EXHIBIT 99.7
EXHIBIT 1.1(f)
MOLINOS SUPPLY AGREEMENT
THIS AGREEMENT is made as of ________, 2003 by and between MOLINOS DE
PUERTO RICO, INC., a Nebraska corporation ("Molinos") and TO-RICOS, INC., a
Nebraska corporation ("To-Ricos").
RECITALS:
(a) To-Ricos uses the Products (as defined below) in its feedmill
in Puerto Rico.
(b) Molinos and To-Ricos desire to establish a mutually-preferred
supplier/purchaser agreement and to facilitate a relationship
which enhances To-Ricos' purchase of, and the sale by Molinos
of, the Products.
(c) To-Ricos' interest is to purchase its requirements of Products
at competitive delivered prices, and Molinos' interest is for
Molinos to supply such quantities of Products to To-Ricos at
competitive delivered prices.
AGREEMENT:
In consideration of the foregoing recitals which are incorporated with
and are made a part of this Agreement, and in further consideration of the
mutual covenants and agreements hereinafter contained, the parties hereto agree
as follows:
1. GENERAL STATEMENT. To-Ricos hereby agrees that Molinos is a
preferred supplier of the Products and Molinos hereby agrees that To-Ricos is a
preferred purchaser of the Products.
2. PURCHASE AND SALE OF PRODUCTS. In order to facilitate this preferred
supplier/purchaser relationship, and subject to the terms and conditions set
forth herein, Molinos shall sell to To-Ricos, and To-Ricos shall purchase from
Molinos, To-Ricos' requirements of corn and soybean meal (collectively, the
"Products"), or in such other volumes as the parties may mutually agree upon
from time to time. At least three (3) days prior to the start of each period of
time mutually agreed to by the parties during the term of this Agreement,
Molinos will contact To-Ricos to obtain To-Ricos' good faith estimate of
anticipated purchases of Products for the next immediately succeeding mutually
agreed to production period ("Production Period"). Included in the information
to be provided by To-Ricos will be the type of Products, quantities,
specifications, estimated delivery requirements and other relevant information
for the upcoming Production Period and To-Ricos shall offer Molinos the right to
provide such Products to To-Ricos on the terms and conditions set forth herein.
Based on this information, Molinos will notify To-Ricos within three (3) days
thereafter (or such other period of time as to which the parties may mutually
agree) which Products it desires to supply. Within three (3) days (or such other
period as to which the parties may mutually agree) after sending such notice to
To-Ricos, Molinos will meet with To-Ricos to develop good faith estimated orders
for the Products for the upcoming Production Period. Each
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party agrees to give the other party, if possible, at least ninety (90) days
prior written notice of any significant demand change with respect to the
Products to be supplied and purchased hereunder of which either party may become
aware. To maintain this preferred supplier status, Molinos shall meet To-Ricos'
specifications (consistent with existing specifications and as may be reasonably
changed in the future), quantity delivery and service requirements. To maintain
this preferred purchaser status, To-Ricos shall comply with the agreed payment
terms. The scale at Molinos' elevator shall be used to establish quantities of
Products sold to To-Ricos hereunder. The scale at Molinos' elevator shall be
certified periodically by the applicable Puerto Rican governmental agency, but
not more than twice a year.
3. PRICING OF PRODUCTS. All Products supplied to To-Ricos hereunder
shall be sold at New Orleans grain market prices with market freight and
execution costs (e.g., New Orleans loading charges, port fees, fuel escalation,
etc.). All prices are FOB Molinos' elevator in Puerto Rico. Molinos will meet
periodically with To-Ricos to discuss and determine pricing and payment
mechanics and procedures.
4. TERM. The term of this Agreement shall be five (5) years commencing
on the date hereof.
5. SPECIAL CIRCUMSTANCES. The parties acknowledge that, from time to
time, To-Ricos may have unpredicted and/or special purchase needs for Products
that cannot be accommodated by the purchase and sale mechanism set forth in
Section 2 above, including To-Ricos' desire to effect forward purchases of
Products (i.e., the purchase of goods made pursuant to a contract in which the
buyer and seller agree to terms and conditions for future delivery of those
goods). With respect to such special circumstances, To-Ricos will use its good
faith efforts to work with Molinos so that Molinos will have the first
opportunity to supply such Products where practical, but in the event Molinos is
unable to supply such Products, or does not agree to effect To-Ricos' forward
purchases of Products, To-Ricos shall be free to purchase such Products
(including forward purchases of Products) from unrelated third-party suppliers.
With respect to any such Products that Molinos is initially unable to provide
To-Ricos (and for which To-Ricos has not entered enter into an agreement that
requires such Product to be supplied by a third party), To-Ricos shall offer
Molinos the opportunity to provide such Products pursuant to the next three (3)
month notice under Section 2 above if To-Ricos' requirements for such Products
continue.
6. REPRESENTATIONS AND WARRANTIES OF MOLINOS. Molinos warrants and
represents that:
(a) All of the Products shall comply with the specifications
therefor, and shall be merchantable, of good quality and fit
for the purpose intended.
(b) The execution of the Agreement and performance of its
obligations under this Agreement does not, and will not,
breach or conflict with any agreement, pledge, or contract to
which Molinos is a party or to which any of the assets of
Molinos are subject.
(c) Molinos shall have clear title to all Products sold to
To-Ricos hereunder, and To-Ricos shall receive clear and
unencumbered title to such Products.
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7. REPRESENTATIONS AND WARRANTIES OF TO-RICOS. The execution of the
Agreement and performance of its obligations under this Agreement does not, and
will not, breach or conflict with any agreement, pledge, or contract to which
To-Ricos is a party or to which any assets of To-Ricos are subject.
8. INDEMNIFICATION.
(a) Molinos shall indemnify and hold To-Ricos harmless from and
against any and all claims, demands, actions, causes of
action, proceedings, judgments and other liabilities,
obligations, losses, damages, costs and expenses (including
reasonable attorneys' fees and costs) of any nature which
arise out of Molinos' negligent acts or omissions or result
from a breach by Molinos of any representation, warranty,
covenant or agreement provided herein.
(b) To-Ricos shall indemnify and hold Molinos harmless from and
against any and all claims, demands, actions, causes of
action, proceedings, judgments and other liabilities,
obligations, losses, damages, costs and expenses (including
reasonable attorneys' fees and costs) which arise out of
To-Ricos' negligent acts or omissions or result from a breach
by To-Ricos of any representation, warranty, covenant or
agreement provided herein.
9. INSURANCE. During the term of this Agreement each party shall
maintain adequate public liability or other insurance with reputable insurance
companies as hereinafter set forth. Each party shall furnish the other party
with certificates of insurance properly executed by its insurers evidencing such
insurance, and requiring the insurers to give at least thirty (30) days notice
to the other party in the event of cancellation or material alteration of such
coverage. The minimum insurance coverage to be maintained shall be as follows:
(a) Commercial general liability insurance written on occurrence
form, providing blanket contractual liability coverage and
products liability (including coverage for terroristic acts,
if available and at a reasonable cost) against claims for
bodily injury, death and property damage, affording minimum
single limit protection of no less than U.S. Two Million
Dollars (US$2,000,000) per occurrence.
(b) Worker's compensation (or acceptable equivalent) insurance in
accordance with the statutory requirements (including any
self-insurance provisions, if applicable) of the states in
which the insured conducts its operations and employer's
liability insurance affording minimum single limit protection
of $1,000,000 in respect to personal injury or death resulting
from one occurrence.
(c) Automobile liability insurance with limits of coverage of no
less than $2,000,000 per occurrence.
(d) Excess liability insurance with limits of coverage of no less
than $3,000,000 per occurrence and must follow form on all
underlying policies.
10. CONFIDENTIALITY. Each party acknowledges that in connection with
this Agreement it may receive certain confidential information from the other
party ("Confidential Information").
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The receiving party shall not at any time disclose the Confidential Information
to any person, firm, partnership, corporation or other entity (other than
persons employed by the receiving party and having a need to access the
Confidential Information for purposes of performing this Agreement) for any
reason whatsoever, nor shall the receiving party use the Confidential
Information for its benefit or for the benefit of any person, firm, partnership
or affiliates during the term of this Agreement or for any purpose other than
this Agreement and for a period of two (2) years after the termination hereof
unless required by any governmental authority or in response to any valid legal
process. Confidential Information disclosure will be limited to that information
necessary to effectuate the purpose of this Agreement. Each party shall take all
actions necessary to ensure that its employees and representatives having access
to the Confidential Information are bound by the terms of this Agreement.
Confidential Information shall not include information which (i) was in the
receiving party's possession prior to disclosure, (ii) is hereafter
independently developed by the receiving party, (iii) lawfully comes into the
possession of the receiving party, or (iv) is now or subsequently becomes,
through no act or failure to act by the receiving party, part of the public
domain.
11. FORCE MAJEURE. Neither Molinos nor To-Ricos shall be liable for, or
deemed to be in default hereunder or subject to any remedies of the other party
as a result of, delays or performance failures due to power failures, fire, acts
of God, acts of civil or military authority, embargoes, epidemics, terrorism,
strikes, riots or similar causes beyond such party's reasonable control, and
without the fault or negligence of To-Ricos or Molinos. Should any force majeure
condition occur which prevents Molinos from performing its obligations pursuant
to this Agreement from the Molinos elevator, Molinos shall, at To-Ricos'
request, use commercially reasonable efforts to provide Products from another
elevator of Molinos or any affiliate of Molinos. If Molinos is unable to provide
Products from another Molinos elevator, then To-Ricos shall have the right
during the period of force majeure to either (i) purchase Products from any
third party, or (ii) to the extent Molinos may agree, direct Molinos to obtain
Products required hereunder by To-Ricos from any third party suppliers
reasonably acceptable to To-Ricos. Each party shall use reasonable best efforts
to minimize the impact of any force majeure condition it experiences on the
other party to this Agreement and to otherwise keep the other party timely
advised as to minimization and removal of such condition.
12. APPLICABLE LAW. This Agreement shall be governed by the laws of the
State of Delaware, excluding its choice of law rules.
13. NO ASSIGNMENT. Neither party may assign this Agreement or its
rights hereunder without prior written consent from the other party, which
consent shall not be unreasonably withheld. For purposes of this Agreement, an
assignment shall be deemed to occur upon a change in the controlling ownership
interest of the respective party, either directly or indirectly, whether by
merger, consolidation, stock transfer, or otherwise. In the event the proposed
assignee of this Agreement does not accept assignment of this Agreement or in
the event such consent is withheld with respect to the sale, merger or other
transfer of any party hereto or the assets thereof, then in either event the
assigning party shall have the right to terminate this Agreement; provided that
with respect to a proposed partial assignment, such termination shall only
relate to the plants, subject to such partial assignment. In the event either
party is interested in selling any plant or business which is involved in either
the purchase or sale under this Agreement, then the party desiring to sell such
plant or business shall notify the other party hereto of its interest in such
sale at the same time it notifies third parties of its interest in selling the
plant or business.
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14. NOTICES. All notices which are required or may be given pursuant to
the terms of this Agreement shall be in writing and shall be sufficient in all
respects if given in writing and delivered personally or via telefacsimile or
overnight courier, or mailed by registered, certified or express mail, postage
prepaid, as follows:
(a) If to Molinos: Molinos de Puerto Rico, Inc.
X.X. XXX 000000
XXX XXXX, XX 00000
ATTN: PRESIDENT
with a copy to: ConAgra Foods, Inc.
Xxx XxxXxxx Xxxxx
Xxxxx, XX 00000-0000
ATTN: Controller
(b) If to To-Ricos:
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ATTN:
or at such other address as any party hereto shall have designated by notice in
writing to the other parties hereto.
15. BINDING EFFECT. This Agreement shall be binding upon and inure to
the benefit of the parties hereto, their legal representatives, successors and
permitted assigns.
16. ENTIRE AGREEMENT; AMENDMENTS. This writing constitutes the entire
understanding between the parties and supersedes all previous agreements or
negotiations on the subject matter herein whether written or oral, and shall not
be modified or amended except by written agreement duly executed by the parties
hereto.
17. WAIVER. A waiver by either party of any breach or default of this
Agreement is not to be construed as a waiver of any subsequent breach or
default.
18. INDEPENDENT CONTRACTORS. The relationship between the parties shall
at all times be deemed that of independent contractors. This Agreement is not
intended to create between the parties a relationship of partners, principal and
agent, joint venturers or any other similar relationship.
19. NO CONSEQUENTIAL DAMAGES. IN NO EVENT SHALL A PARTY OR ITS
AFFILIATES OR THEIR RESPECTIVE OFFICERS, DIRECTORS, REPRESENTATIVES AND
EMPLOYEES BE LIABLE TO THE OTHER PARTY OR ITS
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AFFILIATES OR THEIR RESPECTIVE OFFICERS, DIRECTORS, REPRESENTATIVES AND
EMPLOYEES, WHETHER BASED IN CONTRACT, TORT, WARRANTY, OR ANY OTHER LEGAL OR
EQUITABLE GROUNDS, FOR ANY LOSS OF THE INCOME, PROFIT OR SAVINGS OR COST OF
CAPITAL OR FINANCING OF THE OTHER PARTY OR ITS AFFILIATES, FOR ANY INDIRECT,
INCIDENTAL OR CONSEQUENTIAL DAMAGES OR FOR ANY EXEMPLARY, SPECIAL, OR PUNITIVE
DAMAGES OF ANY KIND, RESULTING FROM OR RELATING TO THIS AGREEMENT OR THE
PRODUCTS DELIVERED HEREUNDER, EVEN IF THE OTHER PARTY HAS BEEN ADVISED OF THE
POSSIBILITY OF SUCH DAMAGES.
IN WITNESS WHEREOF the parties have executed this Agreement on the date
first written above.
MOLINOS DE PUERTO RICO, INC., TO-RICOS, INC.,
a Nebraska corporation a Nebraska corporation
By: By:
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Its: Its:
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