-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, ToWiJmLoGC35hJgcDZYhojY2IpW1Toa85Dc1zJeukW+sN7lrNpzJmwRU30XdW/0i 5Xk5QR3hdntk0tzNrGcLFA== 0000030697-05-000202.txt : 20050726 0000030697-05-000202.hdr.sgml : 20050726 20050725183253 ACCESSION NUMBER: 0000030697-05-000202 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20050725 ITEM INFORMATION: Regulation FD Disclosure ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20050726 DATE AS OF CHANGE: 20050725 FILER: COMPANY DATA: COMPANY CONFORMED NAME: TRIARC COMPANIES INC CENTRAL INDEX KEY: 0000030697 STANDARD INDUSTRIAL CLASSIFICATION: RETAIL-EATING & DRINKING PLACES [5810] IRS NUMBER: 380471180 STATE OF INCORPORATION: DE FISCAL YEAR END: 0102 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-02207 FILM NUMBER: 05972421 BUSINESS ADDRESS: STREET 1: 280 PARK AVENUE STREET 2: 24TH FLOOR CITY: NEW YORK STATE: NY ZIP: 10017 BUSINESS PHONE: 212-451-3000 MAIL ADDRESS: STREET 1: 280 PARK AVENUE STREET 2: 24TH FLOOR CITY: NEW YORK STATE: NY ZIP: 10017 FORMER COMPANY: FORMER CONFORMED NAME: DWG CORP DATE OF NAME CHANGE: 19920703 FORMER COMPANY: FORMER CONFORMED NAME: DEISEL WEMMER GILBERT CORP DATE OF NAME CHANGE: 19680820 FORMER COMPANY: FORMER CONFORMED NAME: DWG CIGAR CORP DATE OF NAME CHANGE: 19680820 8-K 1 try8k.txt TRIARC 8-K JULY 25, 2005 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 25, 2005 TRIARC COMPANIES, INC. -------------------------------------------------- (Exact name of registrant as specified in its charter) DELAWARE 1-2207 38-0471180 ----------------- -------------- ------------ (State or Other (Commission (I.R.S. Employer Jurisdiction of File Number) Identification No.) Incorporation) 280 Park Avenue New York, NY 10017 ------------------------------------------------------------------------ (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: (212) 451-3000 N/A ------------------------------------------------------------------------ (Former Name or Former Address, if Changed Since Last Report) Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions: [ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) [ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) [ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) [ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) Item 7.01. Regulation FD Disclosure On July 25, 2005, Triarc Companies, Inc. (the "Company") completed its acquisition of RTM Restaurant Group. A copy of Triarc's press release announcing the completion of the acquisition is being furnished as an exhibit hereto. The information in this Current Report, including the exhibit hereto, is being furnished, not filed, pursuant to Regulation FD. The information in this Current Report, including the exhibit hereto, shall not be incorporated by reference into any registration statement pursuant to the Securities Act of 1933, as amended. The furnishing of the information in this Current Report is not intended to, and does not, constitute a determination or admission that the information in this Current Report is material, or that investors should consider this information before making an investment decision with respect to any security of Triarc. Item 9.01. Financial Statements and Exhibits. (c) Exhibits. 99.1 Press release of Triarc Companies, Inc. dated July 25, 2005. SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on behalf by the undersigned hereunto duly authorized. TRIARC COMPANIES, INC. By: /S/ STUART I. ROSEN -------------------- Stuart I. Rosen Senior Vice President, Associate General Counsel and Secretary Dated: July 25, 2005 EXHIBIT INDEX Exhibit Description - ------- ----------- 99.1 Press release of Triarc Companies, Inc. dated July 25, 2005. EX-99 2 exh99.txt PRESS RELEASE For Immediate Release CONTACT: Anne A. Tarbell (212) 451-3030 www.triarc.com -------------- TRIARC COMPLETES ACQUISITION OF RTM RESTAURANT GROUP, ARBY'S LARGEST FRANCHISEE o Arby's Restaurant Group, Inc. enters into $720 million credit facility New York, NY, July 25, 2005 - Triarc Companies, Inc. (NYSE: TRY; TRY.B) announced today that it has completed its acquisition of RTM Restaurant Group ("RTM"). Triarc, through its subsidiaries, is the franchisor of the Arby's(R) restaurant system, which consists of approximately 3,500 restaurants, and is the owner and operator of 233 Arby's restaurants. RTM is Arby's largest franchisee, with 775 Arby's restaurants in 22 states. Total consideration consisted of $175 million in cash, subject to post closing adjustment, plus approximately 9.7 million shares of Triarc's Class B Common Stock, Series 1 (NYSE: TRY.B), and options to purchase approximately 775,000 shares of Triarc Class B Common Stock, Series 1 (weighted average exercise price of $8.92), which were issued in replacement of existing RTM stock options. The combined value of the Triarc shares and options issued in connection with the RTM acquisition is approximately $152 million, based on a closing price of $15.15 per share as of July 22, 2005. In connection with the RTM acquisition, Arby's Restaurant Group, Inc. ("ARG"), a wholly owned subsidiary of Triarc, also assumed approximately $400 million of RTM net debt, including approximately $184 million of RTM capitalized lease and financing obligations. Triarc provided $135 million in cash to fund the acquisition. ARG funded the remaining cash needed to complete the acquisition, including transaction costs, and is refinancing substantially all of its and RTM's existing indebtedness, with the proceeds from a new $720 million credit facility. This refinancing will include the repayment of approximately $234 million of RTM third-party debt and approximately $71 million of ARG third-party debt as well as the defeasance of the Arby's Franchise Trust, 7.44% insured non-recourse securitization notes (total principal amount of $198 million), which will be redeemed in full on August 22, 2005, and the payment of related prepayment penalties. After giving effect to the closing of the RTM acquisition, ARG will have $620 million outstanding under a seven-year senior secured term loan initially priced at LIBOR plus 225 bps and approximately $175 million of capitalized lease and financing obligations. ARG will also have $100 million of availability under a six-year senior secured revolving credit facility initially priced at LIBOR plus 200 bps (50 bps commitment fee on undrawn amount). For the twelve months ended April 3, 2005, unaudited combined income from continuing operations and unaudited consolidated pro forma adjusted EBITDA (defined as combined operating profit plus the sum of (1) depreciation and amortization, excluding amortization of deferred financing costs, (2) normalizing adjustments, (3) estimated synergies, (4) Triarc's management fee and (5) adjustments related to the RTM transaction, including the estimated impact of purchase accounting and the refinancing) for ARG were approximately $23.4 million and $180.7 million, respectively. Before giving effect to the closing of the RTM acquisition, ARG had unaudited income from continuing operations of $17.7 million for the twelve months ended April 3, 2005. See the attached tables that provide a reconciliation to unaudited historical combined income from continuing operations of ARG and RTM and a reconciliation to unaudited pro forma adjusted EBITDA of the combined company, respectively. In addition, ARG is expected to incur employee related restructuring charges in connection with the acquisition of RTM, which would include severance, retention and relocation costs. The amount of such charges has yet to be finalized but is currently estimated at approximately $10 million. Douglas N. Benham, President and Chief Executive Officer of Arby's since January 2004, will lead ARG as its President and Chief Executive Officer. Prior to joining Arby's, Mr. Benham was the Chief Financial Officer of RTM. Thomas A. Garrett, currently President of RTM, will become ARG's Chief Operating Officer. Todd D. Weyhrich, currently Arby's Chief Financial Officer, Sharron L. Barton, currently RTM's Chief Administrative Officer, and Jordan E. Krolick, currently Arby's Chief Development Officer, will serve in similar capacities for the combined company. It is also expected that Russell V. Umphenour, Jr., RTM's Chief Executive Officer, will join the Triarc Board of Directors. The ARG management team, which will consist of management from both Arby's and RTM, has an average of 15 years of quick service restaurant experience and an average of 14 years with Arby's. The combined company, the franchisor of the Arby's restaurant system and the owner and operator of over 1,000 Arby's restaurants located in the United States, will be headquartered in Atlanta, GA. Commenting on the RTM acquisition, Nelson Peltz, Triarc's Chairman and Chief Executive Officer, said: "This accretive transaction presents a unique opportunity to combine the ownership and management of our leading national quick service restaurant brand with the operational excellence of its largest franchisee. As a result of the transaction, the combined company should be positioned to implement multiple growth initiatives, to benefit from scale efficiencies and, working with franchisees, to refine operational practices across the franchise system. We are also very pleased with the strong market response to Arby's Restaurant Group's new financing. The credit facility gives Arby's both flexibility and liquidity to fund future growth." Commenting on the transaction, Russell V. Umphenour, Jr., RTM's Chief Executive Officer, said: "The acquisition of RTM by Arby's is a natural and logical next step in Arby's 40-year brand history. We are delighted to be on the same team as our friends and long time business associates, Nelson Peltz and Peter May and their team at Triarc and Arby's." Douglas N. Benham, Arby's President and Chief Executive Officer, said: "Arby's acquisition of RTM will create a large, fully integrated and growing restaurant company. As a result of the RTM acquisition, we see many future opportunities to continue to improve and accelerate unit development. We also believe we should be well positioned to improve our brand equity and that system-wide profitability should continue to increase. We look forward to effecting these value-enhancing changes with our franchisees." Triarc is a holding company and, through its subsidiaries, the franchisor of the Arby's(R) restaurant system and, following the acquisition of RTM Restaurant Group, the owner and operator of over 1,000 Arby's restaurants located in the United States. Triarc also owns an approximate 64% capital interest in Deerfield & Company LLC, a Chicago-based asset manager offering a diverse range of fixed income and credit-related strategies to institutional investors with $8.8 billion under management as of May 1, 2005. # # # Notes and Table To Follow NOTES TO PRESS RELEASE ---------------------- 1. The description of the RTM acquisition contained herein is only a summary and is qualified in its entirety by reference to the definitive agreements relating to the acquisition, copies of which will be filed by us with the Securities and Exchange Commission as exhibits to our current and/or periodic filings under the Securities Exchange Act of 1934, as amended. 2. There can be no assurance RTM will be successfully integrated into our existing operations. 3. Combined income from continuing operations and pro forma adjusted EBITDA are derived from the unaudited consolidated financial statements of ARG and the preliminary unaudited combined financial statements (which are subject to further change and/or adjustment) of RTM. Triarc will file, among other things, pro forma financial information following the completion of the RTM acquisition as required by the relevant Form 8-K rules. The combined income from continuing operations and pro forma adjusted EBITDA that are being furnished herewith are subject to adjustments and may differ from the information that will be filed following completion of the RTM acquisition. The adjustments used to determine the combined income from continuing operations and pro forma adjusted EBITDA are based on preliminary estimates and will likely differ from the adjustments that will be included in the pro forma financial information that is included in the subsequent Form 8-K. In addition, ARG is expected to incur restructuring charges of approximately $10 million in connection with the acquisition of RTM. The amount of such charges included in this press release is only an estimate and has yet to be finalized; the final amount of such charges could vary materially from such estimate. When RTM is fully integrated into ARG, actual results may vary materially from the expectations contained herein. 4. The statements in this press release that are not historical facts, including, most importantly, information concerning possible or assumed future results of operations of Triarc Companies, Inc. and its subsidiaries (collectively, "Triarc" or the "Company") and statements preceded by, followed by, or that include the words "may," "believes," "plans," "expects," "anticipates" or the negation thereof, or similar expressions, constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995 (the "Reform Act"). All statements that address operating performance, events or developments that are expected or anticipated to occur in the future, including statements relating to revenue growth, earnings per share growth or statements expressing general optimism about future operating results, are forward-looking statements within the meaning of the Reform Act. These forward-looking statements are based on our current expectations, speak only as of the date of this press release and are susceptible to a number of risks, uncertainties and other factors. Our actual results, performance and achievements may differ materially from any future results, performance or achievements expressed or implied by such forward-looking statements. For those statements, we claim the protection of the safe harbor for forward-looking statements contained in the Reform Act. Many important factors could affect our future results and could cause those results to differ materially from those expressed in the forward-looking statements contained herein. Such factors include, but are not limited to, the following: o competition, including pricing pressures and the potential impact of competitors' new units on sales by Arby's(R) restaurants; o consumers' perceptions of the relative quality, variety and value of the food products the Company offers; o success of operating initiatives; o development costs; o advertising and promotional efforts; o brand awareness; o the existence or absence of positive or adverse publicity; o new product and concept development by the Company and its competitors, and market acceptance of such new product offerings and concepts; o changes in consumer tastes and preferences, including changes resulting from concerns over nutritional or safety aspects of beef, poultry, french fries or other foods or the effects of food-borne illnesses such as "mad cow disease" and avian influenza or "bird flu"; o changes in spending patterns and demographic trends; o the business and financial viability of key franchisees; o the timely payment of franchisee obligations due to the Company; o availability, location and terms of sites for restaurant development by the Company and its franchisees; o the ability of the Company's franchisees to open new restaurants in accordance with their development commitments, including the ability of franchisees to finance restaurant development; o delays in opening new restaurants or completing remodels; o anticipated or unanticipated restaurant closures by the Company and its franchisees; o the Company's ability to identify, attract and retain potential franchisees with sufficient experience and financial resources to develop and operate Arby's restaurants; o changes in business strategy or development plans, and the willingness of the Company's franchisees to participate in its strategy; o business abilities and judgment of the Company's and its franchisees' management and other personnel; o availability of qualified restaurant personnel to the Company and to its franchisees; o the Company's ability, if necessary, to secure alternative distribution of supplies of food, equipment and other products to Arby's restaurants at competitive rates and in adequate amounts, and the potential financial impact of any interruptions in such distribution; o changes in commodity (including beef), labor, supplies and other operating costs and availability and cost of insurance; o adverse weather conditions; o changes in legal or self-regulatory requirements, including franchising laws, accounting standards, environmental laws, overtime rules, minimum wage rates and taxation rates; o the costs, uncertainties and other effects of legal, environmental and administrative proceedings; o the impact of general economic conditions on consumer spending, including a slower consumer economy and the effects of war or terrorist activities; o the Company's ability to identify appropriate acquisition targets in the future and to successfully integrate any future acquisitions into its existing operations; and o other risks and uncertainties affecting the Company referred to in its Annual Report on Form 10-K for the fiscal year ended January 2, 2005 (see especially "Item 1. Business--Risk Factors" and "Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations") and in its other current and periodic filings with the Securities and Exchange Commission, all of which are difficult or impossible to predict accurately and many of which are beyond the Company's control. All future written and oral forward-looking statements attributable to us or any person acting on our behalf are expressly qualified in their entirety by the cautionary statements contained or referred to above. New risks and uncertainties arise from time to time, and it is impossible for us to predict these events or how they may affect us. We assume no obligation to update any forward-looking statements after the date of this press release as a result of new information, future events or developments, except as required by federal securities laws. In addition, it is our policy generally not to make any specific projections as to future earnings, and we do not endorse any projections regarding future performance that may be made by third parties. Arby's Restaurant Group, Inc. Reconciliation to Unaudited Historical ARG/RTM Combined Twelve Months Ended April 3, 2005 (In Thousands) Adjustments for RTM Reclassifications, Eliminations Historical ARG as RTM as and Excluded ARG/RTM Reported Reported Items(a) Combined -------- -------- -------------- --------- Revenues: Net sales $ 210,056 $ 795,522 $ -- $ 1,005,578 Royalties and franchise and related fees 102,040 -- (29,716) 72,324 ------------- ----------- ----------- ----------- 312,096 795,522 (29,716) 1,077,902 ------------- ----------- ----------- ----------- Costs and expenses: Cost of sales, excluding depreciation and amortization 164,401 642,109 (78,882) 727,628 Advertising and selling 17,003 -- 50,118 67,121 General and administrative, excluding depreciation and amortization 55,544 84,339 (2,704) 137,179 Depreciation and amortization, excluding amortization of deferred financing costs 10,451 28,421 (1,524) 37,348 Impairment of assets other than goodwill 3,382 1,100 -- 4,482 ------------- ----------- ----------- ----------- 250,781 755,969 (32,992) 973,758 ------------- ----------- ----------- ----------- Operating profit 61,315 39,553 3,276 104,144 Interest expense (26,958) (35,651) (350) (62,959) Insurance expense related to long-term debt (3,787) -- -- (3,787) Interest and other income, net (931) 1,198 53 320 ------------- ----------- ----------- ----------- Income from continuing operations before income taxes 29,639 5,100 2,979 37,718 Provision for income taxes (11,978) (2,124) (252) (14,354) ------------- ----------- ----------- ----------- Income from continuing operations $ 17,661 $ 2,976 $ 2,727 $ 23,364 ============= =========== =========== ===========
(Continued on following page) Arby's Restaurant Group, Inc. Reconciliation of Unaudited Pro Forma Adjusted EBITDA Twelve Months Ended April 3, 2005 (In Thousands) ARG and Reversal of RTM Historical Triarc Combined Adjustments ARG/RTM Normalizing Management and for the RTM Combined Adjustments(c) Synergies(d) Fee(e) Normalized Transaction Pro Forma -------- ----------- ------------ ---------- ---------- ------------ --------- Revenues: Net sales $1,005,578 $ (18,300) $ -- $ -- $ 987,278 $ -- $ 987,278 Royalties and franchise and related fees 72,324 (1,300) -- -- 71,024 -- 71,024 --------- --------- ------ ------- --------- ------- --------- 1,077,902 (19,600) -- -- 1,058,302 1,058,302 --------- --------- ------ ------- --------- ------- ---------- Costs and expenses: Cost of sales, excluding depreciation and amortization 727,628 (15,500) -- -- 712,128 (1,083) 711,045 Advertising and selling 67,121 (200) -- -- 66,921 -- 66,921 General and administrative, excluding depreciation and amortization 137,179 (23,500) (9,000) (5,000) 99,679 -- 99,679 Depreciation and amortization, excluding amortization of deferred financing costs 37,348 -- -- -- 37,348 4,641 41,989 Impairment of assets other than goodwill 4,482 (4,482) -- -- -- -- -- --------- --------- ------ ------- --------- ------- --------- 973,758 (43,682) (9,000) (5,000) 916,076 3,558 919,634 --------- --------- ------ ------- --------- ------- --------- Operating profit 104,144 24,082 9,000 5,000 142,226 (3,558) 138,668 Interest expense (62,959) -- -- -- (62,959) 8,032 (54,927) Insurance expense related to long-term debt (3,787) -- -- -- (3,787) 3,787 -- Interest and other income, net 320 -- -- -- 320 -- 320 --------- --------- ------ ------- --------- ------- --------- Income from continuing operations before income taxes 37,718 24,082 9,000 5,000 75,800 8,261 84,061 Provision for income taxes (14,354) (9,368) (3,501) (1,945) (29,168) (5,947) (35,115) --------- --------- ------ ------- --------- ------- -------- Income from continuing operations $ 23,364 $ 14,714 $ 5,499 $ 3,055 $ 46,632 $ 2,314 $ 48,946 ========= ========= ======= ======= ======== ======= Reconciliation of income from continuing operations to Adjusted EBITDA: Provision for income taxes 35,115 Interest and other income, net (320) Interest expense 54,927 Depreciation and amortization, excluding amortization of deferred financing costs 41,989 --------- Adjusted EBITDA (b) $ 180,657 ========= Calculation of Adjusted EBITDA: Pro forma operating profit, as adjusted $ 138,668 Pro forma depreciation and amortization, excluding amortization of deferred financing costs, as adjusted 41,989 --------- Adjusted EBITDA $ 180,657 ========= (a) Reflects reclassifications of RTM amounts for consistency with ARG, elimination of intercompany income and expense items between ARG and RTM and adjustments for certain operations of RTM not included in the acquisition. (b) EBITDA consists of operating profit plus depreciation and amortization. Adjusted EBITDA represents operating profit plus the sum of (1) depreciation and amortization, excluding amortization of deferred financing costs, (2) normalizing adjustments, (3) estimated synergies, (4) Triarc's management fee and (5) adjustments related to the RTM transaction, including the estimated impact of purchase accounting and the refinancing. We use EBITDA as an internal measurement of operating performance as well as assisting investors in the understanding of our performance by using a measure that is unaffected by changes in capital structure or capital investment cycles. This term, as we define it, may not be comparable to a similarly titled measure used by other companies and is not a measure of performance or liquidity presented in accordance with GAAP. Adjusted EBITDA should not be used as a substitute for income from continuing operations, net cash provided by or used in operations or other financial data prepared in accordance with GAAP. (c) Normalizing adjustments include non-recurring adjustments, efficiency improvements and adjustments to compensation expenses reflecting levels consistent with public companies. (d) Reflects the elimination of duplicate positions and offices net of estimated additional costs. (e) Reflects the add-back of fees charged to ARG as a wholly-owned subsidiary of Triarc under a corporate services agreement.
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