EXHIBIT 10.1
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SERVICES AGREEMENT
This SERVICES AGREEMENT (this "AGREEMENT") is made as of April 30, 2007
by and between Triarc Companies, Inc., a Delaware corporation ("TRIARC"), and
Trian Fund Management, L.P., a Delaware limited partnership ("TRIAN").
WHEREAS, in connection with the restructuring of Triarc, Triarc and
Trian desire to enter into this Agreement to set forth the terms and conditions
upon which Trian will provide certain ongoing transition services to Triarc as
described herein.
NOW, THEREFORE, and in consideration of the mutual covenants, rights,
and obligations set forth in this Agreement, the benefits to be derived
therefrom, and other good and valuable consideration, the receipt and the
sufficiency of are hereby acknowledged, the parties hereto agree as follows:
1. TERM. The term of this Agreement shall commence on June 30,
2007 (the "Commencement Date") and shall continue until June 30, 2009 (the
"Term") provided that in the event that Triarc wishes to extend the Term, it
shall advise Trian no later than ninety (90) days prior to the expiration of
the Term, and the parties shall discuss the possible extension of the Term on
mutually acceptable terms.
2. SERVICES TO BE PROVIDED. Trian shall provide to Triarc during
the Term the services described in this Agreement and such other professional
and strategic services as Triarc may reasonably request (collectively, the
"SERVICES") on an as-needed basis within a reasonable time after a request for
such Services by Triarc. To the extent the Services are required by Triarc,
Trian shall make the individuals listed on ANNEX A hereto (or, for the
individuals other than Messrs. Peltz and May, replacements approved by Triarc,
which approval shall not be unreasonably withheld) available to Triarc and
shall ensure that such individuals, if so requested by Triarc, commit an
appropriate level of time during the Term consistent with Trian's obligations
under this Agreement and provide Triarc with appropriate access to such
individuals' skills and expertise as deemed reasonably necessary by Triarc. The
Services shall include, without limitation, the following:
(a) MERGERS AND ACQUISITIONS; CORPORATE DEVELOPMENT.
Consultation and advice in connection with (i) the evaluation and
acquisition of stock or assets of other quick service restaurant
businesses or other related or complementary businesses, (ii) the
disposition of Triarc's interest in Deerfield & Company LLC, (iii) any
other strategic acquisition or disposition transactions that Triarc may
evaluate or execute
(b) CAPITAL MARKETS TRANSACTIONS; FINANCE AND INVESTMENT
BANKING. Consultation and advice in connection with corporate finance
and investment banking related services, including, but not limited to,
securitization and capital markets transactions and transactions
involving Triarc's outstanding convertible debt, and providing such
other financial consultation and advice as may be required from time to
time
(c) LEGAL. Consultation and advice in connection with legal
matters, including, without limitation, any reporting obligations of
Triarc under the Securities Exchange Act of 1934, as amended, and such
other support as Triarc shall consider to be appropriate and necessary
to handle such matters.
(d) ACCOUNTING. Consultation and advice in connection with
financial presentation and planning and such other matters as are
reasonably necessary for Triarc to comply with its financial reporting
obligations to third parties, including, without limitation, report
preparation, compliance with United States generally accepted
accounting principles and the Sarbanes-Oxley Act of 2002, footnote
disclosure, compilation and review and consultation and cooperation in
connection with the preparation of Triarc's federal, state and local
tax returns, tax planning and audits.
(e) INVESTOR RELATIONS AND CORPORATE COMMUNICATIONS.
Consultation and advice in connection with investor relations and
corporate communications, including, without limitation, Triarc's
annual report and press releases and communications with Triarc's
stockholders, the media, analysts and the New York Stock Exchange.
(f) INVESTMENTS/RESTAURANT OPERATIONS/DISPOSITIONS.
Consultation and advice in connection with Triarc's investment
portfolio, the growth of Triarc's restaurant operations and the sale or
disposition of assets or liabilities in connection with Triarc's
corporate restructuring.
(g) OTHER. Such other consultation and advice as may be
reasonably requested by Triarc from time to time.
3. FEES. In consideration of the provision of the Services and
unless terminated sooner under the terms of this Agreement, Triarc shall pay to
Trian a service fee, payable in quarterly installments commencing July 2007, as
follows: (a) $3.0 million per quarter during the first year of the Term; and
(b) $1.75 million per quarter during the second year of the Term. In the event
that any of the individuals designated on Annex A fail to satisfy their time
commitment to Triarc as provided for herein, and, other than with respect to
Messrs. Peltz and May, Trian fails to secure a replacement reasonably
acceptable to Triarc, in addition to any other remedies provided to Triarc
hereunder, the fees payable pursuant to this Section may, at the election of
Triarc (after providing Trian with notice and a reasonable opportunity to cure
such failure, to the extent then curable), be reduced for the remainder of the
Term by an appropriate amount to reflect the value of such individual's
services to Triarc. In the event a reduction in fees is required hereunder, the
parties shall negotiate in good faith to arrive at an appropriate reduction
under the given facts and circumstances and in the event the parties cannot
agree on such reduction, the matter shall be submitted to arbitration in
accordance with Section 16.
4. REIMBURSEMENT TO TRIAN OF CERTAIN COSTS. Trian shall be
entitled to reimbursement for reasonable and necessary out-of-pocket expenses
incurred by Trian in connection with the provisions of Services; PROVIDED THAT
Trian shall first notify and seek approval from Triarc prior to incurring any
expense in excess of $25,000 during a single calendar quarter.
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5. BILLING. Trian shall submit to Triarc from time to time a bill
in respect of the out-of-pocket expenses incurred pursuant to Section 4.
Invoices will be in such reasonable detail as to identify the out-of-pocket
expenses billed and, upon written request by Triarc, Trian shall provide Triarc
with copies of the invoices from such third parties for such expenses. Triarc
shall pay in cash to Trian the full amount of such approved expenses within 30
days after receipt of such bill from Trian.
6. INSURANCE. For a period of six years commencing as of the
Commencement Date, Triarc shall obtain extended reporting or tail coverage on
the directors' and officers' liability insurance policy and the employed
lawyers professional liability insurance policy maintained by Triarc as of the
date hereof for the benefit of those persons who are covered by such policies,
respectively, as of the close of business on the date immediately prior to the
Commencement Date and who will, commencing on the Commencement Date, provide
Services to Triarc under this Agreement (including such individuals who may
replace those persons pursuant to Section 3), in each case, on terms and
conditions that are, in the aggregate, no less favorable to the insured with
respect to claims arising from acts or omissions arising prior to and including
the date immediately prior to the Commencement Date than are currently in
effect; PROVIDED, that such extended reporting or tail coverage can be obtained
and maintained on commercially reasonable terms and at a cost to Triarc not
greater than two hundred percent (200%) of the aggregate annual premium for the
directors' and officers' liability insurance policy and the employed lawyers
professional liability insurance policy, as applicable, maintained by Triarc on
the date hereof; provided, FURTHER, that if the annual premiums of such
insurance coverage exceed such amount, Triarc shall be obligated to obtain
policies with the greatest coverage available for a cost not exceeding such
amount.
7. LIMITATION ON LIABILITY; INDEMNIFICATION.
(a) Trian shall have no liability with respect to, and
shall not be obligated to indemnify or hold harmless Triarc, or its
affiliates, officers, directors, employees, agents or other
representatives from or against any cost, loss, expense, damage or
liability arising out of or otherwise in respect of the performance of
the Services; PROVIDED THAT Trian shall indemnify and hold harmless
Triarc and its affiliates, officers, directors, employees, agents and
other representatives of Triarc from or against any such cost, loss,
expense, damage or liability resulting from the gross negligence,
willful misconduct or fraud of Trian or any of its officers, employees,
partners, members or agents. Triarc shall indemnify and hold harmless
Trian, its affiliates, officers, directors, employees, agents or other
representatives from and against any cost, loss, expense, damage or
liability arising out of or otherwise in respect of the performance of
the Services other than any such cost, loss, expense, damage or
liability resulting from the gross negligence, willful misconduct or
fraud of Trian or any of its officers, employees, partners, members or
agents.
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(b) Notwithstanding the terms of any indemnification
agreement between Triarc and those persons who will be providing
Services to Triarc under this Agreement once they are employed by Trian
(each an "Indemnification Agreement"), each such Indemnification
Agreement shall continue in full force and effect with respect to the
Services provided hereunder subject to the exclusions set forth in
Section 7(a). The indemnification pursuant to the Indemnification
Agreements shall not be deemed exclusive of any other rights to which
such persons may be entitled under Triarc's Certificate of
Incorporation or By-laws or under any other agreement, contract of
insurance, vote of stockholders or disinterested directors, or
otherwise, or of the broader power of Triarc to indemnify an agent of
Triarc as authorized by Delaware Law.
8. EMPLOYEES DEEMED TO BE CONSULTANTS; NOT EMPLOYEES OF TRIARC.
Employees of Trian engaged in performing the Services shall be considered to be
providing services to Triarc as its consultants. Under no circumstances shall
they be considered to be employees of Triarc or any of its subsidiaries.
9. INDEPENDENT CONTRACTOR. In performing the Services, Trian shall
be an independent contractor and neither party hereto shall be deemed to be an
agent, partner or co-venturer of the other due to the terms and provisions of
this Agreement. For the avoidance of doubt, neither Trian nor any of its
employees, partners, officers or agents shall have any right, power or
authority to bind Triarc in any manner whatsoever, except at the express
instruction of Triarc.
10. CONFIDENTIAL AND PROPRIETARY INFORMATION.
(a) In addition to any confidential and proprietary
information that the individuals listed on Annex A heretofore
developed, learned or became aware of as employees, directors, officers
or stockholders of Triarc (collectively, the "Prior Confidential
Information"), Triarc may, in connection with the provision of the
Services under this Agreement, provide to Trian or such individuals and
confide in any of them additional confidential and proprietary
information (collectively, the "Additional Confidential Information"),
including without limitation: (i) business methods and systems,
techniques and methods of operation developed by Triarc or its
affiliates and which Trian recognizes to be unique assets of the
business of Triarc and its affiliates; (ii) any research or data of any
kind; or (iii) any information relating to strategic plans or the
financial condition of Triarc or its affiliates which is not generally
known to the public. All the Prior Confidential Information and all the
Additional Confidential Information are herein sometimes referred to
collectively as "Confidential Information". Neither Trian nor any of
the individuals that provide the Services shall, either during or at
any time after the Term, directly or indirectly, in any manner utilize
or disclose any Confidential Information to any individual, firm,
corporation, company, association or other entity without the prior
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consent of Triarc (unless legally compelled to do so, but subject to
the provisions of Section 10(b)). The term "Confidential Information"
does not include information, knowledge or factual data that: (A)
becomes part of the public knowledge or literature other than by reason
of any inaction or action of Trian or any of the individuals that
provide the Services; (B) was disclosed to Trian or any of the
individuals that provide the Services without restriction by a third
party that is known by Trian or any of the individuals that provide the
Services, after reasonable inquiry, to have the right to disclose the
same; or (C) was independently developed by Trian or its agents. Trian
further covenants and agrees that it will (and will cause the
individuals that provide the Services to) promptly deliver to Triarc
all tangible evidence or any electronic copies of Confidential
Information, prior to or at the end of the Term.
(b) If Trian or any individual that provides the Services
becomes legally compelled (by deposition, interrogatory, request for
documents, order, subpoena, civil investigative demand or similar
process issued by a court of competent jurisdiction or by a
governmental body) to disclose any Confidential Information, then Trian
will give prompt prior notice of such requirement to Triarc so that
Triarc or any of its affiliates may seek a protective order or other
appropriate remedy and/or waive compliance with the terms of this
Agreement. If such protective order or other remedy is not obtained,
and regardless of whether or not compliance with the provisions hereof
is waived, then only that portion of the Confidential Information that
Trian is advised in writing by counsel is legally required to be
disclosed (which counsel shall be reasonably satisfactory to Triarc),
will be disclosed by Trian or the individual that provides the
Services, and commercially reasonable efforts will be made by Trian to
obtain assurance that confidential treatment will be accorded such
portion of such Confidential Information; provided, subject to Section
4, Triarc shall, at Trian's option, either advance the third party
costs and expenses necessary for Trian to seek to obtain such
confidential treatment or promptly reimburse Trian for its
out-of-pocket costs and expenses incurred to seek to obtain such
assurance of confidential treatment hereunder.
(c) The provisions herein governing Confidential
Information shall be separate and in addition to any other agreements
or obligations that Trian and its partners, employees, or agents may be
subject to regarding the confidential, trade secret and/or proprietary
nature of information related to Triarc or its affiliates and the
provisions set forth herein shall not in any way supercede or otherwise
limit any such other agreements or obligations.
11. ENTIRE AGREEMENT; WAIVERS AND AMENDMENTS. This Agreement sets
forth the entire understanding between Trian and Triarc relating to the subject
matter hereof. Except as provided herein, this Agreement shall not be modified
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or amended, and no provision hereof shall be waived, except by an instrument in
writing signed by each of the parties hereto, or in the case of a waiver, by
the party hereto against whom such waiver is sought to be enforced.
12. SUCCESSORS AND ASSIGNS. The provisions of this Agreement shall
be binding upon and inure to the benefit of the parties and their respective
successors and permitted assigns. No party may assign, delegate or otherwise
transfer any of its rights or obligations under this Agreement without the
prior written consent of the other party. Notwithstanding the foregoing, Triarc
(or its permitted successive assignees or transferees hereunder) may assign or
transfer this Agreement as a whole without consent to an entity that succeeds
to all or substantially all of the business or assets of Triarc.
13. NO THIRD PARTY BENEFICIARIES. The persons that will be
providing services to Triarc pursuant to this Agreement shall be deemed third
party beneficiaries of the provisions set forth in Sections 6 and 7 of this
Agreement. Except as provided in the preceding sentence, nothing in this
Agreement shall confer any rights upon any person which is not a party or a
successor or permitted assignee of a party to this Agreement.
14. TERMINATION. This Agreement may be terminated (a) at any time
by the written agreement of the parties hereto, (b) by either party 20 days
following written notice to the other party of a material breach of this
Agreement by such party, if the defaulting party has not cured the breach
within such 20-day period or (c) by Triarc 20 days following written notice to
Trian of a breach by any of Trian's principals of any agreements or commitments
to Triarc or the failure or inability of Trian to deliver the services of
Messrs. Peltz and May provided for hereunder, if such breach or failure has not
been cured within such 20-day period.
15. GOVERNING LAW. This Agreement shall be governed by, construed
and enforced in accordance with the laws of the State of New York, without
regard to the conflict of laws principles thereof.
16. ARBITRATION. Any dispute, controversy or claim arising out of
or relating to this Agreement, or the breach thereof, that the parties are not
able to resolve after good faith efforts over a period of 15 days shall be
settled by a single arbitrator in an arbitration conducted in the Borough of
Manhattan, The City of New York, and administered by the American Arbitration
Association (the "AAA"). Such arbitration shall be under the Commercial
Arbitration Rules of the AAA and judgment on the award rendered by the
arbitrator may be entered in any court having jurisdiction thereof. Each party
shall be responsible for its own fees and costs associated with such
arbitration.
17. NOTICES. All notices, demands and other communications given to
or made by either party to the other in connection with this Agreement shall be
given in writing and either personally served on an officer or other authorized
representative of the party to which it is given or mailed by registered first
class mail, postage prepaid, to the headquarters of such party to the attention
of its chief financial officer, with a copy to its general counsel, or to such
other address and to the attention of such persons as the party in question may
from time to time specify to the other by notice hereunder. All notices shall
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be deemed delivered and effective (a) if hand-delivered, upon delivery, (b) if
telecopied (with a confirmed receipt thereof), upon delivery or (c) if mailed,
three business days after mailing.
18. HEADINGS. The headings contained in this Agreement are for
reference purposes only and shall not in any way affect the meaning or
interpretation of this Agreement.
19. COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original, but all of which
together shall constitute one and the same instrument.
IN WITNESS WHEREOF the parties hereto have executed this Agreement
effective as of the date first above written.
TRIARC COMPANIES, INC.
By: /s/ Francis T. McCarron
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Name: Francis T. McCarron
Title: Executive Vice President and
Chief Financial Officer
TRIAN FUND MANAGEMENT, L.P.
By: Trian Fund Management GP, LLC,
its general partner
By: /s/ Peter W. May
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Name: Peter W. May
Title: Member
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ANNEX A
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Nelson Peltz
Peter W. May
Edward P. Garden
Brian L. Schorr
Chad Fauser
Joshua Frank
Brian Jacoby
Ken Lande
Jim Maxfield
Eduardo Santos*
Anne A. Tarbell
Greg Essner
David Mosse
And any other persons employed by Triarc who become employees of Trian during
the Term.
* Mr. Santos shall be a designated individual hereunder for only so long as he
is employed by Trian in the New York metropolitan area and thereafter he shall
be deleted from Annex A and Trian shall have no further obligation to replace
him and no fee reduction shall be required under Section 3 with respect to his
removal hereunder.
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