Exhibit 10.1
EMPLOYMENT AGREEMENT
This EMPLOYMENT AGREEMENT is made as of May 1, 1999 (the "Effective
Date"), by and between TRIARC COMPANIES, INC., a Delaware corporation (the
"Corporation"), and Xxxxxx Xxxxx (the "Executive").
The Corporation, on behalf of itself and its shareholders, wishes to
continue to retain the Executive as an integral part of the management of the
Corporation.
IT IS, THEREFORE, AGREED:
1. Term of Agreement. This Agreement shall be effective as of the
Effective Date and, subject to Section 6, expire on April 30, 2004 (the
"Employment Period"); provided that the Employment Period shall automatically be
extended for successive one-year periods on May 1 of each year unless, not later
than 180 days preceding the date of any such extension, either party gives the
other party written notice (in accordance with Section 12(b)) of such party's
intention not to further extend the Employment Period.
2. Change of Control. For the purpose of this Agreement, a
"Change of Control" shall be deemed to have taken place if:
A. Individuals who, on the date hereof, constitute the Board
of Directors (the "Board") of the Corporation (the
"Incumbent Directors") cease for any reason to constitute
at least a majority of the Board, provided that any person
becoming a director subsequent to the date hereof, whose
election or nomination for election was approved by a
vote of at least two-thirds of the Incumbent Directors then
on the Board (either by a specific vote or by approval of
the proxy statement of the Corporation in which such
person is named as a nominee for director, without written
objection to such nomination) shall be an Incumbent
Director; provided, however, that no individual initially
elected or nominated as a director of the Corporation as a
result of an actual or threatened election contest with
respect to directors or as a result of any other actual or
threatened solicitation of proxies or consents by or on
behalf of any person other than the Board shall be deemed
to be an Incumbent Director;
B. Any "Person" (as such term is defined in Section 3(a)(9)
of the Securities Exchange Act of 1934 (the "Exchange
Act") and as used in Sections 13(d)(3) and 14(d)(2) of the
Exchange Act) is or becomes a "beneficial owner" (as
defined in Rule 13d-3 under the Exchange Act), directly
or indirectly, of securities of the Corporation representing
50% or more of the combined voting power of the
Corporation's then outstanding securities eligible to vote
for the election of the Board (the "Voting Securities");
provided, however, that the event described in this
paragraph B. shall not be deemed to be a Change in
Control by virtue of any of the following acquisitions: (i)
by the Corporation or any subsidiary of the Corporation in
which the Corporation owns more than 50% of the
combined voting power of such entity (a "Subsidiary"),
(ii) by any employee benefit plan (or related trust)
sponsored or maintained by the Corporation or any
Subsidiary, (iii) by any underwriter temporarily holding
the Corporation's Voting Securities pursuant to a public
offering of such Voting Securities, (iv) pursuant to a Non-
Qualifying Transaction (as defined in paragraph C
immediately below), (v) pursuant to any acquisition by
Executive or by any Person which is an "affiliate" (within
the meaning of 17 C.F.R.ss.230.405) of Executive, or (vi)
pursuant to any acquisition by any Person as to which
Executive and Xxxxx Xxx, acting as a "group" (within the
meaning of Section 14(d)(2) of the Exchange Act), are
affiliates (an "Excluded Person");
C. The consummation of a merger, consolidation, statutory
share exchange or similar form of corporate transaction
involving the Corporation or any of its Subsidiaries that
requires the approval of the Corporation's stockholders,
whether for such transaction or the issuance of securities
in the transaction (a "Business Combination"), unless
immediately following such Business Combination: (i)
more than 50% of the total voting power of (A) the
corporation resulting from such Business Combination
(the "Surviving Corporation"), or (B) if applicable, the
ultimate parent corporation that directly or indirectly has
beneficial ownership of 100% of the voting securities
eligible to elect directors of the Surviving Corporation
(the "Parent Corporation"), is represented by the
Corporation's Voting Securities that were outstanding
immediately prior to such Business Combination (or, if
applicable, is represented by shares into which the
Corporation's Voting Securities were converted pursuant to
such Business Combination), and such voting power among the
holders thereof is in substantially the same proportion as the
voting power of the Corporation's Voting Securities among the
holders thereof immediately prior to the Business Combination,
(ii) no Person (other than (A) any employee benefit plan (or
related trust) sponsored or maintained by the Surviving
Corporation or the Parent Corporation or (B) an Excluded
Person) is or becomes the beneficial owner, directly or
indirectly, of 50% or more of the total voting power of the
outstanding voting securities eligible to elect directors of
the Parent Corporation (or, if there is no Parent Corporation,
the Surviving Corporation) and (iii) at least a majority of
the members of the board of directors of the Parent
Corporation (or, if there is no Parent Corporation, the
Surviving Corporation) following the consummation of the
Business Combination were Incumbent Directors at the time of
the Board's approval of the execution of the initial agreement
providing for such Business Combination (any Business
Combination which satisfies all of the criteria specified in
(i), (ii) and (iii) above shall be deemed to be a
"Non-Qualifying Transaction");
D. A sale of all or substantially all of the Corporation's
assets, other than to an Excluded Person;
E. The stockholders of the Corporation approve a plan of
complete liquidation or dissolution of the Corporation; or
F. Such other events as the Board may designate.
Notwithstanding the foregoing, a Change in Control of the Company shall
not be deemed to occur solely because any person acquires beneficial ownership
of more than 50% of the Corporation's Voting Securities as a result of the
acquisition of the Corporation's Voting Securities by the Corporation which
reduces the number of the Corporation's Voting Securities outstanding; provided,
that if after such acquisition by the Corporation such person becomes the
beneficial owner of additional Corporation Voting Securities that increases the
percentage of outstanding Corporation Voting Securities beneficially owned by
such person, a Change in Control of the Corporation shall then occur.
3. Employment Period. The Corporation hereby agrees to continue
Executive in its employ for the Employment Period.
4. Position and Duties.
A. As of the date hereof, Executive is employed as Chairman
and Chief Executive Officer of the Corporation, and as
such Executive is responsible for oversight and
management of all operations and activities of the
Corporation. Executive shall report to the Board. During
the Employment Period, Executive's position (including
status, offices, titles and reporting requirements),
authority, duties and responsibilities shall be consistent
with those of the Chairman and Chief Executive Officer of
a publicly traded corporation. Executive's services shall
be performed primarily at the executive offices of the
Corporation located in New York City, subject to
reasonable travel requirements.
B. Excluding periods of vacation, sick leave and disability to
which Executive is entitled, Executive agrees to devote
reasonable attention and time during normal business
hours to the business and affairs of the Corporation and,
to the extent necessary to discharge the responsibilities
assigned to Executive hereunder, to use Executive's
reasonable best efforts to perform faithfully and efficiently
such responsibilities. Executive may (i) serve on
corporate, civic, educational, philanthropic or charitable
boards or committees, (ii) deliver lectures, fulfill speaking
engagements or teach at educational institutions and (iii)
manage personal investments, so long as such activities do
not significantly interfere with the performance of
Executive's responsibilities hereunder. It is expressly
understood and agreed that to the extent that any such
activities have been conducted by Executive prior to a
Change in Control, the continued conduct of such
activities (or the conduct of activities similar in nature and
scope thereto) subsequent to the Change in Control shall
not thereafter be deemed to interfere with the performance
of Executive's responsibilities to the Corporation.
5. Compensation.
A. Base Salary. During the Employment Period, as
consideration for services rendered, the Corporation shall
pay to Executive a base salary at an annual rate at equal to
$1,400,000 for each year of the Employment Period, as
adjusted as described in the following sentence ("Base
Salary"), payable in accordance with the regular pay
policy of the Corporation. During the Employment
Period, Base Salary may be increased, but not decreased,
at the discretion of the Board or the Compensation
Committee thereof. Any increase in Base Salary shall not
serve to limit or reduce any other obligation to Executive
under this Agreement. Executive's Base Salary may not
be reduced after any such increase.
B. Bonus and Incentive Programs. Executive shall (without
duplication) receive an annual bonus in respect of each
fiscal year of the Corporation (a "Fiscal Year") ending
during the Employment Period, at least equal to the bonus
amount actually earned by Executive for such fiscal year
under the Corporation's 1999 Executive Bonus Plan, as it
may hereinafter be amended, modified or superseded or
supplemented by another bonus plan sponsored by the
Corporation or any affiliated company; provided that the
Board (including the Compensation Committee thereof)
may award Executive additional bonus amounts in its
discretion (the aggregate of such bonus amounts being
referred to hereunder as the "Bonus"). In addition to the
Base Salary and Bonus payable as hereinabove provided,
Executive shall be entitled to participate during the
Employment Period in all incentive programs (whether
cash or equity based, or otherwise), savings, pension,
profit sharing and retirement plans and programs
applicable to other key executives of the Corporation. In
no event shall such plans and programs, in the aggregate,
provide Executive following a Change in Control with
compensation, benefits and reward opportunities less
favorable than the most favorable of those provided by the
Corporation and its subsidiaries for Executive under such
plans and programs as in effect at any time during the
ninety-day period immediately preceding the Change in
Control or, if more favorable to Executive, as provided at
any time thereafter with respect to any other key
executive.
C. Welfare Benefit Plans. During the Employment Period,
Executive and/or Executive's family, as the case may be,
shall be eligible for participation in and shall receive all
benefits under each welfare benefit plan of the
Corporation, including, without limitation, all medical,
prescription, dental, disability, salary continuance, life,
accidental death and travel accident insurance plan and
programs of the Corporation and its affiliated companies.
In no event shall such plans and programs, in the
aggregate, provide Executive following a Change in
Control with benefits less favorable than the most
favorable of those provided by the Corporation and its
affiliated companies for Executive under such plans and
programs as in effect at any time during the ninety-day
period immediately preceding the Change in Control or, if
more favorable to Executive, as provided at any time
thereafter with respect to any other key executive.
D. Expenses. During the Employment Period, Executive
shall be entitled to receive prompt reimbursement for all
reasonable expenses incurred by Executive in the
performance of his duties hereunder, subject to the
submission of such written documentation as the
Corporation may reasonably require in accordance with its
standard expense reimbursement practices and policies.
E. Office and Support Staff. During the Employment Period,
Executive shall be entitled to an office and secretarial and
other assistance consistent with his position. For five
years following a Change in Control, Executive shall be
entitled to an office or offices of a size and with
furnishings and other appointments, and to secretarial and
other assistance, at least equal to those provided to
Executive at any time during the ninety-day period
immediately preceding the Change in Control, or, if more
favorable to Executive, as provided at any time thereafter
with respect to any other key executive.
F. Vacation. During the Employment Period, Executive
shall be entitled to six weeks per year of paid vacation.
G. Perquisites. During the Employment Period, Executive
shall be entitled to (i) be provided a driver of Executive's
choice, at the Corporation's cost, (ii) have a new automobile
of Executive's choice provided to him by the Corporation at
the Corporation's cost (and to have such automobile
replaced with a new one once it is three years old), and be
provided reimbursement for expenses incurred by Executive
in maintaining such automobile, including parking, gasoline,
insurance and maintenance, (iii) reimbursement for tax,
estate, financial planning and accounting services from
entities or individuals selected by Executive, up to a
maximum of $50,000 per year, and (iv) the use of aircraft
owned, rented or leased by the Corporation. The
Corporation shall report the taxable portion of the above in
accordance with applicable rules and regulations of the
Internal Revenue Service. The Corporation acknowledges
that it is making available the use of Corporation aircraft
pursuant to clause (iv) above primarily to ensure the safety
and security of Executive for the benefit of the Corporation,
and the Corporation encourages Executive to use such
aircraft when he travels, irrespective of whether such travel
is primarily for personal or business purposes.
H. Life Insurance. The Executive will cooperate in assisting the
Corporation in obtaining a key man life insurance policy on
the life of Executive, the beneficiary of which shall be named
by the Corporation, including completing all necessary
application materials and submitting to one or more physical
examinations with a physician of the Corporation's choice.
6. Termination. This Agreement shall terminate under the following
circumstances:
A. Death or Disability. This Agreement and the Employment
Period shall terminate automatically upon Executive's death.
The Corporation may terminate this Agreement, after having
established Executive's Disability (pursuant to the definition
of "Disability" set forth below), by giving to Executive
written notice of its intention to terminate Executive's
employment. In such a case, Executive's employment with
the Corporation shall terminate effective on the 180th day
after receipt of such notice (the "Disability Effective
Date"), provided that, within 180 days after such receipt,
Executive shall not have returned to full performance of
Executive's
duties. For purposes of this Agreement, "Disability" means
personal injury, illness or other cause which, after the
expiration of not less than 180 days after its commencement,
renders Executive unable to perform his duties with
substantially the same level of quality as immediately prior
to such incident and such disability is determined to be total
and permanent by a physician selected by the Corporation or
its insurers and acceptable to Executive or Executive's legal
representative (such agreement as to acceptability not to be
withheld unreasonably).
B. With or Without Cause. The Corporation may terminate
Executive's employment with or without "Cause." The
Employment Period shall immediately end upon a
termination by the Corporation with Cause. For purposes of
this Agreement, "Cause" means (i) the willful and continued
failure of Executive to perform substantially his duties with
the Corporation (other than any such failure resulting from
Executive's incapacity due to physical or mental illness or
any such failure subsequent to Executive being delivered a
Notice of Termination without Cause by the Corporation or
delivering a Notice of Termination for Good Reason to the
Corporation) after a written demand for substantial
performance is delivered to Executive by the Board which
specifically identifies the manner in which the Board
believes that Executive has not substantially performed
Executive's duties and Executive has failed to cure such
failure to the reasonable satisfaction of the Board, (ii) the
willful engaging by Executive in gross misconduct which
results in substantial damage to the Corporation or its
affiliates, or (iii) Executive's conviction (by a court of
competent jurisdiction, not subject to further appeal) of, or
pleading guilty to, a felony. For purpose of this paragraph
B, no act or failure to act by Executive shall be considered
"willful" unless done or omitted to be done by Executive in
bad faith and without reasonable belief that Executive's
action or omission was in the best interests of the
Corporation or its affiliates. Any act, or failure to act,
based upon authority given pursuant to a resolution duly
adopted by the Board or based upon the advice of counsel
for the Corporation shall be conclusively presumed to be
done, or omitted to be done, by Executive in good faith and
in the best interests of the Corporation. Cause shall not
exist unless and until the Corporation has delivered to
Executive, along with the Notice of Termination for Cause,
a copy of a resolution duly adopted by three-quarters (3/4) of
the entire Board (excluding Executive if Executive is a Board
member) at a meeting of the Board called and held for such
purpose (after reasonable notice to Executive and an
opportunity for Executive, together with counsel, to be heard
before the Board), finding that in the good faith opinion of
the Board an event set forth in clauses (i) - (iii) above has
occurred and specifying the particulars thereof in detail. The
Board must notify Executive of any event constituting Cause
within ninety (90) days following the Board's knowledge of its
existence or such event shall not constitute Cause under this
Agreement.
C. With or Without Good Reason. Executive's employment
may be terminated by Executive with or without Good
Reason. The Employment Period shall immediately end
upon a termination by Executive without Good Reason.
For purposes of this Agreement, "Good Reason" means:
(i) (a) any change in the duties or responsibilities
(including reporting responsibilities) of Executive
that is inconsistent in any material and adverse
respect with Executive's position(s), duties,
responsibilities or status with the Corporation
immediately prior to the Effective Date (including
any material and adverse diminution of such duties
or responsibilities); provided, however, that Good
Reason shall not be deemed to occur upon a change
in duties or responsibilities (other than reporting
responsibilities) that is solely and directly a result
of the Corporation no longer being a publicly traded
entity and does not involve any other event set forth
in this paragraph C or (b) a material and adverse
change in Executive's titles or offices (including his
position as President and Chief Operating Officer)
with the Corporation;
(ii) any failure by the Corporation to comply with any of
the provisions of Section 5 of this Agreement;
(iii) the Corporation requiring Executive to be based at any
office or location other than that described in Section
4.A. hereof, or requiring Executive to travel in the
performance of his duties significantly more extensively
than the customary travel requirements of Executive as
of the Effective Date;
(iv) any purported termination by the Corporation of
Executive's employment otherwise than as permitted by
this Agreement, it being understood that any such
purported termination shall not be effective for any
purpose of this Agreement; or
(v) any failure by the Corporation to comply with and
satisfy Section 11.C of this Agreement by causing any
successor to the Corporation to expressly assume and
agree to perform this Agreement with Executive, to the
full extent set forth in said Section 11.C;
provided that a termination by Executive with Good Reason shall be effective
only if, within 30 days following the delivery of a Notice of Termination for
Good Reason by Executive to the Corporation, the Corporation has failed to cure
the circumstances giving rise to Good Reason to the reasonable satisfaction of
Executive. For purposes of this Section 6.C, a good faith determination made by
Executive that a "Good Reason" for termination has occurred, and has not been
adequately cured, shall be conclusive and binding. In addition to the above, any
termination by Executive for any reason on or after a Change of Control shall be
deemed to be a termination with Good Reason.
D. Expiration of the Employment Period. This Agreement
shall terminate upon the expiration of the Employment
Period due to the Corporation's giving to Executive a
written notice of intention not to extend the Employment
Period in accordance with Section 1.
E. Notice of Termination. Any termination by the Corporation
with or without Cause or by Executive with or without Good
Reason shall be communicated by Notice of Termination to
the other party hereto given in accordance with Section 12.B
of this Agreement. For purposes of this Agreement, a
"Notice of Termination" means a written notice which (i)
indicates the specific termination provision in this Agreement
Agreement relied upon, (ii) sets forth in reasonable detail
facts and circumstances claimed to provide a basis for
termination of Executive's employment under the provision
so indicated and (iii) if the termination date is other than
the date of receipt of such notice specifies the proposed
termination date.
7. Obligations of the Corporation Upon Termination.
A. Death. If Executive's employment is terminated by reason
of Executive's death, the Corporation shall:
a. pay Executive's estate, in a lump sum in cash within
30 days after the date of death, the amounts
described in clauses a and d of Section 7.D.;
b. pay Executive's estate the amounts described in
clauses b and c of Section 7.D. at the time or times
determined by the Corporation, but in no event less
rapidly than five substantially equal annual
installments beginning no later than 30 days after the
date of death;
c. pay Executive's estate, in a lump sum in cash at the
time Executive would have been entitled to receive his
Bonus for the Fiscal Year in which his death occurs, a
pro-rata Bonus for such Fiscal Year equal to the product
of X * Y (such product referred to below as the
"Pro-Rata Bonus"), where:
X = the greatest of (a) the largest Bonus paid to
Executive in respect of the two Fiscal Years
preceding the date of termination; provided
that the Bonus paid to Executive in respect of
the 1999 Fiscal Year pursuant to the
Corporation's 1999 Executive Bonus Plan
shall be annualized for this purpose (the
"Look-Back Bonus"), (b) the Bonus which
would have been paid to Executive in respect
of the Fiscal Year in which termination
occurs if the Corporation attained its
budgeted financial performance, and
accomplished any other targeted goals, for
such year, as reasonably determined by the
Compensation Committee of the Board (the
"Target Bonus"), or (c) the Bonus which
would have been paid to Executive in respect
of the Fiscal Year in which termination
occurs based on the Corporation's actual
performance, and actual accomplishment of any
other targeted goals, as reasonably determined by
the Compensation Committee of the Board (the
"Actual Bonus," and the greatest of (a), (b) and
(c) the "Highest Bonus"); and
Y = the number of days elapsed in such year
preceding the date of termination divided by 365;
d. pay Executive's estate, within 30 days after the date
of death, the amount described in clause (iv) of the
first sentence of the second to last paragraph of
Section 7.D.;
e. provide those death benefits to which Executive is
entitled at the date of Executive's death under any
death benefit plans, policies or arrangements of the
Corporation which, following a Change in Control,
shall be at least comparable to those in effect at any
time during the ninety-day period immediately
preceding the Change in Control or, if more
favorable to Executive and/or Executive's designees,
as in effect on the date of Executive's death with
respect to other key executives and their designees;
and
f. provide to Executive's family the welfare benefits, or
payment in lieu of welfare benefits, described in clause
(iii) of the first sentence, and the second sentence, of
the second to last paragraph of Section 7.D.
In addition, upon a termination of Executive in accordance
with this Section 7.A:
g. all non-vested stock options, and any other non-
vested stock or stock-based awards issued by the
Corporation or any subsidiary of the Corporation,
shall immediately become fully vested, non-
forfeitable and exercisable; provided that, in the case
of options or awards granted by Triarc Beverage
Holdings Corp. ("TBHC"), this clause g. shall not
be operative unless and until such vesting would not
constitute a default or an event of default, or result
in a mandatory prepayment requirement, under the terms
of any agreement for indebtedness for borrowed money
(each, a "Financing Limitation"); and
h. all Executive's stock options (A) granted on or after
February 24, 2000 by the Corporation or any of its
subsidiaries, or (B) granted by the Corporation
before February 24, 2000 (including those
previously vested) if the exercise price thereof is
greater than the closing price of the Corporation's
common stock on the New York Stock Exchange on
February 24, 2000, shall remain exercisable until the
earlier of (i) one year following termination or (ii)
their respective stated expiration dates; provided that
in the case of options or awards described in
subclause (A) of this clause h. which are granted by
TBHC, this clause h. shall be subject to any
applicable Financing Limitation.
B. Disability. If Executive's employment is terminated by
reason of Executive's disability, the Corporation shall:
a. pay Executive, in a lump sum in cash within 30 days
following the Disability Effective Date, the amounts
described in clauses a and d of Section 7.D.;
b. pay Executive's estate the amounts described in
clauses b and c of Section 7.D. at the time or times
determined by the Corporation, but in no event less
rapidly than substantially equal annual installments
beginning no later than 30 days after the Disability
Effective Date;
c. pay Executive the Pro-Rata Bonus for the Fiscal Year in
which the Disability Effective Date occurs, to be paid
to Executive in a lump sum in cash at the time Executive
would have been entitled to receive his Bonus for such
Fiscal Year;
d. pay Executive, within 30 days after the Disability
Effective Date, the amount described in clause (iv)
of the first sentence of the second to last paragraph
of Section 7.D.;
e. provide those disability benefits to which Executive
is entitled at the Disability Effective Date under any
disability benefit plans, policies or arrangements of
the Corporation which, following a Change in
Control, shall be at least comparable to those in
effect at any time during the ninety-day period
immediately preceding the Change in Control or, if
more favorable to Executive and/or Executive's
designees, as in effect on the Disability Effective
Date with respect to other key executives and their
designees; and
f. provide to Executive and his family the benefits, or
payment in lieu of benefits, described in clause (iii)
of the first sentence, and the second sentence, of the
second to last paragraph of Section 7.D.
In addition, upon a termination of Executive in accordance
with this Section 7.B:
g. all non-vested stock options, and any other non-
vested stock or stock-based awards issued by the
Corporation or any subsidiary of the Corporation,
shall immediately become fully vested, non-
forfeitable and exercisable; provided that, in the case
of options or awards granted by TBHC, this clause
g. shall be subject to any applicable Financing
Limitation; and
h. all Executive's stock options (A) granted on or after
February 24, 2000 by the Corporation or any of its
subsidiaries, or (B) granted by the Corporation
before February 24, 2000 (including those
previously vested) if the exercise price thereof is
greater than the closing price of the Corporation's
common stock on the New York Stock Exchange on
February 24, 2000, shall remain exercisable until the
earlier of (i) one year following termination or (ii)
their respective stated expiration dates; provided that
in the case of options or awards described in
subclause (A) of this clause h. which are granted by
TBHC, this clause h. shall be subject to any
applicable Financing Limitation.
C. Cause or Without Good Reason. If Executive's employment shall
be terminated (i) by the Corporation with Cause, or (ii) by
Executive without Good Reason, the Corporation shall pay
Executive his Base Salary through the date of termination and
any accrued vacation pay, and shall have no further
obligations to Executive under this Agreement.
D. Without Cause or With Good Reason. If Executive's employment
shall be terminated (i) by the Corporation without Cause, or
(ii) by Executive with Good Reason, the Corporation shall pay
to Executive in a lump sum in cash within ten (10) days after
the date of termination the aggregate of the following
amounts:
a. to the extent not theretofore paid, Executive's Base
Salary through the date of termination plus any
Bonus amounts which have become payable and any
accrued vacation pay;
b. Executive's Base Salary for the remainder of the
Employment Period;
c. five times the Highest Bonus; provided that, for this
purpose, the Highest Bonus shall be calculated using
only the Look-Back Bonus and the Target Bonus;
and
d. five times the sum of employer contributions paid or
accrued on Executive's behalf to any qualified or
nonqualified defined contribution retirement plans
during the calendar year immediately preceding
termination.
In addition, upon a termination of Executive in
accordance with this Section 7.D, the Corporation shall (i)
pay Executive the Pro-Rata Bonus for the Fiscal Year in which
the termination date occurs, to be paid to Executive in a lump
sum in cash at the time Executive would have been entitled to
receive his Bonus for such Fiscal Year, (ii) if the Actual
Bonus for the Fiscal Year in which the termination date
occurs, as calculated following the end of
such Fiscal Year, exceeds the Highest Bonus as determined in
accordance with clause c. immediately above, pay Executive
five times the amount by which such Actual Bonus exceeds such
Highest Bonus in a lump sum in cash at the time Executive
would have been entitled to receive his Bonus for such Fiscal
Year; (iii) continue to provide welfare benefits to Executive
and his family for the remainder of the Employment Period at
least equal to those which were being provided to them in
accordance with Section 5.C at any time within the six-month
period ending on the date of termination and (iv) credit
Executive with five additional years of age and service under
each qualified and nonqualified defined benefit pension plan
of the Corporation in which Executive participates at the time
of termination; provided that in the case of a qualified
defined benefit pension plan, the present value of the
additional benefit Executive would have accrued if he had been
credited with such additional years of age and service
(computed using the actuarial assumptions used for purposes of
the most recent actuarial report in respect of such plan) will
be paid in a lump sum in cash within thirty (30) days after
the date of termination; further provided that, in computing
such additional benefit, Executive shall be deemed to earn
compensation for such additional five-year period at the same
rate as in the calendar year immediately preceding such
termination. To the extent that the benefits provided for in
clause (iii) are not permissible after termination of
employment under the terms of the benefit plans of the
Corporation then in effect, the Corporation shall pay to
Executive in a lump sum in cash within thirty (30) days after
the date of termination an amount equal to the after-tax cost
to Executive of acquiring on a non-group basis, for the
remainder of the Employment Period, those benefits lost to
Executive and/or Executive's family as a result of Executive's
termination.
In addition, upon a termination of Executive in accordance
with this Section 7.D (including for this purpose a
termination at the end of the Employment Period following
delivery by the Corporation to Executive of a notice not to
extend the Employment Period pursuant to the proviso in
Section 1 hereof):
e. all non-vested stock options, and any other non-
vested stock or stock-based awards issued by the
Corporation or any subsidiary of the Corporation,
shall immediately become fully vested, non-
forfeitable and exercisable; provided that, in the case
of options or awards granted by TBHC, this clause
e. shall be subject to any applicable Financing
Limitation; and
f. all Executive's stock options (A) granted on or after
February 24, 2000 by the Corporation or any of its
subsidiaries, or (B) granted by the Corporation
before February 24, 2000 (including those
previously vested) if the exercise price thereof is
greater than the closing price of the Corporation's
common stock on the New York Stock Exchange on
February 24, 2000, shall remain exercisable until the
earlier of (i) one year following termination or (ii)
their respective stated expiration dates; provided that
in the case of options or awards described in
subclause (A) of this clause f. which are granted by
TBHC, this clause f. shall be subject to any
applicable Financing Limitation.
8. Non-Exclusivity of Rights. Nothing in this Agreement shall prevent or
limit Executive's continuing or future participation in any benefit, bonus,
incentive (whether cash or equity based, or otherwise) or other plan or program
provided by the Corporation or any of its affiliated companies and for which
Executive may qualify, nor shall anything herein limit or otherwise affect such
rights as Executive may have under any stock option or other agreements with the
Corporation or any of its affiliated companies. Amounts which are vested
benefits or which Executive is otherwise entitled to receive under any plan or
program of the Corporation or any of its affiliated companies at or subsequent
to the date on which Executive's employment is terminated shall be payable in
accordance with such plan or program. Anything herein to the contrary
notwithstanding, if Executive becomes entitled to payments pursuant to Section
7.D hereof, the Executive agrees to waive payments under any severance plan or
program of the Corporation.
9. Noncompetition; Nondisclosure; Nonsolicitation.
A. Executive hereby covenants and agrees that, during the
period of Executive's employment with the Corporation and
for one year thereafter (the "Covenant Period"), he shall
not, without the prior written consent of the Corporation,
engage in Competition (as defined below) with the
Corporation. For purposes of this Agreement, if Executive
takes any of the following actions he shall be engaged in
"Competition": engaging in or carrying on, directly or
indirectly, any enterprise, whether as an advisor, principal,
agent, partner, officer, director, employee, stockholder,
associate or consultant to any person, partnership,
corporation or any other business entity, that is principally
engaged in any business operating within the United States
of America, which is involved in business activities which
are the same as, similar to or in competition with the
principal business activities carried on by the Corporation,
or being definitely planned by the Corporation, at the time
of the termination of the Executive's employment; provided,
however, that "Competition" shall not include (i) the passive
ownership of securities in any public enterprise and exercise
of rights appurtenant thereto, so long as such securities
represent no more than five percent of the voting power of all
securities of such enterprise or (ii) the indirect ownership
of securities through ownership of shares in a registered
investment company.
B. Executive shall not, without the Corporation's prior written
consent, disclose or use any non-public confidential
information of or relating to the Corporation, whether
disclosed to or learned by Executive during the course of his
employment or otherwise, so long as such information is not
publicly known or available, except for such disclosures as
are required by law or in connection with Executive's
performance of services to the Corporation hereunder.
Executive further agrees that he shall not make any
statements at any time that disparage the reputation of the
Corporation or any of its affiliates. For purposes of this
Section 9, the term "affiliate" of the Corporation means the
Board, any and all Committees of the Board (the
"Committees") and any and all individual members of either
the Board or any of the Committees, in their capacity as
such, and any employee or officer of the Corporation.
C. Executive hereby covenants and agrees that, during the
Covenant Period, he shall not attempt to influence, persuade
or induce, or assist any other person in so influencing,
persuading or inducing, (i) any customer of the Corporation
to give up, or to not commence, a business relationship with
the Corporation and (ii) if Executive's employment was
terminated by the Corporation with Cause or by Executive
without Good Reason, any employee of the Corporation
(other than Xxxxx Xxx) to cease such employment.
D. Executive agrees that all processes, technologies, designs
and inventions ("Inventions"), including new contributions,
improvements, ideas and discoveries, whether patentable or
not, conceived, developed, invented or made by him during
the Employment Period shall belong to the Corporation,
provided that such Inventions grew out of Executive's work
for the Corporation, are related in any manner to the
business (commercial or experimental) of the Corporation or
are conceived or made on the Corporation's time or with the
use of the Corporation's facilities or materials. Executive
shall further: (a) promptly disclose such Inventions to the
Corporation; (b) assign to the Corporation, without
additional compensation, all patent and other rights to such
Inventions for the United States and foreign countries; (c)
sign all papers necessary to carry out the foregoing; and (d)
give testimony in support of the status of Executive as the
inventor of such Inventions. Executive agrees that he will
not assert any rights to any Invention as having been made
or acquired by him prior to the Effective Date, except for
Inventions, if any, disclosed to the Corporation in writing
prior to the Effective Date.
E. Executive acknowledges and agrees that the remedy at law
available to the Corporation for breach of any of his
obligations under Section 9.A, B, C or D of this Agreement
would be inadequate, and that damages flowing from such
a breach may not readily be susceptible to being measured
in monetary terms. Accordingly, Executive acknowledges,
consents and agrees that, in addition to any other rights or
remedies which the Corporation may have at law, in equity
or under this Agreement, upon adequate proof of his
violation of any provision of Section 9 of this Agreement,
the Corporation shall be entitled to immediate injunctive
relief and may obtain a temporary order restraining any
threatened or further breach, without the necessity of proof
of actual damage.
F. Executive acknowledges and agrees that the covenants set
forth in Section 9A, B, C and D of this Agreement are
reasonable and valid in geographical and temporal scope and
in all other respects. If any of such covenants or such other
provisions of this Agreement are found to be invalid or
unenforceable by a final determination of a court of
competent jurisdiction (i) the remaining terms and provisions
hereof shall be unimpaired and (ii) the invalid or
unenforceable term or provision shall be deemed replaced by
a term or provision that is valid and enforceable and that
comes closest to expressing the intention of the invalid or
unenforceable term or provision.
G. Executive understands that the provisions of Section 9A, B,
C and D of this Agreement may limit his ability to earn a
livelihood in a business similar to the business of the
Corporation but he nevertheless agrees and hereby
acknowledges that (i) such provisions do not impose a
greater restraint than is necessary to protect the goodwill or
other business interests of the Corporation, (ii) such
provisions contain reasonable limitations as to time and
scope of activity to be restrained, (iii) such provisions are
not harmful to the general public, (iv) such provisions are
not unduly burdensome to Executive, and (v) the
consideration provided hereunder is sufficient to compensate
Executive for the restrictions contained in Section 9 of this
Agreement. In consideration of the foregoing and in light of
Executive's education, skills and abilities, Executive agrees
that he shall not assert that, and it should not be considered
that, any provisions of Section 9 otherwise are void,
voidable or unenforceable or should be voided or held
unenforceable.
H. If Executive violates any of the restrictions contained in
Section 9A, B or C of this Agreement, the restrictive period
shall not run in favor of the Executive from the time of the
commencement of any such violation until such time as such
violation shall be cured by the Executive to the satisfaction
of the Corporation.
10. Certain Additional Payments by the Corporation.
A. If it is determined (as hereafter provided) that any payment
or distribution by the Corporation to or for the benefit of
Executive, whether paid or payable or distributed or
distributable pursuant to the terms of this Agreement or
otherwise pursuant to or by reason of any other agreement,
policy, plan, program or arrangement, including without
limitation any stock option, stock appreciation right or
similar right, or the lapse or termination of any restriction
on or the vesting or exercisability of any of the foregoing (a
"Payment"), would be subject to the excise tax imposed by
Section 4999 of the Code (or any successor provision
thereto) or to any similar tax imposed by state or local law,
or any interest or penalties with respect to such excise tax
(such tax or taxes, together with any such interest and
penalties, are hereafter collectively referred to as the
"Excise Tax"), then Executive will be entitled to receive an
additional payment or payments (a "Gross-Up Payment") in
an amount such that, after payment by Executive of all taxes
(including any interest or penalties imposed with respect to
such taxes), including any Excise Tax, imposed upon the
Gross-Up Payment, Executive retains an amount of the
Gross-Up Payment equal to the Excise Tax imposed upon
the Payments.
B. Subject to the provisions of Section 10.F hereof, all
determinations required to be made under this Section 10,
including whether an Excise Tax is payable by Executive
and the amount of such Excise Tax and whether a Gross-Up
Payment is required and the amount of such Gross-Up
Payment, will be made by a nationally recognized firm of
certified public accountants (the "Accounting Firm")
selected by Executive in his sole discretion. Executive will
direct the Accounting Firm to submit its determination and
detailed supporting calculations to both the Corporation and
Executive within 15 calendar days after the date of the
Change in Control or the date of Executive's termination of
employment, if applicable, and any other such time or times
as may be requested by the Corporation or Executive. If the
Accounting Firm determines that any Excise Tax is payable
by Executive, the Corporation will pay the required Gross-
Up Payment to Executive within five business days after
receipt of such determination and calculations. If the
Accounting Firm determines that no Excise Tax is payable
by Executive, it will, at the same time as it makes such
determination, furnish Executive with an opinion that he has
substantial authority not to report any Excise Tax on his
federal, state, local income or other tax return. Any
determination by the Accounting Firm as to the amount of the
Gross-Up Payment will be binding upon the Corporation and
Executive. As a result of the uncertainty in the application
of Section 4999 of the Code (or any successor provision
thereto) and the possibility of similar uncertainty regarding
applicable state or local tax law at the time of any
determination by the Accounting Firm hereunder, it is possible
that Gross-Up Payments which will not have been made by the
Corporation should have been made (an "Underpayment"),
consistent with the calculations required to be made
hereunder. In the event that the Corporation exhausts or fails
to pursue its remedies pursuant to Section 10.F hereof and
Executive thereafter is required to make a payment of any
Excise Tax, Executive will direct the Accounting Firm to
determine the amount of the Underpayment that has occurred and
to submit its determination and detailed supporting
calculations to both the Corporation and Executive as promptly
as possible. Any such Underpayment will be promptly paid by
the Corporation to, or for the benefit of, Executive within
five business days after receipt of such determination and
calculations.
C. The Corporation and Executive will each provide the
Accounting Firm access to and copies of any books, records
and documents in the possession of the Corporation or
Executive, as the case may be, reasonably requested by the
Accounting Firm, and otherwise cooperate with the
Accounting Firm in connection with the preparation and
issuance of the determination contemplated by Section 10.B
hereof.
D. The federal, state and local income or other tax returns filed
by Executive will be prepared and filed on a consistent basis
with the determination of the Accounting Firm with respect
to the Excise Tax payable by Executive. Executive will
make proper payment of the amount of any Excise Tax, and
at the request of the Corporation, provide to the Corporation
true and correct copies (with any amendments) of his federal
income tax return as filed with the Internal Revenue Service
and corresponding state and local tax returns, if relevant, as
filed with the applicable taxing authority, and such other
documents reasonably requested by the Corporation, evidencing
such payment. If prior to the filing of Executive's federal
income tax return, or corresponding state or local tax return,
if relevant, the Accounting Firm determines that the amount of
the Gross-Up Payment should be reduced, Executive will within
five business days pay to the Corporation the amount of such
reduction.
E. The fees and expenses of the Accounting Firm for its
services in connection with the determinations and
calculations contemplated by Sections 10.B and D hereof
will be borne by the Corporation. If such fees and expenses
are initially advanced by Executive, the Corporation will
reimburse Executive the full amount of such fees and
expenses within five business days after receipt from
Executive of a statement therefor and reasonable evidence of
his payment thereof.
F. Executive will notify the Corporation in writing of any claim
by the Internal Revenue Service that, if successful, would
require the payment by the Corporation of a Gross-Up
Payment. Such notification will be given as promptly as
practicable but no later than 10 business days after Executive
actually receives notice of such claim and Executive will
further apprise the Corporation of the nature of such claim
and the date on which such claim is requested to be paid (in
each case, to the extent known by Executive). Executive
will not pay such claim prior to the earlier of (i) the
expiration of the 30-calendar-day period following the date
on which he gives such notice to the Corporation and (ii) the
date that any payment of amount with respect to such claim is
due. If the Corporation notifies Executive in writing prior
to the expiration of such period that it desires to contest
such claim, Executive will:
(vi) provide the Corporation with any written records or
documents in his possession relating to such claim
reasonably requested by the Corporation;
(vii) take such action in connection with contesting such
claim as the Corporation will reasonably request in
writing from time to time, including without limitation
accepting legal representation with respect to such
claim by an attorney competent in respect of
the subject matter and reasonably selected by the
Corporation;
(viii)cooperate with the Corporation in good faith in order
effectively to contest such claim; and
(ix) permit the Corporation to participate in any
proceedings relating to such claim;
provided, however, that the Corporation will bear and pay
directly all costs and expenses (including interest and
penalties) incurred in connection with such contest and will
indemnify and hold harmless Executive, on an after-tax basis,
for and against any Excise Tax or income tax, including
interest and penalties with respect thereto, imposed as a
result of such representation and payment of costs and
expenses. Without limiting the foregoing provisions of this
Section 10.F, the Corporation will control all proceedings
taken in connection with the contest of any claim contemplated
by this Section 10.F and, at its sole option, may pursue or
forego any and all administrative appeals, proceedings,
hearings and conferences with the taxing authority in respect
of such claim (provided that Executive may participate therein
at his own cost and expense) and may, at its option, either
direct Executive to pay the tax claimed and xxx for a refund
or contest the claim in any permissible manner, and Executive
agrees to prosecute such contest to a determination before any
administrative tribunal, in a court of initial jurisdiction
and in one or more appellate courts, as the Corporation will
determine; provided, however, that if the Corporation directs
Executive to pay the tax claimed and xxx for a refund, the
Corporation will advance the amount of such payment to
Executive on an interest-free basis and will indemnify and
hold Executive harmless, on an after-tax basis, from any
Excise Tax or income tax, including interest or penalties with
respect thereto, imposed with respect to such advance; and
provided further, however, that any extension of the statute
of limitations relating to payment of taxes for the taxable
year of Executive with respect to which the contested amount
is claimed to be due is limited solely to such contested
amount. Furthermore, the Corporation's control of any such
contested claim will be limited to issues with respect to
which a Gross-Up Payment would be payable hereunder and
Executive will be entitled to settle or contest,
as the case may be, any other issue raised by the Internal
Revenue Service or any other taxing authority.
G. If, after the receipt by Executive of an amount advanced by
the Corporation pursuant to Section 10.F hereof, Executive
receives any refund with respect to such claim, Executive
will (subject to the Corporation's complying with the
requirements of Section 10.F hereof) promptly pay to the
Corporation the amount of such refund (together with any
interest paid or credited thereon after any taxes applicable
thereto). If, after the receipt by Executive of an amount
advanced by the Corporation pursuant to Section 10.F
hereof, a determination is made that Executive will not be
entitled to any refund with respect to such claim and the
Corporation does not notify Executive in writing of its intent
to contest such denial or refund prior to the expiration of 30
calendar days after such determination, then such advance
will be forgiven and will not be required to be repaid and the
amount of such advance will offset, to the extent thereof, the
amount of Gross-Up Payment required to be paid pursuant
to this Section 10.
11. Successors.
A. This Agreement is personal to Executive and without the prior
written consent of the Corporation shall not be assignable by
Executive otherwise than by will or the laws of descent and
distribution. This Agreement shall inure to the benefit of and
be enforceable by Executive's legal representatives.
B. This Agreement shall inure to the benefit of and be binding
upon the Corporation and its successors.
C. The Corporation will require any successor (whether direct
or indirect, by purchase, merger, consolidation or
otherwise) to all or substantially all of the business and/or
assets of the Corporation to expressly assume and agree to
perform this Agreement in the same manner and to the same
extent that the Corporation would be required to perform it
if no such succession had taken place. As used in this
Agreement, "Corporation" shall mean the Corporation as
hereinbefore defined and any successor to its business and/or
assets as aforesaid which assumes and agrees to perform this
Agreement by operation of law, or otherwise.
12. Miscellaneous.
A. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York without
reference to principles of conflict of laws. The parties
hereto agree that exclusive jurisdiction of any dispute
regarding this Agreement shall be the state or federal courts
located in New York, New York. The Corporation shall
directly pay the fees and expenses of counsel and other
experts retained by Executive in enforcing this Agreement,
as they may be incurred, provided that Executive shall be
required to reimburse the Corporation for any amounts so
paid unless at least one material matter in dispute is
decided in favor of Executive.
B. In the event of any termination of Executive's employment
hereunder, Executive shall be under no obligation to seek
other employment or otherwise mitigate the obligations of
the Corporation under this Agreement, and there shall be no
offset against amounts due Executive under this Agreement
on account of amounts purportedly owing by Executive to
the Corporation. Any amounts due to Executive under this
Agreement upon termination of employment are considered
to be reasonable by the Corporation and are not in the nature
of a penalty.
C. The Corporation will indemnify Executive, to the maximum
extent permitted by applicable law, against all costs, charges
and expenses incurred or sustained by him in connection with
any action, suit or proceeding to which he may be made a party
by reason of his being an officer, director or employee of the
Corporation or of any subsidiary or affiliate of the
Corporation.
D. The captions of this Agreement are not part of the provisions
hereof and shall have no force or effect.
E. This Agreement may not be amended or modified otherwise
than by a written agreement executed by the parties hereto
or their respective successors and legal representatives.
F. All notices and other communications hereunder shall be in
writing and shall be given by hand delivery to the other
party or by registered or certified mail, return receipt
requested, postage prepaid, or by facsimile or nationally
recognized overnight courier service, addressed as follows:
If to Executive:
Xxxxxx Xxxxx
000 Xxxxx Xxxx Xxxx
Xx. Xxxxx, Xxx Xxxx 00000
Facsimile: (000) 000-0000
If to the Corporation:
Triarc Companies, Inc.
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: General Counsel
Facsimile: (000) 000-0000
in either case, with a copy to:
Xxxx, Weiss, Rifkind, Xxxxxxx &
Xxxxxxxx
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx X. Xxxxxx, Esq.
Facsimile: (000) 000-0000
or to such other address as either party shall have furnished
to the other in writing in accordance herewith. Notice and
communications shall be effective when actually received by
the addressee.
G. The invalidity or unenforceability of any provision of this
Agreement shall not affect the validity or enforceability of
any other provision of this Agreement.
H. The Corporation may withhold from any amounts payable under
this Agreement such Federal, state or local taxes as shall be
required to be withheld pursuant to any applicable law or
regulation.
I. This Agreement contains the entire understanding of the
Corporation and Executive with respect to the subject matter
hereof.
IN WITNESS WHEREOF, Executive has hereunto set his hand and the
Corporation has caused this Agreement to be executed in its name on its behalf,
all as of the day and year first above written.
XXXXXX XXXXX
------------------------------
Xxxxxx Xxxxx
TRIARC COMPANIES, INC.
By: XXXXX X. XXXXXX
------------------------
Name: Xxxxx X. Xxxxxx
Title: Executive Vice President
and General Counsel
