Exhibit 10.4
AMENDED AND RESTATED AGREEMENT FOR THE TRANSFER OF TITLE
TO SHARES BY WAY OF SECURITY
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THIS AMENDED AND RESTATED AGREEMENT FOR THE TRANSFER OF TITLE TO SHARES BY WAY
OF SECURITY (hereinafter referred to as the "Agreement") is entered into as of
October 21, 1999, by and between INTERNATIONAL FAST FOOD CORPORATION, a company
organized under the laws of Florida, USA, having its principal place of business
at 0000 Xxxxxxx Xxxx, Xxxxx 000, Xxxxx Xxxxx, Xxxxxxx 00000, XXX (hereinafter
referred to as "IFFC"), BURGER KING CORPORATION, a company organized under the
laws of Florida, USA, having its principal place of business at 00000 Xxx Xxxxxx
Xx, Xxxxx, Xxxxxxx, XXX (hereinafter referred to as "BKC"), and INTERNATIONAL
FAST FOOD POLSKA Sp. z o.o. , a Polish limited liability company organized under
the laws of Poland, having its registered office at 00 Xxxxxxxxxxxx Xxxxxx,
Xxxxxx, Xxxxxx, hereinafter referred to as "IFFP").
WHEREAS, the IFFC is the owner of one issued share having a nominal
value of PLN 54,866,089.57 at present constituting 100% of entire share capital
(hereinafter referred to as the "Shares"), of IFFP;
WHEREAS, on February 24, 0000, Xxxxxxxx (Xxxxxx) S.A. agreed to provide
credit to IFFP in the total amount of U.S. $5,000,000 (hereinafter referred to
as the "Facility") pursuant to the Framework Agreement and the Credit Agreement
dated February 24, 1999 (as amended, the "Credit Agreement");
WHEREAS, as a condition of the disbursement of funds under the
Facility, BKC issued a guarantee for the benefit of Citibank (Poland) S.A. of
the repayment of amounts borrowed under the Facility (as amended, the
"Guarantee");
WHEREAS, IFFC and IFFP executed a certain Reimbursement Agreement dated
February 24, 1999 (such agreement, as amended from time to time, is referred to
herein as the "Reimbursement Agreement"), agreeing to reimburse BKC for any
loss, cost or expense which BKC may or might incur by reason of its execution of
or performance under the Guarantee;
WHEREAS, IFFC transferred title to the Shares to BKC as security for
the performance of the obligations of IFFC and IFFP under the Reimbursement
Agreement pursuant to an Agreement for the Transfer of Title to Shares by way of
Security dated February 24, 1999 (the "Security Agreement");
WHEREAS, pursuant to a Purchase Agreement dated February 24, 1999 (as
amended, the "Purchase Agreement"), the parties agreed that, in the event BKC
acquires the Shares pursuant to the exercise of its rights under the Security
Agreement, BKC will sell the Shares held by BKC to Xxxxxxxx;
WHEREAS, Citibank has agreed to increase the amount which may be
borrowed under the Credit Agreement to an aggregate amount of U.S. $8,000,000,
and BKC has agreed to increase the amount of the Guarantee to secure the
repayment by IFFP of amounts borrowed under the Credit Agreement;
WHEREAS, in the event that Citibank is willing to further increase the
amount which may be borrowed under the Credit Agreement, BKC has agreed to
increase the amount of the Guarantee to a maximum aggregate amount of U.S.
$10,000,000, upon the terms, and subject to the conditions, of that certain
Guarantee of Future Advances Agreement dated of even date herewith by and among
BKC, IFFC and IFFP; and
WHEREAS, Xxxxxxxx has agreed to personally guarantee (i) his
obligations to BKC under the Purchase Agreement and (ii) IFFC's and IFFP's
obligations under the Reimbursement Agreement and to secure such personal
guarantee by the grant of a security interest in, and a pledge to BKC of, an
aggregate of 5,000,000 shares of common stock of IFFC which are owned by
Xxxxxxxx;
WHEREAS, IFFC, IFFP and BKC have agreed to amend and restate the
documents executed in connection with the transactions described above (such
documents are collectively referred to herein as the "Transaction Documents") to
reflect the increased amount of the Credit Agreement and the Guarantee and to
grant BKC additional security for the repayment of IFFC's and IFFP's obligations
under the Transaction Documents.
NOW, THEREFORE, in consideration of the foregoing, and for other good
and valuable consideration, the receipt and adequacy of which are hereby
acknowledged, the parties hereby agree as follows:
1. AMENDMENT AND RESTATEMENT
This Agreement amends, supersedes and restates the Security Agreement in its
entirety.
2. DEFINITIONS
"BUSINESS DAY" means a day (other than Saturday) when banks are open for
business in Miami Beach, Florida.
"COLLATERAL" means the Shares, together with all certificates, options or rights
of any nature that may be issued or granted by IFFP with respect thereto, any
property received or otherwise distributed in connection therewith, all
dividends and income with respect thereto, and all Proceeds thereof.
"EVENT OF DEFAULT" shall have the meaning set forth in Section 7 hereof.
"LIEN" means a mortgage, pledge, lien, security interest or other charge or
encumbrance or any segregation of assets or revenues or other preferential
arrangement (whether or not constituting a security interest) with respect to
any present or future assets, including fixtures, revenues or rights to the
receipt of income of the Person referred to in the context in which the term is
used.
"PERSON" means any natural person, corporation, unincorporated organization,
trust, joint-stock company, joint venture, association, company, partnership or
government, or any agency or political subdivision of any government.
"PLN" OR "POLISH ZLOTYS" means the lawful currency of the Republic of Poland.
"PROCEEDS" means all "proceeds" as such term is defined in Section 679.306 of
the Uniform Commercial Code in effect in the State of Florida on the date
hereof.
"SECURED LIABILITIES" means all liabilities of IFFC to BKC which may arise under
the Reimbursement Agreement.
All capitalized terms not otherwise defined herein shall have the meanings given
to such terms in the Reimbursement Agreement.
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2. SECURITY
As security for the prompt payment and complete performance when due (whether by
acceleration or otherwise) of the Secured Liabilities, IFFC hereby transfers to
BKC the ownership title to the Shares.
3. REPRESENTATIONS AND WARRANTIES OF IFFC
IFFC represents and warrants to BKC as follows:
(a) The execution and performance of this Agreement does not violate
any provisions of any existing indenture, contract or agreement
to which IFFC is a party.
(b) The Shares have been duly and validly issued and are fully paid
and non-assessable.
(c) IFFC is the sole legal and beneficial owner of, and has good and
marketable title to, the Shares, free and clear of any and all
Liens or options in favor of, or claims of, any other Person,
except the Lien created by this Agreement, and has the
unqualified right and power to grant the security interest in the
Collateral granted hereby without the consent of any other
Person.
(d) The Shares are all of the shares of IFFP owned by IFFC, and
constitute 100% of the issued and outstanding share capital of
IFFP.
(e) IFFC has delivered to BKC all documents evidencing the Shares,
together with all documents permitting transfer of title of the
Shares to BKC.
(f) The Lien granted pursuant to this Agreement constitutes a valid,
perfected first priority Lien on the Collateral, enforceable as
such against all creditors of IFFC and any Persons purporting to
purchase any Shares from IFFC.
(g) IFFC is not in default under any agreement, obligation or duty to
which it is a party, which default would threaten the ability of
IFFC to fulfill its obligations under this Agreement;
(h) Neither the signing of this Agreement nor the performance of any
of the transactions contemplated in it does or will controvert or
constitute a default under, or cause to be exceeded, any
limitation imposed on IFFC by or contained in:
(i) any law by which it or any of its assets is bound or
affected; or
(ii) any agreement to which it is a party or is bound,
(i) The execution and delivery of this Agreement has been duly
authorized by all required corporate action and IFFC has received
all required consents and approvals from IFFP and its
shareholders to transfer the Shares to BKC according to this
Agreement;
(k) Except as otherwise disclosed in IFFC's periodic reports filed
with the United States Securities and Exchange Commission under
the Securities and Exchange Act of 1934, as amended, no
litigation, arbitration or administrative proceedings claim in
which there is a serious possibility of an adverse decision which
could by itself or together with any other such proceedings or
claims either have a material adverse effect on the business,
assets or condition thereof, or materially and adversely affect
its ability to observe or perform its obligations under this
Agreement, is currently in progress or pending against IFFC;
(l) Except as disclosed in IFFC's periodic reports filed under the
Securities Exchange Act of 1934, as amended, IFFC is not in
default in the payment of any taxes, or other public dues and no
material claim is being asserted with respect to taxes or other
public dues.
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4. UNDERTAKINGS OF IFFC
IFFC convenants and agrees with BKC that until its obligations under the
Reimbursement Agreement have been satisfied:
(a) Without the prior written consent of BKC, the IFFC shall not (i)
vote to enable, or take any other action to permit, IFFP to issue
any stock or other equity securities of any nature or to issue
any other securities convertible into or granting the right to
purchase or exchange for any stock or other equity securities of
any nature; (ii) sell, assign, transfer, exchange, or otherwise
dispose of, or grant any option with respect to, the Collateral;
or (iii) create, incur or permit to exist any Lien or option in
favor of, or any claim of any Person with respect to, any of the
Collateral, or any interest therein, except for the Lien provided
for by this Agreement.
(b) At any time and from time to time, upon the written request of
BKC, and at the sole expense of the IFFC, IFFC will promptly and
duly execute and deliver such further instruments and documents
and take such further actions as BKC may reasonably request for
the purposes of obtaining or preserving the full benefits of this
Agreement and of the rights and powers herein granted.
(c) Without the prior written consent of BKC, IFFC shall not receive,
collect or have paid over any dividends or other distributions
declared or paid on the Shares, including, but not limited to,
(i) dividends or redistributions constituting dividends, (ii)
dividends or distributions in property other than cash or stock,
and (iii) liquidation dividends (either partial or complete), and
any and all such dividends and distributions shall constitute and
be additional security for the obligations hereby secured, shall
be held by the IFFC in trust for BKC without commingling such
dividends and distributions with any other funds of IFFC and
shall be paid over and/or pledged and deposited with BKC, duly
endorsed or accompanied by appropriate instruments of transfer
duly executed by IFFC, all in form and substance satisfactory to
BKC, and BKC shall have in respect thereof all of the other
powers and rights as are herein provided in respect of the Share.
(d) IFFC shall take, at its own expense, whatever action BKC may
require for establishing, maintaining, or enforcing the Security
over the Shares, and the giving of any notice, order or
direction, and the making of any registration, which BKC may
think expedient. Specifically, IFFC shall execute and file with
the Florida Secretary of State a UCC-1 financing statement, which
shall be in form and substance satisfactory to BKC and shall
execute and file with the Polish Antimonopoly Office a
notification of transfer of the Shares to BKC.
(e) IFFC shall not do or knowingly permit to be done any act or thing
which might reasonably be expected to jeopardize the right of BKC
as owner of the Shares.
5. UNDERTAKINGS OF IFFP
IFFP recognizes the transfer evidenced by this Agreement and undertakes, upon
the execution hereof, to enter BKC into IFFP's register of shares as beneficiary
of the security interest with respect to the Shares. IFFP further undertakes
that after BKC is entered into share register, it will deliver the share
register to BKC or its designated agent in Warsaw to hold in trust for the term
of this Agreement. IFFP further undertakes to maintain its existence, keep its
properties in good repair, maintain insurance as reasonably required by the
conduct of its business and defend BKC's security interests in the Collateral
against claims of third parties. IFFP shall provide BKC with proof of the
keeping of this undertaking from time to time, as reasonably requested by BKC.
6. UNDERTAKINGS OF BKC
BKC hereby undertakes to transfer and or release the ownership title to, or any
security interest in, the Shares and all other Collateral to IFFC immediately
after expiration of the Guarantee (including the termination or the Guarantee
upon the termination of the Facility), unless and to the extent that BKC shall
have any obligations under the Guarantee.
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7. EVENTS OF DEFAULT
As used herein, the term "Event of Default" shall include any or all of the
following:
(a) The filing or issuance of a notice of any lien, warrant or notice
of levy for taxes or assessment against the assets of IFFC or
IFFP (except as disclosed in IFFC's most recent Quarterly Report
on Form 10-Q and for those which relate to claims which are not,
individually or in the aggregate, material to IFFC or IFFC or
those which are being contested in good faith and for which
adequate reserves have been created); or
(b) The occurrence of a default under the Reimbursement Agreement; or
(c) The adjudication of IFFC or IFFP as bankrupt, or the taking of
any voluntary action by IFFC or IFFP or any involuntary action
against IFFC or IFFP seeking an adjudication of IFFC or IFFP as
bankrupt, or seeking relief by or against IFFC or IFFP under any
provision of the United States Bankruptcy Code or analogous code
of the Republic of Poland.
8. REMEDIES
Subject to the provisions of that certain Amended and Restated Purchase
Agreement of even date herewith (the "Purchase Agreement"), by and among IFFC,
Xxxxxxxx Xxxxxxxx, IFFP and BKC, upon the occurrence any Event of Default, BKC
may, without demand of performance or other demand, advertisement or notice
(except, the notice specified below with respect to sales) to or upon IFFC or
IFFP, all of which are expressly hereby waived, and in addition to other rights
it may have, or hereafter acquire, (i) immediately collect, receive,
appropriate, retain and, if it so chooses, realize upon, the Shares, or any part
thereof, have such Shares registered in the name of BKC or its nominee, and
thereafter exercise all voting and other rights with respect to the Shares; (ii)
sell, assign, give options to purchase, or otherwise dispose of, in one or more
parcels, the Shares, or (iii) exercise the rights of a secured creditor under
the Uniform Commercial Code of Florida or similar law in any applicable
jurisdiction. Without limiting the foregoing, subject to the provisions of the
Purchase Agreement, BKC shall have the right to retain the Collateral in
discharge of the indebtedness secured thereby. Any notice of sale, disposition,
or other intended action by BKC, mailed by ordinary mail to the address of IFFC
as shown on the records of BKC at least five (5) days before the action, shall
constitute reasonable notice. In case of any sale or other disposition of any of
the Collateral aforesaid, after deducting all costs and expenses of every kind
for care, safekeeping, collection, sale, delivery and for reasonable attorneys'
fees for legal services in connection therewith, BKC shall apply the residue of
the proceeds of the sale or sales or other disposition of the Collateral, in
full or partial payment of the obligations hereby secured, as it may deem
proper, and returning the surplus, if any, to IFFC.
9. REALIZATION
BKC may, if it deems it advisable to do so, restrict the prospective bidders or
purchasers to Persons who will represent and agree that they are purchasing for
their own account for investment and not with a view to the resale or
distribution of any of the Collateral and, in particular may restrict the
prospective bidders of purchasers to Persons which, in its judgment will have
the capacity to perform the commitments required by an owner of IFFP as the
holder of rights under any development or franchise agreement with BKC.
10. ASSIGNMENT
BKC may assign or transfer this Agreement, or any instrument evidencing the
obligations hereby secured, and may transfer and/or deliver any and/or all of
the Collateral, whether now owned or hereafter acquired, held as security
hereunder, or any part hereof, to any subsidiary or affiliate of BKC, which
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shall thereupon become vested with all the powers and rights and obligations in
respect thereto given to BKC in this Agreement or in the instruments so
transferred. BKC shall thereafter be forever relieved and fully discharged from
any liability or responsibility with respect to such Collateral, but BKC shall
retain all rights and powers hereby given with respect to any and all
instruments, rights or Collateral not so transferred. No delay on the part of
BKC shall operate as a waiver of such rights, nor shall the waiver of any breach
hereunder operate as a waiver of any subsequent breach. IFFC hereby agrees that
its obligations under this Agreement shall be absolute and unconditional,
irrespective of:
(i) any lack of validity or enforceability of the Reimbursement
Agreement, the Guarantee, or any other agreement or instrument
relating to any of the foregoing;
(ii) any change in the time, manner or place of payment of, or in
any other term of, all or any of the obligations secured
hereunder, or any other amendment or waiver of or any consent
to any departure from the Reimbursement Agreement, the
Guarantee, or any other agreement or instrument relating to
any of the foregoing, in each case so long as IFFC shall have
received written notice thereof; or
(iii) any exchange, release or non-perfection of any other
collateral securing the obligations secured hereby, or any
release or amendment or waiver of or consent to departure from
any guaranty, for all or any of such obligations.
11. POWER OF ATTORNEY TO BKC
IFFC hereby appoints BKC as IFFC's attorney-in-fact for the purpose of carrying
out the provisions of this Agreement and taking any action contemplated or
permitted hereby and executing any instrument that BKC may deem necessary or
advisable to accomplish the purposes hereof. Without limiting the generality of
the foregoing, if an Event of Default shall have occurred, BKC shall have the
right and power to receive, endorse and collect all checks and other orders for
the payment of money made payable to IFFC representing any dividend, payment or
other distribution payable in respect of the Shares or any part thereof and to
give full discharge for the same.
12. POWER OF ATTORNEY TO IFFC
Until the transfer of ownership title to the Shares under this Agreement is
effective, BKC hereby gives IFFC the Power of Attorney subject to the covenants
contained at Paragraph 4, above, to vote in the name and on behalf of BKC at
the ordinary and extraordinary Shareholders' Meetings of IFFP in all matters
which may be placed on the agenda of these meetings. BKC has the right to
revoke this Power of Attorney at any time during the term of this Agreement
upon the occurrence of an Event of Default. This power of attorney does not
give the right:
a) to receive notices of convening the Shareholders' Meeting (IFFP
should separately notify IFFC and BKC on the convening of any
Shareholders' Meeting); and
b) to vote at the Shareholders' Meeting held without formal
convening.
13. BKC's DUTIES WITH RESPECT TO COLLATERAL
Except as may result from BKC's gross negligence or willful misconduct, BKC
shall not be under any liability or obligation to take any steps whatsoever to
preserve the value of any Collateral pledged hereunder, to fix any liability
upon, or to collect or to enforce payment of the obligations hereby secured,
whether by giving any notice, presenting, demanding payment, protesting,
instituting suit or otherwise.
14. EXPENSES AND INDEMNITY
IFFC will indemnify BKC with respect to all liabilities and expenses incurred by
it in good faith in the execution or purported execution of any right, powers,
or discretion vested in it pursuant hereto. BKC shall not be liable for any
losses arising in connection with the exercise or purported execution of any of
its rights hereunder.
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15. NOTICES
Except as otherwise expressly provided herein, all notices, requests, demands or
other communications required or contemplated by the provisions hereof shall be
in writing, or by telex or facsimile transmission, and shall be deemed to have
been given or made on the third Business Day after the deposit thereof in the
United States mail, registered mail postage prepaid, or when received if sent by
telex or facsimile transmission or delivered by hand, addressed to the
appropriate party at its address set forth next to such party's signature
hereto, or at such other address as may be designated by such party by notice to
the other parties hereto given pursuant to this Section 15.
The addresses, and facsimile number of the for all notices under or in
connection with this Agreement are as follows:
As to BKC:
Burger King Corporation
P.O. Box 020783
00000 Xxx Xxxxxx Xx,
Xxxxx, Xxxxxxx 00000-0000,
XXX
telephone: __________________
facsimile: __________________
As to IFFC:
International Fast Food Corporation
0000 Xxxxxxx Xxxx, Xxxxx 000,
Xxxxx Xxxxx, Xxxxxxx 00000,
XXX
telephone: (000) 000 00 00
facsimile: (000) 000 00 00
As to IFFP:
International Fast Food Polska
00 Xxxxxxxxxxxx Xxxxxx,
00-000 Xxxxxx,
Xxxxxx
telephone: (00) 000 00 00
facsimile: (00) 000 00 00
or such other as such party may notify to the others by not less than 5 Business
Days' notice.
16. NON-EXCLUSIVITY OF REMEDIES
No remedy herein conferred upon or reserved to BKC is intended to be exclusive
of any other available remedy or remedies, but each and every such remedy shall
be cumulative and shall be in addition to every other remedy given under this
Agreement or now or hereafter existing at law or in equity. No delay or omission
to exercise any right or power accruing upon any default, omission or failure of
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performance hereunder shall impair any such right or power or shall be construed
to be a waiver thereof, but any such right and power may be exercised from time
to time and as often as may be deemed expedient. In order to entitle BKC to
exercise any remedy reserved to it in this Agreement, it shall not be necessary
to give any notice, other than such notice as may be herein expressly required.
In the event any provision contained in this Agreement should be breached by
IFFC and hereafter duly waived by BKC, such waiver shall be limited to the
particular breach so waived and shall not be deemed to waive any other breach
hereunder. No waiver, amendment, release or modification of this Agreement shall
be established by conduct, custom or course of dealing, but solely by an
instrument in writing duly executed by BKC.
17. ENTIRE AGREEMENT
This Agreement, together with the Reimbursement Agreement, the Purchase
Agreement and the Guarantee, constitute the entire agreement with respect to the
pledge of the Collateral, and supersedes all prior agreements and
understandings, both written and oral, between the parties with respect to the
subject matter hereof, and may be executed simultaneously in several
counterparts, each of which shall be deemed an original, and all of which
together shall constitute one and the same instrument.
18. SEVERABILITY
The invalidity or unenforceability of any one or more phrases, sentences,
clauses or sections in this Agreement shall not affect the validity or
enforceability of the remaining portions of this Agreement, or any part thereof.
This Agreement shall be governed and construed exclusively by the laws of the
State of Florida without reference to the conflict of laws rules thereof.
19. BINDING EFFECT
The terms and provisions of this Agreement shall be binding upon and shall inure
to the benefit of IFFC and BKC, and their respective successors, assigns, heirs,
devisees, and personal representatives. This Agreement may not be assigned by
either party hereto without the prior written consent of the other party hereto;
provided, that BKC may assign its rights and delegate its duties hereunder to
one of its subsidiaries or affiliates.
21. LANGUAGE
All notices or communications under or in connection with this Agreement shall
be in English. This Agreement shall be executed in English Language.
22. WAIVER OF TRIAL BY JURY
IFFC AND BKC, BY THEIR ACCEPTANCE OF THIS AGREEMENT, EACH HEREBY KNOWINGLY,
VOLUNTARILY AND INTENTIONALLY WAIVES THE RIGHT IT MAY HAVE TO A TRIAL BY JURY IN
RESPECT OF ANY LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER OR IN
CONNECTION WITH THIS AGREEMENT AND ANY AGREEMENT CONTEMPLATED TO BE EXECUTED IN
CONJUNCTION HEREWITH OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS
(WHETHER VERBAL OR WRITTEN) OR ACTIONS OF EITHER PARTY. THIS PROVISION IS A
MATERIAL INDUCEMENT FOR BKC ACCEPTING THIS AGREEMENT.
23. SETTLEMENT OF DISPUTES
Any claim arising out of this Agreement shall be brought in any state
or federal court located in Miami-Dade County, Florida, United States. For the
purpose of any suit, action or proceeding instituted with respect to any such
claim, each of the parties hereto irrevocably submits to the jurisdiction of
such courts in Miami-Dade County, Florida, United States. Each of the parties
hereto further irrevocably consents to the service of process out of said courts
by mailing a copy thereof by registered mail, postage prepaid, to such party and
agrees that such service, to the fullest extent permitted by law, (i) shall be
deemed in every respect effective service of process upon it in any such suit,
action or proceeding and (ii) shall be taken and held to be a valid personal
service upon and a personal delivery to it. Each of the parties hereto hereby
irrevocably waives, to the fullest extent permitted by law, any objection which
it may now or hereafter have to the laying of the venue of any such suit, action
or proceeding brought in any such court located in Miami-Dade County, Florida,
United States, and any claim that any such suit, action or proceeding brought in
such court has been brought in an inconvenient forum.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed as of the day first above written.
Burger King Corporation
By: /s/ Xxxxxx Xxxxxxxxx
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International Fast Food Corporation
By: /s/ Xxxxxxxx Xxxxxxxx - Chairman and CEO
-----------------------------------------
International Fast Food Polska Sp. z o.o.
By: /s/ Xxxxxxxx Xxxxxxxx - Authorized Signature
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