Register for free to join our community of investors and share your ideas. You will also get access to streaming quotes, interactive charts, trades, portfolio, live options flow and more tools.
Giff things always look darkest before the dawn. The picture is grim, but as we see it. We have noooo idea what the real picture is, sure it could be worse, but I would bet that this, as almost always the case is an overexaggerated downward move, primarily due to lack of facts. What we do extrapolate is negative but the markets always act like elastic bands, overreact then get facts and correct and level off. We have seem a bottom form, but no correction. So it would not be too shocking imo to see it move north a bit, and stay put waiting for the next info.
Yeh.. they are so generous.. LOL
last 10Q..."will need to greatly increase our present production volume before the measuring period from September 1, 2009 to August 31, 2010 in order to avoid a substantial shortfall payment"... "estimated short-fall payment could exceed $6,400,000."
I guess I still don't understand why any company would word a contract as such? It seems they could have easily said that they would buy 100% of all product... and they have the exit payment stuff... They had to have been backed into a corner by this supplier! Now you know, when you buy Schreibe products, what kind of company Schreiber is...
What they should do is buy up all the other soy cheese companies... They could budget $6.4 mil for the purchases and maybe get something out of this blunder.
November 3, 2006
David Lipka
19 Oakwood Circle
Roslyn, NY 11576
Dear David:
Please accept the following modifications to the Supply Agreement between Galaxy
Nutritional Foods and Schreiber Foods, Inc., dated June 30, 2005.
Current: The Supply Agreement has a volume penalty clause for volume below a
certain level. The timeframe for the measurement of volume is the second year of
the contract with the opportunity to recover any loss volume in year three
without penalty.
Modification: The timeframe for measurement of volume will be the fifth year of
the Supply Agreement.
Current: The Supply Agreement sets the base level for the volume commitment at
*** pounds. This amount includes blocks to be further processed as well as all
product produced for immediate sale.
Modification: The base level will be reduced by the volume of blocks to be
further processed (*** pounds). Thus, the base level will be set at *** pounds
(*** minus *** pounds).
David, I recognize that there are circumstances which have caused the volume to
be below our respective expectations. I hope that these modifications provide
you relief from the financial burden of this reduced volume. We remain hopeful
that with your new marketing strategy volume can grow to the previously expected
level.
We are committed to the success of Galaxy and to continuing to strengthen the
partnership between Galaxy Nutritional Foods and Schreiber Foods, Inc.
Best regards,
/s/ Ronald J. Dunford
Ronald J. Dunford
President & COO
Schreiber Operations
Acknowledged and agreed to this 9th day of November, 2006
/s/ David H. Lipka
David H. Lipka
Chairman
Galaxy Nutritional Foods, Inc.
*** Indicates material omitted pursuant to a confidential treatment request
and filed separately with the Securities and Exchange Commission.
B. "Change of Control" means a sale of such Party's business (whether by sale of a majority of its capital stock, all or substantially all of its assets, merger, or otherwise), excluding, for purposes hereof, the transactions contemplated by the Purchase Agreement.
3. The amounts of the Shortfall Payment and the Catch-up Payment shall each be reduced by *** if a Change of Control of either Party occurs prior to the date that any amount becomes due and payable pursuant to Section III.C(2).
WHat is the ***??
Hey Wall Street... Did you get a chance to determine what the heck that supply agreements all about? TIA
SUPPLY AGREEMENT
THIS SUPPLY AGREEMENT (the "Agreement") is made effective this 30th day of
June, 2005, by and between GALAXY NUTRITIONAL FOODS, INC., a corporation
organized and existing under the laws of the State of Delaware (hereinafter
referred to as "Galaxy"), and SCHREIBER FOODS, INC., a Wisconsin corporation
(hereinafter referred to as "SFI"). SFI and Galaxy may be referred to
individually as a "Party" or collectively as the "Parties".
RECITALS:
WHEREAS, the Parties have entered into that certain Asset Purchase
Agreement, dated as of the date hereof (the "Purchase Agreement"), pursuant to
which SFI shall acquire from Galaxy certain assets used in connection with the
manufacture and sale of imitation cheese and related food products; and
WHEREAS, Galaxy has agreed to market and promote to its customers the
Products (as defined below), and SFI has agreed to manufacture and sell Products
to Galaxy and to deliver Products to Galaxy's customers under the terms and
conditions set forth in this Agreement; and
WHEREAS, Galaxy shall deliver purchase orders for Products to SFI, which
purchase orders shall include "ship to" information, and SFI shall fill such
purchase orders, all under the terms and conditions set forth in this Agreement.
NOW THEREFORE, in consideration of the above recitals, and the mutual
promises, covenants, terms and conditions set forth herein, the Parties agree as
follows:
I. DEFINITIONS. Unless expressly provided otherwise, the terms in this
Agreement shall have the meanings set forth below:
A. "Affiliates" of a Person shall mean (i) with respect to an entity,
any officer, director, stockholder, partner, member or investor in
such entity or of or in any affiliate of such entity; and (ii) with
respect to a Person or entity, any Person or entity which directly
or indirectly Controls, is Controlled by, or is under common Control
with such Person or entity.
B. "Change of Control" means a sale of such Party's business (whether
by sale of a majority of its capital stock, all or substantially all
of its assets, merger, or otherwise), excluding, for purposes
hereof, the transactions contemplated by the Purchase Agreement.
C. "Control" (including the terms "Controlled by" and "under common
Control with") means the possession, directly or indirectly, or as
trustee or executor, of the power to direct or cause the direction
of the management policies of a Person, whether through the
ownership of stock, as trustee or executor, by contract or credit
arrangement or otherwise
D. "Effective Date" means September 1, 2005.
*** Indicates material omitted pursuant to a confidential treatment request
and filed separately with the Securities and Exchange Commission.
<PAGE>
E. "Event of Default" shall be as defined in Section VII(B) below.
F. "Force Majeure" shall mean a (i) fire, (ii) flood, (iii) storm, (iv)
strike, lockout, or other labor trouble, excluding, however, any
strike, lockout or other labor trouble that is initiated within or
limited to the labor force of the affected party, (v) riot, (vi)
war, (vii) terrorism, (viii) rebellion, or (ix) act of God.
G. "Galaxy Inventory" means all of the following owned by Galaxy on the
Effective Date and dedicated to alternative cheese products
production at the Facility: merchantable and saleable (i) raw
materials, (ii) ingredients (e.g., spices and seasonings), and (iii)
operating supplies and packaging supplies.
H. "Intellectual Property" means all rights held by Galaxy in the
Products and in its Confidential Information (as defined in Section
XII) and other intellectual property owned by Galaxy, including,
without limitation, patents, copyrights, author's rights,
trademarks, tradenames, know-how, trade secrets, recipes, food
preparation methods and production techniques, irrespective of
whether such rights arise under U.S. or international intellectual
property, unfair competition or trade secret laws or otherwise.
I. "Non-Material Product" means any Product or Products which,
individually or in the aggregate, do not represent a material amount
of Galaxy's aggregate production as of the date hereof; provided,
however, that any Product that is categorized under the Slices or
Shreds Product Lines shall not be a Non-Material Product.
J. "Product" or "Products" refers to and is limited to those items
manufactured pursuant to this Agreement and that are more fully
described on attached Exhibit A, as modified from time to time by
written agreement signed by SFI and Galaxy.
K. "Product Line" means the grouping of the Products into each of the
following classes: (i) Slices; (ii) Shreds; (iii) Block, (iv) Soft
Cheese, (v) Grated Parmesan and (vi) Chunk, all as initially
reflected on attached Exhibit A.
L. "Specifications" refers to and includes the Product specifications,
quality standards and requirements presently in effect with respect
to the Products and as determined mutually by the Parties in writing
from time to time.
M. "Standard Costing Protocol" means, with respect to ingredients,
packaging and raw materials, SFI's actual costs from ordinary
purchasing activities.
N. "Term" shall be as set forth in Section III.
2
<PAGE>
II. SUPPLY OF PRODUCTS.
A. Existing Products; Transition. Subject to the provisions set forth
herein, Galaxy agrees that (i) as of the Effective Date, SFI shall
be the sole third-party source of supply of the Products for the
Term of this Agreement, (ii) as of November 1, 2005, SFI shall be
the sole source of supply of the Products for the Term of this
Agreement, and (iii) that Galaxy shall purchase its requirements of
Products exclusively from SFI, and SFI hereby agrees to sell to
Galaxy, all of its requirements of Products. The Parties agree to
meet on a quarterly basis, at a time and place mutually agreeable to
both Parties, to forecast the estimated quantities of Products
required by Galaxy and its customers by Product Line, for the next
two quarters. SFI and Galaxy will agree to a specific timetable to
efficiently transition the manufacturing of the Products to SFI's
facilities, and will implement such transition so that the
manufacturing of the Products is transitioned to SFI's facilities
prior to the Effective Date. If, prior to the Effective Date, SFI
notifies Galaxy in writing that it is unable to produce any
Non-Material Product in accordance with the Specifications or
otherwise in compliance with SFI's representations, warranties,
guaranties, covenants or other obligations under Section IV hereof,
then such Product shall not be a Product under this Agreement.
B. Future Products.
1. Same Product Line. In the event Galaxy develops any item
within any of the Product Lines which is not then a Product
under this Agreement and Galaxy elects to market such item,
such item shall be a Product under this Agreement, unless SFI
is unable to manufacture such item with the equipment and
technology SFI then has in accordance with Galaxy's
specifications with respect thereto. The parties agree to
price any such items consistent with the pricing described for
Products on Exhibit B.
2. Different Product Line. In the event Galaxy develops any
cheese or cheese alternative item that is not within any of
the Product Lines and Galaxy elects to market such item, such
item shall be a Product under this Agreement, unless SFI is
unable to manufacture such item with the equipment and
technology SFI then has in accordance with Galaxy's
specifications with respect thereto. The parties agree to
price any such items in a manner that is as consistent with
the pricing described for Products on Exhibit B as is
practicable, provided, however, that if the proposed price
exceeds the price at which Galaxy can obtain such item (either
on its own or through another private labeling source) by ***,
then Galaxy may select such alternative with respect to such
item and such item will not be a Product under this Agreement.
3
<PAGE>
C. List of Suppliers. On or prior to the Effective Date, Galaxy shall
furnish a list of Galaxy's top ten suppliers and vendors of raw
materials, products and services for Galaxy's operations, with a
listing of the approximate total amount of purchases made from each
during the period from January 1, 2004 through May 31, 2005;
provided, however, that Galaxy shall not be required to furnish any
such information to SFI to the extent that the same would result in
a breach of any confidentiality obligations applicable to such
information.
III. TERM AND PRICE.
A. Term. The "Term" of this Agreement shall be for a period of five (5)
years from the Effective Date of this Agreement (the "Initial Term")
plus, at Galaxy's option by written notice to SFI at least 180 days
prior to the end of the then current Term (the "Notice Date"), up to
two additional consecutive five (5) year terms; provided, however,
that (i) if the Closing (as defined in the Purchase Agreement) has
occurred and Galaxy does not exercise its option to extend the Term
for the first additional five year period, then Galaxy shall pay SFI
$1,500,000 at the expiration of the then current Term, and (ii) if
the Closing (as defined in the Purchase Agreement) has occurred and
Galaxy has exercised its option with respect to the first additional
five year period, but does not exercise its right to extend the Term
for the second additional five year period, then Galaxy shall pay
SFI $750,000 upon the expiration of the then current Term (each such
payment, a "Termination Payment").
B. Price. The price for Products during the Initial Term shall be as
determined in accordance with the attached Exhibit B. Prior to the
Notice Date, Galaxy and SFI shall, in good faith, consider
adjustments to the "conversion" component with respect to each
Product Line to reflect any changes in SFI's actual cost of
conversion with respect to each Product Line for the next five year
Term; provided, however, that the conversion costs with respect to
any Product Line shall not be increased or decreased as a result of
this Section III.B by more than *** of the conversion costs in
effect for the then applicable Term. The Parties shall provide each
other with necessary and appropriate information and documentation
to provide a basis with which to determine such adjustment. In the
event that the Parties are unable to agree to the amount of any such
adjustment, then the adjustment amount proposed by SFI in good faith
shall apply.
C. Special Payments.
1. If, during the one-year period beginning on the first
anniversary of the Effective Date and ending on the second
anniversary of the Effective Date, SFI's actual shipments of
Products under this Agreement are less than ***, then Galaxy
shall pay SFI an amount determined as follows (the "Shortfall
Payment"):
4
<PAGE>
***;
where X represents the number of pounds shipped by SFI during
such one-year period. Such Shortfall Payment shall be payable
in accordance with Section III.C(2) below.
2. If Galaxy was obligated to make a Shortfall Payment pursuant
to Section III.C(1) above, and during the one-year period
beginning on the second anniversary of the Effective Date and
ending on the third anniversary of the Effective Date, SFI's
actual shipments of Products under this Agreement exceed ***,
then SFI shall pay Galaxy an amount determined as follows (the
"Catch-up Payment"):
***;
where X represents the number of pounds shipped by SFI during
such one-year period; provided that the amount of such
Catch-up Payment shall not exceed the amount of such Shortfall
Payment. Within 30 days of the date that the amount of such
Catch-up Payment is determined by the Parties, Galaxy shall
pay SFI an amount equal to the Shortfall Payment minus the
Catch-up Payment. Notwithstanding anything in this Section
III.C to the contrary, Galaxy shall not be required to make
any Shortfall Payment if (i) SFI has breached any of its
representations, warranties, guaranties or covenants hereunder
in any material respect, (ii) at any time during such
applicable two-year period SFI's obligations hereunder have
been suspended or otherwise reduced pursuant to Section XIII
(Force Majeure), or (iii) if the Closing (as defined in the
Purchase Agreement) has not occurred.
3. The amounts of the Shortfall Payment and the Catch-up Payment
shall each be reduced by *** if a Change of Control of either
Party occurs prior to the date that any amount becomes due and
payable pursuant to Section III.C(2).
D. Sale of Galaxy Inventory to SFI.
1. On October 31, 2005, SFI and Galaxy shall mutually conduct a
physical inventory of the Galaxy Inventory and shall prepare a
schedule setting forth the description of each category of
Galaxy Inventory together with the quantity of each such
category (the "Galaxy Inventory Count Schedule"). Such
physical count shall be conducted and the Galaxy Inventory
Count Schedule shall be prepared, pursuant to the procedures
and principles set forth in Schedule III.D(1) attached hereto.
Galaxy's actual out-of-pocket costs to purchase such Galaxy
Inventory (the "Inventory Cost") shall be set forth in the
Galaxy Inventory Count Schedule.
5
<PAGE>
2. On November 1, 2005, Galaxy shall ship the Galaxy Inventory to
SFI, and SFI shall pay Galaxy the Inventory Cost, by wire
transfer in immediately available funds.
3. At any time prior to November 1, 2005, SFI may request that
Galaxy ship any Galaxy Inventory that Galaxy has in inventory
and that is no longer being used in production by Galaxy,
provided that SFI shall use such Galaxy Inventory only in the
manufacture of Products produced by SFI under this Agreement.
The purchase price for such Galaxy Inventory shall be equal to
Galaxy's actual out-of-pocket costs to purchase such Galaxy
Inventory.
4. If this Agreement is terminated prior to SFI's use of all such
Galaxy Inventory, then SFI shall return such excess Galaxy
Inventory and Galaxy shall pay SFI the Inventory Cost
attributable to such returned Galaxy Inventory.
IV. QUALITY OF PRODUCTS.
A. Warranty of Quality. SFI warrants, represents and covenants that, at
the time of delivery by SFI to Galaxy or its customers, all Products
supplied by SFI to Galaxy or to Galaxy's customers pursuant to this
Agreement shall comply with the Specifications and all state and
federal laws, rules, and regulations, as applicable to Products.
Further, SFI guarantees, as of the time of such delivery to Galaxy
or its customers, that the Products will not be adulterated or
misbranded within the meaning of the Federal Food, Drug and Cosmetic
Act (the "Act").
B. Rights to Inspect Facilities and Products. Upon reasonable prior
notice by Galaxy to SFI, Galaxy shall have the right to inspect,
during regular business hours, that portion of any SFI facility that
manufactures or stores Products (or inventory related thereto)
pursuant to this Agreement. Upon Galaxy's request, SFI shall make
available various production samples of the Products for the purpose
of permitting Galaxy to confirm that SFI is producing the Products
in accordance with the Specifications. Nothing contained herein
shall obviate, limit, or otherwise relieve SFI from complying with,
its obligations, representations, warranties, covenants and
guaranties set forth herein, and all obligations, representations,
warranties, covenants and guaranties shall survive any monitoring
and inspection by or on behalf of Galaxy. Galaxy will sign the
standard confidentiality agreement (in the form attached hereto as
Exhibit C) prior to the inspection of any of SFI's facilities
pursuant to this Section IV.B.
6
<PAGE>
C. Product Guarantee and Return Procedure. All Products manufactured or
packaged by SFI are guaranteed from the date of packaging until the
expiration date on the package to be free from defects. SFI shall
give credits pursuant to this Product guarantee upon receipt of
notice from Galaxy or Galaxy's customers that such Product did not
conform with the guarantee. To the extent that Galaxy receives any
returned Product from its customers, Galaxy shall return the same to
SFI. Notwithstanding the foregoing, SFI shall not be responsible to
replace or reimburse Galaxy for Products to the extent that the
unacceptability of such Products resulted from the negligence or
misconduct of Galaxy (and/or its customers) in the handling or
storage of the Products. All Products returned to SFI, and all
Products Galaxy receives credit for, regardless of reasons or
credits sought, must be preceded by a communication which includes
the Product identification, number of cases or weight involved,
reason for the return, anticipated return date and the method of
return; provided, however, that neither Galaxy nor its customers
shall be obligated to return any Product in order to receive such
credit if such Product was destroyed pursuant to any applicable law,
rule or regulation. Without prior agreement to the contrary, SFI
must approve (which approval will not be unreasonably delayed or
withheld) all return Product transport arrangements or the cost of
such transportation shall be borne by Galaxy.
D. Labels and Packaging. All Products shall be packaged by SFI into
appropriate packaging containing all label information identifying
the Products as Galaxy branded products and ready for resale by
Galaxy to its customers, all in accordance with the Specifications.
Galaxy may, from time to time, make modifications to the packaging
and the corresponding Specifications, provided that (i) Galaxy will
pay for any increase in packaging costs as a result thereof and (ii)
such modified packaging runs properly on SFI's equipment.
V. DELIVERY OF PRODUCTS; TITLE & RISK OF LOSS.
A. Product Order & Delivery. At such time as Galaxy desires Product for
any of its customers, Galaxy shall submit a purchase order to SFI by
mail, facsimile, or e-mail which sets forth the type and quantity of
Products required, the delivery date and the "ship to" information.
All Products shall be delivered F.O.B. destination. SFI agrees to
ship all orders for Product within ten (10) business days of the
effective date of such order. The Parties agree that the effective
date for orders of Product shall be one (1) business day following
the date SFI receives such purchase order. No purchase order or
confirmation with respect thereto shall conflict with or supplement
the terms or conditions of this Agreement unless SFI and Galaxy
shall have specifically agreed in writing to any condition, term or
agreement contained herein.
7
<PAGE>
B. Title. Title to all Products SFI provides pursuant to this Agreement
shall pass to Galaxy (or Galaxy's customer, as the case may be) upon
completion of delivery of the Products to the destination designated
by Galaxy. Should Galaxy's customer reject tender or revoke its
acceptance of any Products, title to such Products shall pass to SFI
at such time as the Products are loaded for delivery to SFI, F.O.B.
at such customer's facility.
VI. PAYMENT. SFI shall invoice Galaxy for all Products sold and delivered
under this Agreement on date of shipment, at the price established in
Section III, above. For all invoices received on or prior to the first
anniversary of the Effective Date, Galaxy shall pay such invoices by
electronic funds transfer on or before the twentieth (20th) day after
receipt of such invoice. For all invoices received after the first
anniversary of the Effective Date, Galaxy shall pay such invoices by
electronic funds transfer on or before the fifteenth (15th) day after
receipt of such invoice.
VII. TERM; TERMINATION; EVENT OF DEFAULT.
A. Term. This Agreement shall be for the Term.
B. Event of Default. Either Party may, in addition to other remedies
available at law or equity, at any time during the continuation of
an Event of Default terminate this Agreement upon written notice to
the other if any of the following events occur (the occurrence of
which is referred to as an "Event of Default"):
1. Material Breach. The other Party breaches a material
obligation under this Agreement, other than a payment
obligation which is the subject of Section VII(B)(3) below,
and, if susceptible to cure, such breach continues without
cure for a period of fifteen (15) days after written notice
thereof; provided, however, if the breach is susceptible to
cure but is not one which is capable of being cured within
such 15 day period and the breaching Party has substantially
commenced to cure the breach within such time and continues to
do so diligently and in good faith, then the breaching Party
shall be granted an extension for a reasonable period of time,
not to exceed 45 days (including the initial fifteen (15)
days) in any event.
2. Cessation of Business. The other Party ceases to conduct
business in the normal course, becomes insolvent, enters into
suspension of payments, moratorium, reorganization or
bankruptcy, makes a general assignment for the benefit of
creditors, admits its inability to pay debts as they mature,
suffers or permits the appointment of a receiver for its
business or assets, or avails itself of or becomes subject
(for more than 60 days if not voluntary) to any other judicial
or administrative proceeding that relates to its insolvency or
to the protection of the rights of its creditors.
8
<PAGE>
3. Failure to Pay Amounts Due. Galaxy fails to pay any amount due
hereunder, which failure is not remedied within fifteen (15)
days following receipt by Galaxy of a written demand for
payment by SFI unless such payment is being withheld by Galaxy
in good faith in connection with a bona fide dispute between
SFI and Galaxy relating to a specific shipment(s) of Product,
with such withholding to only apply to the specific
shipment(s) of Product to which Galaxy has asserted a dispute
with reasonable particularity.
C. Early Termination.
1. Galaxy shall use its reasonable efforts to submit to, and
obtain the approval of, its stockholders a vote for the
purpose of approving the transactions contemplated by the
Purchase Agreement at or prior to the next annual meeting of
its stockholders. If Galaxy's stockholders fail to approve
such transactions at the meeting held for such purpose, then
Galaxy may terminate this Agreement by providing written
notice thereof to SFI within 30 days of the date of such
stockholder meeting, which notice shall state an effective
date for such termination that shall not be more than 180 days
after the date of such notice.
2. If Galaxy's stockholders fail to approve the transactions
contemplated by the Purchase Agreement at the meeting held for
such purpose, and Galaxy and SFI are unable to consummate an
Alternative Transaction as contemplated by the Purchase
Agreement prior to January 1, 2006, then SFI may terminate
this Agreement by providing written notice thereof to Galaxy
prior to February 1, 2006, which notice shall state an
effective date for such termination which date shall not be
less than 180 days after the date of such notice; provided,
however, that Galaxy may shorten such period by written notice
to SFI.
D. Survival. The following provisions shall survive any termination or
expiration of this Agreement: Section IV, Section VIII, Section X,
Section XII, Section XIV and Section XXVII.
VIII. INDEMNIFICATION; INSURANCE AND REMEDIES.
A. Indemnification of Galaxy. SFI agrees to protect, defend, indemnify
and hold Galaxy, its customers and Affiliates and their officers,
directors, shareholders, agents and employees (all of which shall be
included within any reference to Galaxy in this Section VIII)
harmless from and against any and all causes of action, suits,
losses, liabilities, claims, demands,
9
<PAGE>
judgments, penalties, fines, proceedings, costs, expenses (including
reasonable attorney's fees and costs as they are incurred), and
damages and whether based upon law or equity, contract or tort, or
whether judicial or administrative in nature, and whether based upon
bodily injury, property damage or otherwise, related to or arising
out of or in any manner connected with any breach of guaranty,
warranty, representations, duty, covenant or obligation assumed or
to be performed by SFI herein, or any claims, actions or suits
brought by any person or entity against Galaxy for the recovery of
damages for the injury, emotional distress, illness and/or death of
any person or damage to property arising out of the purchase,
consumption or exposure to Product manufactured by SFI under this
Agreement.
The foregoing shall be collectively referred to as "Claims
Indemnified by SFI".
SFI shall, at its own expense and with counsel reasonably acceptable
to Galaxy, defend any Claim Indemnified by SFI that is the subject
of this duty of indemnity and SFI shall pay all reasonable
attorney's fees, costs and other expenses (including expenses of
investigation and witnesses as they are incurred) arising therefrom.
Galaxy agrees to provide SFI with prompt notice following receipt of
notice of any claim, legal proceeding or other action against Galaxy
that is the subject of this indemnification but any failure to do so
will not reduce or otherwise affect SFI's indemnification
obligations except to the extent SFI is materially prejudiced
thereby. In the event Galaxy tenders the defense of a Claim
Indemnified by SFI to SFI and SFI agrees in writing that such Claim
is a Claim Indemnified by SFI, then SFI shall have sole and
exclusive control over the defense and Galaxy agrees to cooperate
and/or provide such information or documents as may be necessary to
defend the Claim; provided, however, that Galaxy will have the sole
and exclusive right, but not the obligation, to control the defense,
at SFI's expense, if either (i) SFI fails to timely defend, contest
or otherwise protect against any such Claim Indemnified by SFI, or
(ii) Galaxy's attorneys conclude that the interests of SFI are in
conflict with the interests of Galaxy with respect to such Claim
Indemnified by SFI. Nothing in this Section shall prevent Galaxy
from retaining, at its own expense, separate counsel to participate
in the defense of such Claim. SFI agrees that it will not settle,
consent to the entry of any judgment, or otherwise compromise any
Claim without obtaining the prior written consent of Galaxy, which
Galaxy agrees it shall not unreasonably withhold or delay. In no
event shall consent be needed from Galaxy for any exclusively
monetary settlement not involving the payment of money by Galaxy or
any of its Affiliates, provided, however, that such settlement (i)
shall not include any admission of wrong doing by or on behalf of
Galaxy and (ii) shall contain an unconditional release in favor of
Galaxy with respect to such Claim. Galaxy shall not be required to
consent to any settlement involving the imposition of equitable
remedies on Galaxy or any of its Affiliates or the imposition of any
other obligation on it other than financial obligations for which
Galaxy will be indemnified hereunder.
10
<PAGE>
B. Indemnification of SFI. Galaxy agrees to protect, defend, indemnify
and hold SFI and its Affiliates, officers, directors, shareholders,
agents and employees (all of which shall be included within any
reference to SFI in this paragraph), harmless from and against any
and all causes of action, suits, losses, liabilities, claims,
demands, judgments, penalties, fines, proceedings, costs, expenses
(including reasonable attorney's fees and costs), and damages and
whether based upon law or equity, contract or tort, or whether
judicial or administrative in nature, and whether based upon bodily
injury, property damage or otherwise, related to or arising out of
or in any manner connected with the mishandling of Product or breach
of any duty, covenant, representation, warranty or obligation
assumed or to be performed by Galaxy under the terms of this
Agreement. The foregoing shall be collectively referred to as
"Galaxy Indemnified Claims."
Galaxy shall, at its own expense and with counsel reasonably
acceptable to SFI, defend any Galaxy Indemnified Claim that is not
subject to indemnification under Section VIII(A) and Galaxy shall
pay all reasonable attorneys' fees, costs and other expenses arising
therefrom. SFI agrees to provide Galaxy with prompt notice following
receipt of notice of any legal proceeding or other action against
SFI that is the subject of this indemnification, but any failure to
do so will not reduce or otherwise affect Galaxy's indemnification
obligations except to the extent Galaxy is materially prejudiced
thereby. In the event SFI tenders the defense of a Galaxy
Indemnified Claim to Galaxy and Galaxy agrees in writing that such
Claim is a Galaxy Indemnified Claim, Galaxy shall have sole and
exclusive control over the defense and SFI agrees to cooperate
and/or provide such information or documents as may be necessary to
defend the Galaxy Indemnified Claim; provided, however, that SFI
will have the sole and exclusive right, but not the obligation, to
control the defense, at Galaxy's expense, if either (i) Galaxy fails
to timely defend, contest or otherwise protect against any such
Galaxy Indemnified Claim, or (ii) SFI's attorneys conclude that the
interests of Galaxy are in conflict with the interests of SFI with
respect to such Galaxy Indemnified Claim. Nothing in this Section
shall prevent SFI from retaining, at its own expense, separate
counsel to participate in the defense of such Galaxy Indemnified
Claim. Galaxy agrees that it will not settle, consent to the entry
of any judgment, or otherwise compromise any Galaxy Indemnified
Claim without obtaining the prior written consent of SFI, which SFI
agrees it shall not unreasonably withhold. In no event shall consent
be needed from SFI for any exclusively monetary settlement not
involving the payment of money by SFI, provided, however, that such
settlement (i) shall not include any admission of wrong doing by or
on behalf of SFI and (ii) shall contain an unconditional release in
favor of SFI with respect to such Claim. SFI shall not be required
to consent to any settlement involving the imposition of equitable
remedies on SFI or the imposition of any other obligation on it
other than financial obligations for which SFI will be indemnified
hereunder.
11
<PAGE>
C. Right to Contribution. Notwithstanding anything in this Agreement to
the contrary, SFI (and/or its insurers) shall have the right to
pursue a claim for contribution or indemnity against Galaxy to the
extent of the proportion of damages found to be attributable to
Galaxy's negligence for any Claim Indemnified by SFI following a
judicial determination and exhaustion of all appeals.
Notwithstanding anything in this Agreement to the contrary, Galaxy
(and/or its insurers) shall have the right to pursue a claim for
contribution or indemnity against SFI to the extent of the
proportion of damages found to be attributable to SFI's negligence
for any Galaxy Indemnified Claim following a judicial determination
and exhaustion of all appeals.
D. Insurance. Each Party agrees that it will obtain and maintain in
force during the Term and for one (1) year thereafter, with insurers
reasonably acceptable to the other Party, comprehensive general
liability insurance coverage, providing usual and customary
coverages of such insurance and including product
liability/completed operations, contractual liabilities and vendors
coverage, in coverage amounts of not less than (i) $10,000,000.00
each occurrence and $20,000,000.00 general aggregate in the case of
SFI, and (ii) $3,000,000 each occurrence and $5,000,000 general
aggregate in the case of Galaxy, in each case subject to any
customary deductibles or self-insurance amounts.
E. Remedies. The remedies of the Parties as set forth in this Agreement
are cumulative.
F. Survival. Notwithstanding anything contained herein to the contrary,
the rights and obligations of the parties under this Section VIII
shall survive the termination or cancellation of this Agreement for
any reason whatsoever.
IX. COVENANT NOT TO MANUFACTURE PRODUCTS.
A. Covenant. Galaxy covenants and agrees that during the Term, it will
not, whether directly or indirectly, and whether as owner, manager,
operator, consultant, contractor or otherwise, manufacture the
Products in the United States to or for the benefit of itself or for
the benefit of any other person or entity other than SFI.
B. Remedies. Galaxy recognizes that irreparable injury may result to
SFI in the event of a breach by Galaxy of any of the covenants
contained in this Section IX and acknowledges that Galaxy's
agreement to be bound by the provisions of this Section IX is a
significant reason for SFI's decision to enter into this Agreement
and the Purchase Agreement. In the event that Galaxy shall engage in
any act or behavior in violation of these covenants, Galaxy agrees
that SFI shall be entitled, in addition to such other remedies and
12
<PAGE>
damages as may be available to it by law or under this Agreement, to
preliminary and/or permanent injunctive relief, without the
necessity of posting a bond, prohibiting Galaxy from engaging in
such act or behavior; provided, however, that if any court of record
shall finally adjudicate that the involved restraint, as provided
herein, is too broad as to the area or time covered, Galaxy agrees
that said area or time may be reduced to whatever extent the court
deems reasonable and the restraint may be enforced as to such
reduced area or time. The provisions of this paragraph shall survive
the termination of this Agreement.
X. LICENSE; COVENANT NOT TO MANUFACTURE PRODUCTS.
A. License; Intellectual Property. During the Term, Galaxy grants SFI a
non-exclusive, nontransferable, royalty-free license, without right
to sub-license, to use Galaxy's Intellectual Property (i) that is
necessary for manufacturing, assembling and distributing Products
for Galaxy pursuant to this Agreement and (ii) for the sole purpose
of manufacturing, assembling and distributing Products for Galaxy
pursuant to this Agreement. Galaxy shall retain sole ownership of,
and all rights to, all Intellectual Property. SFI covenants to
refrain from, and to use commercially reasonable efforts to prevent
any disclosure of any part or aspect of said Intellectual Property
to any other person in any manner which could impair its secrecy and
confidentiality, and the commercial value of said Intellectual
Property. Without restricting the generality of the foregoing, SFI
shall:
1. limit any disclosure of said Intellectual Property to only
those of its employees and or consultants who have an actual
need to know such Intellectual Property in the performance of
their duties in connection with this Agreement and who have
executed a secrecy agreement that covers such Intellectual
Property. SFI shall promptly inform Galaxy of any breach of
such secrecy agreement of which it becomes aware.
2. keep all data and records concerning said Intellectual
Property secure against access by unauthorized personnel or
third persons.
3. return to Galaxy all data and records concerning said
Intellectual Property in such a manner as to preserve their
secrecy upon termination of this Agreement.
B. Covenant. SFI covenants and agrees that it will not, other than
pursuant to the terms of this Agreement, whether directly or
indirectly, and whether as owner, manager, operator, consultant,
contractor or otherwise, manufacture the Products or use any
Intellectual Property for the benefit of itself or for the benefit
of any other person or entity.
13
<PAGE>
C. Remedies. SFI recognizes that irreparable injury will result to
Galaxy in the event of a breach by SFI of any of the covenants
contained in this Section X and acknowledges that SFI's agreement to
be bound by the provisions of this Section X is a significant reason
for Galaxy's decision to enter into this Agreement and the Purchase
Agreement. In the event that SFI shall engage in any act or behavior
in violation of these covenants, SFI agrees that Galaxy shall be
entitled, in addition to such other remedies and damages as may be
available to it by law or under this Agreement, to preliminary
and/or permanent injunctive relief, without the necessity of posting
a bond, prohibiting SFI from engaging in such act or behavior. The
provisions of this paragraph shall survive the termination of this
Agreement.
XI. NOTICES. Notices hereunder shall be in writing signed by the Party serving
the same and shall be sent, if mailed, by Registered or Certified U.S.
Mail, Return Receipt Requested, postage prepaid; by a nationally
recognized overnight courier; by telefax; or by e-mail; and
If intended for Galaxy, shall be addressed to:
Galaxy Nutritional Foods, Inc.
2441 Viscount Row
Orlando, FL 32809-6217
Attention: Michael Broll
Phone: (407) 854-0463
Telefax: (407) 854-0491
e-mail: mebroll@galaxyfoods.com
with a copy (which shall not constitute notice)to:
Proskauer Rose LLP
1585 Broadway
New York, New York 10036
Attention: Arnold J. Levine, Esquire
Telephone: (212) 969-3310
Telefax: (212) 969-2900
e-mail: alevine@proskauer.com
14
<PAGE>
If intended for SFI, shall be addressed to:
Schreiber Foods, Inc.
425 Pine Street
P.O. Box 19010
Green Bay, Wisconsin 54307-9010
Attention: Ron Dunford
Phone: (920) 455-6249
Telefax: (920) 455-2226
e-mail: Ron.Dunford@schreiberfoods.com
Or to such other address as either Party may have furnished in a notice to
the other from time to time as a place for the service of notice. All such
notices, shall, when mailed or sent, respectively, be effective (i) three
days after being deposited in the mails, (ii) one business day after being
deposited with the express overnight courier service or sent by electronic
facsimile transmission (with receipt confirmed), or (iii) upon sender's
receipt of a confirmation of receipt from the recipient if sent by e-mail,
respectively, addressed as aforesaid.
XII. CONFIDENTIAL INFORMATION. Each Party acknowledges that in conducting its
operations, each employs certain trade secrets and other confidential and
proprietary information and know-how which are valuable, special, unique,
and proprietary assets of their respective businesses, and which each
takes reasonable steps to protect from disclosure to third parties
(hereinafter "Confidential Information"). Each Party acknowledges that as
a result of the relationship between them, certain Confidential
Information (including, without limitation, volume, delivery, customer and
pricing information under this Agreement), may come into the possession of
the other and/or its key employees. Each Party agrees that it will not,
except as may in good faith be believed to be required by law or
regulation, directly or indirectly make use of or knowingly disclose to
any third-parties, including guests or invitees, such Confidential
Information without first obtaining the prior written consent of the other
or until such Party can establish that the same shall have lawfully become
a matter of public knowledge through no fault of the recipient Party;
provided, however, that any Intellectual Property that is a trade secret
under the Uniform Trade Secrets Act, or is statutorily protected by any
act or issuance of the United States Patent and Trademark Office or any
state equivalent thereof, shall remain subject to the requirements
contained in Section X and this Section XII notwithstanding the fact that
the same has become a matter of public knowledge. Notwithstanding the
foregoing, each Party may provide such Confidential Information to any
third party who has expressed an interest in acquiring such Party's
business (whether by sale of all of its capital stock, all or
substantially all of its assets, merger, or otherwise), provided, however,
that such third party shall have executed a confidentiality agreement in
the form attached hereto as Exhibit D. All plant visits made by Galaxy
personnel or their representative(s) to an SFI facility will require the
signing of the standard SFI confidentiality agreement (in the form
attached hereto as Exhibit C) at the time of the visit.
15
<PAGE>
Each Party agrees that a breach of this covenant on Confidential
Information will result in irreparable and continuing damage to the
non-breaching Party for which money damages may not provide adequate
relief. Each Party therefore agrees that breach of this covenant
concerning Confidential Information shall entitle the other to both
preliminary and permanent injunctive relief, without the necessity of
posting a bond, as well as money damages insofar as they can be determined
under the circumstances, together with such other legal and equitable
remedies as may be available. This Section concerning Confidential
Information shall survive the expiration or termination of this Agreement.
SFI acknowledges that Galaxy has certain public reporting obligations
under the U.S. securities regulations, and that, as a result thereof, a
copy of this agreement may need to be publicly filed with the Securities
and Exchange Commission. If Galaxy and its counsel determine that this
Agreement must be publicly filed with the Securities and Exchange
Commission, Galaxy shall request confidential treatment in accordance with
the procedures set forth under Rule 24b-2 of the Securities Exchange Act
of 1934 under the provisions of 5 USCS ss. 552(b)(4) and corresponding
regulation 17 C.F.R. ss. 200.80(b)(4) with respect to Exhibit A and
Exhibit B of this Agreement and any other provision (or portion thereof)
as SFI may reasonably request.
XIII. FORCE MAJEURE. Excluding any payment obligations herein, if either Party
hereto is prevented from complying either totally or in part, with any of
the terms or provisions of this Agreement by reason of Force Majeure that
is demonstrably beyond its control, then upon written notice to the other
Party that based on such cause, the requirements of this Agreement, or
such of its provisions as may be affected, to the extent affected, will be
suspended and the performance of this Agreement by the Party affected by
the Force Majeure may be suspended without causing a breach or default of
this Agreement during the period of such disability (without, however, any
concomitant extension of the Term); provided, however, that any Party
prevented from complying shall make all reasonable good faith efforts to
remove such disability as soon as practicable. Failure to make such
reasonable good faith efforts shall constitute grounds for the termination
of this Agreement by the other Party. Notwithstanding any provision of
this Agreement to the contrary, should an event of Force Majeure prevent
SFI from supplying Galaxy's requirements of Product, SFI agrees to
allocate and supply to Galaxy its then available supply of Product on a
basis that is substantially proportional to the volume of Product SFI
allocates and supplies to its other retail customers. Such allocation
shall be based on the then current volumes of Products purchased by Galaxy
and SFI's other retail customers. Should the occurrence of an event of
Force Majeure prevent SFI, or be reasonably expected to prevent SFI, from
supplying Galaxy with its requirements of Product, Galaxy shall have the
right to enter into a purchasing arrangement for such Products (and only
such Product as SFI shall not be able to supply Galaxy) during the term of
such suspension.
16
<PAGE>
XIV. INTELLECTUAL PROPERTY RIGHTS. Galaxy may not use, without prior written
consent of SFI, any patents, trademarks, trade names, trade secrets,
copyright materials, trade dress or other similar intellectual property of
SFI.
XV. ASSIGNMENT. This Agreement shall not be assignable by either Party except
upon the written consent of the other Party, which such consent may be
withheld for any reason whatsoever; provided, however, that each Party
shall assign this Agreement in connection with a sale of such Party's
business (whether by sale of a majority of its capital stock, all or
substantially all of its assets, merger, or otherwise), the purchaser must
accept the assignment, and the prior written consent of such other Party
shall not be required in connection therewith.
XVI. SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon and inure to
the benefit of each of the Parties hereto and their respective successors
and assigns (as such are permitted).
XVII. NON-WAIVER. The failure of Galaxy or SFI to enforce any of the rights
given to either of them under this Agreement, shall not be construed as a
waiver of the right of Galaxy or SFI to exercise any such rights as to any
subsequent violations of such covenants, or as a waiver of any of the
rights given to Galaxy or SFI by reason of any of the other covenants of
this Agreement.
XVIII. CONSTRUCTION OF AGREEMENT. Words of any gender used in this Agreement
shall be held to include any other gender, and word in the singular number
shall be held to include the plural, when the sense requires. Wherever
used herein the words "Galaxy" or "SFI" shall be deemed to include the
heirs, personal representatives, successors, and permitted assignees of
such Parties, unless the context excludes such construction. All exhibits
attached to this Agreement are a part of and are incorporated into this
Agreement. This Agreement has been drafted jointly by the Parties and
shall not be construed against either Party.
XIX. INVALIDITY OF PROVISIONS. If any term or provision of this Agreement or
the application thereof to any person, entity or circumstance shall, to
any extent, be invalid or unenforceable, the remainder of this Agreement,
or the application of such term or provision to any person, entity or
circumstance other than those to which it is held invalid or
unenforceable, shall not be affected thereby.
XX. HEADINGS. It is understood and agreed that the headings are inserted only
as a matter of convenience and for reference, and in no way define, limit,
or describe the scope or intent of this Agreement, nor in any way affect
this Agreement.
17
<PAGE>
XXI. GOVERNING LAW. This Agreement shall be construed in accordance
with the substantive laws of the State of Wisconsin, without
regard to the application of any conflict of law principles.
XXII. NO RELATIONSHIP. This Agreement shall not constitute or be
construed so as to give rise to a partnership or joint venture
between the Parties. All operations by either Party under the
terms of this Agreement shall be carried on by such Party
independently and not as agent of the other. It is intended that
Galaxy and SFI shall at all times be independent of each other in
all operations and actions under this Agreement.
XXIII. INTEGRATION. This Agreement contains the entire agreement and
understanding concerning the subject matter hereof between Galaxy
and SFI, and supersedes and replaces any and all prior
negotiations, proposed agreements and agreements, written or oral.
Except as otherwise provided herein, this Agreement shall not be
modified, amended or supplemented, and no provision of this
Agreement shall be waived by purchase orders, acknowledgments of
purchase orders, invoices or other documents exchanged between the
Parties, except by an agreement in writing signed by both Parties.
XXIV. COUNTERPARTS. This Agreement may be executed simultaneously in two
or more counterparts, each of which shall be deemed an original
but all of which together shall constitute one and the same
agreement.
XXV. RIGHT OF SET OFF. Neither Party may set off or declare an offset
against any payment obligation to the other without the written
agreement of the other Party.
XXVI. COUNTERPARTS. This Agreement may be executed in one or more
counterparts , each of which shall be deemed an original, but all
of which together shall constitute one and the same instrument.
XXVII. THIRD PARTY BENEFICIARIES. The warranties, guaranties, covenants,
obligations and duties (including, without limitation,
indemnification obligations) of SFI hereunder shall be made for
the benefit of Galaxy and its customers, and all customers of
Galaxy are and shall be intended third party beneficiaries
thereof.
[Signature page follows]
18
<PAGE>
IN WITNESS WHEREOF, the Parties hereto have caused this Supply Agreement
to be executed by their duly and lawfully authorized officers.
GALAXY NUTRITIONAL FOODS, INC.
By: /s/ David H. Lipka
-----------------------------------
Name: David H. Lipka
Its: Chairman
SCHREIBER FOODS, INC.
By: /s/ Ron Dunford
----------------------------------
Name: Ron Dunford
Its: President and COO of
Schreiber Chain Sales
<PAGE>
EXHIBIT A
PRODUCTS
ITEM NO. DESCRIPTION
-------- ---------------
IWS SLICES
00077 NERY'S SANDWICH SLICES 48/10 2/3OZ
00110 SUNFLOWER FARMS 48/10 2/3OZ
00111 SUNFLOWER FARMS 12/10 2/3OZ
00117 STARFIRE FARMS 48/10 2/3OZ
00138 NERY'S SANDWICH SLICES 12/8OZ
01922 EEZY BRAND CHEDDAR SLICES 48/10 2/3OZ
13191 LITTLE ANGEL'S SANDWICH SLICE 48/10 2/3OZ
20003 DAYCO SANDWICH SLICE 48/10 2/3OZ
20004 DAYCO WHITE SANDWICH SL 48/10 2/3OZ
34020 SOYA SLICE MOZZ 12/6OZ
34025 SOYA SLICE CHED 12/6OZ
34117 BREW VEG SL MOZZ 12/6OZ
34118 BREW VEG SL CHEDDAR 12/6OZ
34125 BREW VEG SL SWISS 12/6OZ
34140 BREW RICE SLICE MOZZ 12/6OZ
34142 BREW RICE SLICE CHED 12/6OZ
34736 AM CHOICE SAND SL 48/10 2/3oz
40005 FIESTA SANDWICH SLICE 36/16OZ
40006 FIESTA SANDWICH SLICE 48/10 2/3OZ
40212 BLUE ROCK SANDWICH SLICES 48/10 2/3OZ
45005 GAL SANDWICH SL 12/8OZ
45010 GAL SANDWICH SL 48/10 2/3OZ
45017 GAL WHIT SAND SLICE 48/ 10 2/3 OZ
45033 GAL PEP JACK SAND SLICE 48/10 2/3OZ
48000 GAL ORG CHEESE FD 12/8OZ
48002 GAL ORG MOZZ CH FD 12/8OZ
49001 GAL MEXICAN SAND SL 48/10 2/3OZ
56020 SUPER A SAND SL 48/10 2/3OZ
64020 SOYMAGE MOZZ SOYSINGLES 12/6OZ
64025 SOYMAGE Y AM SOYSINGLES 12/6OZ
64117 SOYCO MOZZ VEGGY SNGL 12/6OZ
64118 SOYCO YEL AM VEGGY SINGL 12/6OZ
64121 SOY PEP JACK VEG SINGLE 12/6OZ
64125 SOYCO SWISS VEGGY SNGL 12/6OZ
64129 SOYCO CHED VEGGY SNGL 12/6OZ
64137 SOYCO PROV VEG SINGLES 12/6OZ
64140 SOYCO MOZZ RICE SLICE 12/6OZ
64142 SOYCO YEL AM RICE SLICE 12/6OZ
64154 SOYCO PEP JACK RICE SL 12/6OZ
64155 SOYCO SWISS RICE SLICE 12/6OZ
64156 SOYCO CHED RICE SLICE 12/6OZ
<PAGE>
ITEM NO. DESCRIPTION
-------- ---------------
66000 FARMS CREAMERY SANWICH SL 48/10 2/3OZ
66717 GAL YEL AM VEGGIE SLICE 12/8OZ
66718 GAL PEP JACK VEG SLICE 12/8OZ
66719 GAL PROV VEGGIE SLICE 12/8OZ
66720 GAL MOZZ VEGGIE SLICE 12/8 OZ
66721 GAL SWISS VIEGGIE SLICES 12/8 OZ
66722 GAL CHED VEGGIE SLICE 12/8 OZ
66753 GAL JAL CHED VEGGIE SL 12/8OZ
71125 DEL PORTAL CHED SL 48/10 2/3OZ
71126 DEL PORTAL MOZZ SL 48/10 2/3OZ
80201 DON FRANSISCO SAND SLICE 48/10 2/3OZ
85004 GALAXY SAND SL 12/10 2/3OZ
85010 GAL SANDWICH SL 48/10 2/3OZ-CANADIAN
86717 GAL CAN FL VEG SL 12/10 2/3OZ
86720 GAL MOZZ VEG SL 12/10 2/3OZ-CANADIAN
86722 GAL CHED VEG SL 12/10 2/3OZ-CANADIAN
00195 WILSON AMERICAN 48/10 2/3
00199 WILSON SWISS 48/10 2/3OZ
00703 GMT SUN VALLEY 48/10 2/3
45010-99 GAL SANDWICH SL 48/10 2/3OZ
45017-99 GAL WHIT SAND SLICE 48/ 10 2/3 OZ
49001-99 GAL MEXICAN SAND SL 48/10 2/3OZ
91945-30023 4030 BV SANDWICH SLICE 48/10 2/3OZ
CAN-64117 SOYCO ITALIAN/MOZZ VEGGY SINGLE 12/6OZ
CAN-64118 SOYCO YEL AM VEGGY SINGL 12/6OZ
CAN-64140 SOYCO MOZZ RICE SLICE 12/6OZ
CAN-64142 SOYCO YEL AM RICE SLICE 12/6OZ
ISR-64117 SOYCO MOZZ VEGGY SNGL 12/6OZ
ISR-64120 SOYCO WHITE CHED VEG SNGLS 12/6OZ
ISR-64125 SOYCO SWISS VEGGY SNGL 12/6OZ
ISR-64127 SOYCO GARLIC & HERB 12/6OZ
ISR-64128 SOYCO EDAM SLICES 12/6OZ
ISR-64136 SOYCO FETA VEG SNGL 12/6OZ
ISR-64137 SOYCO PROV VEG SNGL 12/6OZ
ISR-64140 SOYCO MOZZ RICE SLICE 12/6OZ
BLOCK
-----
24164 GAL SALAD BAR CHED 40#
30062 GALAXY MOZZ SUB 20#
30072 GALAXY IMIT MOZZ 20#
30082 GAL IMIT MOZZ 900404 20#
30102 CHEDDAR IMITATION 20#
30122 SWISS IMITATION 20#
30142 PROVOLONE IMITATION 20#
66272 GALAXY VEGGIE CHED BLOCK 20#
<PAGE>
ITEM NO. DESCRIPTION
-------- ---------------
66452 GAL MOZZ VEG BLOCK
CH2416AA SALAD BAR CHED
CH2650EE IMITATION CHED SHRED BLOCK
CH3010EE IMITATION CHEDDAR BLOCK
CH3011EE IMITATION CHEDDAR BLOCK
CH3012EE IMITATION CHEDDAR BLOCK
CH5904EE CHEDDAR CHEESE PRODUCT BLOCK
CH6627EE VEGGIE CHED CHUNK BLOCK
CH6635EE VEGGIE CHEDDAR SHRED BLOCK
CH7901EE ORGANIC CHED SHRED/CHUNK BLOCK
CH7951EE ORGANIC CHEDDDAR SHRED/CHUNK BLOCK
CH8707EE RICE CHEDDAR BLOCK FOR SHREDS
CH8713EE RICE CHEDDAR CHUNK BLOCK
CH8803EE VEGAN CHEDDAR CHUNK BLOCK
CP6623EE VEGGIE CHIPOTLE CHUNK BLOCK
MJ2652EE IMITATION MONT JACK SHRED BLOCK
MZ2418EE SALAD BAR MOZZ BLOCK
MZ3007EE IMITATION MOZZ BLOCK
MZ3008EE IMITATION MOZZ BLOCK
MZ3009EE IMITATION MOZZ BLOCK
MZ6625EE VEGGIE MOZZ CHUNK BLOCK
MZ6634EE VEGGIE MOZZ SHRED BLOCK
MZ6650EE GALAXY VEGGIE MOZZ BLK 20# - ISR
MZ7902EE ORGANIC MOZZ SHRED/CHUNK BLOCK
MZ7952EE ORGANIC MOZZ SHRED/CHUNK BLOCK
MZ8708EE RICE MOZZ SHRED BLOCK
MZ8716EE RICE MOZZ CHUNK BLOCK
MZ8804EE VEGAN MOZZ CHUNK BLOCK
PJ2654EE IMITATION PEPPER JACK SHRED BLOCK
PJ6629EE VEGGIE PEPPER JACK CHUNK BLOCK
PJ6636EE VEGGIE PEPPER JACK SHRED BLOCK
PM7100EE IMITATION PARM BLOCK
PM8706EE VEGGIE PARM BLOCK 20#
PM8723EE RICE PARM BLOCK
PM9602EE VEGGIE PARM/MOZZ/ROMANO BLEND BLOCK
SOFT CHEESE
---------------
66728 GAL VEGGIE SOUR CREAM 12/8OZ
64017 SOYMAGE SOUR CREAM 12/8OZ
64138 SOYCO RICE SOUR CREAM 12/8OZ
66729 GAL VEGGIE CREAM CHEESE 12/8OZ
66723 GAL VEGGIE BUTTER 12/8OZ
64141 SOYCO RICE BUT SPREAD 12/8OZ
66783 GALAXY VEGGIE QUESO CHEESE SAUCE 12/8OZ
66784 GALAXY VEGGIE GARLIC/HERB DIP 12/8OZ
64139 SOYCO RICE CREAM CHEESE 12/8OZ
64018 SOYMAGE CREAM CHEESE 12/8OZ
<PAGE>
ITEM NO. DESCRIPTION
-------- ---------------
PULLMAN SLICES
00701 TWOGETHER SANDWICH SLICE-120S 4/5#
11100 GAL INST SAND SLICE-160S 6/5#
89050 GMT COUNTRY LEGEND 160S 4/5#
89100 BLUE RIBBON SNAD SL 160S 4/5#
90100 GAL GOODVALUE SAND SLICE-160S 4/5#
90200 GAL GOODVALUE WH SAND SL-160S 4/5#
04012 EARLY DAWN WHITE 160S 4/5#
18460 BELCA PAST PROCESS SAND SL-160S 4/5#
05076 SOMMERMAID SAND SLICE-126S 4/5#
05078 SOMMERMAID SAND SLICE-160S 4/5#
04016 EARLY DAWN YELLOW 160S 4/5#
99120 GALAXY PP YELLOW SS 160S 4/5#
GRATED PARM
66724 GAL PARM VEGGIE TOPPING 12/8OZ
86724 GAL PARM VEGGIE TOPPING 12/8oz-CANADIAN
64149 SOYCO GRATED RICE PARM 12/4OZ
CAN-64149 SOYCO GRATED RICE PARM 12/4OZ
64123 SOYCO GRATED PARM 12/4OZ
64000 SOYMAGE GRATED PARM 12/4OZ
78005 IMITATION PARMESAN 25#
A45080 SUPREME PARMESAN 12/8OZ
SHREDS
00114 STARFIRE FARMS TACO SHRED 12/8OZ
00201 SUNFLOWER FARMS JACK SHRED 12/2#
00203 SUNFLOWER FARMS CO-JACK CHED SHRED 12/2#
20001 DAYCO SHRED MOZZ 24/8OZ
20002 DAYCO SHRED CHED 24/8OZ
24161 GALAXY SALAD BAR 4/5#
26500 GALAXY SHRED CHED 12/2#
26520 GALAXY SHRED GOLD/JACK 12/2#
26540 GALAXY SHRED SOUTH OF THE BORDER 12/2#
30071 GALAXY IMIT MOZZ SHRED 4/5#
30081 GAL IMIT MOZZ SHRED 4/5#
30101 CHEDDAR IMITATION 4/5#
30111 GALAXY IMIT CHED SHRED 4/5#
42408 AMERICAN CHOICE CHED SHRED 6/2#
48020 GAL ORG CHED SHRED 12/6OZ
48022 GAL ORG MOZZ SHRED 12/6OZ
<PAGE>
ITEM NO. DESCRIPTION
-------- ---------------
49000 GAL PIZZA TOPPING 12/8OZ
49004 GAL TACO TOPPING 12/8 OZ
59043 GAL FINE SHRED 6/5#
64244 SOYCO MOZZ RICE SHREDS 12/8OZ
64245 SOYCO CHED RICE SHREDS 12/8OZ
66451 GAL MOZZ VEG SHRED 4/5#
66770 GAL MOZZ VEGGIE SHREDS 12/8OZ
66771 GAL CHED VEGGIE SHREDS 12/8OZ
66772 GAL VEG CHED/PEP JACK SHRED 12/8OZ
66773 GAL VEG PARM/MOZZ/ROM FS 12/6OZ
66774 GAL VEG MJ/CHED SHRED 12/8OZ
80975 AMERICAN CHOICE COLBY JACK SHRED 6/2#
86770 GAL MOZZ VEGGIE SHREDS 12/8OZ-CANADIAN
86771 GAL CHED VEGGIE SHREDS 12/8OZ-CANADIAN
92648 AMERICAN CHOICE MOZZ SHRED 6/2#
96021 GAL VEG PARM/MOZZ/ROM BLEND 4/5#
00280 GMT SUN VALLEY IMITATION CHED. 12/8OZ
00281 GMT SUN VALLEY IMITATION MOZZ. 12/8OZ
CHUNKS
48010 GAL ORG CHED CHUNK 12/8OZ
48012 GAL ORG MOZZ CHUNK 12/8OZ
64007 GALAXY VEGAN CHED CHUNK 12/8OZ
64008 GALAXY VEGAN MOZZ CHUNK 12/8OZ
64178 SOYCO RICE CHED CHUNK 12/8OZ
64179 SOYCO RICE MOZZ CHUNK 12/8OZ
66737 GAL CHED VEG CHEF'S AWD CHK 12/8OZ
66754 GAL MOZZ VEG CHEF'S AWD CHK 12/8OZ
66785 GAL PEP JACK VEG CHEF'S AWD CHK 12/8OZ
66786 GALAXY VEGGIE CHIPOTLE CHUNK 12/8OZ
84178 SOYCO RICE CHED CHUNK 12/8OZ-CAN
84179 SOYCO RICE MOZZ CHUNK 12/8OZ-CAN
86737 GAL CHED VEG CHEF'S AWD CHK 12/8OZ-CANADIAN
86754 GAL MOZZ VEG CHEF'S AWD CHK 12/8OZ-CANADIAN
<PAGE>
EXHIBIT B
PRICE
--------------------------------------------------------------------------------
Item Ingredients, Packaging + Distribution + Conversion
and Raw Materials
--------------------------------------------------------------------------------
Cost *** + *** + Fixed per Product
as set forth on
the Product
Matrix, and as
adjusted pursuant
to Section
III.B. hereof.
--------------------------------------------------------------------------------
PRODUCT MATRIX
Product Conversion
Per Pound
------------------------------ ----------------------------------------
IWS Slices ***
Pullman 5 lb. Slices ***
Block ***
8 oz. Shred Imitation ***
8 oz. Shred Veggie ***
2 lb. Shreds ***
Soft Cheese(a) ***
Grated Parmesan(a) ***
Chunk(a) ***
(a) Conversion pricing for Soft Cheese, Grated Parmesan and Chunk shall be
subject to adjustment after six months from the Effective Date, as negotiated in
good faith by the parties and, to the extent applicable, in a manner that is as
consistent with the pricing described for the other Product Lines as is
practicable.
*** Indicates material omitted pursuant to a confidential treatment request
and filed separately with the Securities and Exchange Commission.
More on company value EBITDA
EBITDA last Q (a non-GAAP measure) $801,307
$801,307 x 4Q's = $3,205,228
Sale price multiple
$ 8,000,000 2.50
$10,000,000 3.12
$11,000,000 3.43
$12,000,000 3.74
$13,000,000 4.06 <=================== HERE
$14,000,000 4.37
$15,000,000 4.68
$16,000,000 4.99
$17,000,000 5.30
$18,000,000 5.62
$19,000,000 5.93
$20,000,000 6.24
$21,000,000 6.55
$22,000,000 6.86 <=================== to HERE
$23,000,000 7.18
$24,000,000 7.49
$25,000,000 7.80
$26,000,000 8.11
$27,000,000 8.42
$28,000,000 8.74
$29,000,000 9.05
$30,000,000 9.36
A buyer must assume\believe that EBITDA can be attained!
More on Company value....8K incentive
I think the 8K is the company min....
A 1.8% incentive... min of $250,000
Sales price 1.80%
$8,000,000 $144,000
$10,000,000 $180,000
$11,000,000 $198,000
$12,000,000 $216,000
$13,000,000 $234,000
$14,000,000 $252,000 <=======================
$15,000,000 $270,000
$16,000,000 $288,000
$17,000,000 $306,000
$18,000,000 $324,000
$19,000,000 $342,000
$20,000,000 $360,000
$21,000,000 $378,000
$22,000,000 $396,000
$23,000,000 $414,000
$24,000,000 $432,000
$25,000,000 $450,000
$26,000,000 $468,000
$27,000,000 $486,000
$28,000,000 $504,000
$29,000,000 $522,000
$30,000,000 $540,000
More on company value...
This would assume a smart buyer come in and stop that supply agreement NOW!
Current assets $4,308,039
Current Lia ($2,926,381)
============================
total $1,381,658
Deluca ($2,683,815)
===========================
total ($1,302,157)
short-fall pmt ($3,500,000)
===========================
Debt ($4,802,157)
Sold for…… Debt…….. total……… 17,110,016
$8,000,000 -4,802,157 $3,197,843 $0.19
$10,000,000 -4,802,157 $5,197,843 $0.30
$11,000,000 -4,802,157 $6,197,843 $0.36
$12,000,000 -4,802,157 $7,197,843 $0.42
$13,000,000 -4,802,157 $8,197,843 $0.48
$14,000,000 -4,802,157 $9,197,843 $0.54
$15,000,000 -4,802,157 $10,197,843 $0.60
$16,000,000 -4,802,157 $11,197,843 $0.65
$17,000,000 -4,802,157 $12,197,843 $0.71
$18,000,000 -4,802,157 $13,197,843 $0.77
$19,000,000 -4,802,157 $14,197,843 $0.83
$20,000,000 -4,802,157 $15,197,843 $0.89
$21,000,000 -4,802,157 $16,197,843 $0.95
$22,000,000 -4,802,157 $17,197,843 $1.01
$23,000,000 -4,802,157 $18,197,843 $1.06
$24,000,000 -4,802,157 $19,197,843 $1.12
$25,000,000 -4,802,157 $20,197,843 $1.18
$26,000,000 -4,802,157 $21,197,843 $1.24
$27,000,000 -4,802,157 $22,197,843 $1.30
$28,000,000 -4,802,157 $23,197,843 $1.36
$29,000,000 -4,802,157 $24,197,843 $1.41
$30,000,000 -4,802,157 $25,197,843 $1.47
Wall Street.. I got this..
a check might be this... The following was from 4/05 to 4/06
Casein Price Months % at price Dollars Pounds
$3.360 27 52% $3,237,404 963,513
$3.275 12 23% $1,438,846 439,342
$3.210 13 25% $1,558,750 485,592
Avg$3.30 52 100% $6,235,000 1,888,447
Specified Level of Production
So I wake up early & decide to find the supply agreement & level of production required to avoid a shortfall payment.
& after digging through SEC reports back to early 2005 I find that in every report I scanned through the Specified Level of Production is never referred to as a number, only as specified level of production.
So the question is still what is the specified level of production. According to a recent report the agreement was modified to:
The Supply Agreement originally provided for a contingent short-fall payment obligation up to $8,700,000 by the Company if a specified production level was not met during the one-year period from September 1, 2006 to August 31, 2007. If a contingent short-fall payment was accrued after such one-year period, it could be reduced by the amount by which production levels in the one-year period from September 1, 2007 to August 31, 2008 exceeded the specified target level of production, if any. The short-fall payment is based on a formula that calculates the payment as follows: ((required pounds shipped - actual pounds shipped) / required pounds shipped) * $8,700,000. In November 2006, the Supply Agreement was amended so that the short-fall payment obligation would not be measured until the one-year period from September 1, 2009 to August 31, 2010, and the target level of production was reduced by approximately 22%.
So the target level of production is now 22% less than the original specified level of production.
But what was the original specified level of production?
I was watching that and it sure seems as though you have something
I know one thing...
Get rid of that supply agreement the company is worth $6.4 million dollars more then today.
Someone thinks the 20's is a very good deal... and I think after the holiday we pop...
Giff yep the worth is definitely what is important, hence why I have asked that question several times of Veritas and you, trying to get a feel for it. Thus far the water is so murky that many folks don't know to buy or to sell. lol
They don't give enough to really know...
I did some basic guesses and my spread has them about 1 million pounds short... annual
that about 2 million packages... at say $2... we'd need $4 mil in additional sales... and this is at the last year renegotiated 22% less number... but I don't know, I think they have to pay for past sins too.. meaning they'll never catch up.
Well...
I coulda opened em....
But then woulda lost the marketing effect...
What was the volume required on that supply agreement?
Well Wall Street Antiques... You should have opened them, sliced them, and put them on a wheat cracker... Some big guy woulda ate'm... LOL
Wish it could... but that is not going to happen.
Did you hear this.... Shortfall payment?
"Lock-in from a strategic partnership"
http://www.geocities.com/syte.storage/AudioCC112007.wma
Mike!!!! FIX THIS!!!
How bout we figure a chart where
We sell enough product to take out the shortfall.
Now that would be interesting...
Let's take that short-fall payment out...
Sold for…… Debt…….. total……… 17,110,016 (PPS)
$8,000,000 1,302,157 $6,697,843 $0.39
$10,000,000 1,302,157 $8,697,843 $0.51
$11,000,000 1,302,157 $9,697,843 $0.57
$12,000,000 1,302,157 $10,697,843 $0.63
$13,000,000 1,302,157 $11,697,843 $0.68
$14,000,000 1,302,157 $12,697,843 $0.74
$15,000,000 1,302,157 $13,697,843 $0.80
$16,000,000 1,302,157 $14,697,843 $0.86
$17,000,000 1,302,157 $15,697,843 $0.92
$18,000,000 1,302,157 $16,697,843 $0.98
$19,000,000 1,302,157 $17,697,843 $1.03
$20,000,000 1,302,157 $18,697,843 $1.09
$21,000,000 1,302,157 $19,697,843 $1.15
$22,000,000 1,302,157 $20,697,843 $1.21
$23,000,000 1,302,157 $21,697,843 $1.27
$24,000,000 1,302,157 $22,697,843 $1.33
$25,000,000 1,302,157 $23,697,843 $1.39
$26,000,000 1,302,157 $24,697,843 $1.44
$27,000,000 1,302,157 $25,697,843 $1.50
$28,000,000 1,302,157 $26,697,843 $1.56
$29,000,000 1,302,157 $27,697,843 $1.62
$30,000,000 1,302,157 $28,697,843 $1.68
To settle the shortfall isssue
All we have to do here is sell more cheese.
Grassroots online guerilla marketing attack.
Simple.
Sell more cheese. More revenue. No shortfall.
Win, Win, Win.
Best way to figure out the golden parachute thing is to ask Deluca how much he wants for his shares.
The current market cap of 4.2 million is quite cheap IMO.
Took some smoked provalone slices to the christmas party last night. Course no one opened them, last I saw, & they just sat on the table. Perhaps a new customer took them home.
It is absolutly IMPORTANT we all write the non-managing board members a letter asking to settle the short-fall payment issue!!!
Non-Management Directors, Board of Directors
Attention: Corporate Secretary.
Galaxy Nutritional Foods, Inc.
5955 T.G. Lee Blvd., Suite 201
Orlando, FL 32822
More on what this company is worth...
1) Total current assets $4,308,039 less current liabilities $2,926,381 = $1,381,658
2) RELATED PARTY NOTE PAYABLE (Deluca) $2,683,815
3) short-fall payment could exceed $6,400,000
Total = $1,381,658 - $2,683,815 - $6,400,000 = (7,702,157)
17,110,016 share outstanding
so...
Sold for Debt total 17,110,016
$8,000,000 $7,702,157 $297,843 $0.02
$10,000,000 $7,702,157 $2,297,843 $0.13
$11,000,000 $7,702,157 $3,297,843 $0.19
$12,000,000 $7,702,157 $4,297,843 $0.25
$13,000,000 $7,702,157 $5,297,843 $0.31
$14,000,000 $7,702,157 $6,297,843 $0.37
$15,000,000 $7,702,157 $7,297,843 $0.43
$16,000,000 $7,702,157 $8,297,843 $0.48
$17,000,000 $7,702,157 $9,297,843 $0.54
$18,000,000 $7,702,157 $10,297,843 $0.60
$19,000,000 $7,702,157 $11,297,843 $0.66
$20,000,000 $7,702,157 $12,297,843 $0.72
$21,000,000 $7,702,157 $13,297,843 $0.78
$22,000,000 $7,702,157 $14,297,843 $0.84
$23,000,000 $7,702,157 $15,297,843 $0.89
$24,000,000 $7,702,157 $16,297,843 $0.95
$25,000,000 $7,702,157 $17,297,843 $1.01
$26,000,000 $7,702,157 $18,297,843 $1.07
$27,000,000 $7,702,157 $19,297,843 $1.13
$28,000,000 $7,702,157 $20,297,843 $1.19
$29,000,000 $7,702,157 $21,297,843 $1.24
$30,000,000 $7,702,157 $22,297,843 $1.30
That just would not make sense to me...
That 8K give incentive for CEO and COB to sell the company... remember that 1.8% post...
You gotta think, if you want buy, you are not going to offer your employees that deal..
I think we must now start thinking .. what is this company worth?
Giff just a thought since Deluca is connected, as is the major supplier for both companies.
To sell the company.. they needed time to prove postive cash flow and net income.
This makes for a higher price.
This company is worth some money.
But will the board steal from us shareholders? Examples of Theft by boards...
(UFOG.OB) CEO (he holds over 50% holder) sold only his shares to China company. Then the China company gave the assets back to CEO. I think it's under SEC investigation.
(AMEX: CGL.A) Family (he holds over 50% holders) offer was $9.00 and they said not interested in any other offers. Book is over $10 and pps was as high as $11.50; Additionally, there forward looks very good. PPS is stuck in low $8's
Another thing that is concerning is theft by that supplier contract. They way that contract was written could be argued that it was gross negligence by the board and CEO. Who the hell gives a supplier some much power? Something was just not right about that deal.
I'm not happy with that 8K filed. Those exit contracts kill the sales price IMO.. why are they needed.. I say if any of those managers think it's greener the other side.. DON"T LET THE DOOR HIT YA ON THE WAY OUT!
Why would Subway want this company? They don't use the products.
Giff, since Deluca is involved, now what happens if Subway buys us, lol
I think it depends on who we fit best with.... and still trying to determine worth..
1) Private equity group
2) Food company
3) Employee purchase
4) Current shareholders (i.e. Fromageries Bel)
5) Schreiber because they hold that stupid contract
What is Deluca's cash investment over the years?
Ok Giff so putting that all together your guessing what?
(SALES: expected $2 million; SALE PRICE: around $2-$4 million ???)
J & J Snack Foods Acquires WHOLE FRUIT Sorbet and FRUIT-A-FREEZE Frozen Fruit Bar...
Mon Apr 2, 2007 3:00 PM ET
PENNSAUKEN, N.J.--(Business Wire)--J & J Snack Foods Corp. (NASDAQ:JJSF) announced today that it has
acquired the WHOLE FRUIT Sorbet and FRUIT-A-FREEZE Frozen Fruit Bar
brands, along with related assets including a manufacturing facility
located in Norwalk, CA, from a subsidiary of CoolBrands International,
Inc. (Toronto: COB.A-TO). J & J Snack Foods Corp. owns and
manufactures LUIGI'S Real Italian Ice, the #1 selling Italian ice in
the world and licenses the MINUTE MAID brand name for various frozen
novelty products.
The acquired brands had been experiencing declining sales for
several years with sales of approximately $10 million in 2006. The
Company said that it expects sales to be less than $2 million in its
fiscal year ending September 2007, but is hopeful of rebuilding the
brands and business going forward. The products will be sold through
its food service and retail supermarket business segments.
FRUIT-A-FREEZE is a super premium fruit bar featuring chunks of fruit.
WHOLE FRUIT sorbet is sold mainly in pints and is known for its
wholesome, healthy and upscale fruit flavors.
Gerald B. Shreiber, J & J's President and Chief Executive Officer,
commented, "These two premium brands add to our expanding portfolio of
frozen novelty products. Our goal is to improve upon their recent
performance in the retail supermarket segment as well as to expand
their presence in the food service market. In addition, the
manufacturing facility gives us a west coast plant for manufacturing
frozen novelty products that is expandable in the future which would
benefit logistics over the long term."
Food Company Acquisition (SALES: $23 million; SALE PRICE: $10 million)
TreeHouse Foods acquires DeGraffenreid 8th May 2007 By Leah Vyse TreeHouse Foods has acquired pickle processor DeGraffenreid for $10 million, plus an adjustment for working capital, from Bell-Carter Foods.
Missouri-based DeGraffenreid processes and distributes pickles and related products to the foodservice industry. The company has annual sales of around $23 million.
The purchase includes all of the company's working capital and production equipment. Concurrent with the acquisition of assets, TreeHouse said that it has entered into a lease for the land and buildings.
"We are impressed with DeGraffenreid's regional strength in the Midwest and Southern states, and solid relationships with leading National Account chain restaurants. Adding DeGraffenreid to our existing Bay Valley Foods operating unit creates an opportunity for accelerated growth in the attractive foodservice channel," said Sam Reed, chairman and CEO of TreeHouse Foods.
TreeHouse Foods, which primarily services the retail grocery and foodservice channels, produces pickles and related products; non-dairy powdered coffee creamer; private label soup and infant feeding products, and other food products including aseptic sauces, refrigerated salad dressings, and liquid non-dairy creamer
Food Company Acquisition (SALES: $60 million; SALE PRICE: $200 million)
B&G Foods Acquires Cream of Wheat Brand From Kraft Publication: Progressive Grocer Date: Wednesday, January 24 2007
PARSIPPANY, N.J. -- B&G Foods, Inc. here, said yesterday that a newly formed subsidiary of the company would acquire the Cream of Wheat and Cream of Rice hot cereal brands from Northfield, Ill.-based Kraft Foods Global, Inc. for about $200 million in cash.
Noted B&G Foods c.e.o. David L. Wenner in a statement: "Cream of Wheat is a strong brand name in the growing hot cereal category, and a brand that we think will do well within B&G Foods. This acquisition is very consistent with our strategy of acquiring smaller, higher-margin brands. We expect the acquisition to improve the already healthy margin structure of B&G Foods and to be accretive to our company's free cash flow. This is yet another example of B&G Foods' ability to grow dynamically through acquisition."
"Our decision to sell Cream of Wheat is part of a broader effort at Kraft to focus our portfolio," said Rick Searer, president, Kraft North America Commercial. "The divestiture allows us to focus our resources on businesses that offer potential long-term competitive advantages for us, creating value for Kraft shareholders, while providing B&G Foods with a great business." together yielded net sales of about $60 million last year.
B&G Foods said that it expects to pay for the acquisition with additional debt, and to complete this transaction, the company has received financing commitments for senior secured debt financing from Lehman Brothers, Inc. and Credit Suisse in an amount sufficient to fund the purchase price.
Under the terms of the acquisition agreement, B&G Foods will also buy certain manufacturing equipment. The company expects the deal to close in the first quarter of fiscal 2007, subject to regulatory approval and the satisfaction of customary closing conditions.
B&G Foods' brands include Ac'cent, B&G, B&M, Brer Rabbit, Emeril's, Grandma's Molasses, Joan of Arc, Las Palmas, Maple Grove Farms of Vermont, Ortega, Polaner, Red Devil, Regina, San Del, Trappey's, Underwood, Vermont Maid, and Wright's.
Kraft offer such products as Kraft cheeses, dinners, and dressings; Oscar Mayer meats, DiGiorno pizzas, Oreo cookies, Ritz crackers and chips, Philadelphia cream cheese, Milka and Cote d'Or chocolates, Planters nuts, Honey Bunches of Oats cereals, Jacobs, Gevalia, and Maxwell House coffees; Capri Sun, Crystal Light, and Tang beverages; and a line of South Beach Diet and better-for-you Sensible Solution items.
Food Company Acquisition (SALES $15.1 million; SALES PRICE $17.1 million)
Frutarom acquires UK flavors company Belmay 29th March 2007 By Laura Ellis
Israel-based Frutarom Industries has signed an agreement to acquire the UK flavors company Belmay for $17.1 million in cash.
RELATED ARTICLESFrutarom pays $4 million for Abaco in the US
Frutarom set to acquire Adumim Food Additives for $4.25 million 2 Jul 2007
Frutarom, a flavors and ingredients company, said that Belmay has subsidiaries in Singapore, Norway and Denmark, in addition to Belmay's UK site, which is located close to Frutarom's current production site in the UK.
Ori Yehudai, president and CEO of Frutarom, said: "Belmay's acquisition significantly strengthens Frutarom's technological capabilities and the product portfolio it offers its customers in the flavors field, especially in soft drinks and alcoholic beverages."
Frutarom said it is reviewing it's own and Belmay's activity in various countries and will take steps to achieve the greatest efficiency and annual operational savings of approximately $3 million.
Fruatrom said Belmay recently established a special research department to develop organic products. This department will be integrated with Frutarom's growing business in organic products.
Belmay's sales for 2006 totaled approximately $15.1 million.
SCHEDULE 14A INFORMATION: NOTICE OF ANNUAL MEETING OF STOCKHOLDERS TO BE HELD FRIDAY, JANUARY 18, 2008..
Giff yep thus far they have not made the SP ring in, but that was almost all casein related and lack of IR/PRs
yeh like us shareholders.. LOL
Giff: ohhhhhhh seems like they should give away more to the team they have working for them.
The sales bonus pool will be allocated 55.5% to David H. Lipka and 44.5% to Michael E. Broll upon the consummation of a sale of Galaxy.
I've concluded Deluca is throwing in the towel...
I just hope these guys do the right thing.. take the high road..
gifff ??????? what was that last post TIA
A 1.8% incentive...
min of $250,000
Sales Price.. Payday
$5,000,000 $90,000
$10,000,000 $180,000
$15,000,000 $270,000
$20,000,000 $360,000
$25,000,000 $450,000
$30,000,000 $540,000
giff those jumps are probably part of what the Fed is worried about with inflation.
Casein being a milk biproduct, and the according milk price rocketing you knew that was a major reason why Casein went up.
The hope is that they can pass a lot of it along to the consumer as did the mainstream product.
Look at soy price... 6.5 to 9.5.. huge 45 %
http://future.aae.wisc.edu/data/monthly_values/by_area/2051?tab=feed
milk.. Class2 skim.. 8.5 to 16 huge 88%... http://future.aae.wisc.edu/data/monthly_values/by_area/2014?tab=prices
Giff if their products have no casein then the RMs can't be the same high ones we face, or at least no where to the same degree unless everything else has doubled. Maybe I am not understanding you on this one.
Yeh but they are faced with same high raw prices..
just last Q they make net income of $125K... that sucks even worse then GXY...
yet we are punished because 2 large sellers.. that's the reason the stock is down.. you sell 2 million shares of a BB.. Those 2 sellers lost the Confidence of any buyers.. falling knife stuff.. It will take some time before enought demand comes back.
Giff that eliminates one big issue, and explains part of things.
TOF does not use casein as an additive.. thier products are more like our Vegan stuff..
Followers
|
4
|
Posters
|
|
Posts (Today)
|
0
|
Posts (Total)
|
828
|
Created
|
12/15/06
|
Type
|
Free
|
Moderators |
Volume | |
Day Range: | |
Bid Price | |
Ask Price | |
Last Trade Time: |