville's allocated cost  to
     relocate  the corporate headquarters  of Triarc and  terminate the lease on
     Triarc's  existing  corporate  facilities  ($1,614,000)  stemmed  from  the
     decentralization  and restructuring plan formally  adopted at the April 24,
     1993 meeting of Triarc's reconstituted Board of Directors and  accordingly,
     were recorded in the first quarter of Graniteville Transition 1993.
 
 (B) In  accordance with certain court proceedings and related settlements, five
     directors, including  three court-appointed  directors, were  appointed  in
     1991  to serve on  a special committee (the  'Triarc Special Committee') of
     Triarc's Board of  Directors. Such  committee was empowered  to review  and
     pass  on transactions  between Triarc and  Victor Posner,  the then largest
     shareholder of Triarc,  and his affiliates.  Graniteville has been  charged
     $1,660,000 as an allocation of the cash portion of a success fee payable to
     the  Triarc  Special  Committee attributable  to  the  reorganization which
     occurred in connection  with the Change  in Control. Such  amount has  been
     provided   in  'Selling,  general  and   administrative  expenses'  in  the
     accompanying condensed  consolidated statement  of  earnings in  the  first
     quarter of Graniteville Transition 1993.
 
                                     F-105

<PAGE>
                                                                    EXHIBIT 11.1
 
                    TRIARC COMPANIES, INC. AND SUBSIDIARIES
                           LOSS PER SHARE COMPUTATION
                    (IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
 
<TABLE>
<CAPTION>
                                                                                                                    SIX MONTHS
                                                                                                                       ENDED
                                                                      YEAR ENDED APRIL 30,                          OCTOBER 31,
                                                     -------------------------------------------------------    -------------------
                                                      1989        1990        1991        1992        1993       1992        1993
                                                     -------    --------    --------    --------    --------    -------    --------
                                                                                                                    (UNAUDITED)
<S>                                                  <C>        <C>         <C>         <C>         <C>         <C>        <C>
Primary
  Loss from continuing operations.................   $(5,851)   $(13,966)   $(17,501)   $(10,207)   $(44,549)   $(4,398)   $(19,628)
  Cumulative preferred stock dividend
     requirements:
     Redeemable Convertible Preferred Stock.......     --          --          --          --           (112)     --         (2,916)
     $.35 preferred stock.........................      (576)        (13)        (10)        (10)         (8)        (5)      --
     $.60 preferred stock.........................        (4)         (1)         (1)         (1)         (1)     --          --
                                                     -------    --------    --------    --------    --------    -------    --------
  Adjusted loss from continuing operations........    (6,431)    (13,980)    (17,512)    (10,218)    (44,670)    (4,403)    (22,544)
  Discontinued operations.........................     3,250       1,072         (55)      2,705      (2,430)     2,016      (7,168)
  Extraordinary items.............................     1,807       1,363         703       --         (6,611)     --           (448)
  Cumulative effect of changes in accounting
     principles...................................     --          --          --          --         (6,388)    (6,388)      --
                                                     -------    --------    --------    --------    --------    -------    --------
          Adjusted net loss.......................   $(1,374)   $(11,545)   $(16,864)   $ (7,513)   $(60,099)   $(8,775)   $(30,160)
                                                     -------    --------    --------    --------    --------    -------    --------
                                                     -------    --------    --------    --------    --------    -------    --------
  Common stock and equivalents:
     Average common shares outstanding(1).........    16,669      25,428      25,853      25,867      25,808     25,893      21,239
                                                     -------    --------    --------    --------    --------    -------    --------
                                                     -------    --------    --------    --------    --------    -------    --------
  Income (loss) per share:(2)
     From continuing operations...................   $  (.39)   $   (.55)   $   (.68)   $   (.39)   $  (1.73)   $  (.17)   $  (1.06)
     Discontinued operations......................       .20         .04       --            .10        (.09)       .08        (.34)
     Extraordinary items..........................       .11         .06         .03       --           (.26)     --           (.02)
     Cumulative effect of changes in accounting
       principles.................................     --          --          --          --           (.25)      (.25)      --
                                                     -------    --------    --------    --------    --------    -------    --------
                                                     $  (.08)   $   (.45)   $   (.65)   $   (.29)   $  (2.33)   $  (.34)   $  (1.42)
                                                     -------    --------    --------    --------    --------    -------    --------
                                                     -------    --------    --------    --------    --------    -------    --------
</TABLE>
 
- ------------
 
(1) The  effect of common stock equivalents has not been included since they are
    anti-dilutive.
 
(2) Fully diluted  net  loss  per  share was  not  applicable  since  contingent
    issuances of common shares would have been anti-dilutive.
 
                                     F-106
 
<PAGE>
                                                                    EXHIBIT 11.1
                                                     (continued from prior page)
 
                    TRIARC COMPANIES, INC. AND SUBSIDIARIES
                      PRO FORMA LOSS PER SHARE COMPUTATION
                    (IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
                                  (UNAUDITED)
 
<TABLE>
<CAPTION>
                                                                                           PRO FORMA FOR THE
                                                                                       COMPLETED TRANSACTIONS AND
                                                                                         THE SEPSCO SETTLEMENT
                                                                                   ----------------------------------
                                                                                     YEAR ENDED      SIX MONTHS ENDED
                                                                                   APRIL 30, 1993    OCTOBER 31, 1993
                                                                                   --------------    ----------------
<S>                                                                                <C>               <C>
     Pro forma loss from continuing operations..................................      $(50,114)          $(20,574)
     Pro forma cumulative preferred stock dividend requirements:
          Redeemable Convertible Preferred Stock(1).............................        (5,833)            (2,916)
          $.35 preferred stock..................................................            (8)           --
          $.60 preferred stock..................................................            (1)           --
                                                                                   --------------    ----------------
          Adjusted pro forma income loss from continuing operations.............      $(55,956)          $(23,490)
                                                                                   --------------    ----------------
                                                                                   --------------    ----------------
     Common stock and equivalents:
       Average common shares outstanding(2).....................................        25,808             21,239
       Pro forma effects of:
          833,332 shares of Triarc Class A Common Stock issued to Merrill
            Lynch/DLJ Investors in the Equity Transactions......................           817            --
          5,982,866 shares of Triarc Class A Common Stock acquired by Triarc
            from Victor Posner in exchange for the same number of Triarc's
            Redeemable Convertible Preferred Stock in the Equity Transactions...        (5,868)           --
          268,000 shares of restricted Triarc Class A Common Stock granted to
            certain key employees of Triarc in connection with the
            Restructuring.......................................................           263            --
          2,691,822 shares of Triarc Class A Common Stock issued to SEPSCO
            shareholders other than Triarc in connection with the SEPSCO
            Settlement..........................................................         2,692              2,692
                                                                                   --------------    ----------------
     Pro forma adjusted average common shares outstanding.......................        23,712             23,931
                                                                                   --------------    ----------------
                                                                                   --------------    ----------------
     Pro forma loss per share:(3)
          From continuing operations............................................      $  (2.36)          $   (.98)
                                                                                   --------------    ----------------
                                                                                   --------------    ----------------
</TABLE>
 
- ------------
 
(1) Reflects the historical preferred stock dividend requirements adjusted as if
    the Redeemable Convertible Preferred Stock were issued on May 1, 1992.
 
(2) The  effect of common stock equivalents has not been included since they are
    antidilutive.
 
(3) Fully diluted  net  loss  per  share was  not  applicable  since  contingent
    issuances of common shares would have been antidilutive.
 
                                     F-107

<PAGE>
                                                                         ANNEX I
 
                          AGREEMENT AND PLAN OF MERGER
                                  BY AND AMONG
                      SOUTHEASTERN PUBLIC SERVICE COMPANY,
                         SEPSCO MERGER CORPORATION AND
                             TRIARC COMPANIES, INC.
 
                         DATED AS OF NOVEMBER 22, 1993
 
                                      A-1

<PAGE>
                               TABLE OF CONTENTS
                            ------------------------
 <TABLE>
<CAPTION>
                                                                                                            PAGE
                                                                                                            -----
                                                   ARTICLE ONE
                                                   THE MERGER
<S>                                             <C>                                                            <C>
SECTION 1.1     The Merger...............................................................................       1
SECTION 1.2     Certificate of Incorporation.............................................................       1
SECTION 1.3     By-Laws..................................................................................       1
SECTION 1.4     Board of Directors and Officers..........................................................       1
SECTION 1.5     Meeting of Company Stockholders..........................................................       2
SECTION 1.6     SEC Filings..............................................................................       2
SECTION 1.7     Effective Time of the Merger.............................................................       2
                                                   ARTICLE TWO
                                              CONVERSION OF SHARES
SECTION 2.1     Conversion of Shares.....................................................................       3
SECTION 2.2     No Further Transfers.....................................................................       3
SECTION 2.3     Exchange of Shares of Company Common Stock...............................................       3
                                                  ARTICLE THREE
                               ADDITIONAL AGREEMENTS IN CONNECTION WITH THE MERGER
SECTION 3.1     Best Efforts.............................................................................       4
SECTION 3.2     Conduct of Business by the Company Pending the Merger....................................       5
SECTION 3.3     Restrictions on Issuance of Shares.......................................................       5
SECTION 3.4     Notice of Actions and Proceedings........................................................       6
SECTION 3.5     Access and Information...................................................................       6
SECTION 3.6     Notification of Certain Other Matters....................................................       6
                                                  ARTICLE FOUR
                                  REPRESENTATIONS AND WARRANTIES OF THE COMPANY
SECTION 4.1     Organization and Good Standing...........................................................       7
SECTION 4.2     Authorization; Binding Agreement.........................................................       7
SECTION 4.3     Capitalization...........................................................................       7
SECTION 4.4     Reports and Financial Statements.........................................................       7
SECTION 4.5     Litigation...............................................................................       8
SECTION 4.6     Governmental Approvals and Compliance with Law...........................................       8
SECTION 4.7     Absence of Breach........................................................................       8
SECTION 4.8     Proxy Statement; Registration Statement..................................................       8
                                                  ARTICLE FIVE
                              REPRESENTATIONS AND WARRANTIES OF PARENT AND MERGERCO
SECTION 5.1     Organization and Good Standing...........................................................       9
SECTION 5.2     Authorization; Binding Agreement.........................................................       9
SECTION 5.3     Capitalization...........................................................................       9
SECTION 5.4     Reports and Financial Statements.........................................................       9
SECTION 5.5     Litigation...............................................................................      10
SECTION 5.6     Company Representations..................................................................      10
SECTION 5.7     Governmental Approvals...................................................................      10
SECTION 5.8     Absence of Breach........................................................................      10
SECTION 5.9     Proxy Statement; Registration Statement..................................................      10
</TABLE>
 
<PAGE>


<TABLE>
<CAPTION>
 
                                                   ARTICLE SIX
                                         COVENANTS FOLLOWING THE MERGER
                                                                                                              PAGE
                                                                                                             ----
<S>             <C>                                                                                          <C>
SECTION 6.1     Indemnification..........................................................................      11
SECTION 6.2     Further Action...........................................................................      11
                                                  ARTICLE SEVEN
                                                   CONDITIONS
SECTION 7.1     Conditions to Each Party's Obligation to Effect the Merger...............................      12
SECTION 7.2     Conditions to Obligation of the Company to Effect the Merger.............................      12
SECTION 7.3     Conditions to Obligations of Parent and Mergerco to Effect the Merger....................      13
                                                  ARTICLE EIGHT
                                                   TERMINATION
SECTION 8.1     Termination..............................................................................      14
SECTION 8.2     Effect of Termination....................................................................      14
                                                  ARTICLE NINE
                                               GENERAL AGREEMENTS
SECTION 9.1     Non-Survival of Representations, Warranties and Agreements...............................      14
SECTION 9.2     Closing..................................................................................      15
SECTION 9.3     Expenses.................................................................................      15
SECTION 9.4     Notice...................................................................................      15
SECTION 9.5     Amendments...............................................................................      16
SECTION 9.6     Waiver...................................................................................      16
SECTION 9.7     Brokers..................................................................................      16
SECTION 9.8     Publicity................................................................................      16
SECTION 9.9     Subsidiaries.............................................................................      16
SECTION 9.10    Headings.................................................................................      16
SECTION 9.11    Non-Assignability........................................................................      16
SECTION 9.12    Counterparts.............................................................................      16
SECTION 9.13    Governing Law............................................................................      17
</TABLE>
<PAGE>
                          AGREEMENT AND PLAN OF MERGER
 
     AGREEMENT  AND PLAN OF MERGER, dated as  of November 22, 1993 (this 'Merger
Agreement'), by  and  among  Southeastern Public  Service  Company,  a  Delaware
corporation  (the  'Company'),  Triarc  Companies,  Inc.,  an  Ohio  corporation
formerly known as DWG Corporation  ('Parent'), and SEPSCO Merger Corporation,  a
Delaware  corporation  and  a wholly-owned  subsidiary  of  Parent ('Mergerco').
Mergerco and the Company are  hereinafter sometimes collectively referred to  as
the 'Constituent Corporations.'
 
     Following  the  favorable recommendation  of the  Special Committee  of the
Board of  Directors of  the  Company (the  'Special  Committee'), the  Board  of
Directors of each of Parent, Mergerco and the Company has approved the merger of
Mergerco  with and  into the  Company (the 'Merger')  pursuant to  the terms and
subject to  the conditions  of this  Merger Agreement  whereby (i)  each of  the
issued and outstanding shares of common stock, par value $1.00 per share, of the
Company ('Company Common Stock'), other than shares of Company Common Stock held
by  Parent and its  subsidiaries (as defined  in Section 9.9  hereof) and shares
held in the  treasury of the  Company and by  any of its  subsidiaries, will  be
converted  into  the right  to  receive the  Merger  Consideration set  forth in
Section 2.1(b)  hereof,  (ii) each  of  the  issued and  outstanding  shares  of
Preferred  Stock, Series  B, par  value $50.00  per share,  of the  Company (the
'Company Preferred Stock'), all  of the issued and  outstanding shares of  which
are  owned by  Parent, will be  cancelled, and  (iii) the Company  will become a
wholly-owned subsidiary of the Parent.
 
     NOW, THEREFORE, the parties hereto agree as follows:
 
                                   ARTICLE I
                                   THE MERGER
 
     SECTION 1.1 The  Merger. Subject to  the terms and  conditions hereof,  the
Merger  shall be consummated in accordance with  the DGCL as soon as practicable
following the satisfaction or waiver of the conditions set forth in Article  VII
hereof.  Upon the terms and  subject to the conditions  hereof, at the Effective
Time (as defined in Section 1.7 hereof), Mergerco shall be merged with and  into
the  Company in accordance  with the applicable  provisions of the  DGCL and the
separate existence of Mergerco  shall thereupon cease, and  the Company, as  the
surviving  corporation  in  the  Merger  (the  'Surviving  Corporation'),  shall
continue its corporate existence  under the laws of  the State of Delaware.  The
Merger shall have the effects set forth in Section 259 of the DGCL.
 
     SECTION  1.2 Certificate of Incorporation. The Certificate of Incorporation
of the Company as in effect immediately prior to the Effective Time shall be the
Certificate  of  Incorporation   of  the  Surviving   Corporation,  until   such
Certificate  of  Incorporation  is  thereafter  further  changed  or  amended as
provided therein or by law, except that at the Effective Time Article Fourth  of
the  Certificate of Incorporation of the  Surviving Corporation shall be amended
to read as follows: 'The  total number of shares of  stock of all classes  which
the  Corporation has  authority to  issue is 1,000  shares of  Common Stock, par
value $1.00 per share.'
 
     SECTION 1.3 By-Laws. The by-laws of Mergerco as in effect immediately prior
to the Effective Time  shall be the by-laws  of the Surviving Corporation  until
thereafter  changed or amended as provided  therein or as otherwise permitted or
required by the Surviving Corporation's Certificate of Incorporation or by law.
 
     SECTION 1.4 Board of Directors and Officers. (a) The directors of  Mergerco
at  the  Effective  Time  shall  be  the  initial  directors  of  the  Surviving
Corporation and shall serve until  their respective successors are duly  elected
or  appointed  and  qualify  in  the  manner  provided  in  the  Certificate  of
Incorporation and by-laws of the Surviving Corporation, or as otherwise provided
by law.
 
     (b) The officers of the Company at the Effective Time shall be the officers
of the Surviving Corporation and  shall serve until their respective  successors
are  duly  elected  or appointed  and  qualify  in the  manner  provided  in the
Certificate of Incorporation  and by-laws  of the Surviving  Corporation, or  as
otherwise provided by law.
 
                                       1
 
<PAGE>
     SECTION  1.5 Meeting  of Company Stockholders.  The Company  shall take all
necessary action in accordance with applicable  law to convene a meeting of  its
stockholders  (a 'Meeting') to consider and vote upon the Merger and this Merger
Agreement and shall use  its best efforts  to hold such  Meeting as promptly  as
practicable  after  the date  hereof. Subject  to  applicable law  and fiduciary
duties, including the duties of loyalty and care, the Board of Directors of  the
Company  shall recommend  that the Company's  stockholders vote in  favor of the
Merger and the adoption of this Agreement. Parent agrees that it shall vote,  or
cause  to be voted, in favor of the  Merger and the adoption and approval of the
Merger Agreement each share  of Company Common Stock  and each share of  Company
Preferred  Stock held by it or by any of its subsidiaries on the record date set
by the Company  for determining  shares of Company  Common Stock  and shares  of
Company Preferred Stock entitled to vote at the Meeting.
 
     SECTION  1.6 SEC Filings. (a) The Company has filed with the Securities and
Exchange Commission (the 'SEC'), pursuant to the Securities and Exchange Act  of
1934,  as amended (the 'Exchange Act'), a proxy statement and form of proxy with
respect to  the  Meeting (the  'Proxy  Statement'). Parent  and  Mergerco  shall
provide the Company with the information concerning Parent and Mergerco required
to be included in the Proxy Statement.
 
     (b)  As soon as practicable, Parent shall  file with the SEC a registration
statement on Form S-4 (the 'Registration Statement') under the Securities Act of
1933, as amended (the 'Securities Act'),  which registers the shares of Class  A
Common  Stock, par  value $.10  per share  ('Parent Class  A Common  Stock'), of
Parent to be issued  to the Company's stockholders  pursuant to the Merger.  The
Company  and  Mergerco  shall  provide Parent  with  information  concerning the
Company and Mergerco required to be included in the Registration Statement.
 
     (c) The Company  and Parent shall  (i) provide such  cooperation as may  be
necessary or useful to cause the Registration Statement to incorporate the Proxy
Statement  and shall  (ii) use all  reasonable efforts to  have the Registration
Statement declared effective under  the Securities Act  and the Proxy  Statement
cleared  by the  SEC as promptly  as practicable, and  (iii) promptly thereafter
mail the Proxy Statement to stockholders  of the Company. The Parent also  shall
take  any action required to be taken under state blue sky or securities laws in
connection with  the Merger  and the  issuance of  the Merger  Consideration  in
connection   therewith.  The  term  'Registration  Statement'  shall  mean  such
Registration Statement  at the  time  it becomes  effective and  all  amendments
thereto duly filed and similarly mailed.
 
     (d)  The  information provided  and  to be  provided  by the  Company (with
respect to itself and its subsidiaries), Parent (with respect to itself and  its
subsidiaries)  and Mergerco, respectively, for use in the Registration Statement
and the Proxy Statement  shall, at the time  the Registration Statement  becomes
effective,  on the  date the  Proxy Statement is  first mailed  to the Company's
stockholders and  on the  date  of the  meeting  of the  Company's  stockholders
referred  to in Section 1.5 hereof, be true and correct in all material respects
and shall not omit to state any  material fact required to be set forth  therein
or  necessary in order to make the  information set forth therein not misleading
and the  Company, Parent  and Mergerco  each agree  to correct  any  information
provided  by it  for use  in the Registration  Statement or  the Proxy Statement
which shall have become false and misleading. The Registration Statement and the
Proxy Statement  shall comply  as to  form  in all  material respects  with  all
applicable requirements of federal securities laws.
 
     SECTION  1.7 Effective Time of the Merger. As soon as practicable following
the satisfaction or waiver of the conditions set forth in Article VII hereof,  a
Certificate  of Merger shall be  duly executed by the  Company and shall be duly
filed with the Secretary of State of  Delaware in accordance with the DGCL.  The
Merger  shall become effective when such Certificate  of Merger is so filed with
the  Secretary  of  State  of  Delaware.  Under  no  circumstances  shall   such
Certificate  of Merger be filed  prior to the satisfaction  of the condition set
forth in Section 7.1(d) hereof. When used in this Agreement, the term 'Effective
Time' shall mean the  time and date  at which such Certificate  of Merger is  so
filed.
 
                                       2
 
<PAGE>
                                   ARTICLE II
                              CONVERSION OF SHARES
 
     SECTION  2.1 Conversion of Shares. At the  Effective Time, by virtue of the
Merger and without any action on the part of the holder thereof:
 
          (a) Each  share  of Company  Common  Stock  then owned  by  Parent  or
     Mergerco  or by any direct or indirect subsidiary of Parent and shares held
     in the treasury of the Company or  by any direct or indirect subsidiary  of
     the  Company (each of the foregoing  shares being 'Excluded Shares') shall,
     by virtue of  the Merger,  and without  any action  on the  Company or  the
     holder thereof, be cancelled.
 
          (b) Each then remaining issued and outstanding share of Company Common
     Stock  not cancelled pursuant to  Section 2.1(a) shall be  by virtue of the
     Merger, and without any action on the part of the holder thereof, cancelled
     and converted solely into the right  to receive, upon the surrender of  the
     certificate  formerly representing  such share  of Company  Common Stock in
     accordance with Section 2.3 hereof, 0.8 of a fully paid and  non-assessable
     share  of Parent Class A Common Stock, without interest thereon. The shares
     of Parent Class A Common Stock to  be issued in the Merger in exchange  for
     certificates  which  immediately prior  to  the Effective  Time represented
     shares of  Company Common  Stock, together  with any  cash to  be  received
     pursuant  to Paragraph  (e) of  Section 2.3  in lieu  of issuing fractional
     shares of  Parent Class  A Common  Stock,  are referred  to herein  as  the
     'Merger Consideration.'
 
          (c)  Each then issued and outstanding share of Preferred Stock, Series
     B Convertible par value  $50.00 per share  ('Company Preferred Stock'),  of
     the Company, all of which are, as of the date of this Merger Agreement, and
     will be, as of the Effective Time, owned by the Parent, will be cancelled.
 
          (d)  Each then  issued outstanding  share of  Common Stock,  par value
     $1.00 per share ('Mergerco  Common'), of Mergerco  shall be converted  into
     one fully paid and nonassessable share of common stock, par value $1.00 per
     share, of the Surviving Corporation.
 
          SECTION  2.2 No Further Transfers. At  the Effective Time, the Company
     Common Stock and the Company Preferred Stock transfer books shall be closed
     and no  further transfer  of  shares of  Company  Common Stock  or  Company
     Preferred Stock shall thereafter be made. If, after the Effective Time, any
     certificate  previously  representing  shares of  Company  Common  Stock is
     presented for transfer,  it shall be  forwarded to the  Exchange Agent  (as
     defined  in Section 2.3 hereof) for cancellation and exchange in accordance
     with Section 2.3 hereof.
 
          SECTION 2.3 Exchange of  Shares of Company  Common Stock.(a) Prior  to
     the  Effective Time, Parent shall designate a  bank or trust company to act
     as exchange agent (the 'Exchange Agent') for the Merger. Immediately  prior
     to  the  Effective Time,  Parent will  instruct the  transfer agent  of the
     shares of Parent  Class A Common  Stock to countersign  and deliver to  the
     Exchange  Agent a sufficient number of certificates representing the shares
     of Parent Class A Stock, all so  as to allow for the issuance and  delivery
     of  the  Merger  Consideration on  a  timely  basis. Parent  shall  pay all
     reasonable charges or expenses, including  those of the Exchange Agent,  in
     connection  with the exchange of the shares of Company Common Stock for the
     Merger Consideration.
 
          (b) As  soon as  practicable after  the Effective  Time, Parent  shall
     cause  the Exchange Agent to mail and/or make available to each holder of a
     certificate theretofore representing shares of the Company Common Stock  (a
     'Certificate') (other than holders of certificates theretofore representing
     Excluded Shares) a notice and letter of transmittal advising such holder of
     the  effectiveness of the Merger and  the procedure for surrendering to the
     Exchange Agent such Certificate or Certificates for exchange for the Merger
     Consideration multiplied by the  number of shares  of Company Common  Stock
     represented  by such Certificate or Certificates. Upon the surrender to the
     Exchange Agent of such Certificate or Certificates, together with a  letter
     of  transmittal,  duly  executed  and  completed  in  accordance  with  the
     instructions thereon, the holder of such Certificate or Certificates  shall
     be  entitled  to  receive  the Merger  Consideration.  From  and  after the
     Effective Time, until surrendered in accordance with the provisions of this
     Section 2.3, each  Certificate evidencing  shares of  Company Common  Stock
     (other than Certificates represent-
                                       3
 
<PAGE>
     ing Excluded Shares and Dissenting Shares) shall represent for all purposes
     only  the right to  receive the Merger  Consideration, without any interest
     thereon. Any portion of the Merger  Consideration that shall not have  been
     paid  to stockholders of the Company pursuant  to this Section 2.3 prior to
     the second anniversary of  the Effective Time  (including any cash  payable
     pursuant  to Section  2.3(e) hereof)  shall be paid  to the  Parent and any
     stockholders of the  Company who  have not theretofore  complied with  this
     Section  2.3 thereafter  shall look, subject  to escheat  and other similar
     laws, solely to the Parent for payment of the Merger Consideration to which
     they are entitled under this Agreement.
 
          (c) No dividends or other distributions that are otherwise payable  on
     the  shares of Parent Class  A Common Stock constituting  any of the Merger
     Consideration will be paid to  the holder of any unsurrendered  Certificate
     until  such Certificate is properly surrendered as provided herein, but (i)
     upon such surrender, there shall  be paid to the  person in whose name  the
     shares  of  Parent Class  A  Common Stock  constituting  any of  the Merger
     Consideration shall be issued the amount of any dividends which shall  have
     become  payable with respect to such  shares between the Effective Time and
     the time of such surrender and (ii)  at the appropriate payment date or  as
     soon  thereafter as  practicable, there  shall be  paid to  such person the
     amount of any dividends on such shares of Parent Class A Common Stock which
     shall have a record or due date prior to such surrender and a payment  date
     after  such surrender, subject in each such case to (x) deduction therefrom
     of any  amount required  by applicable  law  to be  withheld, and  (y)  any
     applicable  escheat  laws or  unclaimed property  laws.  On surrender  of a
     Certificate, no interest shall  be payable with respect  to the payment  of
     such  dividends and no interest shall be payable with respect to the amount
     of any cash payable in lieu of a fractional share of Parent Class A  Common
     Stock pursuant to paragraph (e) of this Section 2.3.
 
          (d)  If  any cash  is to  be paid  pursuant to  Section 2.3(e)  to, or
     certificates representing shares of Parent Class  A Common Stock are to  be
     issued  to, a person other than the person in whose name the Certificate so
     surrendered in exchange therefor is registered, it shall be a condition  of
     the  payment or issuance thereof that  the Certificate so surrendered shall
     be properly endorsed and otherwise in proper form for transfer and that the
     person requesting  such exchange  shall  pay any  transfer or  other  taxes
     required by reason of the payment of cash to a person other than, or if the
     issuance  of certificates representing the shares  of Parent Class A Common
     Stock in  any  name  other than  that  of,  the registered  holder  of  the
     Certificate  surrendered, or otherwise required,  or shall establish to the
     satisfaction of the Exchange Agent  that such tax has  been paid or is  not
     applicable.
 
          (e)  Shares of  Parent Class  A Common Stock  shall be  issued only in
     whole shares. Former holders of Company  Common Stock will not be  entitled
     to  receive fractional shares  of Parent Class  A Common Stock ('Fractional
     Shares') but,  instead,  will be  entitled  to receive  promptly  from  the
     Exchange  Agent a cash  payment in lieu  of Fractional Shares  in an amount
     equal to such former  holders' proportionate interest  in the net  proceeds
     from  the sale or sales in the open market by the Exchange Agent, on behalf
     of all such former holders, of the aggregate Fractional Shares. Such  sales
     shall be made promptly after the Effective Time. Such cash payments will be
     made  to each such former holder only  upon proper surrender of such former
     holder's Certificates, together with a properly completed and duly executed
     transmittal form and any other required documents.
 
                                  ARTICLE III
              ADDITIONAL AGREEMENTS IN CONNECTION WITH THE MERGER
 
     SECTION 3.1 Best  Efforts. Upon  the terms  and subject  to the  conditions
herein  provided, each of the  parties hereto agrees to  use its best efforts to
take, or cause to be taken, all lawful  action, to do, or cause to be done,  and
to  assist and  cooperate with  the other  parties hereto  in doing,  all things
necessary,  proper  or  advisable  under  applicable  laws  and  regulations  to
consummate   and  make  effective,  as   soon  as  reasonably  practicable,  the
transactions contemplated by  this Merger Agreement,  including (i) the  Merger,
(ii)  the obtaining of consents, amendments to or waivers under the terms of any
material borrowing  arrangements  or  other  material  contractual  arrangements
required  by the transactions  contemplated by this  Merger Agreement, and (iii)
the defending of any  lawsuits or other legal  proceedings, whether judicial  or
administrative,   challenging  this   Agreement  or  the   consummation  of  the
 
                                       4
 
<PAGE>
transactions contemplated hereby. Each of the parties hereto agrees not to  take
or  to fail to take, as the case may  be, any action, the taking of which or the
failure of which  to take,  as the case  may be,  would be likely  to cause  any
representation  or warranty  contained in this  Merger Agreement to  cease to be
true or accurate in any material respect  or that would be reasonably likely  to
prevent  the  performance  in  all  material respects  of  any  covenant  or the
satisfaction of any condition contained  in this Merger Agreement. In  addition,
Parent,  either in its capacity  as a stockholder of  the Company or through its
nominees on the Company's Board of Directors (which shall be understood to  mean
those directors of the Company who are not members of the Special Committee), in
each  case subject to the exercise of their respective fiduciary duties, if any,
to the Company's stockholders, agrees not to  take or fail to take, as the  case
may  be, any action, the taking or failure of which to take, as the case may be,
would be likely to cause any representation or warranty of the Company contained
in this Merger Agreement to cease to be true or accurate in any material respect
or that would be  reasonable likely to prevent  the performance in all  material
respects  by the Company of  any covenant or the  satisfaction by the Company of
any condition contained in this Merger Agreement.
 
     SECTION 3.2 Conduct of Business by the Company Pending the Merger.  Subject
to  the last sentence  of Section 3.1  hereof, the Company  covenants and agrees
that, prior  to the  Effective  Time, unless  Parent  shall otherwise  agree  in
writing, or as otherwise contemplated by this Agreement:
 
          (a)  neither the Company  nor any subsidiary of  the Company shall (i)
     amend its certificate of incorporation  or by-laws, (ii) change the  number
     of  authorized or outstanding shares of its  capital stock, as set forth in
     Section 4.3 hereof,  or (iii)  declare, set aside  or pay  any dividend  or
     other  distribution, or  make any  payment in  cash, stock  or property, in
     respect of any shares  of its capital stock,  except for regular  dividends
     and/or  distributions declared  and/or paid  (x) by  any subsidiary  of the
     Company to the Company or  any other subsidiary of  the Company, or (y)  on
     presently outstanding shares of Company Preferred Stock;
 
          (b)  neither the Company  nor any subsidiary of  the Company shall (i)
     authorize for issuance, issue, grant, sell, pledge or dispose of or propose
     to issue, grant,  sell pledge  or dispose of  any shares  of, or  warrants,
     options,  commitments, subscriptions or  rights of any  kind to acquire any
     shares of,  the capital  stock of  the Company  or such  subsidiary or  any
     securities  convertible into or exchangeable for shares of any such capital
     stock, (ii) incur any material  indebtedness for borrowed money other  than
     in  the  ordinary  and  usual  course  of  business,  consistent  with past
     practice,  or  (iii)  acquire  directly  or  indirectly  by  redemption  or
     otherwise  any shares of the capital stock of the Company or any subsidiary
     of the Company;
 
          (c) neither the Company nor any subsidiary of the Company shall  enter
     into  any  agreement or  take  any other  action to  do  any of  the things
     described in paragraphs (a) or (b) of this Section 3.2 or which would  make
     any  representation or warranty of the  Company set forth in this Agreement
     which is  qualified as  to materiality  untrue or  incorrect and  any  such
     representation  or warranty which is not  so qualified materially untrue or
     incorrect.
 
     SECTION 3.3 Restrictions  on Issuance  of Shares.(a)  Parent covenants  and
agrees  that prior  to the  Effective Time,  unless the  Company shall otherwise
agree thereto in writing, Parent shall not issue any shares of its capital stock
(or issue or  grant any  options, warrants  or other  securities evidencing  the
right  to acquire, prior to the Effective Time, shares of its capital stock upon
the exercise or  conversion thereof  (collectively 'Rights'))  to any  executive
officer  or director of Parent,  or any affiliate of  Parent or any such person,
other than (i) upon exercise  of Rights outstanding on  the date of this  Merger
Agreement,  (ii) pursuant  to the  Equity Plan (as  defined in  Section 5.3), or
(iii) upon receipt of consideration equal to  at least the fair market value  of
the shares of Parent capital stock issued in respect thereof (or, in the case of
the  issuance of shares of  capital stock upon the  exercise of any Right issued
subsequent to  the  date  of  this  Agreement,  upon  receipt  of  consideration
(including the consideration, if any, received by Parent for the issuance of the
Right)  equal to at least the  fair market value, as of  the date of issuance of
the Right, of  the shares of  Parent capital  stock to be  issued upon  exercise
thereof).  Any non-cash consideration shall be valued in good faith by the Board
of Directors of Parent.
 
     (b) Parent covenants  and agrees that  it shall issue  no shares of  Parent
Common  Stock (as defined in Section 5.3 hereof), or Rights to acquire shares of
Parent Common Stock, subsequent to October 18,
 
                                       5
 
<PAGE>
1993 (the date  on which the  Stipulation of Settlement  (as defined in  Section
7.1(d)  hereof) was executed) and prior to the Effective Time, which will have a
materially dilutive economic effect  upon the Parent  Common Stock, except  that
the  following shall not be deemed to have any such materially dilutive economic
effect for purposes  hereof: (i)  the granting  of stock  options or  restricted
stock  awards so  that the aggregate  number of  shares of Parent's  stock to be
issued upon  the  issuance  of  such  restricted  stock  awards,  and  upon  the
conversion  of such stock options, does not exceed 3,500,000 shares; or (ii) the
issuance or  potential issuance  of  shares of  Parent  Common Stock,  upon  the
election  to convert by any holders, at such  holders' option, of all or some of
the shares  of  Parent  Convertible  Preferred Stock  or  any  other  series  of
convertible   preferred  stock   or  other  convertible   securities  of  Parent
outstanding on October 18, 1993; or (iii) the issuance or potential issuance  of
shares  of  Parent  Common  Stock  in  connection  with  an  underwritten public
offering; or (iv) the issuance or potential issuance of shares of Parent  Common
Stock  at not less  than fair market value,  as determined in  good faith by the
Board of Directors of Parent; or (v) any other such issuance of shares of Parent
Common Stock, so long as the number of shares of Parent Class A Common Stock  to
be  received in exchange for  each share of SEPSCO  Common Stock pursuant to the
terms  of  the  Stipulation  of   Settlement  and  this  Merger  Agreement   are
appropriately adjusted.
 
     SECTION  3.4 Notice of  Actions and Proceedings.  Each party promptly shall
notify  the  others  of  any  claims,  actions,  proceedings  or  investigations
commenced  or,  to  the best  of  its  knowledge, threatened,  and  any material
developments  relating  to  any  such  pending  claim,  action,  proceeding   or
investigation  involving or  affecting the parties,  or any  of their respective
properties or  assets,  or,  to the  best  of  its knowledge,  any  employee  or
consultant  of  the parties,  in his  or her  capacity as  such, or  director or
officer, in his or her capacity as such, of the Company or the Parent  disclosed
in  writing pursuant to Section 4.5 or 5.5 hereof, as the case may be, or which,
if pending on the date hereof, would  have been required to have been  disclosed
in  writing pursuant to Section 4.5 or 5.5  hereof, as the case may be, or which
relate to the consummation of the Merger.
 
     SECTION 3.5 Access and Information. Each  party shall, and shall cause  its
subsidiaries, officers, directors, employees and agents to, afford to each other
party  and  such party's  accountants,  counsel, financial  advisors, investment
bankers and other agents and representatives, and its banks and other  financial
institutions, full access at all reasonable times throughout the period prior to
the Effective Time to all of the officers, employees, agents, properties, books,
contracts, commitments and records (including but not limited to tax returns) of
such  party  and its  subsidiaries  and, during  such  period, such  party shall
furnish promptly to each  other party (i)  a copy of  each report, schedule  and
other  document  filed  by  it  or  any  of  its  subsidiaries  pursuant  to the
requirements of federal or state securities laws, and (ii) all other  financial,
operating   and  other  information  concerning  the  business,  properties  and
personnel of such party and its subsidiaries as each other party may  reasonably
request.
 
     SECTION  3.6  Notification of  Certain Other  Matters. Each  party promptly
shall notify the others of: (i)  any notice of, or other communication  relating
to, a default or event which, with notice or lapse of time or both, would become
a  default, received by such party or  any of its subsidiaries subsequent to the
date of  this  Merger Agreement  and  prior to  the  Effective Time,  under  any
agreement,   indenture  or  instrument  material  to  the  financial  condition,
properties, business or results of operations of such party and its subsidiaries
taken as a whole to which such party or any of its subsidiaries is a party or is
subject; (ii) any notice  or other communication from  any third party  alleging
that  the consent of such  third party is or may  be required in connection with
the transactions  contemplated by  this Merger  Agreement; (iii)  any notice  or
other  communication  from  any  regulatory  authority  in  connection  with the
transactions contemplated  hereby;  (iv)  any material  adverse  change  in  the
financial  condition, properties,  businesses or  results of  operations of such
party and its  subsidiaries taken  as a  whole, or  the occurrence  of an  event
which, so far as reasonably can be foreseen at the time of its occurrence, would
result  in  any such  change;  or (v)  any  matter hereafter  arising  which, if
existing, occurring or known  at the date of  this Merger Agreement, would  have
been required to be disclosed to such other party.
 
                                       6
 
<PAGE>
                                   ARTICLE IV
                 Representations and Warranties of the Company
     The Company represents and warrants to Parent and Mergerco as follows:
 
     SECTION  4.1 Organization  and Good Standing.  The Company and  each of its
subsidiaries are each a  duly incorporated and  validly existing corporation  in
good  standing  under the  laws  of the  state  of its  incorporation,  with all
requisite power and authority  (corporate and other) to  own its properties  and
conduct  its  business and  each is  duly qualified  and in  good standing  as a
foreign corporation authorized to  do business in each  of the jurisdictions  in
which  the character of  the properties owned or  held under lease  by it or the
nature of  the business  transacted by  it makes  such qualification  necessary,
except  where the failure to  be so qualified would not  in the aggregate have a
material adverse effect on the business, assets, properties, financial condition
or results of operations of  the Company and its  subsidiaries taken as a  whole
(in  respect of  either the  Company and  its subsidiaries  taken as  a whole or
Parent and its subsidiaries taken  as a whole, as the  case may be, a  'Material
Adverse  Effect'). The Company  has heretofore delivered to  the Parent true and
correct copies of its certificate of  incorporation and by-laws as currently  in
effect.
 
     SECTION 4.2 Authorization; Binding Agreement. The Company has all requisite
corporate  power and authority to execute  and deliver this Merger Agreement and
to consummate the transactions contemplated hereby, subject only to the adoption
of the Merger Agreement  by the Required Stockholder  Votes (as defined  below).
The  Company's Board of  Directors (at a  meeting duly called  and held) has (a)
duly approved the Merger Agreement and determined that the Merger is fair to and
in the best interests of the  Company's stockholders (other than Parent and  its
subsidiaries) and (b) adopted resolutions recommending approval of the Merger by
the  Company's  stockholders. Smith  Barney Shearson  Inc. ('Smith  Barney') has
delivered to the Special Committee of the Board of Directors of the Company  its
written  opinion in the form  of Exhibit A hereto  (the 'Fairness Opinion'). The
execution and delivery  of this  Merger Agreement  and the  consummation of  the
transactions  contemplated hereby have  been duly and  validly authorized by the
Company's Board  of  Directors and,  except  for  the adoption  of  this  Merger
Agreement  by (i) the stockholders of the Company holding at least a majority of
the outstanding  stock  of  the  Company entitled  to  vote  thereon,  (ii)  the
stockholders of the Company holding at least 66 2/3% of the outstanding stock of
the  Company  entitled to  vote thereon  which  is not  owned by  an 'interested
stockholder' of the Company, within the meaning in Section 203 of the DGCL,  and
(iii)  the holders  of not  less than  two-thirds of  the outstanding  shares of
Company Preferred  Stock  (the  stockholder votes  described  in  the  foregoing
clauses  (i), (ii)  and (iii)  being collectively  referred to  as the 'Required
Stockholder Votes'), no other corporate proceedings  on the part of the  Company
are   necessary  to  authorize  this   Merger  Agreement  and  the  transactions
contemplated hereby. This Merger  Agreement has been  duly and validly  executed
and  delivered  by  the Company,  and  constitutes  a legal,  valid  and binding
agreement of the Company, enforceable against the Company in accordance with its
terms (except  as  enforceability  may be  limited  by  bankruptcy,  insolvency,
moratorium or other similar laws affecting creditors' rights generally or by the
principles governing the availability of equitable remedies).
 
     SECTION  4.3 Capitalization. As of the  date hereof, the authorized capital
stock of the Company consists of  25,000,000 shares of Company Common Stock  and
267,600 shares of Company Preferred Stock. As of the date hereof, (a) 11,655,067
shares  of Company Common Stock were outstanding;  and (b) 490 shares of Company
Preferred Stock were outstanding.  There is not now,  and at the Effective  Time
there  will not be,  any existing option, warrant,  subscription or other right,
agreement or  commitment  which either  obligates  the  Company or  any  of  its
subsidiaries  to issue,  sell or  transfer any  shares of  its capital  stock or
restricts the  transfer of  or otherwise  relates to  the capital  stock of  the
Company or any of its subsidiaries.
 
     SECTION  4.4 Reports and Financial Statements. The Company has delivered to
Parent true and complete copies of (i) the Company's Annual Reports on Form 10-K
for the fiscal year ended February 28, 1993, as amended, as filed with the  SEC,
(ii)  all  other  reports,  statements  and  registration  statements (including
quarterly reports on Form 10-Q and current reports on Form 8-K) filed by it with
the SEC  since  March 1,  1993  (collectively,  the 'SEC  Filings').  Except  as
expressly  amended by  a subsequent SEC  Filing, and except  for information set
forth therein relating to companies which are not
 
                                       7
 
<PAGE>
subsidiaries of the Company ('Non-Subsidiaries of the Company'), as to which  no
representation  is given by the  Company, as of their  respective dates, the SEC
Filings did not contain any untrue statement of a material fact or omit to state
any material  fact  required to  be  stated therein  or  necessary to  make  the
statements  therein, in light  of the circumstances under  which they were made,
not misleading. The historical consolidated financial statements of the  Company
included  in the SEC Filings were prepared in accordance with generally accepted
accounting principles applied on a  consistent basis (except as otherwise  noted
in  such historical  financial statements)  and present  fairly the consolidated
financial position, results of operations  and changes in financial position  of
the  Company  and its  consolidated subsidiaries  as  of the  dates and  for the
periods indicated  (subject, in  the  case of  any unaudited  interim  financial
statements,  to  normal  year end  adjustments),  except that  the  footnotes to
quarterly financial statements do not contain all of the disclosures required by
generally accepted accounting principles.
 
     SECTION 4.5 Litigation. Except  as may be disclosed  in the SEC Filings  or
has  been disclosed  to Parent in  writing on or  prior to the  date hereof, and
except with  respect  to  Non-Subsidiaries  of  the  Company,  as  to  which  no
representation  is given, as of  the date hereof, there  are no claims, actions,
proceedings or investigations pending or, to the best knowledge of the  Company,
threatened, involving or affecting the Company or any of its subsidiaries or any
of  their properties or assets  or, to the best  of the Company's knowledge, any
employee, consultant, director or officer in his or her capacity as such, of the
Company or  any  of  its  subsidiaries  before  any  court  or  governmental  or
regulatory  authority or body which, if adversely decided, could have a Material
Adverse Effect.  As of  the date  hereof, neither  the Company  nor any  of  its
subsidiaries  nor any property or assets of any of them is subject to any order,
judgment, injunction or decree  that singly or in  the aggregate has a  Material
Adverse Effect.
 
     SECTION  4.6 Governmental  Approvals and  Compliance with  Law. No consent,
license, approval, qualification or form  of exemption from or authorization  of
or   declaration,  registration  or  filing  with  any  governmental  agency  or
regulatory authority, domestic  or foreign, on  the part of  the Company or  any
subsidiary of the Company which has not been made is required in connection with
the  execution  or  delivery  by  the  Company  of  this  Merger  Agreement, the
consummation by  the Company  of  the transactions  contemplated hereby  or  the
performance  by  the Company  of its  obligations hereunder  other than  (a) the
filing of a Certificate  of Merger with  the Secretary of  State of Delaware  in
accordance  with the DGCL, (b) filings with  the SEC and any applicable national
securities  exchanges,  (c)  filings  under  state  securities,  'Blue  Sky'  or
anti-takeover  laws,  (d)  any applicable  filings  required under  the  laws of
foreign jurisdictions  and (e)  filings, authorizations,  consents or  approvals
relating to matters which, in the aggregate, are not material to the Company and
its subsidiaries taken as a whole.
 
     SECTION  4.7 Absence of Breach.  Except as has been  disclosed to Parent in
writing on  or prior  to the  date hereof,  the execution  and delivery  by  the
Company   of  this  Merger  Agreement,  the  consummation  of  the  transactions
contemplated hereby  and  the performance  by  the Company  of  its  obligations
hereunder,  will not  (a) subject to  obtaining the  Required Stockholder Votes,
conflict with or result in a breach of any of the provisions of its  Certificate
of  Incorporation or by-laws,  (b) subject to the  obtaining of the governmental
and other consents referred to in  Section 4.6 hereof, contravene any law,  rule
or regulations of any state or of the United States or any political subdivision
thereof   or  therein,  or  any   order,  writ,  judgment,  injunction,  decree,
determination or award currently in effect or (c) require any consent,  approval
or  notice under or  result in a violation  or breach of  or constitute (with or
without due notice  or lapse of  time or both)  a default (or  give rise to  any
right  of termination,  cancellation, or acceleration)  under any  of the terms,
conditions or  provisions  of  any note,  bond,  mortgage,  indenture,  license,
agreement or other instrument to which the Company or any of its subsidiaries is
a party or by which any of their other assets are bound, the failure of which to
obtain, in each such case, would have a Material Adverse Effect.
 
     SECTION   4.8  Proxy   Statement;  Registration  Statement.   None  of  the
information included in the Proxy Statement filed by the Company, or provided by
the Company for  inclusion in the  Registration Statement filed  by the  Parent,
will  be false or misleading  with respect to any material  fact or will omit to
state any material fact required to be  stated therein or necessary in order  to
make  the statements therein, in light of the circumstances under which they are
made, not  misleading. Except  for information  supplied or  to be  supplied  by
Parent   and  Mergerco   for  inclusion   therein,  including   all  information
 
                                       8
 
<PAGE>
concerning subsidiaries  of  Parent and  in  which  the Company  is  a  minority
stockholder,  as  to  which  the  Company  makes  no  representation,  the Proxy
Statement, including  any  amendments  thereto,  will  comply  in  all  material
respects with the Exchange Act and the rules and regulations thereunder.
 
                                   ARTICLE V
             REPRESENTATIONS AND WARRANTIES OF PARENT AND MERGERCO
 
     Parent  and Mergerco, jointly  and severally, represent  and warrant to the
Company as follows:
 
     SECTION 5.1  Organization  and  Good  Standing.  Parent  and  each  of  its
subsidiaries  (including Mergerco) is  a duly incorporated  and validly existing
corporation in good standing under the  laws of the state of its  incorporation,
with  all  requisite  power  and  authority (corporate  and  other)  to  own its
properties and conduct its business and  is duly qualified and in good  standing
as  a foreign corporation authorized to do business in each of the jurisdictions
in which the character of the properties owned or held under lease by it or  the
nature  of the  business transacted  by it  makes such  qualification necessary,
except where the failure to  be so qualified would  not have a Material  Adverse
Effect.  Parent and Mergerco  have heretofore delivered  to the Company accurate
and complete  copies  of their  respective  corporate charters  and  by-laws  or
regulations as currently in effect.
 
     SECTION  5.2 Authorization; Binding Agreement.  Each of Parent and Mergerco
has the requisite  corporate power  and authority  to execute  and deliver  this
Merger  Agreement and  to consummate  the transactions  contemplated hereby, the
execution and delivery  of this  Merger Agreement  and the  consummation of  the
transactions  contemplated hereby have  been duly and  validly authorized by the
Board of Directors  of each of  Parent and Mergerco  and by Parent  as the  sole
stockholder of Mergerco and no other corporate proceedings on the part of Parent
or   Mergerco  are  necessary  to  authorize   this  Merger  Agreement  and  the
transactions contemplated  hereby.  This  Merger Agreement  has  been  duly  and
validly  executed and delivered by Parent  and Mergerco and constitutes a legal,
valid and binding agreement of Parent and Mergerco, enforceable against each  of
them  in accordance with its  terms (except as enforceability  may be limited by
bankruptcy, insolvency, moratorium  or other similar  laws affecting  creditors'
rights  generally or by  the principles governing  the availability of equitable
remedies).
 
     SECTION 5.3 Capitalization. As  of the date of  this Merger Agreement,  the
authorized capital stock of Parent consists of 75,000,000 shares of Parent Class
A  Common Stock, 12,000,000 shares  of Class B Common  Stock, par value $.10 per
share ('Parent Class  B Common Stock'  and together with  Parent Class A  Common
Stock,  'Parent Common Stock'), 6,000,000 shares of Parent Convertible Preferred
Stock, 5,000,000 shares  of Serial  Preferred Stock,  par value  $.10 per  share
('Serial  Preferred  Stock'), and  2,000,000 shares  of Junior  Serial Preferred
Stock, par value  $.10 per share  ('Junior Serial Preferred  Stock'). As of  the
date  hereof, 21,323,160  shares of  Parent Class  A Common  Stock and 5,982,866
shares of  Convertible Preferred  Stock were  outstanding, no  shares of  Parent
Class  B Common Stock,  Serial Preferred Stock or  Junior Serial Preferred Stock
were outstanding,  and 4,985,722  shares of  Parent Class  B Common  Stock  were
reserved   for  issuance  upon  conversion   of  outstanding  shares  of  Parent
Convertible Preferred Stock. The 1993 Amended and Restated Equity  Participation
Plan  (the 'Equity Plan') provides  for a maximum of  3,500,000 shares of Parent
Class A Common Stock to be granted  to officers, directors and key employees  of
Parent  and  subsidiaries, as  restricted  stock or  issued  on the  exercise of
options. The  authorized capital  stock  of Mergerco  consists solely  of  1,000
shares  of Mergerco Common, all of which, as  of the date hereof, are issued and
outstanding and held by Parent. All  of the outstanding shares of capital  stock
of  Parent and its  subsidiaries (including Mergerco)  have been duly authorized
and validly issued  and are fully  paid and  nonassessable and, in  the case  of
Parent's  capital stock,  free of  preemptive rights.  Upon consummation  of the
Merger, each share of Parent Class A  Common Stock issued as part of the  Merger
Consideration   will  be  duly  authorized,   validly  issued,  fully  paid  and
non-assessable.
 
     SECTION 5.4 Reports and Financial  Statements. Parent has delivered to  the
Company true and complete copies of (i) Parent's Annual Reports on Form 10-K for
the  fiscal year ended April 30, 1993, as filed with the SEC, and (ii) all other
reports, statements and registration statements (including quarterly reports  on
Form 10-Q and current reports on Form 8-K) filed by it with the SEC since May 1,
 
                                       9
 
<PAGE>
1993  (collectively, the 'Parent  SEC Filings'). Except  as expressly amended by
subsequent Parent SEC Filings,  and except with respect  to the Company and  any
subsidiaries  of  the Company  ('Non-Subsidiaries of  Parent'),  as to  which no
representation is given, as  of their respective dates,  the Parent SEC  Filings
did  not contain any  untrue statement of a  material fact or  omit to state any
material fact required to be stated therein or necessary to make the  statements
therein,  in  light  of  the  circumstances  under  which  they  were  made, not
misleading. The historical consolidated financial statements of Parent  included
in  the Parent SEC  Filings were prepared in  accordance with generally accepted
accounting principles applied on a  consistent basis (except as otherwise  noted
in  such historical  financial statements)  and present  fairly the consolidated
financial position, results of operations  and changes in financial position  of
Parent  and its consolidated  subsidiaries as of  the dates and  for the periods
indicated (subject, in the case  of any unaudited interim financial  statements,
to  normal  year-end  adjustments),  except  that  the  footnotes  to  quarterly
financial statements do not contain all of the disclosures required by generally
accepted accounting principles.
 
     SECTION 5.5  Litigation. Except  as  may be  disclosed  in the  Parent  SEC
Filings  or has been disclosed to the Company in writing on or prior to the date
hereof, and except with  respect to Non-Subsidiaries of  Parent, as to which  no
representation  is given, as of  the date hereof, there  are no claims, actions,
proceedings or  investigations pending  or,  to the  best knowledge  of  Parent,
threatened,  involving or affecting Parent or any of its subsidiaries (including
Mergerco) or any of their properties or assets before any court or  governmental
or  regulatory  authority or  body  which, if  adversely  decided, could  have a
Material Adverse Effect. As of  the date hereof, neither  Parent nor any of  its
subsidiaries  (including Mergerco) nor any property or  assets of any of them is
subject to  any order,  judgment, injunction  or decree  that singly  or in  the
aggregate has a Material Adverse Effect.
 
     SECTION  5.6  Company  Representations.  As  of  the  date  of  this Merger
Agreement, Parent does not know of any material inaccuracy in any representation
or warranty of the Company set forth in Article IV of this Merger Agreement.
 
     SECTION 5.7  Governmental  Approvals.  No  consent,  license,  approval  or
authorization  of  or declaration,  regulation or  filing with  any governmental
agency or regulatory authority,  domestic or foreign, on  the part of Parent  or
Mergerco which has not been made is required in connection with the execution or
delivery  by Parent  or Mergerco of  this Merger Agreement,  the consummation by
Parent and Mergerco of the  transactions contemplated hereby or the  performance
by  each of  Parent and Mergerco  of its respective  obligations hereunder other
than (i) the filing of  a Certificate of Merger with  the Secretary of State  of
Delaware  in  accordance  with the  DGCL,  (ii)  filings with  the  SEC  and any
applicable national securities exchanges, (iii) filings under state  securities,
'Blue  Sky' or antitakeover laws, (iv) any applicable filings required under the
laws of  foreign  jurisdictions and  (v)  filings, authorizations,  consents  or
approvals  relating  to matters  which, in  the aggregate,  are not  material to
Parent and its subsidiaries  (including Mergerco but  excluding the Company  and
its subsidiaries) taken as a whole.
 
     SECTION  5.8 Absence of Breach. Except as has been disclosed to the Company
in writing on or prior to the date hereof, the execution and delivery by  Parent
and  Mergerco of  this Merger  Agreement, the  consummation of  the transactions
contemplated hereby  and  the  performance  by  Parent  and  Mergerco  of  their
respective  obligations hereunder, will not (a) require the approval of Parent's
stockholders, (b) conflict with or result in  a breach of any of the  provisions
of their respective certificates of incorporation or by-laws, (c) subject to the
obtaining  of the  governmental and  other consents  referred to  in Section 5.7
hereof, contravene any law,  rule or regulation  of any state  or of the  United
States  or any  political subdivision  thereof or  therein, or  any order, writ,
judgment, injunction, decree, determination or award currently in effect or  (d)
require any consent, approval or notice under or result in a violation or breach
of  or  constitute (with  or without  due notice  or  lapse of  time or  both) a
default, or give rise to any right of termination, cancellation or  acceleration
under  any of the terms,  conditions or provisions of  any note, bond, mortgage,
indenture, agreement  or  other  instrument  to  which  Parent  or  any  of  its
subsidiaries  (including Mergerco) is a  party or by which  any of them or their
assets are bound, the failure of which  to obtain could have a Material  Adverse
Effect.
 
     SECTION   5.9  Proxy   Statement;  Registration  Statement.   None  of  the
information supplied or to  be supplied by Parent  or Mergerco for inclusion  in
the Proxy Statement or the Registration Statement,
 
                                       10
 
<PAGE>
including   any  amendments   thereto,  including   all  information  concerning
subsidiaries of the Parent (but excluding Non-Subsidiaries of the Parent, as  to
which  no representation is given), will be  false or misleading with respect to
any material fact or will omit to state any material fact required to be  stated
therein  or necessary in order  to make the statements  therein, in light of the
circumstances under which they are made, not misleading.
 
                                   ARTICLE VI
                         COVENANTS FOLLOWING THE MERGER
 
     SECTION  6.1   Indemnification.   Parent   agrees  that   all   rights   to
indemnification  now existing  in favor of  the employees,  agents, directors or
officers of the  Company and  its subsidiaries  (collectively, the  'Indemnified
Parties')  as provided in their respective  charters or by-laws, by agreement or
otherwise in effect on the date hereof shall survive the Merger and shall,  with
respect  to  any  action or  omission  occurring  prior to  the  Effective Time,
continue in full force and effect in accordance with their terms for a period of
six (6) years from the Effective Time; provided that, in the event any claim  or
claims  are asserted  or made  within such  six (6)  year period,  all rights to
indemnification in respect of any such claim or claims shall continue until  the
disposition  of any and all such claims.  Without limiting the foregoing, in the
event that any Indemnified Party becomes involved in any capacity in any action,
proceeding or  investigation  in  connection  with  any  matter,  including  the
transactions  contemplated  hereby,  occurring  prior  to,  and  including,  the
Effective Time, the Company will periodically advance to such Indemnified  Party
its  legal and other  expenses incurred in  connection therewith. Parent further
agrees that it shall, jointly and  severally with the Surviving Corporation,  to
the  extent, with respect  to each indemnitor, permitted  by applicable law, (i)
indemnify each member of the Special Committee and their successors and  assigns
from  and  against  any  and  all  issues,  claims,  judgments  and  liabilities
(including  reasonable  fees  and  disbursements  of  attorneys  and  costs   of
investigation),   relating  to   this  Merger  Agreement   or  the  transactions
contemplated hereby and (ii) periodically advance to each member of the  Special
Committee  legal and other expenses  incurred in connection therewith; provided,
however, that Parent's indemnification liabilities (including its obligations to
advance legal and other expenses) shall not  apply either (x) in respect of  any
liability  unless demand  for indemnification  in respect  of such  liability is
first made on the Company and the Company does not promptly pay the same or  (y)
to  amounts paid  in any  settlement effected  without Parent's  written consent
(which consent  shall  not  be  unreasonably withheld).  In  any  proceeding  to
determine  whether Parent's consent was unreasonably withheld Parent, shall have
the burden of proof of demonstrating its consent was reasonably withheld. Parent
shall cause to be maintained  in effect for a period  of six (6) years from  the
Effective  Time the current  policies of the  directors' and officers' liability
insurance maintained by  the Company  (the 'D&O  Insurance Coverage')  (provided
that  Parent  may substitute  therefor policies  of at  least the  same coverage
containing terms and conditions which are no less advantageous) with respect  to
matters  occurring prior to the Effective Time; provided, however, that Parent's
obligation to  maintain such  D&O Insurance  Coverage shall  be subject  to  the
Company being able to maintain or obtain insurance at an annual cost not greater
than  150% of the annual premiums  currently paid (the annual premiums currently
paid being the 'Current Annual Premiums') by the Company with respect to its D&O
Insurance Coverage and if such D&O  Insurance Coverage is not available at  such
cost,  then  Parent  shall cause  to  be  maintained the  highest  level  of D&O
Insurance Coverage that  can be  purchased against payment  and annual  premiums
equal to 150% of the Current Annual Premiums.
 
     SECTION  6.2 Further Action. In case at  any time after the Effective Time,
Parent or  the  Surviving Corporation  or  their successors  or  assigns,  shall
determine  that  any further  conveyance, assignment  or  other document  or any
further action  is reasonably  necessary  or desirable  in connection  with  the
matters  specified in this  Merger Agreement, then the  parties hereto, with the
Surviving Corporation  acting  on behalf  of  the  Company, shall  cause  to  be
executed and delivered, all such deeds, endorsements, assignments and other good
and  sufficient instruments  of conveyance  and transfer,  including appropriate
form endorsements to all title and other insurance policies, as shall be  valid,
operative  and effective to vest in the  Surviving Corporation good title to all
of the property, assets and business  to be conveyed, transferred, assigned  and
delivered  hereunder, and will take  or cause to be  taken such further or other
action  as  Parent  or   the  Surviving  Corporation   may  deem  necessary   or
 
                                       11
 
<PAGE>
desirable  in order to vest in and confirm the title to and possession of all of
the property,  rights, privileges,  powers  and franchises  of the  Company  and
otherwise to carry out the intent and purposes of this Merger Agreement.
 
                                  ARTICLE VII
                                   CONDITIONS
 
SECTION  7.1 Conditions  to Each  Party's Obligation  to Effect  the Merger. The
respective obligations of each  party to effect the  Merger shall be subject  to
the fulfillment at or prior to the Effective Time of the following conditions:
 
          (a)  this Merger Agreement and the Merger shall have been approved and
     adopted at  or prior  to the  Effective Time  by the  Required  Stockholder
     Votes;
 
          (b)  the Registration Statement shall  have become effective under the
     Securities Act and no stop  order suspending such effectiveness shall  have
     been  issued or proceeding  for such purpose shall  have been instituted or
     threatened;
 
          (c) no  order,  statute,  rule,  regulation,  executive  order,  stay,
     decree,   judgment  or   injunction  shall  have   been  enacted,  entered,
     promulgated or  enforced  by  any court  or  governmental  authority  which
     prevents  or materially restricts the  consummation of the Merger; provided
     that Parent, Mergerco and the Company shall use their best efforts to  have
     such order, decree or injunction vacated;
 
          (d)  the United  States District  Court for  the Southern  District of
     Florida (the 'District Court'), in  the action entitled WILLIAM E.  EHRMAN,
     privately  on  behalf  of  nominal  defendant  SOUTHEASTERN  PUBLIC SERVICE
     COMPANY, a  Delaware corporation,  Plaintiff, vs.  VICTOR POSNER,  ET  AL.,
     Defendants and SOUTHEASTERN PUBLIC SERVICE COMPANY, a Delaware corporation,
     Nominal  Defendant, Case  No. 90-2822-CIV-KEHOE (the  'Action'), shall have
     entered  an  order  and  final  judgment  (the  'Judgment')  approving  the
     Stipulation   of  Settlement,  entered  into   on  October  18,  1993  (the
     'Stipulation of Settlement'), and dismissing the Action on the merits  with
     prejudice and without costs to any party;
 
          (e)  the shares  of Parent Class  A Common  Stock to be  issued as the
     Merger Consideration  pursuant  to the  Merger  Agreement shall  have  been
     approved for listing on each stock exchange located in the United States of
     America  upon which  the shares  of Parent  Class A  Common Stock  are then
     listed, subject to official notice of issuance; and
 
          (f) Smith  Barney shall  not have  withdrawn or  in any  material  way
     modified or amended the Fairness Opinion.
 
     SECTION  7.2  Conditions  to  Obligation  of  the  Company  to  Effect  the
Merger. The obligation of the Company to  effect the Merger shall be subject  to
the  fulfillment at or prior  to the Effective Time  of the following additional
conditions:
 
          (a) Parent and Mergerco shall have performed in all material  respects
     their  agreements  contained  in  this  Merger  Agreement  required  to  be
     performed at or prior to the Effective Time;
 
          (b) except as contemplated or permitted by this Merger Agreement,  the
     representations and warranties of the Parent and Mergerco set forth in this
     Merger  Agreement shall be true and correct in all material respects at and
     as of the Effective Time as if made  at and as of such date, unless  stated
     in  this Merger Agreement  to be true on  and as of  another date, in which
     case such representation and warranty shall have been true in all  material
     respects on and as of such date; and
 
          (c)  since the date of the Merger Agreement, there shall not have been
     (a) any material adverse  change, or any development,  not in the  ordinary
     course  of business, which is likely to result in a material adverse change
     in the business, assets, financial  condition or the results of  operations
     of  Parent  and its  subsidiaries,  taken as  a  whole; (b)  any  change in
     accounting methods, principles or practices by Parent materially  affecting
     its  assets,  liabilities  or business,  except  insofar as  may  have been
     required by a change in  generally accepted accounting principles; (c)  any
     damage, destruction
 
                                       12
 
<PAGE>
     or  loss  which,  after taking  into  account any  insurance  proceeds with
     respect thereto, would  have a Material  Adverse Effect on  Parent and  its
     subsidiaries, taken as a whole.
 
     SECTION  7.3 Conditions to Obligations of Parent and Mergerco to Effect the
Merger. The obligations  of Parent and  Mergerco to effect  the Merger shall  be
subject  to the fulfillment at  or prior to the  Effective Time of the following
additional conditions:
 
          (a) subject to the  last sentence of Section  3.1 hereof, the  Company
     shall  have performed in all material  respects its agreements contained in
     this Merger Agreement required to be performed at or prior to the Effective
     Time;
 
          (b) except as contemplated or permitted by this Merger Agreement,  the
     representations  and warranties  of the  Company set  forth in  this Merger
     Agreement shall be true and correct in  all material respects at and as  of
     the  Effective Time as if made at and as of such date unless stated in this
     Merger Agreement to be true on and  as of another date, in which case  such
     representation  and warranty shall have been  true in all material respects
     on and as of such date;
 
          (c) there shall not  have occurred and be  continuing (i) any  general
     suspension  of trading in,  or limitation on prices  for, securities on the
     New York Stock Exchange, Inc. or on any exchange on which the shares of the
     Parent Class A Common Stock are listed for trading, (ii) a declaration of a
     banking moratorium  or  any suspension  of  payments in  respect  of  banks
     generally  in  the  United  States,  whether  or  not  mandatory,  (iii)  a
     commencement of a war, armed hostilities or other international or national
     calamity materially affecting the United  States which commenced after  the
     date  of this Agreement, (iv) any  limitation (whether or not mandatory) by
     any governmental  authority on,  or  any other  event which  is  reasonably
     likely  to  affect  the  extension  of credit  by  banks  or  other lending
     institutions in the United States or (v) any material adverse change in the
     United States  securities  or  financial markets,  which  material  adverse
     change  shall be deemed to have occurred if the closing Standard and Poor's
     500 Stock  Index (the  'S&P 500  Index') on  the business  day  immediately
     preceding the day on which the Meeting is held and the Required Stockholder
     Votes  taken, is at  least 12% less than  the closing S&P  500 Index on the
     business day immediately preceding the date of this Merger Agreement;
 
          (d) there shall not have been any action taken, or any statute,  rule,
     regulation,  legislation,  interpretation,  judgment,  order  or injunction
     enacted,  entered,  enforced,  promulgated,   amended,  issued  or   deemed
     applicable   to  the  Merger  by  any  domestic  legislative  body,  court,
     government or  governmental,  administrative  or  regulatory  authority  or
     agency  (i) restraining or preventing the  carrying out of the transactions
     contemplated hereby, (ii)  prohibiting Parent's ownership  or operation  of
     all  or any material portion of its  or the Company's businesses or assets,
     or compelling Parent  to dispose of  or hold separate  all or any  material
     portion  of Parent's or the  Company's businesses or assets  as a result of
     the transactions  contemplated  by  this  Merger  Agreement,  (iii)  making
     acquisition  of the shares  of Company Common Stock  pursuant to the Merger
     illegal, (iv) prohibiting Parent effectively  from acquiring or holding  or
     exercising  full rights of ownership of the shares of Company Common Stock,
     including, without  limitation, the  right to  vote the  Shares of  Company
     Common Stock acquired by it pursuant to the Merger, on all matters properly
     presented to the stockholders of the Company, (v) prohibiting Parent or any
     of  its  subsidiaries or  affiliates  from effectively  controlling  in any
     material respect the  businesses or  operations of the  Company, Parent  or
     their  respective subsidiaries,  or (vi)  which would  impose any condition
     which would materially adversely affect the business of the Company or  (as
     a  condition  of  consummating the  transactions  contemplated  hereby) the
     business of Parent and its subsidiaries taken as a whole;
 
          (e)  there  shall  not  have  been  any  federal  income  tax  changes
     (including  any  legislation,  regulation,  or  judicial  or administrative
     interpretations)  adopted,  or  proposed  by  the  United  States  Treasury
     Department or by the Chairman or ranking minority member of either the Ways
     and  Means Committee (the 'Ways and  Means Committee') of the United States
     House of  Representatives  (the  'House') or  the  Finance  Committee  (the
     'Finance  Committee')  of  the  United  States  Senate  (the  'Senate'), or
     favorably reported to either the full House or Senate by the Ways and Means
     Committee or the  Finance Committee, on  or subsequent to  the date  hereof
     that would make consummation of the Merger impracticable;
 
                                       13
 
<PAGE>
          (f)  the  Company's Board  of Directors  shall  not have  withdrawn or
     modified its position with respect to the Merger;
 
          (g) except as set forth below, since the date of the Merger Agreement,
     there shall  not  have  been  (a)  any  material  adverse  change,  or  any
     development,  not in  the ordinary course  of business, which  is likely to
     result in  a material  adverse change  in the  business, assets,  financial
     condition or the results of operations of the Company and its subsidiaries,
     taken  as  a whole;  (b) any  change in  accounting methods,  principles or
     practices by the  Company materially affecting  its assets, liabilities  or
     business, except insofar as may have been required by a change in generally
     accepted  accounting principles; (c) any damage, destruction or loss which,
     after taking  into account  any insurance  proceeds with  respect  thereto,
     would  have a Material Adverse Effect  on the Company and its subsidiaries,
     taken as  a whole.  Actions taken  by the  Company in  connection with  its
     decision  to sell  substantially all of  its businesses and  assets as they
     exist on  the date  of the  Merger Agreement,  and the  restatement of  the
     Company's   1993  audited  financial  statements  and  quarterly  financial
     statements to reflect  the discontinuance  of such business,  shall not  be
     deemed  to constitute events which cause  the foregoing condition not to be
     satisfied; and
 
          (h) the Judgment shall have become final and non-appealable.
 
                                  ARTICLE VIII
                                  TERMINATION
 
     SECTION 8.1 Termination. This Agreement may be terminated at any time prior
to the Effective Time, notwithstanding the  approval by the stockholders of  any
or all of Parent, Mergerco or the Company, (a) by mutual consent of the Board of
Directors of Parent, Mergerco and the Company; (b) by either Parent and Mergerco
or  the Company if the Merger shall not  have been consummated on or before June
30, 1994 (or such  later date as may  be agreed to by  Parent, Mergerco and  the
Company  in writing) unless  the failure to  consummate the Merger  on or before
such date shall have resulted from the failure of the party seeking to terminate
the Merger Agreement  to satisfy  any of the  closing conditions  which are  set
forth  in Section 7.2 or 7.3  hereof, as the case may  be; (c) by the Company if
Parent or  Mergerco  fails to  perform  in any  material  respect any  of  their
material  obligations under this Merger Agreement;  or (d) by Parent or Mergerco
if the Company  fails to perform  in any  material respect any  of its  material
obligations  under this  Merger Agreement; provided  that in the  case of either
clause (c) or (d), if such failure is curable, notice of such failure shall have
been given to  the defaulting  party and such  defaulting party  shall not  have
cured  such  failure within  30  days of  notice  thereof. This  Agreement shall
automatically, and without any  action by the parties  hereto, be terminated  at
any  time  prior to  the  Effective Time,  notwithstanding  the approval  by the
stockholders of  any or  all of  Parent, Mergerco  or the  Company, if  (i)  the
District  Court  rejects  any  of  the  material  terms  of  the  Stipulation of
Settlement or (ii) any appeals court  having jurisdiction over the matter  shall
set  aside, overturn  or materially  modify the  Judgment of  the District Court
approving the  Stipulation of  Settlement, or  otherwise take  any action  which
causes  the Stipulation of  Settlement to fail to  become effective according to
its terms.
 
     SECTION 8.2 Effect of Termination. In the event of the termination of  this
Agreement by either Parent or Mergerco or by the Company, as provided in Section
8.1  hereof, this Agreement shall thereafter become  void and have no effect and
no party  hereto shall  have any  liability to  any other  party hereto  or  its
stockholders or directors or officers in respect thereof (except as set forth in
Sections 6.1 and 9.3 hereof).
 
                                   ARTICLE IX
                               GENERAL AGREEMENTS
 
     SECTION 9.1 Non-Survival of Representations, Warranties and Agreements. All
representations,  warranties and agreements  in this Merger  Agreement or in any
instrument delivered pursuant  to this  Merger Agreement shall  not survive  the
Effective Time, except for the agreements set forth in Article VI hereof.
 
                                       14
 
<PAGE>
     SECTION  9.2 Closing.  The closing  of the Merger  shall take  place at the
offices of  Paul,  Weiss,  Rifkind,  Wharton &  Garrison,  1285  Avenue  of  the
Americas,  New York, New York 10019-6064, (or at such other place as the parties
shall agree) as  promptly as  practicable after  the meetings  of the  Company's
stockholders referred to in Section 1.5 hereof.
 
     SECTION  9.3 Expenses. Whether or not  the Merger is consummated, all costs
and expenses incurred  in connection  with this Agreement  and the  transactions
contemplated  hereby  shall  be  paid  by the  party  incurring  such  costs and
expenses.
 
     SECTION 9.4 Notice. All notices and other communications hereunder shall be
in writing  and  shall  be deemed  to  have  been duly  given  if  delivered  by
messenger,  transmitted by telecopier, telex or telegram or mailed by registered
or certified mail, postage prepaid, as follows:
 
     If to Parent or Mergerco, to:
 
          Triarc Companies, Inc.
        777 S. Flagler Drive
        West Palm Beach, Florida 33401
        Attention: Anthony W. Graziano, Jr., Esq.
        Telecopier No.: (407) 653-4268
 
     with a copy to:
 
          Brian L. Schorr, Esq.
        Paul, Weiss, Rifkind, Wharton & Garrison
        1285 Avenue of the Americas
        New York, New York 10019-6064
        Telecopier No.: (212) 757-3990
 
     (b) If to the Company, to:
 
          Southeastern Public Service Company
        777 S. Flagler Drive
        West Palm Beach, Florida 33401
        Attention: Anthony W. Graziano, Jr., Esq.
        Telecopier No.: (407) 653-4268
 
     with copies to:
 
          Special Committee
        c/o David E. Schwab II, Esq.
        Schwab Goldberg Price & Dannay
        1185 Avenue of the Americas
        New York, NY 10036
        Telecopier No.: (212) 719-5276
 
     and
 
          Laurence D. Weltman, Esq.
        Willkie Farr & Gallagher
        153 East 53rd Street
        New York, NY 10022
        Telecopier No.: (212) 752-2991
 
     Except as otherwise specified herein, all notices and other  communications
shall  be to  have been  duly given  on the first  to occur  of (a)  the date of
delivery if delivered personally on a business day during normal business hours,
and if not, on the next occurring business day, (b) five days following  posting
if  transmitted by mail, (c) the date of transmission with confirmed answer-back
if transmitted by telex on a business  day during normal business hours, and  if
not,  on  the  next  occurring business  day,  or  (d) the  date  of  receipt if
transmitted by telecopier or facsimile on a business day during normal  business
hours,  and if not, on the next occurring business day. Any party may change his
or its  address for  purposes  hereof by  notice to  the  other party  given  as
provided in this Section 9.4.
 
                                       15
 
<PAGE>
     SECTION 9.5 Amendments. This Merger Agreement may be amended by the parties
hereto,  by action taken  by their respective  Boards of Directors,  at any time
prior to the  Effective Time;  provided, however,  that after  approval of  this
Agreement by the stockholders of the Company, no amendment or modification shall
(a)  alter or change  the amount or  kind of shares,  securities, cash, property
and/or rights to be received in exchange for  or on conversion of all or any  of
the  shares of any class  or series thereof of the  Company, (b) alter or change
any term of the certificate of incorporation of the Surviving Corporation to  be
effected  by the Merger, (c) alter or change  any of the terms and conditions of
this Agreement if such alteration or  change would adversely affect the  holders
of  any class or series of capital stock of the Company or (d) amend Section 9.6
hereof so that  waiver by  the parties  of the  condition set  forth in  Section
7.1(d)  hereof would  be permitted.  This Merger  Agreement may  not be amended,
modified or supplemented except by written agreement of the parties hereto.
 
     SECTION 9.6 Waiver. At  any time prior to  the Effective Time, the  parties
hereto  by action taken by  their respective Boards of  Directors may (a) extend
the time for  the performance of  any of the  obligations or other  acts of  the
other  parties hereto,  (b) waive  any inaccuracies  in the  representations and
warranties contained herein or  in any document  delivered pursuant hereto,  and
(c)  waive compliance with any of the agreements or conditions contained herein;
provided, however, that the parties may not waive compliance with the  condition
set  forth in Section 7.1(d) hereof. Any agreement on the part of a party hereto
to any  such  extension or  waiver  shall  be valid  only  if set  forth  in  an
instrument  in writing signed  on behalf of  such party. The  Company shall only
take actions with  respect to  the enforcement of  its right  under this  Merger
Agreement,  including, without  limitation, the granting  of any  waivers or the
approval of any amendments, if such actions are authorized by the members of the
Special Committee.
 
     SECTION 9.7 Brokers. The  Company represents and  warrants that except  for
fees  payable to Smith Barney as financial  advisor to the Special Committee, no
broker, finder or investment  banker is entitled to  any brokerage, finder's  or
other  fee or commission  in connection with the  Merger based upon arrangements
made by or on behalf of the  Company. Parent and Mergerco represent and  warrant
that  no  broker, finder  or  investment banker  is  entitled to  any brokerage,
finder's or other  fee or commission  in connection with  the Merger based  upon
arrangements made by or on behalf of Parent and Mergerco.
 
     SECTION  9.8 Publicity. So long as this Agreement is in effect, the parties
hereto shall not, and shall  cause their affiliates not  to, issue or cause  the
publication  of  any press  release or  other announcement  with respect  to the
Merger or this Merger  Agreement without the consent  of the other party,  which
consent  shall not be withheld or delayed  where such release or announcement is
required by applicable law or any  listing agreement with a national  securities
exchange.
 
     SECTION  9.9 Subsidiaries.  When a reference  is made in  this Agreement to
subsidiaries of  Parent  or  the  Company, the  word  'subsidiaries'  means  any
corporation more than 50% of whose outstanding voting securities are directly or
indirectly  owned by Parent or  the Company, as the  case may be; provided that,
for the purpose of this Agreement, neither the Company nor any subsidiary of the
Company shall be deemed a 'subsidiary' of Parent prior to the Effective Time.
 
     SECTION 9.10 Headings. The headings contained in this Merger Agreement  are
for  reference purposes  only and  shall not  affect in  any way  the meaning or
interpretation of this Merger Agreement.
 
     SECTION 9.11 Non-Assignability. This Merger Agreement shall not be assigned
by operation of law  or otherwise, except  that at the  election of Parent,  any
direct  or indirect  wholly-owned subsidiary  of Parent  may be  substituted for
Mergerco as a  Constituent Corporation in  the Merger for  all purposes of  this
Merger Agreement.
 
     SECTION  9.12 Counterparts. This Merger Agreement may be executed in two or
more counterparts each of  which shall be deemed  to constitute an original  and
shall become effective when one or more counterparts have been signed by each of
the parties hereto and delivered to the other parties.
 
                                       16
 
<PAGE>
     SECTION  9.13 Governing Law. This Merger Agreement shall be governed by and
construed in accordance with  the laws of  the State of  New York applicable  to
contracts made and to be performed wholly within such state except to the extent
the provisions of the DGCL apply.
 
     IN  WITNESS WHEREOF, the parties have caused this Agreement to be signed by
their respective duly authorized officers as of the date first above written.
 
                                          SOUTHEASTERN PUBLIC SERVICE COMPANY
 
                                          By:        /s/ JOSEPH A. LEVATO
                                               .................................
                                            Title: Executive Vice President and
                                                   Chief Financial Officer
 
Attest:
 
         /s/ CURTIS S. GIMSON
 .....................................
              Secretary
 
                                          TRIARC COMPANIES, INC.
 
                                          By:    /s/ ANTHONY W. GRAZIANO, JR.
                                               .................................
                                            Title: Executive Vice President and
                                                   General Counsel, and
                                                   Assistant Secretary
 
Attest:
 
         /s/ CURTIS S. GIMSON
 .....................................
              Secretary
 
                                          SEPSCO MERGER CORPORATION
 
                                          By:    /s/ ANTHONY W. GRAZIANO, JR.
                                               .................................
                                            Title: Executive Vice President and
                                                   General Counsel, and
                                                   Assistant Secretary
 
Attest:
 
         /s/ CURTIS S. GIMSON
 .....................................
              Secretary
 
                                       17

<PAGE>
[Smith Barney logo]                                                     ANNEX II
 
November 22, 1993
 
The Board of Directors
Southeastern Public Service Company
777 S. Flagler Drive
West Palm Beach, FL 33401
 
Attention: David E. Schwab II, Esq.
         Sir Ian McGregor
         The Special Committee of
         the Board of Directors
 
Gentlemen:
 
You have requested our opinion as to the fairness from a financial point of view
of  the consideration to  be received by  the public holders  (other than Triarc
Companies,  Inc.  ('Triarc'),  formerly  known  as  DWG  Corporation,  and   its
affiliates)  of common stock, par value $1.00 per share ('Company Common Stock')
of Southeastern Public Service Company  ('SEPSCO' or the 'Company') pursuant  to
the  Agreement and  Plan of Merger,  dated November 22,  1993 (the 'Agreement'),
among SEPSCO,  Triarc, and  Merger  Corporation, a  wholly owned  subsidiary  of
Triarc  ('Mergerco').  The Agreement  provides for  a  merger (the  'Merger') of
Mergerco into the Company  pursuant to which each  outstanding share of  Company
Common  Stock will be converted into 0.8  shares of Triarc Class A Common Stock,
par value $0.10 per share ('Triarc Common Stock') and the Company will become  a
wholly  owned  subsidiary  of Triarc.  As  described  in greater  detail  in the
preliminary Proxy  Statement  of  the  Company and  Prospectus  of  Triarc  (the
'Statement'),  which  the Company  has filed  with  the Securities  and Exchange
Commission in connection with the proposed Merger, it is our understanding  that
the  consummation  of  the  Merger will  satisfy  certain  terms  and conditions
contained in a form  of Stipulation of  Settlement (the 'Settlement  Agreement')
(the  form of which is annexed to the  Statement) to be entered into relating to
the settlement of a purported derivative action brought on behalf of the Company
by William A. Ehrman  (the 'Plaintiff'), a  SEPSCO shareholder, against  Triarc,
certain  of  its affiliates  and certain  individuals, including  certain former
directors of SEPSCO, which action (the 'Ehrman Litigation') is currently pending
before the United States District Court for the Southern District of Florida. It
is our further understanding that Triarc currently owns 71.1% of the outstanding
shares of Company  Common Stock  and 100% of  the outstanding  shares of  SEPSCO
5  1/2% Cumulative Convertible  Preferred Stock, Series B,  par value $50.00 per
share.
 
You have informed us that  the Board of Directors  of SEPSCO has authorized  the
sale  or  discontinuance  of SEPSCO's  businesses  and assets,  has  closed some
transactions for the  sale of  some assets, and  has been  actively involved  in
Negotiations  with a number of potential  purchasers with respect to others. For
the purposes hereof, we  do not express  any opinion as to  the fairness of  any
individual  transaction relating to the sale  or discontinuance of the Company's
businesses or assets. We have not been requested to, and have not, reviewed  any
of  the acquisition  proposals submitted  by prospective  purchasers for  any of
SEPSCO's businesses or assets, nor have we solicited the receipt by the  Company
of any acquisition proposals relating to its businesses or assets.
 
In  arriving  at our  opinion  we have  examined,  among other  things,  (i) the
Statement, (ii)  the Agreement,  (iii)  certain publicly  available  information
relating  to the  business, financial condition  and operations  of SEPSCO, (iv)
certain financial and  other information furnished  to us by  SEPSCO and  Triarc
that  is  not  publicly  available,  including  projected  financial information
prepared by  the managements  of the  Company and  its subsidiaries  and  Triarc
concerning  the business  and operations  of the  Company, (v)  certain publicly
available information concerning the trading of, and the trading market for, the
Company Common Stock, (vi) certain  publicly available information with  respect
to  certain other  companies we  believe to  be comparable  to the  business and
operations of the Company and its
 
                                      B-1
 
<PAGE>
subsidiaries, (vii) certain publicly available information concerning the  terms
of  certain other transactions  that we consider  relevant to our investigation,
and (viii) certain publicly available information concerning other  transactions
involving  the  buyout of  minority  stockholders. We  have  reviewed historical
earnings and cash  flow of SEPSCO's  businesses. We have  also met with  certain
senior  officers  of  SEPSCO and  Triarc  to discuss  the  operations, financial
condition, history and prospects of SEPSCO. For the purposes of our opinion,  we
did  not, however, consider the potential value, if any, to SEPSCO of any of the
alleged claims by plaintiff in the Ehrman Litigation.
 
In connection with  rendering our opinion,  we have also  examined, among  other
things,  (i) certain  publicly available  information relating  to the business,
financial condition and operations of Triarc and its subsidiaries, (ii)  certain
financial  and other information furnished to us  by Triarc that is not publicly
available, including projected financial information prepared by the  management
of  Triarc and its subsidiaries concerning the business and operations of Triarc
and its subsidiaries,  (iii) certain publicly  available information  concerning
the  trading  of, and  the trading  market  for, the  Triarc Common  Stock, (iv)
certain publicly available information with  respect to certain other  companies
we  believe to be  comparable to the  business and operations  of Triarc and its
subsidiaries, and  (v) certain  publicly  available information  concerning  the
terms  of certain other transactions that we  consider relevant to our review of
Triarc and its subsidiaries. We have met with certain senior officers of  Triarc
to  discuss the operations, financial condition, history and prospects of Triarc
and its  subsidiaries.  Finally,  we  have conducted  such  other  analyses  and
examinations  and considered such other  financial, economic and market criteria
as we have deemed necessary in arriving at our opinion.
 
In the course of  our analysis we have  relied without independent  verification
upon  the  accuracy  and completeness  of  the financial  and  other information
publicly available or furnished to or otherwise discussed with us by SEPSCO  and
Triarc, which we have not independently verified. With respect to the non-public
financial  information,  we assumed  that it  was  reasonably prepared  on bases
reflecting  the  best  currently  available  estimates  and  judgments  of   the
managements of SEPSCO and Triarc as to the expected future financial performance
of  SEPSCO  and  Triarc  and their  respective  subsidiaries.  In  rendering our
opinion, we considered the changes in management at certain Triarc subsidiaries,
the changes to the Triarc business plan and the decision by the SEPSCO Board  to
pursue  the  sale or  disposition of  certain  of the  businesses and  assets of
SEPSCO. We have not made, requested  nor received any independent evaluation  or
appraisal  of the assets  or liabilities (contingent or  otherwise) of SEPSCO or
Triarc  or  their  respective  subsidiaries,  nor  have  we  made  any  physical
inspection  of the properties  or assets or  liabilities of SEPSCO  or Triarc or
their respective subsidiaries.
 
We have  not been  authorized to,  and we  have not,  solicited or  investigated
alternative  transactions which might  be available to the  Company. We were not
requested to, and did not, seek other  offers for the shares of SEPSCO not  held
by Triarc. In addition, although we evaluated the financial terms of the Merger,
we were not asked to and did not recommend the specific consideration to be paid
by  Triarc in the Merger,  nor did we participate in  any of the negotiations or
discussions regarding the terms of the Merger or the proposed settlement of  the
Ehrman Litigation.
 
It  should be  noted that  this opinion is  based upon  interest rates, dividend
rates, market conditions  and other  circumstances and  conditions existing  and
known  to us on the date hereof, and this opinion does not represent our opinion
as to the  prospective value of  the Triarc Common  Stock when it  is issued  to
stockholders  of SEPSCO upon consummation of the Merger. The market value of the
Triarc Common Stock  upon consummation of  the Merger could  be higher or  lower
than  its current  market price depending  upon, among other  things, changes in
interest rates, dividend rates,  market conditions, general economic  conditions
and other factors which generally influence the prices of securities.
 
It  is our understanding that this opinion is  solely for the use of the Special
Committee and the Board of Directors in consideration of the proposed Merger and
may not be relied  upon by any  other person, published  or otherwise used,  nor
shall any public references to Smith Barney be made without our written consent,
other than in the Statement to which this opinion is annexed.
 
Smith  Barney  has been  engaged by  the Company  to render  its opinion  to the
Special Committee of the Board  of Directors of the  Company and will receive  a
fee  for our services, which fee is  not contingent upon the consummation of the
Merger. in  the ordinary  course of  our business,  we trade  securities of  the
 
                                      B-2
 
<PAGE>
Company  and Triarc for our  own account and for  the accounts of customers and,
accordingly, may at any time hold a long or short position in such securities.
 
Subject to the foregoing, we are of the  opinion as of the date hereof that  the
consideration  to be received by the holders  of Company Common Stock other than
Triarc and its affiliates  pursuant to the Agreement  is fair, from a  financial
point of view, to such stockholders.
 
Very truly yours,
Smith Barney Shearson Inc.
 
                                      B-3



<PAGE>
                                    PART II
                     INFORMATION NOT REQUIRED IN PROSPECTUS
 
20. INDEMNIFICATION OF DIRECTORS AND OFFICERS
 
     Article  VI of Triarc's Code of Regulations provides for indemnification of
directors, officers and employees of Triarc  to the maximum extent permitted  by
the General Corporation Law of the State of Ohio.
 
     Section 1701.13 of the General Corporation Law of the State of Ohio permits
indemnification  of  any  director,  officer or  employee  with  respect  to any
proceeding against such  person provided  that: (a)  such person  acted in  good
faith,  (b)  such person  reasonably believed  that  the conduct  was in  or not
opposed to  the best  interests of  the corporation  and (c)  in the  case of  a
criminal  proceeding, such  person had no  reasonable cause to  believe that the
conduct was unlawful.  Indemnification may be  made against expenses  (including
attorneys'  fees), judgments, fines and amounts  paid in settlement actually and
reasonably incurred by such person  in connection with the proceeding,  provided
that  if  the  proceeding  is  one  by  or  in  the  right  of  the corporation,
indemnification  may  only  be  made  against  reasonable  expenses   (including
attorneys' fees) and may not be made with respect to any proceeding in which the
director,  officer or employee has been adjudged to be liable to the corporation
except to the extent that  the court in which  the proceeding was brought  shall
determine,   upon  application,  that  such  person  is,  in  view  of  all  the
circumstances, entitled to indemnity for such  expenses as the court shall  deem
proper.  The  termination of  any  proceedings by  judgment,  order, settlement,
conviction or upon  a plea of  nolo contendere  or its equivalent  does not,  of
itself, create a presumption that the director, officer or employee did not meet
the requisite standard of conduct required for indemnification to be permitted.
 
     Section 1701.13 of the General Corporation Law of the State of Ohio further
provides  that indemnification  thereunder may  not be  made by  the corporation
unless authorized after a determination has been made that such  indemnification
is  proper, with that determination to be made  by (a) the Board of Directors by
the majority  vote  of a  quorum  consisting of  directors  not parties  to  the
proceeding,  (b) if such quorum  is not obtainable, or  even if obtainable but a
quorum of disinterested directors so directs, by independent legal counsel in  a
written  opinion,  (c) by  the shareholders  or (d)  by the  court in  which the
proceeding was brought.
 
     Finally, Section 1701.13  of the General  Corporation law of  the State  of
Ohio  provides that indemnification permitted thereunder is not exclusive of any
other rights to which  those seeking indemnification may  be entitled under  the
Articles  of  Incorporation,  Code  of Regulations  or  any  agreement,  vote of
shareholders or disinterested directors or otherwise.
 
     Triarc's Directors'  and  Officers'  Insurance  and  Company  Reimbursement
Policy  is designed to reimburse Triarc for certain payments made by it pursuant
to  the  foregoing  indemnification.  Such  policy  has  a  liability  limit  of
$15,000,000.
 
21. EXHIBITS AND FINANCIAL STATEMENTS SCHEDULES
 
     (a) Exhibits
 
<TABLE>
<CAPTION>
EXHIBIT
  NO.                                                     DESCRIPTION
- -------   ------------------------------------------------------------------------------------------------------------
<S>       <C>
  2.1     --  Agreement and Plan of  Merger dated as of  November 22, 1993 among  Southeastern Public Service Company,
            SEPSCO Merger Corporation and Triarc  Companies, Inc. (included as  Annex I to Proxy  Statement/Prospectus
            that constitutes Part I of the Registration Statement).
  2.2     --  Stock Purchase Agreement dated as  of October 1, 1992 among  DWG Acquisition Group, L.P., Victor Posner,
            Security Management Corp. and Victor Posner Trust No. 20 incorporated herein by reference to Exhibit 10 to
            Amendment No. 4 dated October 5, 1992 to Triarc's Current Report on Form 8-K dated February 17, 1992  (SEC
            file #1-2207).
                                      II-1
 
<PAGE>
 

</TABLE>
<TABLE>
<CAPTION>
EXHIBIT
  NO.                                                     DESCRIPTION
- -------   ------------------------------------------------------------------------------------------------------------
<S>       <C>
  2.3     --  Amendment dated  as of October  1, 1992 between  Triarc Companies,  Inc., then known  as DWG Corporation
            ('Triarc'), and DWG Acquisition Group,  L.P. incorporated herein by reference  to Exhibit 11 to  Amendment
            No.  4 dated October  5, 1992 to  Triarc's Current Report  on Form 8-K  dated February 17,  1992 (SEC file
            #1-2207).
  2.4     -- Exchange Agreement dated as of October 1, 1992 between Triarc and Security Management Corp.  incorporated
            herein  by reference to Exhibit 12 to Amendment No. 4  dated October 5, 1992 to Triarc's Current Report on
            Form 8-K dated February 17, 1992 (SEC file #1-2207).
  3.1     -- Articles of Incorporation of Triarc as currently in effect including all amendments thereto  incorporated
            herein by reference to Exhibit 3.1 to Triarc's Current Report on Form 8-K dated October 27, 1993 (SEC file
            #1-2207).
  3.2     --  Amended Code of Regulations of Triarc incorporated herein  by reference to Exhibit 2 to Triarc's Current
            Report on Form 8-K dated April 23, 1993 (SEC file #1-2207).
  4.1     -- Southeastern  Public Service  Company Indenture  dated  as of  February 1,  1993 incorporated  herein  by
            reference  to Exhibit 4(a) to Southeastern  Public Service Company's Form S-2  dated January 18, 1983 (SEC
            file #2-81393).
  4.2     -- National Propane  Corporation Indenture dated  as of March  1, 1984 incorporated  herein by reference  to
            Exhibit 4(a) to National Propane Corporation's Form S-1 dated March 2, 1984 (SEC file #2-88162).
  4.3     -- Note Purchase Agreement dated as of April 23, 1993 among RC/Arby's Corporation, then known as Royal Crown
            Corporation  ('RC/Arby's'),  Triarc,  RCRB  Funding,  Inc.  and  Merrill  Lynch,  Pierce,  Fenner  & Smith
            Incorporated incorporated herein by reference  to Exhibit 4 to Triarc's  Current Report on Form 8-K  dated
            April 23, 1993 (SEC file #1-2207).
  4.4     -- Indenture dated as of April 23, 1993, among RC/Arby's, Royal Crown Corporation, then known as Royal Crown
            Cola  Co., Inc. ('Royal Crown'), Arby's, Inc. and The Bank of New York incorporated herein by reference to
            Exhibit 5 to Triarc's Current Report on Form 8-K dated April 23, 1993 (SEC file #1-2207).
  4.5     -- Revolving Credit, Term Loan and Security Agreement dated as of April 23, 1993 among Graniteville Company,
            C.H. Patrick & Co., Inc. and The CIT  Group/Commercial Services, Inc. incorporated herein by reference  to
            Exhibit 6 to Triarc's Current Report on Form 8-K dated April 23, 1993 (SEC file #1-2207).
  4.6     --  Form of Indenture  among RC/Arby's, Royal Crown  and Arby's Inc.  and The Bank of  New York, as Trustee,
            relating to the 9 3/4% Senior  Secured Notes Due 2000 incorporated herein  by reference to Exhibit 4.1  to
            RC/Arby's Form S-1 (SEC file #33-62778).
  5.1     -- Opinion of Baker & Hostetler, special counsel to Triarc.
 10.1     --  Employment Agreement dated as of  April 24, 1993 between Donald  L. Pierce and Arby's, Inc. incorporated
            herein by reference to Exhibit  7 to Triarc's Current  Report on Form 8-K dated  April 23, 1993 (SEC  file
            #1-2207).
 10.2     -- Employment Agreement dated as of April 24, 1993 among John C. Carson, Royal Crown and Triarc incorporated
            herein  by reference to Exhibit  8 to Triarc's Current Report  on Form 8-K dated  April 23, 1993 (SEC file
            #1-2207).
 10.3     -- Employment  Agreement  dated as  of  April 24,  1993  between Ronald  D.  Paliughi and  National  Propane
            Corporation  incorporated herein by  reference to Exhibit 9  to Triarc's Current Report  on Form 8-K dated
            April 23, 1993 (SEC file #1-2207).
 10.4     -- Employment Agreement dated  as of April 24,  1993 between H. Douglas  Kingsmore and Graniteville  Company
            incorporated herein by reference to Exhibit 10 to Triarc's Current Report on Form 8-K dated April 23, 1993
            (SEC file #1-2207).
 10.5     --  Employment Agreement  effective as  of November 1,  1993 between  Leon Kalvaria  and Triarc incorporated
            herein by reference to Exhibit 10.01 to Triarc's Quarterly Report on Form 10-Q dated October 31, 1993 (SEC
            File #1-2207).
 10.6     -- Memorandum of Understanding dated September 13, 1993 between Triarc and William Ehrman, individually  and
            derivatively  on behalf of Southeastern Public Service Company incorporated herein by reference to Exhibit
            10.1 to Triarc's Current Report on Form 8-K dated September 13, 1993 (SEC File #1-2207).
 10.7     -- Stipulation of Settlement of the  Ehrman Litigation dated as of  October 18, 1993 incorporated herein  by
            reference to Exhibit 1 to Triarc's Current Report on Form 8-K dated October 15, 1993 (SEC File #1-2207).
 10.8     --  Triarc's Amended and Restated 1993 Equity Participation Plan incorporated herein by reference to Exhibit
            10.5 to Triarc's Annual Report on Form 10-K for the Fiscal year ended April 30, 1993 (SEC file #1-2207).
                                      II-2
 
<PAGE>
 

</TABLE>
<TABLE>
<CAPTION>
EXHIBIT
  NO.                                                     DESCRIPTION
- -------   ------------------------------------------------------------------------------------------------------------
<S>       <C>
 10.9     -- Form  of  Non-Incentive  Stock  Option  Agreement  under Triarc  's  Amended  and  Restated  1993  Equity
            Participation  Plan incorporated herein by reference to Exhibit  12 to Triarc's Current Report on Form 8-K
            dated April 23, 1993 (SEC file #1-2207).
 10.10    -- Form of Restricted  Stock Agreement under  Triarc's Amended and Restated  1993 Equity Participation  Plan
            incorporated herein by reference to Exhibit 13 to Triarc's Current Report on Form 8-K dated April 23, 1993
            (SEC file #1-2207).
 10.11    --  Concentrate Sales  Agreement dated  April 4,  1991 between  RC/Arby's and  Cott Corporation incorporated
            herein by reference to Exhibit 10.7 to RC/Arby's Form S-1 (SEC file #33-62778).
 10.12    -- Concentrate Sales Agreement dated  as of January 28, 1994  between RC/Arby's and Cott Corporation  (filed
            herewith with certain confidential information deleted therefrom pending application made pursuant to Rule
            406 under the Securities Act).
 10.13    --  Supply Agreement dated December 8, 1992 between RC/Arby's and the NutraSweet Company incorporated herein
            by reference to Exhibit 10.9 to RC/Arby's Form S-1 (SEC file #33-62778).
 10.14    -- Consulting Agreement dated as of April 23,  1993 between Triarc and Steven Posner incorporated herein  by
            reference  to Exhibit 10.8 to Triarc's Annual Report on Form 10-K for the Fiscal year ended April 30, 1993
            (SEC file #1-2207).
 10.15    -- Lease Agreement  dated as of  April 1, 1993  between Victor Posner  Trust No. 6  and Triarc  incorporated
            herein by reference to Exhibit 10.9 to Triarc's Annual Report on Form 10-K for the Fiscal year ended April
            30, 1993 (SEC file #1-2207).
 10.16    --  Form of Former Management Services Agreement  between Triarc and certain other corporations incorporated
            herein by reference to  Exhibit 10.10 to  Triarc's Annual Report on  Form 10-K for  the Fiscal year  ended
            April 30, 1993 (SEC file #1-2207).
 10.17    --  Form of New Management Services Agreement  dated as of April 23, 1993  between Triarc and certain of its
            subsidiaries incorporated herein by reference to Exhibit 10.11 to Triarc's Annual Report on Form 10-K  for
            the Fiscal year ended April 30, 1993 (SEC file #1-2207).
 10.18    --  Purchase  Agreement  dated  as of  October  7,  1993  between Southeastern  Public  Service  Company and
            Acquisition Holding Company, Inc.  incorporated herein by  reference to Exhibit    to Southeastern  Public
            Service Company's Current Report on Form 8-K dated October 7, 1993 (SEC file #1-4351).
 10.19    --  Purchase Agreement dated as  of October 7, 1993  between Tree Preservation Co.,  Inc. and Cement Holding
            Company, Inc. incorporated  herein by  reference to  Exhibit    to Southeastern  Public Service  Company's
            Current Report on Form 8-K dated October 7, 1993 (SEC file # 1-4351).
 10.20    --  Purchase Agreement dated as of  September 1, 1993 among Southeastern  Public Service Company, certain of
            its subsidiaries  and  Asplundh  Tree  Expert Co.  incorporated  herein  by  reference to  Exhibit      to
            Southeastern  Public  Service Company's  Current Report  on Form  8-K  dated September  1, 1993  (SEC file
            #1-4351).
 11.1     -- Loss Per Share Computation and Pro Forma Loss Per Share Computation (included on pages F-106 and F-107 of
            Part I of this Registration Statement).
 23.1     -- Consent of Arthur Andersen & Co.
 23.2     -- Consent of Smith Barney Shearson Inc.
 23.3     -- Consent of Baker & Hostetler (included in Exhibit 5.1).
 25.1     -- Powers of attorney (included in Part II of the Registration Statement).
</TABLE>
 
     (b) Financial Statement Schedules
 
<TABLE>
        <S>              <C>
        Schedule II.     Amounts Receivable from Related Parties -- Three years ended April 30, 1993
        Schedule III.    Triarc Companies, Inc. (Parent Company Only) Financial Statements -- April 30, 1993
        Schedule V.      Properties -- Three years ended April 30, 1993
        Schedule VI.     Accumulated Depreciation of Properties -- Three years ended April 30, 1993
        Schedule VIII.   Valuation and Qualifying Accounts -- Three years ended April 30, 1993
        Schedule IX.     Short-Term Borrowings -- Three years ended April 30, 1993
        Schedule X.      Supplementary Statement of Operations Information -- Three years ended April 30, 1993
        Schedule XIV.    Supplemental Information Concerning Property -- Casualty Insurance Operations -- Three
                           years ended April 30, 1993
</TABLE>
 
                                      II-3
 
<PAGE>
     (c) Reports, Opinions or Appraisals
 
<TABLE>
<S>     <C>
        -- Opinion  of  Smith  Barney  Shearson Inc.  dated  November  22,  1993 (included  as  Annex  II  to  Proxy
          Statement/Prospectus that constitutes Part I of this Registration Statement).
</TABLE>
 
22. UNDERTAKINGS
 
     The   undersigned  registrant  hereby  undertakes  that,  for  purposes  of
determining any liability under the Securities  Act of 1933, each filing of  the
registrant's  annual report pursuant to Section 13(a) or 15(d) of the Securities
Exchange Act of 1934 (and, where applicable, each filing of an employee  benefit
plan's annual report pursuant to Section 15(d) of the Securities Exchange Act of
1934)  that is incorporated by reference  in the registration statement 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.
 
     The undersigned registrant hereby undertakes as follows: that prior to  any
public  reoffering  of  the securities  registered  hereunder through  use  of a
prospectus which is  a part  of this registration  statement, by  any person  or
party  who is deemed to be an underwriter within the meaning of Rule 145(c), the
issuer undertakes that such reoffering  prospectus will contain the  information
called  for by the  applicable registration form with  respect to reofferings by
persons who may be  deemed underwriters, in addition  to the information  called
for by the other Items of the applicable form.
 
     The  registrant undertakes that every prospectus (i) that is filed pursuant
to the  immediately preceding  paragraph,  or (ii)  that  purports to  meet  the
requirements  of Section 10(a)(3) of  the Act and is  used in connection with an
offering of  securities subject  to Rule  415, will  be filed  as a  part of  an
amendment  to  the  registration  statement  and will  not  be  used  until such
amendment is  effective, and  that, for  purposes 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.
 
     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  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.
 
     The  undersigned registrant  hereby undertakes  to respond  to requests for
information that is incorporated  by reference into  the prospectus pursuant  to
Items  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.
 
     The undersigned  registrant  hereby undertakes  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.
 
                                      II-4

<PAGE>
                                   SIGNATURES
 
     Pursuant  to the requirements of the Securities Act of 1933, the registrant
has duly caused this Registration  Statement to be signed  on its behalf by  the
undersigned,  thereunto  duly  authorized,  in  the  City  of New York, State of
New York, on March 10, 1994.
 
                                          TRIARC COMPANIES, INC.
 
                                          By            NELSON PELTZ
                                             ...................................
                                                        NELSON PELTZ
                                            CHAIRMAN AND CHIEF EXECUTIVE OFFICER
 
                               POWER OF ATTORNEY
 
     The officers  and  directors of  Triarc  Companies, Inc.  whose  signatures
appear  below, hereby constitute and appoint Nelson  Peltz and Peter W. May, and
each of them (with full power to each of them to act alone), the true and lawful
attorney-in-fact to  sign  and  execute,  on  behalf  of  the  undersigned,  any
amendment  or  amendments  to  this  Registration  Statement  and  each  of  the
undersigned does hereby ratify and confirm  all that said attorneys shall do  or
cause to be done by virtue thereof.
 
     Pursuant   to  the  requirements  of  the  Securities  Act  of  1933,  this
Registration Statement has  been signed below  by the following  persons in  the
capacities and on the dates indicated.
 
<TABLE>
<CAPTION>
                SIGNATURE                                     CAPACITY                            DATE
- ------------------------------------------  --------------------------------------------   -------------------
<S>                                         <C>                                            <C>
               NELSON PELTZ                 Chairman and Chief Executive Officer,            March 10, 1994
 .........................................    Director and Principal Executive Officer
              (NELSON PELTZ)
               PETER W. MAY                 President and Chief Operating Officer, and       March 10, 1994
 .........................................    Director
              (PETER W. MAY)
             JOSEPH A. LEVATO               Executive Vice President, Chief Financial        March 10, 1994
 .........................................    Officer and Principal Financial Officer
            (JOSEPH A. LEVATO)
             FRED H. SCHAEFER               Vice President, Chief Accounting Officer and     March 10, 1994
 .........................................    Principal Accounting Officer
            (FRED H. SCHAEFER)
              LEON KALVARIA                 Vice Chairman and Director                       March 10, 1994
 .........................................
             (LEON KALVARIA)
           IRVING MITCHELL FELT             Director                                         March 10, 1994
 .........................................
          (IRVING MITCHELL FELT)
             HAROLD E. KELLEY               Director                                         March 10, 1994
 .........................................
            (HAROLD E. KELLEY)
            RICHARD M. KERGER               Director                                         March 10, 1994
 .........................................
           (RICHARD M. KERGER)
</TABLE>
 
                                      II-5
 
<PAGE>
 
<TABLE>
<CAPTION>
                SIGNATURE                                     CAPACITY                            DATE
- ------------------------------------------  --------------------------------------------   -------------------
<S>                                         <C>                                            <C>
           HAROLD D. KINGSMORE              Director                                         March 10, 1994
 .........................................
          (HAROLD D. KINGSMORE)
            DANIEL R. MCCARTHY              Director                                         March 10, 1994
 .........................................
           (DANIEL R. MCCARTHY)
             WILLIAM L. PALLOT              Director                                         March 10, 1994
 .........................................
           (WILLIAM L. PALLOT)
          THOMAS A. PRENDERGAST             Director                                         March 10, 1994
 .........................................
         (THOMAS A. PRENDERGAST)
               MARTIN ROSEN                 Director                                         March 10, 1994
 .........................................
              (MARTIN ROSEN)
             GERALD TSAI, JR.               Director                                         March 10, 1994
 .........................................
            (GERALD TSAI, JR.)
           STEPHEN S. WEISGLASS             Director                                         March 10, 1994
 .........................................
          (STEPHEN S. WEISGLASS)
</TABLE>
 
                                      II-6

<PAGE>
                    TRIARC COMPANIES, INC. AND SUBSIDIARIES
                     INDEX TO FINANCIAL STATEMENT SCHEDULES
 
<TABLE>
<CAPTION>
                                                                                                              PAGE
                                                                                                             ------
<S>     <C>                                                                                                  <C>
        Report of Independent Certified Public Accountants on Schedules...................................     II-8
   II.  Amounts Receivable from Related Parties -- Three years ended April 30, 1993.......................     II-9
  III.  Triarc Companies, Inc. (Parent Company Only) Financial Statements -- April 30, 1993...............    II-10
    V.  Properties -- Three years ended April 30, 1993....................................................    II-13
   VI.  Accumulated Depreciation of Properties -- Three years ended April 30, 1993........................    II-14
 VIII.  Valuation and Qualifying Accounts -- Three years ended April 30, 1993.............................    II-15
   IX.  Short-Term Borrowings -- Three years ended April 30, 1993.........................................    II-16
    X.  Supplementary Statement of Operations Information -- Three years ended April 30, 1993.............    II-17
  XIV.  Supplemental Information Concerning Property -- Casualty Insurance Operations -- Three years ended
          April 30, 1993..................................................................................    II-18
</TABLE>
 
                                      II-7
 
<PAGE>
 
        REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS ON SCHEDULES
To the Board of Directors and Stockholders,
  Triarc Companies, Inc.:
 
     We  have audited in accordance  with generally accepted auditing standards,
the consolidated  financial  statements  of  Triarc  Companies,  Inc.  (an  Ohio
corporation,  formerly  DWG  Corporation)  and  subsidiaries  included elsewhere
herein and have issued our report thereon dated August 12, 1993. Our audits were
made for the purpose of forming an opinion on those statements taken as a whole.
The accompanying schedules  are the responsibility  of the Company's  management
and are presented for the purposes of complying with the Securities and Exchange
Commission's  rules and  are not part  of the basic  financial statements. These
schedules have been subjected to the  auditing procedures applied in the  audits
of  the basic  financial statements  and, in  our opinion,  fairly state  in all
material respects  the  financial data  required  to  be set  forth  therein  in
relation to the basic financial statements taken as a whole.
 
                                          ARTHUR ANDERSEN & CO.
 
Miami, Florida,
  August 12, 1993.
 
                                      II-8
 
<PAGE>
                                                                     SCHEDULE II
 
                    TRIARC COMPANIES, INC. AND SUBSIDIARIES
                    AMOUNTS RECEIVABLE FROM RELATED PARTIES
                        THREE YEARS ENDED APRIL 30, 1993
                                 (IN THOUSANDS)
 
<TABLE>
<CAPTION>
                                                                                                  BALANCE AT END
                                                                         DEDUCTIONS                  OF PERIOD
                                       BALANCE AT                 -------------------------    ---------------------
                                       BEGINNING                   AMOUNTS        AMOUNTS                      NOT
           NAME OF DEBTOR              OF PERIOD     ADDITIONS    COLLECTED     WRITTEN-OFF     CURRENT      CURRENT
- ------------------------------------   ----------    ---------    ----------    -----------    ----------    -------
<S>                                    <C>           <C>          <C>           <C>            <C>           <C>
1991 and 1992 :
     Not applicable
1993:
     Loan receivable from officer:
       Leon Kalvaria................   $   --          $ 320      $   --        $   --         $   --         $ 320
                                       ----------    ---------    ----------    -----------    ----------    -------
                                       ----------    ---------    ----------    -----------    ----------    -------
</TABLE>
 
                                      II-9
 
<PAGE>
                                                                    SCHEDULE III
 
                  TRIARC COMPANIES, INC. (PARENT COMPANY ONLY)
                                 BALANCE SHEETS
                            APRIL 30, 1992 AND 1993
 
<TABLE>
<CAPTION>
                                                                                               1992        1993
                                                                                             --------    --------
                                                                                                (IN THOUSANDS)
<S>                                                                                          <C>         <C>
                                          ASSETS
Current assets:
     Cash and equivalents.................................................................   $    126    $ 29,520
     Due from subsidiaries................................................................     24,793      22,219
     Deferred income taxes................................................................      --          9,600
     Other current assets.................................................................         74       1,230
                                                                                             --------    --------
          Total current assets............................................................     24,993      62,569
                                                                                             --------    --------
Note receivable from subsidiary...........................................................      1,500       1,500
Investments in consolidated subsidiaries, at equity.......................................    257,969     242,762
Properties, net...........................................................................        371         103
Other assets..............................................................................      1,716       5,503
                                                                                             --------    --------
                                                                                             $286,549    $312,437
                                                                                             --------    --------
                                                                                             --------    --------
                           LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
     Current portion of long-term debt, net of discount...................................   $ 19,753    $  --
     Accounts payable.....................................................................     20,299       4,678
     Due to subsidiaries..................................................................     13,123      15,712
     Other current liabilities............................................................      4,679      33,066
                                                                                             --------    --------
          Total current liabilities.......................................................     57,854      53,456
                                                                                             --------    --------
Notes and loans payable to subsidiaries, net of discount..................................    137,195     218,462
Deferred income taxes.....................................................................      4,856       --
Other liabilities.........................................................................        162       4,112
Redeemable preferred stock, $12 stated value; authorized 6,000,000 shares in 1993, issued
  5,982,866 shares; aggregate liquidation preference and redemption amount $71,794,000....      --         71,794
Stockholders' equity (deficit):
     Cumulative convertible preferred stock, $1 par value.................................         31       --
     Class A common stock, $.10 par value; authorized 40,000,000 and 75,000,000 shares,
      issued 27,006,336 and 28,251,805 shares.............................................      2,701       2,825
     Class B common stock, $.10 par value; authorized 12,000,000 shares in 1993, none
      issued..............................................................................      --          --
     Additional paid-in capital...........................................................     37,968      52,372
     Retained earnings (deficit)..........................................................     53,920      (6,067)
     Less 1,117,274 and 7,100,145 Class A common shares in treasury at cost...............     (8,315)    (80,109)
     Other................................................................................        177      (4,408)
                                                                                             --------    --------
          Total stockholders' equity (deficit)............................................     86,482     (35,387)
                                                                                             --------    --------
                                                                                             $286,549    $312,437
                                                                                             --------    --------
                                                                                             --------    --------
</TABLE>
 
                                     II-10
 
<PAGE>
                  TRIARC COMPANIES, INC. (PARENT COMPANY ONLY)
                            STATEMENTS OF OPERATIONS
                        THREE YEARS ENDED APRIL 30, 1993
 
<TABLE>
<CAPTION>
                                                                                   1991        1992        1993
                                                                                 --------    --------    --------
                                                                                          (IN THOUSANDS)
<S>                                                                              <C>         <C>         <C>
Income and (expenses):
     Equity in net (losses) income of continuing operations of subsidiaries...   $   (129)   $ 12,196    $(15,634)
     Interest expense.........................................................    (22,973)    (22,751)    (24,858)
     General and administrative expenses......................................     (2,540)     (2,961)     (4,050)
     Facilities relocation and corporate restructuring........................      --          --         (7,200)
     Provision for doubtful accounts from former affiliates...................     (9,554)     (9,221)     (3,311)
     Shareholder litigation and other (expenses) recovery.....................      2,165      (2,004)     (7,025)
     Settlements with former affiliates.......................................      2,871       --          8,900
     Interest income..........................................................      1,248         813         517
                                                                                 --------    --------    --------
          Loss from continuing operations before income taxes.................    (28,912)    (23,928)    (52,661)
Benefit from income taxes.....................................................     11,411      13,721       8,112
                                                                                 --------    --------    --------
     Loss from continuing operations before equity in extraordinary items and
       cumulative effect of changes in accounting principles..................    (17,501)    (10,207)    (44,549)
Equity in income (losses) of discontinued operations of subsidiaries..........        (55)      2,705      (2,430)
Equity in extraordinary items of subsidiaries.................................        703       --         (6,611)
Cumulative effect of changes in accounting principles from:
     Triarc Companies, Inc....................................................      --          --         (3,488)
     Equity in subsidiaries...................................................      --          --         (2,900)
                                                                                 --------    --------    --------
                                                                                    --          --         (6,388)
                                                                                 --------    --------    --------
     Net loss.................................................................    (16,853)     (7,502)    (59,978)
Preferred stock dividend requirements.........................................        (11)        (11)       (121)
                                                                                 --------    --------    --------
     Net loss applicable to common stockholders...............................   $(16,864)   $ (7,513)   $(60,099)
                                                                                 --------    --------    --------
                                                                                 --------    --------    --------
Loss per share:
     Continuing operations....................................................    $(.68)      $(.39)     $(1.73)
     Discontinued operations..................................................      --         .10        (.09)
     Extraordinary items......................................................     .03          --        (.26)
     Cumulative effect of changes in accounting principles....................      --          --        (.25)
                                                                                  $(.65)      $(.29)     $(2.33)
                                                                                 --------    --------    --------
                                                                                 --------    --------    --------
</TABLE>
 
                                     II-11
 
<PAGE>
                  TRIARC COMPANIES, INC. (PARENT COMPANY ONLY)
                            STATEMENTS OF CASH FLOWS
                        THREE YEARS ENDED APRIL 30, 1993
 
<TABLE>
<CAPTION>
                                                                                   1991        1992        1993
                                                                                 --------    --------    --------
                                                                                          (IN THOUSANDS)
<S>                                                                              <C>         <C>         <C>
Cash flows from operating activities:
     Net loss.................................................................   $(16,853)   $ (7,502)   $(59,978)
     Adjustments to reconcile net loss to net cash and equivalents provided
       (used) by operating activities:
          Equity in net losses (income) of subsidiaries.......................       (519)    (14,901)     27,575
          Dividends from subsidiaries.........................................      4,763       1,080       3,127
          Amortization of deferred debt discount and financing costs..........      1,246       1,248       1,248
          Provision for facilities relocation and corporate restructuring.....      --          --          7,200
          Provision for doubtful accounts from former affiliates..............      9,554       9,221       3,311
          Cumulative effect of change in accounting principle.................      --          --          3,488
          Change in due from/to subsidiaries and other affiliates.............      4,157       3,674     (15,214)
          Change in net deferred income taxes.................................        603      (5,130)     (2,199)
          Decrease (increase) in other current assets.........................     (1,288)      9,197      (1,156)
          Increase (decrease) in accounts payable and other current
            liabilities.......................................................     (1,909)      2,182       5,566
          Increase (decrease) in other liabilities............................        (53)        (62)      3,950
          Other, net..........................................................        790         486       2,913
                                                                                 --------    --------    --------
               Net cash and equivalents provided (used) by operating
                 activities...................................................        491        (507)    (20,169)
                                                                                 --------    --------    --------
Cash flows from investing activities:
     Purchase of minority interests...........................................      --          --        (21,100)
     Redemption of investment in affiliate....................................      --          --          2,100
     Capital expenditures, net................................................        (18)         (4)        (21)
                                                                                 --------    --------    --------
               Net cash and equivalents used by investing activities..........        (18)         (4)    (19,021)
                                                                                 --------    --------    --------
Cash flows from financing activities:
     Issuance of Class A common stock.........................................      --          --          9,650
     Repayment of long-term debt..............................................      --            (52)    (20,907)
     Borrowings from subsidiaries.............................................      --          --        141,600
     Repayment of notes and loans payable to subsidiaries.....................      --          --        (57,115)
     Deferred financing costs.................................................      --          --         (4,620)
     Payment of dividends and redemption of preferred stock...................        (11)        (11)        (24)
                                                                                 --------    --------    --------
               Net cash and equivalents provided (used) by financing
                 activities...................................................        (11)        (63)     68,584
                                                                                 --------    --------    --------
Net increase (decrease) in cash and equivalents...............................        462        (574)     29,394
Cash and equivalents at beginning of year.....................................        238         700         126
                                                                                 --------    --------    --------
Cash and equivalents at end of year...........................................   $    700    $    126    $ 29,520
                                                                                 --------    --------    --------
                                                                                 --------    --------    --------
</TABLE>
 
                                     II-12
 
<PAGE>
                                                                      SCHEDULE V
 
                    TRIARC COMPANIES, INC. AND SUBSIDIARIES
                                   PROPERTIES
                        THREE YEARS ENDED APRIL 30, 1993
                                 (IN THOUSANDS)
 
<TABLE>
<CAPTION>
                                                                                              OTHER
                                                 BALANCE AT                                 CHANGES --       BALANCE
                                                 BEGINNING     ADDITIONS    RETIREMENTS     ADDITIONS         AT END
              CLASSIFICATION(1)                   OF YEAR       AT COST      OR SALES      (DEDUCTIONS)      OF YEAR
- ----------------------------------------------   ----------    ---------    -----------    ------------      --------
<S>                                              <C>           <C>          <C>            <C>               <C>
1991:
     Land.....................................    $ 24,942      $   464      $    (239)      $  --           $ 25,167
     Buildings and improvements...............      85,375       12,221         (1,623)            (260)       95,713
     Machinery and equipment..................     271,276       25,188         (6,134)            (369)      289,961
     Automotive and transportation
       equipment..............................      27,312        3,569         (5,186)             361        26,056
                                                 ----------    ---------    -----------    ------------      --------
                                                  $408,905      $41,442      $ (13,182)      $     (268)     $436,897
                                                 ----------    ---------    -----------    ------------      --------
                                                 ----------    ---------    -----------    ------------      --------
1992:
     Land.....................................    $ 25,167      $   121      $     (81)      $  --           $ 25,207
     Buildings and improvements...............      95,713        7,748         (1,285)          (1,362)      100,814
     Machinery and equipment..................     289,961       20,061         (5,952)          (6,130)      297,940
     Automotive and transportation
       equipment..............................      26,056        3,323         (4,292)             (26)       25,061
                                                 ----------    ---------    -----------    ------------      --------
                                                  $436,897      $31,253      $ (11,610)      $   (7,518)(2)  $449,022
                                                 ----------    ---------    -----------    ------------      --------
                                                 ----------    ---------    -----------    ------------      --------
1993:
     Land.....................................    $ 25,207      $   576      $  (2,979)      $     (901)     $ 21,903
     Buildings and improvements...............     100,814        4,112         (6,812)           1,037        99,151
     Machinery and equipment..................     297,940       19,051        (33,958)           2,623       285,656
     Automotive and transportation
       equipment..............................      25,061        3,468         (4,414)             (82)       24,033
                                                 ----------    ---------    -----------    ------------      --------
                                                  $449,022      $27,207      $ (48,163)      $    2,677(3)   $430,743
                                                 ----------    ---------    -----------    ------------      --------
                                                 ----------    ---------    -----------    ------------      --------
</TABLE>
 
- ------------
 
(1) Amounts are restated for discontinued operations.
 
(2) Includes  $7,474  of assets  held for  sale  reclassified to  'Other current
    assets'.
 
(3) Includes  $10,700  purchase  accounting  effect  of  adopting  Statement  of
    Financial  Accounting Standards No. 109 partially offset by reclassification
    of $8,806 of assets held for sale to 'Other current assets'.
 
                                     II-13
 
<PAGE>
                                                                     SCHEDULE VI
 
                    TRIARC COMPANIES, INC. AND SUBSIDIARIES
                     ACCUMULATED DEPRECIATION OF PROPERTIES
                        THREE YEARS ENDED APRIL 30, 1993
                                 (IN THOUSANDS)
 
<TABLE>
<CAPTION>
                                                                ADDITIONS                        OTHER
                                                 BALANCE AT      CHARGED                       CHANGES --     BALANCE
                                                 BEGINNING       TO COSTS      RETIREMENTS     ADDITIONS       AT END
                DESCRIPTION(1)                    OF YEAR      AND EXPENSES     OR SALES      (DEDUCTIONS)    OF YEAR
- ----------------------------------------------   ----------    ------------    -----------    ------------    --------
<S>                                              <C>           <C>             <C>            <C>             <C>
1991..........................................    $157,448       $ 28,861       $  (9,214)      $    (21)     $177,074
                                                 ----------    ------------    -----------    ------------    --------
                                                 ----------    ------------    -----------    ------------    --------
1992..........................................    $177,074       $ 31,224       $ (10,034)      $ (5,422)(2)  $192,842
                                                 ----------    ------------    -----------    ------------    --------
                                                 ----------    ------------    -----------    ------------    --------
1993..........................................    $192,842       $ 31,196       $ (33,199)      $  2,051(3)   $192,890
                                                 ----------    ------------    -----------    ------------    --------
                                                 ----------    ------------    -----------    ------------    --------
</TABLE>
 
- ------------
 
(1) It is not practical to present  accumulated depreciation by category on  the
    related assets. Amounts are restated for discontinued operations.
 
(2) Includes  accumulated  depreciation  of  $5,483  of  assets  held  for  sale
    reclassified to 'Other current assets'.
 
(3) Includes  $6,819  purchase  accounting  effect  of  adopting  Statement   of
    Financial  Accounting Standards No. 109 partially offset by reclassification
    of $5,040 of assets held for sale to 'Other current assets'.
 
                                     II-14
 
<PAGE>
                                                                   SCHEDULE VIII
 
                    TRIARC COMPANIES, INC. AND SUBSIDIARIES
                       VALUATION AND QUALIFYING ACCOUNTS
                        THREE YEARS ENDED APRIL 30, 1993
                                 (IN THOUSANDS)
 
<TABLE>
<CAPTION>
                                                                      ADDITIONS
                                                              --------------------------
                                                BALANCE AT     CHARGED TO     CHARGED TO      DEDUCTIONS      BALANCE AT
                                                BEGINNING      COSTS AND        OTHER            FROM           END OF
                 DESCRIPTION                     OF YEAR        EXPENSES       ACCOUNTS        RESERVES          YEAR
- ---------------------------------------------   ----------    ------------    ----------      ----------      ----------
<S>                                             <C>           <C>             <C>             <C>             <C>
1991:
     Receivables -- allowance for doubtful
       accounts:
          Trade(1)...........................    $  7,368       $  4,315       $ --            $ (4,725)       $  6,958
          Affiliate..........................      26,915          8,037            412          (9,253)         26,111
                                                ----------    ------------    ----------      ----------      ----------
               Total.........................    $ 34,283       $ 12,352       $    412(2)     $(13,978)(3)    $ 33,069
                                                ----------    ------------    ----------      ----------      ----------
                                                ----------    ------------    ----------      ----------      ----------
     Other assets -- notes receivable from
       affiliates............................    $ 18,041       $  9,922       $ --            $ (4,588)(3)    $ 23,375
                                                ----------    ------------    ----------      ----------      ----------
                                                ----------    ------------    ----------      ----------      ----------
     Insurance loss reserves.................    $ 87,149       $ 31,029       $ --            $(29,825)(4)    $ 88,353
                                                ----------    ------------    ----------      ----------      ----------
                                                ----------    ------------    ----------      ----------      ----------
1992:
     Receivables -- allowance for doubtful
       accounts:
          Trade(1)...........................    $  6,958       $  3,054       $ --            $ (3,122)       $  6,890
          Affiliate..........................      26,111         19,953          1,545         (15,393)         32,216
                                                ----------    ------------    ----------      ----------      ----------
               Total.........................    $ 33,069       $ 23,007       $  1,545(2)     $(18,515)(3)    $ 39,106
                                                ----------    ------------    ----------      ----------      ----------
                                                ----------    ------------    ----------      ----------      ----------
     Other assets -- notes receivable from
       affiliates............................    $ 23,375       $  5,733       $   (433)       $(18,285)(3)    $ 10,390
                                                ----------    ------------    ----------      ----------      ----------
                                                ----------    ------------    ----------      ----------      ----------
     Insurance loss reserves.................    $ 88,353       $ 21,469       $ --            $(25,600)(4)    $ 84,222
                                                ----------    ------------    ----------      ----------      ----------
                                                ----------    ------------    ----------      ----------      ----------
1993:
     Receivables -- allowance for doubtful
       accounts:
          Trade(1)...........................    $  6,890       $  3,783       $ --            $ (3,310)       $  7,363
          Affiliate..........................      32,216          3,321            161         (35,698)         --
                                                ----------    ------------    ----------      ----------      ----------
               Total.........................    $ 39,106       $  7,104       $    161(2)     $(39,008)(3)    $  7,363
                                                ----------    ------------    ----------      ----------      ----------
                                                ----------    ------------    ----------      ----------      ----------
     Other assets -- notes receivable from
       affiliates............................    $ 10,390       $  7,037       $ --            $(17,427)(3)    $ --
                                                ----------    ------------    ----------      ----------      ----------
                                                ----------    ------------    ----------      ----------      ----------
     Insurance loss reserves.................    $ 84,222       $ 23,950       $ --            $(31,409)(4)    $ 76,763
                                                ----------    ------------    ----------      ----------      ----------
                                                ----------    ------------    ----------      ----------      ----------
</TABLE>
 
- ------------
 
(1) Amounts are restated for discontinued operations.
 
(2) Charged to affiliates.
 
(3) Accounts determined to be uncollectible.
 
(4) Payment of claims and/or reclassification to 'Accounts payable'.
 
                                     II-15
 
<PAGE>
                                                                     SCHEDULE IX
 
                    TRIARC COMPANIES, INC. AND SUBSIDIARIES
                             SHORT-TERM BORROWINGS
                        THREE YEARS ENDED APRIL 30, 1993
                             (DOLLARS IN THOUSANDS)
 
<TABLE>
<CAPTION>
                                                                                 MAXIMUM       AVERAGE      WEIGHTED
                                                                    WEIGHTED     AMOUNT        AMOUNT        AVERAGE
                                                          BALANCE   AVERAGE    OUTSTANDING   OUTSTANDING    INTEREST
                     CATEGORY OF AGGREGATE                AT END    INTEREST   DURING THE    DURING THE    RATE DURING
YEAR                 SHORT-TERM BORROWINGS                OF YEAR     RATE        YEAR         YEAR(1)     THE YEAR(1)
- -----  -------------------------------------------------  -------   --------   -----------   -----------   -----------
<S>    <C>                                                <C>       <C>        <C>           <C>           <C>
 1991  Factors and other financial institutions.........  $ 6,078     23.8%      $ 9,016       $ 7,235         24.2%
                                                          -------   --------   -----------   -----------      -----
                                                          -------   --------   -----------   -----------      -----
 1992  Factors and other financial institutions.........  $19,464     16.3%      $29,845       $15,919         18.4%
                                                          -------   --------   -----------   -----------      -----
                                                          -------   --------   -----------   -----------      -----
 1993  Factors and other financial institutions.........  $ --         -- %      $14,549       $ 9,346         24.5%
                                                          -------   --------   -----------   -----------      -----
                                                          -------   --------   -----------   -----------      -----
</TABLE>
 
- ------------
 
(1) The average amount outstanding  during the year was  computed on a daily  or
    month-end  weighted average  basis. The  weighted average  interest rate was
    computed by expressing interest and commissions expense applicable to  these
    borrowings as a percentage of the weighted average outstanding borrowings.
 
                                     II-16
 
<PAGE>
                                                                      SCHEDULE X
 
                    TRIARC COMPANIES, INC. AND SUBSIDIARIES
               SUPPLEMENTARY STATEMENT OF OPERATIONS INFORMATION
                        THREE YEARS ENDED APRIL 30, 1993
                                 (IN THOUSANDS)
 
<TABLE>
<CAPTION>
                                                                                             CHARGED TO
                                                                                         COSTS AND EXPENSES
                                                                                    -----------------------------
                                      ITEM                                           1991       1992       1993
- ---------------------------------------------------------------------------------   -------    -------    -------
<S>                                                                                 <C>        <C>        <C>
Maintenance and repairs..........................................................   $18,520    $17,187    $22,272
                                                                                    -------    -------    -------
                                                                                    -------    -------    -------
Advertising costs................................................................   $66,030    $76,505    $72,891
                                                                                    -------    -------    -------
                                                                                    -------    -------    -------
</TABLE>
 
Note: Other  supplementary items are  individually less than  1% of consolidated
      revenues in each year. Information  presented above has been restated  for
      discontinued operations.
 
                                     II-17
 
<PAGE>
                                                                    SCHEDULE XIV
 
                    TRIARC COMPANIES, INC. AND SUBSIDIARIES
            SUPPLEMENTAL INFORMATION CONCERNING PROPERTY -- CASUALTY
                              INSURANCE OPERATIONS
                        THREE YEARS ENDED APRIL 30, 1993
                                 (IN THOUSANDS)
<TABLE>
<CAPTION>
                                             RESERVES
                                               FOR
                                              UNPAID       DISCOUNT,
                                              CLAIMS       IF ANY,
                               DEFERRED        AND         DEDUCTED
                                POLICY        CLAIM           IN                                       NET
     AFFILIATION WITH          ACQUISITION   ADJUSTMENT    PREVIOUS      UNEARNED       EARNED       INVESTMENT
         REGISTRANT             COSTS        EXPENSES(1)    COLUMN       PREMIUMS      PREMIUMS       INCOME
- --------------------------     --------      --------      --------      --------      --------      --------
<S>                            <C>           <C>           <C>           <C>           <C>           <C>
Consolidated property --
  casualty entities:
    1991..................     $ --          $88,353       $ --          $ --          $ 8,063       $ 1,439
                               --------      --------      --------      --------      --------      --------
                               --------      --------      --------      --------      --------      --------
    1992..................     $ --          $84,222       $ --          $ --          $ 4,400       $  (695)
                               --------      --------      --------      --------      --------      --------
                               --------      --------      --------      --------      --------      --------
    1993..................     $ --          $76,763       $ --          $ --          $ 2,875       $   705
                               --------      --------      --------      --------      --------      --------
                               --------      --------      --------      --------      --------      --------
 
<CAPTION>
 
                            CLAIMS AND CLAIM
                               ADJUSTMENT          AMORTIZATION    PAID
                           EXPENSES INCURRED          OF          CLAIMS
                               RELATED TO          DEFERRED        AND
                           ------------------       POLICY        CLAIM
     AFFILIATION WITH      CURRENT    PRIOR        ACQUISITION   ADJUSTMENT    PREMIUMS
         REGISTRANT          YEAR     YEARS         COSTS        EXPENSES      WRITTEN
- -------------------------- --------  --------      --------      --------      --------
<S>                        <C>       <C>           <C>           <C>           <C>
Consolidated property --
  casualty entities:
    1991.................. $ 14,874  $ 16,155      $ --          $29,133       $ 8,063
                           --------  --------      --------      --------      --------
                           --------  --------      --------      --------      --------
    1992.................. $ 14,830  $  6,639      $ --          $25,872       $ 4,400
                           --------  --------      --------      --------      --------
                           --------  --------      --------      --------      --------
    1993.................. $ 10,484  $ 13,466      $ --          $24,773       $ 2,875
                           --------  --------      --------      --------      --------
                           --------  --------      --------      --------      --------
</TABLE>
 
- ------------
 
(1) Does  not include  claims losses  payable of  $7,663, $7,391  and $14,027 at
    April 30, 1991, 1992 and 1993,  respectively, which have been classified  as
    'Accounts payable'.
 
                                     II-18




<PAGE>
                                                                     EXHIBIT 5.1
 
                       [LETTERHEAD OF BAKER & HOSTETLER]
 
                                          March 10, 1994
 
Triarc Companies, Inc.
777 South Flagler Drive
West Palm Beach, Florida 33401
 
                             Re: Registration Statement on Form S-4
                                 with respect to Class A Common Stock
                                 of Triarc Companies, Inc.
 
Gentlemen:
 
     As  special counsel  for Triarc Companies,  Inc., an  Ohio corporation (the
'Company'), we are  familiar with the  registration statement on  Form S-4  (the
'Registration  Statement')  being  filed  this  date  by  the  Company  with the
Securities and Exchange Commission (the  'Commission') under the Securities  Act
of  1933, with  respect to 2,691,822  shares of  Class A Common  Stock, $.10 par
value per share,  of the Company  (the 'Shares')  to be issued  pursuant to  the
Agreement and Plan of Merger by and among Southeastern Public Service Company, a
Delaware  corporation, SEPSCO Merger Corporation, a Delaware corporation and the
Company dated as of November 22, 1993 (the 'Merger Agreement').
 
     In connection with  the foregoing, we  have examined such  documents as  we
have deemed necessary to render this opinion, including, without limitation, the
Articles of Incorporation, as amended, of the Company and the Merger Agreement.
 
     Based upon such examination, we are of the opinion that:
 
          1.  The Company is  a corporation duly  organized and validly existing
     under the laws of the State of Ohio.
 
          2. The Shares have been duly  authorized and, when issued pursuant  to
     the  Merger Agreement  and in the  manner contemplated  by the Registration
     Statement, will be validly issued, fully paid and nonassessable.
 
     We hereby  consent to  the filing  of this  Opinion as  an exhibit  to  the
Registration  Statement and  to the reference  to us under  the caption 'Certain
Legal Matters, Experts and Regulatory Approvals -- Legal Opinions' in the  joint
proxy statement and prospectus which is a part of the Registration Statement.
 
                                          Very truly yours,
 
                                          BAKER & HOSTETLER
 
                                          BAKER & HOSTETLER



<PAGE>
                                                                   EXHIBIT 10.12
 
                              ROYAL CROWN COLA CO.
                              1000 CORPORATE DRIVE
                            FT. LAUDERDALE, FL 33334
 
                                          January 28, 1994
 
Mr. Fraser Latta
Vice Chairman & Chief Operating Officer
Cott Corporation
6526 Viscount Road
Mississauga, Ontario
 
Mr. Ed Szczepanowski
Vice President
BCB International Limited
Chancery House
High Street
Bridgetown, Barbados
West Indies
 
     RE: RCC/Cott Supply Agreement
 
     Gentlemen:
 
     Reference  is made to  the Concentrate Sales  Agreement between Royal Crown
Cola Co. ('RCC') and Cott Corporation ('Cott') which commenced June 1, 1991 (the
'Supply Agreement'). This letter  outlines the terms  and conditions upon  which
(i)  RCC will assign its rights under  the Supply Agreement to BCB International
Limited ('BCB'), a wholly owned subsidiary of Cott, and (ii) RCC will enter into
a new concentrate supply agreement (the  'New Supply Agreement') with BCB.  Cott
and  all of its  present and future subsidiaries  and affiliates are hereinafter
collectively referred to as the 'Cott Group.'
 
     1. Assignment of Existing RCC Rights. RCC  will assign to BCB all of  RCC's
rights  and obligations under the Supply Agreement, in exchange for BCB agreeing
to enter into this New Supply Agreement and for the payment to RCC of
$[deleted, confidential treatment requested pursuant to Rule 406] upon execution
of the New Supply Agreement.  This assignment is to be effective
as of the effective date of the New Supply Agreement and Cott hereby consents to
this assignment.
 
     2. Products and Scope. RCC will manufacture  and sell to BCB, and BCB  will
purchase,  from RCC,  all of  the Cott  Group's worldwide  requirements for cola
concentrates, or cola emulsions  used in the  production of concentrates,  which
concentrates  and emulsions are used in the production of private label and Cott
Group proprietary label carbonated soft drinks ('CSDs'), which CSDs will be sold
to consumers  in  bottles,  cans  or other  containers  (collectively  'PL  Cola
Concentrates') and will be produced, bottled or sold by or on behalf of the Cott
Group.  Wherever  possible,  BCB  will use  commercially  reasonable  efforts to
purchase  all  of   the  Cott  Group's   worldwide  requirements  for   non-cola
concentrates,  or  non-cola emulsions  used in  the production  of concentrates,
which concentrates and emulsions are used in the production of private label and
Cott Group  proprietary label  CSDs, which  CSDs will  be sold  to consumers  in
bottles,  cans or other containers (collectively 'PL Non-Cola Concentrates' and,
together with PL  Cola Concentrates,  'PL Concentrates') and  will be  produced,
bottled  or sold  by or  on behalf  of the  Cott Group.  BCB agrees  that during
calendar 1995  and  each year  thereafter,  at least  75%  of the  Cott  Group's
aggregate worldwide requirements for PL Concentrates will be purchased from RCC.
On  or  prior to  March  31, 1996  and on  or  prior to  March  31 of  each year
thereafter, the Cott Group will deliver a statement based on internal case sales
data of the  Cott Group,  certified as having  been derived  from such  internal
sales data by the independent auditors of the Cott Group, as to whether such 75%
requirement  was  met during  the immediately  preceding year.  RCC may,  at its
request and at its costs, conduct an audit of such case sales data. If the  Cott
Group  fails to satisfy the  foregoing 75% requirement in  any year, RCC will be
permitted to sell PL Concentrates to other
 
<PAGE>
customers, but BCB will continue to be obligated to buy all of the Cott  Group's
requirements   for  PL  Cola  Concentrates  exclusively  from  RCC  and  to  use
commercially reasonable efforts to purchase, wherever possible, all of the  Cott
Group's  requirements for PL Non-Cola Concentrates exclusively from RCC. Subject
to paragraph 6 hereof, in  the event that the Cott  Group purchases any PL  Cola
Concentrates  from anyone other than  RCC and the Cott  Group fails to cure such
breach within 15  days after notice  from RCC, RCC,  in addition to  all of  its
other  rights and  remedies under the  New Supply Agreement  and applicable law,
shall have the right to terminate the New Supply Agreement upon thirty (30) days
written notice and to pursue all of its rights and remedies under applicable law
against the Cott Group for breach of contract.
 
     3. Use  of  Name.  The  Cott  Group may  advise  its  customers  and  other
interested  parties that its PL Concentrates are  made by RCC. However, the Cott
Group may not state or imply that any particular formula is RC Cola,  Diet-Rite,
or  any other  branded product of  RCC. The Cott  Group shall not,  and the Cott
Group shall cause its  customers not to,  use any of  RCC's trademarks or  RCC's
name  in  any  way in  connection  with the  production,  labeling, advertising,
display or marketing of the private label and proprietary label CSDs produced or
sold by or on behalf of the Cott Group.
 
     4. Ownership  of  Formulae.  RCC  will be  the  developer,  formulator  and
supplier of all PL Concentrates for CSDs which will be produced, bottled or sold
by  or on behalf of the Cott Group and which are subject to the terms of the New
Supply Agreement. All rights and title to all formulae developed after the  date
of the New Supply Agreement, whether developed by RCC, the Cott Group or jointly
by RCC and the Cott Group, shall belong exclusively to RCC. Formulae designed by
the  Cott Group prior  to the effective  date of the  New Supply Agreement shall
continue to belong  to the Cott  Group. Formulae  designed by RCC  prior to  the
effective  date of  the New  Supply Agreement shall  continue to  belong to RCC.
Formulae designed by RCC and Cott jointly prior to the effective date of the New
Supply Agreement shall  continue to be  jointly owned. Exhibits  B and C  hereto
identify  the '800' and '900' Series products,  the formulae for which are owned
by the Cott Group, and the '200,'  '300,' '400,' and '500' Series products,  the
formulae for which are owned by RCC. During the term of the New Supply Agreement
and  any renewals thereof RCC agrees not to utilize any of the formulae supplied
to BCB  for  any  other  purpose  without  the  written  consent  of  BCB.  Upon
termination  of the New  Supply Agreement because  one party has  elected not to
renew under Paragraph 10 hereof,  formulae developed by the non-electing  party,
formulae  developed  by the  electing party  which are  in use  at the  time and
formulae developed  by both  parties jointly  shall belong  to the  non-electing
party.  Upon termination of the New Supply Agreement  as a result of a breach or
failure to perform by one party, formulae developed by the non-breaching  party,
formulae  developed by  the breaching  party which  are in  use at  the time and
formulae developed by  both parties  jointly shall belong  to the  non-breaching
party.
 
     5.  Performance Minimums. Except as  provided in the immediately succeeding
sentence, RCC will  agree not to  sell PL  Concentrates to anyone  in the  world
other  than BCB. In the event that BCB fails in any calendar year to purchase PL
Concentrates  from  RCC  which  equal  or  exceed  100  million  12  ounce  case
equivalents  ('Cases')  RCC may  by written  notice to  BCB by  April 30  of the
following  year  elect  to  sell   PL  Cola  Concentrates  and/or  PL   Non-Cola
Concentrates  to other customers. If the volume purchased by BCB from RCC during
any calendar  year declines  by 20%  or more  in comparison  to the  immediately
preceding  year for two consecutive  years, RCC may by  written notice to BCB by
April 30 of the year immediately following  the second year in which BCB  failed
to  purchase the  minimum volumes required,  elect to sell  PL Cola Concentrates
and/or PL Non-Cola  Concentrates to other  customers. If RCC  elects to sell  PL
Cola  Concentrates to other customers, BCB may,  by written notice to RCC within
90 days after receipt of RCC's election, elect to purchase PL Cola  Concentrates
from  suppliers other than RCC, in which case RCC shall continue to be obligated
to supply PL Cola Concentrates to BCB under the terms and conditions of the  New
Supply  Agreement.  If RCC  elects  to sell  PL  Non-Cola Concentrates  to other
customers, BCB may, by  written notice to  RCC within 90  days after receipt  of
RCC's  election, elect to purchase PL Non-Cola Concentrates from suppliers other
than RCC, in which case RCC shall continue to be obligated to supply PL Non-Cola
Concentrates to BCB under the terms and conditions of the New Supply Agreement.
 
                                       2
 
<PAGE>
6. ACQUISITIONS.
 
     6.1 In the event that the  Cott Group acquires a business, whether  through
an  acquisition  of stock  or assets  or  some other  form of  transaction, that
purchases concentrates from a source other  than RCC as a result of  contractual
obligations   and/or  commercial  relationships  not  evidenced  by  contractual
obligations, then  notwithstanding  the  provisions  of  paragraph  2,  (i)  the
acquired  business shall be permitted to  continue to purchase concentrates from
the same non-RCC sources to the extent that it is contractually obligated to  do
so  or for a period of twelve (12)  months after the date of acquisition of such
business by the Cott Group and (ii) in the case of a commercial relationship not
evidenced by a contractual obligation, the acquired business shall be  permitted
to continue to purchase concentrates a from the same non-RCC source for a period
not  exceeding twelve (12) months after the date of acquisition of such business
by the Cott Group. Concentrates purchased by the acquired business from  non-RCC
sources  pursuant  to  the  preceding  sentence shall  not  be  included  in the
calculations of the  75% test  under Paragraph  2 for  a period  of twelve  (12)
months after the date of acquisition of such business by the Cott Group.
 
     6.2  Anything in paragraph 6.1 notwithstanding, (a), wherever possible, the
Cott Group  shall use  commercially  reasonable efforts  to cause  the  acquired
business  to cease purchasing cola and  non-cola concentrates from sources other
than RCC as soon as possible, (b)  the acquired business shall not be  permitted
to  sell cola concentrates manufactured  by sources other than  RCC or CSDs made
from cola concentrates manufactured by sources  other than RCC to any  customers
other  than the customers it  served at the time of  its acquisition by the Cott
Group, (c) the Cott Group shall use commercially reasonable efforts to cause the
acquired business to cease selling non-cola concentrates manufactured by sources
other than RCC or CSDs made  from non-cola concentrates manufactured by  sources
other  than RCC to any customers other than  the customers it served at the time
of its acquisition by the Cott Group and  (d) the Cott Group shall not renew  or
extend  or permit the renewal  or extension of any  contractual obligation of an
acquired business to purchase cola concentrates from a source other than RCC.
 
     6.3 RCC will work with BCB to supply to the acquired business  concentrates
or emulsions of a quality and taste similar to those which the acquired business
purchased  from sources other than RCC (hereinafter 'Replacement Concentrates').
The  prices  for  Replacement  Concentrates  will  be  equal  to  the  cost   of
ingredients, packaging and freight of $[deleted, confidential treatment 
requested pursuant to Rule 406] per Case plus $[deleted, confidential treatment 
requested pursuant to Rule 406] per Case. On the third anniversary of the 
effective date of the New Supply Agreement and on every third anniversary 
thereafter, the $[deleted, confidential treatment requested pursuant  to 
Rule 406] per  Case  rate  shall be  adjusted proportionately  in accordance 
with  the adjustments to the prices set forth in Exhibit A. Thus, if the 
prices in Exhibit A are increased 10%, then the $[deleted, confidential
treatment requested pursuant to Rule 406] per Case rate  for Replacement 
Concentrates shall  increase to  $[deleted, confidential treatment requested 
pursuant  to Rule 406].  Replacement Concentrates  shall be omitted  
from the calculations  of  the 75%  test under Paragraph 2.
 
     6.4 Except as  provided by the  terms of  the New Supply  Agreement, in  no
event  will the Cott  Group engage in  the business of  manufacturing or selling
concentrates or branded CSDs without  RCC's prior written consent. For  purposes
of  this paragraph, branded CSDs refers  to CSDs which are marketed, distributed
and priced in substantially the same manner as the products produced by the  two
major  cola companies.  In the  event that  the Cott  Group wishes  to acquire a
company or business that is engaged in the business of manufacturing or  selling
concentrates  or  branded  CSDs  in competition  with  RCC  (a  'Cott Restricted
Business'), then the Cott Group  shall discontinue the Cott Restricted  Business
or  sell the Cott Restricted  Business to a third  party not affiliated with the
Cott Group within 12  months after the Cott  Group acquires the Cott  Restricted
Business.  RCC  shall  have  a  right of  first  refusal  to  purchase  the Cott
Restricted Business.
 
     6.5 In the  event that RCC  acquires a  company or business  that sells  PL
Concentrates  to customers other  than the Cott  Group, then notwithstanding the
provisions of  paragraph  5, (i)  the  acquired  entity shall  be  permitted  to
continue  to sell PL Concentrates to customers  other than the Cott Group to the
extent that it  is contractually  obligated to  do so and  (ii) in  the case  of
commercial relationships not evidenced by a contractual obligation, the acquired
entity  shall be permitted to  sell PL Concentrates to  customers other than the
Cott Group for a period  not exceeding twelve (12) months  from the date of  the
acquisition  of such entity by RCC.  Notwithstanding the foregoing, (a) wherever
possible RCC  will use  commercially reasonable  efforts to  cause the  acquired
entity to cease selling PL Concentrates to
 
                                       3
 
<PAGE>
customers  other than the Cott Group as soon as possible (b) the acquired entity
shall not be permitted to sell PL  Concentrates to any customers other than  the
customers  it served  at the time  of its acquisition  by RCC (c)  RCC shall not
extend or permit the renewal of any contractual obligation pursuant to which the
acquired entity sells PL  Concentrates to customers other  than the Cott  Group,
and (d) RCC will not undertake any improvement or changes to the PL Concentrates
being  manufactured by the acquired entity for  sale to customers other than the
Cott Group.  For greater  certainty, RCC  will not  supply its  concentrates  or
emulsions to the acquired entity except for sale to the Cott Group.
 
     6.6  The Cott  Group will,  wherever possible,  use commercially reasonable
efforts to purchase PL Concentrates from the acquired entity in a quantity  such
that  the acquired entity's sales  do not decline as  a result of curtailing its
sales of PL Concentrates to customers other than the Cott Group. This  paragraph
will  not obligate the Cott Group  to increase the minimum purchase requirements
contained in paragraph 5 hereof.
 
     6.7 In no event will RCC engage in the business of marketing private  label
CSDs  to retailers without the Cott Group's  prior written consent. In the event
that RCC wishes to acquire a company or business that is engaged in the business
of marketing private  label CSDs  to retailers (an  'RCC Restricted  Business'),
then  RCC  shall  discontinue  the  RCC  Restricted  Business  or  sell  the RCC
Restricted Business to a  third party not affiliated  with RCC within 12  months
after  RCC acquires  the RCC  Restricted Business. The  Cott Group  shall have a
right of first refusal to purchase the RCC Restricted Business.
 
     7. Fighter Brands. RCC agrees to work with BCB to supply PL Concentrates to
BCB to meet the demands of BCB's customers for 'fighter brands.' The prices  for
such  fighter brands shall be negotiated in  good faith. RCC agrees that it will
not develop  a  new brand  with  a full  line  of low-priced  flavors  which  is
specifically designed for the warehouse retail distribution system.
 
8. RCC PERFORMANCE OBLIGATIONS.
 
     (a)  The PL Concentrates sold by RCC  shall comply in all material respects
with all applicable  laws, rules  and regulations, including  the Federal  Food,
Drug  and Cosmetic Act, at the time of shipment. All PL Concentrates sold by RCC
shall be merchantable and fit for the  intended purpose at the time of  shipment
and  shall be designed to  meet the specifications of  the customers of the Cott
Group.  In  the   event  that   RCC's  quality  control   personnel  and   BCB's
representatives  agree that  any PL  Concentrates sold  by RCC  do not  meet the
foregoing standards, RCC's liability shall be limited to the replacement of  the
PL  Concentrates and the finished goods made from such defective PL Concentrates
and the reimbursement of costs throughout the supply chain caused by a recall of
products made from such defective PL  Concentrates in a fashion consistent  with
the  policy  followed by  RCC  with respect  to a  recall  of product  made from
defective branded concentrate. RCC shall also be responsible for claims by third
parties resulting solely from PL Concentrates proven to be defective. RCC  shall
not  be  responsible  for defective  PL  Concentrates produced  by  the Barbados
Facility unless  RCC's  quality  control  personnel  and  BCB's  representatives
mutually  determine  in  good  faith  that  the  emulsions  from  which  such PL
Concentrates were produced were defective.
 
     (b) BCB  agrees to  furnish  RCC with  its  projected requirements  for  PL
Concentrates  for  each  calendar year  by  not  later than  December  1  of the
preceding  calendar  year.  BCB  shall   deliver  updated  projections  of   its
requirements  for PL Concentrates for  the next 12 months  on or before March 1,
June 1, and September 1 of each  year. All such projections shall specify, on  a
month  by month basis, BCB's requirements for  each flavor or product. BCB shall
also (a) deliver monthly reports to RCC on BCB's actual sales for the  preceding
month  and  (b) notify  RCC  as soon  as  possible of  any  significant business
developments  which  would  be  likely   to  cause  changes  in  its   projected
requirements.  RCC  will agree  to deliver  PL Concentrates  as ordered  by BCB,
provided that the  volumes actually  ordered by BCB  do not  exceed the  amounts
specified  in  BCB's  most recent  projections,  and RCC  will  use commercially
reasonable efforts  to  fill  orders  by  BCB for  amounts  in  excess  of  such
projections.  RCC shall accord the same priority to BCB's orders that it accords
to the orders of RCC's franchises  for RCC's branded concentrates. In the  event
that  RCC  repeatedly fails  to deliver  the  volumes ordered  by BCB  in timely
fashion, provided that such volumes do not exceed the amounts specified in BCB's
most recent projections, and such repeated failures are reasonably determined by
the Cott Group to have had, or
 
                                       4
 
<PAGE>
may reasonably be expected to  have in the future  a material adverse effect  on
the  Cott Group's  financial condition  or results  of operations,  then BCB may
notify RCC in writing of such failures. RCC shall have the right to  demonstrate
that  the  Cott Group's  expectations of  a future  material adverse  effect are
unreasonable. If, during  the first  365 days  after RCC  receives such  written
notice,  deliveries by RCC  continue to be untimely  or in amounts substantially
less than the amounts ordered by BCB,  provided that the volumes ordered by  BCB
do  not exceed the amounts  specified in BCB's most  recent projections, and the
Cott Group reasonably determines that such failures by RCC continue to have had,
or may reasonably be expected to have  in the future, a material adverse  effect
on  the Cott Group's financial condition or  results of operation, then the Cott
Group may,  by written  notice,  elect to  terminate  the New  Supply  Agreement
without  prejudice to the  Cott Group's other legal  rights and remedies arising
out of such breach. RCC shall not be responsible for failing to fill orders  (i)
for amounts in excess of the amounts specified in the projections or (ii) to the
extent  that such failure resulted from  RCC's inability to obtain raw materials
because BCB did  not give RCC  sufficient advance  notice of a  change in  BCB's
requirements.
 
     9.  Pricing  and Payment.  The price  structure  shall be  as set  forth in
Exhibit A. BCB shall make  all payments to RCC within  30 days of shipment  from
RCC's production center.
 
     10.  Term. The effective date of the  New Supply Agreement shall be January
1, 1994 and the  initial term of  the New Supply  Agreement shall be  twenty-one
years. The parties agree to negotiate in good faith the terms of an extension to
the New Supply Agreement during the nineteenth year of the effective date of the
New  Supply  Agreement.  If the  parties  have not  agreed  to the  terms  of an
extension by the twentieth anniversary of  the effective date of the New  Supply
Agreement,  then the term of the New  Supply Agreement shall be extended for six
years, and the terms and conditions of the extended agreement shall be the  same
as  the  terms  and conditions  of  the  New Supply  Agreement.  The  New Supply
Agreement will be subject to similar six-year extensions as follows: at the  end
of  the fifth year of each extended term, the parties agree to negotiate in good
faith the terms of another extension to the New Supply Agreement. If the parties
have not agreed to the terms of  an extension within six months after the  fifth
anniversary  of  the  current  extension, then  the  New  Supply  Agreement will
automatically be extended  for an  additional six years  on the  same terms  and
conditions. Such six-year extensions shall continue successively notwithstanding
the failure of the parties during any such extension to agree upon the terms and
conditions  of another  extension. Notwithstanding  the foregoing,  either party
may, at  its election,  refuse  to agree  to any  extension  of the  New  Supply
Agreement,  in which case Paragraph 4  hereof shall apply to determine ownership
of formulae.
 
     11. Hiring.  The Cott  Group and  RCC agree  not to  solicit for  hire  key
employees from each other's organizations.
 
     12.  New  International  Activities.  RCC  acknowledges  that  it presently
supplies the Cott Group  with PL Concentrates in  Canada and the United  States.
RCC  further acknowledges that Cott, through  BCB, is actively pursuing the sale
of private label beverages in countries outside of Canada and the United States.
In order to enhance this activity, and to satisfy its obligation under paragraph
one (1) of this letter BCB is contemplating the use of an emulsifying  finishing
facility  (the 'International Facility') in a location outside the United States
or Canada. BCB expects to acquire or construct the International Facility or  to
obtain  the use of the International  Facility through a lease, license, tolling
or other arrangement  through a third  party. RCC will  cooperate with BCB  with
respect  to the International Facility, on the understanding that RCC, on behalf
of BCB, controls  and directs 100%  of the supply  of all concentrate  emulsions
manufactured  by RCC and sent to the  International Facility. The prices for the
emulsions sold by  RCC to BCB  shall result  in the operating  profit per  Case,
determined  in accordance with generally  accepted accounting principles, earned
by RCC  being equal  to  the operating  profit  per Case  earned  by RCC  on  PL
Concentrates manufactured at RCC's Columbus, Georgia facility as of December 31,
1993.  The  Cott Group  will indemnify  RCC  against any  duties, fees  or taxes
(including withholding, gross  receipts, value  added, income or  other type  of
taxes)  imposed  by the  government of  the country  in which  the International
Facility is located that are attributable to the activities contemplated by  the
New  Supply Agreement. RCC will not  bear any development and construction costs
relating to the International Facility. BCB agrees to retain the services of  an
 
                                       5
 
<PAGE>
employee  or employees  of RCC  or its subsidiaries  to occupy  the positions of
plant manager  and  other  key  positions (as  required)  of  the  International
Facility.
 
     13.  Quality Control Services. RCC will provide quality control services at
the same level as provided with respect to RCC's own branded products, including
the provision of  technical support  to the  Cott Group's  bottling and  canning
locations,  including the  International Facility,  provided, however,  that RCC
will not be  responsible for  the selection,  testing or  approval of  container
closures  and other packaging materials for  the finished CSDs. In consideration
of such services, during each  year of the first ten  years of the operation  of
the International Facility, BCB will pay to RCC a fee of $[deleted, confidential
treatment requested pursuant  to Rule 406]. Such fee will
be payable upon the commencement of operations of the International Facility and
on each of the first [deleted, confidential treatment requested pursuant to Rule
406] anniversaries thereof.
 
     14.  Guaranty. Cott will  guarantee all of BCB's  obligations under the New
Supply Agreement.
 
     15. Use of RCC Bottlers. Cott agrees to use commercially reasonable efforts
to cause the private label and proprietary label CSDs produced in North  America
in  bottles, cans or other  containers by the Cott Group  to be bottled by RCC's
franchisees wherever possible, provided, however,  that the Cott Group shall  be
relieved  of such obligation to  the extent that a  franchisee does not have the
physical or  technical  capability  to  meet Cott's  requirements  on  the  most
cost-effective basis, as determined by Cott in its sole discretion.
 
     16.  Fountain Syrup. During the period January 1, 1994 through December 31,
1995, RCC will manufacture and  sell to BCB, and BCB  will purchase, all of  the
Cott Group's worldwide requirements for cola concentrates or cola emulsions used
in  the production of cola concentrates used  in the production of private label
and Cott Group proprietary label fountain syrup (collectively 'PL Cola  Fountain
Syrup')  produced or sold by or on  behalf of the Cott Group. Wherever possible,
BCB will  during such  two-year period  use commercially  reasonable efforts  to
purchase   all  of  the   Cott  Group's  worldwide   requirements  for  non-cola
concentrates or non-cola emulsions used in the production of concentrate used in
the production of private label and Cott Group proprietary label fountain  syrup
(collectively  'PL Non-Cola Fountain Syrup' and,  together with PL Cola Fountain
Syrup, 'PL Fountain Syrup') produced or sold by or on behalf of the Cott  Group.
BCB  agrees  that  during 1995,  at  least  75% of  the  Cott  Group's aggregate
worldwide requirements for PL Fountain Syrup will be purchased from RCC.  During
this  two-year period, RCC  will not sell  PL Fountain Syrup  to customers other
than the Cott Group.  The pricing for  the PL Fountain Syrup  will be
$[deleted, confidential treatment requested pursuant  to Rule 406]  per
Case  for  regular  colas and  diet  colas,  with diet  colas  adjusted  for any
differences in costs of ingredients and direct packaging. Such costs and  prices
will  be reviewed quarterly and adjusted by the same mechanisms as are set forth
in Exhibit A. Additionally, RCC will  provide PL Fountain Syrup packing to  Cott
at  a rate competitive  with the rate  charged by other  national fountain syrup
packers.
 
     If Cott  commits to  developing the  sales in  the fountain  syrup  segment
during  this  two-year  period, then  Cott  and RCC  will  negotiate appropriate
performance minimums for PL  Fountain Syrup and PL  Fountain Syrup will be  made
subject  to the  New Supply  Agreement. If  the parties  are unable  to agree on
appropriate performance minimums for PL  Fountain Syrup, then PL Fountain  Syrup
will  not be subject  to the New Supply  Agreement and the  parties will have no
obligations to each other with respect to  PL Fountain Syrup. If the Cott  Group
decides during the two-year period not to pursue the development of sales in the
PL  Fountain Syrup segment, then BCB will so  advise RCC on behalf of itself and
the Cott Group. RCC will be free to sell PL Fountain Syrup to other customers if
the Cott Group decides not to pursue sales in the fountain syrup segment.
 
     17. Miscellaneous. All references herein to '$' or 'dollars' are references
to United  States dollars.  All references  herein to  the Cott  Group shall  be
deemed  to be references to each member of  the Cott Group and to all members of
the Cott Group  collectively. RCC shall  have the right  to utilize the  foreign
sales  corporation provisions  of the  Internal Revenue  Code and  to assign its
rights and obligations under the New  Supply Agreement, provided that RCC  fully
guarantees the assignee's obligations thereunder.
 
                                       6
 
<PAGE>
     The  foregoing is a binding contractual obligation  of each of RCC and Cott
and BCB.  The parties  intent to  execute and  deliver a  definitive New  Supply
Agreement,  but until a definitive New Supply Agreement is executed, this letter
agreement shall be deemed a binding agreement.
 
                                          Very truly yours,
 
                                          ROYAL CROWN COLA CO.
                                                /s/ 
                                          By:  .................................
                                                 John C. Carson, President
 
Accepted and agreed:
COTT CORPORATION
      /s/
BY:  .................................
    Fraser Latta
    Vice Chairman & COO
 
BCB INTERNATIONAL LIMITED
      /s/
BY:  .................................
    Ed Szczepanowski
    Vice President
 
                                       7
 
<PAGE>
                     RCC/COTT SUPPLY AGREEMENT -- EXHIBIT A
 
             [deleted, confidential treatment requested pursuant to Rule 406]




<PAGE>
                                                                    EXHIBIT 23.1
 
              CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
 
     As independent certified public accountants,  we hereby consent to the  use
of  our reports and to all references to our  firm included in or made a part of
this registration statement.
 
                                          ARTHUR ANDERSEN & CO.
 
Miami, Florida,
March 10, 1994.



<PAGE>
                                                                    EXHIBIT 23.2
 
[LOGO]
 
                                          March 8, 1994
 
The Board of Directors
Southeastern Public Service Company
777 S. Flagler Drive
West Palm Beach, FL 33401
 
Attention: David E. Schwab II, Esq.
         Sir Ian MacGregor
         The Special Committee of
         The Board of Directors
 
The Board of Directors
Triarc Companies Inc.
777 S. Flagler Drive
West Palm Beach, FL 33401
Attention: Curtis S. Gimson, Esq.
 
     Re: Proxy Statement of Southeastern Public Service
        Company and Registration Statement of Triarc
        Companies, Inc. to be filed with the Securities
        and Exchange Commission on March 10, 1994
        (the 'Proxy Statement-Prospectus')
 
     Gentlemen:
 
     We hereby consent to the references  to Smith Barney Shearson Inc. and  the
description of our opinion, valuation analyses of SEPSCO and Triarc and analysis
of certain claims alleged in the Complaint in the Ehrman Litigation contained in
the  Proxy Statement-Prospectus under  'SUMMARY-The Merger-Recommendation of the
SEPSCO Board'  and  '-Opinion of  Financial  Advisor,' and  'SPECIAL  FACTORS  -
Recommendation  of the  SEPSCO Special  Committee and  the SEPSCO  Board' and '-
Opinion of Financial Advisor,' the inclusion  of our opinion dated November  22,
1993  as Annex II to the Proxy  Statement-Prospectus, and the reference to Smith
Barney Shearson  Inc. and  our  opinion in  the copy  of  the letter  to  SEPSCO
stockholders   proposed  to  be  mailed  with  the  Proxy  Statement-Prospectus.
Undefined terms used herein have the  meaning set forth in the Proxy  Statement-
Prospectus .
 
Very truly yours,

Smith Barney Shearson Inc.

Smith Barney Shearson Inc.





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