EXHIBIT 10.1
Execution Copy
Triarc Companies, Inc.
280 Park Avenue
New York, New York 10017
August 10, 2007
Brian L. Schorr
c/o Trian Fund Management, L.P.
280 Park Avenue
New York, New York 10017
Dear Mr. Schorr:
This letter agreement confirms the arrangement between you and Triarc Companies,
Inc., a Delaware corporation ("Triarc"), regarding the termination of the
Employment Agreement between you and Triarc, dated as of February 24, 2000, as
amended through the date hereof (the "Employment Agreement"), and the cessation
of your employment thereunder. Capitalized terms not otherwise defined herein
shall have the meanings set forth in the Employment Agreement.
1. Your services as an officer and employee of Triarc and any of its
direct and indirect subsidiaries, ceased effective as of 12:00 a.m.
Eastern Daylight Time on June 30, 2007 (the "Termination Date"), at
which time the Employment Agreement terminated and no longer has any
legal effect; provided, however, that the provisions of Section 4.5
(as amended herein), Section 3.6, Section 4.7, Section 4.8, Section 5,
Section 6, Section 7, Section 8 (as amended herein), Section 9,
Section 10, Section 11 and Section 12 (as amended herein) of the
Employment Agreement shall remain in effect pursuant to their terms
(and you acknowledge the receipt of sufficient consideration from
Triarc to support the continued applicability of all restrictive
covenants). The terms of Section 8 of the Employment Agreement shall
also apply with respect to services provided by you to Triarc under
the Services Agreement dated April 30, 2007, as amended, restated or
supplemented and any successor agreement thereto (the "Services
Agreement"), between Triarc and Trian Fund Management, L.P. ("Trian").
The terms of the separate indemnification agreement entered into
between you and Triarc, dated as of January 1, 1999, shall also
continue with respect to your employment prior to the Termination Date
as well as with respect to services provided by you to Triarc and its
subsidiaries under the Services Agreement. For the avoidance of doubt,
any indemnity provisions, D&O insurance, fiduciary insurance and
employed lawyers liability insurance coverage related to your
employment by Triarc and your provision of services under the Services
Agreement shall continue in full force and effect, subject, in the
case of any such outside insurance coverage that such coverage or
comparable coverage be maintained through the sixth anniversary of the
date you cease to provide services under the Services Agreement, to
the extent such coverage remains available at a commercially
reasonable rate.
2. This agreement will serve as notice of your termination in lieu of the
Notice of Termination required under the Employment Agreement as in
effect prior to the Termination Date.
3. Triarc will continue to pay base salary and provide employee benefits
through the Termination Date in accordance with the applicable
provisions of the Employment Agreement, provided you shall accrue no
further payments, bonuses, severance or other incentive payments
during (or with respect to) the 2007 calendar year, except as
expressly set forth herein.
4. (a) On December 31, 2007, Triarc shall pay to you, less the aggregate
amount required by law to be withheld upon such payment to you under
federal, state and local withholding requirements, a lump sum payment
of $5,627,414.76 (the "First Lump Sum Payment"). Except for such tax
withholding, such payment shall be unconditional and absolute and
shall not be subject to offsets, setoffs, recoupment, counterclaims or
reductions under any circumstances. Such payment is in lieu of the
payment that would otherwise have been paid to you in a lump sum
within 10 days after the Termination Date. If you die prior December
31, 2007, such payment shall be made to the legal guardian of your
estate on the scheduled payment date.
(b) In addition, Triarc shall pay to you, in the 2008 calendar year,
but in no event, no later than September 30, 2008, a lump sum payment
of $853,150.07, less the aggregate amount required by law to be
withheld upon such payment to you under federal, state and local
withholding requirements (the "Second Lump Sum Payment); provided,
however, if a Change of Control (as defined in Triarc's 2002 Equity
Participation Plan, as in effect as of the date hereof) of Triarc
occurs after January 1, 2008, but before September 30, 2008, the
Second Lump Sum Payment shall be paid on the date of such Change of
Control (September 30, 2008 or such earlier payment date for the
Second Lump Sum Payment, is referred to herein as the "Second Lump Sum
Payment Date"). Except for such tax withholding, such payment shall be
unconditional and absolute and shall not be subject to offsets,
setoffs, recoupment, counterclaims or reductions under any
circumstances. Such payment is in lieu of the amount of bonus payment
that would otherwise have been paid to you in 2008 with respect to
2007 had you continued to be employed by Triarc. If you die prior to
the Second Lump Sum Payment Date, such payment shall be made to the
legal guardian of your estate on the Second Lump Sum Payment Date. For
the avoidance of doubt, Triarc acknowledges that the provisions of
Section 12 of your Employment Agreement (as amended herein) shall be
applicable to the Second Lump Sum Payment.
5. Sub-clause (B) of Section 4.5 of the Employment Agreement is amended
as of the Termination Date to provide that each outstanding stock
option shall remain exercisable until the earlier of (i) one year
following the termination of your services to the Company as a
consultant (whether under the terms of the Services Agreement or
otherwise) for reasons other than "cause," (as such term was defined
in the Employment Agreement as in effect prior to the Termination
Date), as determined in good faith by the Compensation Committee of
Triarc ("Compensation Committee"), (ii) the earlier of the latest date
upon which such stock option could have expired by its original terms
under any circumstances or the tenth (10th) anniversary of the
original date of grant and (iii) immediately upon termination of your
services to Triarc as a consultant for "cause," (as such term was
defined in the Employment Agreement as in effect prior to the
Termination Date), as determined in good faith by the Compensation
Committee.
6. Section 8 of the Employment Agreement shall be amended to add a final
sentence to read as follows: "Any reimbursement the Company pays to
the Employee under this Section 8 shall be paid prior to the end of
the Employee's taxable year next following the taxable year in which
the action, suit or proceeding is completed."
7. Sub-clause (A) of Section 12 of the Employment Agreement shall be
amended to add a final sentence to read as follows: "Any Gross-Up
Payment the Company pays to the Employee shall be paid prior to the
end of the Employee's taxable year next following the taxable year in
which the Employee remits the Excise Tax."
8. You acknowledge and agree that following the Termination Date (i) to
the extent that during the term of the Services Agreement you are
associated with Trian you shall continue to provide services to Triarc
as a consultant as provided for under the Services Agreement, to the
extent reasonably requested by Triarc and (ii) to the extent that you
are no longer associated with Trian, you may at your election and
without any further payment or cost to Triarc, continue to provide
consulting services to Triarc for so long as requested by Triarc;
provided, however, that in the case of both clause (i) and (ii) above,
Triarc does not intend or contemplate that you will provide a level of
service to Triarc, and Triarc shall not request or require you to
provide such a level of service, that exceeds 20 percent of the
average level of service you performed for Triarc during the 36-month
period prior to the Termination Date; and provided that you agree to
cooperate with Triarc and Trian so as not to exceed such maximum
service levels. The terms of Section 8 of the Employment Agreement
shall apply with respect to any consulting services you may provide to
Triarc.
9. All Class B Units of Triarc Deerfield Holdings, LLC and all Class B
Units of Jurl Holdings, LLC held by you on the Termination Date are
fully vested and non-forfeitable effective as of the Termination Date.
10. You hereby acknowledge that as of the Termination Date, except as
expressly provided in this agreement, you will not be entitled to any
other payments, distributions, bonuses, severance, benefits or
perquisites from Triarc or any of its respective affiliates including
but not limited to, base salary, bonus (including any pro rata bonus
payments), distributions (other than 401(k) account balances),
allocations and group health benefits (other than COBRA rights to
continue and/or convert group medical coverage at your expense and any
conversion rights to which you may be entitled under law with respect
to continuing life insurance or long-term disability insurance
coverage at your expense) and you hereby fully release Triarc and its
respective affiliates and subsidiaries (the "Group") from all such
claims you may otherwise have (known or unknown) under the Employment
Agreement or under any other Triarc compensation plan or arrangement;
provided, however, that nothing contained in this discharge and
release shall release Triarc from any obligations arising under this
agreement or the surviving provisions of the Employment Agreement or
any agreement governing the terms of any Triarc stock options
previously granted to you. You further acknowledge that Triarc has
made arrangements for Trian to honor your accrued and outstanding 2007
vacation balance from Triarc, which will allow you to use your accrued
2007 vacation time at Trian. Notwithstanding anything herein, you
shall be entitled to all rights to indemnification and contribution
under the certificate of incorporation, bylaws or similar charter
documents of, or any agreement with, Triarc or any of its subsidiaries
or affiliates. Triarc, on behalf of the Group, hereby fully releases
you from any and all claims any of them may have against you based on
facts known to Messrs. Nelson Peltz, Peter W. May, Edward P. Garden or
Frances T. McCarron as of June 28, 2007, including, but not limited
to, any claims related to your employment or any term or condition of
that employment.
11. To the extent that Frances T. McCarron ("McCarron") accepts full-time
employment with Trian and Triarc enters into a cash payment
arrangement with McCarron with respect to the settlement and
termination of his letter agreement with Triarc, dated April 28, 2006
(the "McCarron Agreement"), and the cash payments provided for under
such arrangement, expressed as a percentage of payments that would
otherwise be due McCarron under Section (4) of the McCarron Agreement
exceeds 87.5% (the "McCarron Percentage"), Triarc shall pay to you, no
later than ten (10) business days following such determination, an
additional cash payment equal to the sum of (A) an amount (the
"Additional Schorr Payment") which, when added to $6,118,773.50, and
expressed as a percentage of $6,992,884, equals the McCarron
Percentage and (B) an amount equal to simple interest at 9.9% per
annum on the Additional Schorr Payment from July 1, 2007 through to
the payment date (the "Schorr Interest Factor"). The Additional Schorr
Payment and Schorr Interest Factor shall be subject to applicable
taxes and withholding. Notwithstanding the foregoing, the Additional
Schorr Payment shall be paid in the taxable year in which the
determination is made that Frank McCarron will receive the McCarron
Percentage or within the two and a half month period following such
taxable year.
12. The terms of this agreement (and the terms of the Employment Agreement
referenced herein) constitute the entire agreement between you and
Triarc regarding the cessation of your employment and the termination
of the Employment Agreement and may not be altered or modified other
than in a writing signed by you and Triarc. Except as provided herein,
this Agreement supersedes all prior arrangements, communications,
commitments or obligations between yourself and Triarc regarding the
subject matter herein.
Very truly yours,
/s/DAVID E. SCHWAB II
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David E. Schwab II
Member of the Board of Directors
On Behalf of Triarc Companies, Inc.
AGREED AND ACKNOWLEDGED
/s/BRIAN L. SCHORR
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Brian L. Schorr