The Pantry, McLane Renew Distribution Deal
C-store chain, wholesaler extend 2008 agreement through 2019
CARY, N.C. -- The Pantry Inc. has entered into a new distribution service agreement with McLane Co. Inc., the convenience store retailer said in a filing with the U.S. Securities & Exchange Commission (SEC).
The deal, which will become effective upon the implementation of certain internal system changes required by McLane, will replace their 2008 distribution service agreement.
The companies expect the new agreement to be effective in early May 2014, and it will remain in effect until Dec. 31, 2019, unless terminated sooner in accordance with its terms.
Subject to specified exceptions, the agreement provides for the company's continued purchase from McLane of the company's requirements for all categories of food and nonfood general merchandise products, including cigarettes and tobacco products, offered by McLane and customarily supplied by convenience food wholesalers.
The agreement contains provisions relating to product ordering and delivery, price and payment terms, service standards that must be satisfied by McLane and default and other provisions customarily contained in supply agreements.
The company purchased 56% of its merchandise, including most grocery and tobacco products, from McLane during fiscal 2013, and the companies do not expect that percentage to change materially under the revised agreement, they said.
McLane is a $44 billion supply chain services leader, providing grocery and foodservice supply chain solutions for convenience stores, mass merchants, drug stores and chain restaurants throughout the United States. McLane, through McLane Grocery, McLane Foodservice and Meadowbrook Meat Co. Inc., operates 80 distribution centers and one of the nation's largest private fleets. The company buys, sells and delivers more than 50,000 different consumer products to nearly 90,000 locations across the United States. In addition, McLane provides alcoholic beverage distribution via McLane Beverage Distribution Inc., and its acquisitions of Empire Distributors, Inc., Horizon Wine & Spirits and Delta. McLane is a wholly owned unit of Berkshire Hathaway Inc., Omaha, Neb.
Based in Cary, N.C., The Pantry is a leading independently operated convenience store chain in the southeastern United States and one of the largest independently operated convenience store chains in the country. As of March 13, 2014, the company operated 1,537 stores in 13 states under select banners, including Kangaroo Express, its primary operating banner.