UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15 (d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported) July 22, 2004
TRIARC COMPANIES, INC.
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(Exact name of registrant as specified in its charter)
DELAWARE 1-2207 38-0471180
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(State or other (Commission (I.R.S. Employer
jurisdiction of File No.) Identification No.)
incorporation)
280 Park Avenue
New York, NY 10017
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (212) 451-3000
N/A
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(Former name or former address, if changed since last report)
Item 2. Acquisition of Assets.
On July 22, 2004, Triarc Companies, Inc. ("Triarc") completed its
acquisition of a majority interest in Deerfield & Company LLC ("Deerfield"), a
Chicago-based alternative asset manager, from Sachs Capital Management LLC
("SCM"), Deerfield Partners Fund II LLC ("DPF II"), Scott A. Roberts and Marvin
Shrear. Deerfield, through Deerfield Capital Management LLC ("DCM"), its
operating subsidiary, offers a diverse range of alternative fixed income
strategies to institutional investors. As of July 1, 2004, DCM had over $8.1
billion in assets under management. Deerfield generated revenues of
approximately $36.9 million for the 12 months ended December 31, 2003.
The purchased interests represent as of the date hereof approximately
64% of the outstanding membership interests and in excess of 90% of the
outstanding voting power of Deerfield. The remainder of the economic and voting
interests in Deerfield will be retained or owned by senior management of
Deerfield or their affiliates.
The purchase price for the acquisition was approximately $86.5 million,
which reflects an enterprise value of approximately $145 million, subject to
adjustment based on the amount of unrestricted cash on hand and indebtedness as
of the closing date, as provided in the definitive purchase agreement. The
purchase price was paid in cash at the closing from Triarc's cash on hand. The
acquisition was the result of an arm's length negotiated transaction pursuant to
a Purchase Agreement, dated as of June 26, 2004, by and among Triarc, SCM, DPF
II, Mr. Roberts, Mr. Shrear and Gregory H. Sachs (as amended, the "Purchase
Agreement").
As further described in the Fourth Amended and Restated Operating
Agreement of Deerfield, dated as of June 26, 2004 (as amended, the "Operating
Agreement"), Triarc will be entitled to designate a majority of the members of
the board of directors of Deerfield. Deerfield's current management, including
its Chairman and Chief Executive Officer Gregory H. Sachs, its President Scott
Roberts and its Chief Investment Officer Jonathan Trutter, and portfolio
management teams, will remain intact and will continue to oversee Deerfield's
day-to-day operations.
The Operating Agreement further provides that, commencing on the fifth
anniversary of the closing of the acquisition, Triarc will have certain rights
to acquire the membership interests of Deerfield owned by Mr. Sachs (the "Sachs
Interest") and Mr. Roberts (the "Roberts Interest"), which represent in the
aggregate as of the date hereof approximately 35% of the outstanding membership
interests. In addition, commencing on the third anniversary of the closing of
the transaction, Messrs. Sachs and Roberts will have certain rights to require
Triarc to acquire the Sachs Interest and the Roberts Interest. In each case, the
rights are exercisable at a price equal to the then current fair market value of
the Sachs Interest or the Roberts Interest (subject to certain exceptions in the
case of the Sachs Interest). Triarc's right to acquire the Sachs Interest and
the Roberts Interest, and Messrs. Sachs' and Roberts' rights to require Triarc
to acquire such interests, may be accelerated in full upon the occurrence of
certain specified events.
In connection with the acquisition, and as further described in a
Commitment Agreement, dated as of June 26, 2004, among Triarc, SCM, Roberts and
DCM (the "Commitment Agreement"), Triarc has also committed to invest $100
million to seed a new multi-strategy hedge fund to be managed by Deerfield.
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In addition, Mr. Sachs, the Chairman and Chief Executive Officer of DCM
and Deerfield, entered into a new five year employment agreement with Deerfield
and DCM (as amended, the "Sachs Employment Agreement"). As further described in
the Sachs Employment Agreement, Mr. Sachs will be entitled to an annual base
salary of $1,000,000 and, commencing with the 2005 fiscal year, an annual bonus
not to exceed $5,000,000 based on the EBITDA (as defined therein) of Deerfield
and its consolidated subsidiaries during the applicable fiscal year, subject in
part to the adoption by Triarc's stockholders of an amendment to Triarc's 1999
Executive Bonus Plan.
A copy of the press release announcing the consummation of the
transaction, the Sachs Employment Agreement, an amendment to the definitive
purchase agreement and a supplement to the Operating Agreement are being filed
as exhibits hereto and are incorporated herein by reference. Copies of the
definitive purchase agreement, the Operating Agreement and the Commitment
Agreement were filed previously by Triarc with the Securities and Exchange
Commission on a Current Report on Form 8-K dated June 28, 2004.
Item 7. Financial Statements and Exhibits.
(a) Financial Statements.
The financial statements required to be filed with this Current
Report on Form 8-K are not included in this Current Report and will be filed by
amendment as soon as practicable but not later than sixty (60) days from the
date this Current Report was required to be filed.
(b) Pro Forma Financial Information.
Not applicable.
(c) Exhibits.
Exhibit
NO. DESCRIPTION
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10.6 - Employment Agreement, dated as of June 26, 2004, by and
among Deerfield & Company LLC, Deerfield Capital
Management LLC and Gregory H. Sachs.
10.7 - Supplement, dated as of July 14, 2004, to the Employment
Agreement, dated as of June 26, 2004, by and among
Deerfield & Company LLC, Deerfield Capital Management LLC
and Gregory H. Sachs.
10.8 - First Amendment to Purchase Agreement, dated as of July
22, 2004, by and among Triarc Companies, Inc., Sachs
Capital Management LLC, Deerfield Partners Fund II LLC,
Scott A. Roberts, Marvin Shrear and Gregory H. Sachs.
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10.9 - First Supplement to Fourth Amended and Restated Operating
Agreement of Deerfield & Company LLC, dated as of July
22, 2004.
99.1 - Press release dated July 22, 2004.
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Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
TRIARC COMPANIES, INC.
By: /S/ Stuart Rosen
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Name: Stuart Rosen
Title: Senior Vice President
and Secretary
Date: July 22, 2004
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EXHIBIT INDEX
Exhibit
NO. DESCRIPTION
--- -----------
10.6 - Employment Agreement, dated as of June 26, 2004, by and among
Deerfield & Company LLC, Deerfield Capital Management LLC and
Gregory H. Sachs.
10.7 - Supplement, dated as of July 14, 2004, to the Employment
Agreement, dated as of June 26, 2004, by and among Deerfield &
Company LLC, Deerfield Capital Management LLC and Gregory H.
Sachs.
10.8 - First Amendment to Purchase Agreement, dated as of July 22,
2004, by and among Triarc Companies, Inc., Sachs Capital
Management LLC, Deerfield Partners Fund II LLC, Scott A.
Roberts, Marvin Shrear and Gregory H. Sachs.
10.9 - First Supplement to Fourth Amended and Restated Operating
Agreement of Deerfield & Company LLC, dated as of July 22,
2004.
99.1 - Press release dated July 22, 2004.
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