1
EXHIBIT 2.4
TRANSITION SERVICES - SUPPLY AGREEMENT
BETWEEN
RALCORP HOLDINGS, INC.
AND
NEW RALCORP HOLDINGS, INC.
FOR
"CHEX" AND "COOKIE CRISP" CEREALS
2
TABLE OF CONTENTS
TRANSITION SERVICES - SUPPLY AGREEMENT
PART I SUPPLY AGREEMENT
-----------------------
SECTION 1 DEFINITIONS 1
SECTION 2 TERM 3
SECTION 3 PERFORMANCE 3
SECTION 4 PRODUCTION SYSTEM 4
SECTION 5 MATERIALS 4
SECTION 6 SAMPLING AND TESTING 4
SECTION 7 STORAGE 5
SECTION 8 REJECTION 5
SECTION 9 INSPECTION 6
SECTION 10 SUPPLY; QUANTITIES 7
SECTION 11 PAYMENT 8
SECTION 12 WARRANTIES AND COVENANTS 9
SECTION 13 INSURANCE 10
SECTION 14 INDEMNIFICATION 11
SECTION 15 CONFIDENTIAL INFORMATION 13
SECTION 16 INTELLECTUAL PROPERTY 14
SECTION 17 BREACH 14
SECTION 18 TERMINATION 15
SECTION 19 RALCORP PRICING 15
SECTION 20 RIGHTS RESERVED TO RALCORP 15
SECTION 21 ASSIGNMENT 16
SECTION 22 INTERPRETATIONS 16
SECTION 23 DISCRIMINATION 16
SECTION 24 ENTIRE AGREEMENT 16
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TABLE OF CONTENTS (CONT.)
TRANSITION SERVICES - SUPPLY AGREEMENT
XXXXXXX 00 XXXXX XXXXXXX 16
SECTION 26 GOVERNING LAW 17
SECTION 27 INDEPENDENT CONTRACTOR 17
SECTION 28 NOTICE 17
SECTION 29 REGULATORY NOTICE 18
SECTION 30 SUCCESSORS AND ASSIGNS 18
SECTION 31 WAIVER 18
SECTION 32 AUTHORIZATION; VALIDITY 18
PART II TRANSITION SERVICES 18
SCHEDULE(S)
SCHEDULE - 1 22
SCHEDULE - 2 26
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TRANSITION SERVICES - SUPPLY AGREEMENT
This Transition Services - Supply Agreement ("Agreement"), dated as of
, 199 , is between RALCORP HOLDINGS, INC., a Missouri corporation
("Ralcorp"), and NEW RALCORP HOLDINGS, INC., a Missouri corporation ("Supplier")
on behalf of itself, its subsidiaries and Affiliates.
WHEREAS, Ralcorp and Supplier possess certain Technical Information for
the manufacture of ready-to-eat (RTE) cereals; and,
WHEREAS, Ralcorp wishes Supplier to produce certain of such products on
behalf of Ralcorp and to provide certain other transition services to Ralcorp;
and
WHEREAS, Supplier is willing to produce those products and provide those
other transition services specified herein.
In consideration of the mutual agreements, promises and covenants herein
contained, the parties hereby agree as follows:
PART I.
SUPPLY AGREEMENT
SECTION 1 DEFINITIONS
A. "FDCA" shall mean the Federal Food, Drug and Cosmetic Act,
including its amendments and regulations.
B. "Laws" shall mean the FDCA and all applicable state and municipal
statutes, rules and regulations substantially similar to the FDCA.
C. "Nonconforming Products" shall mean Products which do not comply
with the FDCA, other Laws or the Specifications referred to below.
D. "Plant" shall mean, for the production of rice-based cereal
packaged using the "CHEX" trademark (i.e. Rice Chex), Supplier's Battle
Creek, Michigan cereal plant, up to its
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capacity as defined in Schedule 1; and for cereal packaged using the
"COOKIE CRISP" trademark, Supplier's Lancaster, Ohio cereal plant, up to
its capacity as defined in Schedule 1; and Supplier's Sparks, Nevada
cereal plant, to the extent Supplier deems reasonably necessary to
utilize such plant for production of Cookie Crisp cereal in lieu of the
Lancaster, Ohio plant.
E. "Product(s)" shall mean Products Of The Type which have been
offered for sale in connection with any form of any CHEX or COOKIE
CRISP trademarks.
F. "Technical Information" shall mean all formulae, information
concerning manufacturing processes and know-how, quality control data,
test data and all other scientific and/or technical data and
information ("data") relating to the development, manufacture,
distribution, sale, or use of the Products and all proprietary rights
embodied therein and related thereto which is licensed by Ralcorp or
its Affiliates to Supplier or its Affiliates, or provided to Supplier
by Ralcorp or which may hereafter be developed by Ralcorp and provided
to Supplier by Ralcorp, whether provided in oral, written or other form
including, but not limited to, any patent or patent application,
formulation, software, product and packaging specifications, trade
secrets and know-how.
G. "Specifications" shall mean the formulas and specifications for the
Products and their production, processing and packaging, which shall
reflect the actual operating conditions and practices of Supplier as of
the date of this Agreement and as such may be amended from time to time
upon reasonable advance written notice by Ralcorp, and other
information relating to quality control, processing, packaging and
administrative procedures as the parties shall mutually agree upon
prior to Closing (the "Other Information"). The parties shall set
forth the terms of the Other Information as an Exhibit hereto (the
"Other Information Exhibit"). The Other Information Exhibit shall be
made a part hereof, and may be amended from time to time by written
agreement of the parties..
H. The term "Products Of The Type" shall mean the identical products
and all products substantially similar in form or in overall appearance
to such products, whether or not they are similar in flavor or are used
in association with other ingredients (e.g. raisins).
I. All other capitalized terms used but not otherwise defined herein
shall have the meanings ascribed thereto in the Reorganization
Agreement dated as of the date hereof, by and
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among Supplier, Ralcorp, Xxxxxxx Foods, Inc. ("Foods"), General Xxxxx,
Inc. ("General Xxxxx"), General Xxxxx Missouri, Inc. ("General Xxxxx
Missouri") and the Branded Subsidiary (the "Reorganization
Agreement").
SECTION 2 TERM
This Agreement shall commence immediately after the Closing Date (the
"Closing Date") of the Agreement and Plan of Merger by and among Ralcorp,
General Xxxxx and General Xxxxx Missouri, dated as of August 13, 1996 (as
amended on October ___, 1996, the "Merger Agreement").
This agreement shall expire, with respect to COOKIE CRISP, eighteen months
after the Closing Date; provided that Ralcorp may extend this Agreement,
with respect to COOKIE CRISP, for a second term not to exceed six (6)
months, by notice given not less than sixty (60) days prior to the
expiration of such initial term.
This Agreement shall expire, with respect to RICE CHEX, eighteen months
after the Closing Date.
SECTION 3 PERFORMANCE
A. General Understanding. Supplier agrees to use reasonable efforts
to produce the Products in accordance with the provisions of this
Agreement.
B. Performance. Supplier's performance hereunder, including its
production, packaging and labeling of Products, and handling and
storing ingredients and packaging materials, including stretch wrap,
if any, to be used in connection with Products produced on Ralcorp's
behalf ("Materials"), shall be in accordance with the terms of this
Agreement, including, without limitation, the Specifications. Ralcorp
reserves the right at any time to modify, delete or add to the
Specifications provided that Ralcorp allows Supplier reasonable time
in each instance to implement any changes necessitated by such
revisions in the Specifications so that Product(s) will remain in
compliance with such Specifications. If any such modification(s) as
approved by Supplier result(s) in additional costs to Supplier,
Supplier shall be entitled to a cost increase equal to the reasonable
additional costs resulting therefrom in accordance with Section 11
hereof. Such costs may include the costs of disposing of
Nonconforming Product if Supplier determines, in
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its reasonable discretion, that it will be unable, exercising reasonable
efforts, to consistently meet such revised Specifications, and notifies
Ralcorp accordingly. All Exhibits and Schedules attached hereto or
referred to herein are incorporated by reference herein and form part of
this Agreement.
SECTION 4 PRODUCTION SYSTEM
Supplier's Equipment. Supplier shall provide all equipment and personnel
necessary to produce, package and ship Products in accordance with the terms
hereof without any additional costs to Ralcorp beyond those incorporated
into the respective Product prices and/or rates as described in Section 11A.
SECTION 5 MATERIALS
Securing Materials and loss of yield shall be in accordance with Schedule 1
attached hereto.
SECTION 6 SAMPLING AND TESTING
A. Materials. Supplier shall inspect, sample, analyze and test all
Materials received by Supplier to be used to produce or package
Products in accordance with the Specifications. Any Materials which do
not comply with the requirements of the Specifications shall not be
used by Supplier for any reason in connection with the Products, and
Supplier shall immediately notify Ralcorp of all such nonconforming
Material(s) when such Material(s) were supplied by Ralcorp or purchased
on Supplier's behalf by Ralcorp. The parties shall provide Materials
in accordance with the terms set forth in Schedule 1.
B. Products. Supplier shall sample and test the Products in
accordance with the Specifications. Supplier shall also segregate for
testing by Ralcorp such quantities of packaged Products and Materials
as Ralcorp may from time to time reasonably request and Supplier shall,
at Ralcorp's expense, ship such packages and Materials to such
destinations as specified by Ralcorp.
C. Protection. Supplier shall exercise reasonable care in handling,
storing and protecting the Products and Materials intended for use in
the Products.
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SECTION 7 STORAGE
Supplier shall provide suitable Ralcorp approved storage and warehousing
space ("space") in accordance with Schedule 1.
SECTION 8 REJECTION
A. Supplier shall not knowingly ship any Nonconforming Products to
Ralcorp.
B. Nothing contained in this Agreement shall be deemed to obligate
Ralcorp to inspect any products purchased hereunder.
C. Without limiting any other rights available to Ralcorp with respect
to Nonconforming Products which are in violation of any Laws, unless
otherwise agreed by the parties, in the event that Supplier produces
any Nonconforming Products, Supplier shall promptly replace such
Products at no cost to Ralcorp (including any additional freight costs
incurred), except to the extent such nonconformance was as the result
of Ralcorp's actions, including but not limited to if such
nonconformance was attributable to Materials supplied by Ralcorp or
purchased on Supplier's behalf by Ralcorp. Replacement of
Nonconforming Products by Supplier at no cost to Ralcorp shall be
Ralcorp's sole remedy with respect to Nonconforming Products which are
not in violation of any Laws.
D. Nonconforming Products still within Supplier's possession shall be
destroyed or disposed of pursuant to instructions provided by Ralcorp.
Such disposal shall be at the expense of Supplier, except to the extent
such nonconformance was as the result of Ralcorp's actions, including
but not limited to if such nonconformance was attributable to Materials
supplied by Ralcorp or purchased on Supplier's behalf by Ralcorp. In
no event shall Supplier sell, distribute or ship any Nonconforming
Products in violation of Ralcorp's instructions. Notwithstanding the
above, Supplier may, subject to Ralcorp's consent, donate such Products
provided they are removed from the normal retail packaging prior to
ultimate distribution.
E. Supplier shall code the Products in accordance with the
Specifications.
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SECTION 9 INSPECTION
A. Records. Supplier shall maintain, at the Plant, true, accurate and
complete records in respect of Products production, packaging, storage,
sampling, testing and shipment hereunder ("Records") in accordance with
Supplier's Record Retention Policy, a copy of which will be provided to
Ralcorp. Upon written notice to Supplier from Ralcorp, Supplier shall
permit Ralcorp to (i) inspect the Records at the Plant and at mutually
convenient times and locations, and (ii) take inventory of Materials
and finished Products produced by Supplier for Ralcorp.
B. Inventories. Supplier shall provide Ralcorp access to Supplier's
reports related to Supplier's inventory of Products and Materials in
accordance with the Specifications.
C. Plant. During the period(s) Supplier is performing any of its
services hereunder and upon reasonable advance notice, Ralcorp may
inspect, at Ralcorp's cost, areas of the Plant where Materials or
Products are handled, processed, sampled, tested, packaged or stored
hereunder for the purposes of inspecting the Plant and its facilities,
and the Products, Materials and procedures followed by Supplier;
provided, however, that Supplier shall have the right to accompany
Ralcorp on any such inspections; and provided, further that such
inspection(s) shall not relieve Supplier of any of its obligations
hereunder. Supplier shall, in good faith, explore the possibility and
feasibility of changing its procedure(s) whenever such changes are
determined by Ralcorp as necessary or desirable in order to correct
and/or improve the Products, the conditions of processing and packaging
and the procedures followed hereunder. Supplier has the right to
restrict access to any location, material or equipment that is
proprietary to Supplier's continued production of other products;
provided, however, that such restrictions shall not prevent Ralcorp's
representatives from having access to the areas of the Plant where
Materials or Products are handled, processed, packaged or stored
hereunder, for the purposes of inspecting the Plant and its facilities,
and the Products, Materials and procedures followed by Supplier.
D. Immediate Notice. Supplier shall immediately notify Ralcorp of any
sanitation audits, the results of which indicate the presence of any
food pathogens in the Plant or possible adulteration of the Products.
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SECTION 10 SUPPLY; QUANTITIES
A. To ensure that Ralcorp shall have sufficient Products during the first
18 months of the transition following the above referred to Merger (and
an additional 6 months with respect to COOKIE CRISP in the event that
Ralcorp renews this Agreement in accordance with Section 2), Ralcorp
shall have the sole and exclusive right to Supplier's and its
subsidiaries' and Affiliates' available capacity and rights to make
Products, at all of their plants and facilities, during the term hereof
(i) up to 8,400 cwt. a month of RICE CHEX and 10,000 cwt. a month for
COOKIE CRISP, and (ii) beyond these levels, other than as reasonably
necessary to meet Supplier's requirements for CHEX-type ready to eat
cereal Products to be sold by Supplier under Private Label Trademarks
and Supplier's obligations under its Exclusive Distribution Agreement
with Xxxxxxx Purina Company, dated April 1, 1994 (the "RP Agreement"),
with any demands exceeding Supplier's ability to supply allocated
proportionally between Ralcorp and Xxxxxxx Purina Company,
based upon total quantities ordered after Supplier first meets
Ralcorp's monthly requirements for RICE CHEX up to 8,400 cwt. a month
and for COOKIE CRISP up to 10,000 cwt. a month and Supplier's
requirements for CHEX type ready to eat cereal Products (after Supplier
has first met Ralcorp's monthly requirements, up to 8,400 cwt. a
month); provided, however, that any production of Products for
Supplier or Xxxxxxx Purina Company pursuant to such agreement shall
not include the use of any of the CHEX or COOKIE CRISP trademarks or
any other trademarks or trade dress owned by Ralcorp or its Affiliates
except as otherwise agreed in writing by Ralcorp. Further, it is
understood and acknowledged that the calculation of available capacity
for RICE CHEX production has taken into account Supplier's anticipated
capacity requirements for its store brand hexagon shaped biscuit
product sold under several names, including Crispy Hexagons, among
others, and, in any event, Supplier's obligation to supply Ralcorp
hereunder shall not exceed Supplier's capacity as set forth in
Schedule 1. Ralcorp may order and Supplier shall produce for Ralcorp
Products ordered in accordance with firm orders as set out in Schedule
1. Ralcorp agrees that it will order a minimum of 90,000 cwt. of
Cookie Crisp cereal during the term, and a minimum of 2,000 cwt. in
any given month during the COOKIE CRISP Commitment Period (as defined
in Schedule 1C). Ralcorp agrees that in any month during the term in
which Ralcorp orders Rice Chex cereal, Ralcorp will order a minimum of
6,000 cwt. of Rice Chex cereal in such month.
B. Except for such production of Products (which shall not include the use
of the CHEX or COOKIE CRISP trademarks or other trademarks and trade
dress of Ralcorp or its Affiliates), if any as may be necessary, as set
forth above, for Supplier for CHEX-type ready to eat cereal Products
sold under Private Label Trademarks and for Xxxxxxx Purina Company
under the RP Agreement, during the term Supplier shall produce Products
solely and exclusively for Ralcorp.
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SECTION 11 PAYMENT
A. Product Price. Subject to the provisions of Sections 3B and 11B,
Ralcorp shall pay Supplier an amount equal to $37.09 per cwt. of COOKIE
CRISP for the period beginning at the commencement of the term of this
Agreement and ending on September 30, 1997, $38.28 per cwt. of COOKIE
CRISP for the period beginning on October 1, 1997 and ending on
September 30, 1998, and $39.50 per cwt. of COOKIE CRISP thereafter, for
Supplier's manufacturing variable costs, warehouse variable costs,
fixed manufacturing and fixed warehouse costs for COOKIE CRISP produced
and packaged in accordance with this Agreement. Ralcorp shall pay
Supplier an amount equal to actual costs for all Materials provided by
Supplier in connection with COOKIE CRISP produced and packaged in
accordance with this Agreement, subject to yield losses set forth in
Schedule 1E.
Subject to the provisions of Sections 3B and 11B, Ralcorp shall pay
Supplier an amount equal to $38.64 per cwt. of RICE CHEX for the period
beginning at the commencement of the term of this Agreement and ending
on September 30, 1997 and $39.94 per cwt. of RICE CHEX for the remainder
of the term of this Agreement, for Supplier's manufacturing variable
costs, warehouse variable costs, fixed manufacturing and fixed warehouse
costs (excluding depreciation costs with respect to Building 3 of
Supplier's Plant location at Battle Creek, Michigan and the equipment
utilized therein) for RICE CHEX produced and packaged in accordance with
this Agreement. Ralcorp shall pay Supplier an amount equal to actual
costs for all Materials provided by Supplier in connection with RICE
CHEX produced and packaged in accordance with this Agreement, subject to
yield losses set forth in Schedule 1E.
In addition, Ralcorp shall pay Supplier an amount (the "Commitment
Amount") equal to $85,500 for each month in the RICE CHEX Commitment
Period, as such term is defined in Schedule 1C. The Commitment Amount
for any month in the RICE CHEX Commitment Period shall be reduced by an
amount which bears the same ratio to $85,500 as the Supplier Weight (as
defined below) for such month bears to the Aggregate Weight (as defined
below) for such month.
The term "Supplier Weight" means, for any month in the RICE CHEX
Commitment Period, the total weight of all products produced by
Supplier in Building 3 of
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Supplier's Plant location at Battle Creek, Michigan, other than such
Products produced by Supplier for Ralcorp, alone in accordance with
the terms of this Agreement.
The term "Aggregate Weight" means, for any month in the RICE CHEX
Commitment Period, the total weight of all products produced by
Supplier in Building 3 of Supplier's Plant location at Battle Creek,
Michigan.
For each month in the Subsequent Period (as defined below) that Supplier
utilizes Building 3 of Supplier's Plant location at Battle Creek,
Michigan, Supplier shall pay to Ralcorp an amount equal to 50 percent of
the quotient of (x) the sum of the Commitment Amounts for each Non-use
Month (as defined below), divided by (y) the aggregate number of Non-use
Months.
The term "Subsequent Period" means the period of consecutive months
equal in number to the aggregate number of Non-use Months, commencing
upon the termination of the RICE CHEX Commitment Period.
The term "Non-use Month" means any month in the RICE CHEX Commitment
Period during which Building 3 of Supplier's Plant location at Battle
Creek, Michigan is not utilized for the production of RICE CHEX for
Ralcorp in accordance with this Agreement.
Product will be shipped F.O.B. Plant. Supplier will invoice Ralcorp
monthly for all production. Payment terms will be net 11 days.
Yield losses will be addressed as identified in Schedule 1E.
B. Cost Savings. The parties agree to cooperate throughout the term
of this Agreement to identify methods of reducing the cost of the
Products and shall meet periodically to discuss cost savings plans.
SECTION 12 WARRANTIES AND COVENANTS
A. Supplier represents, warrants and covenants that:
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1. Except to the extent arising out of the actions of Ralcorp or
from Materials provided by Ralcorp or purchased on Supplier's behalf
by Ralcorp, Supplier's performance hereunder shall be in accordance
with all the terms of this Agreement, including the Specifications,
and be free of defects in workmanship and materials, except for
defects arising from conformity with the applicable Specifications
to the extent such Specifications were modified per Ralcorp's
request;
2. Supplier shall not cause any of the Products processed,
packaged, stored, labeled and shipped hereunder to be adulterated or
misbranded, within the meaning of Laws, or to be products which may
not, under any of the provisions thereof, be introduced into
interstate commerce, and the Products shall comply with all Laws;
3. Supplier's performance hereunder, including, without
limitation, the maintenance of the Plant, shall at all times be in
compliance with all Laws.
B. Ralcorp's sampling Products and/or approving it for shipment shall
neither relieve Supplier of its warranties hereunder nor be construed
as a waiver of any of Supplier's obligations hereunder.
C. Ralcorp represents and warrants that compliance with the
Specifications of this Agreement, to the extent modified per Ralcorp's
request, shall not cause any of the Products processed, packed and
labeled hereunder to be adulterated or misbranded, within the meaning
of the FDCA, or to be products which may not, under any of the
provisions thereof, be introduced into interstate commerce.
SECTION 13 INSURANCE
On or before execution of this Agreement, Supplier shall obtain:
A. Product liability insurance on an occurrence basis with issuers
acceptable to Ralcorp. The product liability insurance to be
maintained shall provide coverage of Two Million Dollars ($2,000,000)
per occurrence, with a Five Million Dollars ($5,000,000) annual
aggregate;
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B. Public liability insurance, including contractual liability with
limits of not less than Two Million Dollars ($2,000,000);
C. Worker's compensation insurance in accordance with the Laws where
the Plant is located on all employees engaged in any way in the work
pursuant to this Agreement; and
D. Broad form vendor's liability coverage.
Each such policy shall provide that it may not expire or be canceled except
upon thirty (30) days' prior written notice to Ralcorp. Upon the execution
of this Agreement, and upon every insurance renewal during the term of this
Agreement, Supplier shall deliver to Ralcorp (i) a certificate of insurance
evidencing such insurance, (ii) if requested by Ralcorp, a true and complete
copy of the policy as then in effect, and (iii) proof of payment of
premiums. Notwithstanding the foregoing Ralcorp shall not be under a duty to
examine such policy.
Ralcorp does not in any way represent that the insurance coverage specified
herein is sufficient or adequate to protect Supplier's interests or
potential liabilities.
SECTION 14 INDEMNIFICATION
A. Supplier hereby indemnifies Ralcorp and forever holds Ralcorp
(including its parent, subsidiary and Affiliated corporations, and
their respective directors, officers, employees and agents) and its
customers harmless from and against all claims, suits, actions,
proceedings, damages, losses or liabilities, costs or expenses
(including reasonable attorneys' fees, expenses and amounts paid in
settlement) (but excluding consequential damages (which shall include
but not be limited to lost profits))("Claims") incurred by Ralcorp
arising out of, based upon, or in connection with any (i) material
breach of any of Supplier's warranties, representations or agreements
under this Agreement, (ii) injuries or damages to third parties arising
from or in any way related to the use or consumption of any Products
produced by Supplier for Ralcorp pursuant to this Agreement, to the
extent arising out of the condition of such Product(s) as of the date
of shipment to Ralcorp (except to the extent attributable to Materials
supplied by Ralcorp or purchased on Supplier's behalf by Ralcorp),
(iii) actual or alleged injury to person or property or death occurring
to any of Supplier's employees, agents or any individual on Supplier's
premises, (iv) fines and penalties for statutory violations of Laws
attributable to Supplier
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in connection with Supplier's manufacture of Products pursuant to this
Agreement, (v) claim or action by any person alleging that use of any
know-how, machinery, equipment or process employed by Supplier in
connection with the manufacture of the Products produced by Supplier for
Ralcorp pursuant to this Agreement infringes upon any rights of any
third party or violates other rights, and (vi) all reasonable costs of
any recall of Products produced pursuant to the terms hereof as to which
Supplier has consented, such consent not to be unreasonably withheld.
In the event of any Claims made against Ralcorp, Ralcorp shall notify
Supplier of such claim promptly upon a representative of Ralcorp
obtaining knowledge of such Claim, provided that failure to give such
notice shall not relieve Supplier from its indemnity hereunder, except
to the extent Supplier is prejudiced thereby. Thereafter, Supplier, at
its sole cost and expense, may assume the defense of any claim for which
it is required to indemnify Ralcorp pursuant to this Section 14A, using
counsel of its own choice. Notwithstanding anything in this Section 14
to the contrary, Supplier shall not, without Ralcorp's prior written
consent, which consent shall not be unreasonably withheld, settle or
compromise any Claim or consent to entry of any judgment with respect to
any Claim for anything other than money damages paid by Supplier which
would have a material adverse effect on Ralcorp. Supplier may, without
Ralcorp's prior written consent, settle or compromise any Claim or
consent to entry of any judgment with respect to any Claim which
requires solely money damages paid by Supplier and which includes as an
unconditional term thereof the release of Ralcorp and its Affiliates by
the plaintiff from all liability in respect of such Claim. Ralcorp
shall make available to Supplier all records and other materials
reasonably required for use in contesting any Claim and shall cooperate
fully with Supplier in the conduct and defense of any Claim.
B. Ralcorp hereby indemnifies Supplier and forever holds Supplier
(including its parent, subsidiary and Affiliated corporations, and
their respective directors, officers, employees and agents) and its
customers harmless from and against all Claims incurred by Supplier
arising out of, based upon, or in connection with any (i) material
breach of any of Ralcorp's warranties, representations or agreements
under this Agreement, (ii) injuries or damages to third parties arising
from or in any way related to the use of or consumption of any Products
produced by Supplier for Ralcorp to the extent such injuries or damages
are attributable to Materials or premiums supplied by Ralcorp or
purchased on Supplier's behalf by Ralcorp, or from conditions which
arise after Products were made available for shipment to Ralcorp; (iii)
fines, penalties or any other actions or claims arising out of
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alleged violations of any laws or regulations, including Laws, as a
result of any Product claims made by Ralcorp (e.g. health claims) or
other copy, graphics, coupons and promotional offers used in connection
with such Products on packaging or in advertising (except when such
violation arises from Supplier's breach of this Agreement); (iv) claim
or action by any person alleging that use of any know-how, machinery,
equipment or process employed by Supplier at Ralcorp's behest after the
Closing in connection with the manufacture of Products for Ralcorp
infringes upon any rights of any third party.
C. The provisions of this Section 14 shall survive the termination of
this Agreement.
SECTION 15 CONFIDENTIAL INFORMATION
A. Except as expressly provided in the Technology Agreement, Supplier
shall not use the Specifications, Technical Information owned by or
licensed to Ralcorp and all other confidential information of Ralcorp
for any reason other than the production of Products in accordance with
the terms of this Agreement and shall not disclose this information to
any third party and shall keep confidential all such information. The
terms of this provision shall survive the expiration or termination of
this Agreement.
B. Except as expressly provided in the Technology Agreement, Ralcorp
shall not use any confidential information of Supplier that Ralcorp is
not otherwise specifically entitled to use pursuant to the terms of the
Technology Agreement, including but not limited to information
pertaining to the operation of Plants, and production of other products
at such facilities, and Ralcorp shall not disclose this information to
any third party and shall keep confidential all such information. The
terms of this provision shall survive the expiration or termination of
this Agreement.
C. The obligations of nondisclosure, contained in Paragraphs 15A and B
above, shall not apply in the event that any of such information:
(a) was known to the public or generally available to the public
prior to the date it was received from the disclosing party:
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(b) became known to the public or generally available to the
public subsequent to the date it was received from the disclosing
party without any fault of the receiving party; or
(c) is, subsequent to the date of this Agreement, disclosed to
the receiving party from a third party who is under no obligation of
confidentiality regarding the same.
SECTION 16 INTELLECTUAL PROPERTY
Nothing in this Agreement shall be construed to grant to Supplier any right
to or interest in (i) any trademark, trade name, trade dress, copyright and
patent right or (ii) except as may be provided in the Technology Agreement,
any other rights, including any rights to any Technical Information and Know
How which is owned by or licensed to Ralcorp or its Affiliates
("Intellectual Property").
SECTION 17 BREACH
The following actions shall each constitute a breach of this Agreement.
A. The institution by Supplier or Ralcorp of a voluntary case under
any chapter of the Bankruptcy Code (Title 11, United States Code), or
any equivalent or similar action under any other federal or state law
in effect at such time relating to bankruptcy or insolvency, or if a
petition is filed against Supplier or Ralcorp under the Bankruptcy
Code, or if a petition is filed seeking any such equivalent or similar
relief against Supplier or Ralcorp under any other federal or state law
in effect at the time relating to bankruptcy;
B. If Supplier or Ralcorp makes a general assignment for the benefit
of creditors;
C. If Supplier or Ralcorp admits in writing an inability to pay its
debts generally as they become due;
D. If Supplier or Ralcorp has appointed (voluntarily or involuntarily)
a trustee, receiver, custodian or agent under applicable law or under
contract, whose appointment or authority to take charge of property of
Supplier or Ralcorp for the purpose of general administration of such
property for the benefit of Supplier's or Ralcorp's creditors,
respectively; or
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E. If Supplier or Ralcorp commits a material breach of any of the
material terms or provisions of this Agreement and such breach is not
cured within thirty (30) days after written notice to the breaching
party advising of such breach.
SECTION 18 TERMINATION
A. In the event this Agreement expires or is terminated, Supplier
shall promptly provide Ralcorp with all Products and other Materials
owned or provided by Ralcorp which are in Supplier's possession.
B. In the event of the occurrence of any material breach not cured
within thirty (30) days of written notice of such breach, the
non-breaching party may terminate this Agreement effective immediately
upon written notice to the breaching party.
C. Upon termination of this Agreement for any reason Supplier shall
immediately stop the production of any Products then in process which
were to be supplied to Ralcorp and promptly deliver to Ralcorp all
Products manufactured hereunder along with all Specifications,
Technical Information belonging to Ralcorp, artwork, premiums, and
packaging materials purchased by Ralcorp and all other Materials and
supplies provided by Ralcorp. Ralcorp shall purchase from Supplier
reasonable quantities of any packaging materials and any other
Materials purchased by Supplier specifically for use with Products to
be produced for Ralcorp.
D. Upon any change of control of Supplier, Ralcorp may terminate this
Agreement effective immediately upon written notice to Supplier.
SECTION 19 RALCORP PRICING
Ralcorp shall independently determine its prices of the Products to its
customers.
SECTION 20 RIGHTS RESERVED TO RALCORP
Except to the extent otherwise provided herein, Ralcorp reserves to itself
the right to alter the flavors, formulas, ingredients, processing
conditions, labeling or packaging for the Products, provided that Supplier
may reasonably refuse to accept any alteration which adversely affects
Supplier's production of other products in the affected Plant(s).
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SECTION 21 ASSIGNMENT
Other than to a wholly owned subsidiary or to a wholly owned subsidiary of
its parent company, which shall agree to be bound by all the terms and
conditions hereof, neither party shall assign or otherwise transfer in any
manner its rights under this Agreement without the other's prior written
consent. No assignment of this Agreement will act to relieve the Assignor
from any of its duties or obligations hereunder.
SECTION 22 INTERPRETATIONS
The captions contained in this Agreement are for convenience and reference
only and do not define, limit, extend or describe the scope of this
Agreement or the intent of any provision thereof. This Agreement shall be
deemed to have been drafted by each party hereto.
SECTION 23 DISCRIMINATION
Supplier shall not discriminate, in violation of the applicable laws, in its
employment practices and shall comply with all applicable federal, state and
local laws, statutes, ordinances, rules, regulations and orders regarding
employee relations.
SECTION 24 ENTIRE AGREEMENT
This Agreement, including its attached exhibits and schedules specified
herein, together with the Trademark Agreement, the Technology Agreement, the
Reorganization Agreement and the Merger Agreement supersedes all prior or
contemporaneous written or oral agreements and understandings relating to
the subject matter hereof. This Agreement shall not be amended, altered, or
changed unless in writing signed by the parties hereto.
XXXXXXX 00 XXXXX XXXXXXX
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20
In the event that a party hereto shall be delayed, hindered in or prevented
from the performance of any act required hereunder by reason of strikes,
lock-outs, labor troubles, inability to procure Materials, failure of power,
riots, insurrection, war or other reasons of a like nature not the fault of,
or under the reasonable control of, the party delayed in performing work or
doing acts required hereunder (a "Casualty"), then performance of such
act(s) shall be excused for the period of the delay and the period for the
performance of any such act shall be extended for a period equal to the
period of such delay, provided such delayed party promptly gives written
notice to the other party of the occurrence giving rise to the delay and
upon cessation of the event causing the delay, promptly resumes performance
of its obligations hereunder.
SECTION 26 GOVERNING LAW
This Agreement shall be governed and construed in accordance with the laws
of the State of Missouri, including all matters of construction, validity,
enforcement and performance.
SECTION 27 INDEPENDENT CONTRACTOR
Supplier agrees that its services are provided as an independent contractor
and that individuals employed by Supplier shall not be deemed employees of
Ralcorp for any reason. Neither party shall have the authority to bind the
other party or to assume or create any obligation or responsibility, express
or implied, on behalf of the other party or in the other party's name.
SECTION 28 NOTICE
All notices, requests and other communications to any party hereunder shall
be in writing (including facsimile or similar writing) and shall be given:
If to Ralcorp, to: Ralcorp Holdings, Inc.
Number Xxx Xxxxxxx Xxxxx Xxxxxxxxx
Xxxxxxxxxxx, XX 00000
Attention: Xxxxx X. Xxxxxxxx
Facsimile: (000) 000-0000
Telephone: (000) 000-0000
If to Supplier, to: New Ralcorp Holdings, Inc.
000 Xxxxxx Xxxxxx, Xxxxx 0000
Xx. Xxxxx, Xxxxxxxx 00000
Attention: Xxxxxx X. Xxxxxxxxx
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Facsimile: (000) 000-0000
Telephone: (000) 000-0000
With additional copies as noted in the
Schedule(s).
or such other address or telex or facsimile number as such party may
hereafter specify by written notice to the other party.
SECTION 29 REGULATORY NOTICE
Each party agrees to notify the other immediately by telephone of any action
or inspection by any regulatory agency with respect to the Products covered
by this Agreement, or any of the raw materials or ingredients used to
manufacture Products covered by his Agreement, and shall confirm such notice
promptly in writing. Supplier shall promptly deliver to Ralcorp copies of
all reports pertaining to the Plants (to the extent relevant to Products
produced by Supplier for Ralcorp pursuant to this Agreement) or Products
resulting from an inspection of the Plant made by government organizations.
SECTION 30 SUCCESSORS AND ASSIGNS
Except as limited by the Assignment provisions hereof, this Agreement, its
terms and provisions shall be binding upon and inure to the benefit of the
parties hereto and their respective partners, legal representatives,
successors and assigns.
SECTION 31 WAIVER
Either party's failure to enforce any provision of this Agreement or to
require performance by the other party shall not be construed as a waiver of
such provision nor affect the validity of the Agreement or any part thereof,
or either party's right to enforce any provision thereafter.
SECTION 32 AUTHORIZATION; VALIDITY
The persons executing this Agreement on behalf of the Supplier and Ralcorp
each acknowledge that they are duly authorized to execute this Agreement on
behalf of and bind Supplier or Ralcorp, as the case may be, to the terms
hereof.
PART II.
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22
OTHER TRANSITION SERVICES
1. Services. Subject to the terms of this part of the Agreement, from and
after the Effective Date of this Agreement, Supplier shall make such Services
available to Ralcorp in accordance with Supplier's normal practice in providing
such services as of the Effective Date or as specifically set forth in Schedule
2 hereto (the "Services"). In consideration for the Services, Ralcorp shall
pay to Supplier an amount equal to the reasonable costs of Supplier (including,
but not limited to labor costs) in providing such Services and each Service
provided will be separately invoiced to Ralcorp. Ralcorp shall give Supplier
written notice of its intent to terminate any one or more of the Services at
least thirty (30) days prior to the termination of the Service. This Agreement
shall continue in full force and effect with respect to any Services not
terminated by any such notices.
2. Knowledge Transfer: Data Separation & Transfer. Supplier and Ralcorp
shall, through their respective information systems departments, work together
to the extent reasonably necessary to facilitate the transfer of knowledge and
data to Ralcorp in accordance with the terms of the Reorganization Agreement
and the Technology Agreement in order to eliminate the need for or to otherwise
discontinue as expeditiously as reasonably possible those Services performed in
accordance with this Agreement. To the extent such Services can reasonably be
eliminated upon the separation and transfer of data, the parties will work
toward executing such transfer immediately following the Closing. Ralcorp
shall pay to Supplier an amount equal to such reasonable costs for all hours
expended by Supplier personnel and actual charges incurred in separating and
converting and/or transferring data and in transferring knowledge associated
therewith.
3. Liability: Indemnification. Supplier shall have no liability to
Ralcorp with respect to its furnishing any of the Services hereunder except for
its willful misconduct or gross negligence. By agreeing to provide the
Services as an accommodation to Ralcorp, Supplier is making no representations
or warranties as to the quality, suitability or adequacy of the Services for
any purpose or use, except that Supplier will use such care in providing
services to Ralcorp as it would use in providing such services for its own use.
In providing the Services, Supplier shall not be obligated to (i) hire any
additional employees; (ii) maintain the employment of any specific employee;
(iii) purchase, lease or license any additional equipment or software; or (iv)
pay any costs related to the transfer or conversion of Ralcorp's data to
Ralcorp or any alternate supplier of administrative services. Except for
Supplier's gross negligence or willful misconduct, the sole remedy of Ralcorp
in the event data owned by it is lost or damaged in any way during processing
by Supplier is the refund to it of any charges paid for the processing of the
damaged data. Supplier agrees to exercise reasonable diligence to correct
errors or deficiencies in the Services. Except for Supplier's gross negligence
or willful misconduct, (i) Supplier shall not be liable to any third party in
any way for any obligation or commitment or for any act or omission in
connection with the provision of Services by Supplier and (ii) Ralcorp shall be
solely liable and responsible for any and all claims, liabilities, obligations,
losses, costs, expenses, litigation, proceedings, taxes, levies, imposts,
duties, deficiencies, assessments, charges, allegations, demands, damages or
judgments of any kind or nature whatsoever ("Liabilities")
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23
related to, arising from, asserted against or associated with Supplier
furnishing or failing to furnish to Ralcorp any of the Services described
herein. Upon the termination of any of the Services, Ralcorp shall be
obligated to return to Supplier, as soon as reasonably practicable, any
equipment or other property of Supplier relating to the Services which is owned
or leased by it and is or was in Ralcorp's possession or control and which was
or is not part of the assets to be transferred pursuant to the Merger Agreement
or the Reorganization Agreement. Effective as of the date of this Agreement,
Ralcorp shall indemnify and hold Supplier and its affiliates and their
respective directors, shareholders, officers, employees, agents, consultants,
representatives, successors, transferees and assigns harmless from and against
any and all Liabilities (including, without limitation, reasonable fees and
expenses of counsel) of whatever kind and nature related to, arising from,
asserted against or associated with Supplier's furnishing or failing to
furnish the Services provided for in this Agreement, other than Liabilities
arising out of the willful misconduct or gross negligence of Supplier or its
affiliates or their respective directors, shareholders, officers, employees,
agents, consultants, representatives, successors, transferees or assigns.
Nothing herein, however, shall be deemed to affect the right of Ralcorp to seek
damages or other rights of redress against Supplier for breach of the
provisions of this part of the Agreement.
4. Claims. Ralcorp's receipt of any Service performed hereunder shall be
an unqualified acceptance of, and a waiver by it of any and all claims with
respect to such Service unless Ralcorp gives Supplier notice of claim within
thirty (30) days after such receipt; no claim by Ralcorp against Supplier of
any kind, whether as to service performed or for delayed performance or
non-performance, unless such claim is based on gross negligence or willful
misconduct, shall be greater in amount than the fee for the Service in respect
of which such claim is made; and in no event will Supplier be liable to Ralcorp
for any incidental or consequential damages, whether or not caused by or
resulting from gross negligence or willful misconduct or breach of obligations
hereunder.
5. Additional Services. If Ralcorp wants Supplier to provide any service
other than the Services provided for in the Schedule 2, Ralcorp shall notify
Supplier, and within five (5) days following the giving of such notice,
Supplier shall provide such service if such service is reasonably necessary for
the conduct of the Branded Business (as defined in the Reorganization
Agreement) in the ordinary course. Ralcorp shall be invoiced for such services
in accordance with billing practices reasonably determined by Supplier. The
provision by Supplier of any such additional Services shall be subject to all
other provisions of this Agreement, as if those Services had originally been
part of the Schedule 2 to this Agreement.
6. Confidentiality. Any and all information which is not generally known
to the public which is exchanged between the parties in connection with this
Agreement, whether of a technical or business nature, shall be considered to be
confidential. The parties agree that confidential information shall not be
disclosed to any third party or parties without the written consent of the
other party, except to the extent otherwise addressed by the Technology
Agreement, which shall be treated in accordance with the terms of the
Technology Agreement.
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Each party shall take reasonable measures to protect against nondisclosure of
confidential information by its officers and employees. Confidential
information shall not include any information (i) which is or becomes part of
the public domain, (ii) which is obtained from third parties who are not bound
by confidentiality obligations, except to the extent otherwise addressed by the
Technology Agreement or (iii) which is required to be disclosed by law,
regulation, legal process or the rules of any state or federal regulatory
agency or the New York Stock Exchange. The provisions of this section shall
survive the termination of this Agreement.
7. Billing and Payment. Supplier shall xxxx Ralcorp on a monthly basis
for the amounts due to Supplier for services provided pursuant to the terms of
this Agreement. All such bills shall contain reasonable detail and shall be
due thirty (30) days after receipt. The failure of Ralcorp to pay any xxxx
within thirty (30) days of receipt shall result in Ralcorp owing Supplier an
additional handling charge equal to 1% per month of the amount due from the
date due to the payment date.
8. Term. It is intended that the Services be provided by Supplier as a
temporary accommodation to Ralcorp. Supplier shall provide the Services for a
period beginning at the commencement of the term of this Agreement. In no
event, however, shall Supplier be obligated to provide any Services identified
pursuant to Part II of this Agreement beyond ninety (90) days from the Closing
Date.
9. Other Provisions. Section 1 and Sections 21 through 32 of Part I of
this Agreement shall be incorporated by reference to this Part II. The
remaining terms of Part I shall in no way govern nor otherwise be applicable to
the services provided pursuant to this Part II.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first above written.
RALCORP HOLDINGS, INC. NEW RALCORP HOLDINGS, INC.
By By
----------------------- ----------------------
Title Title
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SCHEDULE 1
A. Supplier's Plant location for each Product to be produced (designate by
product): Battle Creek - RICE CHEX, Lancaster, Ohio - COOKIE CRISP,
Sparks, NV - COOKIE CRISP. The parties agree that Supplier's Plant
location at Sparks, NV shall be utilized for the production of COOKIE
CRISP only to the extent that Supplier's Plant location at Lancaster,
Ohio is unable to produce sufficient quantities of COOKIE CRISP in
accordance with the terms of this Agreement. Notwithstanding the
foregoing, Supplier shall have the right to utilize its Plant location at
Sparks, NV for the production of COOKIE CRISP notwithstanding the fact
that Supplier's Plant location at Lancaster, Ohio is able to produce
sufficient quantities of COOKIE CRISP if Supplier pays Ralcorp an amount
equal to the freight cost that would be incurred if such COOKIE CRISP
were shipped from Sparks, NV to Lancaster, Ohio.
The respective Products may not be manufactured or packaged at any other
location without Ralcorp's prior written consent.
B. "Products" - Products produced shall be as follows:
RICE CHEX 14/12 oz.
RICE CHEX 14/17.5 oz.
COOKIE CRISP 12/11 oz.
COOKIE CRISP 4/35 oz.
C. "Capacity Warranty". (a) Supplier hereby covenants that,
throughout the term of this Agreement, Supplier shall have the capacity
to produce 8,400 cwt. of RICE CHEX on a monthly basis (the "RICE CHEX
Production Commitment"). Notwithstanding the foregoing:
(i) Supplier shall have the right to reduce or terminate the RICE
CHEX Production Commitment (a "Supplier Termination") at any time
after the date that is one year after the commencement of the term
of this Agreement. Such termination shall become effective on the
date that is sixty (60) days after the first day of the month
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26
immediately following the month in which Supplier provides notice to
Ralcorp of such termination, which notice may be provided to Ralcorp
prior to the date that is one year after the commencement of the term
of this Agreement. Ralcorp and Supplier agree that any such
termination shall become effective not earlier than the date that is
one (1) year after the commencement of the term of this Agreement.
(ii) Ralcorp shall have the right to terminate the RICE CHEX
Production Commitment (a "Ralcorp Termination") at any time during
the term of this Agreement. Such termination shall become effective
on the date that is sixty (60) days after the first day of the month
immediately following the month in which Ralcorp provides notice to
Supplier of such termination. (The period commencing on the first
date of the term of this Agreement and ending upon the earlier of
the expiration of the term of this Agreement or any Supplier
Termination or Ralcorp Termination, shall be referred to herein as
the "RICE CHEX Commitment Period.")
(iii) In the event that the repair costs necessary to remedy the
effects of a Casualty upon the operations of Supplier's Plant
location at Battle Creek, Michigan exceed $250,000, Supplier shall
have the right to immediately terminate the RICE CHEX Production
Commitment (in which case the RICE CHEX Commitment Period will
similarly terminate) unless Ralcorp agrees, within 5 business days
after notification by Supplier of the amount of such repair costs,
to pay Supplier an amount equal to the excess of such repair costs
over $250,000.
(b) Supplier hereby covenants (the "COOKIE CRISP Production Commitment")
that, throughout the term of this Agreement, Supplier shall have the
capacity to produce 120,000 cwt. of COOKIE CRISP on an annual basis and
10,000 cwt of COOKIE CRISP on a monthly basis; provided, however, that
Supplier shall not be required to have the capacity to produce more than
15,000 cwt. of COOKIE CRISP in any 30-day period or more than 3,500 cwt.
in any 7-day period. Notwithstanding the foregoing, Ralcorp shall have
the right to terminate the COOKIE CRISP Production Commitment at any time
after the date that is fourteen (14) months after the commencement of the
term of this Agreement. Such termination shall become effective on the
date that is sixty (60) days after the first day of the month immediately
following the month in which Ralcorp provides notice to Supplier of such
termination, which notice may be provided to
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Supplier prior to the date that is fourteen (14) months after the
commencement of the term of this Agreement. Ralcorp and Supplier agree
that any such termination shall become effective not earlier than the
date that is fourteen (14) months after the commencement of the term of
this Agreement. (The period commencing on the first date of the term of
this Agreement and ending upon the earlier of the expiration of the term
of this Agreement or any termination of the COOKIE CRISP Production
Commitment by Ralcorp, shall be referred to herein as the "COOKIE CRISP
Commitment Period.")
D. Securing Materials, Coupons and Premiums. Ralcorp shall provide
all cartons and containers for RICE CHEX production and all COOKIE
CRISP production. A packaging shrink allowance of 4% will be allowed
during production runs at the Supplier with this shrink being
reconciled on an annual basis. Ralcorp will also supply the ingredient
"rice" for Rice Chex production. Supplier will provide all other
ingredients for the production of Rice Chex and all ingredients for
COOKIE CRISP pursuant to the payment terms as described in Section 11A.
Yield loss will be as outlined in Schedule 1E. Notwithstanding the
foregoing, each of Ralcorp and Supplier may provide such Materials for
RICE CHEX production and COOKIE CRISP production as the parties shall
mutually agree. In the event that Supplier exceeds the maximum yield
losses set forth in Schedule 1E with respect to Materials provided by
Ralcorp, Supplier shall pay to Ralcorp an amount equal to the cost of
such excess Materials utilized in connection with Supplier's exceeding
such maximum yield losses. Ralcorp shall provide and deliver to
Supplier all coupons and premiums Ralcorp wishes to include in RICE
CHEX or COOKIE CRISP. Any reasonable costs actually incurred by
Supplier in connection with any coupon or premium drops requested by
Ralcorp shall be paid by Ralcorp in accordance with terms as the
parties shall mutually agree, and the maximum allowed yield losses
relating to any such coupon or premium drops shall be determined in
accordance with terms as the parties shall mutually agree.
E. Loss of Yield. Supplier shall be allowed a maximum yield loss on
COOKIE CRISP of 30% and on RICE CHEX of 28%. Reconciliations of yield
loss costs will be done on an annual basis with the reconciliation
being done on the average yield loss for the 12 month period. Yield
losses will be calculated consistent with Supplier's current methods
from the CPST inventory accounting system.
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F. Storage and Disposal. Supplier shall provide suitable storage and
warehousing space and disposal services for Materials, and the parties
agree that the cost of such storage, warehousing and disposal are
reflected in the rates set forth in Section 11 of this Agreement;
provided, however, that Ralcorp shall pay Supplier an amount equal to
all reasonable costs actually incurred by Supplier in connection with
the storage, warehousing and disposal of Materials by Supplier which
storage, warehousing and disposal require the utilization of
facilities, services or other resources outside the normal course of
business of Supplier. Ralcorp shall promptly provide Supplier with
instructions with respect to the disposition of unusable Materials.
G. Schedule(s). Firm schedules specifying Supplier's requirements for
production, packaging, labeling and shipping of Products hereunder for
each Ralcorp fiscal month this Agreement is in effect shall be
delivered to Supplier by the tenth (10th) workday of the immediately
preceding Ralcorp fiscal month in which Ralcorp desires Supplier to
pack and ship such Products along with a tentative schedule for the
immediately succeeding two (2) fiscal months. The firm schedule(s) may
only be modified as mutually agreed, provided, however, that the
tentative schedule may be modified by Ralcorp for any reason without
Ralcorp incurring any obligation to Supplier therefor.
H. Shipping Instructions. Supplier shall comply with Ralcorp's written
shipping instructions. All Products shall be shipped, with advance approval of
Ralcorp, in vehicles suitable for transportation of food and otherwise in
compliance with all Laws including, without limitation, Department of
Transportation regulations. It is understood that warehouse space for finished
product is not to be supplied by the Supplier; provided, however, that Supplier
shall provide normal loading and on-site holding services during standard
operating time periods with respect to Products to be shipped in accordance
with the terms of this Agreement.
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SCHEDULE 2
Data Processing
- Sales
- Order Processing
- Invoicing
- Accounts Receivable
- Associated General Ledger
- Cincinnati Plant
- Payroll
- Inventory
- Raw Material
- Finished Product
- Maintenance Storeroom
- Disbursements
- Fixed Assets
- Process Control
- Quality Control
- Associated General Ledger
Finished Product Distribution
- Finished Product Storage and Handling
Services Related to Raw Material Supply
- Commodities
- Other Raw Materials
- Packaging Materials
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