Exhibit 10.5
SETTLEMENT AGREEMENT
THIS SETTLEMENT AGREEMENT is made as of the 6th day of June, 1997,
between Triarc Companies, Inc. ("Triarc"), a Delaware corporation, Xxxxxx
Xxxxxx, Security Management Corporation ("SMC"), and APL Corporation ("APL").
W H E R E A S
A. There is pending an action entitled Triarc Companies, Inc., v.
Xxxxxx Xxxxxx and Security Management Corp., 95 CIV 9169, in the United States
District Court, Southern District of New York, containing claims and
counterclaims, and the parties have made various allegations against one another
in court papers in that action (all such claims, counterclaims, and allegations
are collectively referred to as the "Triarc Action").
B. There is also pending a bankruptcy proceeding entitled In
re APL Corporation, No. 93-12506-BKC-PGH, pending in the United States
Bankruptcy Court, Southern District of Florida, Miami Division, in which Triarc
and Chesapeake Insurance Company, Ltd. ("Chesapeake") currently assert claims,
and in which SMC and APL have challenged those claims (collectively, the
"APL Proceeding").
C. There are also two appeals growing out of the APL
Proceeding, which appeals are captioned Security Management Corporation, et al,
v. Triarc Companies, Inc., et al., No. 96-1322-CIV-XXXXXXX and Triarc Companies,
Inc., et al v. Xxxxxx Xxxxxx et al., No. 96-2880-CIV-XXXXXXX, and which appeals
are pending in the United States District Court, Southern District of Florida.
Those appeals, and the underlying proceedings and the claims and allegations
asserted by the parties in court papers therein, are hereinafter referred to
collectively as the "Bankruptcy Appeals."
X. Xxxxxx has previously filed (1) a motion for an order
terminating the consent decree and for an order to show cause why Triarc should
not be held in contempt; and (2) a Supplemental Plea of Interpleader, both in
Granada Investments, Inc. v. Triarc Companies Inc., et al., Case No. 1:89CV0641
(N.D. Ohio), and has made certain allegations in court papers in those
proceedings (the claims and allegations asserted in those proceedings are
hereinafter referred to collectively as the "Granada Proceedings").
E. The parties wish to resolve amicably and without further cost,
expense, or risk all existing litigation and disputes between them related to
the Triarc Action, the APL Proceeding, the Bankruptcy Appeals, and the Granada
Proceedings, and to dismiss with prejudice the Triarc Action, the Bankruptcy
Appeals and the APL Proceeding (the Granada Proceedings having previously been
dismissed).
NOW, THEREFORE, in order to avoid the expense of further
litigation and to compromise disputed claims, and for and in consideration of
the mutual covenants, promises and agreements contained herein, the adequacy and
sufficiency of which as consideration are hereby acknowledged, the undersigned
parties hereby agree as follows:
1. Definitions.
"Affiliate" shall mean, with respect to any Person, any other
Person controlling, controlled by or under common control with, such Person.
"Agents" shall mean, with respect to any Person, such Person's
officers, directors, employees, attorneys, accountants, representatives, and
agents, in their capacities as such.
"Effective Date" shall mean the date as of which all actions
described in paragraph 3(a) have been taken.
"Person" shall mean any individual, corporation, partnership,
firm, joint venture, association, trust, unincorporated organization,
governmental or regulatory body or other entity.
"Posner" shall mean Xxxxxx Xxxxxx and all of his Affiliates,
including but not limited to APL and SMC.
"Triarc" shall mean Triarc and all of its Affiliates.
2. In full and complete satisfaction of all outstanding claims
between Triarc and Posner in the Triarc Action, the APL Proceeding, the
Bankruptcy Appeals and the Granada Proceedings, including without limitation any
claim for attorneys' fees: (a) Posner will pay $1.25 million to Triarc and SMC
will pay $1.25 million to Triarc (collectively, the "Settlement Payment"); (b)
Triarc will deliver or cause to be delivered to Posner writings in the forms
annexed as Exhibit A waiving all of its and Chesapeake's claims in the APL
Proceeding (the "Triarc Waiver") and assigning such claims to Posner (the
"Triarc Assignment"); (c) Triarc will deliver a stipulation to Posner in the
form annexed as Exhibit B dismissing with prejudice and without costs the
pending appeal by Triarc in the APL Proceeding (the "Triarc Stipulation"); (d)
Posner will deliver a stipulation to Triarc in the form annexed as Exhibit C
dismissing with prejudice and without costs the pending appeal by Posner in the
APL Proceeding (the "Posner Stipulation"); and (e) Posner and Triarc will
execute a Stipulation of Dismissal in the form annexed as Exhibit D, dismissing
the Triarc Action (including the claims and counterclaims) with prejudice and
without costs (the "Stipulation of Dismissal").
3. (a) After obtaining any signatures required by the Settlement
Agreement, the Triarc Waiver, the Triarc Stipulation, the Posner Stipulation,
and the Stipulation of Dismissal, counsel for Posner and Triarc will meet at the
offices of Xxxx, Weiss, Rifkind, Xxxxxxx & Xxxxxxxx at 10 A.M. on May 30, 1997.
At that meeting (A) counsel for Posner will deliver to counsel for Triarc (i)
the signature page of the Settlement Agreement executed by Posner, (ii) the
executed Posner Stipulation, and (iii) the executed Stipulation of Dismissal;
and (B) counsel for Triarc will (i) deliver to counsel for Posner the signature
page of the Settlement Agreement executed by Triarc, (ii) deliver to counsel
for Posner the executed Triarc Waiver and Triarc Assignment, (iii) deliver to
counsel for Posner the executed Triarc Stipulation and (iv) execute the
Stipulation of Dismissal. Simultaneous with the meeting of counsel
referred to in this paragraph 3, the Settlement Payment will be wire
transferred to or at the direction of Triarc.
(b) Counsel for Posner will cause the Triarc Waiver Promptly to
be filed in the court where the APL Proceeding is pending, and counsel for
either Posner or Triarc shall promptly file with the appropriate courts the
stipulations identified above.
4. As of the Effective Date, Triarc and its Agents shall and
hereby do willingly and voluntarily release Posner and his Agents from any and
all charges, fees, rights, debts, claims (including but not limited to claims
for attorneys' fees), obligations, damages, liabilities, demands, indebtedness,
actions and causes of action set forth in or relating to the Triarc Action, the
APL Proceeding, the Bankruptcy Appeals, and the Granada Proceedings and agree
and covenant not to bring any legal action directly or indirectly on any claims
so released.
5. As of the Effective Date, Posner and his Agents shall and
hereby do willingly and voluntarily release Triarc and its Agents from any and
all charges, fees, rights, debts, claims (including but not limited to claims
for attorneys' fees), obligations, damages, liabilities, demands, indebtedness,
actions and causes of action set forth in or relating to the Triarc Action, the
APL Proceeding, the Bankruptcy Appeals, and the Granada Proceedings, and agree
and covenant not to bring any legal action directly or indirectly on any claims
so released.
6. Nothing contained in this Settlement Agreement or in the
releases set forth above shall be deemed to affect any of the rights, remedies,
or obligations of Triarc and Posner or their Agents except as expressly set
forth herein. In particular, nothing contained in this Settlement
Agreement or in the releases set forth in paragraphs 4 and 5 above shall
limit or preclude Triarc or Posner or their respective agents from
defending against claims brought by the plaintiffs in Xxxxxx X. Xxxxxx, et
al. v. Xxxxxx Xxxxx, et al., in Case No. 3:96 CV 7408 (the "Xxxxxx Action'),
which was originally filed in the United States District Court for the Northern
District of Ohio, Western Division, or any other action that may be brought
by any of the plaintiffs in the Xxxxx Action, except that the
parties and their agents expressly release, and covenant not to xxx directly or
indirectly on, any and all claims for indemnification or contribution with
respect to the Xxxxx Action or any other action that may be brought by any of
the plaintiffs in the Xxxxx Action.
7. Triarc represents and warrants that it has the power and
authority to enter into this Settlement Agreement on behalf of itself, its
Affiliates, its Agents and its Affiliates' Agents and has not heretofore
assigned or transferred or purported to assign or transfer to any third party
any of the claims released in paragraph 4 above. Posner represents and warrants
that he has the power and authority to enter into this Settlement Agreement on
behalf of himself, his Affiliates, his Agents and his Affiliates' Agents and has
not heretofore assigned or transferred or purported to assign or transfer to any
third party any of the claims released in paragraph 5 above.
8. This Settlement Agreement shall be construed under the laws of
the State of New York without reference to any choice of law or conflict of law
provisions or rules. Any action to enforce this Settlement Agreement shall be
brought only in the federal or state courts of New York and each signatory
hereby consents to the jurisdiction and venue of such courts and agrees hereby
to accept service, and to waive any objection to the adequacy of service of
process by first-class mail, return receipt requested.
9. This Settlement Agreement constitutes the entire Agreement
and understanding among the parties hereto with respect to the subject
matter hereof, and supersedes all prior agreements and understandings, written
or oral, relating to the subject matter hereof.
10. This Settlement Agreement may not be modified, superseded,
terminated or amended and no provision hereby may be waived, except by a writing
making specific reference hereto signed by the party to be bound.
11. This Settlement Agreement shall be binding upon, and shall
inure to the benefit of, the parties hereto and their successors and assigns.
12. This Settlement Agreement may be signed in counterparts
which, when taken together, shall be deemed one and the same document. Counsel
for the parties, i.e. Xxxx, Weiss, Rifkind, Xxxxxxx & Xxxxxxxx on behalf of
Triarc Companies, Inc. and Xxxxxxxx & Xxxxx on behalf of Xxxxxx Xxxxxx, Security
Management Corporation and APL Corporation may sign on behalf of their
respective clients, provided that such counsel furnish a letter stating that
they are authorized to do so.
TRIARC COMPANIES, INC.
By: /s/Xxxxxx X. Xxxxxx
Vice President and Assistant Treasurer
XXXXXX XXXXXX
By: /s/Xxxxxx Xxxxxx
SECURITY MANAGEMENT CORPORATION
By: /s/Xxxxxx Xxxxxx Xxxxxxxxxx
Executive Vice President and Director
APL CORPORATION
By: /s/Xxxx X. XxXxxxx
