Sep 10 2004
Landec Corporation, a developer and marketer of technology-based polymer products for food, agricultural and licensed partner applications, and Chiquita Brands International, Inc. announced today that Landec's food subsidiary, Apio, Inc., has entered into a joint technology development and supply agreement with Chiquita to provide Landec's patented Intelimer(R) packaging technology for Chiquita bananas.
"This agreement is the culmination of several years of market trials to successfully validate our proprietary Intelimer packaging technology with bananas and its value in the marketplace," said Gary Steele, Landec's Chairman and Chief Executive Officer. "We are pleased that Chiquita recognizes the unique properties of our Intelimer technology and plans to use our packaging technology to add value to its banana products globally."
"We have been evaluating the Intelimer packaging technology for bananas for two years and, based on the results, we believe this product will effectively extend the shelf life of bananas, which offers a significant benefit to our customers and consumers," said Fernando Aguirre, Chiquita's Chairman and Chief Executive Officer.
Under the long-term agreement, Apio will supply Chiquita with its proprietary Intelimer banana packaging technology on a worldwide basis for the ripening, conservation and shelf-life extension of bananas in selective applications on an exclusive basis and for other applications on a non-exclusive basis. In addition, Apio will provide Chiquita with ongoing research and development, process technology support for the Intelimer membranes and bags, and technical service support throughout the customer chain in order to assist in the development and market acceptance of the technology.
For its part, Chiquita will provide marketing, distribution and retail sales support for Chiquita bananas sold worldwide in Intelimer packaging. To maintain the exclusive license, Chiquita must meet minimum purchase thresholds of Intelimer-based banana packages. Commercial shipments of Chiquita products utilizing Landec's Intelimer packaging are scheduled to begin in early 2005.
Chiquita and Landec have also agreed to work together to exploit the Intelimer packaging technology for other novel packaging applications using Chiquita bananas.
In addition, the two companies entered into a stock purchase agreement, whereby Landec will sell to Chiquita up to 500,000 shares of Landec common stock. The actual number and purchase price of the shares to be sold will be determined by an agreed formula based on the weighted average daily closing price of Landec's stock over the next 20 trading days.
"This agreement is consistent with our stated goals to expand the use of our proprietary technology and begin commercial sales of our Intelimer packaging technology for bananas during the second half of fiscal year 2005," Steele said. "This is a milestone for Landec's proprietary banana packaging program. We have invested considerable efforts over the past three years in developing a variety of proprietary packaging products to extend the shelf life of bananas. We are now positioned to capitalize on our investments in research and development, manufacturing and market research for banana packaging technology through this agreement."
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