SCHEDULE 14A
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant []
Check the appropriate box:
[] Preliminary Proxy Statement [] Confidential, For Use of the Com-
mission Only (as permitted by
Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[] Definitive Additional Materials
[] Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
Triarc Companies, Inc.
- ------------------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)
- ------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if Other Than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
(1) Title of each class of securities to which transaction applies:
- ------------------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
- ------------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the filing fee
is calculated and state how it was determined):
- ------------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
- ------------------------------------------------------------------------------
(5) Total fee paid:
- ------------------------------------------------------------------------------
[] Fee paid previously with preliminary materials:
- ------------------------------------------------------------------------------
[] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number, or
the form or schedule and the date of its filing.
(1) Amount previously paid:
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(2) Form, Schedule or Registration Statement no.:
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(3) Filing Party:
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(4) Date Filed:
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<PAGE>
TRIARC COMPANIES, INC.
NOTICE OF ANNUAL
MEETING OF
STOCKHOLDERS AND
PROXY STATEMENT
========================================================================
PLEASE COMPLETE, SIGN, DATE AND RETURN
YOUR PROXY PROMPTLY
========================================================================
[Logo]
Wednesday, June 4, 1997 at 11:00 A.M.
at The Chase Manhattan Bank
270 Park Avenue
New York, New York
<PAGE>
[LOGO]
TRIARC COMPANIES, INC.
280 PARK AVENUE
NEW YORK, NEW YORK 10017
(212) 451-3000
May 9, 1997
Dear Stockholders:
It is our pleasure to invite you to join us at the 1997 Annual Meeting of
Stockholders of Triarc Companies, Inc. which will be held at 11:00 a.m., on
Wednesday, June 4, 1997, in the third floor auditorium of The Chase Manhattan
Bank, 270 Park Avenue, New York, New York.
We shall report to you at the meeting on the Company's current operations
and outlook. The meeting will also include a question and discussion period. The
Board of Directors and management hope that many of you will be able to attend
in person.
At the meeting, you will be asked to consider and vote on the election of
nine (9) directors, an amendment to the Certificate of Incorporation of Triarc
that changes the minimum and maximum number of directors of Triarc and the
ratification of the appointment of Deloitte & Touche LLP as the Company's
independent certified public accountants. The Board of Directors has unanimously
approved the proposals and recommends that you vote FOR each of them. Please
give this proxy material your careful attention, as the discussion is important
to your decisions on the matters being presented.
The formal notice of Annual Meeting and the Proxy Statement follow. It is
important that your shares be represented and voted, regardless of the size of
your holdings. Accordingly, whether or not you plan to attend the meeting in
person, please mark, sign, date and return the enclosed proxy. If you attend the
meeting and wish to vote your shares personally, you may revoke your proxy. Our
Annual Report (including our Annual Report on Form 10-K for the year ended
December 31, 1996) also accompanies these proxy materials.
Sincerely,
NELSON PELTZ PETER W. MAY
Chairman and Chief President and Chief
Executive Officer Operating Officer
<PAGE>
[LOGO]
TRIARC COMPANIES, INC.
NOTICE OF 1997 ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON WEDNESDAY, JUNE 4, 1997
11:00 A.M., LOCAL TIME
-------------------
The 1997 Annual Meeting of Stockholders of Triarc Companies, Inc. will
be held on Wednesday, June 4, 1997, at 11:00 a.m., local time, in the third
floor auditorium of The Chase Manhattan Bank, 270 Park Avenue, New York, New
York, for the following purposes:
(1) to elect nine (9) directors to hold office as specified in
the accompanying Proxy Statement;
(2) to consider and act upon an amendment to the Company's
Certificate of Incorporation to change the minimum number of directors
to seven (7) and the maximum number of directors to fifteen (15);
(3) to ratify the appointment of Deloitte & Touche LLP as the
Company's independent certified public accountants; and
(4) to transact such other business as may properly come before
the meeting or any adjournment or postponement thereof.
Stockholders entitled to vote at the meeting or any adjournment or
postponement thereof are holders of record of the Company's Class A Common Stock
at the close of business on April 21, 1997.
By order of the Board of Directors
STUART I. ROSEN
Vice President and
Associate General Counsel, and
Secretary
May 9, 1997
YOUR VOTE IS IMPORTANT! STOCKHOLDERS ARE CORDIALLY INVITED TO ATTEND THE
MEETING. WHETHER OR NOT YOU PLAN TO ATTEND, PLEASE COMPLETE, SIGN AND DATE THE
ENCLOSED PROXY AND RETURN IT PROMPTLY IN THE ENCLOSED ENVELOPE. YOU MAY
NEVERTHELESS VOTE IN PERSON IF YOU ATTEND THE MEETING.
===============================================================================
<PAGE>
TRIARC COMPANIES, INC.
280 PARK AVENUE
NEW YORK, NEW YORK 10017
(212) 451-3000
-------------------
PROXY STATEMENT
-------------------
INTRODUCTION
GENERAL
The accompanying proxy is solicited by the Board of Directors (the
"Board of Directors" or the "Board") of Triarc Companies, Inc. (the "Company" or
"Triarc") in connection with the 1997 Annual Meeting of Stockholders of the
Company to be held on Wednesday, June 4, 1997, at 11:00 a.m., local time, in the
third floor auditorium of The Chase Manhattan Bank, 270 Park Avenue, New York,
New York (the "Meeting"), and at any adjournment or postponement of the Meeting.
This Proxy Statement and a proxy are first being mailed to stockholders on or
about May 12, 1997. The mailing address of the Company's principal executive
office is 280 Park Avenue, New York, New York 10017.
When a proxy is returned properly dated and signed, the shares
represented thereby will be voted by the persons named as proxies in accordance
with each stockholder's directions. Stockholders may specify their choices by
marking the appropriate boxes on the enclosed proxy. If a proxy is dated, signed
and returned without specifying choices, the shares will be voted as recommended
by the Board of Directors FOR the election of each of the nine (9) nominees for
directors named below and FOR Proposals (2) and (3). The Company does not have
cumulative voting in the election of directors. Under the Company's By-Laws (the
"By-Laws"), business transacted at the Meeting is confined to the purposes
stated in the Notice of the Meeting. The proxy being solicited does, however,
convey discretionary authority to the persons named therein as proxies to vote
on matters incident to the conduct of the Meeting. The proxy may be revoked by
the stockholder at any time prior to the time it is voted by giving notice of
such revocation either personally or in writing to the Secretary of the Company
at the address provided above.
VOTING SECURITIES
All holders of record of the Company's Class A Common Stock, par value
$.10 per share (the "Class A Common Stock"), at the close of business on April
21, 1997 are entitled to vote on all business of the Meeting. At the close of
business on such day, the Company had 23,946,242 shares of Class A Common Stock
outstanding and entitled to vote at the Meeting. Each share of Class A Common
Stock entitles the holder to one vote per share. The presence, in person or by
proxy, of stockholders entitled to cast at least a majority of the votes which
all stockholders are entitled to cast shall constitute a quorum.
Under the General Corporation Law of the State of Delaware, the state in
which the Company is incorporated, the Company's Certificate of Incorporation
and the Company's By-Laws, if a quorum is present at the
Meeting, the affirmative vote of a plurality of the votes cast is required for
the election of directors and the affirmative vote of a majority of the voting
power present (in person or by proxy) and entitled to vote at the Meeting is
required for approval of
<PAGE>
Proposals (2) and (3). Under Delaware law, an abstaining vote is not deemed to
be a "vote cast." As a result, abstentions and broker "non-votes" are not
included in the tabulation of the voting results on the election of directors or
issues requiring approval of a majority of the votes cast and, therefore, do not
have the effect of votes in opposition in such tabulations. A broker "non-vote"
occurs when a nominee holding shares for a beneficial owner does not vote on a
particular proposal because the nominee does not have discretionary voting power
with respect to that item and has not received instructions from the beneficial
owner. Broker "non-votes" and the shares as to which a stockholder abstains are
included for purposes of determining whether a quorum of shares is present at a
meeting.
The Company has been informed that the 5,982,867 shares of Class A
Common Stock (constituting approximately 25% of the outstanding shares of Class
A Common Stock) owned by DWG Acquisition Group, L.P., a Delaware limited
partnership of which Nelson Peltz and Peter W. May are the sole general partners
("DWG Acquisition"), will be voted in accordance with the recommendation of the
Board of Directors FOR the election of each of the nine (9) nominees for
director named below and FOR Proposals (2) and (3).
PROPOSAL 1.
ELECTION OF DIRECTORS
NOMINEES FOR ELECTION
It is recommended that the nine (9) nominees herein named be elected as
directors of the Company, with each director to hold office until the next
Annual Meeting of Stockholders, and until his successor is elected and qualified
or until his prior death, resignation or removal. All of the nine (9) nominees
are presently serving as directors of the Company and were elected directors at
the last Annual Meeting of Stockholders held on June 6, 1996, to serve until the
next annual meeting of the Company's stockholders and until such director's
successor is duly chosen and qualified or until his prior death, resignation or
removal. The Company is unaware of any reason why any of the nominees named
herein would be unwilling or unable to serve as a director. Should, however, any
nominee for director be unwilling or unable to serve at the time of the Meeting
or any adjournment or postponement thereof, the persons named in the proxy will
vote for the election of such other person for such directorship as the Board of
Directors may recommend. Mr. M.L. Lowenkron, who was also elected as a director
of the Company at such Annual Meeting of Stockholders has determined not to
stand for reelection, but will continue to serve as a director of the Company
until the Meeting. If Proposal (2) (described below) is not approved by the
stockholders of the Company, the Board of Directors will, subsequent to the
Meeting, fill the vacancy created by Mr. Lowenkron's decision not to stand for
reelection.
Certain information regarding each person nominated by the Board of
Directors, including his principal occupation during the past five years and
current directorships, is set forth below. Unless otherwise indicated, all
nominees have had the indicated principal occupations for the past five years.
<PAGE>
BUSINESS EXPERIENCE DURING PAST
NAME OF DIRECTOR FIVE YEARS, AGE AND OTHER INFORMATION
- ---------------- -------------------------------------------
Nelson Peltz....... Mr. Peltz has been a director and Chairman and
Chief Executive Officer of the Company since
April 23, 1993. Since then, he has also been a
director and Chairman of the Board and Chief
Executive Officer of certain of the Company's
subsidiaries, including RC/Arby's Corporation,
formerly known as Royal Crown Corporation ("RCAC")
and a director of National Propane Corporation
("NPC"), the managing general partner of National
Propane Partners, L.P. (the "Partnership"), a
distributor of liquefied petroleum gas. Since
April 1997 Mr. Peltz has also served as Chairman
of the Board of NPC. He is also a general partner
of DWG Acquisition, whose principal business is
ownership of securities of the Company. 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. Mr. Peltz is 54 years of age.
Peter W. May....... Mr. May has been a director and President and
Chief Operating Officer of the Company since
April 23, 1993. Since then, he has also been a
director and President and Chief Operating
Officer of certain of the Company's subsidiaries,
including RCAC and a director of NPC. Since
April 1997, Mr. May has also served as Vice
Chairman of NPC. 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 is 54 years of age.
Hugh L. Carey....... Mr. Carey has been a director of the Company
since June 9, 1994. He was an Executive Vice
President of W.R. Grace & Co. ("Grace") from 1987
to December 31, 1995. From 1993 to December 31,
1995, he served Grace as director of its
Government Relations Division, and from 1987
until 1993, he ran Grace's office of
environmental policy. Mr. Carey was the Governor
of the State of New York from 1975 until 1983 and
a member of Congress from 1960 until 1975. From
<PAGE>
1991 until 1993, he was Chairman of the National
Institute of Former Governors. Mr. Carey is also
a director of China Trust Bank and PhyMatrix,
Inc.; of Counsel to Whitman Breed Abbott & Morgan
and Chairman of the Board of Advisors to
Cambridge Partners, L.L.C. Mr. Carey is 78 years
of age.
Clive Chajet....... Mr. Chajet has been a director of the Company
since June 9, 1994. He has been Chairman of
Chajet Consultancy, L.L.C., a consulting firm
specializing in identity and image management,
since January 1997. Prior thereto, Mr. Chajet
was Chairman of Lippincott & Margulies Inc., also
a consulting firm specializing in identity and
image management, from 1983 to January 1997. Mr.
Chajet is 60 years of age.
Stanley R. Jaffe....... Mr. Jaffe has been a director of the Company
since June 9, 1994. Mr. Jaffe is a motion picture
producer and owner of Jaffilms, LLC. From 1991
until 1994, Mr. Jaffe was President and Chief
Operating Officer and a Director of Paramount
Communications Inc., a motion picture and
entertainment company. From prior to 1988 until
1991, Mr. Jaffe was principal partner in
Jaffe/Lansing Productions, an independent motion
picture production company. Mr. Jaffe is 56 years
of age.
Joseph A. Levato....... Mr. Levato has been a director of the Company
since June 6, 1996. Mr. Levato served as
Executive Vice President and Chief Financial
Officer of Triarc from April 24, 1993 to August
1996. He also served as Executive Vice President
and Chief Financial Officer of certain of
Triarc's subsidiaries, including RCAC, from
April 24, 1993 to August 1996. Prior to April
1993, 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. Mr. Levato is 56
years of age.
David E. Schwab ....... Mr. Schwab has been a director of the Company
since October 1994. Mr. Schwab has been a partner
of Schwab Goldberg Price & Dannay, a law firm,
for more than five years. Mr. Schwab also serves
as Chairman of the Board of Trustees of Bard
College. Mr Schwab is 65 years of age.
Raymond S. Troubh....... Mr. Troubh has been a director of the Company
since June 9, 1994. He has been a financial
consultant since prior to 1989. Mr. Troubh is a
director of ADT Limited, America West Airlines,
<PAGE>
Inc., ARIAD Pharmaceuticals, Inc., Becton,
Dickinson & Co., Diamond Offshore Drilling, Inc.,
Foundation Health System, Inc., General American
Investors Company, Olsten Corporation, Petrie
Stores Corporation, Time Warner Inc., and WHX
Corporation. Mr. Troubh is 71 years of age.
Gerald Tsai, Jr........ Mr. Tsai has been a director of the Company since
October 1993. Since February 1993, he has been
Chairman of the Board, President and Chief
Executive Officer of Delta Life Corporation, a
life insurance and annuity company with which Mr.
Tsai became associated in 1992. Mr. Tsai also
serves as a director of 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 is 68 years
of age.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE ELECTION OF EACH OF THE NINE
NOMINEES NAMED ABOVE.
EXECUTIVE OFFICERS
The following table sets forth certain information regarding the executive
officers of Triarc, all of whom (other than John C. Carson, who is a British
citizen) are U.S. citizens.
NAME AGE POSITIONS
- -------------------------------------------------------------------------------
Nelson Peltz 54 Director; Chairman and Chief Executive Officer
Peter W. May 54 Director; President and Chief Operating Officer
Michael Weinstein 48 Chief Executive Officer of the Triarc Beverage Group
John C. Carson 51 Chairman of the Triarc Beverage Group
Roland C. Smith 42 President of the Triarc Restaurant Group
Ronald D. Paliughi 53 President and Chief Executive Officer of National
Propane Corporation
Brian L. Schorr 38 Executive Vice President, General Counsel, and
Assistant Secretary
John L. Barnes, Jr 49 Senior Vice President and Chief Financial Officer
John L. Cohlan 40 Senior Vice President -- Corporate Finance
Eric D. Kogan 33 Senior Vice President -- Corporate Development
Francis T. McCarron 40 Senior Vice President -- Taxes
Martin M. Shea 53 Senior Vice President -- Corporate Communications
Stuart I. Rosen 37 Vice President and Associate General Counsel, and
Secretary
Fred H. Schaefer 52 Vice President and Chief Accounting Officer
Set forth below is certain additional information concerning the persons
listed above (other than Messrs. Peltz and May, for whom such information has
been provided under "Nominees for Election" above).
Michael Weinstein has served as Chief Executive Officer of the Triarc
Beverage Group and Royal Crown since October 1996. Mr. Weinstein has also served
as Chief Executive Officer of Mistic Brands, Inc. ("Mistic") since August 9,
1995, when Mistic was acquired by Triarc. Prior to August 1995, he was president
of Liquid Logic, a private beverage consulting business he founded in 1994. From
1981 until the end of 1993, he served in various executive capacities at A&W
Brands, Inc. lastly as President/Chief Operating Officer. From 1978 to 1981, he
was a Vice President at Kenyon & Eckhardt Advertising. He began his career at
Pepsi-Cola Company, where he held various sales and marketing positions from
1972 to 1978.
<PAGE>
John C. Carson has been Chairman of the Triarc Beverage Group since
October 1996. Prior thereto, he had served as President and Chief
Executive Officer of Royal Crown Company, Inc. from April 24, 1993 to
October 1996. Prior to April 1993, Mr. Carson was President of Cadbury
Beverages, North America, a subsidiary of Cadbury Schwepps, PLC, where he
was also a member of Cadbury Beverages Global Board. Mr. Carson was
President of Schwepps N.A. from 1984 to 1988, vice president of sales and
marketing of Schwepps Bottling U.K. and Cadbury U.K. from 1964 to 1981.
Roland C. Smith has been President of the Triarc Restaurant Group
(Arby's, Inc.) since February 1997. Prior thereto, Mr. Smith had served in
various positions at Arby's, Inc. since July 1994 (last serving as Senior
Vice President and General Manager of Arby's, Inc. since August 1996). From
January 1992 to July 1994 Mr. Smith served in various positions at KFC
International, last serving as General Manager - Western Canada.
Ronald D. Paliughi has been President and Chief Executive Officer of
NPC, the managing general partner of the Partnership, 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 liquefied petroleum 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, a liquefied petroleum gas company, and for more than
14 years prior thereto, he held various positions with Vangas, Inc., last
serving as Senior Vice President -- General Manager.
Brian L. Schorr has been Executive Vice President and General Counsel of
Triarc and certain of its subsidiaries since June 29, 1994. Prior thereto, Mr.
Schorr was a partner of Paul, Weiss, Rifkind, Wharton & Garrison, a law firm
which he joined in 1982 and subsequent thereto through April 1995 he was Of
Counsel to that firm in connection with limited liability company and limited
liability partnership matters. That firm provides legal services to Triarc and
its subsidiaries.
John L. Barnes, Jr. has been Senior Vice President and Chief
Financial Officer of Triarc since August 1996 and was Senior Vice
President of Triarc from April 1996 to August 1996. Prior thereto, Mr.
Barnes had served as Executive Vice President and Chief Financial Officer
of Graniteville Company (which was sold by the Company in April 1996) for
more than five years.
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 RCAC, since January 1994.
Prior thereto, he had served as Senior Vice President -- 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
1989 until 1991, he was a principal of The Palmer Group, Inc., a firm
specializing in corporate restructurings, particularly in the hotel industry.
<PAGE>
Eric D. Kogan has been Senior Vice President -- Corporate Development of
Triarc since March 1995. Prior thereto, he was Vice President --Corporate
Development of Triarc since April 24, 1993. Before joining Triarc, Mr. Kogan was
a Vice President of Trian Group, L.P. from September 1991 to April 1993 and an
associate in the mergers and acquisitions group of Farley Industries, an
industrial holding company, from 1989 to August 1991.
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 RCAC, 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.
Martin M. Shea has been Senior Vice President -- Corporate
Communications of Triarc from July 1994 through May 1995 and from November 1995
to the present. From June 1995 through October 1995, he served as Managing
Director at Edelman Worldwide. Prior to July 1994, he served in various
capacities in the investor relations department of Paramount Communications Inc.
since 1977, including Vice President -- Investor Relations since 1992 and
Assistant Vice President -- Investor Relations from 1983 to 1992.
Stuart I. Rosen has been Vice President and Associate General Counsel,
and Secretary of Triarc and certain of its subsidiaries since August 1, 1994.
Prior thereto, he was associated with Paul, Weiss, Rifkind, Wharton & Garrison
since 1985.
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 RCAC, 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 Reporting, until
January 1989.
The term of office of each executive officer is until the organizational
meeting of the Triarc Board following the next annual meeting of Triarc
stockholders and until his successor is elected and qualified or until his prior
death, resignation or removal.
BOARD MEETINGS AND CERTAIN COMMITTEES OF THE BOARD
Nine meetings of the full Board of Directors were held during the fiscal
year ended December 31, 1996. Each incumbent director who is a nominee for
reelection attended more than 75% of the meetings of the Board of Directors that
were held after such director's election to the Board and more than 75% of all
committees of the Board of Directors that he was eligible to attend in 1996.
The Company has standing audit, nominating, and compensation committees
whose current functions and members are described below. It is anticipated that
at its first meeting following the Meeting, the Board
<PAGE>
will designate the directors to serve on each of these Committees until the next
annual meeting of stockholders.
Audit Committee. The Audit Committee is composed of Messrs. David E.
Schwab II (Chairman), Stanley R. Jaffe, Raymond S. Troubh and Gerald Tsai,
Jr. This Committee is charged with the responsibility of overseeing the
financial reporting process of the Company. In the course of performing
its functions, the Audit Committee (i) reviews the Company's internal
accounting controls and its annual consolidated financial statements, (ii)
reviews with the Company'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 the Company's
independent certified public accountants. The Audit Committee met three
times during 1996.
Nominating Committee. The Nominating Committee is composed of Messrs.
Peter W. May (Chairman), Nelson Peltz, Hugh L. Carey and M. L. Lowenkron.
This Committee is charged with the responsibility of considering and
recommending individuals to be considered by the Board for membership on
the Board of Directors. The Nominating Committee met once during 1996.
The Nominating Committee will consider nominations for Board membership
by stockholders. The Nominating Committee has adopted the following rules with
respect to considering such nominations: (i) the nominating stockholder must
have owned shares of Class A Common Stock or (to the extent entitled to vote for
Directors) other classes of common stock or preferred stock 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 nomination 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. Gerald Tsai, Jr. (Chairman), Clive Chajet, David E. Schwab II and
Raymond S. Troubh. 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 applicable
to the executive officers of the Company, (ii) taking all actions with
respect thereto that are not specifically reserved for the Board of
Directors, and (iii) administering the Triarc Companies, Inc. 1993 Equity
Participation Plan (the "Equity Participation Plan") and such other salary
or compensation plans as the Committee is designated to administer. The
Compensation Committee met five times during 1996.
COMPENSATION OF DIRECTORS
Each non-management director of the Company receives an annual retainer
of $25,000 for serving on the Board. In addition, each non-management director
of the Company also receives $1,000 for each meeting of the Board or of a
Committee of the Board attended by him. At the option of each non-management
director, these fees may be paid in shares of Class A Common Stock rather than
in cash. See "Executive
<PAGE>
Compensation -- Certain Employment Arrangements with Executive Officers" below
for certain information relating to compensation of the Company's management
directors.
In addition, pursuant to the Equity Participation Plan, each director of
the Company who is not also an employee of the Company or any subsidiary
receives options to purchase 15,000 shares of Class A Common Stock on the date
of his initial election or appointment to the Board of Directors and, in
connection therewith, tandem stock appreciation rights ("SARs") for the same
number of shares. On the date of each subsequent annual meeting of stockholders
of the Company at which a director is reelected, such director will receive
options to purchase 3,000 shares of Class A Common Stock and, in connection
therewith, SARs for the same number of shares.
For information concerning certain fees paid to certain former directors
of Triarc and related matters, see "Item 3. Legal Proceedings" in the Company's
Annual Report on Form 10-K for the year ended December 31,1996.
COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT
Section 16(a) of the Securities Exchange Act of 1934, as amended,
requires Triarc's directors, executive officers, and persons who own more than
ten percent of Triarc's common stock, to file reports of ownership and changes
in ownership on Forms 3, 4 and 5 with the Securities and Exchange Commission
(the "SEC") and the New York Stock Exchange. Directors, executive officers and
greater than ten percent stockholders are required by the SEC regulations to
furnish Triarc with copies of all Forms 3, 4 and 5 they file.
Based solely on Triarc's review of the copies of such forms it has
received, or written representations from certain reporting persons that no Form
5s were required for these persons, Triarc believes that all its directors,
executive officers, and greater than ten percent beneficial owners complied with
all filing requirements applicable to them with respect to 1996 except for the
following inadvertent omission: Mr. Smith did not file his initial ownership
report on a timely basis. When this inadvertent omission was discovered, Mr.
Smith promptly filed the appropriate report.
VOTING SECURITIES AND PRINCIPAL HOLDERS THEREOF
The following table sets forth the beneficial ownership as of April 21,
1997 by each person known by the Company to be the beneficial owner of more than
5% of the outstanding shares of Class A Common Stock (constituting the only
class of voting capital stock of the Company), each director of the Company and
nominee for director of the Company who has such ownership, each executive
officer whose name appears in the Summary Compensation Table below (the "Named
Officers") who was an executive officer of the Company as of April 21, 1997 and
all directors and executive officers as a group.
<PAGE>
AMOUNT AND
NATURE
NAME AND ADDRESS OF OF PERCENT OF
BENEFICIAL OWNER OWNERSHIP(1) CLASS
- ----------------------------- ----------------- -------------
DWG Acquisition Group, L.P ..............5,982,867 shares (2) 25.0%
1201 North Market Street
Wilmington, DE 19801
Nelson Peltz ............................6,974,967 shares (2)(3)(4)(5) 28.0%
280 Park Avenue
New York, NY 10017
Peter W. May ............................6,653,000 shares (2)(3)(6) 27.1%
280 Park Avenue
New York, NY 10017
William Ehrman ..........................1,500,793(7)(8) 6.2%
Frederick Ketcher
Jonas Gerstl
Frederic Greenberg
James McLaren
300 Park Avenue
New York, NY 10022
Hugh L. Carey ............................ 27,451 shares (9) *
280 Park Avenue
New York, NY 10017
Clive Chajet ..............................27,300 shares(10) *
280 Park Avenue
New York, NY 10017
Stanley R. Jaffe ..........................28,777 shares (9) *
280 Park Avenue
New York, NY 10017
Joseph A. Levato .........................148,000 shares (11) *
280 Park Avenue
New York, NY 10017
M. L. Lowenkron ...........................22,500 shares (9) *
280 Park Avenue
New York, NY 10017
David E. Schwab II ........................23,000 shares (9) *
1185 Avenue of the Americas
New York, NY 10036
Raymond S. Troubh .........................39,500 shares (9) *
280 Park Avenue
New York, NY 10017
Gerald Tsai, Jr. ..........................32,826 shares (12) *
200 Park Avenue
Suite 4501
New York, NY 10166
Brian L. Schorr ...........................86,990 shares(13) *
280 Park Avenue
New York, NY 10017
John L. Cohlan ............................88,833 shares (14) *
280 Park Avenue
New York, NY 10017
Eric D. Kogan .............................68,000 shares (15) *
280 Park Avenue
New York, NY 10017
Directors and Executive
Officers as a group
(21 persons)...........................8,594,778 shares 32.5%
- ---------
<PAGE>
* Less than 1%
(1) Except as otherwise indicated, each person has sole voting and dispositive
power with respect to such shares.
(2) The Company is informed that DWG Acquisition has pledged such shares to
a financial institution on behalf of Messrs. Peltz and May to secure loans
made to them.
(3) Includes 5,982,867 shares held by DWG Acquisition, of which Mr. Peltz and
Mr. May are the sole general partners.
(4) Includes 200 shares owned by a family trust of which Mr. Peltz is a
general partner. Mr. Peltz disclaims beneficial ownership.
(5) Includes options to purchase 965,000 shares of Class A Common Stock which
have vested or will vest within 60 days of April 21, 1997.
(6) Includes options to purchase 643,333 shares of Class A Common Stock which
have vested or will vest within 60 days of April 21, 1997.
(7) The information set forth herein with respect to Messrs. Ehrman,
Greenberg, Ketcher, Gerstl and McLaren is based solely on information
contained in a Schedule 13D, dated July 16, 1996, filed pursuant to the
Securities Exchange Act of 1934, as amended.
(8) Includes an aggregate of 1,365,793 shares of Class A Common Stock that
Messrs. Ehrman, Ketcher, Gerstl, Greenberg and McLaren may be deemed to
beneficially own as general partners of EGS Associates, L.P., a Delaware
limited partnership, EGS Partners, L.L.C., a Delaware limited liability
company, Bev Partners, L.P., a Delaware limited partnership and Jonas
Partners, L.P., a Delaware limited partnership. Also includes (i) 55,150
shares of Class A Common Stock owned directly by Mr. Ehrman and 39,150
shares of Class A Common Stock owned by members of Mr. Ehrman's immediate
family; (ii) 23,600 shares of Class A Common Stock owned directly by Mr.
Ketcher and 1,100 shares of Class A Common Stock owned by a member of Mr.
Ketcher's immediate family and his mother-in-law; (iii) 2,500 shares of
Class A Common Stock owned directly by Mr. Gerstl and 8,500 shares of
Class A Common Stock owned by a member of Mr. Gerstl's immediate family;
and (iv) 2,000 shares of Class A Common Stock owned directly by Mr.
Greenberg and 3,000 shares of Class A Common Stock owned by a member of
Mr. Greenberg's immediate family.
(9) Includes options to purchase 19,500 shares of Class A Common Stock which
have vested or will vest within 60 days of April 21, 1997.
(10) Includes options to purchase 19,500 shares of Class A Common Stock which
have vested or will vest within 60 days of April 21, 1997 and 1,300 shares
owned by Mr. Chajet's wife, as to which shares Mr. Chajet disclaims
beneficial ownership.
(11) Includes options to purchase 120,000 shares of Class A Common Stock which
have vested or will vest within 60 days of April 21, 1997.
(12) Includes options to purchase 22,500 shares of Class A Common Stock which
have vested or will vest within 60 days of April 21, 1997.
(13) Includes options to purchase 80,000 shares of Class A Common Stock which
have vested or will vest within 60 days of April 21, 1997.
(14) Includes options to purchase 76,333 shares of Class A Common Stock which
have vested or will vest within 60 days of April 21, 1997
(15) Includes options to purchase 59,000 shares of Class A Common Stock which
have vested or will vest within 60 days of April 21, 1997.
-------------------
The foregoing table does not include 5,997,622 shares of Triarc's
non-voting Class B Common Stock owned by Victor Posner and certain affiliates of
Victor Posner as a result of a Settlement Agreement dated January 9, 1995 by and
among Victor Posner, certain affiliates of Victor Posner and the Company. For
information regarding this Settlement Agreement, see "Item 1. Business --
Introduction -- New Ownership; Posner Settlement" in Triarc's Annual Report on
Form 10-K for the year ended December 31, 1995. The shares of Class B Common
Stock can be converted without restriction into an equal number of shares of
Class A Common Stock following a transfer to a non-affiliate of Posner. The
Company has certain rights of first refusal if such shares are proposed to be
sold to an unaffiliated party. If the 5,997,622 currently outstanding shares of
the Class B Common Stock were converted into shares of Class A Common Stock,
such shares would constitute approximately 20.0% of the then outstanding shares
of Class A Common Stock as of April 21, 1997. None of the directors or nominees
for directors of the Company or the Named Officers beneficially owned any Class
B Common Stock as of April 21, 1997. Except for the arrangements relating to the
shares described in footnote (2) to the foregoing table, there are no
arrangements known to the Company the operation of which may at a subsequent
date result in a change in control of the Company.
<PAGE>
EXECUTIVE COMPENSATION
REPORT OF THE COMPENSATION COMMITTEE
Introduction. This report to stockholders presents an overview of both
the charter of the Compensation Committee of the Board of Directors (the
"Compensation Committee") and of the Company's compensation philosophy. It also
discusses the Compensation Committee's compensation related decisions in respect
of 1996 performance.
The Compensation Committee's Role. The Compensation Committee's
principal function is to review and approve the compensation program for the
executive officers of the Company (the "Executive Compensation Program") and to
administer the Equity Participation Plan.
The Company's Executive Compensation Program is designed to motivate
executives to achieve the Company's business objectives, with a particular
emphasis on stockholder value. Certain of the Company's executive officers were
in 1996, and are currently, employed pursuant to multi-year employment
agreements, the purpose of which is to retain the services of such officers for
extended periods. The minimum salary to which each such executive officer is
entitled is specified in the employment agreement, but the annual bonus for such
executive officers, which is a major part of an executive officer's cash
compensation, and awards of stock options for executive officers, are approved
by the Compensation Committee, which is comprised entirely of non-management
directors. The principal terms of the employment agreements of certain executive
officers are described under "Employment Arrangements with Executive Officers"
below.
To fulfill its principal function, the Compensation Committee
specifically reviews and approves each of the elements of the Executive
Compensation Program and will continually assess the effectiveness of the
program as a whole. This includes reviewing the design of the Company's various
incentive plans for executive officers and assessing the competitiveness of the
overall Executive Compensation Program.
Overall Objectives of the Executive Compensation Program. The Executive
Compensation Program is designed to help the Company retain, motivate and
recruit the executive officers needed to maximize the Company's return to
stockholders. The Company's explicit objective is to pay at levels required to
secure the exceptionally talented executive officers, in particular, and
employees, in general, necessary to achieve its long-term financial, strategic
and stock price growth goals. Since one of the Company's objectives is rapid
revenue growth, both by internal expansion and through acquisitions, the Company
has recruited the executive talent required to run a company which is larger
than the Company in its present form.
Toward that end, the Executive Compensation Program is designed to
provide:
o Levels of compensation that are highly competitive with those provided
in the various markets in which the Company competes for its executive
resources.
o Incentive compensation that:
o varies in a consistent and predictable manner with the
financial performance of the Company and/or its various
business units;
o varies in a consistent and predictable manner with the
stock price performance of the Company; and
<PAGE>
o effectively rewards individual performance.
In designing and administering the Executive Compensation Program, the
Compensation Committee, acting on behalf of the stockholders, seeks an
appropriate balance among these objectives, the most important of which are
discussed in greater detail below.
Providing Highly Competitive Levels of Compensation. The Company
provides its executive officers with a total compensation package that -- at
expected levels of performance -- is generally intended to rank in the 75th
percentile of compensation packages provided to executives in the consumer
products and food and beverage industries (as adjusted to reflect the Company's
size, inclusive of franchise sales) who hold comparable positions or have
similar qualifications. In addition, such compensation takes into account the
highly unusual roles and combinations of responsibilities undertaken by Triarc's
executive officers.
Given the Company's aggressive stockholder return objectives, the
Company has designed salary and incentive programs intended to attract
exceptionally high-caliber executives and is committed to paying these same
executives a substantial portion of their compensation based directly on the
Company and business unit performance.
To establish appropriate competitive frames of reference, the Company
looks toward pay levels offered by leading-performance companies in the relevant
markets for executive talent. The Company periodically assesses an executive's
competitive level of compensation based on information drawn from a variety of
sources, including proxy statements, compensation surveys and external
compensation consultants. The Company's review of competitive compensation
levels incorporates a case-by-case approach that considers each position's
relative content, accountabilities and scope of responsibility. The Company also
takes into account its businesses, current size and expected growth, expected
contributions from specific executives and other similar factors. For senior
executive corporate officers, this review includes an examination of pay data
for comparable positions within the consumer products and food and beverage
industries, as well as data for other diversified holding companies and pay data
for individuals with backgrounds comparable to such officers. Comparisons for
senior unit officers were made to compensation rates for analogous positions in
the consumer products and food and beverage industries and general industry, as
appropriate to each unit's business, viewing each unit's senior executive
officer as a senior executive officer of a stand alone company. The Committee
paid particular attention to each position's specific mix and scope of
responsibilities relative to those for the surveyed positions.
The Committee is aware that companies selected for compensation
comparison purposes differ from those used for relative stockholder return
comparison purposes in this proxy statement's performance graph. The Committee
believes stockholders' interests are best served by providing compensation
necessary to attract needed exceptional executive talent from relevant labor
markets and that, in many cases, this talent will be attracted from sources
outside the performance comparison group since the diversified companies used
for comparison of relative stockholder return may not compete in any or all of
the businesses engaged in by the Company. The Committee believes this executive
resources strategy will enable the Company to exhibit long-term stockholder
returns above those evident in the performance graph comparison group.
While the expected value of an executive's compensation package is set
at a highly competitive level, each executive officer's pay package places a
significant portion of pay at risk, and the actual value of the package will
exceed or fall below this level depending on actual Company results. The Company
is committed to the pay-for-performance philosophy and has implemented an
Executive Compensation Program which ensures that stockholders receive
performance-for-pay.
<PAGE>
Ensuring Incentive Compensation Varies With Performance. The Executive
Compensation Program is designed to ensure that incentive compensation varies in
a consistent and predictable manner with the financial and stock performance of
the Company and/or its business units. Awards paid under the Company's annual
and long-term incentive plans will be directly tied to the Company's and its
units' short-and long-term financial performance, as well as the performance of
the Company's stock price.
In addition to annual incentive awards, in August 1996, the Compensation
Committee approved the payment of special bonuses to the executive officers of
the Company (including the Chairman and Chief Executive Officer and President
and Chief Operating Officer) in connection with their activities relating to the
successful monetization of certain of the Company's businesses that presented
strategic alternatives. Such bonuses for the Named Officers are included in the
Summary Compensation Table below. In making such awards, the Compensation
Committee took note of the fact that the completion of these transactions
resulted in the realization of substantial cash funds by the Company for use in
ongoing operations and business expansions and that the proceeds from the sale
of the Southeastern Public Service Company's and Graniteville Company's
businesses, together with funds received by the Company from National Propane
Corporation (in connection with the formation and recapitalization of National
Propane Partners, L.P.) and C.H. Patrick & Co., Inc. (in connection with a
refinancing of its then outstanding indebtedness), involved transactions in
excess of $500 million (which amount exceeded the Company's expectations) and
which culminated in the receipt by the Company of liquid funds of approximately
$200 million. In light of the Company's performance in 1996 and the successful
completion of the transactions described above, total cash compensation
(including incentive awards granted in March 1997 with respect to 1996 and
special bonuses granted in August 1996 (discussed above)) paid to the Company's
executive officers was generally higher than that paid to such executives with
respect to 1995.
The Company's various incentive plans each serve slightly different
purposes and, as such, employ different measures of performance and cover
different periods of time. Accordingly, an executive officer's total
compensation will not typically vary based on any single measure of Company or
business unit performance over a particular period of time. However, in
combination, these plans provide a powerful incentive -- focusing management
attention on those measures important to stockholders, and hold participants
accountable for poor results and reward them for superior accomplishments.
The Company also believes that effectively rewarding individual
performance helps drive managers to contribute in ways that enhance the
financial and stock performance of the Company and its various business units.
Although the Executive Compensation Program provides compensation that varies
with financial and stock price performance, an executive officer's incentive
awards may also be influenced by qualitative assessments of Company, business
unit and individual performance, as appropriate. For all executive officers,
these assessments are made by the Compensation Committee.
Overview of the Executive Compensation Program. The Executive
Compensation Program is comprised of three principal elements, the base salary
program, and annual and long-term incentives (consisting of the mid-term plans
for subsidiary executive officers and key employees discussed below and
restricted stock and option awards). Each of these is designed and administered
with the explicit purpose of furthering the stockholders' interests by
facilitating the employment of highly-talented executives and motivating them to
achieve exceptional levels of performance. An overview of each of these elements
and how each is intended to support stockholder interests are provided below.
Base Salary Compensation. The Company's base salary program is
intended to provide base salary levels that are competitive in the
external market for executive talent, reflect an individual's ongoing
performance, and are periodically adjusted based on the executive's
performance, the Company's overall financial performance and expected
salary increases in the market for executive talent.
<PAGE>
The Company believes the mix of elements in the Executive Compensation
Program is appropriate, and will periodically review base salary levels, their
relationship to the competitive market and to the other components of the
program.
Annual Incentive Compensation. The Company's annual cash
incentive plan for executive officers and key employees of the Company's
principal business units (the "Annual Plan") provides competitive annual
pay opportunities with 50% of amounts earned directly linked to the
Company's and/or business unit's annual financial performance, with the
remaining 50% being based on the individual's annual performance. The
Annual Plan sets annual incentive target awards at levels that are
competitive in the context of the Company's total Executive Compensation
Program, and the appropriate mix of variable and fixed compensation.
Financial performance is assessed annually against pre-set financial and
strategic objectives.
Each executive's individual performance award is tied to performance
measures most appropriate to his or her responsibilities. To reinforce the need
for teamwork and focus attention on overall Company objectives, all participants
have 50% of their award tied to corporate or unit financial performance, as
defined by operating income and other measures selected at the outset of each
plan year. For additional information regarding the Annual Plan, see "Employment
Arrangements with Executive Officers -- Cash Incentive Plans" below.
The Compensation Committee believes that the Annual Plan plays a
critical role in the Company's ability to attract desired executives and
motivate them toward aggressive levels of performance.
In addition, annual incentives for the Company's corporate staff (other
than the Chairman and Chief Executive Officer and President and Chief Operating
Officer) are determined by the Compensation Committee on a discretionary basis,
based on interim and year-end reviews of performance relative to strategic and
financial objectives. The Compensation Committee believes that a less
discretionary process would be impractical during the current period of relative
uncertainty, as the Company's corporate center and businesses are restructured.
The Company intends to move to a more formalized annual incentive plan that
determines awards based on Company or unit performance and achievement of
specific objectives when appropriate.
Long-Term Incentive Compensation. The Company provides the
executive officers and key employees of its principal business units
with incentives linked to longer-term business unit and corporate
performance through mid-term cash incentive plans (the "Mid-Term
Plans"), and the Equity Participation Plan. The combination of these two
key elements is intended to provide competitive long-term incentive
opportunities, enable participants to build significant wealth when
meaningful stockholder wealth has been created, and directly link a
significant portion of total pay to the Company's long-term stock
performance and, as appropriate, to business unit longer-term financial
performance.
Triarc has had Mid-Term Plans for executive officers and key employees
of each of Royal Crown, Mistic, Arby's and National Propane. Each Mid-Term Plan
for the Company's principal business units provides for cash awards to
participants based on the unit's profit performance over a three-year period,
except in the case of Mistic's Mid-Term Plan, where profit performance is
measured over a five-year period. A pool is created based upon the amount by
which the unit's actual profit reaches or exceeds a targeted level. For
additional information regarding the Mid-Term Plans, see "Employment
Arrangements with Executive Officers -- Cash Incentive Plans" below. However, in
light of significant corporate events at each of the Company's principal
business units, the Company is currently evaluating the specific provisions of
the Mid-Term Plans.
The Equity Participation Plan provides senior corporate and business
unit managers and key employees, including the individuals named in the Summary
Compensation Table below, with stock-based incentives. Although the Equity
<PAGE>
Participation Plan is generally designed to provide periodic grants of options
on the Class A Common Stock, it also provides for the use of restricted stock
awards. No restricted stock awards were made in respect of 1996. Overall, the
Equity Participation Plan is intended to provide competitive long-term incentive
opportunities and tie executive long-term financial gain to increases in the
Company's stock price. For additional information regarding the Equity
Participation Plan, see "Employment Arrangements with Executive Officers -- 1993
Equity Participation Plan" below.
Other Executive Compensation. In addition, the Company provides
executive officers with benefits and perquisites such as a 401(k) plan, health
and life insurance benefits and, in certain cases, tax and financial planning
advice. Overall, the Compensation Committee believes the provided levels of
benefits and perquisites are necessary and, in combination with the previously
mentioned compensation elements, facilitate the Company's ability to secure the
needed executive talents.
Adoption of CEO and COO Compensation Arrangements. In April 1993, the
Compensation Committee adopted compensation arrangements with the Company's
Chairman and Chief Executive Officer and President and Chief Operating Officer
that included base salaries of $1 per year and incentive compensation on a
discretionary basis. In addition, at that time, the Compensation Committee
approved for such executives up-front stock option grants.
In April 1994, the Compensation Committee approved, subject to approval
by the stockholders of appropriate amendments to the Equity Participation Plan
(which amendments were approved by Triarc's stockholders on June 9, 1994),
grants for the Chairman and Chief Executive Officer and the President and Chief
Operating Officer of "performance stock options" for an aggregate of 3,500,000
shares of Class A Common Stock. These options were granted in lieu of base
salary, annual performance bonus and long term compensation for a six-year
period commencing April 1993. The options have an exercise price of $20.125 per
share and will vest and become exercisable as follows: if the closing price of a
share of Class A Common Stock is at least approximately 135% of the exercise
price for 20 out of 30 consecutive trading days ending on or prior to March 30,
1999, each such option will vest and become exercisable as to one third of the
shares subject to the option; if the closing price of a share of Class A Common
Stock is at least approximately 180% of the exercise price for 20 out of 30
consecutive trading days ending on or prior to March 30, 2000, each such option
will vest and become exercisable as to one third of the shares subject to the
option; and if the closing price of a share of Class A Common Stock is at least
approximately 225% of the exercise price for 20 out of 30 consecutive trading
days ending on or prior to March 30, 2001, the options will vest and become
exercisable as to one third of the shares subject to the option. In addition to
early vesting in the event such closing price levels are attained, each such
option initially was to vest and become exercisable after 14 years and 6 months
even if Class A Common Stock did not so appreciate and to have a term of 15
years from the date of grant. In March 1995, in order to meet certain
requirements of the Securities and Exchange Commission necessary to obtain
favorable accounting treatment with respect to the performance stock options,
the Compensation Committee and the Board of Directors each unanimously approved
(with Messrs. Peltz and May, abstaining) amendments to the performance stock
options granted to Messrs. Peltz and May, which amendments provided that (a)
such options will vest in 9 years and 6 months, rather than 14 years and 6
months, if the closing price levels described above are not obtained and (b)
such options will have a term of 10 years, rather than 15 years, from the date
of grant. Additionally, the performance stock options that are exercisable
immediately prior to termination of the optionee's employment remain exercisable
after termination of the optionee's employment during the period of 90 days
immediately following such termination, except upon termination for cause. Upon
the optionee's death or permanent disability while employed by Triarc or upon
the optionee's death during the 90 days following the optionee's termination of
employment, the option becomes fully exercisable and, in the case of the
optionee's death, remains exercisable until the earlier of one year after the
optionee's death or the expiration of the option. 350,000 "performance stock
options" granted to Leon Kalvaria, the former Vice Chairman of Triarc, in April
1994 (which were identical to those granted to Messrs. Peltz and May) were
canceled in January 1997.
<PAGE>
Consistent with the discussion above, the Chairman and Chief Executive
Officer and the President and Chief Operating Officer each received a base
salary of $1 during 1996 and stock option grants (which are set forth in the
Summary Compensation Table), and did not receive any annual incentive bonuses.
As noted above, in light of their contributions to the successful completion of
the monetization of certain of the Company's businesses, special bonuses were
awarded in August 1996 to the Chairman and Chief Executive Officer and the
President and Chief Operating Officer. Such bonuses are included in the Summary
Compensation Table below. The factors considered in determining the size of such
stock option awards to Messrs. Peltz and May were the stock option guidelines
established for all participants in the Equity Participation Plan as well as
Messrs. Peltz's and May's respective performance and contribution to the
Company. The Committee remains committed to its notion that such up-front grants
of stock options as performance stock options provide a meaningful and
compelling incentive to the Chairman and Chief Executive Officer and the
President and Chief Operating Officer to take actions that result in increases
in stockholder value.
The Omnibus Budget Reconciliation Act of 1993 (the "Tax Act") includes a
provision which may preclude a publicly held corporation from deducting annual
compensation in excess of $1,000,000 paid to certain of its highly compensated
officers. There are, however, exceptions under the Tax Act for qualified
performance based compensation (including stock options and SARs) if certain
conditions are met. Although the Company intended that the "performance stock
options" granted to the Chairman and Chief Executive Officer and the President
and Chief Operating Officer satisfy these conditions, there can be no assurance
that they do satisfy such conditions. The Committee is convinced that the
performance incentive provided by the performance stock options is in the
stockholders' best interest, irrespective of their treatment under the Tax Act.
Adoption of Mid-Term Plans. The Compensation Committee approved the
implementation of the Mid-Term Plans which is intended to focus the efforts of
the management of each of the Company's principal business units on sustained
profitability. The Mid-Term Plans developed for the Company's principal business
units provide for awards out of an incentive pool created for each of the
principal business units based upon the amount by which a unit's actual profit
reaches or exceeds a pre-determined level over a three year cycle (and in the
case of Mistic, a five year cycle). As noted above, the Company is currently
evaluating the specific provisions of the Mid-Term Plans.
The Compensation Committee believes the Mid-Term Plans provide an
important component of incentive compensation by highlighting longer-term
performance of each business unit. With relatively autonomous units in diverse
businesses, linking a portion of variable pay to business unit results will hold
senior unit managers accountable for sustained unit profitability. A manager's
participation in a Mid-Term Plan is complemented, as appropriate, by
participation in the Equity Participation Plan. Taken together, these two forms
of long-term incentives provide business unit managers with vested interests in
maximizing their unit's longer-term profitability.
Grant of Equity-based Incentives. Since the Compensation Committee
determined that it was in the best interest of stockholders to provide
significant equity incentives to the Company's management team, the Compensation
Committee approved stock option grants in respect of 1996 performance to
selected corporate and business unit managers. Historically, the Compensation
Committee has awarded stock options in December of each year. However, with
regard to 1996 no options were granted until March 1997. In recognition of the
fact that in December 1996 the daily closing price of Triarc's Class A Common
Stock ranged from $11.375 and $12.375 (and was $11.50 on December 31, 1996) and
that the closing price of Triarc's Common Stock on March 20, 1997 (the date on
which option grants were made) was $14.75, the Compensation Committee determined
that, in order to further incentivize the executive officers of Triarc to
continue their performance, the exercise price of such grants should be 85% of
the closing price of Triarc's Class A Common Stock on the date of grant, or
$12.54. In addition, in order to further tie the overall compensation of certain
senior executive officers of the Company to the performance of the Company and
to further incentivize them, certain senior executive officers (including
certain of those officers in the Summary Compensation Table), other than the
Chairman and Chief Executive Officer and President and Chief Operating Officer,
were given the choice to receive
<PAGE>
additional stock options instead of cash bonuses that might otherwise have been
granted to them. These stock options will vest one-third per year on each of the
first, second and third anniversaries of the date of grant and will expire on
the tenth anniversary of the date of grant. Such options are included in the
Summary Compensation Table below.
In addition, certain executive officers of the Company, are expected to
participate in the National Propane Corporation 1996 Unit Option Plan. Under
such plan such executive officers will be eligible to receive grants of options
to purchase common or subordinated units of the Partnership and unit
appreciation rights ("UARs"). No such unit options or UARs were granted with
respect to 1996.
Summary. The Compensation Committee believes the Executive Compensation
Program, through the Compensation Committee's administration of the elements of
the Program, will ensure the Company's ability to retain, motivate and attract
the executive resources required to maximize stockholder returns. The Company's
competitive pay philosophy facilitates the employment of talented executives.
The emphasis on variable pay and the direct link to both short-and long-term
results, as well as financial and stock performance, links this competitive pay
to critical measures of Company performance. In combination, all these elements
act in the best interests of the Company's stockholders.
The Compensation Committee
Gerald Tsai, Jr., Chairman
Clive Chajet
David E. Schwab II
Raymond S. Troubh
INTRODUCTION TO SUMMARY COMPENSATION TABLE
The Summary Compensation Table sets forth salary of, cash bonus awards
as well as non-cash awards granted under the Equity Participation Plan with
respect to the year ended December 31, 1994, the year ended December 31, 1995
and the year ended December 31, 1996 to Triarc's Chairman and Chief Executive
Officer, President and Chief Operating Officer and to three of the other
executive officers of Triarc who constituted Triarc's most highly compensated
executive officers during 1996.
Messrs. Peltz and May serve as directors and officers of Triarc and
several of its subsidiaries, and Messrs. Schorr, Cohlan and Kogan serve as
officers of Triarc and several of its subsidiaries. All compensation set forth
in the Summary Compensation Table for Messrs. Peltz, May, Schorr, Cohlan and
Kogan was paid by Triarc and represents amounts paid for services rendered to
Triarc and its subsidiaries. All non-cash awards granted to any Named Officer
were made by Triarc. Additional information with respect to the compensation
arrangements for the Chairman and Chief Executive Officer and the Named Officers
is set forth below under "Certain Employment Arrangements with Executive
Officers."
<PAGE>
SUMMARY COMPENSATION TABLE
ANNUAL COMPENSATION
--------------------------------------------
OTHER ANNUAL
NAME AND PRINCIPAL POSITION PERIOD SALARY($) BONUS($) COMPENSATION($)
- -------------------------------- ------- -------- ----------- ---------------
Nelson Peltz .................. 1996 1 2,000,000(1) 339,490 (12)
Chairman and Chief Executive 1995 1 -- 839,923 (9)
Officer of Triarc 1994 1 -- 913,406 (4)
Peter W. May ................. 1996 1 1,000,000(1) 164,469 (13)
President and Chief Operating 1995 1 -- 53,310 (10)
Officer of Triarc 1994 1 -- 97,019 (5)
Brian L. Schorr ............... 1996 312,500 450,000(8) (6)
Executive Vice President and 1995 312,500 275,000 (6)
General Counsel of Triarc 1994 237,404 538,000(11) (6)
John L. Cohlan ............... 1996 250,000 575,000(8) (6)
Senior Vice President -- 1995 250,000 265,000 (6)
Corporate Finance of Triarc 1994 250,000 300,000 (6)
Eric D. Kogan................. 1996 250,000 450,000(8) (6)
Senior Vice President -- 1995 100,000 300,000 (6)
Corporate Development of Triarc 1994 100,000 300,000 (6)
<PAGE>
LONG TERM COMPENSATION
--------------------------------------------
AWARDS PAYOUTS
---------------- -------
RESTRICTED SECURITIES
STOCK UNDERLYING LTIP
NAME AND AWARDS(S) OPTIONS/SARS PAYOUTS ALL OTHER
PRINCIPAL POSITION ($)(3) (#)(3) ($)(3) COMPENSATION($)
- -------------------- ---------- ------------ ------- --------------
Nelson Peltz......... -- 175,000 -- --
Chairman and Chief -- 150,000 -- --
Executive Officer -- 2,340,000 (2) -- --
of Triarc
Peter W. May ........ -- 125,000 -- --
President and Chief -- 100,000 -- --
Operating Officer -- 1,560,000 (2) -- --
of Triarc
Brian L. Schorr ..... -- 120,000 57,500 7,115(7)
Executive Vice President -- 30,000 -- 4,188(7)
and General Counsel 78,750 95,000 -- --
of Triarc
John L. Cohlan ...... -- 50,000 143,750 5,250(14)
Senior Vice President -- -- 25,000 -- 5,250(14)
Corporate Finance of Triarc -- 18,000 -- 3,710(14)
Eric D. Kogan........ -- 150,000 69,000 5,250(14)
Senior Vice President -- -- 30,000 -- 4,067(14)
Corporate Development -- 14,000 -- 3,375(14)
of Triarc
- -----
(1) Represents special bonuses paid to Messrs. Peltz and May in connection
with the completion of certain transactions. One-half of Mr. Peltz'
bonus was paid in August 1996 and one-half was paid in March 1997.
(2) Of these amounts, options to acquire 2,100,000 and 1,400,000 shares of
Class A Common Stock, respectively, for Messrs. Peltz and May are
performance based stock options granted to Messrs. Peltz and May in lieu
of base salary, annual performance bonus and long-term compensation for
a six-year period commencing April 1993. See "Certain Employment
Arrangements with Executive Officers -- Nelson Peltz and Peter W. May"
below.
(3) 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 --
1993 Equity Participation Plan" below. The value of the restricted stock
awards is based upon the closing price of Class A Common Stock on the
New York Stock Exchange ("NYSE") on the date of grant. Based upon the
closing price of Class A Common Stock on the NYSE on December 31, 1996
(the last trading day of 1996) of $11.50, the number and value (the
"LTIP Payout" amount set forth in the Summary Compensation Table) of the
aggregate restricted stock holdings of the Named Officers were as
follows: Mr. Schorr--5,000 shares with a value of $57,500; Mr.
Cohlan--12,500 shares with a value of $143,750; and Mr. Kogan--6,000
shares with a value of $69,000. On January 16, 1996, the restrictions on
all previously granted restricted stock awards lapsed. Holders of
restricted shares are entitled to receive any dividends attributable to
such shares. The exercise price of the options granted in respect of
1996 (which were granted on March 20, 1997), is $12.54 (85% of the
closing price
<PAGE>
of Triarc's Class A Common Stock on the date of grant). Such options
are discussed above in the "Report of the Compensation Committee."
(4) Includes relocation costs of $736,872 and $176,534 for charges relating
to use of corporate aircraft.
(5) Represents charges relating to use of corporate aircraft.
(6) Perquisites and other personal benefits did not exceed the lesser of
either $50,000 or 10% of the total annual salary and bonus reported
under the headings of "Salary" and "Bonus."
(7) Includes $3,128 contributed to 401(k) plan by Triarc on behalf of Mr.
Schorr in each of 1995 and 1996 and $1,060 and $3,987 of other
compensation paid by Triarc in an amount equal to premiums for term life
insurance in 1995 and 1996, respectively.
(8) Includes special bonuses paid to each of Messrs. Schorr, Cohlan and
Kogan in connection with the completion of certain transactions. In
March 1997, Messrs. Schorr and Kogan chose to receive additional stock
options instead of cash bonuses that might otherwise have been granted
to them. Such stock options are included under the heading "Long Term
Compensation - Securities Underlying Options/SARs."
(9) Includes relocation costs of $785,000 and fees paid by Triarc on behalf
of Mr. Peltz for tax and financial planning services.
(10) Includes fees of $40,000 paid by Triarc on behalf of Mr. May for tax and
financial planning services.
(11) Includes one-time sign-on bonus consisting of $250,000 in cash and 5,000
shares of restricted stock and an additional $38,000 to reimburse Mr.
Schorr for certain costs incurred in connection with his leaving his
previous position.
(12) Includes charges of $225,668 relating to use of corporate aircraft.
(13) Includes charges of $98,729 relating to use of corporate aircraft.
(14) Represents amounts contributed to 401(k) plan by Triarc on behalf of the
Named Officer.
CERTAIN EMPLOYMENT ARRANGEMENTS WITH EXECUTIVE OFFICERS
Nelson Peltz and Peter W. May. Since the Change in Control, 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. Also, Messrs. Peltz and May were granted
certain "performance options" in April 1994 and certain special bonuses in
August 1996. See "Report of the Compensation Committee -- Adoption of CEO and
COO Compensation Arrangements" above.
Brian L. Schorr. On June 29, 1994, Triarc and Brian L. Schorr entered
into an employment agreement (the "Schorr Employment Agreement"), providing for
employment of Brian L. Schorr as Executive Vice President and General Counsel of
Triarc having an initial term which expires on June 28, 2000, unless not later
than June 29, 1998
<PAGE>
either party notifies the other that it does not wish to have the term extended
beyond June 28, 2000. The Schorr Employment Agreement provides for an annual
base salary of $312,500, which is subject to increase, but not decrease. Mr.
Schorr is also eligible to receive annual incentive bonuses. The Schorr
Employment Agreement also provides that if Mr. Schorr dies during the term of
the Agreement, his legal representative will be entitled to receive an amount
calculated at an annual rate equal to the sum of (i) Mr. Schorr's then current
base salary plus (ii) $250,000 (such aggregate amount is collectively referred
to as the "Base Amount") for the remaining term of the agreement, if Triarc is
able to procure, at a reasonable rate, term insurance on Mr. Schorr's life to
pay such obligation, or if Triarc is not able to procure such insurance, an
amount calculated at the annual rate of the Base Amount for the three-month
period following Mr. Schorr's death. Triarc obtained such insurance to fund this
obligation at an annual premium of approximately $3,000. Triarc has transferred
ownership of such insurance policy to a trust established by Mr. Schorr and Mr.
Schorr has, under certain circumstances, given up his right to have Triarc pay
the Base Amount after his death. Pursuant to the Schorr Employment Agreement, if
Mr. Schorr's employment terminates for any reason other than cause (as defined
in the Schorr Employment Agreement), options and restricted stock awards
previously granted to Mr. Schorr will immediately vest in their entirety and
remain exercisable for a period of one year following the date of such
termination. The Schorr Employment Agreement also provides that if Triarc
terminates Mr. Schorr's employment without cause, Mr. Schorr will receive a lump
sum payment (discounted to present value) in an amount equal to (i) all base
salary amounts due for the year of termination and for each remaining year of
the Schorr Employment plus (ii) an amount equal to the number of years to the
end of the Schorr Employment Agreement multiplied by $250,000. The Schorr
Employment Agreement further provides that at the option of Mr. Schorr, the
Schorr Employment Agreement shall be deemed to have been terminated by Triarc
without cause following a change in control. A "change in control" is defined to
mean: (i) the acquisition by any person of more than 50% of the combined voting
power of the outstanding securities entitled to vote generally in the election
of directors of Triarc, followed by, without the prior consent of Mr. Schorr,
any meaningful diminution in his duties or authority; (ii) a majority of the
Board of Directors of Triarc being individuals who are not nominated by the
Board of Directors of Triarc, followed by, without the prior consent of Mr.
Schorr, any meaningful diminution in his duties or authority; (iii) neither Mr.
Peltz nor Mr. May being Chairman and Chief Executive Officer and President and
Chief Operating Officer, respectively, of Triarc; or (iv) Mr. Schorr reporting
to someone other than either Mr. Peltz or Mr. May. The acquisition or ownership
of any portion of the combined voting power of Triarc by DWG Acquisition, Nelson
Peltz or Peter W. May or by any person affiliated with such persons, or the
merger, consolidation or sale of assets of Triarc or any subsidiary of Triarc
with or to any corporation or entity controlled by DWG Acquisition, Nelson Peltz
or Peter W. May or any person affiliated with such persons, does not constitute
a change in control.
CASH INCENTIVE PLANS
Triarc has developed annual cash incentive plans (each, an "Annual
Incentive Plan") and mid-term cash incentive plans (each, a "Mid-Term Incentive
Plan") for executive officers and key employees of each of Royal Crown, Mistic,
Arby's and National Propane. As noted above, in light of certain significant
corporate events, the Company is evaluating the specific provisions of the
Mid-Term Plans.
Each Annual Incentive Plan is designed to provide annual incentive
awards to participants, 50% of which are based on whether the applicable company
has met certain pre-determined goals and 50% of which is based on the
performance of the participant during the preceding year. Under each Annual
Incentive Plan, participants may receive awards of a specified percentage of
their then current base salaries, which percentage varies depending upon the
level of seniority and responsibility of the participant. Such percentage is set
by the company's management in consultation with management of Triarc. The board
of directors of each company, in consultation with management of Triarc and the
Compensation Committee of the Triarc Board of Directors, may elect to adjust
awards on a discretionary basis to reflect the relative individual contribution
of the executive or key employee, to evaluate the "quality" of the company's
earnings or to take into account external factors that affect performance
results. The board of directors of each company may also
<PAGE>
decide that multiple performance objectives related to the company's and/or the
individual's performance may be appropriate and in such event, such factors
would be weighted in order to determine the amount of the annual incentive
awards. Each Annual Incentive Plan is administered by the respective company's
board of directors and Triarc's management and may be amended or terminated by
such board of directors and Triarc's management at any time.
Under each Mid-Term Incentive Plan, incentive awards are granted to
participants if the applicable company achieves an agreed upon profit over a
three year performance cycle (in the case of Mistic, profit is measured over a
five year performance cycle). During each plan year, an amount is accrued for
each participant based upon the amount by which the relevant company's profit
for such year exceeds a certain minimum return. A new three-year performance
cycle (and, in the case of Mistic, a new five year performance cycle) begins
each year, such that after the third year (and, in the case of Mistic, after the
fifth year) the annual cash amount paid to participants pursuant to the relevant
Mid-Term Incentive Plan should equal the target award if their respective
company's profit goals have been achieved for the full three-year cycle (and, in
the case of Mistic, the full five year cycle). Except as set forth in the
Employment Agreements, the board of directors of each company, together with
Triarc's management and the Compensation Committee of Triarc's Board of
Directors, may adjust, upward or downward, an individual's award based upon an
assessment of the individual's relative contribution to the company's
longer-term profit performance. The board of directors and Triarc's management
may amend or terminate the Mid-Term Incentive Plan for such company at any time.
As noted above, the Company is currently evaluating the specific provisions of
the Mid-Term Plans.
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.
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 stockholders on October 27, 1993. The Equity Participation Plan was
also amended on April 19, 1994, with further amendments which were approved by
Triarc's stockholders on June 9, 1994 and on June 8, 1995. In addition, the
Equity Participation Plan was amended by the Triarc Board during 1995, 1996 and
1997, which amendments did not require stockholder approval. It expires by its
terms on April 24, 1998. The plan provides for the grant of options to purchase
Class A Common Stock (including performance stock options, which are described
in "Report of the Compensation Committee -- Adoption of CEO and COO Compensation
Arrangements" above), SARs, restricted shares of Class A Common Stock and, to
non-employee directors of Triarc, at their option, shares of Class A Common
Stock in lieu of annual retainer fees and/or Board of Directors or committee
meeting attendance fees that would otherwise be payable in cash. Directors,
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.
On April 23, 1993 and on March 1, 1994, each of Messrs. Cohlan and Kogan
received restricted shares of Class A Common Stock, which shares were granted in
respect of their respective performance during the eight month transition period
ending December 31, 1993 and to incentivize their future performance (each, an
"RSA"). In addition, on July 26, 1994, Mr. Schorr received restricted shares
(the "Schorr RSA") of Class A Common Stock in connection with the Schorr
Employment Agreement and to incentivize his future performance. The Schorr RSA
is set forth in the Summary Compensation Table above. All of the RSAs and the
Schorr RSA vested on January 16, 1996. In January 1996, Triarc made loans to Mr.
Cohlan and Mr. Kogan in the amount of $67,549 and $34,497, respectively, to be
used to make tax payments by them upon the vesting of their RSAs. Such loans
bore interest at an annual rate equal to the prime rate of interest and were
secured by the shares with respect to which the tax was owed. Such loans were
repaid on May 21,
<PAGE>
1996. In connection with the sale of substantially all of the textile assets of
Graniteville Company, the Compensation Committee of the Triarc Board determined
that effective as of the closing of such sale, each of the stock options
previously granted to certain employees of Graniteville Company which had not
vested as of such date would vest in their entirety and all such stock options
remained exercisable until December 31, 1996.
MISCELLANEOUS
Mistic has granted to Mr. Weinstein a stock appreciation right
("Weinstein SAR") with respect to 4.85% of the then outstanding shares of
Mistic's common stock plus the equivalent shares represented by the Weinstein
SAR and stock appreciation rights granted to another executive officer of Mistic
and to Mistic's lender. The Weinstein SAR has an appreciation base of $28,636.88
per share and may be exercised at any time after vesting but prior to the tenth
anniversary of the date of grant. One-ninth of the Weinstein SAR vested on each
of January 1, 1996 and January 1, 1997, and an additional one-ninth of the
Weinstein SAR will vest on January 1, 1998. The remaining two-thirds of the
Weinstein SAR will vest over a three year period of time to the extent that
Mistic achieves certain performance targets during such period. The Weinstein
SAR vests immediately and in its entirety in the event of Weinstein's death,
continued illness or the termination of Weinstein's employment by Mistic without
good cause. Furthermore, if a change in control occurs and Triarc has realized
certain specified internal rate of return on the disposition of its equity
investment in Mistic as of the date of such change in control, then the
Weinstein SAR will immediately vest in its entirety. One other executive of
Mistic received a stock appreciation right with respect to 4.85% of the then
outstanding shares of Mistic's common stock plus the equivalent shares
represented by the Weinstein SAR, such other executive's stock appreciation
right and another stock appreciation right granted to Mistic's lender. All of
the terms of such executive's stock appreciation right are virtually identical
to those of the Weinstein SAR. In light of the reorganization of the Triarc
Beverage Group and the proposed acquisition of Snapple, the terms of the
Weinstein SAR and such other executive's stock appreciation right are in the
process of being reviewed.
OPTIONS GRANTED IN 1996
No options to purchase shares of Class A Common Stock were granted to
the Named Officers during 1996 and no stock options were exercised by any Named
Officer during 1996.
OPTION VALUES AT END OF 1996
The following table sets forth certain information concerning the value
at the end of 1996 of unexercised in-the-money options to purchase shares of
Class A Common Stock granted to the Named Officers outstanding as of the end of
1996. No SARs have been granted to any of the Named Officers.
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND FY-END OPTION VALUES
NUMBER OF
SECURITIES
UNDERLYING VALUE OF UNEXERCISED
UNEXERCISED IN-THE-MONEY
OPTIONS AT OPTIONS AT FISCAL
SHARES FISCAL YEAR- YEAR-END 1996
ACQUIRED END 1996 (#) ($)(1)
ON VALUE EXERCISABLE/ EXERCISABLE/
NAME EXERCISE(#) REALIZED($) UNEXERCISABLE UNEXERCISABLE
- ---------------- ------------ ----------- ------------------ ---------------
Nelson Peltz...... -0- -0- 940,000/2,225,000 248,750/137,500
Peter W. May...... -0- -0- 626,667/1,483,333 165,833/ 91,667
Brian L. Schorr... -0- -0- 80,000/ 45,000 28,750/ 27,500
John L. Cohlan.... -0- -0- 67,999/ 25,001 24,958/ 22,917
Eric D. Kogan.... -0- -0- 54,000/ 25,000 24,250/ 27,500
- ---------
(1) On December 31, 1996, the closing price of the Class A Common Stock on the
New York Stock Exchange was $11.50.
<PAGE>
STOCK PRICE PERFORMANCE GRAPH
TRIARC COMPANIES, INC.
COMPARISON OF 5-YEAR CUMULATIVE TOTAL RETURN:
TRIARC VS. S&P 500 & S&P DIVERSIFIED MANUFACTURING
TOTAL RETURN TO SHAREHOLDERS
REINVESTED DIVIDENDS
[PERFORMANCE GRAPH]
Base Years Ending
Period
Company/Index Apr91 Apr92 Apr93 Dec93 Dec94 Dec95 Dec96
- ------------------------------------------------------------------------------
TRIARC COS INC - CLA 100 85.70 179.74 238.07 111.89 104.75 109.51
S&P 500 INDEX 100 134.12 146.51 158.37 160.46 220.76 271.45
S&P MFG (DIV.INDLS) 100 121.05 129.28 150.53 155.82 219.42 302.38
CERTAIN TRANSACTIONS
CERTAIN TRANSACTIONS WITH AFFILIATES
Triarc subleased through January 31, 1996 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. Subsequent thereto, and
through December 31, 1996, the Company subleased the same office facility from
an unaffiliated third party. In addition, commencing May 1993 until October
1993, Triarc also sublet 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 landlord. Subsequent to October 1993, Triarc assumed
the lease for approximately 17,000 square feet of the office space in West Palm
Beach which expires in February 2000. The sublease for the other approximate
15,000 square feet in West Palm Beach expired in September 1994. The aggregate
amounts paid by Triarc during Fiscal 1994, Fiscal 1995 and 1996 with respect to
affiliates of Messrs. Peltz and May for such subleases, including operating
expenses, but net of amounts received by Triarc for sublease of a portion of
such space (see below -- $358,000, $357,000 and $30,000, respectively) were
$1,620,000, $1,350,000, and $1,100,000, respectively, which are less than the
aggregate amounts such affiliates paid to the unaffiliated landlords but
represent amounts Triarc believes it would pay to an unaffiliated third party
for similar improved office space. Messrs. Peltz and May have guaranteed to the
unaffiliated landlords the payment of rent for the 17,000 square feet of office
space in West Palm Beach. In June 1994, Triarc decided to centralize its
corporate offices in New York City. In connection therewith, Triarc subleased
the remaining 17,000 square feet in West Palm Beach to an unaffiliated third
party in August 1994. Mr. May has an equity interest in a franchisee that
operates an Arby's restaurant in New Milford, CT. That franchisee is a party to
Arby's standard franchise license agreement and pursuant thereto pays to Arby's
fees and royalty payments that unaffiliated third-party franchisees pay.
The Company uses aircraft owned by Triangle Aircraft Services
Corporation ("TASCO"), a company owned by Messrs. Peltz and May. On October 1,
1993 the Company began leasing the aircraft from TASCO for an annual rent of
$2,200,000 plus indexed cost of living adjustments. Effective October 1, 1994
the original rent was reduced $400,000 reflecting the termination of the lease
for one of the aircraft which was sold. In connection with the sale of the
aircraft the Company paid $130,000 of related costs on behalf of TASCO. In
connection with such lease the Company had rent expense of $2,100,000,
$1,910,000 and $1,973,000 for 1994, 1995, and 1996, respectively. Pursuant to
the lease, the Company also pays the operating expenses of the aircraft directly
to third parties.
PROPOSAL 2.
APPROVAL OF AMENDMENT TO THE CERTIFICATE OF INCORPORATION
TO CHANGE THE MINIMUM AND MAXIMUM NUMBER OF DIRECTORS
INTRODUCTION
Section 2 of Article V of the Certificate of Incorporation of the
Company provides that the number of Directors shall be not less than ten or more
than twenty, with the exact number to be fixed by the Board of Directors
pursuant to a resolution adopted by a majority of directors then in office.
The Board of Directors unanimously recommends that the stockholders of
the Company authorize an amendment of the first sentence of Section 2 of Article
V of the Company's Certificate of Incorporation to change the minimum required
number of directors to seven (7) and the maximum number of directors to fifteen
(15), with the exact number of Directors within that range to be fixed pursuant
to a resolution approved by a majority of the members of the Board of Directors
then in office. The Board of Directors has approved a corresponding amendment to
the Company's By-laws
<PAGE>
which will become effective if the proposed amendment to the Certificate of
Incorporation is approved by the Company's stockholders.
The proposed amendment is being submitted to the stockholders in light
of Mr. Lowenkron's decision not to stand for reelection to the Board of
Directors (see Proposal (1) above) and in recognition of the Board of Directors'
judgement that a smaller board could be more decisive and effective than a
larger board. The Board of Directors believes that this is consistent with the
trend in publicly held corporations, which has been toward somewhat smaller than
larger boards. The Company believes that flexibility is important since outside
directors are increasingly becoming more likely to limit the number of Boards of
Directors on which they are willing to serve. The Board of Directors has also
determined that the provisions in the Certificate of Incorporation and By-laws
should be consistent.
PROPOSED AMENDMENT
The first sentence of Section 2 of Article V of the Company's
Certificate of Incorporation would be amended to read as follows (deletions are
indicated by brackets and additions by boldface italic type):
"The Board of Directors shall consist of not less than SEVEN (7) [ten
(10)] nor more than FIFTEEN (15) [twenty (20)] persons, the exact number
to be fixed from time to time by the Board of Directors pursuant to a
resolution adopted by a majority of directors then in office; provided,
however, that such maximum number may be increased from time to time to
reflect the rights of holders of Preferred Stock to elect directors in
accordance with the terms of the Certificate of Incorporation or of the
Certificate of Designation pursuant to which any class or series of
Preferred Stock is issued or to the extent provided in any resolution or
resolutions adopted by the Board of Directors providing for the issuance
of any class or series of Preferred Stock pursuant to Article IV of this
Certificate of Incorporation."
REQUIRED VOTE
Approval of the proposed amendment will require the affirmative vote of
a majority of the voting power present (in person or by proxy) and entitled to
vote at the Meeting. In the event that the Company's stockholders fail to
approve the amendment, the Board of Directors will, subsequent to the Meeting,
fill the vacancy on the Board of Directors created by Mr. Lowenkron's decision
not to stand for reelection.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE APPROVAL OF THE AMENDMENT TO
THE CERTIFICATE OF INCORPORATION TO CHANGE THE MINIMUM AND MAXIMUM NUMBER OF
DIRECTORS.
<PAGE>
PROPOSAL 3.
RATIFICATION OF APPOINTMENT OF INDEPENDENT
CERTIFIED PUBLIC ACCOUNTANTS
INTRODUCTION
The Board of Directors has selected Deloitte & Touche LLP ("Deloitte")
to be the Company's independent certified public accountants for 1997. Deloitte
has acted as the Company's independent certified public accountants since June
9, 1994.
Representatives of Deloitte will be present at the Meeting with the
opportunity to make a statement if they desire to do so and will be available to
respond to appropriate questions.
REQUIRED VOTE
Ratification of the appointment of the independent certified public
accountant requires the affirmative vote of a majority in voting power present
(in person or by proxy) and entitled to vote at the Meeting. In the event that
the Company's stockholders fail to ratify the appointment of Deloitte, the
selection of the Company's independent certified public accountants will be
submitted to the Company's Board of Directors for reconsideration.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE RATIFICATION OF
APPOINTMENT OF DELOITTE & TOUCHE LLP AS THE COMPANY'S INDEPENDENT CERTIFIED
PUBLIC ACCOUNTANTS.
OTHER MATTERS
EXPENSES OF SOLICITATION
The cost of soliciting proxies will be borne by the Company. In addition
to the solicitation of proxies by use of the mails, some of the officers,
directors and regular employees of the Company and its subsidiaries, none of
whom will receive additional compensation therefor, may solicit proxies in
person or by telephone, telegraph or other means. Solicitation will also be made
by employees of Georgeson & Company, which firm will be paid a fee of $8,000,
plus expenses. As is customary, the Company will, upon request, reimburse
brokerage firms, banks, trustees, nominees and other persons for their
out-of-pocket expenses in forwarding proxy materials to their principals.
STOCKHOLDER PROPOSALS FOR THE 1998 ANNUAL MEETING
From time to time, stockholders present proposals which may be proper
subjects for inclusion in the proxy statement and for consideration at the
Annual Meeting. To be considered, proposals must be submitted on a timely basis.
Proposals for the 1998 Annual Meeting must be received by the Company no later
than January 13, 1998, and must otherwise comply with Rule 14a-8 under the
Securities Exchange Act of 1934, as amended (the "Exchange Act").
Triarc's Certificate of Incorporation currently imposes certain
additional procedural requirements for submitting stockholder proposals to
meetings of stockholders. Any such proposals must be specified in a written
notice given by or on behalf of a stockholder of record on the record date for
such meeting entitled to vote thereat or a duly authorized proxy for such
stockholder, in accordance with all of the following requirements. Such notice
must be delivered personally to, or mailed to and received at, the principal
executive office of the Company addressed to the attention of
<PAGE>
the Secretary, not less than 45 days nor more than 60 days prior to the meeting;
provided, however, that in the event that less than 55 days' notice or prior
public disclosure of the date of the meeting is given or made to stockholders,
notice by the stockholder to be timely must be so received not later than the
close of business on the 10th day following the day on which such notice of the
date of the annual or special meeting was mailed or such public disclosure was
made, whichever first occurs. Such notice must set forth (i) a full description
of each such item of business proposed to be brought before the meeting and the
reasons for conducting such business at such meeting, (ii) the name and address
of the person proposing to bring such business before the meeting, (iii) the
class and number of shares held of record, held beneficially and represented by
proxy by such person as of the record date for the meeting (if such date has
then been made publicly available) and as of the date of such notice, (iv) if
any item of such business involves a nomination for director, all information
regarding each such nominee that would be required to be set forth in a
definitive proxy statement filed with the SEC pursuant to Section 14 of the
Exchange Act, or any successor thereto, and the written consent of each such
nominee to serve if elected, (v) any material interest of the stockholder in
such item of business and (vi) all other information that would be required to
be filed with the SEC if, with respect to the business proposed to be brought
before the meeting, the person proposing such business was a participant in a
solicitation subject to Section 14 of the Exchange Act, or any successor
thereto. The Company may require a proposed nominee for director to furnish such
other information as may be required to be set forth in a stockholder's notice
of nomination which pertains to the nominee or which may be reasonably required
to determine the eligibility of such proposed nominee to serve as a director of
the Company. At the request of the Board of Directors, any individual nominated
by the Board of Directors for election as a director shall furnish to the
Secretary of the Company that information required to be set forth in a
stockholder's notice of nomination which pertains to a nominee. The Nominating
Committee has adopted certain rules with respect to nominations for Board
membership. See "Proposal 1. Election of Directors -- Board Meetings and Certain
Committees of the Board -- Nominating Committee" above. The Chairman of the
meeting may, if the facts warrant, determine that a nomination or stockholder
proposal was not made in accordance with the foregoing procedure, and if he
should so determine, he shall so declare to the meeting and the defective
nomination or proposal shall be disregarded. Any questions relating to
stockholder proposals should be submitted in writing to the Secretary of the
Company, at 280 Park Avenue, New York, New York 10017.
INFORMATION INCORPORATED BY REFERENCE
The Company hereby incorporates by reference into this Proxy Statement
"Item 7. Management's Discussion and Analysis of Financial Condition and Results
of Operations" of the 10-K, a copy of which is being provided to stockholders
along with this Proxy Statement.
By Order of the Board of Directors
STUART I. ROSEN
Secretary
New York, New York
May 9, 1997
<PAGE>
TRIARC COMPANIES, INC.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints Nelson Peltz and Peter W. May and each of them,
with power of substitution, attorneys and proxies to represent and to vote all
shares of Class A Common Stock of Triarc Companies, Inc. (the "Company") which
the undersigned is entitled to vote at the Annual Meeting of Stockholders of
Triarc Companies, Inc. to be held on Wednesday, June 4, 1997, at 11:00 A.M.,
local time, in the third floor auditorium of The Chase Manhattan Bank, 270 Park
Avenue, New York, New York, and at any adjournments or postponements thereof:
1. Election of FOR all nominees AUTHORITY WITHHELD to vote for
Directors: listed below all nominees listed below [ ]
(except as otherwise
instructed below) []
Nelson Peltz, Peter W. May, Hugh L. Carey, Clive Chajet, Stanley R. Jaffe,
Joseph A. Levato, David E. Schwab II, Raymond S. Troubh and Gerald Tsai, Jr.
To withhold authority to vote for any nominee, write that nominee's name
in space below:
2. Proposal to approve an amendment to the Company's Certificate of
Incorporation, as described in the Proxy Statement.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
3. Proposal to ratify the appointment of Deloitte & Touche LLP as the
Company's independent certified public accountants, as described in the
Proxy Statement.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE ELECTION OF THE NOMINEES NAMED
ABOVE AND FOR PROPOSALS 2 AND 3. THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED
IN THE MANNER DIRECTED HEREIN BY THE UNDERSIGNED STOCKHOLDER. IF NO DIRECTION IS
MADE, THIS PROXY WILL BE VOTED FOR THE ELECTION OF THE NOMINEES NAMED ABOVE AND
FOR PROPOSALS 2 AND 3. UNDER THE COMPANY'S BY-LAWS, BUSINESS TRANSACTED AT THE
ANNUAL MEETING OF STOCKHOLDERS IS CONFINED TO THE PURPOSES STATED IN THE NOTICE
OF THE MEETING. THIS PROXY WILL, HOWEVER, CONVEY DISCRETIONARY AUTHORITY TO THE
PERSONS NAMED HEREIN AS PROXIES TO VOTE ON MATTERS INCIDENT TO THE CONDUCT OF
THE MEETING.
Dated: .................................. , 1997
Signature(s).......................................................
.......................................................
This Proxy should bear your signature(s) exactly as
your name(s) appear in the stencil to the left.
When signing as attorney, executor, administrator,
personal representative, trustee, guardian or
corporate officer, please give full title.
For joint accounts, each joint owner should sign.
PLEASE DATE, SIGN AND RETURN TODAY IN THE ENCLOSED ENVELOPE.
<PAGE>
