SEAGRAM CO LTD, DEF 14A, 1997-09-26

SEAGRAM CO LTD
DEF 14A, 1997-09-26
BEVERAGES

Previous: SCI SYSTEMS INC, 10-K, 1997-09-26

Next: SEAGRAM CO LTD, 10-K405, 1997-09-26

<PAGE> 1

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:

<TABLE>
<S> <C>
[ ] Preliminary Proxy Statement [ ] Confidential, for Use of the Commission
Only (as permitted by Rule 14a-6(e)(2))
[x] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Section 240.14a-11(c) or Section 240.14a-2.
</TABLE>

THE SEAGRAM COMPANY LTD.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)

- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than 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)(4) and 0-12.

(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:

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

(2) Form, Schedule or Registration Statement No.:

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

(3) Filing Party:

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

(4) Date Filed:

------------------------------------------------------------------------
<PAGE> 2

THE SEAGRAM COMPANY LTD.

LOGO

NOTICE OF ANNUAL MEETING OF SHAREHOLDERS

NOTICE IS HEREBY GIVEN that the Annual Meeting of Shareholders (the
"Meeting") of The Seagram Company Ltd. (the "Corporation") will be held at The
Queen Elizabeth Hotel, 900 Rene-Levesque Boulevard West, in the City of
Montreal, Province of Quebec, on Wednesday, the 5(th) day of November, 1997, at
11:30 a.m. (E.S.T.) for the following purposes:

1. To receive the Report of Directors and Consolidated Financial
Statements of the Corporation for the fiscal year ended June 30, 1997;

2. To elect directors;

3. To appoint auditors; and

4. To transact such other business as may properly come before the
Meeting.

Montreal, Quebec, September 25, 1997. BY ORDER OF THE BOARD OF DIRECTORS,

/s/Michael C. L. Hallows
-------------------------
MICHAEL C. L. HALLOWS

Secretary

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

IMPORTANT

SHAREHOLDERS WHO ARE UNABLE TO ATTEND THE MEETING IN PERSON ARE
REQUESTED TO COMPLETE, DATE, SIGN AND RETURN PROMPTLY THE ENCLOSED PROXY IN THE
ENVELOPE PROVIDED FOR THAT PURPOSE.

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

On peut se procurer l'edition francaise de cet avis de l'assemblee, de la
procuration et de la circulaire de sollicitation de procurations en ecrivant au
Secretaire, La Compagnie Seagram Ltee, 1430, rue Peel, Montreal (Quebec) H3A
1S9; ADDRESSE ELECTRONIQUE: SHAREHOLDERS*[email protected].
<PAGE> 3

THE SEAGRAM COMPANY LTD.
1430 Peel Street
Montreal, Quebec, Canada H3A 1S9
------------------------------------

ANNUAL MEETING OF SHAREHOLDERS

PROXY CIRCULAR

This Proxy Circular is furnished to shareholders in connection with the
solicitation by the Board of Directors of The Seagram Company Ltd. (the
"Corporation") of proxies to be voted at the Annual Meeting of Shareholders of
the Corporation (the "Meeting") to be held at the time and place and for the
purposes set forth in the accompanying notice and at any and all adjournments
thereof. There is enclosed herewith a notice of the Meeting and proxy for use at
the Meeting. There is also enclosed a copy of the Report of Directors and
Consolidated Financial Statements of the Corporation for the fiscal year ended
June 30, 1997 (the "Fiscal Year"), to be placed before the shareholders at the
Meeting pursuant to the requirements of the Canada Business Corporations Act,
but such Report is not deemed to be proxy soliciting material. Except as
otherwise stated, the information contained herein is given as of August 31,
1997. The approximate date this Proxy Circular will be first mailed to
shareholders is September 25, 1997. Only the holders of record of common shares
(the "Shares") of the Corporation at the close of business on September 17, 1997
will be entitled to receive notice of the Meeting.

All dollar amounts stated herein are expressed in United States currency
except where otherwise indicated.

SOLICITATION OF PROXIES

THE ENCLOSED PROXY IS BEING SOLICITED BY THE BOARD OF DIRECTORS OF THE
CORPORATION and the expenses of solicitation of proxies will be borne by the
Corporation. The solicitation will be made primarily by mail, but officers and
regular employees of the Corporation may also solicit proxies by telephone,
telegraph, facsimile or in person. The Corporation also has retained D. F. King
& Co., Inc. to assist in soliciting proxies for a fee of $5,500 plus
reimbursement of reasonable out-of-pocket expenses. In connection with its
general engagement to provide shareholder services for the Corporation, CIBC
Mellon Trust Company also assists in soliciting proxies in Canada.

APPOINTMENT OF PROXIES

EACH SHAREHOLDER MAY APPOINT A PERSON (WHO NEED NOT BE A SHAREHOLDER) OTHER
THAN THE PERSONS NAMED IN THE ENCLOSED PROXY TO REPRESENT HIM OR HER AT THE
MEETING BY INSERTING SUCH PERSON'S NAME IN THE BLANK SPACE PROVIDED IN THE
ENCLOSED PROXY OR BY COMPLETING ANOTHER PROPER PROXY. IN EITHER CASE, SUCH
COMPLETED PROXY SHOULD BE RETURNED IN THE ENCLOSED ENVELOPE PROVIDED FOR THAT
PURPOSE FOR DELIVERY BEFORE THE MEETING OR SHOULD BE DELIVERED TO THE SECRETARY
OF THE CORPORATION AT 1430 PEEL STREET, MONTREAL, QUEBEC, NOT LATER THAN 5 P.M.
ON TUESDAY, NOVEMBER 4, 1997.

REVOCATION OF PROXIES

A shareholder giving a proxy pursuant to this solicitation may revoke such
proxy by instrument in writing executed by the shareholder or by his attorney
duly authorized in writing or, if the shareholder is a corporation, by an
officer or attorney thereof duly authorized, and deposited either at the
executive offices or the registered office of the Corporation at any time up to
and including the last business day preceding the day of the Meeting, or any
adjournment thereof, or with the Chairman of the Meeting on the day of the
Meeting, or any adjournment thereof.

VOTING OF THE SHARES AT THE MEETING

The persons named in the enclosed proxy will vote the Shares in respect of
which they are appointed in accordance with the directions of the shareholder
appointing them. IN THE ABSENCE OF SUCH DIRECTIONS, SUCH SHARES WILL BE VOTED
(I) FOR THE ELECTION OF DIRECTORS AND (II) FOR THE APPOINTMENT OF AUDITORS AS
STATED UNDER THE APPLICABLE HEADINGS IN THIS PROXY CIRCULAR.

1
<PAGE> 4

The enclosed proxy confers discretionary authority upon the persons named
therein with respect to amendments to or variations of matters identified in the
notice of Meeting and with respect to such other matters as may properly come
before the Meeting. Management does not intend to present any other matters for
action at the Meeting and has no knowledge that any person intends to present
any matters that may be properly presented at the Meeting. However, if any other
matters properly come before the Meeting, the persons named in the proxy shall
vote the Shares represented by such proxies in accordance with their judgment on
such matters.

Holders of Shares listed as shareholders at the close of business on
September 17, 1997 will be entitled to one vote for each Share held, except that
if such a holder subsequently transfers the ownership of a Share and the
transferee establishes that he or she owns such Share and requests not later
than ten days before the Meeting that he or she be included on the shareholders'
list, such transferee (and not his or her transferor) will be entitled to vote
such Share at the Meeting. As of August 31, 1997, the Corporation had
outstanding 356,445,718 Shares, and there were outstanding options which are
currently exercisable or become exercisable within 60 days to acquire an
additional 19,875,759 Shares.

SHARE OWNERSHIP

PRINCIPAL HOLDERS OF SHARES

As of August 31, 1997, descendants of the late Samuel Bronfman and trusts
established for their benefit beneficially owned directly or indirectly an
aggregate of 126,535,961 Shares, constituting approximately 35.5% of the
outstanding Shares, and held options which are currently exercisable or become
exercisable within 60 days to acquire an additional 3,293,821 Shares. This
amount includes the Shares owned by the following persons, who are the only
persons known by the Corporation to own beneficially, or exercise control or
direction over, more than 5% of the outstanding Shares as of August 31, 1997.

<TABLE>
<CAPTION>
Percentage
Number of Shares
Beneficial Owner of Shares Outstanding
- ----------------------------------------------------------- -------------- -----------
<S> <C> <C>
EDGAR MILES BRONFMAN TRUST................................. 62,554,604(1) 17.55%
C. BRONFMAN FAMILY TRUST,
CHARLES ROSNER BRONFMAN FAMILY TRUST,
CHARLES BRONFMAN TRUST AND
CHARLES R. BRONFMAN TRUST.................................. 51,520,000(2) 14.45%
</TABLE>

- ---------------
(1) Includes 61,068,088 Shares owned indirectly by the Edgar Miles Bronfman
Trust, 375 Park Avenue, New York, New York, a trust established for the
benefit of Edgar M. Bronfman and his descendants (the "EMBT"), through its
99% interest in Bronfman Associates, a partnership of which Edgar M.
Bronfman is the managing general partner, and 1,486,516 Shares owned
directly by the PBBT/Edgar Miles Bronfman Family Trust, a trust established
for the benefit of Edgar M. Bronfman and his descendants (the "PBBT/EMBFT").
The trustees of the EMBT and the PBBT/EMBFT include Edgar M. Bronfman and
Edgar Bronfman, Jr.

(2) Includes 23,320,000 Shares owned indirectly by the C. Bronfman Family Trust
(the "C.BFT"), c/o Chancery Chambers, Chancery House, High Street,
Bridgetown, Barbados, 24,800,000 Shares owned by the Charles Rosner Bronfman
Family Trust (the "CRBFT"), c/o Goodman Phillips & Vineberg, 1501 McGill
College Avenue, Montreal, Quebec, and 1,700,000 Shares owned by the Charles
Bronfman Trust (the "CBT") and 1,700,000 shares owned by the Charles R.
Bronfman Trust (the "CR.BT"), each c/o Goodman Phillips & Vineberg, 430 Park
Avenue, New York, New York. The C.BFT, the CRBFT, the CBT and the CR.BT are
trusts established for the benefit of Charles R. Bronfman and his
descendants. The trustees of the CRBFT include Arnold M. Ludwick.

In addition, as of August 31, 1997 Phyllis Lambert owned directly or
indirectly 1,000,000 Shares and trusts for the benefit of the family of the late
Minda de Gunzburg and members of her immediate family owned directly or
indirectly an aggregate of 6,279,944 Shares.

Edgar M. Bronfman, Charles R. Bronfman, Phyllis Lambert and the late Minda
de Gunzburg are siblings. Edgar M. Bronfman and Charles R. Bronfman are
directors and officers of the Corporation. Edgar Bronfman, Jr. is a son of Edgar
M. Bronfman and a director and officer of the Corporation and Samuel Bronfman II
is a son of Edgar M. Bronfman and a director of the Corporation. Arnold M.
Ludwick is an officer of the Corporation.

2
<PAGE> 5

Pursuant to a voting trust agreement dated August 3, 1984, as amended (the
"Bronfman voting trust agreement"), Charles R. Bronfman serves as voting trustee
for 700,000 Shares owned directly by him and Shares beneficially owned directly
or indirectly by the EMBT, the PBBT/EMBFT, the C.BFT, the CRBFT, the CBT, the
CR.BT and two charitable foundations, of which Charles R. Bronfman and Arnold M.
Ludwick are among the directors, that owned collectively 3,874,164 Shares as of
August 31, 1997. The Bronfman voting trust agreement has a term of 20 years and
contains no restrictions on the right of the voting trustee to vote the
deposited Shares. As of August 31, 1997, 118,648,768 Shares were subject to the
Bronfman voting trust agreement.

Pursuant to a voting trust agreement dated as of May 15, 1986 (the "de
Gunzburg voting trust agreement"), Edgar M. Bronfman, Charles R. Bronfman,
Stanley N. Bergman, Guido Goldman and Leonard M. Nelson serve as voting trustees
for Shares beneficially owned directly or indirectly by trusts for the benefit
of the family of the late Minda de Gunzburg and by members of her immediate
family. Messrs. Bergman, Goldman and Nelson, whose address is c/o First Spring
Corporation, 499 Park Avenue, New York, New York, are the trustees of such
trusts. The de Gunzburg voting trust agreement has a term of 15 years and
contains no restrictions on the right of the voting trustees to vote the
deposited Shares. As of August 31, 1997, 6,279,064 Shares were subject to the de
Gunzburg voting trust agreement.

Shares owned directly or indirectly by the EMBT, the PBBT/EMBFT, the C.BFT,
the CRBFT, the CBT, the CR.BT, the trusts established for the benefit of the
family of the late Minda de Gunzburg and by members of her immediate family, the
charitable foundations referred to above and Phyllis Lambert are subject to an
agreement governing dispositions of Shares. The agreement, entered into as of
August 3, 1984, as amended, has a term of 20 years and permits transfers by each
of the four branches of the family within its family group. However, transfers
to third parties are subject to a right of first refusal in favour of the other
branches of the family.

SHARE OWNERSHIP OF MANAGEMENT

Set forth below is the number of Shares which each of the directors of the
Corporation and nominees for director, each of the persons named in the "Summary
Compensation Table" and the directors and executive officers of the Corporation
as a group owned beneficially, or exercised control or direction over, as of
August 31, 1997. Each trustee of a trust or a charitable foundation may be
deemed to be the beneficial owner of the Shares held by the trust or foundation.
Because certain persons listed below serve as trustees of the same trusts or
charitable foundations, there are substantial duplications in the number of
shares and percentages shown in the table.

<TABLE>
<CAPTION>
Percentage Deferred
Number of of Shares Share
Beneficial Owner Shares Outstanding Units(1)
- ---------------------------------------------------------- ----------- ------------- ---------
<S> <C> <C> <C>
Edgar M. Bronfman......................................... 63,629,427(2) 17.85% --
The Hon. Charles R. Bronfman, P.C., C.C. ................. 57,106,047(3) 16.02% --
Edgar Bronfman, Jr. ...................................... 64,735,177(4) 18.16% --
Samuel Bronfman II........................................ 353,907(5) * --
Matthew W. Barrett, O.C. ................................. 1,000 * 1,235
Laurent Beaudoin, C.C..................................... --(6) * --
Frank J. Biondi, Jr. ..................................... 500,500(7) * --
Richard H. Brown.......................................... -- * --
The Honourable William G. Davis, P.C., C.C., Q.C. ........ 681 * --
Andre Desmarais........................................... -- * --
The Honourable Paul Desmarais, P.C., C.C. ................ 12,580 * --
Michele J. Hooper......................................... 1,539 * --
David L. Johnston, O.C. .................................. 400 * 1,429
The Honourable E. Leo Kolber, Senator..................... 4,240 * 1,312
Marie-Josee Kravis, O.C. ................................. 400 * 984
Robert W. Matschullat..................................... 545,500(8) * --
C. Edward Medland......................................... 6,000 * 1,392
Lew R. Wasserman.......................................... 10,000(9) * --
John S. Weinberg.......................................... 6,500(10) * 1,429
Directors and executive officers as a group............... 124,594,753(11) 34.95%
</TABLE>

- ---------------
* Less than 1%

3
<PAGE> 6

(1) See "Compensation of Directors" for a description of the deferred share
units under The Seagram Company Ltd. Stock Plan for Non-Employee Directors.

(2) Includes 61,068,088 Shares owned indirectly by the EMBT and 1,486,516
Shares owned directly by the PBBT/EMBFT, trusts for which Mr. Bronfman
serves as a trustee, 240 Shares owned directly by Mr. Bronfman, 831,787
Shares issuable upon the exercise of currently exercisable options, 1,840
Shares owned by Mr. Bronfman's spouse, 600 Shares owned directly by his
children (other than Edgar Bronfman, Jr. and Samuel Bronfman II), 356
Shares owned by an estate for which Mr. Bronfman is an executor, and
240,000 Shares owned by a charitable foundation of which Mr. Bronfman is
among the trustees. Mr. Bronfman disclaims beneficial ownership of the
foregoing Shares, except to the extent of his beneficial interest in the
EMBT and the PBBT/EMBFT and with respect to Shares owned directly by him.
In addition, Mr. Bronfman serves as a voting trustee with respect to the
6,279,064 Shares subject to the de Gunzburg voting trust agreement with
respect to which Mr. Bronfman disclaims beneficial ownership.

(3) Includes 23,320,000 Shares owned directly by the C.BFT, 24,800,000 Shares
owned directly by the CRBFT, 1,700,000 Shares owned directly by the CBT and
1,700,000 Shares owned directly by the CR.BT, trusts for which Mr. Bronfman
serves as a trustee and/or voting trustee, 1,002,760 Shares owned directly
by Mr. Bronfman, 408,767 Shares issuable upon exercise of currently
exercisable options, 12,000 Shares owned by Mr. Bronfman's spouse, 48,000
Shares owned directly by his children, 356 Shares owned by an estate for
which Mr. Bronfman is an executor, and 4,114,164 Shares owned by three
charitable foundations of which Mr. Bronfman is among the directors or
trustees. Mr. Bronfman disclaims beneficial ownership of the foregoing
Shares, except with respect to Shares owned directly by him. In addition,
Mr. Bronfman serves as the voting trustee with respect to 62,554,604 Shares
held by the EMBT and the PBBT/EMBFT subject to the Bronfman voting trust
agreement and as a voting trustee with respect to 6,279,064 Shares subject
to the de Gunzburg voting trust agreement with respect to which Mr.
Bronfman disclaims beneficial ownership.

(4) Includes 61,068,088 Shares owned indirectly by the EMBT and 1,486,516
Shares owned directly by the PBBT/EMBFT, trusts for which Mr. Bronfman
serves as a trustee, 240 Shares owned directly by Mr. Bronfman, 1,939,600
Shares issuable upon exercise of options which are currently exercisable or
become exercisable within 60 days, 240,000 Shares owned by a charitable
foundation of which Mr. Bronfman is among the trustees and 733 Shares in
which Mr. Bronfman has an indirect interest through an investment in the
Retirement Savings and Investment Plan for Employees of Joseph E. Seagram &
Sons, Inc. and Affiliates (based on the value of such investment as of
August 31, 1997). Mr. Bronfman disclaims beneficial ownership of the
foregoing Shares, except to the extent of his beneficial interest in the
EMBT and the PBBT/EMBFT and with respect to Shares owned directly by him.

(5) Includes 240 Shares owned directly by Mr. Bronfman, 113,667 Shares issuable
upon exercise of currently exercisable options and 240,000 Shares owned by
a charitable foundation of which Mr. Bronfman is among the trustees. Mr.
Bronfman disclaims beneficial ownership of the foregoing Shares except the
Shares owned directly by him.

(6) Does not include 300 Shares held by Gestion Claire B. Beaudoin Inc., a
company owned by Mr. Beaudoin's wife, with respect to which Mr. Beaudoin
disclaims beneficial ownership.

(7) Includes 500 Shares owned directly by Mr. Biondi and 500,000 Shares
issuable upon exercise of currently exercisable options. See "Employment
and Consulting Agreements". Mr. Biondi disclaims beneficial ownership of
the foregoing Shares except with respect to Shares owned directly by him.

(8) Includes 66,750 Shares owned directly by Mr. Matschullat, 445,500 Shares
issuable upon exercise of options which are currently exercisable or become
exercisable within 60 days and 33,250 Shares which are being held by a bank
subject to restrictions (including the risk of forfeiture) which lapse on
October 1, 1997 or earlier in certain circumstances. See "Employment and
Consulting Agreements". Mr. Matschullat disclaims beneficial ownership of
the foregoing Shares except with respect to Shares owned directly by him.

(9) Includes 10,000 Shares held by a charitable foundation of which Mr.
Wasserman is chairman and with respect to which he disclaims beneficial
ownership. Mr. Wasserman serves as a trustee of a trust for the benefit of
Mr. Wasserman and his wife which holds all 65,392 outstanding shares of the
preferred stock of Universal Studios Holding II Corp., an indirect parent
of Universal Studios, Inc., formerly MCA INC. ("Universal"), in which the
Corporation has an indirect 80% common equity interest ("Holding"). Holders
of such preferred stock are entitled to 8.75% cumulative annual dividends
when, as and if declared by the board of directors of Holding. The
preferred stock was issued in 1990 in connection with the acquisition of
Universal by Matsushita Electric Industrial Co., Ltd.

(10) Includes 1,000 Shares owned directly and 5,500 Shares owned by a trust
established for the benefit of Mr. Weinberg for which he serves as a
trustee.

(11) Includes 5,193,136 Shares issuable upon exercise of options which are
currently exercisable or become exercisable within 60 days.

4
<PAGE> 7

ELECTION OF DIRECTORS

NOMINEES FOR DIRECTOR

The persons named in the enclosed proxy, unless otherwise directed by the
shareholder appointing them, intend to vote at the Meeting for the election of
all the nominees whose names are set forth below. Management does not
contemplate that any of the nominees will be unable to serve as a director but,
if such inability occurs for any reason prior to the Meeting, the persons named
in the enclosed proxy reserve the right to vote, in their discretion, the Shares
represented by such proxy for the election of any other person or persons
nominated by the Board of Directors. Each director elected will hold office
until the next annual meeting of shareholders and until his or her successor is
duly elected, unless his or her office is earlier vacated in accordance with the
By-Laws of the Corporation.

Certain information is given in the following table with respect to the
nominees for director of the Corporation. All such persons have been engaged in
the occupation or employment set forth opposite their respective names in their
current capacities for more than five years except where indicated. Statements
contained in such table with respect to each nominee are based upon information
obtained from the person concerned.

EDGAR M. BRONFMAN............ 68 Chairman of the Board of the Corporation since
June 1994. Previously, he was Chairman of the
Board and Chief Executive Officer.............. 1955
THE HONOURABLE
CHARLES R. BRONFMAN,
P.C., C.C.................. 66 Co-Chairman of the Board and Chairman of the
Executive Committee of the Corporation. Mr.
Bronfman is also a director of Power
Corporation of Canada.......................... 1958

EDGAR BRONFMAN, JR........... 42 President and Chief Executive Officer of the
Corporation since June 1994. Previously, he was
President and Chief Operating Officer.......... 1988

SAMUEL BRONFMAN II........... 43 President of Seagram Chateau & Estate Wines
Company (a division of Joseph E. Seagram &
Sons, Inc., a subsidiary of the
Corporation)................................... 1991

MATTHEW W. BARRETT, O.C...... 52 Chairman and Chief Executive Officer of Bank of
Montreal (a financial institution). Mr. Barrett
is also a director of The Molson Companies
Limited........................................ 1995

LAURENT BEAUDOIN, C.C........ 59 Chairman and Chief Executive Officer of
Bombardier Inc. (a transportation, aerospace
and motorized products company) since 1979..... --

FRANK J. BIONDI, JR.......... 52 Chairman and Chief Executive Officer of
Universal since April 1996. Previously, he was
President, Chief Executive Officer and a
director of Viacom Inc. (an entertainment and
publishing company). Mr. Biondi is also a
director of The Bank of New York and Vail
Resorts Inc.................................... 1996
</TABLE>

5
<PAGE> 8

RICHARD H. BROWN............. 50 Chief Executive of Cable and Wireless plc (a
provider of international telecommunications
services) since July 1996. From May 1995 to
July 1996 he served as President and Chief
Executive Officer of H & R Block, Inc. and from
January 1993 to April 1994 he was Vice Chairman
of Ameritech Corporation. Previously he was
President and Chief Executive Officer of
Illinois Bell (a subsidiary of Ameritech
Corporation) from January 1990 to July 1993.
Mr. Brown is also a director of Pharmacia and
Upjohn, Inc.................................... --

THE HONOURABLE
WILLIAM G. DAVIS,
P.C., C.C., Q.C............ 68 Counsel to Tory Tory DesLauriers & Binnington
(attorneys). Mr. Davis is also a director of
Algoma Steel Inc., Canadian Imperial Bank of
Commerce, Corel Corporation, Dylex Limited,
First American Financial Corporation, First
American Title Insurance Company, International
Comfort Products Corporation, Magna
International Inc., Magellan Aerospace
Corporation, NIKE Canada Ltd., Power
Corporation of Canada and St. Lawrence Cement
Inc............................................ 1985

ANDRE DESMARAIS.............. 40 President and Co-Chief Executive Officer of
Power Corporation of Canada (a holding and
management company) and Deputy Chairman of
Power Financial Corporation since May 1996.
From May 1994 to May 1996 he was Chairman of
Power Pacific Corporation Limited. Previously
he was President and Chief Operating Officer of
Power Corporation of Canada. Mr. Desmarais is
also a director of Bombardier Inc., Groupe
Bruxelles-Lambert S.A., Great-West Lifeco Inc.,
The Great-West Life Assurance Company,
Investors Group Inc. and Pargesa Holding
S.A............................................ --

MICHELE J. HOOPER............ 46 Corporate Vice President of Caremark
International Inc. (a health care services
provider) since 1993. She has also served as
President of the International Business Group
of Caremark International Inc. since December
1991. Previously, she was President of Baxter
Canada, a division of Baxter International Inc.
Ms. Hooper is also a director of Dayton Hudson
Corporation and PPG Industries................. 1996

DAVID L. JOHNSTON, O.C....... 56 Professor of Law at McGill University (an
educational institution) since July 1994.
Previously, he was also Principal and
Vice-Chancellor. Mr. Johnston is also a
director of CT Financial Services Inc.,
Dominion Textile Inc., Emco Limited and The CGI
Group Inc...................................... 1987
</TABLE>

6
<PAGE> 9

<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------
Director
Name Age Principal occupation and other information since
- --------------------------------------------------------------------------------------------
<S> <C> <C> <C>
THE HONOURABLE
E. LEO KOLBER, SENATOR..... 68 Member of The Senate of Canada. He was also
Chairman of Board of Claridge Inc. (a
management company) from June 1987 to September
1993. Senator Kolber is also Chairman of the
Board of Cineplex Odeon Corporation (an
entertainment company) and a director of
The Toronto- Dominion Bank..................... 1971

MARIE-JOSEE KRAVIS, O.C...... 47 Senior Fellow of The Hudson Institute Inc. (a
non-profit economics research institute) since
March 1994. Previously, she was Executive
Director of The Hudson Institute of Canada Inc.
Mrs. Kravis is also a director of Canadian
Imperial Bank of Commerce, Hasbro, Inc.,
Hollinger International Inc., Ford Motor
Company, Limited and UniMedia Inc.............. 1985

ROBERT W. MATSCHULLAT........ 49 Vice Chairman and Chief Financial Officer of
the Corporation since October 1995. Previously,
he was Managing Director and Head of Worldwide
Investment Banking for Morgan Stanley & Co.,
Inc. and a director of Morgan Stanley Group,
Inc. (investment bankers). Mr. Matschullat is
also a director of Transamerica Corporation. .. 1995

C. EDWARD MEDLAND............ 69 President of Beauwood Investments Inc. (a
private investment company) since July 1994.
Previously, he was a Corporate Director. Mr.
Medland is also a director of
Abitibi-Consolidated Inc., CT Financial
Services Inc., Premium Income Corporation,
Teleglobe Inc. and The Thomson Corporation. ... 1973

LEW R. WASSERMAN............. 84 Chairman Emeritus of Universal since July 1995.
Previously, he was Chairman and Chief Executive
Officer of Universal. ......................... 1995

JOHN S. WEINBERG............. 40 General Partner of Goldman, Sachs & Co.
(investment bankers) since November 1992.
Previously, he was a vice president of Goldman,
Sachs & Co. ................................... 1995
</TABLE>

CORPORATE GOVERNANCE
GENERAL

In May 1995, both the Toronto Stock Exchange (the "TSE") and the Montreal
Exchange adopted a requirement that each company incorporated in Canada and
listed on such exchanges disclose its corporate governance practices with
reference to the guidelines contained in the final report of the Committee on
Corporate Governance of the TSE (the "TSE Report"). In accordance with those
listing requirements, a description of the Corporation's governance practices
with reference to the guidelines set out in the TSE Report, including
differences from the guidelines, is set forth below.

BOARD OF DIRECTORS

Stewardship. The Board of Directors is responsible for the overall
stewardship of the Corporation and for oversight of management to assure
protection of shareholder interests. The Board relies upon management for the
development of the overall corporate and individual business unit strategies.
The Board evaluates the strategic direction of the Corporation, for which
management prepares annual business and longer range strategic plans.

The Board, directly and through its Audit Committee, is responsible for
identifying the principal risks of the Corporation's businesses and ensuring the
implementation of appropriate strategies and systems to manage those

7
<PAGE> 10

risks. The Board, directly and through its Audit Committee, assesses the
integrity of the Corporation's internal controls and reviews the quality of its
management information systems.

It is the Board's responsibility to select the chief executive officer, to
evaluate the performance of the chief executive officer, and to provide for his
or her successor. The Board appoints the principal officers of the Corporation
and is responsible, directly and through its Human Resources Committee, for the
evaluation of the performance of the principal officers of the Corporation and
for development, training and succession planning for senior management.

The Corporation maintains an active investor relations program. Oral and
written inquiries from shareholders, the investment community and the general
public are responded to by the Secretary of the Corporation or the Vice
President, Investor Relations of Joseph E. Seagram & Sons, Inc. ("JES"). The
Board is advised of inquiries where appropriate. The investor relations program
also includes periodic presentations to the investment community. The Board
believes that the existing program facilitates effective communication with the
Corporation's shareholders, the general public, and the investment community.
The Board, directly and through its Audit Committee, reviews the interim and
annual financial results and approves the management proxy circular.

Size and Relatedness. While the Board is currently composed of 16
directors, there are 18 nominees seeking election at the Meeting. The Board
believes that seven of its current directors are "unrelated" to the Corporation
as defined in the TSE Report, i.e., independent of management and free from any
business or other relationship, which could, or could reasonably be perceived
to, materially interfere with the director's ability to act with a view to the
best interests of the Corporation, other than interests and relationships
arising from shareholdings. Seven directors are "related" to the Corporation
because they are members or former members of management, namely Edgar M.
Bronfman, Chairman of the Board, The Honourable Charles R. Bronfman, Co-Chairman
of the Board, Edgar Bronfman, Jr., President and Chief Executive Officer, Samuel
Bronfman II, President of Seagram Chateau & Estate Wines Company, Robert W.
Matschullat, Vice Chairman and Chief Financial Officer of the Corporation, Frank
J. Biondi, Jr., Chairman and Chief Executive Officer of Universal, and Lew R.
Wasserman, formerly Chairman and Chief Executive Officer of Universal. In
addition, two directors may be regarded as "related" in that they hold senior
positions with companies which have substantial ongoing business relationships
with the Corporation, namely Matthew W. Barrett, Chairman and Chief Executive
Officer of The Bank of Montreal, and John S. Weinberg, General Partner of
Goldman, Sachs & Co. Although a majority of the current Board may be considered
to qualify as "related" directors within the meaning of the TSE Report, a
majority (10) of the Corporation's 16 directors are not current officers or
employees of the Corporation or any of its affiliates and are therefore
"outside" directors as defined in the TSE Report. The Honourable Paul Desmarais,
P.C., C.C. will not be standing for re-election at the Meeting. Laurent
Beaudoin, C.C., Andre Desmarais and Richard H. Brown, all of whom are "outside"
directors and who are "unrelated" to the Corporation, are nominees for election
to the Board. Accordingly, if all nominees are elected, the number of directors
who are "unrelated" will increase to nine and the number of "outside" directors
will increase to 12. The Board believes that all members of the Board,
regardless of the existence of relationships to the Corporation, exercise
independent judgment with a view to the best interests of the Corporation, and
believes that the Corporation benefits from the knowledge, experience and mix of
skills which its directors bring to the Board. The Corporation has no
shareholder who qualifies as a "significant shareholder" within the meaning of
the TSE Report, i.e., a shareholder with the ability to exercise a majority of
the votes for the election of the Board of Directors. However, for information
regarding the shareholdings of the descendants of Samuel Bronfman, the founder
of the Corporation, and trusts established for their benefit, see "Share
Ownership".

The Chairman of the Board, Edgar M. Bronfman, while separate from the Chief
Executive Officer ("CEO"), is a "related" director. Mr. Bronfman served as CEO
for 19 years and has been a member of the Board for 42 years. The Board believes
that since the founding family retains substantial shareholdings in the
Corporation and members of that family have been, and continue to be, primarily
responsible for the management and development of the business, their depth of
experience and commitment, as well as long-range vision and strategic focus,
constitute an invaluable resource that provides continuity for the Corporation.
For these reasons, the Board believes that the composition of the Board is both
appropriate and beneficial to the Corporation and its shareholders and that Mr.
Bronfman is the most qualified director to act as Chairman.

Functioning. The Board approves major capital commitments, acquisitions
and expenditures which exceed established thresholds, significant divestitures,
dividends and certain changes to the Corporation's capital structure. The Board
does not have a formal Nominating Committee. In its stead, the Board performs
the functions of a

8
<PAGE> 11

nominating committee for the Corporation and provides for timely and orderly
nomination of new members capable of contributing to the effectiveness of the
Board. The Corporate Governance Committee has recently developed a formal
position description for directors. Consistent with such position description,
in considering candidates for election to the Board, experience running a major
business enterprise involved in the global distribution of products or services,
significant managerial leadership, good judgment, business acumen and board
experience with public companies are taken into account. The Corporation does
not have a formal process for assessing the effectiveness of the Board as a
whole, the committees of the Board and the contribution of individual directors,
nor does it have formal processes and practices to ensure the independence of
the Board from management.

The Corporation educates its new directors through presentations and by
providing them with materials which contain basic information about the
Corporation and related matters, which materials are updated, as appropriate. In
addition, Board meetings are held at various facility sites to provide the
directors with additional insight into the Corporation's businesses.

The Board has not developed a formal position description for the CEO.
Although the Board does not establish formal corporate objectives for the CEO,
certain portions of the compensation of the CEO are determined with reference to
established criteria. See "Report on Executive Compensation". In addition, there
is regular discussion at Board and Human Resources Committee meetings regarding
achievement by senior management of corporate and business unit strategic
objectives.

The Board has expanded the mandate of the Human Resources Committee to
include reviewing the adequacy and form of compensation of directors and
responsibility for succession planning for senior management.

Although there is no formal procedure to enable individual directors to
engage an outside advisor at the expense of the Corporation, outside advisors
are retained from time to time to represent and advise directors, as
appropriate.

BOARD MEETINGS, COMMITTEES

During the Fiscal Year the Board of Directors held twelve meetings and
committees of the Board held a total of sixteen meetings. With the exception of
The Honourable Paul Desmarais, all directors attended 75% or more of the
meetings of the Board of Directors and of the committees of the Board on which
they served during the time in which they were directors or committee members.

The Board has established four committees to assist the Board in
effectively carrying out its responsibilities. The Audit, Human Resources and
Corporate Governance Committees, described below, are each comprised entirely of
"outside" directors, a majority of which are "unrelated". In addition, the Board
has also established an Executive Committee which is comprised of seven
directors, three of whom are "unrelated", with the authority to exercise all of
the powers of the Board in the management and direction of the operations of the
Corporation, except such acts as must by law be performed by the full Board and
any matter which the full Board retains for itself. The members of the Executive
Committee are Edgar M. Bronfman, The Honourable Charles R. Bronfman, Edgar
Bronfman, Jr., The Honourable Paul Desmarais, Senator E. Leo Kolber, Robert W.
Matschullat and C. Edward Medland. All of the committees of the Board report to
the Board on a regular basis.

Corporate Governance Committee. The members of the Corporate Governance
Committee are The Honourable William G. Davis, Chairman, David L. Johnston,
Marie-Josee Kravis and John S. Weinberg, all of whom are "outside" directors and
three of whom are "unrelated". The Corporate Governance Committee met three
times during the Fiscal Year. The Committee's mandate is to develop the
Corporation's approach to governance issues and the Corporation's response to
the TSE guidelines. In furtherance of this mandate, the Committee reviews and
assesses the Corporation's procedures with respect to a wide range of governance
issues identified in the TSE guidelines.

Audit Committee. The members of the Audit Committee are C. Edward Medland,
Chairman, Matthew W. Barrett, The Honourable William G. Davis, The Honourable
Paul Desmarais and Michele J. Hooper, all of whom are "outside" directors and
four of whom are "unrelated". The Committee met six times during the Fiscal
Year. The primary responsibilities of the Committee are to review the nature and
scope of the audit and non-audit services provided by the Corporation's
independent auditors, to review the recommendations of the independent auditors
and the responses of the Corporation's management, to review internal accounting
and financial procedures of the Corporation, to review the Corporation's annual
and quarterly financial statements, to

9
<PAGE> 12

review matters in regard to the Corporation's pension plans, to review the
Corporation's risk management and insurance plans and to monitor the
Corporation's program for compliance with policies on business ethics. The Audit
Committee assesses the integrity of the Corporation's internal controls and
reviews the quality of its management information systems.

Human Resources Committee. The members of the Human Resources Committee
are Marie-Josee Kravis, Chairman, David L. Johnston, Senator E. Leo Kolber, and
John S. Weinberg, all of whom are "outside" directors and three of whom are
"unrelated". The Committee met seven times during the Fiscal Year. Its principal
functions are to supervise development of management resources, to review the
annual compensation of all officers of the Corporation and selected officers and
employees of subsidiary companies, to review the form and adequacy of the
compensation of directors, and to review all executive and director compensation
plans and major changes to existing employee benefit plans. The Committee is
also responsible for reviewing the succession plan for senior management.

COMPENSATION OF DIRECTORS

The Corporation's directors, other than those who are employees of the
Corporation, are paid $35,000 a year plus a fee of $1,500 for each Board and
committee meeting attended, and are reimbursed for travel expenses incurred in
connection therewith. Committee chairmen receive an additional $4,500 per year.
Directors who are employees of the Corporation or its subsidiaries do not
receive compensation by reason of their membership on, or attendance at meetings
of, the Board or committees thereof.

Non-employee directors receive at least 50% of their annual fees in Shares
or Share equivalents pursuant to The Seagram Company Ltd. Stock Plan for
Non-Employee Directors. Under the plan, each non-employee director may elect to
receive either 50% or 100% of his or her annual retainer in Shares or deferred
share units. If a director elects to receive Shares, the applicable retainer
amount (net of withholding taxes) will be used to purchase Shares on the open
market. The Shares will be delivered promptly to the director. If a director
elects to receive deferred share units, units representing the value of Shares
will be credited to the director's account based on the market value of a Share
on the annual crediting date. Deferred share units will be paid to the director,
along with the value of dividends as if reinvested in additional Shares, after
termination of Board service. Payment will be made in Shares or cash, net of tax
withholding, based on the then market value of the Shares. Fees for attending
Board and committee meetings and/or for serving as a Board committee chairman
may also be received in deferred share units at the election of non-employee
directors.

10
<PAGE> 13

EXECUTIVE COMPENSATION

SUMMARY COMPENSATION TABLE

The following table summarizes the compensation of the Corporation's chief
executive officer and each of the Corporation's four other most highly
compensated executive officers with respect to the Fiscal Year, the five month
transition period ended June 30,1996 and the Corporation's preceding full fiscal
year.

<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------------------
Annual Compensation Long-Term Compensation
------------------------------------------------------------------------------------
Awards Payouts
-------------------------------------------------------
Other Securities All
Annual Restricted Underlying LTIP Other
Year(1) Salary Bonus Compensation Stock Awards Options/SARs Payouts Compensation
Name and
Principal
Position ($) ($) ($) (#) (#) ($) ($)
- ---------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Edgar M.
Bronfman June 30, 1997 750,000 787,500 372,184(2) 0 80,000 0 93,380(3)
Chairman
of the
Board June 30, 1996 312,500 293,750 68,893 0 80,000 0 250(3)
of the
Corporation
and of
JES January 31, 1996 700,020 556,520 406,394 0 80,000 0 100,152(3)
- ---------------------------------------------------------------------------------------------------------------------------------
Charles R.
Bronfman June 30, 1997 600,000 630,000 0 0 69,200 0 0
Co-Chairman
of the
Board of June 30, 1996 250,000 235,000 N/A 0 69,200 0 N/A
the
Corporation
and JES and January 31, 1996 552,000 438,840 N/A 0 69,200 0 N/A
Chairman
of the
Executive
Committee
of the
Corporation
- ---------------------------------------------------------------------------------------------------------------------------------
Edgar
Bronfman,
Jr. June 30, 1997 1,000,000 3,150,000 63,440 0 0 0 17,864(3)
President
and Chief
Executive June 30, 1996 416,675 1,175,000 0 0 1,000,000 0 0
Officer of
the
Corporation January 31, 1996 902,700 731,720 88,384 0 0 0 17,487(3)
and of JES
- ---------------------------------------------------------------------------------------------------------------------------------
Robert W.
Matschullat June 30, 1997 795,840 1,000,000 6,674 0 150,000 0 1,125(3)
Vice
Chairman and June 30, 1996 312,500 312,500 0 0 0 0 188(3)
Chief
Financial
Officer of January 31, 1996 250,000 250,000 0 66,500(5) 445,500 0 1,188(3)
the
Corporation
and of
JES(4)
- ---------------------------------------------------------------------------------------------------------------------------------
Frank J.
Biondi,
Jr. June 30, 1997 1,000,000 5,850,000 477,832(7) 0 200,000 0 314,426(8)
Chairman
and Chief
Executive June 30, 1996 189,744 853,846 0 0 1,500,000 0 56,712
Officer of
Universal(6)
- ---------------------------------------------------------------------------------------------------------------------------------
</TABLE>

(1) The Corporation changed its fiscal year end to June 30, effective June 30,
1996. The table reflects information for the fiscal year ended June 30,
1997, the five month transition period ended June 30, 1996 and the preceding
full fiscal year ended January 31, 1996.

(2) Other Annual Compensation for the Fiscal Year includes $77,633 for financial
counseling services and $63,000 which represents the current dollar value of
the insurance premiums paid to provide surviving spouse retirement benefits.

(3) Reflects the aggregate value of the contributions by the Corporation's
subsidiaries under the Retirement Savings and Investment Plan for Employees
of Joseph E. Seagram & Sons, Inc. and Affiliates and the current dollar
value benefit of the premiums paid under the JES Insurance and Salary
Continuation Programs.

(4) Mr. Matschullat became Vice Chairman and Chief Financial Officer of the
Corporation and of JES on October 1, 1995.

(5) On October 1, 1995, JES awarded Mr. Matschullat a special one-time grant of
100,000 Shares, 66,500 of which were subject to certain restrictions
("Restricted Shares"). Restrictions on 33,250 of these Shares lapsed on
October 1, 1996. As of June 30, 1997, the remaining 33,250 Restricted Shares
had a market value of $1,338,313. Restrictions on the Restricted Shares will
lapse on October 1, 1997. Mr. Matschullat is entitled to receive any
dividends declared upon the Restricted Shares.

(6) Mr. Biondi became Chairman and Chief Executive Officer of Universal on April
23, 1996.

(7) Other Annual Compensation for the Fiscal Year includes reimbursements of
$380,454 pursuant to Universal's relocation program.

(8) All Other Compensation for the Fiscal Year includes $300,000 of deferred
compensation paid pursuant to Mr. Biondi's employment agreement with
Universal and $14,426 contributed by Universal to the Universal Studios,
Inc. Profit Sharing Trust.

11
<PAGE> 14

OPTION/SAR GRANTS IN FISCAL YEAR

<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------
Potential Realizable Value
Number of at Assumed Annual Rates
Securities % of Total of Stock Price Appreciation
Underlying Options/SARs Exercise for Option Term
Options/SARs Granted to or Base ---------------------------------------
Granted Employees in Price Expiration 5% 10%
Name (#) Fiscal Year ($) Date ($) ($)
0%
($)
- -------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Edgar M. Bronfman 80,000 (1) 1% 39.50 May 4, 2007 0 1,987,292 5,036,218
- -------------------------------------------------------------------------------------------------------------------------------
Charles R. Bronfman 69,200 (1) 1% 39.50 May 4, 2007 0 1,719,008 4,356,329
- -------------------------------------------------------------------------------------------------------------------------------
Edgar Bronfman, Jr. 0 N/A N/A N/A N/A N/A N/A
- -------------------------------------------------------------------------------------------------------------------------------
Robert W. Matschullat 150,000 (2) 2% 39.50 May 4, 2007 0 3,726,173 9,442,910
- -------------------------------------------------------------------------------------------------------------------------------
Frank J. Biondi, Jr. 200,000 (3) 3% 33.5625 June 30, 2006 0 4,221,424 10,697,980
- -------------------------------------------------------------------------------------------------------------------------------
All Shareholders (4) 0 9,246,286,408 23,432,041,374
- -------------------------------------------------------------------------------------------------------------------------------
Gain to Named Executive Officers as a Percentage of Gain to all Shareholders 0% 0.13% 0.13%
- -------------------------------------------------------------------------------------------------------------------------------
</TABLE>

(1) Options to purchase Shares which were granted on May 5, 1997 and become
exercisable in equal installments over a three-year period beginning on the
first anniversary of the date of grant.

(2) Options to purchase Shares which were granted on May 5, 1997, 100,000 of
which become exercisable on May 5, 1998, and the remainder of which become
exercisable in equal installments on May 5, 1999 and May 5, 2000.

(3) Options to purchase Shares which were granted on July 1, 1996 and became
exercisable on July 1, 1997.

(4) The potential realizable gain to all shareholders is calculated based on
365,280,735 Shares outstanding and a fair market value of $40.25 per Share
on June 30, 1997.

AGGREGATED OPTION/SAR EXERCISES IN FISCAL YEAR AND
FISCAL YEAR-END OPTION/SAR VALUES

<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------
NUMBER OF SECURITIES VALUE OF UNEXERCISED
UNDERLYING UNEXERCISED IN-THE-MONEY
SHARES OPTIONS/SARS AT OPTIONS/SARS AT
ACQUIRED ON VALUE FISCAL YEAR-END FISCAL YEAR-END
EXERCISE REALIZED EXERCISABLE/UNEXERCISABLE EXERCISABLE/UNEXERCISABLE
NAME (#) ($) (#) ($)
- -----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Edgar M. Bronfman 0 0 831,787/133,333 14,062,673/426,664
- -----------------------------------------------------------------------------------------------------
Charles R. Bronfman 0 0 408,767/115,333 4,972,903/369,064
- -----------------------------------------------------------------------------------------------------
Edgar Bronfman, Jr. 0 0 2,285,600/1,400,000 26,963,375/9,975,000
- -----------------------------------------------------------------------------------------------------
Robert W.
Matschullat 0 0 345,500/250,000 1,576,344/568,750
- -----------------------------------------------------------------------------------------------------
Frank J. Biondi, Jr. 0 0 300,000/1,400,000 1,325,000/6,637,500
- -----------------------------------------------------------------------------------------------------
</TABLE>

12
<PAGE> 15

PENSION, BENEFIT EQUALIZATION, SALARY CONTINUATION AND SEVERANCE PLANS

JES maintains a pension plan for employees (including Edgar M. Bronfman,
Edgar Bronfman, Jr., Robert W. Matschullat and other officers) of JES and its
U.S. subsidiaries. Benefits under this plan are based upon salary as reported in
the "Summary Compensation Table", and are subject to statutory limitations as to
maximum amounts payable. A separate benefit equalization plan provides for
additional payments on an unfunded basis with respect to awards payable under
the Management Incentive Plan of JES and amounts in excess of statutory
limitations for certain senior executives of JES, including Edgar M. Bronfman,
Edgar Bronfman, Jr. and Robert W. Matschullat. The benefit equalization plan
also grants to participating senior executive employees credit for one year of
additional service (up to a maximum of 15 years) for each year of actual
service, up to a combined aggregate of 35 years of service (up to 40 years under
certain circumstances), provided that such employees have attained the age of 65
(or earlier under certain circumstances) and have accumulated at least ten years
of service for purposes of the pension plan. The estimated annual pension
benefits (calculated on a straight-life basis) payable on retirement to eligible
employees at or after age 65 under the plans as currently in effect at an
assumed average covered compensation during any five years of the last ten years
of employment in which the covered compensation was the highest are shown below.

PENSION PLAN TABLE
- --------------------------------------------------------------------------------

<TABLE>
<CAPTION>
Annual pension for representative
years of continuous service
Five-year average -------------------------------------------------------------
final compensation 5 10 20 30 40
<S> <C> <C> <C> <C> <C>
</TABLE>

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

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

At June 30, 1997, Edgar M. Bronfman was credited with 40 years (the maximum
years permitted under the plans), Edgar Bronfman, Jr., was credited with 15
years and Robert W. Matschullat was credited with one year for purposes of the
plans. JES has agreed with Robert W. Matschullat that upon his retirement he
will receive a minimum annual pension benefit of $30,000 multiplied by the
number of years (or portions thereof) of his service to the Corporation.

JES maintains a program which provides retirement salary continuation
benefits for Edgar M. Bronfman and Edgar Bronfman, Jr. and certain other
executives of JES. If the participant retires after the age of 55 with ten or
more years of service, he will receive an amount payable annually for ten years
of up to 35% of the sum of his base salary in the last year of employment plus
the highest management incentive award previously received. Effective as of
1988, there will be no new participants in the salary continuation program and,
subject to the terms of such program, existing participants will receive
payments based on their compensation levels at January 31, 1988.

Joseph E. Seagram & Sons, Limited ("JES Limited"), a Canadian subsidiary of
the Corporation, maintains registered pension, unfunded pension and
post-retirement consulting plans for certain of the Corporation's executive
employees, including Charles R. Bronfman. These plans are substantially
equivalent to the pension, benefit equalization and retirement salary
continuation plans of JES. The estimated aggregate annual pension benefits
payable at normal retirement age, at or after age 60, under the registered and
unfunded plans as currently in effect at an assumed average salary and cash
bonus during any five years of the last ten years of employment in which the
compensation was the highest are shown below.

13
<PAGE> 16

PENSION PLAN TABLE

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

<TABLE>
<CAPTION>
Annual pension for representative
years of continuous service
Five-year average ------------------------------------------------------------
final compensation 10 20 30 40 45
<S> <C> <C> <C> <C> <C>
</TABLE>

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

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

At June 30, 1997, Charles R. Bronfman was credited with 45 years of service
for purposes of the plans.

JES maintains a severance pay plan (the "Severance Pay Plan") for certain
non-union employees of JES and certain of its U.S. subsidiaries, including Edgar
M. Bronfman, Edgar Bronfman, Jr. and Robert W. Matschullat. The named executive
officers are entitled to receive benefits under the Severance Pay Plan only if
their employment is terminated due to a permanent and complete closing of a
location, a job elimination, or a failure to consistently perform at a level
that meets minimum acceptable requirements. The Severance Pay Plan provides
benefits to eligible employees equal to a certain portion of their annual rate
of base salary for each year of service, subject to a maximum amount. The
maximum period of time over which benefits may be provided under the Severance
Pay Plan is 24 months.

EMPLOYMENT AND CONSULTING AGREEMENTS

In connection with his appointment as Vice Chairman and Chief Financial
Officer and a director of the Corporation and JES on October 1, 1995, Robert W.
Matschullat and JES entered into an employment agreement dated July 31, 1995
which provides that Mr. Matschullat is paid an annual salary of $750,000,
subject to upward adjustment in JES's discretion on each July 1 (provided that
the increase shall be at least 5% of his then current salary), and participates
in all benefit plans and arrangements generally applicable to the Corporation's
senior executives, provided that he is to receive an incentive bonus with
respect to each fiscal year of the Corporation through June 30, 1998, in an
amount not less than the salary paid in respect of such fiscal year, to receive
in each calendar year commencing 1997, ten-year options (which become
exercisable after one year) to purchase at least 100,000 Shares at the fair
market value of such Shares on the date of grant and to receive pension benefits
described above under "Pension, Benefit Equalization, Salary Continuation and
Severance Plans". On October 1, 1995, Mr. Matschullat was awarded (i) ten-year
options to purchase 145,500 Shares and (ii) a special one-time grant of ten-year
options to purchase 300,000 Shares (of which 200,000 options are exercisable as
of the date hereof and of which 100,000 become exercisable on October 1, 1997 or
upon his earlier death or disability), in each case at the fair market value of
the Shares on the date of grant. On October 1, 1995, Mr. Matschullat was also
awarded a special one-time grant of 100,000 Shares, 33,250 of which (the
"Restricted Shares") are subject to forfeiture if Mr. Matschullat's employment
with JES is terminated by JES for cause or by Mr. Matschullat without good
reason. All transfer and other restrictions will lapse as to all remaining
Restricted Shares, plus any equity securities of the Corporation issued with
respect thereto, on October 1, 1997 or, if earlier, upon Mr. Matschullat's death
or disability or the termination of his employment by JES without cause or by
him with good reason. Mr. Matschullat is entitled to receive dividends upon and
vote the Restricted Shares. If Mr. Matschullat's employment with JES is
terminated by him with good reason or by JES without cause, Mr. Matschullat is
entitled to receive (i) a payment equal to all accrued salary and bonus amounts
for any completed fiscal year, two times his then annual salary and two times
the greater of his then target bonus under the Management Incentive Plan of JES
(which must be no less than 90% of his then salary) and his minimum bonus; (ii)
continued medical, dental and life insurance coverage under the JES Senior
Executive Benefits Program until the earlier of two years following the date of
termination or his eligibility for coverage with another employer; and (iii)
full vesting of all options then held by Mr. Matschullat.

In connection with his appointment as Chairman and Chief Executive Officer
of Universal on April 23, 1996, Frank J. Biondi, Jr., Universal and the
Corporation entered into an employment agreement dated as of such date with a
term ending on June 30, 2001 which provides that Mr. Biondi is paid an annual
salary of $1,000,000 and

14
<PAGE> 17

participates in all benefit plans and arrangements and certain medical, life
insurance and auto plans available to Universal executives. Pursuant to the
Senior Executive Short-Term Incentive Plan ("STIP"), Mr. Biondi has the
opportunity to earn an annual cash incentive bonus for each fiscal year
commencing on or after July 1, 1996 targeted at $4,500,000, adjusted for
inflation in future years, up to a maximum of twice the initial target, if and
to the extent applicable Universal performance targets are met. Mr. Biondi will
receive deferred annual compensation for each year in an amount equal to his
previous year's salary and deferred compensation, adjusted for inflation, less
$1,000,000, with such deferred compensation to be paid in January of the first
calendar year following the fiscal year in which Mr. Biondi ceases to be an
executive officer of Universal. Mr. Biondi will receive annual grants of ten-
year options (which become exercisable after one year) to purchase 200,000
Shares at the fair market value of such Shares on the date of grant. On April
23, 1996, Mr. Biondi was awarded a special one-time grant of ten-year options to
purchase 1,000,000 Shares at their fair market value on the date of grant and
options to purchase 500,000 Shares at 140% of such fair market value, which
options become exercisable in five equal annual installments commencing on April
23, 1997.

If Mr. Biondi's employment with Universal is terminated by him with good
reason, including the diminution of the Corporation's ownership of Universal
below specified levels or the sale of substantially all of Universal's income
producing assets or property, or by Universal without cause, Mr. Biondi's
options will become exercisable in full and Mr. Biondi will be entitled to
receive (i) salary, deferred compensation and target bonus payments for the
longer of two years from such termination date or the expiration of the term of
his employment agreement, (ii) a cash payment of between $5,000,000 and
$15,000,000 depending upon when such termination occurs, and (iii) continuation
of medical, dental and insurance coverage until the earlier of the conclusion of
the continuation period or his eligibility for coverage with another employer,
with life insurance coverage maintained until June 30, 2001. If Mr. Biondi's
employment terminates by reason of his death during the term of his employment
agreement, Mr. Biondi's beneficiary is entitled to receive salary, deferred
compensation and target bonus payments for the shorter of one year from such
date or the remainder of the term of his employment agreement. If Mr. Biondi's
employment is terminated by reason of his permanent disability, he is generally
entitled to receive (i) salary, deferred compensation and target bonus payments
continuing for the shorter of two years from such date or the remainder of the
term of his employment agreement, and (ii) 60% of salary until the earlier of
his attainment of age 65 or the end of his permanent disability, in either case,
as reduced by the amount of any other benefits otherwise payable to Mr. Biondi
in connection therewith. With respect to any of the payments described herein,
if such payments would result in the imposition of an excise tax upon Mr. Biondi
under Section 4999 of the United States Internal Revenue Code ("Code"), Mr.
Biondi shall also receive a cash payment equal to the sum of such excise taxes
due by reason of such payments, plus any amount necessary to place Mr. Biondi in
the same after-tax position as if no such excise taxes had been imposed. In
addition, Universal will provide him with a $10,000,000 life insurance benefit
during the term of the agreement. The agreement also restricts Mr. Biondi's
ability to interfere with the businesses of Universal, its subsidiaries and
affiliates for two years following the termination of his employment and, in the
event his employment is terminated by Universal for cause, by him without good
reason or due to his permanent disability, his ability to compete with such
entities for the lesser of one year following such termination or the remainder
of the term of his employment agreement.

During the Fiscal Year, the Corporation paid Lew R. Wasserman, a director
of the Corporation and former Chairman and Chief Executive Officer of Universal,
consulting fees in the amount of $1,000,000 pursuant to the terms of his
employment agreement with Universal dated as of December 6, 1988, as amended.
Pursuant to such agreement, Mr. Wasserman became a consultant and advisor to
Universal on an exclusive basis effective January 4, 1996 at an annual fee of
$1,000,000 and will serve in that capacity until his death or his election to
terminate such relationship. Under the terms of the agreement, Mr. Wasserman
participated, and while he serves as a consultant will continue to participate,
in benefit plans generally available to Universal employees and certain medical,
life insurance and auto plans available to Universal executives.

15
<PAGE> 18

REPORT ON EXECUTIVE COMPENSATION

The Human Resources Committee of the Board of Directors (the "Committee"),
which consists of directors who are not employed by the Corporation, has
furnished the following report on executive compensation:

Compensation for executive officers consists primarily of three components:
salary, annual incentive compensation and stock-based compensation. The general
guidelines used by the Corporation to determine the levels of these components
are described below. It should be noted, however, that the compensation of
certain executive officers is governed by the terms of employment agreements,
certain of which are described above under "Employment and Consulting
Agreements".

The Corporation annually reviews compensation data from surveys conducted
by independent compensation consultants relating to approximately 30 companies
consisting primarily of Fortune 500 and similar international companies in the
food, beverage and consumer products industries and, in the case of the CEO, a
group of 11 Fortune 500 and similar international consumer product and
entertainment companies (the "Comparison Group"). The new peer group included in
the performance graph on page 18 consists of companies of varying sizes engaged
in the beverage alcohol, food and entertainment businesses, some of which are
included in the Comparison Group. The Committee believes that the Comparison
Group more accurately reflects the Corporation's competitors for executive
talent. Based on its review of the Compensation data, the Committee determines
the various components of executive compensation for each executive officer. A
subcommittee consisting of Marie-Josee Kravis and David L. Johnston (the
"Subcommittee") makes awards under and administers the STIP and 1992 and 1996
Stock Incentive Plans described below.

Salary. Salaries for executive officers are generally maintained at
competitive levels within relevant labor markets and are reviewed annually to
maintain a competitive position. In respect of the Fiscal Year, the Corporation
targeted base salaries in the third quartile paid by members of the Comparison
Group for similar positions. Salary was determined for each executive based on
the executive's responsibilities, skills and sustained performance.

Annual Incentive Compensation. Annual incentive awards are paid to
participating executive officers under either the STIP or the Management
Incentive Plan ("MIP") of JES. For the Fiscal Year, the Subcommittee established
target awards under the STIP based upon the Corporation or applicable operating
unit achieving prescribed objectives for earnings before interest, taxes,
depreciation and amortization ("EBITDA"). Target awards under the MIP were based
upon the Corporation and any applicable operating unit achieving prescribed
objectives for EBITDA and Seagram Value Added (defined as EBITDA in excess of
capital cost). Under the plans, target annual incentive awards for executive
officers ranged from approximately 40% to 450% of salary in effect for the
Fiscal Year. Annual incentive awards for executive officers generally were
targeted at levels such that if targets were achieved, incentive awards in
combination with salary would result in executive officers earning cash
compensation at approximately the 75th percentile paid by members of the
Comparison Group for similar positions. Awards under the STIP can be reduced by
the Subcommittee for any reason including its assessment of individual
performance or of the financial performance of the Corporation or its operating
units. MIP awards may be reduced or increased based on an assessment of the
individual executive's performance. Actual awards were determined at the end of
the Fiscal Year and ranged from 95% to 130% of targets based on the actual
performance of the Corporation or the applicable operating unit as well as on
the individual executive's performance. Executives may elect to receive their
MIP awards in the form of cash, stock units or stock appreciation rights and may
defer the payment of cash awards.

Stock-Based Compensation. The Corporation's 1992 and 1996 Stock Incentive
Plans provide an opportunity for participating executive officers and other
participating employees to benefit from the appreciation in the value of the
Shares. Options are an important element of the total compensation program.

Since the exercise price of an option granted under the Plans cannot be
less than the fair market value of a Share on the date of grant, options produce
value for recipients only if the price of Shares increases relative to the price
on the grant date. Options generally are granted to executive officers annually,
have ten year terms (subject to early termination in certain circumstances) and
generally have three-year vesting periods (subject to acceleration in certain
circumstances), although these plans provide the Subcommittee with the
flexibility to grant options with different vesting periods. Generally, the
number of options granted to executive officers annually is determined so that
the aggregate value of base salary, targeted short-term incentive awards and
stock option grants would approximate the 75th percentile of the aggregate value
of base salary, annual bonus and stock option grants for similar positions at
companies in the Comparison Group. For this purpose, stock options are valued
using a variant

16
<PAGE> 19

of the Black-Scholes option pricing model. In granting options annually, the
amount and terms of outstanding options held by executive officers generally are
not taken into account.

Compensation for the Chief Executive Officer. For the Fiscal Year, the base
salary for Edgar Bronfman, Jr. remained at $1,000,000 and his target annual
incentive was set at 300% of salary. Mr. Bronfman was awarded 105% of his target
annual incentive under the STIP for the Fiscal Year. Mr. Bronfman's salary is
between the median and the 75th percentile of salary paid by members of the
Comparison Group. Including his bonus, Mr. Bronfman's total cash compensation
approximates the 75th percentile of total cash compensation for chief executive
officers of the Comparison Group.

In 1993 the Committee approved a five-year equity-based compensation
program for Mr. Bronfman consisting of (i) an initial grant of stock options and
(ii) annual grants of stock appreciation rights ("SARs") to the extent the
return on the Shares exceeds the return on the shares included in the Standard &
Poor's 500 Composite Index (the "S&P 500"). At the end of each twelve-month
period commencing with the period ended January 31, 1995, the Subcommittee
compares the appreciation in the value of the Shares from February 1, 1994 to
the end of such twelve-month period to the appreciation in the value of the S&P
500 for the same period. For every basis point by which the appreciation in the
value of the Shares exceeds the appreciation in the value of the S&P 500 for
such period, the Subcommittee intends to grant Mr. Bronfman 1,000 SARs, although
the Subcommittee has retained the discretion to increase or decrease any grant
if unanticipated events occur. The SARs will be exercisable for cash, will
terminate ten years from the date of grant and will have an exercise price equal
to the fair market value of Shares on the date of grant. The SAR program did not
result in any SAR grants during the Fiscal Year.

Section 162(m) of the Internal Revenue Code. Section 162(m) of the Code
limits the deductibility of certain types of compensation in excess of $1
million paid to persons named in the Summary Compensation Table. The Corporation
believes that compensation paid under the STIP and awards of stock options under
the 1992 and 1996 Stock Incentive Plans satisfy the requirements of 162(m).
However, Section 162(m) may limit JES' ability to deduct some other types of
compensation paid to individuals named in the Summary Compensation Table. The
Committee believes it should maintain the flexibility to design compensation
strategies that can respond quickly to marketplace and the Corporation's needs
even if such compensation is not fully deductible.

HUMAN RESOURCES COMMITTEE

Marie-Josee Kravis, Chairman
David L. Johnston
Senator E. Leo Kolber
John S. Weinberg

17
<PAGE> 20

PERFORMANCE GRAPHS

The following graph compares the cumulative five-year total return of the
Corporation's Shares with the S&P 500, the Toronto Stock Exchange 300 Composite
Index ("TSE 300") and a new peer group. In light of the Corporation's investment
in Universal, the Corporation added certain companies which compete with its
entertainment business to the new peer group. The new peer group is comprised of
companies included in the S&P Beverages (Alcoholic) Index together with certain
non-U.S. competitors that compete with the Corporation's beverage alcohol
business, companies included in the S&P Foods Index, and certain entertainment
companies that compete with the Corporation's entertainment business. The
returns of each company have been weighted according to their respective market
capitalization as well as the respective revenues from the Corporation's
beverage alcohol, juice and entertainment businesses.

The performance graph assumes that $100 was invested on June 30, 1992 in
the Shares, the S&P 500, the TSE 300 and the new peer group and that all
dividends were reinvested.

COMPARISON OF FIVE-YEAR CUMULATIVE TOTAL RETURN
AMONG THE CORPORATION, S&P 500, TSE 300 AND NEW PEER GROUP
(TWELVE MONTHS ENDED JUNE 30)

<TABLE>
<CAPTION>
MEASUREMENT PERIOD
(FISCAL YEAR COVERED) SEAGRAM S&P 500 TSE 300 NEW PEER GROUP
<S> <C> <C> <C> <C>
1992 100 100 100 100
1993 96 114 121 94
1994 113 115 126 97
1995 132 145 145 111
1996 130 183 165 124
1997 159 246 214 152
</TABLE>

18
<PAGE> 21

Pursuant to the SEC's rules, the performance of the Corporation's old peer
group is set forth in the graph below for comparative purposes. The performance
of the old peer group will not be provided in the future. The old peer group is
comprised of companies included in the S&P Beverages (Alcoholic) Index, the S&P
Foods Index and certain non-U.S. competitors that compete with the Corporation's
beverage alcohol business. The returns of each company have been weighted
according to their respective market capitalization as well as the respective
revenues from the Corporation's beverage alcohol and juice businesses.

COMPARISON OF FIVE-YEAR CUMULATIVE TOTAL RETURN
BETWEEN THE CORPORATION AND OLD PEER GROUP
(TWELVE MONTHS ENDED JUNE 30)

<TABLE>
<CAPTION>
MEASUREMENT PERIOD
(FISCAL YEAR COVERED) SEAGRAM OLD PEER GROUP
<S> <C> <C>
1992 100 100
1993 96 95
1994 113 97
1995 132 111
1996 130 125
1997 159 160
</TABLE>

In addition to the Corporation, the new peer group is comprised of Adolph
Coors Company, Allied Domecq PLC, Anheuser-Busch Companies, Inc., Brown-Forman
Corporation, Campbell Soup Company, ConAgra, Inc., CPC International, Inc., The
Walt Disney Company, General Mills, Inc., Grand Metropolitan PLC, Guinness PLC,
H.J. Heinz Company, Hershey Foods Corporation, Kellogg Company, The News
Corporation Limited, The Quaker Oats Company, Ralston Purina Company, Sara Lee
Corporation, Time Warner Inc., Unilever N.V., Viacom Inc. and W.M. Wrigley Jr.,
Co. The old peer group is comprised of the same companies as the new peer group
except that it excludes the four entertainment companies: The Walt Disney
Company, The News Corporation Limited, Time Warner Inc. and Viacom Inc. The old
peer group also includes the Archer-Daniels Midland Company because it was part
of the S&P Foods Index at the time of the Corporation's last proxy circular.

19
<PAGE> 22

HUMAN RESOURCES COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION

The Human Resources Committee is comprised of four "outside" directors,
David L. Johnston, Senator E. Leo Kolber, Marie-Josee Kravis and John S.
Weinberg. Certain information with respect to entities with which certain of
such members are related is set forth below.

As of August 31, 1997, Universal held an approximately 42% equity interest
in Cineplex Odeon Corporation ("Cineplex Odeon"). Pursuant to film distribution
and exhibition agreements entered into in accordance with normal business terms
and conditions, Universal receives film licensing fees from Cineplex Odeon and
pays Cineplex Odeon distribution fees. As of August 31, 1997, the CRBFT and
Charles R. Bronfman, collectively, held an approximately 22% equity interest in
Cineplex Odeon. Senator E. Leo Kolber, a director of the Corporation, is a
director and the Chairman of the Board of Cineplex Odeon and as of August 31,
1997 held an approximately 2% equity interest in Cineplex Odeon.

Goldman, Sachs & Co. from time to time performs investment banking services
and provides investment advice for the Corporation and its subsidiaries,
including acting as a dealer in the sale of commercial paper issued by JES, as a
market maker in certain securities of JES, as a broker in connection with
purchases of Shares for cancellation by the Corporation, and as managing
underwriter or participating underwriter in connection with the sale of
securities. John S. Weinberg, a director of the Corporation, is a General
Partner of Goldman, Sachs & Co.

TRANSACTIONS WITH DIRECTORS AND OTHERS

During the Fiscal Year, Claridge Inc. ("Claridge") reimbursed a subsidiary
of the Corporation for use of aircraft owned by such subsidiary in the amount of
$36,183, representing Claridge's pro rata share of all applicable operating
expenses. The CRBFT owns all of the shares of Claridge. Charles R. Bronfman and
Arnold M. Ludwick are among the directors and officers of Claridge.

During the Fiscal Year, the Corporation paid or accrued rent and reimbursed
expenses to Claridge in the amount of Cdn. $604,889 (and Cdn. $56,954 during the
current fiscal year to August 31, 1997) with respect to use by the Corporation
of office and parking space and secretarial services.

Bank of Montreal extends credit and provides other services to the
Corporation and its subsidiaries from time to time, including serving as a
co-agent and lender pursuant to several credit agreements with the Corporation
and its subsidiaries, acting as an issuing agent and broker for commercial paper
of the Corporation and providing cash management and other services to the
Corporation and certain of its subsidiaries. Matthew W. Barrett, a director of
the Corporation, is Chairman and Chief Executive Officer of Bank of Montreal.

During the Fiscal Year, JES paid or accrued consulting fees in the amount
of $75,000 (and $12,500 during the current fiscal year to August 31, 1997) with
respect to consulting services provided to JES and its affiliates by Henry
Consultants Ltd., a company which is beneficially owned by Frank Alcock, the
father-in-law of Edgar Bronfman, Jr.

During the Fiscal Year, Universal paid or accrued approximately $238,828
(and $276,544 during the current fiscal year to August 31, 1997) in expenses
relating to the construction of a motion picture screening room at Mr. Biondi's
residence in Los Angeles, California. The screening room will be owned by the
Corporation which will be responsible for the operating costs including
insurance, maintenance and property taxes. Should Mr. Biondi no longer be
associated or affiliated with the Corporation, or if he sells his residence, the
Corporation will remove the screening room and restore the property. If Mr.
Biondi desires to retain the screening room, he has the option to purchase the
screening room for the depreciated book value of the construction costs and the
projection equipment and furnishings for their depreciated book value.

The Corporation considers the amounts paid or received with respect to the
various transactions discussed above and under "Human Resources Committee
Interlocks and Insider Participation" to be reasonable and competitive and
believes they are comparable to those which would have been paid to or received
from others.

The Corporation maintains directors' and officers' liability insurance
whereby the directors and officers of the Corporation and its subsidiaries are
insured against certain defined losses from claims against them in their
capacities as directors and officers for defined wrongful acts. The policy
covers amounts which directors and officers become obligated to pay for defined
losses up to a stipulated limit in a policy year. The aggregate limit is
$25,000,000 at an annual premium of $420,000, which was paid in respect of the
policy year which extends until October 1997. The Corporation's deductible is
$500,000.

20
<PAGE> 23

APPOINTMENT OF AUDITORS

The persons named in the enclosed proxy, unless otherwise directed by the
shareholder appointing them, intend to vote at the Meeting for the reappointment
of Price Waterhouse LLP as auditors of the Corporation to hold office until the
close of the next annual meeting of shareholders and to authorize the Board of
Directors to set their remuneration. Price Waterhouse LLP have been auditors of
the Corporation for many years. Representatives of Price Waterhouse LLP are
expected to be present at the Meeting and will have the opportunity to make a
statement, if they desire to do so, and will be available to respond to
appropriate questions from the shareholders.

REPORT OF DIRECTORS AND FINANCIAL STATEMENTS

Pursuant to the requirements of the Canada Business Corporations Act, the
directors will place before the shareholders at the Meeting their Report and the
comparative Consolidated Financial Statements of the Corporation for the Fiscal
Year but no action with respect thereto is required or proposed to be taken by
the shareholders.

AVAILABILITY OF DISCLOSURE DOCUMENTS

The Corporation will provide to any person or company, upon request to the
Secretary of the Corporation, a copy of: (i) the latest Annual Information Form
or Annual Report on Form 10-K of the Corporation, together with one copy of any
document, or the pertinent pages of any document, incorporated therein by
reference; (ii) the comparative Consolidated Financial Statements of the
Corporation for the Fiscal Year, together with the report thereon of its
auditors and any interim financial statements of the Corporation filed with the
securities commissions of any province of Canada subsequent thereto; and (iii)
the Proxy Circular of the Corporation for the Meeting.

PROCEDURE FOR SUBMITTING SHAREHOLDER PROPOSALS

Shareholders who wish to present proposals for action at the next annual
meeting of shareholders should submit their proposals in writing to the
Secretary of the Corporation at the address of the Corporation set forth on the
first page of this Proxy Circular so that the same are received by the Secretary
no later than August 7, 1998 for inclusion in the next Proxy Circular.

GENERAL

The contents and the sending of this Proxy Circular have been approved by
resolution of the Board of Directors of the Corporation.

Montreal, Quebec, August 31, 1997

/s/Michael C. L. Hallows
----------------------
MICHAEL C. L. HALLOWS
Secretary

21
<PAGE> 24

THE SEAGRAM COMPANY LTD.

THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF THE SEAGRAM
COMPANY LTD. (THE "CORPORATION") FOR THE ANNUAL MEETING OF SHAREHOLDERS OF THE
CORPORATION TO BE HELD NOVEMBER 5, 1997, and should be read in conjunction with
the Notice of Meeting and Proxy Circular pertaining thereto.

The undersigned shareholder hereby appoints Edgar M. Bronfman, Chairman, The
Hon. Charles R. Bronfman, Co-Chairman, Edgar Bronfman, Jr., President and Chief
Executive Officer, and Robert W. Matschullat, Vice Chairman and Chief Financial
Officer, or any one of them, OR INSTEAD OF ANY OF THEM THE UNDERSIGNED HEREBY
APPOINTS

attorney or attorneys, or proxy or proxies, with full power of substitution, in
the name and on behalf of the undersigned, to attend, vote and act at the Annual
Meeting of Shareholders to be held on November 5, 1997, at The Queen Elizabeth
Hotel, 900 Rene-Levesque Boulevard West, Montreal, Quebec, and at any and all
adjournments thereof, upon the following matters:
<TABLE>
<C> <C> <C> <S> <C>
- ---------------------------------------------------------------------------------------------------------------------------
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR
- ---------------------------------------------------------------------------------------------------------------------------
a) Election of Directors
Edgar M. Bronfman, The Hon. Charles R. Bronfman, Edgar Bronfman, Jr., Samuel Bronfman II, Matthew W. Barrett, Laurent
Beaudoin, Frank J. Biondi, Jr., Richard H. Brown, The Hon. William G. Davis, Andre Desmarais, Michele J. Hooper,
David L. Johnston, Senator E. Leo Kolber, Marie-Josee Kravis, Robert W. Matschullat, C. Edward Medland, Lew R. Wasserman
and John S. Weinberg.

FOR WITHHELD FOR, except vote withheld from the following nominee(s)
------------------------------------------------------
[ ] [ ]
b) Appointment of Price Waterhouse LLP as Auditors

FOR WITHHELD
[ ] [ ]
c) In their discretion, with respect to amendments or upon variations to matters identified above or upon such other
matters as may properly come before the Meeting, hereby
revoking any proxy previously given.
- ---------------------------------------------------------------------------------------------------------------------------
</TABLE>

A SHAREHOLDER DESIRING TO APPOINT SOME OTHER PERSON, WHO NEED NOT BE A
SHAREHOLDER, TO REPRESENT HIM AT THE MEETING MAY DO SO by inserting such other
person's name in the space provided above.

This proxy, when properly executed, will be voted in accordance with the
directions of the undersigned shareholder. IN THE ABSENCE OF SUCH DIRECTIONS,
THIS PROXY WILL BE VOTED FOR ALL NOMINEES LISTED ABOVE, AND FOR THE APPOINTMENT
OF AUDITORS.

NOTE: When signing as attorney, executor, administrator, trustee, authorized
officer of a corporation or in any representative capacity, please insert your
title as such.

<TABLE>
<S> <C> <C>
Dated.......................... 1997 ............................................................
Signature of Shareholder
</TABLE>

(If not dated, this proxy is deemed to bear the date when mailed by the
Corporation.)

PROXY
PLEASE COMPLETE AND RETURN IN THE
ENVELOPE PROVIDED.
LOGO

ACCOUNT NO. SHARES