The Pantry Enters New Branded-Jobber Contract with BP Products
On January 7, 2013, The Pantry, Inc. (NASDAQ: PTRY) entered into a Branded Jobber Contract (the “Agreement”) with BP® Products North America Inc. (“BP”). The Agreement supersedes and replaces the original Branded Jobber Contract dated February 1, 2003, as amended, between the Company and BP (the “Original Agreement”). Notwithstanding the recent extension of the Original Agreement to January 31, 2013, as discussed in Item 1.02 below, the effective date of the Agreement is January 1, 2013.
The Agreement provides for BP to supply, and the Company to purchase, certain minimum amounts of motor fuel for the Company's specified convenience store locations. The Agreement initially relates to 394 BP branded outlets with provisions pursuant to which locations may be added to or removed from the Agreement during the term of the Agreement for specified reasons. The prices provided for in the Agreement are based upon industry indexes. If the Company fails to purchase its annual minimum contract volume, BP may charge the Company a shortfall penalty of $.02 per gallon times the difference between the number of gallons purchased and the minimum volume requirement. The term of the Agreement expires on December 31, 2019.
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