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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K/A
(Amendment No. 1)
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported) October 25, 2000
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TRIARC COMPANIES, INC.
----------------------
(Exact Name of Registrant as Specified in its Charter)
Delaware 1-2207 38-0471180
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(State or other (Commission (IRS Employer
jurisdiction of File Number) Identification No.)
incorporation)
280 Park Avenue, New York, New York 10017
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(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code (212) 451-3000
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(Former Name or Former Address, if Changed Since Last Report)
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<PAGE>
This Form 8-K/A of Triarc Companies, Inc. ("Triarc" and, collectively
with its subsidiaries, the "Company") constitutes Amendment No. 1 to Triarc's
Current Report on Form 8-K (the "Original Form 8-K") which was filed with the
Securities and Exchange Commision (the "SEC") on November 9, 2000. This
amendment includes Item 7(b), Pro Forma Financial Information, in its entirety
although the only changes from the Original Form 8-K are to (1) note (h) to the
unaudited pro forma condensed consolidated balance sheet as of July 2, 2000 and
(2) the unaudited pro forma condensed consolidated statements of operations for
the year ended January 2, 2000 and the six months ended July 2, 2000 and notes
(a) and (c) thereto. The pro forma adjustment (c) to interest expense has been
corrected to properly reflect interest allocated to the discontinued operations
in the historical financial statements of such entity in the condensed
consolidated statement of operations for the year ended January 2, 2000 and pro
forma adjustments (d) and (a), respectively, to the provision for income taxes
have been corrected (1) for the effect of the correction to interest expense in
the condensed consolidated statement of operations for the year ended January 2,
2000 and (2) for the proper allocation between continuing operations and
discontinued operations for the six months ended July 2, 2000.
Item 7. Financial Statements and Exhibits.
(b) Pro Forma Financial Information
PRO FORMA CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
The following unaudited pro forma (i) condensed consolidated balance
sheet of the Company as of July 2, 2000 and (ii) condensed consolidated
statements of operations of the Company for the year ended January 2, 2000 and
the six months ended July 2, 2000 have been prepared by adjusting such financial
statements, as derived from (i) the audited consolidated financial statements in
Triarc's Annual Report on Form 10-K for the fiscal year ended January 2, 2000
(the "Triarc Form 10-K") and (ii) the unaudited condensed consolidated financial
statements in Triarc's Quarterly Report on Form 10-Q for the fiscal quarter
ended July 2, 2000 (the "Triarc Form 10-Q"). Such adjustments are to reflect the
sale of Snapple Beverage Group (the Company's premium beverage business) and
Royal Crown (the Company's soft drink concentrate business) on October 25, 2000
and the related repayment by the Company of certain debt or assumption by the
Purchaser of certain debt, as if such transactions had occurred as of July 2,
2000 for the condensed consolidated balance sheet and as of January 4, 1999 for
the condensed consolidated statements of operations. Such pro forma adjustments
are described in the accompanying notes to the pro forma condensed consolidated
balance sheet and statements of operations which should be read in conjunction
with such statements. The unaudited pro forma condensed consolidated financial
statements also should be read in conjunction with (i) the Company's audited
consolidated financial statements and management's discussion and analysis of
financial condition and results of operations appearing in the Triarc Form 10-K
and (ii) the Company's unaudited condensed consolidated financial statements and
management's discussion and analysis of financial condition and results of
operations appearing in the Triarc Form 10-Q. The unaudited pro forma condensed
consolidated financial statements do not purport to be indicative of the actual
financial position or results of operations of the Company had the sale of
Snapple Beverage Group and Royal Crown and the related repayment or assumption
of certain debt actually been consummated on July 2, 2000 and January 4, 1999,
respectively, or of the future financial position or results of operations of
the Company.
<PAGE>
<TABLE>
<CAPTION>
Triarc Companies, Inc. and Subsidiaries
Unaudited Pro Forma Condensed Consolidated Balance Sheet
July 2, 2000
As Pro Forma
Reported Adjustments Pro Forma
-------- ----------- ---------
(In thousands)
ASSETS
<S> <C> <C> <C>
Current assets:
Cash and cash equivalents....................................$ 153,294 $ 882,770 (a) $ 554,617
(467,619) (b)
(6,159) (d)
(2,160) (f)
(5,509) (i)
Short-term investments....................................... 94,552 -- 94,552
Receivables.................................................. 123,205 (113,588) (a) 9,617
Inventories.................................................. 85,011 (85,011) (a) --
Deferred income tax benefit.................................. 21,786 (12,703) (a) 9,083
Prepaid expenses and other current assets.................... 5,864 (4,867) (a) 997
----------- ---------- ----------
Total current assets..................................... 483,712 185,154 668,866
Investments..................................................... 14,256 -- 14,256
Properties...................................................... 69,341 (29,488) (a) 39,853
Unamortized costs in excess of net assets
of acquired companies........................................ 256,067 (236,882) (a) 19,185
Trademarks...................................................... 245,817 (239,722) (a) 6,095
Other intangible assets......................................... 33,327 (33,040) (a) 287
Deferred costs and other assets................................. 47,942 (7,217) (a) 11,359
(655) (f)
(28,711) (i)
----------- ---------- ----------
$ 1,150,462 $ (390,561) $ 759,901
=========== ========== ==========
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
Current liabilities:
Current portion of long-term debt............................$ 42,551 $ (1,737) (a) $ 2,973
(37,841) (b)
Accounts payable............................................. 75,942 (54,722) (a) 3,320
(17,900) (j)
Accrued expenses............................................. 128,406 (69,866) (a) 288,352
(9,329) (b)
251,792 (h)
(12,651) (i)
----------- ---------- ----------
Total current liabilities.............................. 246,899 47,746 294,645
Long-term debt.................................................. 855,912 (300,067) (a) 18,636
(116,760) (a)
(420,449) (b)
Intercompany payable (receivable)............................... -- (118,282) (a) --
100,382 (c)
17,900 (j)
Deferred income taxes........................................... 98,740 (61,669) (a) 56,895
19,824 (h)
Deferred income and other liabilities........................... 23,592 (2,667) (a) 16,284
1,476 (e)
(3,750) (a)
(2,367) (g)
Forward purchase obligation for common stock.................... 86,186 -- 86,186
Stockholders' equity (deficit):
Common stock................................................. 3,555 -- 3,555
Additional paid-in-capital................................... 204,336 -- 204,336
Retained earnings (accumulated deficit)...................... (83,370) 849,772 (a) 364,752
(100,382) (c)
(6,159) (d)
(1,476) (e)
(2,815) (f)
2,367 (g)
(271,616) (h)
(21,569) (i)
Treasury stock............................................... (198,735) -- (198,735)
Common stock to be acquired.................................. (86,186) -- (86,186)
Accumulated other comprehensive deficit...................... (467) -- (467)
----------- ---------- ----------
Total stockholders' equity (deficit)................... (160,867) 448,122 287,255
----------- ---------- ----------
$ 1,150,462 $ (390,561) $ 759,901
=========== ========== ==========
</TABLE>
(a) To reflect the Snapple Beverage Sale for estimated net proceeds aggregating
$1,311,362,000, net of estimated related expenses of $15,000,000. Such net
proceeds consist of (i) the assumption by the Purchaser of certain debt
consisting of (a) $300,000,000 of 101/4% senior subordinated notes due 2009
(the "Senior Notes") co-issued by Triarc Consumer Products Group, LLC
("TCPG"), the parent company of Snapple Beverage Group and Royal Crown, and
Snapple Beverage Group and accrued interest thereon of $11,832,000 as of
July 2, 2000 and (b) Triarc's zero coupon convertible subordinated
debentures due 2018 (the "Debentures") of $116,760,000, net of unamortized
original issue discount of $243,240,000, as of July 2, 2000 and (ii) cash,
which as of July 2, 2000, would have been $882,770,000. The $846,022,000
excess of proceeds over the net assets and liabilities of Snapple Beverage
Group and Royal Crown represents a component of the gain on the Snapple
Beverage Sale. The estimated net proceeds are subject to finalization of
post-closing purchase price adjustment provisions of the Snapple Beverage
Sale contract. Estimated related expenses are subject to finalization of
costs and expenses incurred in connection with the Snapple Beverage Sale
for investment banking advisory services, legal and accounting services and
other costs and expenses of the transaction as well as transaction related
incremental compensation costs and expenses.
(b) To reflect the payment of outstanding borrowings and accrued interest
thereon aggregating $467,619,000 under a senior bank credit facility (the
"Beverage Credit Facility") maintained by Snapple, Mistic, Stewart's, Royal
Crown and RCAC, LLC, formerly RC/Arby's Corporation, ("RC/Arby's") the
parent company of Royal Crown and Arby's, Inc. and a subsidiary of Triarc,
repaid in connection with the Snapple Beverage Sale. Such obligations as of
July 2, 2000 consisted of $438,290,000 of outstanding term loans, of which
$17,841,000 were classified as current and $420,449,000 were classified as
non-current, $20,000,000 of outstanding borrowings under a revolving credit
facility, all of which were classified as current, and $9,329,000 of
accrued interest thereon.
(c) To reflect non-cash capital contributions to Snapple Beverage Group and
Royal Crown, net of a non-cash dividend from Royal Crown, amounting to
$100,382,000 made in connection with the Snapple Beverage Sale which
increased the investment in Snapple Beverage Group and Royal Crown and thus
reduced the pre-tax gain from the Snapple Beverage Sale. Such capital
contributions and dividend related to intercompany balances with Snapple
Beverage Group and Royal Crown.
(d) To reflect a $6,159,000 cash payment made in connection with the Snapple
Beverage Sale to certain holders of Triarc stock options as a reduction of
the pre-tax gain from the Snapple Beverage Sale. Such payment was to
employees of Snapple Beverage Group and Royal Crown who were holders of an
aggregate of 912,169 Triarc stock options and who chose to give up their
Triarc stock options in connection with the Snapple Beverage Sale in
consideration for the payment of an amount per option equal to the excess
of the closing price of Triarc's common stock on October 20, 2000 over the
respective exercise prices of the underlying options.
(e) To reflect Triarc's obligation to issue its common shares issuable upon any
conversion of the Debentures which were assumed by the Purchaser as part of
the Snapple Beverage Sale as a reduction of the pre-tax gain from the
Snapple Beverage Sale. Such obligation will be accounted for as a written
call option (the "Written Call Option"). This adjustment reflects the
$1,476,000 estimated fair value of the Written Call Option as determined by
independent third party consultants utilizing the Black-Scholes option
pricing model. Should Triarc be required to issue any such common shares
upon any conversion, Triarc would receive compensation equal to the
accreted value of each of the Debentures converted as of that date.
(f) To reflect the cost associated with certain transactions which will no
longer be consummated as a result of the Snapple Beverage Sale, principally
a planned initial public offering of Snapple Beverage Group common stock as
a reduction of the pre-tax gain from the Snapple Beverage Sale. Such
amounts include the write-off of $655,000 of deferred costs as of July 2,
2000 and estimated additional unpaid costs as of July 2, 2000 of
$2,160,000.
(g) To reflect the reversal of previously accrued liabilities at Triarc no
longer required as a result of the Snapple Beverage Sale as an increase to
the pre-tax gain from the Snapple Beverage Sale.
(h) To reflect a provision for income taxes of $271,616,000 on the estimated
$741,307,000 net pre-tax gain determined as of July 2, 2000 resulting from
the Snapple Beverage Sale resulting from the adjustments above. Such
provision consists of (i) a current income tax liability of $251,792,000
resulting from the pre-tax gain for income tax purposes on the Snapple
Beverage Sale as of July 2, 2000 and (ii) the utilization of $19,824,000 of
non-current deferred income tax assets included as a component of "Deferred
income taxes." The tax provision does not reflect an election, which has
not yet been made, to treat the transaction as an asset sale in lieu of a
stock sale under section 338(h)(10) of the Internal Revenue Code or any
payment by the Purchaser with respect thereto. The determination of such
gain based on account balances as of July 2, 2000, is preliminary, is
subject to changes in the balances of the investments in Snapple Beverage
Group and Royal Crown between July 2, 2000 and the October 25, 2000 sale
date and is subject to finalization of post-closing purchase price
adjustment provisions of the Snapple Beverage Sale contract, finalization
of estimated related expenses incurred in connection with the Snapple
Beverage Sale as discussed in (a) above, and, as such, such gain is not
necessarily indicative of the gain that will actually be recognized for the
Snapple Beverage Sale.
(i) To reflect an extraordinary charge of $21,569,000 determined as of July 2,
2000 for the early assumption or extinguishment, as applicable, of the
Senior Notes (see (a) above), the Debentures (see (a) above) and the
obligations under the Beverage Credit Facility (see (b) above). Such
charges consisted of (i) the write-off of previously unamortized deferred
financing costs of $28,711,000 and (ii) the payment of prepayment penalties
of $5,509,000, net of income tax benefit of $12,651,000.
(j) To reverse current liabilities related to raw materials purchased from
third party vendors by Triarc on behalf of Snapple Beverage Group and Royal
Crown and Triarc's corresponding intercompany receivable since such
liabilities were assumed by Snapple Beverage Group and Royal Crown upon the
Snapple Beverage Sale.
<PAGE>
<TABLE>
<CAPTION>
Triarc Companies, Inc. and Subsidiaries
Unaudited Pro Forma Condensed Consolidated Statement of Operations
Year Ended January 2, 2000
As Pro Forma
Reported Adjustments Pro Forma
-------- ----------- ---------
(In thousands, except per share amounts)
<S> <C> <C> <C>
Revenues:
Net sales............................................$ 770,943 $ (770,943) (a) $ --
Royalties, franchise fees and other revenues......... 83,029 (1,243) (a) 81,786
------------- ------------- -----------
853,972 (772,186) 81,786
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Costs and expenses:
Costs of sales, excluding depreciation and
amortization related to sales...................... 407,708 (407,708) (a) --
Advertising, selling and distribution................ 201,451 (200,990) (a) 461
General and administrative........................... 121,779 (60,194) (a) 61,585
Depreciation and amortization, excluding
amortization of deferred financing costs........... 35,315 (29,892) (a) 5,423
Capital structure reorganization related charges..... 5,474 (3,348) (a) 2,126
Credit related to post-acquisition transition,
integration and changes to business strategies..... (549) 549 (a) --
Facilities relocation and corporate restructuring
credits............................................ (461) 158 (a) (303)
------------- ------------- -----------
770,717 (701,425) 69,292
------------- ------------- -----------
Operating profit................................... 83,255 (70,761) 12,494
Interest expense........................................ (84,257) 55,168 (a) (1,260)
7,102 (b)
20,727 (c)
Investment income, net.................................. 18,468 (1,564) (a) 16,904
Gain on sale of businesses, net......................... 655 533 (a) 1,188
Other income, net....................................... 3,559 (1,276) (a) 2,283
------------- ------------- -----------
Income from continuing operations before
income taxes..................................... 21,680 9,929 31,609
Provision for income taxes.............................. (12,945) 13,173 (a) (9,584)
(9,812) (d)
------------- ------------- -----------
Income from continuing operations..................$ 8,735 $ 13,290 $ 22,025
============= ============= ===========
Income from continuing operations per share:
Basic..............................................$ .34 (e) $ .85 (e)
============= ===========
Diluted............................................$ .32 (e) $ .82 (e)
============= ===========
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Triarc Companies, Inc. and Subsidiaries
Unaudited Pro Forma Condensed Consolidated Statement of Operations
Six Months Ended July 2, 2000
As Pro Forma
Reported Adjustments Pro Forma
-------- ----------- ---------
(In thousands, except per share amounts)
<S> <C> <C> <C>
Revenues:
Net sales...............................................$ 414,867 $ (414,867) (a) $ --
Royalties, franchise fees and other revenues............ 41,320 (642) (a) 40,678
------------ ------------ ----------
456,187 (415,509) 40,678
------------ ------------ ----------
Costs and expenses:
Cost of sales, excluding depreciation and
amortization related to sales......................... 217,567 (217,567) (a) --
Advertising, selling and distribution................... 114,618 (114,443) (a) 175
General and administrative.............................. 64,447 (32,270) (a) 32,177
Depreciation and amortization, excluding
amortization of deferred financing costs.............. 18,465 (15,751) (a) 2,714
Capital structure reorganization related charges........ 649 (408) (a) 241
------------ ------------ ----------
415,746 (380,439) 35,307
------------ ------------ ----------
Operating profit...................................... 40,441 (35,070) 5,371
Interest expense........................................... (46,618) 29,439 (a) (1,243)
3,729 (b)
12,207 (c)
Investment income, net..................................... 21,488 (416) (a) 21,072
Other income, net.......................................... 934 (699) (a) 235
------------ ------------ ----------
Income from continuing operations before
income taxes........................................ 16,245 9,190 25,435
Provision for income taxes................................. (8,935) 3,916 (a) (10,634)
(5,615) (d)
------------ ------------ ----------
Income from continuing operations.....................$ 7,310 $ 7,491 $ 14,801
============ ============ ==========
Income from continuing operations per share:
Basic.................................................$ .31 (e) $ .62 (e)
============ ==========
Diluted...............................................$ .29 (e) $ .59 (e)
============ ==========
</TABLE>
<PAGE>
(a) To eliminate the results of operations of the premium beverage business and
the soft drink concentrate business aggregating $4,727,000 and $2,830,000
for the year ended January 2, 2000 and the six months ended July 2, 2000,
respectively, since it is assumed the Snapple Beverage Sale occurred on
January 4, 1999.
(b) To eliminate interest expense, consisting of amortization of original issue
discount and deferred financing costs, accounted for by Triarc on the
Debentures which are being assumed by the Purchaser since it is assumed the
Debentures were assumed on January 4, 1999.
(c) To eliminate interest expense, including amortization of deferred financing
costs, accounted for by TCPG on the Senior Notes which are being assumed by
the Purchaser since it is assumed the Senior Notes were assumed on January
4, 1999. Such elimination of interest expense on the Senior Notes has been
reduced by intercompany interest expense on related intercompany debt to
TCPG aggregating $6,002,000 and $3,915,000 for the year ended January 2,
2000 and the six months ended July 2, 2000, respectively. For the year
ended January 2, 2000 such elimination of interest expense has also been
reduced by $1,350,000 of interest expense on the Senior Notes which was
allocated to the restaurant franchising business in the historical
financial statements of the restaurant franchising business.
(d) To eliminate the income tax benefit related to adjustments in (b) and (c)
above, as applicable, at the incremental weighted average Federal and State
income tax rates of 35.3% and 35.2% for the year ended January 2, 2000 and
the six months ended July 2, 2000, respectively, based on the entities to
which the adjustments related.
(e) As reported and pro forma basic and diluted income from continuing
operations per share has been computed by dividing the as reported and pro
forma income from continuing operations by the shares as follows (in
thousands):
Six Months
Year Ended Ended
January 2, July 2,
2000 2000
---- ----
Basic:
Weighted average common shares
outstanding.............................. 26,015 23,880
====== ======
Diluted:
Common shares for basic income
per share................................ 26,015 23,880
Additional common shares from
(1) the effect of dilutive stock options
computed using the treasury
stock method and..................... 818 873
(2) the effect of a dilutive forward
purchase obligation for common
stock................................ 110 363
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26,943 25,116
======== =======
The Written Call Option for common stock recorded in connection with the
Snapple Beverage Sale was not used in the calculation of diluted income per
share since the inclusion of such shares would have had an antidilutive
effect.
<PAGE>
Note: Income from continuing operations excludes $469,691,000 of estimated
gain on the Snapple Beverage Sale, net of income taxes and a $21,569,000
extraordinary charge for the early extinguishment of debt, net of taxes
determined as of July 2, 2000. Such amounts, as determined as of the
October 25, 2000 sales date, will be recognized during the Company's
fiscal quarter ended December 31, 2000 as income from discontinued
operations.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
TRIARC COMPANIES, INC.
Date: December 1, 2000 By: /s/ Fred H. Schaefer
--------------------------
Fred H. Schaefer
Senior Vice President and
Chief Accounting Officer
