<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No. )
Filed by the Registrant / /
Filed by a party other than the Registrant / /
Check the appropriate box:
/ / Preliminary Proxy Statement
/ / Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Section 240.14a-11(c) or Section
240.14a-12
BRAZIL FAST FOOD CORP.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
/ / No fee required
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(1)
and 0-11
(1) Title of each class of securities to which transaction applies:
------------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
------------------------------------------------------------------------
(5) Total fee paid:
------------------------------------------------------------------------
/ / Fee paid previously with preliminary materials.
/ / Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
------------------------------------------------------------------------
(2) Form, Schedule or Registration Statement No.:
------------------------------------------------------------------------
(3) Filing Party:
------------------------------------------------------------------------
(4) Date Filed:
------------------------------------------------------------------------
<PAGE>
[LOGO]
BRAZIL FAST FOOD CORP.
PRAIA DO FLAMENGO
200-22O. ANDAR
CEP 22210-030
RIO DE JANEIRO, BRAZIL
------------------------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON JUNE 6, 1997
------------------------
To the Stockholders of
BRAZIL FAST FOOD CORP.:
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders (the
"Meeting") of BRAZIL FAST FOOD CORP., a Delaware corporation (the "Company"),
will be held at the Rio Atlantica Hotel (Buzios Salon-Floor C), Av. Atlantica,
2964, Copacabana, Rio de Janeiro, Brazil, on Friday, June 6, 1997 at the hour of
10:00 a.m., for the following purposes:
1) To elect five directors of the Company for the ensuing year.
2) To transact such other business as may properly come before the Meeting.
Only stockholders of record at the close of business on May 9, 1997 are
entitled to notice of and to vote at the Meeting or any adjournment thereof.
Rogerio Carlos Lamim Braz
SECRETARY
Rio de Janeiro, Brazil
May 12, 1997
WHETHER OR NOT YOU PLAN TO ATTEND THE MEETING, PLEASE SIGN AND DATE THE ENCLOSED
PROXY, WHICH IS SOLICITED BY THE BOARD OF DIRECTORS OF THE COMPANY, AND PROMPTLY
RETURN IT IN THE PRE-ADDRESSED ENVELOPE PROVIDED FOR THAT PURPOSE. ANY
STOCKHOLDER MAY REVOKE HIS PROXY AT ANY TIME BEFORE THE MEETING BY GIVING
WRITTEN NOTICE TO SUCH EFFECT, BY SUBMITTING A SUBSEQUENTLY DATED PROXY OR BY
ATTENDING THE MEETING AND VOTING IN PERSON.
<PAGE>
BRAZIL FAST FOOD CORP.
PRAIA DO FLAMENGO
200-22O. ANDAR
CEP 22210-030
RIO DE JANEIRO, BRAZIL
------------------------
PROXY STATEMENT
------------------------
This Proxy Statement is being mailed on or about May 12, 1997 to all
stockholders of record at the close of business on May 9, 1997 in connection
with the solicitation by the Board of Directors (the "Board") of Brazil Fast
Food Corp., (the "Company") of Proxies for the Annual Meeting of Stockholders
(the "Meeting") to be held on June 6, 1997. Proxies will be solicited by mail,
and all expenses of preparing and soliciting such Proxies will be paid by the
Company. All Proxies duly executed and received by the persons designated as
proxy therein will be voted on all matters presented at the Meeting in
accordance with the specifications given therein by the person executing such
Proxy or, in the absence of specified instructions, will be voted for the named
nominees to the Board. The Board does not know of any other matter that may be
brought before the Meeting but, in the event that any other matter should come
before the Meeting, or any nominee should not be available for election, the
persons named as proxy will have authority to vote all Proxies not marked to the
contrary in their discretion as they deem advisable. Any stockholder may revoke
his Proxy at any time before the Meeting by written notice to such effect
received by the Company at the address set forth above. Attn: Corporate
Secretary, by delivery of a subsequently dated Proxy or by attending the Meeting
and voting in person.
The total number of shares of the Company's Common Stock outstanding as of
May 9, 1997 was 10,884,525. The Common Stock is the only class of securities of
the Company entitled to vote, each share being entitled to one non-cumulative
vote. Only stockholders of record as of the close of business on May 9, 1997
will be entitled to vote. A majority of the shares of Common Stock outstanding
and entitled to vote, or 5,442,263 shares, must be present at the Meeting in
person or by proxy in order to constitute a quorum for the transaction of
business. Abstentions and broker nonvotes will be counted for purposes of
determining the presence or absence of a quorum for the transaction of business.
Assuming the presence of a quorum, a vote of a majority of the shares of Common
Stock present and voting, in person or by proxy, at the Meeting is required to
pass upon each of the matters presented. Abstentions will be counted in
tabulations of the votes cast on each of the proposals presented at the Meeting,
whereas broker nonvotes will not be counted for purposes of determining whether
a proposal has been approved. "Broker nonvotes" are proxies received from
brokers who, in the absence of specific voting instructions from beneficial
owners of shares held in brokerage name, have declined to vote such shares in
those instances where discretionary voting by brokers is permitted.
A list of stockholders entitled to vote at the meeting will be available at
the Company's offices, Praia do Flamengo, 200-22o. Andar, CEP 22210-030, Rio de
Janeiro, Brazil, for a period of ten days prior to the Meeting and at the
Meeting itself for examination by any stockholder.
1
<PAGE>
ELECTION OF DIRECTORS
Five directors are to be elected at the Meeting to serve for a term of one
year or until their respective successors are elected and qualified.
INFORMATION CONCERNING NOMINEES
The following table sets forth the positions and offices presently held with
the Company by each nominee, his age and his tenure as a director.
<TABLE>
<CAPTION>
POSITIONS AND OFFICES DIRECTOR
NAME AGE PRESENTLY HELD WITH THE COMPANY SINCE
- ------------------------------------------------ --- ------------------------------------------------ -----------
<S> <C> <C> <C>
Omar Carneiro da Cunha.......................... 50 Chairman of the Board 1996
Peter van Voorst Vader.......................... 43 Chief Executive Officer and Director 1996
Ian S. Barnett.................................. 42 Director 1996
Lawrence Burstein............................... 54 Director 1992
Jose Ricardo Bosquet Bomeny..................... 55 Director 1996
</TABLE>
OMAR CARNEIRO DA CUNHA has been President of ATT Brazil since September
1995. From 1967 until 1994, Mr. Carneiro da Cunha held a variety of positions
with Shell Brasil S.A. and its affiliates including serving as President of
Shell Brasil S.A. from 1992 until 1994. Mr. Carneiro da Cunha received a B.A. in
Economics from the University of Political and Economical Sciences of Rio de
Janeiro and a degree in Finance Administration from Fundacao Getulio Vargas.
PETER J.F. VAN VOORST VADER has been Chief Executive Officer of the Company
since March 1996. Prior thereto and from 1995, he was an independent business
consultant. From 1992 until 1995, Mr. van Voorst Vader was a Retail Sales
manager for Shell Nederland Verkoopmaatschappij B.V., overseeing the operations
of 800 gas stations. From 1985 until 1992, Mr. van Voorst Vader held several
positions with Shell Brasil including Sales Promotion Manager, Marketing
Communications Manager and Retail Development Manager. From 1983 until 1985, he
was employed by Shell International Petroleum Company as a Regional Brand and
Communications Assistant for Africa, the Middle East, the Far East and South
America. From 1980 to 1983, Mr. van Voorst Vader was a Commercial Assistant for
Shell Italia. Mr. van Voorst Vader received a B.S. in Hotel Management from both
the Hogere Hotel School in The Hague, Holland and Florida International
University. Mr. van Voorst Vader also has a Masters Degree in International
Business from Florida International University.
IAN S. BARNETT is a founder of Heptagon Investments Limited and has been a
director of such concern since February 1992. Between January 1991 and February
1992, Mr. Barnett was a private investor. From September 1986 to January 1991,
Mr. Barnett was employed by UBS (Securities) Ltd. (now UBS Ltd.), the investment
banking entity of Union Bank of Switzerland in London, where he developed
corporate finance activity in the Nordic countries. From June 1979 until August
1985, Mr. Barnett was with the Toronto-Dominion Bank, where he held a number of
positions in the Bank's Latin American Division, including business development
throughout Latin America. Mr. Barnett is a graduate of Queen's University,
Canada, and received an MBA from INSEAD, Fontainebleau, France.
LAWRENCE BURSTEIN is and since March 1996 has been President, a director and
the principal shareholder of Unity Venture Capital Associates Ltd., a private
investment banking firm. He is also President, a director and principal
shareholder of Unity First Acquisition Corp., a publicly held "blank check"
company presently seeking to effect a Business Combination. Mr. Burstein, who
was also President of the Company from its inception until March 1996, is a
director of four other public companies, being, respectively, CAS Medical
Systems, Inc. engaged in the manufacture and marketing of blood pressure
monitors and other medical products principally for the neonatal market, The MNI
Group Inc., engaged in the marketing of specially formulated health foods, T-HQ,
Inc., a developer of electronic game cartridges, and USCI, Inc., engaged in
centralized automated computer-based cellular telephone activation services on a
nationwide
2
<PAGE>
basis to mass merchandisers and direct response marketing companies. Mr.
Burstein received an LL.B. from Columbia Law School.
JOSE RICARDO BOSQUET BOMENY founded BigBurger Ltda. in 1975 and was its
President until its acquisition by the Company in July 1996. He currently owns
another fast food business, which is non-competitive with the business of the
Company, as well as six gas stations and two parking lots.
Incumbent directors stand for election at the Company's Annual Meeting of
Stockholders and will serve until their successors are duly elected and
qualified.
INFORMATION CONCERNING THE BOARD
The Board held four meetings during the year ended December 31, 1996. All
then incumbent directors attended 100% of such meetings.
The Audit Committee of the Board is charged with the review of the
activities of the Company's independent auditors (including, but not limited to,
fees, services and scope of audit). The Audit Committee is presently composed of
Messrs. Carneiro da Cunha and van Voorst Vader, the latter serving in an EX
OFFICIO, non-voting capacity. The Audit Committee did not meet during 1996.
The Company does not have a nominating committee, charged with the search
for and recommendation to the Board of potential nominees for Board positions, a
compensation committee charged with reviewing and recommending to the Board
compensation programs for the Company's officers or a stock option committee
charged with selecting option recipients and the exercise prices and other terms
and conditions of their respective options. These functions are performed by the
Board as a whole.
DIRECTORS' COMPENSATION
Directors receive no cash compensation for attending Board meetings other
than reimbursement of reasonable expenses incurred in attending such meetings.
In order to compensate members of the Board for the first year of service as
such, options to purchase 17,500 shares of the Company's Common Stock were
granted to each director other than Omar Carneiro da Cunha on October 23, 1996.
Mr. Carneiro da Cunha, who serves as Chairman of the Board, was granted options
to purchase 25,000 shares of the Company's Common Stock on that date. All such
options are exercisable at $3.25 per share, the market price of the Company's
Common Stock on the date of grant, at any time and from time to time through
October 23, 2001.
The Company presently anticipates that it will continue to compensate its
directors on an annual basis for their services through grants of five-year
options, exercisable at the prevailing market price of the Company's Common
Stock on the respective grant dates, with the next such grants scheduled to be
made on the date of the Meeting.
EXECUTIVE COMPENSATION
Set forth below is the aggregate compensation for services rendered in all
capacities to the Company during the years ended December 31, 1996, 1995 and
1994 by its Chief Executive Officer and each of its two most highly compensated
executive officers whose compensation exceeded $100,000 during the year ended
December 31, 1996:
3
<PAGE>
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG-TERM COMPENSATION
ANNUAL COMPENSATION AWARDS PAYOUTS
------------------------------------------ -------------------------- -------------
OTHER RESTRICTED LONG TERM
NAME AND FISCAL ANNUAL STOCK NUMBER OF INCENTIVE
PRINCIPAL POSITION YEAR SALARY(1) BONUS COMPENSATION AWARDS OPTIONS PAYOUTS
- -------------------------------- ----------- ---------- ----------- ----------------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C> <C>
Peter van Voorst Vader.......... 1996 $ 114,750 $ -- -- -- 167,500 --
Chief Executive Officer 1995 $ -- $ -- -- -- -- --
1994 $ -- $ -- -- -- -- --
Rogerio Carlos Lamim Braz....... 1996 $ 140,466 $ -- -- -- 120,000 --
President 1995 $ -- $ -- -- -- -- --
1994 $ -- $ -- -- -- -- --
Marcos Bastos Rocha............. 1996 $ 90,553 $ -- -- -- 35,000 --
Vice President--Finance 1995 $ -- $ -- -- -- -- --
1994 $ -- $ -- -- -- -- --
<CAPTION>
ALL
NAME AND OTHER
PRINCIPAL POSITION COMPENSATION
- -------------------------------- -------------
<S> <C>
Peter van Voorst Vader.......... $ --
Chief Executive Officer $ --
$ --
Rogerio Carlos Lamim Braz....... $ --
President $ --
$ --
Marcos Bastos Rocha............. $ 20,000(2)
Vice President--Finance $ --
$ --
</TABLE>
- ------------------------
(1) Commencing March 20, 1996 through December 31, 1996.
(2) Represents a lump-sum payment intended to compensate Mr. Rocha for the loss
of a like amount bonus that he would have been entitled to receive from his
prior employer had he not accepted employment by the Company.
Set forth below is information with respect to grants of stock options
during the year ended December 31, 1996:
OPTIONS GRANTS IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
PERCENT
OF TOTAL
PERCENT
OF TOTAL
NUMBER OF OPTIONS EXERCISE
SHARES GRANTED TO OR GRANT
UNDERLYING EMPLOYEES BASE DATE
OPTIONS IN FISCAL PRICE EXPIRATION PRESENT
NAME GRANTED YEAR ($/SH) DATE VALUE(1)
- ----------------------------------------------------- ----------- ----------- ---------- ----------- ----------
<S> <C> <C> <C> <C> <C> <C>
Peter van Voorst Vader............................... 150,000 30.43% $ 5 5/32 3/19/01 $ 694,500
17,500 $ 3 1/4 10/23/01 $51,275
Rogerio Carlos Lamim Braz............................ 120,000 52.17% $ 5 5/32 3/19/01 $ 548,400
Marcos Bastos Rocha.................................. 35,000 8.70% $ 4 13/16 4/4/01 $ 158,550
</TABLE>
- ------------------------
(1) The fair value of each option grant is estimated on the date of grant using
the Black Scholes option pricing model with the following weighted average
assumptions used for grants in 1996: risk free interest rate of 6.26%; no
expected dividend yield; expected lives of 5 years; and no expected stock
price volatility of 142%.
Set forth below is further information with respect to unexercised options
to purchase the Company's Common Stock under the Company's stock option plan:
4
<PAGE>
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR END OPTION VALUES
<TABLE>
<CAPTION>
VALUE OF
UNEXERCISED
NUMBER OF UNEXERCISED IN-THE-MONEY
NUMBER OF SECURITIES UNDERLYING OPTIONS
SHARES OPTIONS AT DECEMBER 31, AT DECEMBER 31,
ACQUIRED 1996 1996
ON VALUE -------------------------- ---------------
NAME EXERCISE REALIZED EXERCISABLE UNEXERCISABLE EXERCISABLE
- --------------------------------------------- --------------- ------------- ----------- ------------- ---------------
<S> <C> <C> <C> <C> <C>
Peter van Voorst Vader....................... -- -- 17,500 150,000 --
Rogerio Carlos Lamim Braz.................... -- -- 30,000 90,000 --
Marcos Bastos Rocha.......................... -- -- 5,000 30,000 --
<CAPTION>
NAME UNEXERCISABLE
- --------------------------------------------- -----------------
<S> <C>
Peter van Voorst Vader....................... --
Rogerio Carlos Lamim Braz.................... --
Marcos Bastos Rocha.......................... --
</TABLE>
EMPLOYMENT AGREEMENTS
Mr. van Voorst Vader is party to an employment agreement with the Company,
which commenced on March 19, 1996 and is scheduled to expire in June 1999, which
calls for him to serve as the Company's Chief Executive Officer at a current
salary of $120,000 per annum, with provision for annual bonuses based upon
future results of operations, in such amounts, if any, as may be determined from
time to time at the discretion of the Board. At the time Mr. van Voorst Vader
entered into this employment agreement, he also received options to purchase an
aggregate of 150,000 shares of the Company's Common Stock, of which 50,000
shares will become available for purchase on March 19, 1997, 1998 and 1999,
respectively. The exercise price of Mr. Van Voorst Vader's options, which will
expire on the earlier of (i) March 19, 2001 or (ii) the termination of Mr. Van
Voorst Vader's employment with the Company, was $5 5/32 (the market price of the
Company's Common Stock on March 19, 1992.
Mr. Braz also entered into an employment agreement with the Company on March
19, 1996, which calls for him to serve as the Company's President and Chief
Operating Officer through June 1999 at a current salary of $198,000 per annum.
The agreement also provides that Mr. Braz may receive annual bonuses based upon
future results of operations, the amounts, if any, to be determined at the
discretion of the Board. In addition, Mr. Braz received options to purchase an
aggregate of 120,000 shares of the Company's Common Stock, of which 30,000
shares could be purchased immediately upon their grant. Mr. Braz may purchase an
additional 30,000 shares on each of March 19, 1997, 1998 and 1999, respectively.
The exercise price of all such options, which will expire on the earlier of (i)
March 19, 2001 or (ii) the termination of Mr. Braz' employment with the Company,
is $5 5/32 (the market price of the Company's Common Stock on March 19, 1996).
Mr. Rocha is a party to an employment agreement with the Company that
affords him current compensation of $134,500 per annum. This employment
agreement, which commenced on June 1, 1996 and is scheduled to expire in June
1999, contains a discretionary bonus provision substantially identical to those
contained in the respective employment agreements of Messrs. van Voorst Vader
and Braz. In addition, Mr. Rocha received a lump sum payment of $20,000 to
compensate him for the loss of a like amount bonus payment that he would have
received had he remained in the employ of Cyanamid, as well as options to
acquire an aggregate of 35,000 shares of the Company's Common Stock, of which
5,000 shares could be purchased immediately, with the balance becoming available
for purchase on a cumulative basis at the rate of 10,000 shares on June 1, 1997,
1998 and 1999, respectively. The exercise price of these options, which will
expire on the earlier of June 1, 2001 or the termination of Mr. Rocha's
employment, was $4 13/16 (the market price of the Company's Common Stock on June
1, 1996).
TERMINATION OF EMPLOYMENT AND CHANGE OF CONTROL ARRANGEMENTS
The employment arrangements between the Company and each of its three
executive officers provide that if the Company terminates the employment of any
of them, other than for cause, following a change of control, or any such person
voluntarily terminates such employment within 180 days subsequent to a change of
control, the Company shall be obligated to pay to such person an amount of money
equal to 2.9
5
<PAGE>
times his base amount (a term defined in the Internal Revenue Code of 1986, as
amended (the "Code"), which essentially is such person's annualized
compensation).
Further, all options, warrants and other rights to acquire securities of the
Company theretofore granted by the Company to any of such persons and
outstanding upon a change of control shall fully vest and become immediately
exercisable thereupon.
Change of control is defined under the aforementioned employment
arrangements as either (i) the acquisition by a person or group of persons
acting in concert of 20% or more beneficial ownership of the Company's Common
Stock or (ii) the commencement or announcement of an intention to make a tender
or exchange offer for 30% or more beneficial ownership of the Company's Common
Stock or (iii) the acquisition by a person or group of persons acting in concert
of 10% or more beneficial ownership of the Company's Common Stock, when such
persons' ownership interest is deemed by the Board to have a material adverse
impact on the business or prospects of the Company.
REPORT ON EXECUTIVE COMPENSATION
The Company does not have a compensation committee charged with reviewing
and recommending to the Board compensation programs for the Company's executive
officers. These functions are performed by the Board as a whole.
COMPENSATION PHILOSOPHY
The Company believes that executive compensation should:
- provide motivation to achieve goals by tying executive compensation to
Company performance, as well as affording recognition of individual
performance.
- provide compensation reasonably comparable to that offered by other
companies in a similar industry, and
- align the interests of executive offices with the long-term interests of
the Company's stockholders through the award of equity purchase
opportunities.
The Company's compensation plan is designed to encourage and balance the
attainment of short-term operational goals, as well as the implementation and
realization of long-term strategic initiatives. As greater responsibilities are
assumed by an executive officer, a larger portion of compensation is "at risk."
This philosophy is intended to apply to all management, including the
Company's Chief Executive Officer, Peter van Voorst Vader.
COMPENSATION PROGRAM
The Company's executive compensation program has two major components: base
salary and long-term equity incentives.
The Company seeks to position total compensation at or near the median
levels of other companies in a similar industry in Brazil.
Individual performance reviews are generally conducted annually. Increases
in fiscal year 1996 were based on an individual's sustained performance and the
achievement of the Company's revenue, income and earnings per share goals. The
Company does not assign specific weighting factors when measuring performance;
rather, subjective judgment and discretion is exercised in light of the
Company's overall compensation philosophy.
Base salary is determined by evaluating individual responsibility and
performance.
The Board believes that executive officers who are in a position to make a
substantial contribution to the long-term success of the Company and to build
stockholder value should have a significant equity stake
6
<PAGE>
in the Company's on-going success. Accordingly, one of the Company's principal
motivation methods has been the award of stock options. In addition to financial
benefits to executive officers, if the price of the Company's Common Stock
during the term of any such option increases beyond such option's exercise
price, the program also creates an incentive for executive officers to remain
with the Company since options generally vest and become exercisable over a
five-year period and the first increment is not exercisable until one year after
the date of grant.
CHIEF EXECUTIVE OFFICER COMPENSATION
Peter van Voorst Vader's compensation is determined substantially in
conformity with the compensation philosophy, discussed above, that is applicable
to all of the Company's executive officers. Performance is measured against
predefined financial, operational and strategic objectives.
In establishing Mr. van Voorst Vader's base salary, the Board took into
account both corporate and individual achievements.
Mr. van Voorst Vader's performance objectives included quantitative goals
related to increasing revenues and earnings per share. His goals also included
significant qualitative objectives such as evaluating acquisition opportunities.
In measuring Mr. van Voorst Vader's performance against these goals, the
Board took note of the fact that Venbo's system-wide sales for the nine months
ended December 31, 1996, if annualized, would reflect an approximately 11.5%
increase over 1995 levels. Note was also taken of the quarter to quarter
reduction in 1996 operating losses subsequent to March 19, 1996. In addition,
under Mr. van Voorst Vader's leadership, the Company acquired the Mr. Theo and
BigBurger chains in June 1996 and July 1996, respectively. These two
acquisitions have positioned the Company as the second largest hamburger fast
food restaurant chain in Brazil in terms of revenues.
TAX CONSIDERATIONS
Section 162(m) of the Code generally limits the deductibility of
compensation in excess of $1 million paid to the chief executive officer and the
four most highly compensated officers. Certain performance-based compensation is
excluded by Section 162(m)(4)(C) of the Code in determining whether the $1
million cap applies. Currently the total compensation, including salary, bonuses
and excludable stock options for any of the named executives does not exceed
this limit. If in the future this regulation becomes applicable to the Company,
the Board will not necessarily limit executive compensation to that which is
deductible, but will consider alternatives to preserving the deductibility of
compensation payments and benefits to the extent consistent with its overall
compensation objectives and philosophy.
SUMMARY
The Board will continue to review the Company's compensation programs to
assure such programs are consistent with the objective of increasing stockholder
value.
THE BOARD OF DIRECTORS
Omar Carneiro da Cunha, CHAIRMAN
Peter van Voorst Vader
Ian Barnett
Lawrence Burstein
Jose Ricardo Bosquet Bomeny
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
During the year ended December 31, 1996, the following officers participated
in discussions concerning executive officer compensation: Peter van Voorst
Vader, Rogerio Carlos Lamim Braz and Marcos
7
<PAGE>
Bastos Rocha. Each of the named persons did not participate in discussions
concerning his own compensation.
All options, warrants and other rights to acquire securities of the Company
held by the Company's directors shall fully vest and become immediately
exercisable following a change of control.
PERFORMANCE GRAPH
The following graph shows the cumlative total return to stockholders from
April 8, 1994 (the date of the Company's initial public offering of its equity
securities) through December 31, 1996 with the cumulative total return of the
Standard and Poor's 500 Stock Index and the Standard and Poor's Restaurants
Index during the same period. This presentation assumes that $100 was invested
on April 8, 1994, and that all dividends were reinvested.
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
CUMULATIVE TOTAL RETURN TO STOCKHOLDERS
<S> <C> <C> <C>
Brazil Fast Food Corp. S&P 500 S&P Restaurants
4/8/94 $100.00 $100.00 $100.00
12/30/94 100.71 104.93 99.46
6/30/95 114.12 124.96 129.96
12/29/95 118.38 144.31 149.18
6/28/96 114.71 158.87 152.92
12/31/96 82.35 177.42 147.40
</TABLE>
<TABLE>
<S> <C> <C> <C> <C> <C> <C>
Total Return Analysis
4/8/94 12/30/94 6/30/95 12/29/95 6/28/96 12/31/96
Brazil Fast Food Corp. $100.00 $100.71 $114.12 $118.38 $114.71 $ 82.35
S&P 500 $100.00 $104.93 $124.96 $144.31 $158.87 $177.42
S&P Restaurants $100.00 $ 99.46 $129.96 $149.18 $152.92 $147.40
</TABLE>
8
<PAGE>
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth information as of May 9, 1997, based on
information obtained from the persons named below, with respect to the
beneficial ownership of shares of the Company's Common Stock held by (i) each
person known by the Company to be the owner of more than 5% of its outstanding
shares of Common Stock, (ii) each director and (iii) all executive officers and
directors as a group:
<TABLE>
<CAPTION>
AMOUNT AND NATURE
NAME AND ADDRESS OF OF BENEFICIAL APPROXIMATE
BENEFICIAL OWNER OWNERSHIP(1) PERCENTAGE OF CLASS
- ---------------------------------------------------------------- ------------------ ---------------------
<S> <C> <C>
Shampi Investments A.E.C........................................ 1,046,422 9.7%
L.G. Smith Boulevard
Punto Brabo
Oranjestad, Aruba
Peter van Voorst Vader.......................................... 1,089,922(2) 10.1%
Prudente de Moraes
1033/703
Ipanema 22420-043
Rio de Janeiro, Brazil
Ian S. Barnett.................................................. 28,611 *
c/o Heptagon Securities Ltd.
Broughton House
6-8 Sackville Street
London W1X 1DD
United Kingdom
Lawrence Burstein............................................... 387,500(3)(4) 3.6%
245 Fifth Avenue
New York, NY 10016
Omar Carneiro da Cunha.......................................... 37,500 0.3%
c/o Bond Consultoria Empresarial S/C Ltda.
Praia do Flamengo
200-22o. Andar
CEP 22210-030
Rio de Janeiro, Brazil
BigBurger Ltda.................................................. 1,520,000 14.1%
Rua Lauro Muller
116/2005
Rio de Janeiro, Brazil
Jose Ricardo Bosquet Bomeny..................................... 1,537,500(5) *
c/o BigBurger Ltda.
Rua Lauro Muller
116/2005
Rio de Janeiro, Brazil
All executive officers and directors
as a group (7 persons)........................................ 3,140,033(6) 29.1%
</TABLE>
- ------------------------
* Less than 1%.
(1) As used herein, beneficial ownership means the sole or shared power to vote
or direct the voting of a security or the sole or shared power to invest or
dispose or direct the investment or disposition of a security. Except as
otherwise indicated, all persons named herein have (i) sole voting power and
investment power with respect to their shares of the Company's Common Stock,
except to the extent that authority is shared by spouses under applicable
law, and (ii) record and beneficial ownership with
9
<PAGE>
respect to their shares of the Company's Common Stock. With respect to each
stockholder, includes any shares issuable upon exercise of all warrants held
by such stockholder that are currently exercisable or will become
exercisable within 60 days of May 9, 1997.
(2) Includes 1,046,422 shares owned by Shampi Investments A.E.C. ("Shampi"), of
which Mr. van Voorst Vader is the sole shareholder.
(3) Includes 11,111 shares owned by Trinity Capital Corp. ("Trinity Capital"),
an investment banking firm of which Mr. Burstein is a principal. Mr.
Burstein shares voting and investment power over these shares.
(4) Includes 44,444 shares owned by members of Mr. Burstein's family. Mr.
Burstein disclaims any voting or investment power over these shares.
(5) Includes 1,520,000 shares owned by BigBurger Ltda., of which Mr. Bomeny is a
principal shareholder.
(6) Includes (i) 11,111 shares owned by Trinity Capital, (ii) 44,444 shares
owned by members of Mr. Burstein's family, (iii) 1,046,422 shares owned by
Shampi, and (iv) 1,520,000 shares owned by BigBurger Ltda.
VOTING AGREEMENT
Mr. Burstein, together with three former officers and/or directors of the
Company (collectively, the "Former Company Principals"), Shampi and Mr. Bomeny
are parties to a Voting Agreement (the "Voting Agreement") which provides that
each of the parties will use all reasonable efforts to cause management of the
Company to nominate as directors of the Company, respectively, two designees of
the Former Company Principals, three designees of Shampi and Mr. Bomeny.
The Voting Agreement, in general, does not restrict the transferability of
shares held by the parties thereto. However, any party to the Voting Agreement
desiring to transfer its shares to an "Affiliate" (as defined in the Voting
Agreement), must first obtain such Affiliate's written consent to be bound by
the terms of the Voting Agreement.
The Voting Agreement will expire on March 18, 2002.
COMPLIANCE WITH SECTION 16(A) OF SECURITIES EXCHANGE ACT
Section 16(a) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), requires the Company;s officers and directors, and persons who
own more than 10% of the Company's Common Stock, to file reports of ownership
and changes in ownership with the Securities and Exchange Commission ("SEC").
Officers, directors and greater than 10% stockholders are required by SEC rule
to furnish the Company with copies of all Section 16(a) forms they file.
Based solely on its review of the copies of such forms received by it, or
written representations from certain reporting persons that no such forms were
required for those persons, the Company believes that during the year ended
December 31, 1996, all filing requirements applicable to officers, directors and
greater than 10% beneficial owners were complied with except that each officer
and director (other than Mr. Bomeny) was not timely in filing his initial report
of beneficial ownership and one monthly report of one transaction, respectively.
STOCKHOLDER PROPOSALS
Stockholder proposals intended to be presented at the Company's 1998 Annual
Meeting of Stockholders pursuant to the provisions of Rule 14a-8, promulgated
under the Exchange Act, must be received by the Company's offices in Rio de
Janeiro, Brazil by January 30, 1998 for inclusion in the Company's proxy
statement and form of proxy relating to such meeting.
10
<PAGE>
PROXY
BRAZIL FAST FOOD CORP.
PRAIA DO FLAMENGO
200-22O. ANDAR
CEP 22210-030
RIO DE JANEIRO, BRAZIL
------------------------------
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
------------------------------
The undersigned hereby appoints Peter van Voorst Vader and Rogerio
Carlos Lamim Braz, or either of them, attorneys or attorney of the
undersigned, for and in the name(s) of the undersigned, with power of
substitution and revocation in each to vote any and all shares of Common
Stock of Brazil Fast Food Corp. (the "Company"), which the undersigned would
be entitled to vote as fully as the undersigned could if personally present
at the Annual Meeting of Stockholders of the Company to be held on June 6,
1997 at 10:00 A.M. at the Rio Atlantica Hotel (Buzios-Salon-Floor C), Av.
Atlantica, 2964, Copacabana, Rio de Janeiro, Brazil, and at any adjournment
or adjournments thereof, upon the following items of business more fully
described in the notice of and proxy statement for such Annual Meeting
(receipt of which is hereby acknowledged):
(CONTINUED ON OTHER SIDE)
<PAGE>
/X/ PLEASE MARK YOUR
VOTES AS IN THIS
EXAMPLE.
<TABLE>
<CAPTION>
FOR ALL NOMINEES WITHHOLD
(except as marked AUTHORITY
to the contrary) to vote for all nominees
<S> <C> <C>
1) To elect five / / / / NOMINEES: 2) To transact such other business
directors of Omar Carneiro da Cunha as may properly come before the
the Company for the ensuing year. Peter van Voorst Vader Meeting.
(INSTRUCTIONS: TO WITHHOLD AUTHORITY TO Ian S. Barnett
VOTE FOR ANY INDIVIDUAL NOMINEE WRITE THAT Lawrence Burstein Only stockholders of record at the
NOMINEE'S NAME IN THE SPACE PROVIDED Jose Ricardo Bosquet Bomeny close of business on May 9, 1997
ABOVE) are entitled to notice of and to vote
at the Meeting or any adjournment
thereof.
WHETHER OR NOT YOU PLAN TO ATTEND
- -------------------------------------- THE MEETING, PLEASE SIGN AND DATE
THE ENCLOSED PROXY, WHICH IS
SOLICITED BY THE BOARD OF DIRECTORS
OF THE COMPANY, AND PROMPTLY RETURN
IT IN THE PRE-ADDRESSED ENVELOPE
PROVIDED FOR THAT PURPOSE. ANY
STOCKHOLDER MAY REVOKE HIS PROXY AT
ANY TIME BEFORE THE MEETING BY GIVING
WRITTEN NOTICE TO SUCH EFFECT, BY
SUBMITTING A SUBSEQUENTLY DATED PROXY
OR BY ATTENDING THE MEETING AND VOTING
IN PERSON.
Signature: Date: Signature: Date
--------------------------------- -------------------- --------------------------------- -------
NOTE: (Signature should be the same as the name printed hereon. Executors, administrators, trustees, guardians, attorneys, and
officers of corporations should add their titles when signing.)
</TABLE>
