Exhibit 10.11
Certain portions of this exhibit have been deleted and confidentially filed
with the Securities and Exchange Commission pursuant to a confidential
treatment request under Rule 406 under the Securities Act of 1933, as amended.
The confidential portions of the exhibit that have been deleted are indicated
by "[*****]" inserted in place of such confidential information.
EXHIBIT 10.11
SUPPLY AGREEMENT
THIS SUPPLY AGREEMENT (herein the "Agreement"), is made on the date of
execution hereof by and between XXXXXX'X DISTRIBUTION, INC., a corporation
organized under the laws of the State of Iowa, (herein the "Purchaser") and
TYSON FOODS, INC., a corporation organized under the laws of the State of
Delaware (herein "Tyson").
WHEREAS, Xxxxxx'x, Inc., a corporation organized and existing under the laws
of the State of Iowa (herein "Xxxxxx'x"), is an indirect subsidiary of Tyson;
and
WHEREAS, the Purchaser has entered into an Asset Purchase Agreement with
Xxxxxx'x, whereby the Purchaser will purchase and Xxxxxx'x will sell certain
assets as set forth therein; and
WHEREAS, immediately after the Closing of the Asset Purchase Agreement, it
is anticipated that Tyson will cause the corporate name of Xxxxxx'x to be
changed to a new name acceptable to Tyson, not including the name "Xxxxxx'x,"
and that the Purchaser will change its corporate name to Xxxxxx'x, Inc.; and
WHEREAS, the execution and delivery of this Agreement is a condition
precedent to Closing under the Asset Purchase Agreement.
NOW, THEREFORE, in consideration of the mutual covenants contained herein
and for other good and valuable consideration, the receipt and sufficiency of
which is hereby acknowledged, the parties hereto agree as follows:
1. Sale and Purchase of Products. Subject to the terms and conditions of
-----------------------------
this Agreement, Tyson agrees to sell and the Purchaser agrees to purchase
certain Products within certain Product Categories as set forth in Paragraph 2
herein, in quantities as set forth in Paragraph 3 herein, in accordance with the
quality requirements set forth in Paragraph 4 herein, at prices as calculated in
Paragraph 5 herein.
2. Products. This Agreement shall include food Products within the
--------
Product Categories ("Product Categories") described in column one of Exhibit A,
attached hereto. Within the various Product Categories described in column one
of Exhibit A shall be food products ("Products") described in column two of
Exhibit A. New products may be added to this Agreement by mutual agreement, in
writing, signed by both parties.
3. Quantity.
--------
A. Output. The maximum amounts in pounds of each of the various
------
Product Categories included in column one of Exhibit A that Tyson shall
be required to sell to the Purchaser during the term of this Agreement
shall equal the amounts, in pounds, set forth in Exhibit B, Part One,
attached hereto.
B. Purchase. The minimum amounts in pounds of each of the various
--------
Product Categories included in column one of Exhibit A that the
Purchaser shall be required to purchase from Tyson during the term of
this Agreement shall equal the amounts, in pounds, set forth in Exhibit
B, Part Two, attached hereto.
4. Quality. Tyson shall sell to the Purchaser Products meeting
-------
"Specifications" in effect at the time of execution of this Agreement, in the
same "Product Mix" then in existence, except as otherwise provided in this
Agreement. Any substantial change in Product Mix or Specifications shall
require the written approval of both parties. "Product Mix" shall mean the
relative percentages of each Product Category, measured in pounds, identified in
Column three of Exhibit A, hereto, to the sum of the Products in all Product
Categories, measured in pounds, identified in Exhibit A. "Specifications" shall
mean all those matters set forth in the "Product Specification Book" identified
as Exhibit C, a copy of which is attached hereto.
5. Price.
-----
A. Calculation. Tyson shall sell each of the Products within the
-----------
Product Categories hereunder to the Purchaser at a price equal to the
lower of (i) the price mutually agreed upon by the Purchaser and Tyson
for the particular Product or (ii) the price calculated in the
following manner:
(a) Ground Beef Products. Prices per pound for Ground Beef
Products shall equal the sum of total raw cost per pound, as
hereinafter defined, in addition to Plus Factors per pound, as
hereinafter defined. Prices per pound for Ground Beef Products
shall be established on a formula basis utilizing the
[**************************************************************
*****************************************] to establish "total
raw cost". An example of the method to be utilized in the
calculation of "total raw cost" is attached hereto as Exhibit D.
The "Plus Factors" (as hereinafter defined) to be utilized in
establishing prices for Period One described in Exhibit B shall
be established as of August 1, 1990, and as of each succeeding
August 1 for each succeeding period thereafter, as described in
Exhibit B. "Plus Factors" for each packaging configuration shall
be established by [*********************************************
***************************************************************]
[*] confidentiality requested
-2-
[**************************************************************
*****************************************************************
*****************************************************************
*****************************************************************
************************************************************
*********************************************************
****************************]The weighted averages shall be
calculated as follows. First, the plus factors for each of the
-----
[************************************************************
*********************] (illustrated in Exhibit E, Column 1) as of
August 1, 1990, and August 1 of each succeeding applicable annual
period as described in Exhibit B, shall be multiplied by the
weight in pounds purchased by each such customer for each of the
Four Packaging Configurations for the preceeding twelve month
period, illustrated in Exhibit E, Column 2. The result,
illustrated in Exhibit E, Column 3, shall represent the total
incremental cost produced by each such customer's plus factor for
the total annual pounds of each of the Four Packaging
Configurations purchased in the preceding year. Second, the
------
total pounds of each of the Four Packaging Configurations
purchased in the preceeding annual period by each of [***********
****************************] shall be added to arrive at the
total pounds of ground beef in each of the Four Packaging
Configurations purchased by [*******************************
********] in the preceeding annual period, illustrated as the
"Total" in Exhibit E, Column 2. Third, the incremental cost
-----
related to the plus factors of each of [*******************
********************] for ground beef products for each of the
Four Packaging Configurations for the preceeding annual period
shall be added to produce the total incremental cost related to
the plus factors of [*****************************************]
for each of the Four Packaging Configurations for the preceeding
annual period, illustrated as the "Total" in Exhibit E, Column 3.
Finally, the total incremental cost of [*******************
-------
********************] related to their plus factors for each of
the Four Packaging Configurations (illustrated as "Total", in
Exhibit E, Column 3) shall be divided by the total pounds of
ground beef in each of the Four Packaging Configuration purchased
by [****************************************] in the preceeding
annual period (illustrated as "Total", in Exhibit E, Column 2) to
produce the weighted average of the plus factors of [***********
****************************] for the preceeding annual period
for each of the Four Packaging Configurations (illustrated in
Exhibit E, Column 4). An example of the formula to be utilized in
[*] confidentiality requested
-3-
the calculation of Plus Factors for each packaging configuration
is attached hereto as Exhibit E. The weighted averages so
calculated shall constitute the Plus Factors for the succeeding
annual period as described in Exhibit B. [**********************
****************************************************************
***************************************************************
**************************************************************
***************************************************************
***************************************************************
***************************************************************
*****************************************************************
*****************************************************************
****************************************************************
****************************************************************
***************************************************************
*****************************************************************
*****************************************************************
****************************************************************
*************************************************] Tyson shall
deliver all Ground Beef Products F.O.B. the Purchaser's receiving
dock in Le Mars, Iowa.
(b) Beef Steak Products. [*****************************
-------------------
************************************************************
****************************************************************
************************************************************
****************************************************************
************************************************************
**********************************************] Tyson shall
deliver all Beef Steak Products F.O.B. the Purchaser's receiving
dock in Le Mars, Iowa.
(c) Chicken Products. [****************************************
----------------
************************************************************
****************************************************************
************************************************************
****************************************************************
************************************************************
************************************************************
******************] Unless otherwise mutually agreed upon by the
parties, Chicken Products shall be sold by Tyson to the Purchaser
on a delivered basis with freight to the Purchaser's receiving
dock, Le Mars, Iowa, paid by Tyson. The risk of loss for all
[*] confidentiality requested
-4-
Chicken Products shall remain with Tyson until receipt of the
Product by the Purchaser at its receiving dock, Le Mars, Iowa.,
unless otherwise mutually agreed upon by the parties.
(d) Pork Products.
-------------
(1) [*****************************************************
******************************************************
*********************************************************
***************************************************
***********************************************************
********************************************************
**********************************************************
**********************************************************
******************************************************
*********************************************************
********************************] No later than August 1,
1992, the parties will attempt to agree upon new terms of
sale for the succeeding one year renewal of this Agreement.
Thereafter, if the parties have agreed upon terms for the
current period, the parties will attempt to agree upon new
terms for the succeeding one-year period. If no mutually
acceptable terms of sale can be agreed upon for any such
renewal period, the Purchaser may, in its sole discretion,
cancel its obligation to purchase Pork Products, including
chops, sausage, patties and links. In the event of such
cancellation, the obligation of Tyson to sell Pork Products
to the Purchaser under this Agreement shall terminate and
the Purchaser shall, for each ensuing one year period, meet
the Pork Product purchase requirements established in
Exhibit B, Part Two, by purchasing other Products identified
in Exhibit A, exclusive of Ground Beef Products.
(2) [****************************************************
**********************************************************
***********************************************************
**********************************************************
***********************************************************
************************************************************
******************]
[*] confidentiality requested
-5-
(3) Tyson shall deliver all Pork Products F.O.B. the
Purchaser's receiving dock in Le Mars, Iowa.
(4) Tyson shall give the Purchaser written notice of any
change in the location of its pork production facilities no
less than thirty (30) days prior to such change,.
(5) The Purchaser shall give Tyson written notice of any
cancellation of its obligation to purchase Pork Products
under this Agreement no later than August 1, 1992, or August
1 preceding each succeeding one-year renewal period, which
termination shall be effective the end of Period Two
described in Exhibit B or the end of the relevant succeeding
annual period, respectively.
(e) Breaded or Battered Vegetable Products. [*******************
--------------------------------------
****************************************************************
***************************************************************
****************************************************************
***************************************************************
****************************************************************
***************************************************************
****************************************************************
***************************************************************
***************************************************************
*********************************] No later than August 1, 1992,
the parties will attempt to agree upon new terms of sale for the
succeeding one year renewal of this Agreement. If the parties
have agreed upon terms for the current period, the parties will
attempt to agree upon new terms for the succeeding one-year
period. Tyson shall deliver all Breaded or Battered Vegetable
Products F.O.B. the Purchaser's receiving dock in Le Mars, Iowa.
(f) Cooked Roast Beef Products. [****************************
--------------------------
**************************************************************
***************************************************************
***************************************************************
**************************************************************
**************************************************************
***************************************************************
***************************************************************
**************************************************************]
[*] confidentiality requested
-6-
[****************************************************************
***************************************************************
*****************************************************************
****************************************************************
*****************************************************************
****************************************************************
***********************************] Tyson shall deliver all
Cooked Roast Beef Products F.O.B. the Purchaser's receiving dock
in Le Mars, Iowa.
(g) Breaded or Battered and Special Portion Products. [*********
------------------------------------------------
*****************************************************************
************************************************************
****************************************************************
*****************************************************************
***************************************************************
***************************************************************
**************] Tyson shall deliver all Breaded or Battered and
Special Portion Products F.O.B. the Purchaser's receiving dock in
Le Mars, Iowa.
B. The terms and conditions for spoils, returns, and sample credits will
be equal to the best terms and conditions offered to any of Tyson's food
service distributor customers for the particular Product or Product
Category.
C. Verification. [**********************************************
------------
************************************************************************
************************************************************************
*************************************************************************
***************************************************************************
************************************************************************
************************************************************************
*************************************************************************
***************************************************************************
************************************************************************
************************************************************************
*************************************************************************
**************************************************************************]
6. Orders. All orders shall be handled as follows:
------
(A) The Purchaser will advise Tyson of the levels of Products that the
Purchaser desires to maintain in the Purchaser's Le Mars, Iowa, freezer.
[*] confidentiality requested
-7-
The inventory levels will be based upon minimum and maximum poundage
amounts for each Product. The Purchaser shall not change the inventory
levels to be maintained more frequently than every thirty (30) days, except
for bids and special orders as provided in paragraph 6(C) of this
Agreement. Tyson shall comply with such changes within seven (7) days of
the Purchaser's notice. Tyson will have access to the Purchaser's sales
volumes in pounds and the Purchaser's Product inventory levels in pounds in
order to plan production schedules to comply with the minimum and maximum
levels for each Product.
(B) Tyson will submit to the Purchaser the content of each anticipated
shipment of Products to be sent to the Purchaser's Le Mars freezer. Each
such shipment will be assigned a purchase order number generated by the
Purchaser. All shipments of Products received from Tyson will have a xxxx
of lading, or a manifest, and a purchase order number generated by the
Purchaser.
(C) The minimum for a special order will be [******************************
*******]. Bids and special orders will require seven (7) days prior
notification from the Purchaser to Tyson.
7. Acceptance of Product. All Products shall be accepted by the Purchaser
---------------------
by endorsement of the manifest or xxxx of lading at the Purchaser's receiving
dock, Le Mars, Iowa.
8. Taxes. Each party shall be responsible for the satisfaction of any tax
-----
liability accruing to it under this Agreement. Upon the request of Tyson, the
Purchaser shall execute an Iowa sales tax resale exemption certificate.
9. Payment. Except as otherwise agreed in writing, payment by the
-------
Purchaser to Tyson for Products shall be made in cash, due within fourteen (14)
days after the date of the invoice for such Products. Payment by the Purchaser
shall not constitute waiver of any of the Purchaser's rights. In the event any
payment is not made when due under this Section 9, Tyson shall not be obligated
to sell or deliver Products hereunder until such payment is made.
10. Guarantee and Indemnification. Tyson shall give to the Purchaser a
-----------------------------
Continuing Guarantee and Indemnity Agreement in a form substantially similar to
Exhibit H, attached hereto, relating to all Products sold hereunder to the
Purchaser by Tyson or any of its directly or indirectly owned subsidiaries,
including Xxxxxx'x.
11. Term of Agreement. This Agreement shall become effective on the date
-----------------
of execution hereof, and shall continue in effect until its expiration on
October 3, 1992, unless terminated sooner as provided in Paragraph 12 below;
provided, however, that, the Purchaser shall thereafter have four successive
[*] confidentiality requested
-8-
options to extend the term of this Agreement for four additional one-year
periods. Each such option shall be exercisable, in writing, on or prior to the
following exercise dates:
First One-Year Period Last Exercise Date
--------------------- ------------------
October 4, 1992 to
October 2, 1993 August 1, 1992
Second One-Year Period Last Exercise Date
---------------------- ------------------
October 3, 1993 to
October 1, 1994 August 1, 1993
Third One-Year Period Last Exercise Date
--------------------- ------------------
October 2, 1994 to
September 30, 1995 August 1, 1994
Fourth One-Year Period Last Exercise Date
---------------------- ------------------
October 1, 1995 to
September 28, 1996 August 1, 1995
12. Termination. In addition to any other rights and remedies which the
-----------
Purchaser or Tyson may have under the laws of the State of Iowa or pursuant to
the terms of this Agreement (other than the resort to judicial remedies), the
Purchaser or Tyson shall have the right to terminate this Agreement under the
following circumstances and in the following manner:
A. Whether or not Tyson is in default under this Agreement, the Purchaser
may at any time and in its sole discretion terminate this Agreement by
giving Tyson written notice of its intent to so terminate. Such written
notice must be given at least six (6) months prior to termination. Upon
the expiration of such six (6) month notice period, this Agreement shall
terminate without further notice or action and the Purchaser's obligation
to purchase any additional amount of any Product or Product Category shall
cease.
B. In the event the Purchaser xxxxx Xxxxx to have failed to perform its
obligations under this Agreement ,with respect to the price, quality, or in
any other respect, the Purchaser may give Tyson written notice of such
default. Tyson shall have sixty (60) days from the date of receipt of the
notice to cure the default by refunding any amount charged to the Purchaser
in excess of the price calculated pursuant to Paragraph 5(A) of this
-9-
Agreement, with interest on such amount at the statutory rate, by remedying
any defect in product quality, or by remedying any other breach in the
appropriate manner. If Tyson fails to cure such default within sixty (60)
days, the Purchaser may, in its sole discretion either:
(i) elect to waive any default, in which event this Agreement shall
remain in full force and affect, and submit all disagreements between
the Purchaser and Tyson to binding arbitration pursuant to Chapter
679(A), Code of Iowa, 1989, under the rules and procedures of the
------------
American Arbitration Association, or
(ii) terminate this Agreement at the end of the sixty (60) day cure
period and submit all disagreements between the Purchaser and Tyson to
binding arbitration pursuant to Chapter 679(A), Code of Iowa, 1989,
------------
under the rules and procedures of the American Arbitration
Association. In the event of such termination, the Purchaser's
obligation to purchase any additional amount of any Product or Product
Category shall cease without regard to any requirement set forth in
this Agreement after the expiration of the sixty (60) day cure period.
C. In the event that Xxxxx xxxxx the Purchaser to have failed to perform
its obligations under this Agreement Tyson may give the Purchaser written
notice of such default. The Purchaser shall have sixty (60) days from the
date of receipt of the notice to cure the default. If the Purchaser fails
to cure such default within sixty (60) days, Tyson may, in its sole
discretion either:
(i) elect to waive any default, in which event this Agreement shall
remain in full force and effect, and submit all disagreements between
Tyson and the Purchaser to binding arbitration pursuant to Chapter
679(A), Code of Iowa, 1989, under the rules and procedures of the
------------
American Arbitration Association, or
(ii) terminate this Agreement at the end of the sixty (60) day cure
period and submit all disagreements between Tyson and the Purchaser to
binding arbitration pursuant to Chapter 679(A), Code of Iowa, 1989,
------------
under the rules and procedures of the American Arbitration
Association. In the event of such termination, Tyson's obligation to
sell any additional amount of any Product or Product Category shall
cease without regard to any requirement set forth in this Agreement
after the expiration of the sixty (60) day cure period.
-10-
13. Confidential Information.
------------------------
A. Confidentiality. Each party hereto agrees that, except as otherwise
---------------
provided herein, any Confidential Information disclosed to it in
connection with the performance of the terms of this Agreement shall
be retained in confidence in a manner adequate to protect the
disclosing party's trade secrets or other rights therein.
B. Description of Confidential Information. The term "Confidential
---------------------------------------
Information" as used herein shall mean any and all proprietary
information disclosed by one party to the other in connection with the
performance of the terms of this Agreement, whether disclosed in
writing, orally, visually or by samples; provided, however, that
"Confidential Information" shall not include any information that (i)
was publicly available at the time of disclosure by the disclosing
party, (ii) became publicly available after disclosure by the
disclosing party through no fault of the recipient, or (iii) was in
the recipient's possession prior to disclosure by the disclosing
party.
C. Exception. Nothing contained herein shall restrict the parties
---------
hereto from making Confidential Information available to employees or
agents in connection- with the discharge of the respective duties
imposed by this Agreement.
D. Period of Retention. The obligations imposed by this Paragraph 13
-------------------
shall remain in effect for one (1) year from the date of expiration or
termination of this Agreement, including any one-year extensions
thereof.
E. Nonessential Information. The Purchaser and Tyson both hereby
------------------------
represent and warrant that each of them have, prior to the execution
of this Agreement, delivered to the other all Confidential Information
in the possession of each or its officers, directors, employees, or
agents that is not essential to the performance of its obligations
hereunder. Such information includes, without limitation, all
information, whether written or electronically stored, not available
to food service distributor customers of Tyson or food service
distributor competitors of the Purchaser in the ordinary course of
business.
14. Backhauls. Tyson shall give the Purchaser an option on backhauls to
---------
the Le Mars, Orange City and Sioux Center, Iowa, area, provided that mutually
agreeable price terms and schedules can be reached by the parties.
15. Assignment. Tyson's rights or obligations under this Agreement shall
----------
not be assigned to any other person or entity without the prior written consent
of the Purchaser, which consent shall not be unreasonably withheld. The
Purchaser's rights or obligations under this Agreement shall not be assigned to
-11-
any other person or entity without the prior written consent of Tyson, which
consent shall not be unreasonably withheld. Nothing in this Paragraph 15 shall
be deemed to prohibit the pledge by the Purchaser, or the grant by the Purchaser
of a security interest in the Purchaser's right, title and interest in this
Agreement, if such pledge or security interest is required at any time by any of
the Purchaser's lenders.
16. Notices. All notices to be given by either party to this Agreement to
-------
the other party hereto shall be in writing, and shall be given in person, by
facsimile or-telecopy, or by depositing such notice in the United States mail by
registered or certified mail, return receipt requested, postage prepaid,
addressed as follows:
A. If to the Purchaser:
Harkers Distribution, Inc.
Xxxxxx X. Xxxxxx, President
X.X. Xxx 0000
000 Xxxxxx Xxxxxx X.X.
Xx Xxxx, XX 00000
With copies to:
Xxxxxx X. Schneebeek
Brown, Winick, Graves, Donnelly,
Xxxxxxxxxxx and Schoenebaum
Suite 1100, Two Ruan Center
000 Xxxxxx Xxxxxx
Xxx Xxxxxx, Xxxx 00000
B. If to Tyson:
Tyson Foods, Inc.
X.X. Xxx 0000
0000 Xxxx Xxxxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxx 00000
Attention: Xxxxx X. Xxx Xxxxxx, Esq.
-12-
With copies to:
Xxxxxx X. Xxxxxx
Xxxxx Xxxxxxx XxXxxx
Gamble, Riepe, Webster, Davis & Green
0000 Xxxx Xxxxxx
Xxx Xxxxxx, Xxxx 00000
Notices shall be deemed given on the date personally delivered or sent by
facsimile or telecopy or on the date deposited in the United States mail. Any
party to whom notices are to be given pursuant to this Agreement may from time
to time change its address for further communications hereunder by giving notice
in the manner prescribed herein to all other parties hereto.
17. Construction. Words and phrases herein shall be construed as in the
------------
singular or plural number, and as masculine, feminine, or neuter gander
according to the context. Capitalized terms shall have the meanings assigned
herein or in the Asset Purchase Agreement heretofore entered into between
Purchaser and Xxxxxx'x, as the context may require. All terms not otherwise
defined shall have the meaning assigned to them under the laws of the state of
Iowa. If any provision of this Agreement shall for any reason be held invalid
or unenforceable, such invalidity or unenforceability shall not affect any other
provision hereof, but this Agreement shall be construed as if such invalid or
unenforceable provision had never been contained herein. In addition, the
following rules shall apply in construing the meaning of this Agreement:
X. Xxxxx. To the extent required to satisfy the obligations and obtain
-----
the benefits of this Agreement, Tyson will cause its direct and indirect
subsidiaries, including Xxxxxx'x, to comply with the terms and conditions
hereof.
B. Governing Law. The Agreement shall be governed by and construed in
-------------
accordance with the laws of the State of Iowa.
C. Paragraph Headings. The paragraph headings contained in or affixed to
------------------
this Agreement are for convenience only and shall in no manner limit any of
the provisions of this Agreement.
D. Waiver. No waiver of any term, provision or condition of this
------
Agreement in any one or more instances shall be deemed to be or be
construed as a further or continuing waiver of any such term, provision or
condition or as a waiver of any other term, provision or condition of this
Agreement. Further, the exercise of any remedy under this Agreement by
either party shall not be deemed a waiver of any other remedy available at
law, in equity, or under this Agreement.
-13-
E. Entire Agreement. This Agreement supersedes all Agreements, either
----------------
oral or written, concerning the subject matter hereof, existing prior to
this date between the parties hereto. This Agreement may not be altered,
modified or amended unless agreed to by the parties hereto in writing and
signed by their duly authorized representatives.
IN WITNESS WHEREOF, the parties have executed this Agreement on the 9th day of
November, 1990.
TYSON FOODS, INC. XXXXXX'X DISTRIBUTION, INC.
By /s/ Xxxxx X. XxxXxxxxx By /s/ Xxxxxx X. Xxxxxx
---------------------------- ----------------------------
Its Asst. Secretary Its President
----------------------- -----------------------
Tyson The Purchaser
-14-
EXHIBIT A - PRODUCTS AND PRODUCT MIX
Page 2
PORK PRODUCTS PORK CHOPS [*******]
SAUSAGE LINKS AND PATTIES
CHICKEN PRODUCTS SPEC PRDTS PRE-FRIED [*******]
SPEC PRDTS PRE-COOKED
SPEC PRDTS BREADED ITEMS
BONE-IN OR BONELESS CHICKEN
OTHER RELATED CHICKEN PRODUCTS
OTHER PRODUCTS PRE-COOKED ROASTS [********]
SPEC PRDTS BEEF/VEAL UNBRD ----------
SPEC PRDTS BREADED ITEMS
SPEC PRDTS CONVENIENCE
SPEC PRDTS PORK ITEMS
SPEC PRDTS PRE-FRIED
SPEC PRDTS PRE-COOKED
TOTAL POUNDS [********]
----------
[*] confidentiality requested
-15-
EXHIBIT B
PART ONE - OUTPUT REQUIREMENTS (IN POUNDS):
PERIOD ONE PERIOD TWO PERIOD THREE PERIOD FOUR PERIOD FIVE PERIOD SIX
Sept. 30, 1990 Sept. 29, 1991 Oct. 4, 1992 to Oct. 3 1993 to Oct. 2, 1994 Oct. 1, 1995
to Sept. 28, to Oct. 3, 1992 Oct. 2, 1993 Oct. 1, 1994 to Sept. 30, to Sept. 28,
1991 1995 1996
PRODUCT CATEGORY
GROUND BEEF PRODUCTS [********] [********] [********] [********] [********] [********]
BEEF STEAK PRODUCTS [*******] [*******] [*******] [*******] [*******] [*******]
PORK PRODUCTS [*******] [*******] [*******] [*******] [*******] [*******]
CHICKEN PRODUCTS [********] [********] [********] [********] [********] [********]
OTHER PRODUCTS [********] [********] [********] [********] [********] [********]
PART TWO - PURCHASE REQUIREMENTS (IN POUNDS):
PERIOD ONE PERIOD TWO PERIOD THREE PERIOD FOUR PERIOD FIVE PERIOD SIX
Sept. 30, 1990 Sept. 29, 1991 Oct. 4, 1992 to Oct. 3, 1993 Oct. 2, 1994 Oct. 1, 1995
to Sept. 28, to Oct. 3, 1992 Oct. 2, 1993 to Oct. 1, 1994 to Sept. 30, to Sept. 28,
1991 1995 1996
PRODUCT CATEGORY
GROUND BEEF PRODUCTS [********] [********] [********] [********] [********] [********]
BEEF STEAK PRODUCTS [*******] [*******] [*******] [*******] [*******] [*******]
PORK PRODUCTS [*******] [*******] [*******] [*******] [*******] [*******]
CHICKEN PRODUCTS [*******] [*******] [*******] [*******] [*******] [*******]
OTHER PRODUCTS [********] [********] [********] [********] [********] [********]
[*] confidentiality requested
-16-
[SALES SPECIFICATIONS CHART]
[Best copy available - illegible]
-17-
CUSTOMER XXXXXX'X
ITEM NO.S 1814 1020
FORMULA NO. 3000 PURE GRD BEEF BULK -- 80/20
PACK 4/10 LB TUBES
QTY PRICE
A700 FROZ BEEF 90'S [*****] * [******] * [*****]
A701 FRSH BEEF 90'S [*****] * [******] * [*****]
A708 FRSH BEEF 50's [*****] * [*****] * [*****]
------
TOTAL = [******]
RAW / YIELD FACTOR [*****] MEAT COST = [******]
------
TOTAL RAW COST = [******]
PLUS FACTOR = [*****]
------
TOTAL = [******]
PRICE = [****]
XXXXXX'X INC.
USDA MARKET QUOTE USDA MARKET QUOTE USDA MARKET QUOTE
DATE FROZ BEEF 90'S FRSH BEEF 90'S FRSH BEEF 50'S
7/31/90 [******] [******] [*****]
7/30/90 [******] [******] [*****]
7/27/90 [******] [******] [*****]
7/26/90 [******] [******] [*****]
7/25/90 [******] [******] [*****]
AVERAGES [******] [******] [*****]
EXHIBIT D
-18-
[*] confidentiality requested
COLUMN 1 COLUMN 2 COLUMN 3 COLUMN 4
----------- ----------- ------------ ----------
PLUS POUNDS INCREMENTAL PLUS
FACTOR PURCHASED COST FACTOR
@ 08/01/YY 08/01/YY RELATED TO WEIGHTED
($s) TO 07/31/YY PLUS AVERAGE
FACTORS ($s) ($s)
TYSON'S FIVE LARGEST FOOD SERVICE DISTRIBUTION
CUSTOMERS FOR ALL GROUND BEEF PRODUCTS
CUSTOMER 1 [*********]
CUSTOMER 2 [*********]
CUSTOMER 3 [*********]
CUSTOMER 4 [*********]
CUSTOMER 5 [*********]
TOTAL [**********]
FIVE POUND BULK
CUSTOMER 1 [****] [*******] [******]
CUSTOMER 2 [*****] [*******] [******]
CUSTOMER 3 [*****] [*******] [******]
CUSTOMER 4 [****] [*********] [*******]
CUSTOMER 5 [*****] [*********] [*******]
---------- -------
TOTAL [*********] [*******] [*****]
TEN POUND BULK
CUSTOMER 1 [****] [*******] [******]
CUSTOMER 2 [*****] [*******] [******]
CUSTOMER 3 [*****] [*******] [******]
CUSTOMER 4 [****] [*********] [*******]
CUSTOMER 5 [*****] [*********] [*******]
---------- -------
TOTAL [*********] [*******] [*****]
TEN POUND PATTIES
CUSTOMER 1 [****] [*******] [******]
CUSTOMER 2 [*****] [*******] [******]
CUSTOMER 3 [*****] [*******] [******]
CUSTOMER 4 [****] [*******] [*******]
CUSTOMER 4 [*****] [*******] [******]
CUSTOMER 5 [*****] [*******] [******]
CUSTOMER 5 [******] [*********] [*******]
---------- -------
TOTAL [*********] [*******][********]
TWENTY POUND OR GREATER PATTIES
CUSTOMER 1 [*****] [*******] [******]
CUSTOMER 2 [******] [*******] [******]
CUSTOMER 3 [***** [*******] [******]
CUSTOMER 3 [******] [*******] [******]
CUSTOMER 4 [******] [*********] [*******]
CUSTOMER 5 [*****] [*******] [******]
CUSTOMER 5 [******] [*********] [*******]
---------- -------
TOTAL [*********] [*******][********]
* These calculations are for illustration purposes only. The actual figures
will be derived from Tyson's regularly maintained books and records per this
Agreement.
[*] confidentiality requested
-19-
XXXXXX'X, INC.
FORMULA PRICING EFFECTIVE 8/06/90
CUSTOMER XXXXXX'X
ITEM NOS. 1502 1521 1523 1531 1536 1541 1551 1561 1571
1581 1601
FORMULA NO. 3090 PURE BEEF PATTIES - 74/26
PACK 20 LB BOX
QUANTITY PRICE
A700 FROZEN BEEF 90'S [*****] x [******] = [*****]
A701 FRESH BEEF 90'S [*****] x [******] = [*****]
A708 FRESH BEEF 50'S [*****] x [*****] = [*****]
A713 FROZEN BEEF 50'S [*****] x [*****] = [*****]
------
TOTAL [******]
RAW/YIELD FACTOR .9858 MEAT COST = [******]
A718 LEAST COST FORMULA
REDUCTION [******] x [******] = [******]
------
TOTAL = [******]
RAW COST
PLUS = [*****]
FACTOR ------
TOTAL = [******]
PRICE = [****]
USDA MARKET QUOTE USDA MARKET QUOTE USDA MARKET QUOTE USDA MARKET QUOTE
DATE FROZEN BEEF 90'S FRESH BEEF 90'S FRESH BEEF 50'S FROZEN BEEF 50'S
7/31/90 [******] [******] [*****] [*****]
7/30/90 [******] [******] [*****] [*****]
7/27/90 [******] [******] [*****] [*****]
7/26/90 [******] [******] [*****] [*****]
7/25/90 [******] [******] [*****] [*****]
AVERAGES [******] [******] [*****] [*****]
EXHIBIT F
[*] confidentiality requested
-20-
EXHIBIT G
CERTIFICATE OF
TYSON FOODS, INC.
I, , an officer or employee of Tyson
----------------------------------
Foods, Inc., do hereby certify as follows:
1. I am duly authorized to execute and deliver this Certificate on behalf
of Tyson Foods, Inc.
2. I have examined the prices charged by Tyson Foods, Inc., to Xxxxxx'x
Distribution, Inc., under the Supply Agreement dated September 15, 1990, and the
prices charged by Tyson Foods, Inc., to its other food service distributor
customers. Both examinations involved the period of time from the date of the
last Certificate provided to Xxxxxx'x Distribution, Inc., by Tyson Foods, Inc.,
pursuant to said Supply Agreement to the date of this Certificate.
3. [***********************************************************************
********************************************************************************
******************************************************************************
*****************************************************************************
******************************************************************************
****************************************************************************
**********]
IN WITNESS WHEREOF, I have executed this Certificate on behalf of Tyson
Foods, Inc., as of the day of , 199 .
------ ------------------ --
----------------------------------------
[*] confidentiality requested
-21-
Exhibit H
CONTINUING GUARANTY
AND INDEMNITY AGREEMENT
TO:
The articles and products comprising each shipment or other delivery hereby
made by the undersigned to or on the order of
----------------------------------
or any of its affiliated companies are, when sold, shipped and/or delivered by
the undersigned, guaranteed:
1. Not adulterated or misbranded within the meaning of the Federal Food,
Drug and Cosmetic Act and all Regulations issued thereunder to the extent
said Act and Regulations are then effective and applicable.
2. In compliance with and are not adulterated or misbranded within the
requirements of the Poultry Products Inspection Act, Meat Inspection Act,
the Food Additives Amendment to the Federal Food, Drug and Cosmetic Act, and
all Regulations issued thereunder, and any other Federal law then effective
and applicable.
3. In compliance with and not adulterated or misbranded within the meaning
of any identical or substantially similar state or municipal law, on the
subject, to the extent said law is then effective and applicable.
Provided, however, that the undersigned does not guarantee against such
goods becoming adulterated or misbranded within the meaning of the aforesaid
Acts, Statutes, Ordinances, or Rules and Regulations after shipment by reason of
causes beyond Seller's control.
-2-
The undersigned further agrees to indemnify and save the aforesaid
or any of its affiliates and customers
---------------------------------
harmless against any expense which they may incur, damage which they may suffer,
loss they may sustain or judgment which may be entered, by reason of a breach of
the above guaranty or warranties and, further, by reason of any negligence on
the part of the undersigned which causes or contributes to cause any such
expense, damage, loss or judgment.
The undersigned further agrees at its expense to answer and defend any
action, claim, suit, demand and proceeding instituted against the above company
or companies for any loss, damage, and injuries sustained or claimed to have
been sustained by any individual, firm, corporation or other person, directly or
indirectly, arising out of or in connection with the consumption or use of any
article of food, drug, cosmetic and device from any sale, shipment and/or
delivery by the undersigned, its subsidiaries, affiliates and divisions.
This Guaranty and Indemnity Agreement shall be continuing until revoked by
giving ten days written notice by guarantor to said guarantees.
DATED this day of , 19 .
----- -------------------- ---
TYSON FOODS, INC.
Its Subsidiaries and Divisions
By:
---------------------------------------------
Xxxxxx Xxxxxx, Group
Vice President, Domestic
Sales and Marketing
-3-
EXHIBIT A
MODIFICATION TO SUPPLY AGREEMENT
THIS MODIFICATION TO SUPPLY AGREEMENT (the "Modification") is entered into
as of the 14th day of September, 1993 by and between Xxxxxx'x Distribution,
Inc., an Iowa corporation ("Purchaser"), and Tyson Foods, Inc., a Delaware
corporation ("Tyson").
W I T N E S S E T H :
-------------------
WHEREAS, Purchaser and Tyson entered into that certain Supply Agreement
dated November 9, 1990 (the "Supply Agreement"); and
WHEREAS, the parties hereto and thereto desire to amend and modify the
Supply Agreement in the manner hereinafter set forth;
NOW, THEREFORE, in consideration of the mutual covenants and agreements
herein contained, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereby agree as
follows:
1. The terms used in this Modification, to the extent not otherwise
defined, shall have the same meanings as in the Supply Agreement, as amended
hereby.
2. Part Two of Exhibit B to the Supply Agreement is hereby amended by
changing the Product Category amounts in Periods Four, Five and Six therein as
follows:
PRODUCT
CATEGORY PERIOD FOUR PERIOD FIVE PERIOD SIX
-------- ----------- ----------- ----------
GROUND BEEF PRODUCTS [**********] [**********] [**********]
BEEF STEAK PRODUCTS [*********] [*********] [*********]
PORK PRODUCTS [*******] [*******] [*******]
CHICKEN PRODUCTS [*********] [*********] [*********]
OTHER PRODUCTS [*********] [*********] [*********]
provided, however, that notwithstanding the minimum purchase amounts for each
-----------------
Product Category set forth above, Purchaser agrees to purchase the total amount
of products, regardless of category, set forth below:
[*] confidentiality requested
PERIOD FOUR PERIOD FIVE PERIOD SIX
----------- ----------- ----------
[********] [********] [********]
3. Except as amended hereby, the Supply Agreement shall continue in full
force and effect.
IN WITNESS WHEREOF, each party has executed this Modification or a
counterpart hereof on the date first above written.
XXXXXX'X DISTRIBUTION, INC. TYSON FOODS, INC.
By: /s/ By: /s/ Xxxxxx X. Xxxx
----------------------------- ------------------------------------
Title: VP Sales and Marketing Xxxxxx X. Xxxx
Chief Operating Officer
[*] confidentiality requested
-2-
SECOND MODIFICATION TO SUPPLY AGREEMENT
This Second Modification to Supply Agreement is made as of May 1, 1995
hereof by and between Tyson Food's Inc., XX Xxx 0000, Xxxxxxxxxx, XX 00000-0000
("Tyson") and Xxxxxx'x Distribution, Inc., 000 Xxxxx Xxxxxx, XX, PO Box 61031,
LeMars, Iowa, ("HDI") (collectively the "Parties").
RECITALS
X. Xxxxx, through its then subsidiary, Xxxxxx'x, Inc. executed an Asset
Purchase Agreement dated June 22, 1990, wherein Xxxxxx'x, Inc. agreed
to sell to HDI that portion of its distribution business located a
LeMars, Iowa.
B. As a part of the transactions contemplated by the Asset Purchase
Agreement, HDI and Tyson executed a Supply Agreement dated November 9,
1990, as amended by Modification to Supply Agreement (the "First
Modification") dated September 14, 1993, (collectively the "Supply
Agreement").
C. Subsequently, Xxxxxx'x, Inc. was merged into Tyson.
D. The Parties hereby intend to further modify the Supply Agreement as
set forth herein.
Now, therefore, in consideration of the premises and the mutual covenants
and Agreements herein contained, it is agreed by and between Tyson and HDI that
the Supply Agreement is amended as follows:
1. The purchase requirements (in pounds) set forth in Part Two to Exhibit "B"
of the Supply Agreement, shall, for the period October 1, 1995 to September
28, 1999, be that amount reflected for each product category during Period
Six, provided however, that the obligation of HDI to purchase a minimum
total amount of products, regardless of category, shall remain as provided
in the First Modification. A copy of the First Modification is attached
hereto marked Exhibit A and by this reference made a part hereof.
2. Section 6 of the Supply Agreement is deleted.
3. Section 11 of the Supply Agreement is deleted and substituted in lieu
thereof is the following:
11. Term of Agreement. This Agreement shall remain in full force and
-----------------
effect through September 28, 1999, unless sooner terminated as provided in
Section 12.
4. Section 12 of the Supply Agreement is deleted and substituted in lieu
thereof is the following:
12. Termination. In the event either the Purchaser or Tyson fails to
-----------
perform its obligations under this Agreement, the defaulting party shall
have sixty (60) days from the date of receipt of notice to cure such
default by remedying the default in the appropriate manner. In the event
such default is not cured within the sixty day period by the defaulting
party, the non-defaulting party shall have the right to terminate this
Agreement and to assert such rights and remedies for breach of this
Agreement as are provided by law.
Except as modified by this Second Modification to Supply Agreement, the Supply
Agreement shall remain in full force and effect.
Dated as of May 1, 1995.
TYSON FOODS, INC.
By: /s/
---------------------------------
Attest: /s/
-----------------------------
XXXXXX'X DISTRIBUTION, INC.
By: /s/ Xxxxxx X. Xxxxxx
---------------------------------
Attest: /s/
-----------------------------
-2-
Exhibit A
[Filed previously within this exhibit]
-3-
ASSIGNMENT, ASSUMPTION AND CONSENT AGREEMENT
This ASSIGNMENT, ASSUMPTION AND CONSENT AGREEMENT (the "Agreement") is
entered into as of the 25th day of November, 1996, by and among Tyson Foods,
Inc., a Delaware corporation ("Assignor"), Gorges/Quik-to-Fix Foods, Inc., a
Delaware corporation ("Assignee"), and Xxxxxx'x Distribution, Inc., an Iowa
corporation ("Purchaser").
WITNESSETH:
WHEREAS, Assignor and Assignee entered into that certain Asset Purchase
Agreement dated as of October 17, 1996 (the "Purchase Agreement") pursuant to
which Assignee agreed to purchase from Assignor all of the assets used in the
operations of the beef further processing business of Assignor (other than
certain excluded assets) (collectively, the "Business"); and
WHEREAS, in Assignor's operation of the Business, Assignor and Purchaser
entered into that certain Supply Agreement dated as of November 9, 1990 which
has been subsequently modified by that certain Modification to Supply Agreement
dated as of September 14, 1993 and that certain Second Modification to Supply
Agreement dated as of May 1, 1995 (as modified to date, the "Supply Agreement")
pursuant to which Assignor sells to Purchaser and Purchaser buys from Assignor
certain Products of Assignor, and
WHEREAS, Assignor and Purchaser also entered into that certain License
Agreement dated as of November 9, 1990 (the "License Agreement") pursuant to
which Purchaser has granted a license to Assignor to use the Trademarks (as such
term is defined in the License Agreement); and
WHEREAS, Assignor desires to assign certain of its obligations under the
Supply Agreement and the right to use certain of the Trademarks under the
License Agreement to Assignee; and
WHEREAS, Assignor and Purchaser desire to terminate any obligation of
either party with respect to those obligations under the Supply Agreement which
are not assigned to Assignee pursuant hereto;
NOW, THEREFORE, in consideration of the premises recited, of the covenants,
agreements and provisions of this Agreement, and of other good and valuable
-4-
consideration, the receipt and sufficiency of which the parties hereby
acknowledge, the parties hereby agree as follows:
1. ASSIGNMENT. Assignor hereby assigns to Assignee (a) all of its rights
----------
under the Supply Agreement with respect to the providing of food products to
Purchaser within the Product Categories (as such term is defined in the Supply
Agreement) other than Chicken Products (as such term is defined in the Supply
Agreement) and (b) all of its right under Sections l(a) and l(b) of the License
Agreement with respect to the use of the Trademarks listed on Exhibit "A"
attached hereto and made a part hereof.
2. ASSUMPTION. Assignee hereby accepts such assignment and hereby agrees
----------
to assume, and does assume, the due and full performance of the obligations of
the Assignor under or pursuant to the Supply Agreement and the License Agreement
accruing on or after the date of this Agreement, but not before, insofar as such
obligations relate to the rights assigned by Assignor to Assignee hereunder.
3. ADDITIONAL AGREEMENT. It is expressly agreed, as between Assignor and
--------------------
Assignee, that the assignment hereunder is given pursuant to and subject to all
of the terms, provisions, covenants, warranties, representations and indemnities
contained in the Purchase Agreement.
4. CONSENT. Purchaser (a) hereby consents to the assignments hereunder
-------
and (b) acknowledges that Assignee is relying on the consent of Purchaser in
accepting the assignment hereunder.
5. TERMINATION.
-----------
(a) Assignor and Purchaser hereby agree that as of the date hereof
Assignor has no further obligation to supply to Purchaser and Purchaser has
no further obligation to purchase from Assignor any food products under the
Supply Agreement.
(b) Assignee and Purchaser hereby agree that the license under the
License Agreement transferred and assigned to Assignee hereunder shall
terminate two (2) years from the date hereof. After such date, Assignee
shall not use or make any use of such assigned Trademarks.
6. NOTICES. Any notice or communication required or permitted to be given
-------
hereunder shall be in writing and shall be deemed to have been duly given (i)
when received if personally delivered or sent by telex or facsimile transmission
(with confirmed receipt), (ii) three (3) days after being sent by registered or
-5-
certified mail, return receipt requested, postage prepaid, or regular airmail,
postage prepaid, to the parties, or (iii) one (1) day after sent by express
courier (e.g. FedEx), if receipt is confirmed by the delivery agent, at their
respective addresses set forth below (or such other address as may be designated
pursuant hereto):
If to Assignor, to: Tyson Foods, lnc.
0000 Xxxxxxx Xxxxx
P.O. Box 2020
Springdale, Arkansas 72765-2020
Attn: Xxxx X. Xxxxx
(000) 000-0000
(000) 000-0000 (FAX)
If to Assignee, to: Gorges/Quik-to-Fix Foods, Inc.
x/x Xxxxxx, Xxxxx & Xxxxxx
Xxxxx 000
Twelve Piedmont Center
Xxxxxxx, Xxxxxxx 00000
Attn: Xxxx Xxxxxx
(000) 000-0000
(000) 000-0000 (FAX)
If to Purchaser, to: Xxxxxx'x Distribution, Inc.
X.X. Xxx 0000
000 Xxxxxx Xxxxxx
Xx Xxxx, Xxxx 00000
Attn: Xxxxxx X. Xxxxxx
(000) 000-0000
(000) 000-0000 (FAX)
7. MISCELLANEOUS:
-------------
(a) Governing Law. This Agreement shall be construed in accordance
-------------
with, and governed by, the laws of the State of Delaware.
(b) Entire Agreement. This Agreement constitutes the entire agreement
----------------
among Assignor, Assignee and Purchaser with respect to the subject matter
hereof, and supersedes all prior agreements and understandings among
Assignor, Assignee and Purchaser with respect to the subject matter hereof.
(c) Amendments. This Agreement shall not be modified or amended
----------
except by an instrument, in writing, signed by Assignor and Assignee.
-6-
(d) Waiver. The failure of any party to insist, in one or more
------
instances, on the performance by another party in strict accordance with
any term or condition of this Agreement shall not be deemed a waiver or
relinquishment of any right granted hereunder or of any right to demand
future performance of any such term or condition of this Agreement, unless
such waiver is set forth in a written instrument signed by such party or a
duly authorized representative of the waiving party and then only to the
extent set forth therein. No waiver of any provision or provisions of this
Agreement shall be deemed to constitute a waiver of any other provision.
(e) Counterparts. This Agreement may be executed simultaneously in
------------
any number of counterparts, each of which shall be deemed an original, but
all of which shall constitute one and the same instrument.
(f) Titles and Headings. Titles and headings to Sections herein are
-------------------
for purposes of reference only, and shall in no way limit, define or
otherwise affect the meaning or interpretation of any of the provisions of
this Agreement.
(g) Binding Effect. This Agreement shall be binding upon and shall
--------------
inure to the benefit of the parties hereto and their respective successors
and assigns.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their duly authorized officers as of the date first above written.
ASSIGNOR:
TYSON FOODS, INC.
By: /s/ Xxxxx X. Xxx Xxxxxx
------------------------------
Title: Assistant Secretary
---------------------------
ASSIGNEE:
GORGES/QUIK-TO-FIX FOODS, INC.
By: /s/ Xxxxxxx X. Xxxxxx
------------------------------
Title: /s/ Secretary
---------------------------
-7-
PURCHASER:
XXXXXX'X DISTRIBUTION, INC.
By: /s/ Xxxxxx X. Xxxxxx
--------------------------------
Title: /s/ President and CEO
----------------------------
-8-
EXHIBIT "A"
-----------
ASSIGNED TRADEMARKS
-------------------
TRADEMARKS REGISTRATION/SERIAL NO.
---------- -------------------------
Xxxxxx'x Registration No. 1,051,980
Xxxxxx'x Homestyle Registration No. 1,528,452
Xxxxxx'x Homestyle & Design Registration No. 1,523,685
Xxxxxx'x Homestyle Burgers Registration No. 1,465,698
Xxxxxx'x Homestyle Burgers & Design Registration No. 1,465,699
Xxxxxx'x Homestyle Entree Registration No. 1,465,696
Xxxxxx'x Homestyle Entree & Design Registration No. 1,465,697
Xxxxxx'x Ready Lean Registration No. 1,570,005
-9-
