PENNANT
FOODS
March 30, 1998
Mrs. Fields Original Cookie Company
462 West Bearcat Drive
Salt Lake City, UT 84115
Re: Supply Agreement
Ladies and Gentlemen:
This letter sets forth the terms of the agreement between Mrs. Fields
Original Cookie Company ("Buyer") and LBI Acquisition Corp. d/b/a Pennant Foods
("Seller"), relating to the purchase by Buyer, and the sale by Seller, of cookie
dough and other bakery products, having the item codes and names listed on
attached Exhibit A, and "new bakery products" designated as such under Paragraph
5 below (collectively, "Products").
1.- Minimum Annual Purchase and Sale of the Products. Buyer agrees to
buy, and Seller agrees to sell, an amount not less than 23,000,000 pounds of the
Products during each of calendar years 1998, 1999, and 2000 (the "term").
2. Volume Incentives and Penalties.
(a) Rebate to Buyer. Within sixty (60) days after the end of
each calendar year during the term, Seller shall pay to Buyer a rebate for
purchases of the Products that exceed the minimum annual purchase obligation in
Paragraph 1 above. The amount of the rebate shall be determined by multiplying
the actual total pounds of the Products purchased by Buyer during the year by
the corresponding incentive payment rate listed in attached Exhibit B.
(b) Penalty Payment by Buyer. If Buyer fails to meet its
minimum annual purchase obligation under Paragraph 1, then, within sixty (60)
days after the end of the applicable calendar year during the term, Buyer shall
pay to Seller a penalty in an amount determined by multiplying 23,000,000 by the
per pound penalty rate listed in attached Exhibit C corresponding to the volume
of Products actually purchased by Buyer. The penalty is intended to compensate
Seller for its incremental unit cost of producing the lesser volume actually
purchased by the Buyer.
Mrs. Fields Original Cookie Company
Page 2
March 30,1998
(c) Remedies For Failure to Meet Minimum. If Buyer's failure
to purchase the minimum annual quantities of the Products required under
Paragraph 1 is attributable to a decrease in requirements for the Products due
to declines in Buyer's business, then the penalty payment by Buyer under
Paragraph 2(b) is the Seller's exclusive remedy. However, if Buyer's failure to
make such purchases is attributable to Buyer's purchase of like products from an
alternative supplier, then, in addition to the penalty payment by Buyer under
Paragraph 2(b), Buyer shall pay Seller a sum determined by multiplying the
volume shortfall by an amount equal to the Seller's weighted average of the
conversion charges for the Products purchased, as set forth on Exhibit A, less
Seller's variable manufacturing costs not incurred.
3. (a) Distributor Purchases. Distributors designated by Buyer,
who are approved by Seller and who meet Seller's normal standards of
creditworthiness, may order and purchase the Products and otherwise act on
Buyer's behalf pursuant to this Agreement. Any such distributor purchases, or
any purchases by or on behalf of Buyer's franchisees or licensees shall be
governed by the terms of this Supply Agreement (except to the extent
inconsistent with any separate agreement between Seller and any such franchisee
or licensee) and shall be counted towards Buyer's minimum annual purchase
obligation under Paragraph 1.
(b) Recovery of increased Distribution Costs.
(i) All shipments from Seller to Buyer's distributor
(currently BlueLine Distribution) will be on a full truck load basis. Less than
truck load shipments will be approved by Buyer's Distributor and the cost
between actual cost and full truck rate will be paid by Buyer's Distributor. In
the event that Buyer changes distributors or if the current distributor changes
its destination points from the current "ship to" locations, Seller is entitled
to recalculate freight costs and adjust the total conversion costs accordingly.
(ii) Should a Force Majeure Event (as defined in
Section 20 (a)) occur which affects the cost of transportation, Seller is
entitled to recalculate the freight costs and adjust the conversion costs
accordingly.
4. Price.
(a) The price to be paid for the Products shall be an amount
equal to the Total Price ($ per lb.) as listed on the attached Exhibit A,
adjusted as may be provided in Paragraphs 4(b) through 4(e) below.
(b) Commodity Items - Price Adjustment. Commodity Items are
listed in Exhibit D and include bagged flour, bagged sugar, eggs, chocolate,
butter, nuts, oil and packaging ("Commodity Items"). Standards for Commodity
Items will be set at the beginning of the year based on a forecasted average
annual cost ("Commodity Standards"). These Commodity Standards will be evaluated
quarterly and adjusted to market conditions. At the end of each quarter, an
average of actual purchases costs paid during the quarter will be tallied
against the standard. If the aggregate for the quarter varies by at least
$50,000 (positively or negatively), the total variance will be applied to raw
material pricing across all
Mrs. Fields Original Cookie Company
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February 12, 1998
products for the next quarterly pricing period. Aggregate amounts less than
$50,000 will be rolled forward and added into the aggregate of the next quarter.
This process will be settled at the end of each calendar year.
Volume (pounds) to be used for allocating the rate of the raw material
variances per quarter for re-pricing will be the minimum volume of 23,000,000
lbs. divided by the four quarters or 5,750,000 lbs. per quarter. (This is to
lessen the volume swings of seasonal business).
(c) Non-Commodity Items - Price Adjustment. Raw material and
packaging costs for non-commodity items will be adjusted by the Seller at the
end of each calendar year and applied to Products purchased in the following
year as follows:
All ingredients and packaging (except for Commodity
Items listed in 4(b)and Exhibit D) shall be adjusted to a standard cost which is
derived by using the last actual cost paid by Seller for the item. This cost
will be used for the subsequent calendar year.
(d) Labor and Energy Costs - Price Adjustment To enable
Seller to cover rising labor and energy costs during the term of this agreement,
Buyer agrees to the following annual increases to total conversion cost on all
manufactured items as follows:
(i) January 1, 1999 - $0.00333 per pound; and
(ii) January 1, 2000 - $0.00333 per pound.
(e) Price Rebates. At the end of each calendar quarter
Seller shall rebate to Buyer $0.071 for each pound of Product sold by Seller
during the calendar quarter. Seller shall rebate an additional $0.02 for each
pound of Product sold in accordance with the attached Schedule A.
Except as to Legacy Brands, Inc., the price under this Paragraph 4
shall not apply to purchases by any of Buyer's franchisees or licensees to the
extent inconsistent with any separate agreement between Seller and any such
franchisee or licensee unless Product can be priced to include any rebate.
5. New Bakery Products. If compatible with the normal operation
of Seller's business, Seller agrees to manufacture any new bakery products
designated as such by Buyer (whereupon they will be deemed "Products" for all
purposes under this agreement) pursuant to the directions, formulations and
recipes communicated by Buyer to Seller. Seller's obligation to supply new
bakery products to Buyer under this Paragraph 5 is subject to agreement between
Buyer and Seller on the initial price to be charged Buyer for the same. For
purposes of computing the price to be paid by Buyer under Paragraph 4, such
initial price shall be deemed to be the price as if listed on attached Exhibit
A. Seller agrees to cooperate and offer reasonable assistance to Buyer in the
development of new bakery products,
Mrs. Fields Original Cookie Company
Page 4
February 12, 1998
provided in each case that Buyer agrees to compensate Seller for costs incurred.
6. Quantities and Orders.
(a) Buyer shall, prior to September 30 of each Calendar year
during the term, furnish Seller with a schedule forecasting monthly estimated
quantities of the specific Products to be purchased by Buyer during the
following calendar year.
(b) Buyer or its designated representative shall submit an
order to Seller on or prior to Wednesday of each week for Products to be
produced by Seller during the following week. Seller may decline to accept any
actual orders for Products during any quarter to the extent that such order
exceeds by more than twenty (20) percent of the amount of Products scheduled for
production during an average production week. Seller reserves the right to
decline any order which is less than a full batch size. Each order submitted by
Buyer for Products shall state that it is submitted pursuant to this Agreement,
shall be transmitted to Seller in writing, and shall include the quantity,
description, and item number of Products ordered, delivery points, delivery
schedules, shipping instructions, and such other information as Seller may
reasonably require. Each order shall be for a minimum of one batch of the
Products ordered, and shipping instructions shall correspond with the regional
delivery schedule provided from time to time by Seller. Seller shall confirm in
writing receipt of each order.
7. Delivery. Seller shall ship Products ordered by Buyer pursuant
to Paragraph 6 (b) hereof such that the Products are delivered to the
destination designated by Buyer by the dates specified for delivery, except that
the date specified for delivery shall be an approximate date for unloading
Products and shall allow for normal transportation delays. Seller shall notify
Buyer in writing of the date on which Products ordered have been shipped and all
related shipping information. Delivery of products shall be C.I.F. the
destination (within the 48 contiguous states) designated by Buyer in the notice
given pursuant to Paragraph 6 (b). Seller shall ship Products in refrigerated
containers at 0 degrees F. or below.
8. Payment The price for the Products shall be payable net cash
within 20 days from the date of invoice or shipment, whichever is earlier. Buyer
or its representative may dispute any invoice in good faith as long as Buyer or
its Representative shall pay all undisputed amounts in a timely manner. Buyer or
its Representative shall pay interest on all overdue accounts at the lessor of
(1) the "Prime Rate" (or any successor rate) as then published in the Wall
Street Journal plus 1% or (ii) the highest applicable legal rate (the "Penalty
Rate").
9. Sale of Products to Others. Seller will not sell or offer to
sell the Products or any bakery items produced from the Licensed Trade Secrets
(as hereinafter defined) or derived therefrom to any persons, entities, or
parties other than Buyer or any Licensee of Buyer. Nothing in this Agreement
shall be construed to limited Seller's right to sell to other customers items
which are of a similar type to the Products but which do not use the Licensed
Trade Secrets in their manufacture, production, formulation, or otherwise.
Mrs. Fields Original Cookie Company
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February 12,1998
10. Purchase of Supplies. If Seller acquires raw materials or
supplies which are unique to the production of Products and which are not
customarily used in the production of other bakery items by Seller (the
"Supplies'), and the Supplies are not used in the production of Products ordered
by Buyer during the shelf life of the Supplies, and the Supplies cannot be used
by Seller in the manufacture of other bakery items in the normal course of
Seller's business, Buyer shall pay to Seller the actual costs of the Supplies
not used by Seller and all expenses incurred by Seller in the storage and any
disposal thereof. In addition, if Seller has produced Products to fill an order
received from Buyer pursuant to Paragraph 6 (b) hereof, and Buyer does not call
for delivery of the same before the expiration of the shelf life thereof, Seller
shall destroy the same and invoice Buyer for the price with respect thereto.
11. Duty To Examine. Upon receipt of the Products at their
destination, Buyer shall examine the Products for impurities, damage, spoilage,
and any and all other defects to such Products. Promptly upon discovery thereof
by Buyer, but in any event not later than thirty (30) days after receipt, Buyer
shall notify Seller of any products which are damaged, defective, opened or
improperly packaged. If Buyer has previously paid for defective Products, Buyer
shall be entitled to a refund of the portion of the Price attributable to such
defective Products within ten (10) days after the notice of the defect, unless
the same is disputed by Seller in good faith, except that if the amount to be
refunded does not exceed $1,000, such amount shall be a credit against the next
invoice. Seller shall pay Buyer interest on all overdue accounts calculated at
the Penalty Rate. If requested by Seller, Buyer shall promptly return defective
Products to Seller at Seller's expense. Buyer further agrees to take reasonable
steps at Seller's expense, for a period not to exceed ten (10) days after notice
to Seller of the defect, to preserve the rejected Products pending Seller's
instructions.
12. Replacement of Damaged Goods. If Seller discovers, upon
examination pursuant to Paragraph 11 hereof, that any of the Products delivered
to Buyer are spoiled, damaged or otherwise defective, Buyer shall have the right
to require Seller to replace such defective Products, provided that at least
five (5) percent (by price) of the total shipment of Products is spoiled,
damaged or otherwise defective. If Buyer so elects to have such Products
replaced, the shipment of any replacement products will have priority over
shipments by Seller to other customers of Seller, and will be effected within
seventy-two (72) hours (or three working days, if later). Seller shall, if
requested by Buyer, cause such replacement Products to be delivered to Buyer, at
Seller's expense, by the most rapid means of commercially feasible ground
transportation available.
13. Rotation of Finished Products. Seller agrees to rotate all
finished Products stored by Seller after production on a "first in-first out"
basis.
14. License. For purposes of this Agreement, "Licensed Trade
Secrets" means all transferable techniques, processes, methods of production and
know-how uniquely pertaining to and necessary for use in relation to the
formulation, composition and production of Products. Information which was
already in the possession of Seller, but which was not obtained in connection
with this transaction or past transactions with Buyer, or information which is
or becomes publicly available without breach of (i) this Agreement, (ii) any
agreement or instrument with Buyer to which Seller is a
Mrs. Fields Original Cookie Company
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February 12,1998
party or beneficiary, or (iii) any duty owed Buyer by Seller or any other
subsidiary of Seller, shall be excluded from the definition of Licensed Trade
Secrets. Buyer hereby grants to Seller, and Seller accepts from Buyer, a
non-exclusive license to employ the Licensed Trade Secrets solely for the
purpose of producing the Products for sale to Buyer and Licensees of Buyer.
15. Confidentiality. Seller understands that the Licensed Trade
Secrets disclosed to Seller under this agreement are secret, proprietary and of
value to Buyer, which value may be impaired if the secrecy of such information
is not maintained. Seller will take reasonable security measures to preserve and
protect the secrecy of the Licensed Trade Secrets. Seller agrees to hold the
Licensed Trade Secrets in confidence and not to disclose any of the Licensed
Trade Secrets, either directly or indirectly, to any person or entity, including
any subsidiary or affiliate of Seller (or any director, officer, or employee
thereof) during the term of this agreement or at any time within five (5) years
following the expiration or termination hereof, except that Seller may disclose
the Licensed Trade Secrets to its key officers and employees to whom disclosure
is necessary for the manufacture of the Products pursuant to this agreement.
Seller shall exercise such other reasonable precautions to protect and safeguard
the secrecy of the Licensed Trade Secrets except that Seller shall not be
required to employ any more stringent measures than it employs in connection
with protection of its own confidential information.
16. Representations and Warranties of Seller. Seller represents,
warrants and agrees as follows:
(a) Conformity with Specifications. The Products will be
manufactured strictly in accordance with the standards, procedures,
specifications, formulations and recipes from time to time reasonably
established by Buyer. If at any time Buyer deems the quality of the Products to
be below such standards, Buyer may so notify Seller in writing, and Seller will
immediately bring such substandard Products up to the quality standards required
by this agreement. Buyer's right to oversee the quality of the Products shall
not in any way replace, supersede, or substitute for the quality control
required to be exercised by Seller hereunder. The exercise of any action of
quality control by Buyer shall be for its sole and exclusive benefit. If at any
time Seller adapts or modifies the Products in accordance with a request from
Buyer, Seller will produce and manufacture such alternate or modified Products
using the same quality control standards and procedures with respect to such
Products as Seller is required to observe in the manufacture of the Products.
(b) Compliance with Law. Seller will manufacture the
Products in compliance with all applicable federal, state and local laws or
regulations to which Seller is subject, except that Seller shall not be liable
to Buyer for any violation of any such laws or regulations if arising from the
adherence by Seller to the instructions of Buyer.
17. Indemnification.
(a) Seller agrees to indemnify and hold Buyer harmless from
and against any and all demands, liabilities, damages, expenses, causes of
action, suits, claims or judgments (including
Mrs. Fields Original Cookie Company
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February 12, 1998
reasonable attorneys' fees) arising out of or in connection with (i) any damage
to property, injuries, illness or loss of life which occur on account of, or in
connection with the use or consumption of Products which were defective in
condition, quality or purity as of delivery to Buyer, whether such condition was
discovered at the time of delivery or at a later date, and (ii) any default by
Seller in the observation or performance of its covenants and agreements
contained herein. Buyer agrees to indemnify and hold Seller harmless from and
against any and all demands, liabilities, damages, expenses, causes of actions,
suits or judgments (including reasonable attorneys' fees) arising out of or in
connection with (i) the sale, distribution, handling or misuse of the Products
after delivery to Buyer except to the extent to which Buyer is indemnified by
Seller under this Paragraph 17, and (ii) any default by Buyer in the observance,
payment or performance of its covenants and agreements contained herein. Any
amounts payable by one party to the other pursuant to this Paragraph 17 shall be
limited to actual damages, and shall not include any amounts attributable to
incidental or consequential damages.
(b) Buyer represents to Seller that it has made and will
continue to make all required disclosures to its franchisees concerning rebates
or other payments by Seller to Buyer or its affiliates, and Buyer agrees to
defend, indemnify and hold Seller harmless from any claims, liabilities, or
damages, including attorneys' fees, arising out of any breach by Buyer of this
representation.
18. Termination.
(a) Seller's Rights. Seller, at its option, shall have the
right by notice to Buyer, in addition to any other remedy available at law, in
equity or pursuant to this agreement (including but not limited to an
injunction, specific performance and damages) to suspend or terminate Buyers
right to purchase, and Sellers obligation to supply Buyer with Products and any
other future right of Buyer pursuant to this agreement upon the happening and
during the continuance of any one or more of the following events:
(i) Buyer fails to pay any amount owing to
Seller hereunder within thirty (30) days from the date Buyer receives notice of
a default hereunder; and
(ii) Buyer defaults in the performance of any
other term, covenant,agreement or condition of this agreement and if within
sixty (60) days after notice from Seller describing the specific activities
constituting such default, Buyer shall fail to cure default, or if such default
cannot be cured with the exercise of due diligence within said sixty (60) day
period, shall fail thereafter to proceed to cure the same diligently and in
good faith, and in any case, to cure such default within one hundred-twenty
(120) days.
(b) Buyer's Rights. Buyer, at its option, shall have
the right by notice to Seller, in addition to any other remedy available by law,
in equity or pursuant to this agreement (including but not limited to the right
to an injunction, specific performance and damages) to terminate Buyers
obligation to purchase Products from Seller, and any other future right of
Seller pursuant to this agreement, if Seller defaults in the performance of any
material term, covenant, agreement or condition of this agreement, and if within
sixty (60) days after notice from Buyer describing the specific activities
Mrs. Fields Original Cookie Company
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February 12, 1998
constituting such default, Seller shall fail to cure the default, or if such
default cannot be cured with the exercise of due diligence within a sixty (60)
day period, shall fail thereafter to proceed to cure the same diligently and in
good faith, and in any case, to cure such default within one hundred-twenty
(120) days;
(c) Remaining Obligations. The termination of this agreement
by either party pursuant to this Paragraph 18 shall not relieve (i) either party
of its obligation to pay all such sums owed to the other hereunder, (ii) Seller
of its obligation of confidentiality under Paragraph 16, and (iii) either party
of its respective obligations of indemnity contained herein.
19. Assignment. Buyer and Seller may, without the consent of the
other party, with notice to the other party, assign its rights and obligations
hereunder to a related entity, but shall remain liable therefor. For purposes of
this Paragraph 19, the term "related entity." shall mean any corporation,
partnership or joint venture which is fifty percent (5 0%) or more owned by
Buyer or Seller, as the case may be. Except as provided in this Paragraph 19,
Buyer and Seller may not assign their rights or obligations hereunder without
the prior written consent of the other party. Subject to the foregoing
limitation, all the terms and provisions of this agreement shall be binding
upon, and shall inure to the benefit of, the successors in interest or the
assigns of the parties hereto with the same effect as is mentioned in each
instance, or the party hereto is named or referred to, except that no
assignment, transfer, pledge or mortgage and violation of the provisions of this
agreement shall vest any rights and any assignee, transferee, pledgee, or
mortgagee.
20. Miscellaneous.
(a) Force Majeure. Neither party shall be deemed to be in
default under this agreement because of delays or inability to perform
occasioned by war, civil disturbance, strikes, boycotts, lock-outs, shortages,
transportation and communication problems, natural calamities such as fire,
flood, earthquake, storm, acts of God, governmental regulations or actions,
inability to obtain labor or materials from usual sources of supply, or. other
means beyond the parties' control (a "Force Majeure Event"). In case of a Force
Majeure Event affecting production of Products by Seller, (i) deliveries of
Products by Seller hereunder shall be allocated among Buyer and Seller's other
customers on a fair and reasonable basis and (ii) (a) Buyer's minimum annual
purchase obligation under paragraph I shall be reduced, for each month (or
fraction thereof that such Force Majeure Event continues, by an amount that
represents Buyer's monthly average purchases of Products during the preceding
twelve (12) months under this (or a predecessor) agreement; and (b) the amount
by which Buyer's minimum annual purchase obligation is decreased under clause
(a) of this subparagraph (ii) shall be added to the amount of Products actually
purchased by Buyer for purposes of determining any rebates due Buyer or
penalties payable by Buyer under paragraphs 2(a) or 2(b), respectively.
(b) Headings. Headings in this agreement are included for
convenience of reference only, and shall not constitute a part of this agreement
for any other purpose.
Mrs. Fields Original Cookie Company
Page 9
February 12, 1998
(c) Notices. All notices provided by this agreement shall be
in writing and shall be given by facsimile transmission with the copy thereof
mailed by first class mail, postage prepaid, or by personal delivery, by one
party to the other, addressed to such other party at the applicable address set
forth, or to such other address as may be given for such purpose by such other
party by notice duly given hereunder. Notice shall be deemed properly given on
the date of facsimile transmission or on the date of delivery whichever applies.
To order Products:
Pennant Foods
2200 Cabot Drive
Suite 100
Lisle, Illinois 60532
Facsimile No.: (630) 955-5532
For all other Purposes:
LBI Acquisition Corp.
100 Northfield Street
Greenwich, Connecticut 06830
Facsimile No.: (203) 622-6976
Attention: Thomas C. Ewing
Mrs. Fields Original Cookie Company
462 West Bearcat Drive
Salt Lake City, Utah 84115
Facsimile No.: (801) 463-2223
(d) Applicable Law. This agreement shall be construed and
enforced in accordance with, and governed by the laws of the State of
Connecticut.
(e) Integration. This agreement represents the only
agreement and understanding between the parties and their affiliates with
respect to the subject matter hereof, and supersedes all prior negotiations,
representations and agreements made by the parties and their affiliates with
respect to the subject matter hereof. This agreement may be amended,
supplemented or changed, and any provision hereof waived, only by a written
instrument making specific reference to this agreement signed by the party
against whom enforcement of any such amendment, supplement or change or waiver
is sought. Waiver by either party of any breach or default hereunder by the
other party shall not operate as a waiver of any other breach or default,
whether similar to or different from the breach or default waived.
(f) 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 of the same agreement,
binding upon all parties thereto, notwithstanding that all parties are not
signatories to the original or the same counterpart.
Mrs. Fields Original Cookie Company
Page 10
February 12, 1998
(g) Severability. In the event any provision of this
agreement is found to be unenforceable or invalid, such provision shall be
severable from this agreement if it is capable of being identified with and
apportioned to reciprocal consideration or to the extent it is a provision which
is not essential and the absence of which would not have prevented the parties
from entering into this agreement. The unenforceability or invalidity of a
provision which has been performed shall not be grounds for invalidation of this
agreement under circumstances in which the true controversy between the parties
does not involve any such provision.
(h) Extension. This agreement may be extended beyond the
term upon such terms and conditions as the parties shall agree upon in writing.
If the foregoing accurately reflects our agreement, please so indicate
by having the original of this letter signed in the spaces provided below and
returning it to me; a copy is enclosed for your files.
Very truly yours,
LBI Acquisition Corp.
d/b/a Pennant Foods
By /s/ Gerald W. Hanna
Its: President
AGREED TO AND ACCEPTED.
MRS. FIELDS ORIGINAL COOKIE COMPANY
By: /s/ Larry A. Hodges
Its:
January 1, 1998
Raw MFC
Materials Total Req. Total
PROD & Packaging Conversion Add on Price
# DESCRIPTION ($ per lb.) ($ per lb.) ($ per lb.) ($ per lb.)
- --------------------------------------------------------------------------------------------------------------------
1553 MFC P.B. FILLING 0.7836 0.3340 0.0200 1.1376
1560 MFC BRAN MUFFIN 05 LB CHUB 0.6130 0.3005 0.0200 0.9334
1561 MFC ORANGE MFFN 05 LB CHUB 0.7463 0.3411 0.0200 1.1074
1563 MFC CORN MUFN 4X5 LB CHUB 0.5399 0.3031 0.0200 0.8630
1564 MFC PLAIN MUFN BATTR 05 CHUB 0.5520 0.2852 0.0200 0.8572
1565 MFC PUMPKIN MFN 05 CHUB 0.7470 0.3193 0.0200 1.0863
1666 MFC BANANA NUT MUFFIN 4X5 CHUB 0.8095 0.3067 0.0200 1.1362
2910 MFC DOUBLE FUDGE BROWNIE 0.6986 0.2738 0.0200 0.9924
2911 MFC WALNUT FUDGE BROWNIE 0.7522 0.2738 0.0200 1.0460
2912 MFC PECAN FUDGE BROWNIE 0.7523 0.2738 0.0200 1.0461
2913 MFC MACADAMIA FUDGE BROWNIE 0.8702 0.2738 0.0200 1.1640
2915 MFC PECAN PIE BROWNIE 0.8004 0,2792 0.0200 1.0997
3050 MFC CHOC CHIP COOKIE 0.6935 0,3342 0.0200 1.0477
3052 MFC MILK CHOC CHIP COOKIE 0.7035 0.3346 0,0200 1.0581
3054 MFC BUTTER TOFFEE COOKIE 0.8291 0.3252 0.0200 1.1743
3060 MFC BUTTER COOKIE 0.5663 0.3321 0.0200 0.9184
3061 MFC CHOC CHIP WALNUT COOKIE 0.8121 0.3297 0.0200 1.1618
3062 MFC WHITE CHUNK W/MAC COOKIE 1.1317 0.3288 0.0200 1.4805
3063 MFC COCO MAC COOKIE 1.1847 0.3435 0.0200 1.5482
3064 MFC TRIPLE CHOC COOKIE 0.7337 0.3346 0.0200 1.0883
3065 MFC OATMEAL RAISIN NUT COOKIE 0.7472 0.3449 0.0200 1.112l
3069 MFC MLK CHOC W/WALNT COOKIE 0.8262 0.3313 0.0200 1.1775
3075 MFC PEANUT BUTTER COOKIE 0.6185 0.3442 0.0200 0.9827
3079 MFC CHEWY CHOC COOKIE 0.7936 0.3268 0,0200 1.1404
3091 MFC MLK CHC CHP W/MC COOKIE 1.1146 0.3312 0.0200 1.4658
6350 MFC CHOCOLATE CHIP "COOKIE DOUGH" 0.6900 0,3342 0.0200 1.0442
6352 MFC MILK CHOCOLATE CHIP "COOKIE DOUGH" 0.7000 0.3346 0.0200 1.0546
6354 MFC BUTTER TOFFEE "COOKIE DOUGH" 0.8256 0.3252 0.0200 1.1708
6358 MFC PUMPKIN HARVEST "COOKIE DOUGH" 0.8401 0.3451 0.0200 1.2052
6360 MFC BUTTER "COOKIE DOUGH" 0.5628 0.3321 0.0200 0.9149
6361 MFC CHOCOLATE CHIP WALNUT COOKIE DOUGH" 0.8086 0.3297 0.0200 1.1583
6362 MFC WHITE CHUNK MAC. NUT COOKIE DOUGH" 1.1170 0.3288 0.0200 1.4658
6363 MFC COCNUT MAC. NUT "COOKIE DOUGH" 1.1693 0.3435 0.0200 1.5328
6364 MFC TRIPLE CHOCOLATE "COOKIE DOUGH" 0.7243 0.3346 0.0200 1.0789
6365 MFC OATMEAL RAISIN W/NUTS "COOKIE DOUGH" 0.7438 0.3449 0.0200 1.1087
6369 MFC MILK CHOCOLATE WALNUT "COOKIE DOUGH" 0.8145 0.3313 0.0200 1.1658
6375 MFC PEANUT BUTTER COOKIE DOUGH" 0.6150 0.3442 0.0200 0.9792
6379 MFC CHEWY CHOCOLATE FUDGE "COOKIE DOUGH" 0.7901 0.3268 0.0200 1.1369
6391 MFC MILK CHOCOLATE MAC NUT COOKIE DOUGH" 1.1000 0,3312 0.0200 1.4512
6392 MFC SEMI-SWEET CHUNK PECAN COOKIE DOUGH" 0.7933 0.3318 0.0200 1.1451
6650 MFC CHOCOLATE CHIP NIB COOKIE 0.6837 0.3348 0.0200 1.0385
6652 MFC MILK CHOCOLATE CHIP NIB COOKIE 0.7056 0.3348 0.0200 1.0604
6660 MFC BUTTER NIB COOKIE 0.5726 0.3417 0.0200 0.9343
January 1, 1998
Raw MFC
Materials Total Req. Total
PROD & Packaging Conversion Add on Price
# DESCRIPTION ($ per lb.) ($ per lb.) ($ per lb.) ($ per lb.)
- -------------------------------------------------------------------------------------------------------------------
6662 MFC WHITE CHUNK MAC. NUT NIB COOKIE 1.0912 0.3283 0.0200 1.4395
6665 MFC OATMEAL RAISIN NIB COOKIE W/NUTS 0.7248 0.3451 0.0200 1.0899
6669 MFC MILK CHOCOLATE WALNUT NIB COOKIE 0.8278 0.3313 0.0200 1.1791
6675 MFC PEANUT BUTTER NIB COOKIE 0.6166 0.3537 0.0200 0.9903
7010 MFC MFC CASHEW FUDGE BROWNIE (INTL) 0.8137 0.3411 0.0200 1.1749
7030 MFC MFC DBLE FUDGE CHOC MUFFIN (INTL) 0.6363 0.3411 0.0200 0.9974
7050 MFC CHOC CHIP COOKIE (INTL) 0.6933 0.3342 0.0200 1.0475
7051 MFC WHITE CHIP COOKIE (INTL) 0.6749 0.3346 0.0200 1.0295
7052 MFC MILK CHOC COOKIE (INTL) 0.7033 0.3346 0.0200 1.0579
7054 MFC MFC BUTTER TOFFEE (INTL) 0.8298 0.3252 0.0200 1.1750
7060 MFC BUTTER COOKIE (INTL) 0.5661 0.3321 0.0200 0.9182
7062 MFC WHT CHK MAC COOK (INTL) 1.1369 0,3288 0.0200 1.4857
7063 MFC COCO/MACNUT COOK (INTL) 1.1845 0.3435 0.0200 1.5480
7064 MFC TRIPLE CHOC COOK (INTL) 0.7365 0.3346 0.0200 1.0911
7065 MFC OATM RAISIN COOK (INTL) 0.7470 0.3449 0.0200 1.1119
7066 MFC CC WLNT COOKIE (INTL) 0.1819 0.3297 0.0200 1.1616
7079 MFC CHEWY CHOC COOK (INTL) 0.7934 0.3268 0.0200 1.1402
7091 MFC CC MAC NUT COOKIE (INTL) 1.1144 0.3312 0.0200 1.4656
7092 MFC SS CHNK PEC COOK (INTL) 0.8045 0.3318 0.0200 1.1563
7094 MFC MFC MILK CHOC CHIP W/CASHEW (INTL) 0.9959 0.3422 0.0200 1.3581
7203 MFC SWEET FRENCH ROLLS 0.1206 0.3192 0.0200 0.4598
7401 MFC APPLE CROISSANT 0.5423 0.3484 0.0200 0.9107
7403 MFC BUTTER CROISSANT 0.5193 0.3704 0,0200 0.9097
7404 MFC CHOCOLATE CROISSANT 0.6932 0.3616 0.0200 1.0748
7410 MFC CHEESE CROISSANT 0.8415 0.3720 0.0200 1.2334
7447 MFC BUTTER COOKIE SHEETS 0.6527 0.3616 0.0200 1.0343
7450 MFC CINNAMON ROLL 0.2914 0.3596 0.0200 0.6710
7500 MFC EGG TWIST 0.1831 0.3052 0.0200 0.5083
7501 MFC NINE GRAIN 0.2048 0.2738 0.0200 0.4986
7503 MFC RAISIN NUT 0.4450 0.2744 0.0200 0.7394
7505 MFC RYE REGULAR 0.1794 0.2796 0,0200 0.4790
7506 MFC HONEYWHEAT BERRY 0.2487 0.2773 0.0200 0.5459
7552 MFC NEW SWT BAGT 0.1344 0.2779 0.0200 0.4323
7553 MFC NEW SWEET REGULAR 0.1317 0.2728 0.0200 0.4245
7570 MFC SOUR FRENCH REGULAR BREAD 0.1647 0.2828 0.0200 0.4675
7750 MFC ALMOND PASTE 1.3325 0.3102 0.0200 1.6627
7751 MFC MAPLE TOPPING 0.4044 0.2872 0.0200 0.7115
7754 MFC NEW STREUSEL 0.5302 0.2683 0.0200 0.8184
7782 MFC BUTTERCREME ICING 0.7123 0.3067 0.0200 1.0390
33330 INGR BULK PECANS (10 lbs.) 2.0000 0.1958 0.0200 2.2158
33332 INGR BULK FROZEN RASPBERRIES 1.4500 0.1958 0.0200 1.6658
33333 INGR BULK MACADAMIA NUTS 4.7100 0.1958 0.0200 4.9258
33334 INGR BULK FROZEN BLUEBERRIES 1.2800 0.1958 0.0200 1.4958
33335 INGR BULK SEMI SWEET CHOC CHIPS 0.9290 0,1958 0.0200 1.1448
January 1, 1998
Raw MFC
Materials Total Req. Total
PROD & Packaging Conversion Add on Price
# DESCRIPTION ($ per lb.) ($ per lb.) ($ per lb.) ($ per lb.)
- --------------------------------------------------------------------------------------------------------------------
33336 INGR BULK MILK CHOC CHIPS 0.9500 0.1958 0.0200 1.1658
33337 INGR BULK WALNUTS 2.1700 0.1958 0.0200 2.3858
33338 INGR BULKPECANS 2.0000 0.1958 0.0200 2.2158
33339 INGR BULK WHITE CHUNK CHOC CHIPS 0.8510 0.1958 0.0200 1.0668
64101 OCC OLD FASHION CHOC. CHIP COOKIE DOUGH 0.5353 0.3383 0.0200 0.8936
64102 OCC OLD FASHION CHOC. PECAN COOKIE DOUGH 0.7122 0.3383 0.0200 1.0705
64105 OCC OLD FASHION SUGAR BUTTER COOKIE DOUGH 0.4395 0.3383 0.0200 0.7978
64106 OCC OLD FASHION PEANUT BUTTER COOKIE DOUGH 0.5400 0.3383 0.0200 0.8983
64107 OCC OLD FASHION OATMEAL RAISIN COOKE DOUGH 0.4398 0.3383 0,0200 0.7981
64114 OCC OLD FASHION DOUBLE CHOC. COOKIE DOUGH 0.5429 0.3383 0.0200 0.9012
64119 OCC OLD FASHION GINGER SNAPS COOKIE DOUGH 0.5631 0.3383 0.0200 0.9214
64122 OCC OLD FASHION BTTRSCTCH OATML COOKIE DO 0.4988 0.3383 0.0200 0.8571
64201 OCC BITE SIZE CHOC. CHIP COOKIE DOUGH 0.5363 0.3383 0.0200 0.8946
64202 OCC BITE SIZE CHOC. PECAN COOKIE DOUGH 0.7207 0.3383 0.0200 1.0790
64206 OCC BITE SIZE PEANUT BUTTER COOKIE DOUGH 0.5352 0.3383 0,0200 0.8935
64207 OCC SITE SIZE OATMEAL COOKIE DOUGH 0.4482 0.3383 0.0200 0.8065
64214 OCC BITE SIZE DOUBLE CHOC. COOKIE DOUGH 0.5428 0.3383 0.0200 0.9011
64223 OCC SITE SIZE SUGAR M&M COOKIE DOUGH 0.8262 0.3383 0.0200 1.1845
64275 OCC BITE SIZE BUTTER COOKIE DOUGH 0.7462 0.3383 0.0200 1.1045
Exhibit B
Rebate to Buyer
Annual Volume Rebate
(000's lbs.) ($ per lb.)
----------------- -----------
23,000 or less 0.0000
23,001 - 24,999 0.0100
25,000 - 26,999 0.0125
27,000 - 28,999 0.0150
29,000 - or more 0.0175
Exhibit C
Penalty Payment by Buyer
Annual Volume Penalty
(QOQ's ) ($ per lb.)
---------------- -----------
23,000 - + 0.0000
21,000 - 21,999 0.0025
19,000 - 20,999 0.0050
17,000 - 18,999 0.0075
15,000 - 16,999 0.0100
13,000 - 14,999 0.0125
11,000 - 12,999 0.0150
9,000 - 10,999 0.0175
7,000 - 8,999 0.0200
5,000 - 6,999 0.0225
3,000 - 4,999 0.0250
1,000 - 2,999 0.0275
0 - 999 0.0300
Exhibit D
Commodity Items
Butter
Chocolate
Eggs
Flour (bagged)
Milk / Milk Products
Nuts (Including but not limited to)
Macadamia Nuts
Pecans
Walnuts
Raisins
Shortening / Oils
Sugar(bagged)
Packaging
Corrugated
Roll Stock Film