Exhibit 10.1
EXECUTION COPY
THIRD AMENDMENT TO EXECUTIVE EMPLOYMENT AGREEMENT
     THIS THIRD AMENDMENT TO EXECUTIVE EMPLOYMENT AGREEMENT (this “Amendment”)
is made and entered into as of November 16, 2005, by and among Swift Foods
Company, a Delaware corporation (the “Company”), and Danny Herron (“Executive”).
RECITALS
     WHEREAS, the Company and Executive are parties to the Executive Employment
Agreement, dated May 20, 2002, as amended by that certain First Amendment to
Executive Employment Agreement, dated July 12, 2002, and that certain Second
Amendment to Executive Employment Agreement, dated November 3, 2004, each as
attached hereto as Exhibit A (as so amended, the “Employment Agreement”);
     WHEREAS, capitalized terms used herein but not defined herein shall have
the meanings assigned to them in the Employment Agreement; and
     WHEREAS, because the parties have mutually determined that Executive’s
employment with the Company and its affiliates should be terminated, Executive
has announced his intention to resign his employment with the Company and its
affiliates, and in contemplation of Executive’s termination of employment with
the Company and its affiliates, the Employment Agreement is being amended to
reflect certain agreements regarding such termination and Executive’s
post-termination role with the Company.
AGREEMENT
     NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, and intending to be legally bound,
the parties hereto agree as follows:
1. Transition Period; Termination of Employment. The parties hereby represent
and warrant that prior to the Termination Date (as defined below), Executive’s
employment relationship with the Company and its affiliates was pursuant to and
governed solely by the Employment Agreement. In consideration of the benefits to
be received by Executive pursuant to the terms of this Amendment, Executive
agrees to continue to serve as the Company’s Chief Financial Officer and to
perform the duties associated with such position as provided in the Employment
Agreement until the earlier of (a) the date on which a permanent successor to
Executive reports for employment with the Company in Greeley, Colorado or
(b) September 19, 2006 (either such date, the “Termination Date”). In addition,
Executive agrees to provide the Consulting Services (as defined in paragraph 8)
to the Company as requested for a period of 60 days following the Termination
Date (the last day of such 60-day period, the “Consulting Termination Date”) in
accordance with the provisions of paragraph 8. In addition, effective as of the
Termination Date, any and all of Executive’s other appointments and positions
(including positions as a director) that he may hold with the Company or any of
its affiliates shall be terminated. Executive agrees to execute all further
documents that the Company may reasonably request of him to effectuate such
terminations.

 

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2. Transition Consideration. In consideration of Executive’s agreement to
continue to serve as Chief Financial Officer until the Termination Date and to
provide the Consulting Services to the Company thereafter in accordance with
paragraph 8, the Company shall cause to be paid to Executive the following
consideration:
     (a) Executive shall continue to be paid his current Annual Base Salary in
accordance with the customary payroll practices of the Company until the
Termination Date and provided further that Executive shall be entitled to
receive such compensation for a minimum of 120 days following the date hereof
regardless of whether a successor chief financial officer has been employed by
the Company prior to the end of such 120-day period;
     (b) In consideration of the Consulting Services to be provided in
accordance with paragraph 8, Executive shall be paid his current Annual Base
Salary in accordance with the customary payroll practices of the Company for an
additional 60-day period following the later of (i) the Termination Date or
(ii) the end of the 120-day period referred to in clause (a) above; and
     (c) Until the Consulting Termination Date, Executive shall continue to be
entitled to receive, or participate in, as applicable, all elements and items of
compensation set forth in subparagraph 2(b) of the Employment Agreement,
including without limitation, all Investment Plans, Welfare Plans, perquisites,
vacation days, and expense reimbursement, except that Executive shall not be
entitled to any Bonuses under subparagraph 2(b)(ii) and the Annual Base Salary
shall be paid in the manner set forth in subparagraph 2(a) above.
3. Termination Consideration.
     (a) Cash Payments. In connection with Executive’s termination of
employment, the Company shall cause to be paid to Executive the following
consideration:
          (i) $490,000 payable in two equal lump-sum payments by the close of
business on the third business day following the Reaffirmation Date (as defined
in paragraph 14) and such other date as may be specified by Executive (but in no
event later than January 31, 2007);
          (ii) an amount equal to the full amount of the Accrued Obligations by
the close of business on the third business day following the Reaffirmation
Date, or at the Executive’s option, on the lump-sum payment date(s) specified in
subparagraph (i) above;
          (iii) an amount equal to the Accrued Investments, payable in
accordance with the terms and conditions of the Investment Plans; and
          (iv) if Executive has not accepted employment with another employer by
the date that is 420 days after the Termination Date (the “Severance Completion
Date”), an amount equal to $35,000.00 per month (each, an “Extension Payment”)
payable in accordance with the customary payroll practices of the Company
beginning in the first full month following the Severance Completion Date until
Executive’s acceptance of employment with another employer; provided, however,
that Executive shall not receive more than 6 Extension Payments; and provided,
further, that if Executive accepts employment with another employer prior to the
date

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on which he would have received an Extension Payment in accordance with the
customary payroll practices of the Company, the Extension Payment for that month
shall be prorated based on the number of days elapsed in such month.
     (b) Participation in Medical Insurance Plan. In connection with Executive’s
termination of employment, for a period of 12 months commencing on the
Consulting Termination Date, Executive (and members of his family) shall be
entitled to continue their participation in the Company’s medical insurance plan
(in accordance with the terms of such plan and on the same basis as Executive
participated in such plan immediately prior to the Consulting Termination Date);
provided that Executive shall be responsible for the cost of premiums for
coverage under such plan that would have been payable by Executive had he
remained an employee of the Company during the period of coverage, and the
Company shall be entitled to deduct the amount of such premiums from the amounts
otherwise payable to Executive pursuant to the terms hereof. This period shall
not be credited against any period for which Executive and/or members of his
family are entitled to continuation coverage under Section 4980B of the Internal
Revenue Code of 1986, as amended, and Sections 601-609 of the Employee
Retirement Income Security Act of 1974, as amended.
4. Stock Options.
     (a) General. Executive hereby represents and warrants that, except for the
stock option agreements attached hereto as Exhibit B (the “Option Agreements”),
he is not a party to any stock option, stock appreciation right or similar
agreement granting Executive the right to acquire or benefit from the
appreciation in value of capital stock of the Company or any of its affiliates.
     (b) Vesting. On the day following the Reaffirmation Date (assuming no
revocation of this Amendment by Executive), all of Executive’s options issued
under the Option Agreements and the plans pursuant to which such options were
issued that are not then vested shall be vested in full. Executive shall be
permitted to exercise, in accordance with the terms of the options, any and all
such rights until the earlier of (i) the date the option would otherwise expire
in accordance with its terms, (ii) the 270th day after a Qualifying Public
Offering or (iii) the 90th day after the completion of a merger, combination,
share exchange or similar transaction involving the Company pursuant to which
the securities for which the option is then exercisable are listed on a national
securities exchange or the Nasdaq National Market System or any successor
thereto.
     (c) Consent to Assignment of Executive Options. The Company hereby consents
to the assignment of 312,500 of the Executive Options (September 19, 2002 Grant
Date) to the spouse of Executive in connection with Executive’s marriage
dissolution, subject to the execution and delivery of documentation of such
assignment satisfactory to the Company as contemplated by the Non-Qualified
Stock Option Agreement evidencing such Executive Option and the Company’s 2002
Stock Option Plan. The terms of such Executive Options shall be subject to the
terms of such Non-Qualified Stock Option Agreement, the Company’s 2002 Stock
Option Plan and provisions of this Amendment relating to such Executive Options.

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     (d) Waiver of Purchase Rights. Subject to Executive’s performance of his
obligations under paragraph 2 above, the Company hereby waives any rights to
purchase any Executive Options, any shares of Common Stock of the Company issued
upon the exercise of any Executive Options and any Common Stock of the Company
held by Executive pursuant to the terms of any Executive Options or that certain
Stockholders Agreement dated as of September 19, 2002 among HMTF Rawhide, L.P.,
ConAgra Foods, Inc., Hicks, Muse, Tate & Furst Incorporated, the Company and the
other individuals named therein, as amended (the “Stockholders Agreement”).
5. Taxes. The payments to Executive hereunder shall be subject to applicable
federal, state and local withholding taxes. Executive agrees that, to the extent
that any individual federal or state taxes of any kind may be due as a result of
any such payment to Executive, Executive shall be solely responsible for such
taxes and will indemnify, defend, and hold harmless the Company in the event
there is any claim against the Company for such taxes.
6. General Release. The Company’s obligations under paragraph 3 are subject to
the execution, delivery and non-revocation of a General Release in the form
attached as Exhibit C (the “Release”).
7. Cooperation. Executive agrees to cooperate with the Company as reasonably
requested by the Company by responding to questions, attending depositions,
administrative proceedings and court hearings, executing documents, and
cooperating with the Company and its accountants and legal counsel with respect
to legal and intellectual property matters, business issues, and/or claims,
administrative or arbitral proceedings and litigation of which he has or is
believed to have personal or corporate knowledge. Executive further agrees,
except as required by subpoena or other applicable legal process (after the
Company has been given reasonable notice and opportunity to seek relief from
such subpoena or other legal process), to maintain, in strict confidence, any
information of which he has knowledge regarding current and/or future claims,
administrative or arbitral proceedings and litigation. Executive agrees, except
as required by subpoena or other applicable legal process (after the Company has
been given reasonable notice and opportunity to seek relief from such
requirement), not to communicate with any party(ies), their legal counsel or
others adverse to the Company in any such claims, administrative or arbitral
proceedings or litigation except through the Company’s designated legal counsel.
Executive also shall make himself available at reasonable times and upon
reasonable notice to answer questions or provide other information within his
possession and requested by the Company relating to the Company, its affiliates
and/or their respective operations in order to facilitate the smooth transition
of Executive’s duties to his successor.
8. Consulting Arrangement.
     (a) Consulting Services. Effective as of the Termination Date the Company
hereby retains Executive to render such transitional consulting and advisory
services (the “Consulting Services”) as the Company may reasonably request from
time to time during the Consulting Period (as defined in paragraph 8(b))
concerning all aspects of the Company’s business, including, but not limited to,
consulting regarding operational matters, employee relations and strategic
plans. Executive hereby accepts such engagement and agrees to perform such
services for the Company upon the terms and conditions set forth herein.
Notwithstanding anything

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herein to the contrary, if the Termination Date occurs on September 19, 2006,
the retention of Executive to provide the Consulting Services, and Executive’s
acceptance of such engagement, shall be only by the mutual agreement of the
Company and Executive on the Termination Date and otherwise on the terms
contained in this paragraph 8; provided, however, if the parties cannot reach
such mutual agreement, the Consulting Termination Date shall not change and
Executive shall be paid compensation for the Consulting Services during the
Consulting Period as set forth in paragraph 2. Executive will perform the
Consulting Services at such times and places as the Company’s Chief Executive
Officer or his designee, from time to time, shall reasonably request. The
Company shall, in accordance with the Company’s normal expense reimbursement
policy, reimburse Executive for reasonable documented out-of-pocket expenses
authorized in advance by the Company that Executive incurs in the course of
providing the Consulting Services. During the Consulting Period, Executive shall
continue to be an employee of the Company. Unless otherwise specifically
authorized by this Amendment or any other agreement between the Company and
Executive, during the Consulting Period, Executive shall have no authority to
transact any business or make any representations or promises in the name of the
Company or its affiliates and shall not hold himself out to be an officer or
senior executive of the Company.
     (b) Term. Unless terminated at an earlier date in accordance with
subparagraph (c) of this paragraph 8, the term of the consulting arrangement
shall be for the period commencing as of the Termination Date and ending at 5:00
p.m., Central Time, on the Consulting Termination Date (the “Consulting
Period”).
     (c) Termination of Consulting Arrangement. Notwithstanding any contrary
provision contained elsewhere in this Amendment, this paragraph 8 and the
consulting arrangement created by this paragraph 8 between the Company and
Executive shall terminate automatically upon the death of Executive. Executive
may terminate the consulting agreement in the event of a breach by the Company
of its obligations under this Amendment which remains uncured 15 days after
written notice thereof is received by the Company. Upon a termination of the
consulting arrangement set forth in this paragraph 8, neither of the parties
hereto shall have any further duty or obligation under this paragraph 8;
provided, however, that termination of the consulting arrangement shall not
affect the duties and obligations set forth in the other sections of this
Amendment or the applicable sections of the Employment Agreement, including,
without limitation, paragraph 2 of this Amendment and paragraph 9 of the
Employment Agreement.
9. Non-Disparagement. Executive and the Company each agrees to refrain from
engaging in any conduct, or from making any comments or statements, that have
the purpose or effect of harming the reputation or goodwill of Executive, on the
one hand, or the Company or any of its affiliates on the other hand.
10. Injunctive Relief. Executive hereby expressly acknowledges that any breach
or threatened breach by him of any of his obligations set forth in paragraphs 7
and 9 of this Amendment and paragraphs 6 and 9 of the Employment Agreement may
result in significant and continuing injury and irreparable harm to the Company,
the monetary value of which would be impossible to establish. Therefore,
Executive agrees that the Company shall be entitled to injunctive relief in a
court of appropriate jurisdiction with respect to such provisions. Such
injunctive remedies shall not be deemed the exclusive remedies, but shall be in
addition to all

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remedies available at law or in equity to the Company, including, without
limitation, the recovery of damages from Executive and Executive’s agents.
Further, if Executive violates the covenants and restrictions herein and the
Company brings legal action for injunctive or other equitable relief, Executive
agrees that the Company shall not be deprived of the benefit of the full period
of the restrictive covenant, as a result of the time involved in obtaining such
relief. Accordingly, Executive agrees that the provisions in this paragraph
shall have a duration determined pursuant to paragraph 9 of the Employment
Agreement, computed from the date the relief is granted. Executive also hereby
waives any requirement for the securing or posting of any bond in connection
with the obtaining of any such equitable relief. The parties further agree that
this provision is a material inducement to the Company to enter into this
Amendment.
11. Mail. The Company may open and answer, and authorize others to open and
answer, all mail communications and other correspondence addressed to Executive
relating to the Company or any of its affiliates or to Executive’s employment
with the Company or any of its affiliates, and Executive shall promptly refer to
the Company all inquiries, mail communications, and correspondence received by
him relating to the Company or any of its affiliates or to Executive’s
employment with the Company or any of its affiliates. If any such mail,
communications or correspondence received by the Company includes any threat of
any claim against Executive personally, the Company shall promptly notify
Executive thereof. The Company will promptly forward to Executive any of
Executive’s personal mail, communications or correspondence received by the
Company, unopened to the extent it is reasonably ascertained to be of a personal
nature.
12. Indemnification. EXECUTIVE AGREES, WARRANTS, AND REPRESENTS TO THE COMPANY
THAT EXECUTIVE HAS FULL EXPRESS AUTHORITY TO RELEASE AND SETTLE ALL CLAIMS THAT
ARE THE SUBJECT OF THE RELEASE ATTACHED AS EXHIBIT C OF THIS AMENDMENT AND THAT
EXECUTIVE HAS NOT GIVEN OR MADE ANY ASSIGNMENT TO ANYONE, INCLUDING EXECUTIVE’S
FAMILY OR LEGAL COUNSEL, OF ANY SUCH CLAIMS AGAINST ANY PERSON OR ENTITY
ASSOCIATED WITH OR ANY COMPANY PARTIES. TO THE EXTENT THAT ANY SUCH CLAIMS MAY
BE BROUGHT BY PERSONS OR ENTITIES CLAIMING BY, THROUGH OR UNDER EXECUTIVE, HIS
RESPECTIVE HEIRS, SUCCESSORS, OR ASSIGNS, THEN EXECUTIVE FURTHER AGREES TO
INDEMNIFY, DEFEND, AND HOLD HARMLESS THE COMPANY OR ANY COMPANY PARTY, ITS
AGENTS, AND ITS SUCCESSORS FROM ANY LAWSUIT OR OTHER PROCEEDING, JUDGMENT, OR
SETTLEMENT ARISING FROM SUCH CLAIMS. EXECUTIVE FURTHER HEREBY ASSIGNS TO THE
COMPANY ALL CLAIMS RELEASED BY EXECUTIVE PURSUANT TO THE RELEASE ATTACHED AS
EXHIBIT C OF THIS AMENDMENT.
13. No Right to Additional Compensation. Except as provided in this Amendment,
the Employment Agreement as amended hereby, and in the Executive Options,
neither the Company nor any of its predecessors, parents, successors, assigns or
affiliates shall have any further obligation to Executive in connection with the
Employment Agreement or Executive’s employment by the Company or any of its
affiliates, including, but not limited to, severance, compensation (including
but not limited to deferred compensation, employment contracts, stock options,
bonuses and commissions), health insurance, life insurance, disability
insurance, club

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dues, vehicle allowances, company plane privileges, vacation pay, sick pay and
any similar obligations.
14. Revocation. Executive acknowledges and agrees that he has 21 days following
the Consulting Termination Date to consider the execution and delivery of the
Release, although he may sign the Release earlier. The parties agree that any
change to this Amendment, whether material or immaterial, shall not restart the
running of this 21 day period, which the parties agree begins upon the
Consulting Termination Date. Upon execution of the Release, Executive will have
7 days to revoke the Release by delivery of a written notice to the Company. The
Release shall not become effective or enforceable, the consideration set forth
in paragraph 3 of this Amendment shall not be paid, and the vesting of options
pursuant to paragraph 4 hereof shall not occur, until after the expiration of
this 7 day period without revocation by Executive (the last day of such 7 day
period being referred to herein as the “Reaffirmation Date”). At its option, the
Company may require, as a condition of Executive receiving the consideration set
forth in this Amendment, Executive to confirm in writing that he has not revoked
this Amendment during the 7 day period. Executive’s acceptance of any of the
consideration set forth in this Amendment shall constitute his acknowledgment
that he did not revoke this Amendment during this 7 day period.
15. Employment Agreement. This Amendment replaces and supersedes in their
entirety paragraphs 1, 3, 4, and 10 and subparagraph 2(a) of the Employment
Agreement. Executive hereby acknowledges and affirms his agreement to the
remaining provisions of the Employment Agreement, including, without limitation,
paragraphs 6 (Confidential Information) and 9 (Non-Competition) of the
Employment Agreement, provided however, that the term of Non-Competition shall
be for a term of twelve months beginning on the expiration or termination of the
Consulting Period. Executive also acknowledges and agrees that the consideration
for his performance under paragraphs 6 and 9 of the Employment Agreement
includes the consideration set forth in paragraph 3 of this Amendment and the
waiver of the Company’s rights to purchase his options and shares of common
stock pursuant to paragraph 4 of this Amendment. In the event of a conflict
between the terms of the Employment Agreement that remain in effect and this
Amendment, the terms of this Amendment shall control. For purposes of the
provisions of the Employment Agreement that remain in effect, “Date of
Termination” shall have the same meaning given to the term “Consulting
Termination Date” in this Amendment.
16. Attorneys’ Fees. The Company shall pay the documented attorneys’ fees of
Executive incurred in connection with the negotiation and execution of this
Amendment in an amount not to exceed $5,000, with such payment to be made within
3 business days after delivery to the Company of appropriate documentation of
such fees.
17. Charter Provisions; Directors’ and Officers’ Liability Insurance Policy. The
Company agrees that it has not, as of the date hereof, amended the
indemnification provisions included in its Certificate of Incorporation or
amended or terminated its directors’ and officers’ liability insurance policy.
18. Technology Equipment. After the Consulting Termination Date, the Executive
shall be entitled to retain the computer equipment and blackberry device
previously issued to him by the

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Company; provided that all charges with respect to such equipment (e.g., monthly
service charges) shall be the sole responsibility of Executive after the
Consulting Termination Date.
19. Outplacement Assistance. Executive shall be entitled to participate in any
outplacement assistance program that the Company may establish in its discretion
until such time as Executive has accepted employment with another employer.
20. Applicable Law. This Amendment shall be governed by and construed in
accordance with the laws of the State of Delaware without reference to
principles of conflict of laws.
21. Counterparts. This Amendment may be executed in two or more counterparts.
22. Advice to Consult with Attorney. Executive is advised to consult with an
attorney prior to executing this Amendment.
23. Survival. The terms and conditions of this Amendment shall survive the
termination of Executive’s employment.
[Remainder of page is intentionally blank.]

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     IN WITNESS WHEREOF, Executive has hereunto set Executive’s hand and the
Company has caused this Amendment to be executed in its name on its behalf, all
as of the day and year first above written.

                  EXECUTIVE    
 
           
 
      /s/ Danny Herron              
 
  By:   Danny Herron    
 
                SWIFT FOODS COMPANY    
 
           
 
  By:   /s/ Jack Shandley    
 
           
 
  Name:   Jack Shandly    
 
  Title:   Vice President Human Resources    

[SIGNATURE PAGE TO THIRD AMENDMENT TO EMPLOYMENT AGREEMENT]

 

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EXHIBIT A
Employment Agreement

A-1

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EXECUTIVE EMPLOYMENT AGREEMENT
     THIS EXECUTIVE EMPLOYMENT AGREEMENT (the “Agreement”) is made and entered
into as of the 20th day of May by and between S&C Holdco, Inc. (to be renamed
Swift & Company), a Delaware corporation (together with its successors and
assigns permitted hereunder, the “Company”), and Danny Herron (the “Executive”).
     WHEREAS, ConAgra Foods, Inc., a Delaware corporation (“CAGCO”), HMTF
Rawhide, L.P., a Delaware limited partnership (“Acquisition LP”), and the
Company have entered into an agreement of even date herewith (the “Acquisition
Agreement”) pursuant to which the Company has agreed to acquire (the
“Acquisition”) the fresh beef, pork, and lamb businesses owned by CAGCO and
certain related cattle feeding operations (the “Businesses”);
     WHEREAS, the Executive has been employed by CAGCO in connection with the
Businesses;
     WHEREAS, the Company and the Executive desire that the Executive’s
employment in connection with the Businesses continue after the consummation of
the Acquisition; and
     WHEREAS, the parties hereto deem it desirable for the Company to employ the
Executive on the terms and conditions set forth herein.
     NOW, THEREFORE, IT IS HEREBY AGREED AS FOLLOWS:
1. Employment Period. Subject to Section 3, the Company hereby agrees to employ
the Executive, and the Executive hereby agrees to be employed by the Company, in
accordance with the terms and provisions of this Agreement, for the period
commencing as of the date of consummation of the Acquisition and ending on the
fourth anniversary date of the consummation of the Acquisition (the “Employment
Period”); provided, however, that commencing on such anniversary date of the
consummation of the Acquisition, and on each anniversary of such date occurring
thereafter, the Employment Period shall automatically be extended for one
additional year unless at least six months prior to the ensuing expiration date
(but no more than 12 months prior to such expiration date), the Company or the
Executive shall have given written notice that it or he, as applicable, does not
wish to extend this Agreement (a “Non-Renewal Notice”). The term “Employment
Period,” as utilized in this Agreement, shall refer to the Employment Period as
so automatically extended.
2. Terms of Employment.
     (a) Position and Duties.
          (i) During the term of the Executive’s employment, the Executive shall
serve as the Chief Financial Officer and Vice President Finance & Controls of
the Company and, in so doing, shall report to the Chief Executive Officer of the
Company (the “CEO”). The Executive shall have supervision and control over, and
responsibility for, such management and operational functions of the Company
currently assigned to such positions, and shall have such other powers and
duties (including holding officer positions with the Company

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and one or more subsidiaries of the Company) as may from time to time be
prescribed by the CEO and agreed to by the Executive, so long as such powers and
duties are reasonable and customary for the chief financial officer and vice
president of finance and controls of an enterprise or division comparable to the
Company.
                    (ii) During the term of the Executive’s employment, and
excluding any periods of vacation and sick leave to which the Executive is
entitled, the Executive agrees to devote substantially all of his business time
to the business and affairs of the Company and, to the extent necessary to
discharge the responsibilities assigned to the Executive hereunder, to use the
Executive’s reasonable best efforts to perform faithfully, effectively and
efficiently such responsibilities. During the term of Executive’s employment, it
shall not be a violation of this Agreement for the Executive to (1) serve on
corporate, civic or charitable boards or committees, (2) deliver lectures or
fulfill speaking engagements and (3) manage personal investments, so long as
such activities do not materially interfere with the performance of the
Executive’s responsibilities as an employee of the Company in accordance with
this Agreement.
     (b) Compensation.
          (i) Base Salary. During the term of the Executive’s employment, the
Executive shall receive an annual base salary (“Annual Base Salary”), which
shall be paid in accordance with the customary payroll practices of the Company,
at least equal to $250,000. Commencing on the first day (the “First Date”) of
the month in the month beginning after the first anniversary date of this
Agreement, and on each subsequent anniversary date of the First Date as long as
the Executive remains an employee of the Company (the First Date and each
subsequent anniversary of the First Date being herein referred to as an
“Adjustment Date”), the Annual Base Salary of the Executive shall be increased
by an amount equal to five percent (5%) of the then current Annual Base Salary
or such greater amount as the Board of Directors of the Company (the “Board”) in
its discretion may determine appropriate. The result of such increase to the
then current Annual Base Salary shall constitute the Executive’s Annual Base
Salary commencing on the Adjustment Date then at hand and continuing until the
next Adjustment Date. Any increase in Annual Base Salary shall not serve to
limit or reduce any other obligation to the Executive under this Agreement. The
term Annual Base Salary as utilized in this Agreement shall refer to Annual Base
Salary as so increased.
          (ii) Bonuses. The Executive shall be eligible to receive an annual
performance bonus (a “Bonus”) in accordance with the provisions of Exhibit A.
For each fiscal year of the Company, the Board shall approve a budget which
shall include, among other things, a target for the items set forth on Exhibit A
hereto for that year. A portion of the Executive’s Bonus shall be based upon the
Company’s achievement of such targets in accordance with the guidelines set
forth on Exhibit A hereto. The Bonus shall be payable on the first day of the
first calendar month after the determination of the Company’s EBITDA (as defined
in Exhibit A).
          (iii) Incentive, Savings and Retirement Plans. During the term of the
Executive’s employment, the Executive shall be entitled to participate in all
incentive, savings and retirement plans, practices, policies and programs
applicable generally to other executives of the Company (“Investment Plans”).

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          (iv) Welfare Benefit Plans. During the term of the Executive’s
employment, the Executive and/or the Executive’s family, as the case may be,
shall be eligible for participation in and shall receive all benefits under
welfare benefit plans, practices, policies and programs (“Welfare Plans”)
provided by the Company (including, without limitation, medical, prescription,
dental, disability, salary continuance, employee life, group life, accidental
death and travel accident insurance plans and programs) to the extent applicable
generally to other executives of the Company.
          (v) Perquisites. During the term of the Executive’s employment, the
Executive shall be entitled to receive (in addition to the benefits described
above) such perquisites and fringe benefits appertaining to his position in
accordance with any practice established by the Board. Executive shall be
furnished with all such facilities and services suitable to his position and
adequate for the performance of his duties.
          (vi) Expenses. During the term of the Executive’s employment, the
Executive shall be entitled to receive prompt reimbursement for all reasonable
employment expenses incurred by the Executive in accordance with the policies,
practices and procedures of the Company.
          (vii) Vacation and Holidays. During the term of the Executive’s
employment, the Executive shall be entitled to four weeks of paid vacation time
each year in addition to those days designated as paid holidays in accordance
with the plans, policies, programs and practices of the Company for its
executive officers. Unused vacation time shall carry over to the next year. Any
unused vacation time shall be paid in a cash lump sum payment promptly after the
Date of Termination, pursuant to Section 4(a)(i).
          (viii) Stock Options. In addition to any benefits the Executive may
receive pursuant to paragraph 2(b)(iii), as may be determined appropriate by the
Board, the Company may, from time to time, grant Executive stock options (the
“Executive Options”) exercisable for shares of capital stock of the Company and,
subject to the terms of this Agreement, such Executive Options shall have such
terms and provisions as may be determined appropriate by the Board. Upon the
closing of the Acquisition, the Company will grant Executive Options in
accordance with the terms of Exhibit B hereto and under a stock option plan to
be adopted upon such closing.
3. Termination of Employment.
     (a) Death or Disability. The Executive’s employment shall terminate
automatically upon the Executive’s death during the Employment Period. If the
Disability of the Executive has occurred during the Employment Period (pursuant
to the definition of Disability set forth below), the Company may give to the
Executive written notice in accordance with Section 11(b) of its intention to
terminate the Executive’s employment. In such event, the Executive’s employment
with the Company shall terminate effective on the 30th day after receipt of such
notice by the Executive (the “Disability Effective Date”), provided that, within
the 30 days after such receipt, the Executive shall not have returned to
full-time performance of the Executive’s duties. For purposes of this Agreement,
“Disability” shall mean the Executive’s inability to perform his duties and
obligations hereunder for a period of 180 consecutive days due to mental or
physical

3

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incapacity as determined by a physician selected by the Company or its insurers
and acceptable to the Executive or the Executive’s legal representative (such
agreement as to acceptability not to be withheld unreasonably).
     (b) Cause. The Company may terminate the Executive’s employment during the
Employment Period for Cause or without Cause. For purposes of this Agreement,
“Cause” shall mean (i) a breach by the Executive of the Executive’s obligations
under Section 2(a) (other than as a result of physical or mental incapacity)
which constitutes a continued material nonperformance by the Executive of his
obligations and duties thereunder, as reasonably determined by the Board, and
which is not remedied within 30 days after receipt of the written notice from
the Board provided for in the next sentence specifying such breach,
(ii) commission by the Executive of an act of fraud upon, or willful misconduct
toward, the Company, as reasonably determined by a majority of the disinterested
members of the Board (neither the Executive nor members of his family being
deemed disinterested for this purpose), (iii) a material breach by the Executive
of Section 6 or Section 9, (iv) the conviction of the Executive of any felony
(or a plea of nolo contendere thereto); or (v) the failure of the Executive to
carry out, or comply with, in any material respect any directive of the Board
consistent with the terms of this Agreement, which is not remedied within
30 days after receipt of the written notice from the Board provided for in the
next sentence. Notwithstanding the foregoing, no act or omission shall
constitute “Cause” for purposes of this Agreement unless the Board provides
Executive (x) written notice clearly and fully describing the particular acts or
omissions which the Board reasonably believes in good faith constitutes “Cause;”
(y) an opportunity, within 30 days following his receipt of such notice, to meet
in person with the Board to explain or defend the alleged acts or omissions
relied upon by the Board and, to the extent practicable, to cure such acts or
omissions; and (z) a copy of a resolution duly adopted by a majority of the
Board (excluding Executive) finding that in the good faith opinion of the Board,
Executive committed the alleged acts or omissions and that they constitute
grounds for Cause hereunder. The Executive shall have the right to contest a
determination of Cause by the Company by requesting arbitration in accordance
with the terms of Section 11(j) hereof.
For purposes of this Agreement, “without Cause” shall mean a termination by the
Company of the Executive’s employment during the Employment Period for any
reason other than a termination based upon Cause, death or Disability, including
pursuant to a Board Determination (as defined in Section 4(b)).
     (c) Good Reason. The Executive’s employment may be terminated during the
Employment Period by the Executive for Good Reason or without Good Reason;
provided, however, that the Executive agrees not to terminate his employment for
Good Reason unless (i) the Executive has given the Company at least 30 days’
prior written notice of his intent to terminate his employment for Good Reason,
which notice shall specify the facts and circumstances constituting Good Reason,
and (ii) the Company has not remedied such facts and circumstances constituting
Good Reason within such 30-day period. For purposes of this Agreement, “Good
Reason” shall mean:
          (i) the assignment to the Executive of any duties inconsistent in any
respect with the Executive’s position (including status, offices, titles and
reporting requirements), authority, duties or responsibilities as contemplated
by Section 2(a) or any other action by the

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Company which results in a material diminution in such position, authority,
duties or responsibilities, excluding for this purpose an isolated,
insubstantial and inadvertent action not taken in bad faith and which is
remedied by the Company promptly after receipt of notice thereof given by the
Executive (without limiting the foregoing, the Company and the Executive agree
that the delegation of the authority, duties or responsibilities of the
Executive to another person or persons, including any committee, shall be deemed
to be an action by the Company which results in a material diminution in the
Executive’s position, authority, duties, or responsibilities as contemplated by
Section 2(a)), provided, however, that Good Reason may not be asserted by the
Executive under this clause (i) of Section 3(c) after a Non-Renewal Notice has
been given by either the Company or the Executive;
          (ii) any termination or material reduction of a material benefit under
any Investment Plan or Welfare Plan in which the Executive participates unless
(1) there is substituted a comparable benefit that is economically substantially
equivalent to the terminated or reduced benefit prior to such termination or
reduction or (2) benefits under such Investment Plan or Welfare Plan are
terminated or reduced with respect to all then existing senior executives of the
Company previously granted benefits thereunder;
          (iii) any failure by the Company to comply with any of the provisions
of Section 2(b), other than an isolated, insubstantial and inadvertent failure
not occurring in bad faith and which is remedied by the Company promptly after
receipt of notice thereof given by the Executive;
          (iv) any failure by the Company to comply with and satisfy
Section 8(c), provided that such successor has received at least ten days prior
written notice from the Company or the Executive of the requirements of
Section 8(c);
          (v) the relocation or transfer of the Executive’s principal office to
a location more than 20 miles from the Company’s current executive offices as
such are maintained on the date hereof in the city of Greeley, Colorado; or
          (vi) without limiting the generality of the foregoing, any material
breach by the Company or any of its subsidiaries or other affiliates (as defined
below) of (1) this Agreement or (2) any other agreement between the Executive
and the Company or any such subsidiary or other affiliate, which material breach
is not remedied by the Company promptly after receipt of notice thereof given by
the Executive.
     As used in this Agreement, “affiliate” means, with respect to a person, any
other person controlling, controlled by or under common control with the first
person; the term “control,” and correlative terms, means the power, whether by
contract, equity ownership or otherwise, to direct the policies or management of
a person; and “person” means an individual, partnership, corporation, limited
liability company, trust or unincorporated organization, or a government or
agency or political subdivision thereof.
     (d) Notice of Termination. Any termination by the Company for Cause or
without Cause, or by the Executive for Good Reason or without Good Reason, shall
be communicated by Notice of Termination to the other party hereto given in
accordance with Section 11(b). For

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purposes of this Agreement, a “Notice of Termination” means a written notice
which (i) indicates the specific termination provision in this Agreement relied
upon, (ii) to the extent applicable, sets forth in reasonable detail the facts
and circumstances claimed to provide a basis for termination of the Executive’s
employment under the provision so indicated and (iii) if the Date of Termination
(as defined below) is other than the date of receipt of such notice, specifies
the termination date (which date shall not be more than 15 days after the giving
of such notice). The failure by the Executive or the Company to set forth in the
Notice of Termination any fact or circumstance which contributes to a showing of
Good Reason or Cause shall not waive any right of the Executive or the Company
hereunder or preclude the Executive or the Company from asserting such fact or
circumstance in enforcing the Executive’s or the Company’s rights hereunder.
     (e) Date of Termination. “Date of Termination” means (i) if the Executive’s
employment is terminated by the Company for Cause, or by the Executive for Good
Reason or without Good Reason, the date of receipt of the Notice of Termination
or any later date specified therein pursuant to Section 3(d), as the case may
be, (ii) if the Executive’s employment is terminated by the Company other than
for Cause, the date on which the Company notifies the Executive of such
termination or any later date specified therein pursuant to Section 3(d), as the
case may be, (iii) if the Executive’s employment is terminated by reason of
death or Disability, the date of death of the Executive or the Disability
Effective Date, as the case may be, and (iv) if the Executive’s employment
terminates due to the giving of a Non-Renewal Notice, the last day of the
Employment Period.
4. Obligations of the Company upon Termination.
     (a) Good Reason; Other Than for Cause, Death or Disability. If, during the
Employment Period, the Company shall terminate the Executive’s employment other
than for either Cause or Disability or the Executive shall terminate his
employment for Good Reason, and the termination of the Executive’s employment in
any case is not due to his death or Disability:
          (i) The Company shall pay to the Executive in a lump sum in cash
within ten days after the Date of Termination the aggregate of the following
amounts: (1) the sum of the Executive’s Annual Base Salary through the Date of
Termination to the extent not theretofore paid and any compensation previously
deferred by the Executive (together with any accrued interest or earnings
thereon) and any accrued vacation pay (“Accrued Obligations”); (2) an amount
equal to two times the Executive’s then current Annual Base Salary; (3) an
amount equal to the greater of either fifty percent (50%) of (a) the maximum
annual Bonus (excluding any “stretch” amounts as described on Exhibit A) that
the Executive could have earned over the remainder of the Employment Period
(assuming that a Non-Renewal Notice would be timely given by the Company prior
to the next ensuing expiration date of the Employment Period) or (b) the highest
Bonus paid hereunder to the Executive prior to the Date of Termination
multiplied by the number of complete, and prorated for any partial, fiscal years
remaining in the Employment Period (assuming that a Non-Renewal Notice would be
timely given by the Company prior to the next ensuing expiration date of the
Employment Period); and (4) any amount arising from Executive’s participation
in, or benefits under, any Investment Plans (“Accrued Investments”), which
amounts shall be payable in accordance with the terms and conditions of such
Investment Plans. Notwithstanding anything to the contrary contained herein, for
purposes of clauses 3(a)

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and (b) of the preceding sentence, if the Date of Termination occurs (x) during
the first year of the Employment Period, the Employment Period shall be deemed
to end two years from the end of the year in which the Date of Termination
occurs, (y) during the second year of the Employment Period, the Employment
Period shall be deemed to end one year from the end of the year in which the
Date of Termination occurs, and (z) during the third or any subsequent year, the
Employment Period shall be deemed to end at the end of the year in which the
Date of Termination occurs.
          (ii) Except as otherwise provided in Section 4(d), the Executive (and
members of his family) shall be entitled to continue their participation in the
Company’s Welfare Plans for a period of 12 months from the Date of Termination.
This period shall be credited against any period for which the Executive and/or
members of his family are entitled to continuation coverage under Section 4980B
of the Internal Revenue Code of 1986, as amended, and Sections 601-609 of the
Employee Retirement Income Security Act of 1974, as amended.
          (iii) Notwithstanding the terms or conditions of any Executive Option,
stock appreciation right or similar agreements between the Company and the
Executive, the Executive shall vest, as of the Date of Termination, in all
rights under such agreements (i.e., Executive Options that would otherwise vest
after the Date of Termination) and thereafter shall be permitted to exercise, in
accordance with the terms of the Executive Options, any and all such rights
until the earlier of (w) the date the Option would otherwise expire in
accordance with its terms, (x) if the Date of Termination is prior to a
Qualifying Public Offering (as defined in that certain Stock Option Agreement of
even date herewith between the Company and Executive), the 270th day after a
Qualifying Public Offering, (y) if the Date of Termination is after a Qualifying
Public Offering, the 90th day after the Date of Termination, or (z) the 90th day
after the completion of a merger, combination, share exchange or similar
transaction involving the Company pursuant to which the securities for which
this Option is then exercisable are listed on a national securities exchange or
the Nasdaq National Market System or any successor thereto; provided, however,
the provisions of this clause (iii) of this Section 4(a) shall not apply to a
termination of the Executive’s employment during the Employment Period that is
made by the Company pursuant to a Board Determination.
     (b) Board Determination. If the Executive’s employment is terminated by the
Company pursuant to a Board Determination during the Employment Period, the
Executive shall be entitled to receive the benefits specified in
Sections 4(a)(i) and 4(a)(ii) of this Agreement. Further, notwithstanding the
terms or conditions of any Executive Option, stock appreciation rights or
similar agreement between the Executive and the Company, all unvested Executive
Options and unvested stock appreciation rights or similar agreements shall be
forfeited and the Executive shall not vest, as of the Date of Termination or
otherwise, in any rights under such unvested Executive Options, stock
appreciation rights or similar agreements that are unvested immediately prior to
the Date of Termination and thereafter shall be permitted to exercise, in
accordance with the terms of the Executive Options, only those rights that were
otherwise vested immediately prior to the Date of Termination until the earlier
of (w) the date the Option would otherwise expire in accordance with its terms,
(x) if the Date of Termination is prior to a Qualifying Public Offering, the
270th day after a Qualifying Public Offering, (y) if the Date of Termination is
after a Qualifying Public Offering, the 90th day after the Date of Termination,
or (z) the 90th day after the completion of a merger, combination, share
exchange or similar

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transaction involving the Company pursuant to which the securities for which
this Option is then exercisable are listed on a national securities exchange or
the Nasdaq National Market System or any successor thereto. For purposes of this
Agreement, a “Board Determination” shall mean a determination by the Board
(which is evidenced by one or more written resolutions to such effect) (i) to
terminate the Executive’s employment during the Employment Period based upon the
Board’s dissatisfaction with the manner in which the Executive has performed his
obligations and duties under Section 2(a) and (ii) that Good Cause does not
exist as a basis for such termination. Notwithstanding the foregoing, no act or
omission shall constitute or be the basis for a termination based upon a Board
Determination unless the Board provides the Executive (a) written notice of its
intention to terminate Executive’s employment pursuant to a Board Determination,
and (b) an opportunity, within 30 days following the Executive’s receipt of such
notice, to meet in person with the Board to explain or defend his performance to
the Board.
     (c) Death or Disability. If the Executive’s employment is terminated by
reason of the Executive’s death or Disability during the Employment Period, the
Company shall pay to his legal representatives (i) in a lump sum in cash within
ten days after the Date of Termination the aggregate of the following amounts:
(A) an amount equal to the Executive’s then current Annual Base Salary or Two
Hundred Fifty Thousand Dollars ($250,000), whichever is greater; and (B) the
Accrued Obligations; and (ii) the Accrued Investments which shall be payable in
accordance with the terms and conditions of the Investment Plans. In addition,
the members of the Executive’s family shall be entitled to continue their
participation in the Company’s Welfare Plans for a period of 12 months after the
Date of Termination. Further, notwithstanding the terms or conditions of any
Executive Option, stock appreciation right or similar agreements between the
Company and the Executive, the Executive shall vest, as of the Date of
Termination, in all rights under such agreements (i.e., Executive Options that
would otherwise vest after the Date of Termination) and thereafter his legal
representative shall be permitted to exercise, in accordance with the terms of
the Executive Options, any and all such rights until the earlier of (w) the date
the Option would otherwise expire in accordance with its terms, (x) if the Date
of Termination is prior to a Qualifying Public Offering, the 270th day after a
Qualifying Public Offering, (y) if the Date of Termination is after a Qualifying
Public Offering, the 90th day after the Date of Termination, or (z) the 90th day
after the completion of a merger, combination, share exchange or similar
transaction involving the Company pursuant to which the securities for which
this Option is then exercisable are listed on a national securities exchange or
the Nasdaq National Market System or any successor thereto. The Company shall
have no further payment obligations to the Executive or his legal
representatives under this Agreement.
     (d) Cause; Other than for Good Reason. If the Executive’s employment shall
be terminated by the Company for Cause or by the Executive without Good Reason
during the Employment Period, the Company shall have no further payment
obligations to the Executive other than for payment of Accrued Obligations,
Accrued Investments (which shall be payable in accordance with the terms and
conditions of the Investment Plans), and the continuance of benefits under the
Welfare Plans to the Date of Termination (or later to the extent required by
law). Further, notwithstanding the terms or conditions of any Executive Option,
stock appreciation rights or similar agreement between the Executive and the
Company, all unvested Executive Options and unvested stock appreciation rights
or similar agreements shall be forfeited and the Executive shall not vest, as of
the Date of Termination or otherwise, in any rights under such Executive
Options, stock appreciation rights or similar agreements that are unvested

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immediately prior to the Date of Termination and thereafter shall be permitted
to exercise, in accordance with the terms of the Executive Options, only those
rights that were otherwise vested immediately prior to the Date of Termination
until the earlier of (w) the date the Option would otherwise expire in
accordance with its terms, (x) if the Date of Termination is prior to a
Qualifying Public Offering, the 270th day after a Qualifying Public Offering,
(y) if the Date of Termination is after a Qualifying Public Offering, the 90th
day after the Date of Termination, or (z) the 90th day after the completion of a
merger, combination, share exchange or similar transaction involving the Company
pursuant to which the securities for which this Option is then exercisable are
listed on a national securities exchange or the Nasdaq National Market System or
any successor thereto.
     (e) If pursuant to the terms and provisions of the Company’s Welfare Plans
the Executive (or members of his family) are not eligible to participate in the
Company’s Welfare Plans because the Executive is no longer an employee of the
Company, then the Company may fulfill its obligations under Section 4(a)(ii),
Section 4(b) or Section 4(c), as applicable, by either providing to the
Executive (or his legal representatives), or reimbursing the Executive (or his
legal representatives) for the costs of, benefits substantially similar to the
benefits provided by the Company to its senior management under its Welfare
Plans as such may from time to time exist after the Date of Termination.
5. Full Settlement, Mitigation. In no event shall the Executive be obligated to
seek other employment or take any other action by way of mitigation of the
amounts payable to the Executive under any of the provisions of this Agreement
and such amounts shall not be reduced whether or not the Executive obtains other
employment. Neither the Executive nor the Company shall be liable to the other
party for any damages in addition to the amounts payable under Section 4 arising
out of the termination of the Executive’s employment prior to the end of the
Employment Period; provided, however, that the Company shall be entitled to seek
damages for any breach of Sections 6, 7 or 9 or criminal misconduct.
6. Confidential Information.
          (a) The Executive acknowledges that the Company and their affiliates
have trade, business and financial secrets and other confidential and
proprietary information (collectively, the “Confidential Information”). As
defined herein, Confidential Information shall not include information (i) that
becomes generally available to the public other than as a result of a disclosure
by Executive, (ii) that is rightfully available to Executive on a
non-confidential basis from a source other than the Company (provided such
source was not bound by a confidentiality agreement with the Company or
otherwise prohibited from transmitting the information to Executive by a
contractual, legal, or fiduciary obligation), or (iii) that is required to be
disclosed by the Executive pursuant to a subpoena or court order, or pursuant to
a requirement of a governmental agency or law of the United States of America or
a state thereof or any governmental or political subdivision thereof; provided,
however, that the Executive shall take all reasonable steps to prohibit
disclosure pursuant to subsection (iii) above.
          (b) The Executive agrees (i) to hold such Confidential Information in
confidence and (ii) not to release such information to any person (other than
Company employees and other persons to whom the Company has authorized the
Executive to disclose

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such information and then only to the extent that such Company employees and
other persons authorized by the Company have a need for such knowledge).
          (c) The Executive further agrees not to use any Confidential
Information for the benefit of any person or entity other than the Company.
          (d) As used in this Section 6, “Company” shall include the Company and
any of its direct or indirect subsidiaries or affiliates.
7. Surrender of Materials Upon Termination. Upon any termination of the
Executive’s employment, the Executive shall immediately return to the Company
all copies, in whatever form, of any and all Confidential Information and other
properties of the Company and their affiliates which are in the Executive’s
possession, custody or control.
8. Successors.
          (a) This Agreement is personal to the Executive and without the prior
written consent of the Company shall not be assignable by the Executive
otherwise than by will or the laws of descent and distribution. This Agreement
shall inure to the benefit of and be enforceable by the Executive’s legal
representatives.
          (b) This Agreement shall inure to the benefit of and be binding upon
the Company and its successors and assigns. The Executive agrees that, on or
after the closing of the Acquisition, the Company may assign this Agreement to
any directly or indirectly owned subsidiary of the Company, in which event
“Company” as used in this Agreement shall thereafter also mean such subsidiary
(except where reference is made to stock options or other benefit plans that are
not maintained by such subsidiary), and in connection with such assignment, such
subsidiary shall expressly assume this Agreement.
          (c) The Company will require any successor (whether direct or
indirect, by purchase, merger, consolidation or otherwise) to all or
substantially all of the business and/or assets of the Company to assume
expressly and agree to perform this Agreement in the same manner and to the same
extent that the Company would be required to perform it if no such succession
had taken place. As used in this Agreement, “Company” shall mean the Company as
hereinbefore defined and any successor to its business and/or assets as
aforesaid which assumes and agrees to perform this Agreement by operation of
law, or otherwise.
9. Non-Competition.
          (a) The term of Non-Competition (herein so called) shall be for a term
beginning on the date hereof and continuing until the second anniversary of the
Date of Termination.
          (b) During the term of Non-Competition, the Executive will not (other
than for the benefit of the Company pursuant to this Agreement), directly or
indirectly, individually or as an officer, director, employee, shareholder,
consultant, contractor, partner, joint venturer, agent, equity owner or in any
capacity whatsoever, engage in any fresh meat or meat processing business (a
“Competing Business”), located in the United States or Australia (the
“Geographic

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Area”), (ii) hire, attempt to hire, or contact or solicit with respect to hiring
any employee of the Company, or (iii) divert or take away any customers of the
Company in the Geographic Area. Notwithstanding the foregoing, the Company
agrees that after the Date of Termination the Executive may be employed by, or
perform services for, a person (as such term is defined in Subsection 3(c)
above) whose business operations include a Competing Business provided that
revenues from such Competing Business comprise less than fifty percent (50%) of
the total revenues of such person at the time the Executive is initially
employed or begins to perform services for such person, so long as Executive
does not personally render advice to, perform any services for, or otherwise
participate in, such Competing Business operations of such person.
Notwithstanding the foregoing, the Company agrees that the Executive may own
less than five percent of the outstanding voting securities of any publicly
traded company that is a Competing Business so long as the Executive does not
otherwise participate in such competing business in any way prohibited by the
preceding sentence.
          (c) During the term of Non-Competition, the Executive will not use the
Executive’s access to, knowledge of, or application of Confidential Information
to perform any duty for any Competing Business; it being understood and agreed
to that this Section 9(c) shall be in addition to and not be construed as a
limitation upon the covenants in Section 9(b) hereof.
          (d) The Executive acknowledges that the geographic boundaries, scope
of prohibited activities, and time duration of the preceding paragraphs are
reasonable in nature and are no broader than are necessary to maintain the
confidentiality and the goodwill of the Company’s proprietary information, plans
and services and to protect the other legitimate business interests of the
Company.
          (e) As used in this Section 9, “Company” shall include the Company and
any of its direct or indirect subsidiaries or affiliates.
10. Effect of Agreement on Other Benefits. The existence of this Agreement shall
not prohibit or restrict the Executive’s entitlement to full participation in
the executive compensation, employee benefit and other plans or programs in
which executives of the Company are eligible to participate.
11. Miscellaneous.
          (a) This Agreement shall be governed by and construed in accordance
with the laws of the State of Delaware without reference to principles of
conflict of laws. The captions of this Agreement are not part of the provisions
hereof and shall have no force or effect. Whenever the terms “hereof”, “hereby”,
“herein”, or words of similar import are used in this Agreement they shall be
construed as referring to this Agreement in its entirety rather than to a
particular section or provision, unless the context specifically indicates to
the contrary. Any reference to a particular “Section” or “paragraph” shall be
construed as referring to the indicated section or paragraph of this Agreement
unless the context indicates to the contrary. The use of the term “including”
herein shall be construed as meaning “including without limitation.” This
Agreement may not be amended or modified otherwise than by a written agreement
executed by the parties hereto or their respective successors and legal
representatives.

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          (b) All notices and other communications hereunder shall be in writing
and shall be given by hand delivery to the other party or by registered or
certified mail, return receipt requested, postage prepaid, addressed as follows:

         
 
  If to the Executive:   Danny Herron
 
      7211 Stadler Court
 
      Fort Collins, Colorado 80528
 
       
 
  With a copy to:   Terence P. Boyle, Esq.
 
      Boyle Partnership, P.C.
 
      1775 Sherman Street, Suite 1375
 
      Denver, Colorado 80203
 
       
 
  If to the Company:   Swift & Company
 
      c/o HMTF Rawhide, L.P.
 
      200 Court, Suite 1600
 
      Dallas, Texas 75201
 
      Attention: Edward Herring
 
       
 
  With a copy to:   Vinson & Elkins L.L.P.
 
      3700 Trammell Crow Center
 
      2001 Ross Avenue
 
      Dallas, Texas 75201
 
      Attention: Michael D. Wortley

or to such other address as either party shall have furnished to the other in
writing in accordance herewith. Notice and communications shall be effective
when actually received by the addressee.
          (c) If any provision of this Agreement is held to be illegal, invalid
or unenforceable under present or future laws effective during the term of this
Agreement, such provision shall be fully severable; this Agreement shall be
construed and enforced as if such illegal, invalid or unenforceable provision
had never comprised a portion of this Agreement; and the remaining provisions of
this Agreement shall remain in full force and effect and shall not be affected
by the illegal, invalid or unenforceable provision or by its severance from this
Agreement. Furthermore, in lieu of such illegal, invalid or unenforceable
provision there shall be added automatically as part of this Agreement a
provision as similar in terms to such illegal, invalid or unenforceable
provision as may be possible and be legal, valid and enforceable.
          (d) The Company shall use all commercially reasonably efforts to
obtain and maintain a director’s and officer’s liability insurance policy during
the term of the Executive’s employment covering the Executive on commercially
reasonable terms, and the amount of coverage shall be reasonable in relation to
the Executive’s position and responsibilities

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hereunder; provided, however, that such coverage may be reduced or eliminated to
the extent that the Company reduces or eliminates coverage for its directors and
executives generally.
          (e) The Company may withhold from any amounts payable under this
Agreement such Federal, state or local taxes as shall be required to be withheld
pursuant to any applicable law or regulation.
          (f) The Executive’s or the Company’s failure to insist upon strict
compliance with any provision of this Agreement, or the failure to assert any
right the Executive or the Company may have hereunder, shall not be deemed to be
a waiver of such provision or right or any other provision or right of this
Agreement.
          (g) The Executive acknowledges that money damages would be both
incalculable and an insufficient remedy for a breach of Section 6 or 9 by the
Executive and that any such breach would cause the Company irreparable harm.
Accordingly, the Company, in addition to any other remedies at law or in equity
it may have, shall be entitled, without the requirement of posting of bond or
other security, to equitable relief, including injunctive relief and specific
performance, in connection with a breach of Section 6 or 9 by the Executive.
          (h) The provisions of this Agreement constitute the complete
understanding and agreement between the parties with respect to the subject
matter hereof and the Executive acknowledges that, except as set forth on
Exhibit C, the Company has no obligations with respect to any retention bonuses,
stay bonuses or severance payments that the Executive may be entitled to as a
result of the Acquisition or the consummation of the transactions contemplated
by the Acquisition Agreement.
          (i) This Agreement may be executed in two or more counterparts.
          (j) In the event any dispute or controversy arises under this
Agreement and is not resolved by mutual written agreement between the Executive
and the Company within 30 days after notice of the dispute is first given, then,
upon the written request of the Executive or the Company, such dispute or
controversy shall be submitted to arbitration to be conducted in accordance with
the rules of the American Arbitration Association. Judgment may be entered
thereon and the results of the arbitration will be binding and conclusive on the
parties hereto. Any arbitrator’s award or finding or any judgment or verdict
thereon will be final and unappealable. All parties agree that venue for
arbitration will be in Denver, Colorado, and that any arbitration commenced in
any other venue will be transferred to Denver, Colorado, upon the written
request of any party to this Agreement. All arbitrations will have three
individuals acting as arbitrators: one arbitrator will be selected by the
Executive, one arbitrator will be selected by the Company, and the two
arbitrators so selected will select a third arbitrator. Any arbitrator selected
by a party will not be affiliated, associated or related to the party selecting
that arbitrator in any matter whatsoever. The decision of the majority of the
arbitrators will be binding on all parties. The Company shall be responsible for
paying its own and the Executive’s attorneys fees, costs and other expenses
pertaining to any such arbitration and enforcement regardless of whether an
arbitrator’s award or finding or any judgment or verdict thereon is entered
against the Executive. The Company shall promptly (and in no event after ten
days following its receipt from the Executive of each written request therefor)
reimburse the Executive for his reasonable

13

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attorneys fees, costs and other expenses pertaining to any such arbitration and
the enforcement thereof.
          (k) Sections 4, 5, 6, 7, 8, 9 and 11 of this Agreement shall survive
the termination of the Executive’s employment.
          (l) This Agreement shall automatically terminate on the termination of
the Acquisition Agreement prior to the consummation of the Acquisition and may
not be amended prior to the consummation of the Acquisition without the consent
of Acquisition LP, which shall be deemed to be a third party beneficiary of this
Agreement prior to the consummation of the Acquisition. Prior to the
consummation of the Acquisition, Acquisition LP, on behalf of the Company, shall
be entitled to terminate this Agreement without obligation on the part of the
Company in the event of the Executive’s death or if the Executive becomes unable
to perform his duties and obligations hereunder due to physical or mental
incapacity as determined by a physician selected by Acquisition LP, on behalf of
the Company, or by the Company’s insurers and such physician reasonably believes
such incapacity will continue for a period of 180 days following the
commencement thereof.
          (m) Except for the obligations of the Company set forth in Exhibit C
hereto and as otherwise set forth in this Agreement, the Executive waives any
and all rights to any retention bonus, stay bonus, or severance payments that he
is otherwise legally entitled to receive from CAGCO or the Company or any of
their respective affiliates.
[Remainder of this page intentionally left blank]

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     IN WITNESS WHEREOF, the Executive has hereunto set the Executive’s hand
and, pursuant to the authorization from the Board, the Company has caused this
Agreement to be executed in its name on its behalf, all as of the day and year
first above written.

                  EXECUTIVE    
 
           
 
      /s/ Danny Herron                   Danny Herron    
 
                S&C HOLDCO, INC. (to be renamed SWIFT & COMPANY)
 
           
 
      /s/ Dwight Goslee              
 
  By:   Dwight J. Goslee    
 
  Title:   President    

 

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EXHIBIT A
Bonus Terms
     The Bonus that the Executive is eligible to receive each year under
Section 2(b)(ii) of this Agreement shall be comprised 80% of an “EBITDA Target
Bonus” and 20% of an “MBO Bonus.” The total annual bonus potential of Executive
shall be no less than 50% of the Executive’s Annual Base Salary.
1. EBITDA Target Bonus
     For the first fiscal year of the Company during the Employment Period the
Executive’s EBITDA Target Bonus shall be calculated as follows:

                      EBITDA Target   EBITDA Target EBITDA Target (a) (b)  
Bonus % (b)   Bonus Amount
$275,000,000
    100 %   $ 100,000  
$245,000,000
    90 %   $ 90,000  
$235,000,000
    80 %   $ 80,000  
$220,000,000
    70 %   $ 70,000  
Less than $220 Million
    0       0  

 

(a)   For each fiscal year of the Company after the expiration of the first
fiscal year of the Company during the Employment Period, the Board of Directors
of the Company shall make an annual determination of the Company’s EBITDA
Target. Such determination shall be made in good faith with a reasonable basis
and shall be consistent with the methodology used to establish the EBITDA Target
in the Company’s annual budget. In no event shall the EBITDA Target exceed the
prior year’s EBITDA Target by more than 10%.

     “EBITDA” shall be defined as the Company’s earnings before interest, taxes,
depreciation, and amortization. EBITDA amounts shall be reduced by the
applicable performance bonus amounts payable to the Executive and other members
of the Company’s management team.
     The EBITDA Target shall be subject to proration if the first fiscal year of
the Company is less than 12 months from the commencement of the Employment
Period or for any subsequent partial fiscal years. In addition, the EBITDA
Target shall be appropriately adjusted by the Board of Directors of the Company
to reflect any divestitures of any divisions or material assets during any
fiscal year.

A-1

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     For each fiscal year (a “Subject Year”) of the Company after the expiration
of the first fiscal year of the Company during the Employment Period, the
percentage of the EBITDA Target Bonus payable to the Executive (“EBITDA Target
Bonus Percentage”) shall be equal to the percentage of the EBIDTA Target
achieved by the Company during such Subject Year; provided, however, that no
EBITDA Target Bonus shall be payable if the actual EBIDTA for such Subject Year
is less than 70% of the EBITDA Target. The determination of whether the Company
achieved the EBITDA Target shall be made in accordance with generally accepted
accounting principles consistently applied by the independent certified public
accountants of the Company, whose determination shall be final and binding.

  (b)   The Executive and the Board of Directors of the Company shall negotiate
in good faith appropriate “stretch” Bonus amounts payable upon achievement of
EBITDA amounts in excess of 100% of the EBITDA Target.

     2. MBO Bonus
     The Executive’s maximum MBO Bonus shall be based upon achievement of
objective criteria established in good faith by the Board of Directors.

A-2

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EXHIBIT B
Stock Options
     Upon the closing of the Acquisition, Executive will be granted options to
purchase One Million Two Hundred Fifty Thousand (1,250,000) shares of common
stock of the Company, pursuant to the Non-Qualified Stock Option Agreement (the
“Stock Option Agreement”) which is attached hereto as portion of Exhibit B to
the Agreement.
     See Exhibit B to Third Amendment to Executive Employment Agreement which is
incorporated herein by reference.

B-1

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EXHIBIT C
Non-Waived Retention Bonuses, Stay Bonuses and Severance Payments
     Executive is entitled to receive a Three Hundred Fifteen Thousand Dollar
($315,000) “stay bonus” to be paid by the Company to the Executive within
15 days of the closing of the Acquisition.

C-1

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     FIRST AMENDMENT TO HERRON EXECUTIVE EMPLOYMENT AGREEMENT made and entered
into as of July 12, 2002, by and between Swift Foods Company, formerly known as
S&C Holdco, Inc., a Delaware corporation (“Holdco”) and Danny Herron (“Herron”).
RECITALS:
     WHEREAS, the parties hereto are parties to the Executive Employment
Agreement dated May 20, 2002 (the “Agreement”);
     WHEREAS, the Agreement was prepared in a manner that anticipated Holdco’s
name to be changed to “Swift & Company”;
     WHEREAS, the parties desire to amend the Agreement to provide and reflect
that Holdco’s name shall be changed to “Swift Foods Company” rather than “Swift
& Company”;
     NOW THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, and intending to be legally bound,
the parties hereto agree as follows:
1. Corporate Name Change of Holdco in Agreement. The Agreement is hereby amended
to reflect that Holdco’s name shall be changed to “Swift Foods Company” rather
than “Swift & Company.”
2. Defined Terms. Capitalized terms used but not otherwise defined herein shall
have the respective meanings ascribed to such terms in the Agreement.
3. Amendments. This First Amendment to Herron Executive Employment Agreement
shall not be amended except in a writing signed by the parties hereto.
4. Counterparts. This First Amendment to Herron Executive Employment Agreement
may be executed and delivered (including by facsimile transmission) in one or
more counterparts, each of which shall be regarded as an original and all of
which shall constitute one and the same instrument.
5. Applicable Law. This First Amendment to Herron Executive Employment Agreement
and the legal relations between the parties hereto shall be governed by and
construed in accordance with the laws of the State of Delaware applicable to
contracts made and performed in Delaware.
6. Consent to Jurisdiction. THE PARTIES HERETO HEREBY IRREVOCABLY SUBMIT TO THE
EXCLUSIVE JURISDICTION OF ANY UNITED STATES FEDERAL OR DELAWARE STATE COURT
SITTING IN WILMINGTON, DELAWARE IN ANY ACTION OR PROCEEDING ARISING OUT OF OR
RELATING TO THIS AGREEMENT AND EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY
AGREES THAT ALL CLAIMS IN RESPECT OF SUCH ACTION OR PROCEEDING SHALL BE HEARD
AND DETERMINED IN ANY SUCH COURT AND IRREVOCABLY WAIVES ANY OBJECTION IT MAY NOW
OR HEREAFTER HAVE

1

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AS TO THE VENUE OF ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN SUCH COURT OR
THAT SUCH COURT IS AN INCONVENIENT FORUM.
[SIGNATURE PAGE FOLLOWS]

2

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     The undersigned parties have executed this First Amendment to Herron
Executive Employment Agreement as of the dated first set forth above.

                  EXECUTIVE    
 
           
 
      /s/ Danny Herron                   Danny Herron    
 
                SWIFT FOODS COMPANY    
 
           
 
  By:   /s/ Dwight J. Goslee    
 
           
 
      Dwight J. Goslee, President    

3

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     SECOND AMENDMENT TO EXECUTIVE EMPLOYMENT AGREEMENT (this “Amendment”) is
made and entered into as of November 3, 2004, by and among SFC Inc. (formerly
known as Swift Foods Company), a Delaware corporation (the “Company”), Swift
Foods Company (formerly known as Rawhide Subsidiary 1 Inc.), a Delaware
corporation (“New SFC”), and Danny Herron (“Herron”).
RECITALS:
     WHEREAS, the parties hereto are parties to the Executive Employment
Agreement, dated May 20, 2002, as amended by that certain First Amendment to
Executive Employment Agreement, dated July 12, 2002, by and between the parties
(as amended, the “Agreement”).
     WHEREAS, in contemplation of certain corporate restructuring changes to and
by the Company and certain of its subsidiaries, the Agreement is to be amended
such that all references contained therein to Holdco or Swift Foods Company
shall refer instead to New SFC and New SFC shall assume all the rights and
obligations of Holdco or Swift Foods Company under the Agreement.
     NOW THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, and intending to be legally bound,
the parties hereto agree as follows:
7. References and Assumption of Agreement. The Agreement is hereby amended such
that all references contained therein to Holdco or Swift Foods Company shall
refer instead to New SFC and New SFC shall assume all the rights and obligations
of Holdco or Swift Foods Company under the Agreement.
8. Defined Terms. Capitalized terms used but not otherwise defined herein shall
have the respective meanings ascribed to such terms in the Agreement.
9. Amendments. This Amendment not be amended except in a writing signed by the
parties hereto.
10. Counterparts. This Amendment may be executed and delivered (including by
facsimile transmission) in one or more counterparts, each of which shall be
regarded as an original and all of which shall constitute one and the same
instrument.
11. Applicable Law. This Amendment and the legal relations between the parties
hereto shall be governed by and construed in accordance with the laws of the
State of Delaware applicable to contracts made and performed in Delaware.
12. Consent to Jurisdiction. THE PARTIES HERETO HEREBY IRREVOCABLY SUBMIT TO THE
EXCLUSIVE JURISDICTION OF ANY UNITED STATES FEDERAL OR DELAWARE STATE COURT
SITTING IN WILMINGTON, DELAWARE IN ANY ACTION OR PROCEEDING ARISING OUT OF OR
RELATING TO THIS AGREEMENT AND EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY
AGREES THAT ALL CLAIMS IN RESPECT OF SUCH ACTION OR PROCEEDING SHALL BE HEARD
AND DETERMINED IN ANY SUCH COURT AND

 

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IRREVOCABLY WAIVES ANY OBJECTION IT MAY NOW OR HEREAFTER HAVE AS TO THE VENUE OF
ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN SUCH COURT OR THAT SUCH COURT IS
AN INCONVENIENT FORUM.
[Remainder of page intentionally left blank]

 

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     The undersigned parties have executed this Amendment as of the dated first
set forth above.

                  EXECUTIVE    
 
                /s/ Danny Herron                   Danny Herron    
 
                SWIFT FOODS COMPANY         (formerly known as Rawhide
Subsidiary 1 Inc.)    
 
           
 
  By:   /s/ Donald F. Wiseman
 
   
 
  Name:   Donald F. Wiseman    
 
  Title:   Vice President    
 
                SFC INC.         (formerly known as Swift Foods Company)    
 
           
 
  By:   /s/ Donald F. Wiseman
 
   
 
  Name:   Donald F. Wiseman    
 
  Title:   Vice President    

                                   

 

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EXHIBIT B
Option Agreements
 B-1

 

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THE SHARES ISSUABLE PURSUANT TO THIS AGREEMENT ARE SUBJECT TO AN OPTION TO
REPURCHASE AND A RIGHT OF FIRST REFUSAL PROVIDED UNDER THE PROVISIONS OF THE
COMPANY’S 2002 STOCK OPTION PLAN AND THIS AGREEMENT IS ENTERED INTO PURSUANT
THERETO. COPIES OF THE PLAN ARE AVAILABLE UPON WRITTEN REQUEST TO THE COMPANY AT
ITS PRINCIPAL EXECUTIVE OFFICES.
SWIFT FOODS COMPANY
2002 STOCK OPTION PLAN
NON-QUALIFIED STOCK OPTION AGREEMENT
September 19, 2002
Danny Herron
c/o Swift Foods Company
1770 Promontory Circle
Greeley, Colorado 80634
Re: Grant of Stock Option
Dear Danny:
     The Board of Directors of Swift Foods Company (the “Company”) has adopted
the Company’s 2002 Stock Option Plan (the “Plan”) for certain individuals,
directors and key employees of the Company and its Related Entities. A copy of
the Plan is being furnished to you concurrently with the execution of this
Option Agreement and shall be deemed a part of this Option Agreement as if fully
set forth herein.
     The terms and provisions of that certain employment agreement between you
and the Company, dated as of May 20, 2002 (together with any successor or
replacement agreement, the “Employment Agreement”), that relate to or affect the
Option are incorporated herein by reference. Terms not defined herein that are
defined in the Employment Agreement shall have the respective meanings set forth
in the Employment Agreement. Terms not defined herein that are not defined in
the Employment Agreement shall have the respective meanings set forth in the
Plan. In the event of any conflict or inconsistency between the terms and
conditions of this Option Agreement and the terms and conditions of the
Employment Agreement, the terms and conditions of the Employment Agreement shall
be controlling.
1. The Grant.

 

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     Subject to the conditions set forth below, the Company hereby grants to
you, effective as of September 19, 2002 (“Grant Date”), as a matter of separate
inducement and not in lieu of any salary or other compensation for your
services, the right and option to purchase (the “Option”), in accordance with
the terms and conditions set forth herein and in the Plan, an aggregate of One
Million Two Hundred Fifty Thousand (1,250,000) shares of Common Stock of the
Company (the “Option Shares”), at the Exercise Price (as hereinafter defined).
As used herein, the term “Exercise Price” shall mean a price equal to $1.00 per
share, subject to the adjustments and limitations set forth herein and in the
Plan. The Option granted hereunder is intended to constitute a Non-Qualified
Option within the meaning of the Plan; however, you should consult with your tax
advisor concerning the proper reporting of any federal or state tax liability
that may arise as a result of the grant or exercise of the Option.
2. Exercise and Vesting.
     (a) For purposes of this Option Agreement, the Option Shares shall be
deemed “Nonvested Shares” unless and until they have become “Vested Shares.”
Except as otherwise provided in Section 3, the Option Shares shall become
“Vested Shares” as follows: (i) one-quarter (1/4) of the Option Shares (i.e.
312,500 Option Shares) shall vest immediately on the Grant Date and
(ii) thereafter, beginning on the last day of the month following the month in
which the first annual anniversary of the Grant Date occurs, 26,042 Option
Shares shall vest monthly on the last day of each month, provided that 26,030
Option Shares shall vest on the last day of the 48th month following the Grant
Date, so that all of the Option Shares shall be vested four years after the
Grant Date, provided, however, that vesting shall cease upon your ceasing to be
an employee of the Company or a Related Entity as expressly provided in
Section 3 hereof.
     (b) Notwithstanding anything to the contrary contained in this Option
Agreement, in the event that a Sale of the Company or Change of Control occurs
while you are an employee of the Company or any Related Entity, then all of the
Option Shares shall vest and become Vested Shares immediately prior to the
consummation of a Sale of the Company or Change of Control.
     (c) The Option Shares that are subject to monthly vesting in each of the
second, third and fourth years after the Grant Date shall become exercisable
only on the anniversary of the Grant Date occurring at the end of the twelve
(12) month period during which they have vested; provided that any Vested Shares
shall be exercisable immediately prior to the consummation of a Sale of the
Company or a Change of Control and, subject to the other terms of this Option
Agreement, immediately following a Termination of Employment. Subject to
preceding sentence and the other relevant provisions and limitations contained
herein and in the Plan, you may exercise the Option to purchase all or a portion
of the applicable number of Vested Shares at any time prior to the termination
of the Option pursuant to this Option Agreement. In no event shall you be
entitled to exercise the Option for any Nonvested Shares or for a fraction of a
Vested Share or for less than 100 shares (unless the number purchased is the
total balance for which the Option is then exercisable).
     (d) The unexercised portion of the Option, if any, will automatically, and
without notice, terminate and become null and void upon the expiration of
10 years from the Grant Date and, except as expressly provided herein, no
portion of the Option may be exercised after such date.

 

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     (e) Any exercise by you of the Option shall be in writing addressed to the
Secretary of the Company at its principal place of business (a copy of the form
of exercise to be used will be available upon written request to the Secretary),
specifying the Option being exercised and the number of shares of Common Stock
to be purchased, and specifying a business day not more than 10 days from the
date such notice is given for the payment of the purchase price against delivery
of the shares of Common Stock being purchased. Subject to the terms of the Plan
and this Option Agreement, the Company shall cause certificates for the shares
so purchased to be delivered at the principal business office of the Company,
against payment of the full purchase price, on the date specified in the notice
of exercise. The Exercise Price shall be paid by you in cash by delivery of a
certified or bank check payable to the order of the Company in the full amount
of the Exercise Price of the shares so purchased, or in such other manner as
described in the Plan and approved by the Committee. Notwithstanding the
foregoing, if permitted by law, payment may be made by: (a) cancellation of any
indebtedness of the Company owed to you; (b) delivering that number of shares of
Common Stock already owned by you having an aggregate Fair Market Value which
shall equal the exercise price (or any portion thereof) and to deliver the
shares thus acquired by you in payment of shares to be received pursuant to the
exercise of additional portions of such Option, the effect of which shall be
that you can in sequence utilize such newly acquired shares in payment of the
exercise price of the entire Option; (c) by waiver of compensation owed,
including any bonus (provided, however, that any bonus shall be deemed to be
owed after such bonus becomes due and payable in accordance with the terms of
the Employment Agreement), to you from the Company for services rendered;
(d) provided that the Common Stock is “publicly traded” (as defined below),
through a “same day sale” commitment from you and a broker-dealer that is a
member of the National Association of Securities Dealers, Inc. (a “NASD Dealer”)
whereby you irrevocably elect to exercise the Option and to sell a portion of
the Common Stock so purchased to pay for the exercise price and whereby the NASD
Dealer irrevocably commits upon receipt of such Common Stock to forward the
exercise price directly to the Company; or (e) any combination of the foregoing.
For purposes of this paragraph, the Common Stock shall be deemed to be “publicly
traded” if it is listed or traded on the New York Stock Exchange, American Stock
Exchange or Nasdaq National Market System.
3. Termination of Employment.
     Upon the termination of your employment with the Company or any Related
Entity, the Option may be exercised in accordance with the following provisions:
     (a) Death or Disability. In the case of termination of your employment with
the Company or any Related Entity due to death or Disability (as defined in your
Employment Agreement), all Option Shares shall vest as of the Date of
Termination (as defined in your Employment Agreement) and immediately become
Vested Shares, and your estate (or any Person who acquired the right to exercise
such Option by bequest or inheritance or otherwise by reason of your death) or
your legal representative may exercise the Option, subject to the provisions of
Section 7, with respect to all or any part of the Vested Shares until the
earlier of (w) the date the Option would otherwise expire in accordance with its
terms, (x) if the Date of Termination is prior to a Qualifying Public Offering,
the 270th day after a Qualifying Public Offering, (y) if the Date of Termination
is after a Qualifying Public Offering, the 90th day after the Date of
Termination, or (z) the 90th day after the completion of a merger, combination,
share exchange or similar transaction involving the Company pursuant to which
the securities for

 

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which this Option is then exercisable are listed on a national securities
exchange or the Nasdaq National Market System or any successor thereto.
     (b) Good Reason; Other Than for Cause, Death or Disability. In the case of
termination of your employment with the Company or any Related Entity for Good
Reason (as defined in your Employment Agreement) or without Cause (as defined in
your Employment Agreement) and other than due to death, Disability or a Board
Determination, all Option Shares shall vest as of the Date of Termination and
immediately become Vested Shares, and you may exercise the Option, subject to
the provisions of Section 7, with respect to all or any part of the Vested
Shares until the earlier of (w) the date the Option would otherwise expire in
accordance with its terms, (x) if the Date of Termination is prior to a
Qualifying Public Offering, the 270th day after a Qualifying Public Offering,
(y) if the Date of Termination is after a Qualifying Public Offering, the 90th
day after the Date of Termination, or (z) the 90th day after the completion of a
merger, combination, share exchange or similar transaction involving the Company
pursuant to which the securities for which this Option is then exercisable are
listed on a national securities exchange or the Nasdaq National Market System or
any successor thereto.
     (c) Cause or Without Good Reason. In the case of termination of your
employment with the Company or any Related Entity for Cause or without Good
Reason, then you shall immediately forfeit your rights under the Option as to
Option Shares which are Nonvested Shares immediately prior to the Date of
Termination, however, you may exercise the Option, subject to the provisions of
Section 7, with respect to all or any part of the Vested Shares until the
earlier of (w) the date the Option would otherwise expire in accordance with its
terms, (x) if the Date of Termination is prior to a Qualifying Public Offering,
the 270th day after a Qualifying Public Offering, (y) if the Date of Termination
is after a Qualifying Public Offering, the 90th day after the Date of
Termination, or (z) the 90th day after the completion of a merger, combination,
share exchange or similar transaction involving the Company pursuant to which
the securities for which this Option is then exercisable are listed on a
national securities exchange or the Nasdaq National Market System or any
successor thereto.
     (d) Board Determination. In the case of termination of your employment with
the Company or any Related Entity pursuant to a Board Determination (as defined
in your Employment Agreement), then you shall immediately forfeit your rights
under the Option as to Option Shares which are Nonvested Shares immediately
prior to the Date of Termination, however, you may exercise the Option, subject
to the provisions of Section 7, with respect to all or any part of the Vested
Shares until the earlier of (w) the date the Option would otherwise expire in
accordance with its terms, (x) if the Date of Termination is prior to a
Qualifying Public Offering, the 270th day after a Qualifying Public Offering,
(y) if the Date of Termination is after a Qualifying Public Offering, the 90th
day after the Date of Termination, or (z) the 90th day after the completion of a
merger, combination, share exchange or similar transaction involving the Company
pursuant to which the securities for which this Option is then exercisable are
listed on a national securities exchange or the Nasdaq National Market System or
any successor thereto.
4. Transferability.
     Except as provided in Section 7 hereof, the Option and any rights or
interests therein will be assignable or transferable by you only as provided in
Section 11 of the Plan and by will or the

 

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laws of descent and distribution. Any Option Shares received upon exercise of
this Option are subject to the Company’s Right of First Refusal (as defined in
the Plan).
     To assure the enforceability of the Company’s rights under this Section 4
in regard to the Right of First Refusal, each certificate or instrument
representing Common Stock held by you shall bear a conspicuous legend in
substantially the following form:
THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO A RIGHT OF FIRST
REFUSAL PROVIDED UNDER THE COMPANY’S 2002 STOCK OPTION PLAN ENTERED INTO
PURSUANT THERETO. A COPY OF SUCH OPTION PLAN IS AVAILABLE UPON WRITTEN REQUEST
TO THE COMPANY AT ITS PRINCIPAL EXECUTIVE OFFICES.
5. Registration.
     The Company shall not in any event be obligated to file any registration
statement under the Securities Act or any applicable state securities laws to
permit exercise of the Option or to issue any Common Stock in violation of the
Securities Act or any applicable state securities laws. You (or in the event of
your death or, in the event a legal representative has been appointed in
connection with your Disability, the Person exercising the Option) shall, as a
condition to your right to exercise the Option, deliver to the Company an
agreement or certificate containing such representations, warranties and
covenants as the Company may deem necessary or appropriate to ensure that the
issuance of the Option Shares pursuant to such exercise is not required to be
registered under the Securities Act or any applicable state securities laws.
     Certificates for Option Shares, when issued, shall have substantially the
following legend, or statements of other applicable restrictions, endorsed
thereon, and may not be immediately transferable:
THE SHARES OF STOCK REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933 OR ANY STATE SECURITIES LAWS. THE SHARES MAY
NOT BE OFFERED FOR SALE, SOLD, PLEDGED, TRANSFERRED OR OTHERWISE DISPOSED OF
UNTIL THE HOLDER HEREOF PROVIDES EVIDENCE SATISFACTORY TO THE ISSUER (WHICH, IN
THE DISCRETION OF THE ISSUER, MAY INCLUDE AN OPINION OF COUNSEL SATISFACTORY TO
THE ISSUER) THAT SUCH OFFER, SALE, PLEDGE, TRANSFER OR OTHER DISPOSITION WILL
NOT VIOLATE APPLICABLE FEDERAL OR STATE LAWS.
     The foregoing legend may not be required for Option Shares issued pursuant
to an effective, registration statement under the Securities Act and in
accordance with applicable state securities laws.
6. Withholding Taxes.
     By acceptance hereof, you hereby (i) agree to reimburse the Company or any
Related Entity by which you are employed for any federal, state or local taxes
required by any

 

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government to be withheld or otherwise deducted by such corporation in respect
of your exercise of all or a portion of the Option, (ii) authorize the Company
or any Related Entity by which you are employed to withhold from any cash
compensation paid to you or on your behalf, an amount sufficient to discharge
any federal, state and local taxes imposed on the Company, or the Related Entity
by which you are employed, and which otherwise has not been reimbursed by you,
in respect of your exercise of all or a portion of the Option, and (iii) agree
that the Company may, in its discretion, hold the stock certificate to which you
are entitled upon exercise of the Option as security for the payment of the
aforementioned withholding tax liability, until cash sufficient to pay that
liability has been accumulated, and may, in its discretion, effect such
withholding by retaining shares issuable upon the exercise of the Option having
a Fair Market Value on the date of exercise which is equal to the amount to be
withheld.
7. Purchase Option.
     (a) If (i) your employment with the Company or a Related Entity terminates
for any reason at any time or (ii) a Sale of the Company or a Change of Control
occurs, the Company (and/or its designees) shall have the option (the “Purchase
Option”) to purchase, and you or your transferees (or your executor or the
administrator of your estate or the Person who acquired the right to exercise
the Option by transfer, bequest or inheritance, in the event of your death, or
your legal representative in the event of your incapacity (hereinafter,
collectively with you, the “Grantor”)) shall sell to the Company and/or its
assignee(s), all or any portion (at the Company’s option) of the Option Shares
and/or the Option held by the Grantor (such Option Shares and Option
collectively being referred to as the “Purchasable Shares”), subject to the
Company’s compliance with the conditions hereinafter set forth.
     (b) The Company shall give notice in writing to the Grantor of the exercise
of the Purchase Option within six (6) months from the date of the termination of
your employment or engagement or such Sale of the Company or Change of Control.
Such notice shall state the number of Purchasable Shares to be purchased and the
determination of the Board of Directors of the Fair Market Value per share of
such Purchasable Shares. If no notice is given within the time limit specified
above, the Purchase Option shall terminate.
     (c) The purchase price to be paid for the Purchasable Shares purchased
pursuant to the Purchase Option shall be, in the case of any Option Shares, an
amount equal to the Fair Market Value per share as of the date of the notice of
exercise of the Purchase Option multiplied by the number of shares being
purchased, and in the case of the Option (including Vested and Nonvested Shares
subject to such Option), an amount equal to the Fair Market Value per share less
the applicable per share Exercise Price multiplied by the number of Vested
Shares subject to such Option which are being purchased. Any purchase price
shall be paid in cash. The closing of such purchase shall take place at the
Company’s principal executive offices within ten (10) days after the purchase
price has been determined. At such closing, the Grantor shall deliver to the
purchasers the certificates or instruments evidencing the Purchasable Shares
being purchased, duly endorsed (or accompanied by duly executed stock powers)
and otherwise in good form for delivery, against payment of the purchase price
by check of the purchasers. In the event that, notwithstanding the foregoing,
the Grantor shall have failed to obtain the release of any pledge or other
encumbrance on any Purchasable Shares by the scheduled closing date, at the
option of the purchasers the closing shall nevertheless occur on such scheduled
closing date, with the cash

 

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purchase price being reduced to the extent of all unpaid indebtedness for which
such Purchasable Shares are then pledged or encumbered.
     (d) To assure the enforceability of the Company’s rights under this
Section 7, each certificate or instrument representing Common Stock held by you
shall bear a conspicuous legend in substantially the following form:
THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO AN OPTION TO
REPURCHASE PROVIDED UNDER THE PROVISIONS OF THE COMPANY’S 2002 STOCK OPTION
PLAN. A COPY OF SUCH OPTION PLAN IS AVAILABLE UPON WRITTEN REQUEST TO THE
COMPANY AT ITS PRINCIPAL EXECUTIVE OFFICES.
     (e) The Company’s rights under this Section 7 shall terminate upon the
consummation of a Qualifying Public Offering
8. Consent to Approved Sale.
     If the Board and the holders of a majority of the Common Stock then
outstanding approve the Sale of the Company to an independent third party (the
“Approved Sale”), you shall consent to and raise no objections against the
Approved Sale, and if the Approved Sale is structured as a sale of capital
stock, you shall agree to sell all of your Option Shares and rights to acquire
Option Shares on the terms and conditions approved by the Board of Directors and
the holders of a majority of the Common Stock then outstanding. You shall take
all necessary and desirable actions in connection with the consummation of the
Approved Sale. For purposes of this Section 8, an “independent third party” is
any person who does not own in excess of 5% of the Common Stock on a
fully-diluted basis, who is not controlling, controlled by or under common
control with any such 5% owner of the Common Stock and who is not the spouse,
ancestor, descendant (by birth or adoption) or descendent of a grandparent of
any such 5% owner of the Common Stock. If the Company or the holders of the
Company’s securities enter into any negotiation or transaction for which
Rule 506 (or any similar rule then in effect) promulgated pursuant to the
Securities Act may be available with respect to such negotiation or transaction
(including a merger, consolidation or other reorganization), you shall, at the
request of the Company, appoint a purchaser representative (as such term is
defined in Rule 501 promulgated pursuant to the Securities Act) reasonably
acceptable to the Company. If you appoint the purchaser representative
designated by the Company, the Company will pay the fees of such purchaser
representative, but if you decline to appoint the purchaser representative
designated by the Company you shall appoint another purchaser representative
(reasonably acceptable to the Company), and you shall be responsible for the
fees of the purchaser representative so appointed.
9. Adjustments.
     In the event that, by reason of any merger, consolidation, combination,
liquidation, reorganization, recapitalization, stock dividend, stock split,
split-up, split-off, spin-off, combination of shares, exchange of shares or
other like change in capital structure of the Company (collectively, a
“Reorganization”), the Common Stock is substituted, combined, or changed into
any cash, property, or other securities, or the shares of Common Stock are
changed

 

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into a greater or lesser number of shares of Common Stock, the number and/or
kind of shares and/or interests subject to an Option and the per share price or
value thereof shall be appropriately adjusted by the Committee to give
appropriate effect to such Reorganization. Any fractional shares or interests
resulting from such adjustment shall be eliminated.
10. Miscellaneous.
     (a) This Option Agreement is subject to all the terms, conditions,
limitations and restrictions contained in the Plan, provided, however, that the
express terms and provisions of this Option Agreement are intended to modify
certain terms and provisions of the Plan. In the event of any conflict or
inconsistency between the express terms and provisions of this Option Agreement
and the terms of the Plan, the terms of this Option Agreement shall be
controlling.
     (b) This Option Agreement is not a contract of employment and the terms of
your employment shall not be affected by, or construed to be affected by, this
Option Agreement, except to the extent specifically provided herein. Nothing
herein shall impose, or be construed as imposing, any obligation (i) on the part
of the Company or any Related Entity to continue your employment, or (ii) on
your part to remain in the employ of the Company or any Related Entity.
     (c) Unless the managing underwriter otherwise agrees, in connection with
any Qualifying Public Offering or subsequent underwritten public offering of
equity securities of the Company, you agree not to effect any public sale or
private offer or distribution of any shares of Common Stock during the ten
business days prior to the effectiveness under the Securities Act of the
registration statement filed in respect of such offering and during such time
period after the effectiveness under the Securities Act of such registration
statement (not to exceed 180 days) (except if applicable as part of such
offering) as the Company and the managing underwriter may agree.
     (d) You shall not have any of the rights of a stockholder with respect to
the shares of Common Stock underlying the Option until the Option is exercised
and you receive such shares.
     (e) For purposes of this Option Agreement, the following terms shall have
the respective meanings indicated:
          (i) “CAGCO Group” shall mean CAGCO and its Subsidiaries.
          (ii) “Change of Control” shall mean the first to occur of the
following events: (i) any sale, lease, exchange, or other transfer (in one
transaction or series of related transactions) of all or substantially all of
the assets of the Company to any Person or group of related Persons for purposes
of Section 13(d) of the Exchange Act, other than one or more members of the HMC
Group, (ii) a majority of the Board of Directors of the Company shall consist of
Persons who are not Continuing Directors; or (iii) the acquisition after the
date of acceptance of this Plan by any Person or Group (other than one or more
members of the HMC Group or the CAGCO Group) of the power, directly or
indirectly, to vote or direct the voting of securities having more than 50% of
the ordinary voting power for the election of directors of the Company.

 

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          (iii) “Designated Date” shall mean the first date on which the Company
shall have consummated a Qualifying Public Offering.
     (f) This Option Agreement may be amended as provided in Section 19 of the
Plan.
[Remainder of this page intentionally left blank]

 

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     Please indicate your acceptance of all the terms and conditions of the
Option and the Plan by signing and returning a copy of this Option Agreement.

                  Very truly yours,    
 
                SWIFT FOODS COMPANY    
 
           
 
  By:   /s/ John N. Simons
 
   
 
  Name:   John N. Simons    
 
  Title:   President and CEO    

         
ACCEPTED:
       
 
       
/s/ Danny Herron
 
       
Danny Herron
       
 
       
 
       
 
Employee Social Security Number or
Taxpayer Identification Number
       
 
       
Date: September 19, 2002
       

Signature Page — Stock Option Agreement

 

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AMENDMENT NO. 1
TO
SWIFT FOODS COMPANY
STOCK OPTION AGREEMENT
     This Amendment No. 1 (the “Amendment”) is entered into as of May 10, 2005,
between Swift Foods Company, a Delaware corporation, and Danny Herron (the
“Option Holder”), and amends that certain Stock Option Agreement (the
“Agreement”) dated September 19, 2002 between Swift Foods Company, a Delaware
corporation (“Old SFC”), and the Option Holder relating to One Million Two
Hundred Fifty Thousand (1,250,000) shares (the “Shares”) of the Company’s Common
Stock, $0.01 par value per share (the “Common Stock”). Capitalized terms not
otherwise defined in this Amendment shall have the same meaning as in the
Agreement.
     WHEREAS, pursuant to an Agreement and Plan of Merger, dated November 3,
2004, by and among Old SFC, Rawhide Subsidiary 1, Inc., a Delaware corporation
(“Rawhide Sub 1”), and Rawhide Subsidiary 3, Inc., a Delaware corporation
(“Rawhide Sub 3”), Old SFC merged with and into Rawhide Sub 3, with Rawhide Sub
3 as the surviving entity (the “Merger”);
     WHEREAS, pursuant to the Merger, Rawhide Sub 1 assumed the Swift Foods
Company 2002 Stock Option Plan previously adopted by Old SFC (the “Plan”); and
     WHEREAS, immediately following the Merger, Rawhide Sub 1 changed its name
to Swift Foods Company (the “Company”).
     For good and valuable consideration, the receipt and sufficiency of which
is hereby acknowledged by both parties, the Company and the Option Holder agree
that the Agreement shall be amended as follows:
     1. The Exercise Price for the shares covered by the Option pursuant to the
Agreement is hereby amended to reduce such exercise price or purchase price from
$1.00 per share to $0.14 per share.
     2. Section 10(e) of the Agreement is deleted in its entirety.
     3. Except as amended hereby, the Agreement shall not be deemed otherwise
amended.
     Executed effective as of the date and year above written.

                  COMPANY:    
 
                SWIFT FOODS COMPANY    
 
           
 
  By:   /s/ Jack Shandley
 
   
 
  Name:   Jack Shandley    
 
  Title:   Vice President, Human Resources    
 
                OPTION HOLDER:    
 
                     /s/ Danny Herron              
 
  (Signature)        
 
                Danny Herron                   (Print or type name)    

 

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THE SHARES ISSUABLE PURSUANT TO THIS AGREEMENT ARE SUBJECT TO AN OPTION TO
REPURCHASE AND A RIGHT OF FIRST REFUSAL PROVIDED UNDER THE PROVISIONS OF THE
COMPANY’S 2002 STOCK OPTION PLAN AND THIS AGREEMENT IS ENTERED INTO PURSUANT
THERETO. COPIES OF THE PLAN ARE AVAILABLE UPON WRITTEN REQUEST TO THE COMPANY AT
ITS PRINCIPAL EXECUTIVE OFFICES.
SWIFT FOODS COMPANY
2002 STOCK OPTION PLAN
NON-QUALIFIED STOCK OPTION AGREEMENT
January 25, 2005
Danny Herron
c/o Swift Foods Company
1770 Promontory Circle
Greeley, Colorado 80634
Re: Grant of Stock Option
Dear Danny:
     The Board of Directors of Swift Foods Company (the “Company”) has adopted
the Company’s 2002 Stock Option Plan, as amended (the “Plan”), for certain
individuals, directors and key employees of the Company and its Related
Entities. A copy of the Plan is being furnished to you concurrently with the
execution of this Option Agreement and shall be deemed a part of this Option
Agreement as if fully set forth herein.
     The terms and provisions of that certain employment agreement between you
and the Company, dated as of May 20, 2002 (together with any successor or
replacement agreement, the “Employment Agreement”), that relate to or affect the
Option are incorporated herein by reference. Terms not defined herein that are
defined in the Employment Agreement shall have the respective meanings set forth
in the Employment Agreement. Terms not defined herein that are not defined in
the Employment Agreement shall have the respective meanings set forth in the
Plan. In the event of any conflict or inconsistency between the terms and
conditions of this Option Agreement and the terms and conditions of the
Employment Agreement, the terms and conditions of the Employment Agreement shall
be controlling.
11. The Grant.
     Subject to the conditions set forth below, the Company hereby grants to
you, effective as of January 25, 2005 (“Grant Date”), as a matter of separate
inducement and not in lieu of any

 

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salary or other compensation for your services, the right and option to purchase
(the “Option”), in accordance with the terms and conditions set forth herein and
in the Plan, an aggregate of Four Hundred Thousand (400,000) shares of Common
Stock of the Company (the “Option Shares”), at the Exercise Price (as
hereinafter defined). As used herein, the term “Exercise Price” shall mean a
price equal to $2.11 per share, subject to the adjustments and limitations set
forth herein and in the Plan. The Option granted hereunder is intended to
constitute a Non-Qualified Option within the meaning of the Plan; however, you
should consult with your tax advisor concerning the proper reporting of any
federal or state tax liability that may arise as a result of the grant or
exercise of the Option.
12. Exercise and Vesting.
     (a) For purposes of this Option Agreement, the Option Shares shall be
deemed “Nonvested Shares” unless and until they have become “Vested Shares.”
Except as otherwise provided in Section 3, the Option Shares shall become
“Vested Shares” as follows: (i) one-quarter (1/4) of the Option Shares (i.e.
100,000 Option Shares) shall vest immediately on the Grant Date and
(ii) thereafter, beginning on the last day of the month following the month in
which the first annual anniversary of the Grant Date occurs, 8,333 Option Shares
shall vest monthly on the last day of each month, provided that 8,345 Option
Shares shall vest on the last day of the 48th month following the Grant Date, so
that all of the Option Shares shall be vested four years after the Grant Date,
provided, however, that vesting shall cease upon your ceasing to be an employee
of the Company or a Related Entity as expressly provided in Section 3 hereof.
     (b) Notwithstanding anything to the contrary contained in this Option
Agreement, in the event that a Sale of the Company or Change of Control occurs
while you are an employee of the Company or any Related Entity, then all of the
Option Shares shall vest and become Vested Shares immediately prior to the
consummation of a Sale of the Company or Change of Control.
     (c) The Option Shares that are subject to monthly vesting in each of the
second, third and fourth years after the Grant Date shall become exercisable
only on the anniversary of the Grant Date occurring at the end of the twelve
(12) month period during which they have vested; provided that any Vested Shares
shall be exercisable immediately prior to the consummation of a Sale of the
Company or a Change of Control and, subject to the other terms of this Option
Agreement, immediately following a Termination of Employment. Subject to
preceding sentence and the other relevant provisions and limitations contained
herein and in the Plan, you may exercise the Option to purchase all or a portion
of the applicable number of Vested Shares at any time prior to the termination
of the Option pursuant to this Option Agreement. In no event shall you be
entitled to exercise the Option for any Nonvested Shares or for a fraction of a
Vested Share or for less than 100 shares (unless the number purchased is the
total balance for which the Option is then exercisable).
     (d) The unexercised portion of the Option, if any, will automatically, and
without notice, terminate and become null and void upon the expiration of
10 years from the Grant Date and, except as expressly provided herein, no
portion of the Option may be exercised after such date.

 

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     (e) Any exercise by you of the Option shall be in writing addressed to the
Secretary of the Company at its principal place of business (a copy of the form
of exercise to be used will be available upon written request to the Secretary),
specifying the Option being exercised and the number of shares of Common Stock
to be purchased, and specifying a business day not more than 10 days from the
date such notice is given for the payment of the purchase price against delivery
of the shares of Common Stock being purchased. Subject to the terms of the Plan
and this Option Agreement, the Company shall cause certificates for the shares
so purchased to be delivered at the principal business office of the Company,
against payment of the full purchase price, on the date specified in the notice
of exercise. The Exercise Price shall be paid by you in cash by delivery of a
certified or bank check payable to the order of the Company in the full amount
of the Exercise Price of the shares so purchased, or in such other manner as
described in the Plan and approved by the Committee. Notwithstanding the
foregoing, if permitted by law, payment may be made by: (a) cancellation of any
indebtedness of the Company owed to you; (b) delivering that number of shares of
Common Stock already owned by you having an aggregate Fair Market Value which
shall equal the exercise price (or any portion thereof) and to deliver the
shares thus acquired by you in payment of shares to be received pursuant to the
exercise of additional portions of such Option, the effect of which shall be
that you can in sequence utilize such newly acquired shares in payment of the
exercise price of the entire Option; (c) by waiver of compensation owed,
including any bonus, to you from the Company for services rendered; (d) provided
that the Common Stock is “publicly traded” (as defined below), through a “same
day sale” commitment from you and a broker-dealer that is a member of the
National Association of Securities Dealers, Inc. (a “NASD Dealer”) whereby you
irrevocably elect to exercise the Option and to sell a portion of the Common
Stock so purchased to pay for the exercise price and whereby the NASD Dealer
irrevocably commits upon receipt of such Common Stock to forward the exercise
price directly to the Company; or (e) any combination of the foregoing. For
purposes of this paragraph, the Common Stock shall be deemed to be “publicly
traded” if it is listed or traded on the New York Stock Exchange, American Stock
Exchange or Nasdaq National Market System.
13. Termination of Employment.
     Upon the termination of your employment with the Company or any Related
Entity, the Option may be exercised in accordance with the following provisions:
     (a) Death or Disability. In the case of termination of your employment with
the Company or any Related Entity due to death or Disability, all Option Shares
shall vest as of the of termination and immediately become Vested Shares, and
your estate (or any Person who acquired the right to exercise such Option by
bequest or inheritance or otherwise by reason of your death) or your legal
representative may exercise the Option, subject to the provisions of Section 7,
with respect to all or any part of the Vested Shares until the earlier of
(w) the date the Option would otherwise expire in accordance with its terms,
(x) if the Date of Termination is prior to a Qualifying Public Offering, the
270th day after a Qualifying Public Offering, (y) if the Date of Termination is
after a Qualifying Public Offering, the 90th day after the Date of Termination,
or (z) the 90th day after the completion of a merger, combination, share
exchange or similar transaction involving the Company pursuant to which the
securities for which this Option is then exercisable are listed on a national
securities exchange or the Nasdaq National Market System or any successor
thereto.

 

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     (b) Good Reason; Other Than for Cause, Death or Disability. In the case of
termination of your employment with the Company or any Related Entity without
Good Reason (as defined in your Employment Agreement) or without Cause (as
defined in your Employment Agreement) and other than due to death, Disability or
a Board Determination, all Option Shares shall vest as of the Date of
Termination and immediately become Vested Shares, and you may exercise the
Option, subject to the provisions of Section 7, with respect to all or any part
of the Vested Shares until the earlier of (w) the date the Option would
otherwise expire in accordance with its terms, (x) if the Date of Termination is
prior to a Qualifying Public Offering, the 270th day after a Qualifying Public
Offering, (y) if the Date of Termination is after a Qualifying Public Offering,
the 90th day after the Date of Termination, or (z) the 90th day after the
completion of a merger, combination, share exchange or similar transaction
involving the Company pursuant to which the securities for which this Option is
then exercisable are listed on a national securities exchange or the Nasdaq
National Market System or any successor thereto.
     (c) Cause or Without Good Reason. In the case of termination of your
employment with the Company or any Related Entity for Cause or without Good
Reason, then you shall immediately forfeit your rights under the Option as to
Option Shares which are Nonvested Shares immediately prior to the Date of
Termination, however, you may exercise the Option, subject to the provisions of
Section 7, with respect to all or any part of the Vested Shares until the
earlier of (w) the date the Option would otherwise expire in accordance with its
terms, (x) if the Date of Termination is prior to a Qualifying Public Offering,
the 270th day after a Qualifying Public Offering, (y) if the Date of Termination
is after a Qualifying Public Offering, the 90th day after the Date of
Termination, or (z) the 90th day after the completion of a merger, combination,
share exchange or similar transaction involving the Company pursuant to which
the securities for which this Option is then exercisable are listed on a
national securities exchange or the Nasdaq National Market System or any
successor thereto.
     (d) Board Determination. In the case of termination of your employment with
the Company or any Related Entity pursuant to a Board Determination (as defined
in your Employment Agreement), then you shall immediately forfeit your rights
under the Option as to Option Shares which are Nonvested Shares immediately
prior to the Date of Termination, however, you may exercise the Option, subject
to the provisions of Section 7, with respect to all or any part of the Vested
Shares until the earlier of (w) the date the Option would otherwise expire in
accordance with its terms, (x) if the Date of Termination is prior to a
Qualifying Public Offering, the 270th day after a Qualifying Public Offering,
(y) if the Date of Termination is after a Qualifying Public Offering, the 90th
day after the Date of Termination, or (z) the 90th day after the completion of a
merger, combination, share exchange or similar transaction involving the Company
pursuant to which the securities for which this Option is then exercisable are
listed on a national securities exchange or the Nasdaq National Market System or
any successor thereto.
14. Transferability.
     Except as provided in Section 7 hereof, the Option and any rights or
interests therein will be assignable or transferable by you only as provided in
Section 11 of the Plan and by will or the laws of descent and distribution. Any
Option Shares received upon exercise of this Option are subject to the Company’s
Right of First Refusal (as defined in the Plan).

 

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     To assure the enforceability of the Company’s rights under this Section 4
in regard to the Right of First Refusal, each certificate or instrument
representing Common Stock held by you shall bear a conspicuous legend in
substantially the following form:
THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO A RIGHT OF FIRST
REFUSAL PROVIDED UNDER THE COMPANY’S 2002 STOCK OPTION PLAN ENTERED INTO
PURSUANT THERETO. A COPY OF SUCH OPTION PLAN IS AVAILABLE UPON WRITTEN REQUEST
TO THE COMPANY AT ITS PRINCIPAL EXECUTIVE OFFICES.
15. Registration.
     The Company shall not in any event be obligated to file any registration
statement under the Securities Act or any applicable state securities laws to
permit exercise of the Option or to issue any Common Stock in violation of the
Securities Act or any applicable state securities laws. You (or in the event of
your death or, in the event a legal representative has been appointed in
connection with your Disability, the Person exercising the Option) shall, as a
condition to your right to exercise the Option, deliver to the Company an
agreement or certificate containing such representations, warranties and
covenants as the Company may deem necessary or appropriate to ensure that the
issuance of the Option Shares pursuant to such exercise is not required to be
registered under the Securities Act or any applicable state securities laws.
     Certificates for Option Shares, when issued, shall have substantially the
following legend, or statements of other applicable restrictions, endorsed
thereon, and may not be immediately transferable:
THE SHARES OF STOCK REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933 OR ANY STATE SECURITIES LAWS. THE SHARES MAY
NOT BE OFFERED FOR SALE, SOLD, PLEDGED, TRANSFERRED OR OTHERWISE DISPOSED OF
UNTIL THE HOLDER HEREOF PROVIDES EVIDENCE SATISFACTORY TO THE ISSUER (WHICH, IN
THE DISCRETION OF THE ISSUER, MAY INCLUDE AN OPINION OF COUNSEL SATISFACTORY TO
THE ISSUER) THAT SUCH OFFER, SALE, PLEDGE, TRANSFER OR OTHER DISPOSITION WILL
NOT VIOLATE APPLICABLE FEDERAL OR STATE LAWS.
     The foregoing legend may not be required for Option Shares issued pursuant
to an effective, registration statement under the Securities Act and in
accordance with applicable state securities laws.
16. Withholding Taxes.
     By acceptance hereof, you hereby (i) agree to reimburse the Company or any
Related Entity by which you are employed for any federal, state or local taxes
required by any government to be withheld or otherwise deducted by such
corporation in respect of your exercise of all or a portion of the Option,
(ii) authorize the Company or any Related Entity by which you are employed to
withhold from any cash compensation paid to you or on your behalf, an amount

 

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sufficient to discharge any federal, state and local taxes imposed on the
Company, or the Related Entity by which you are employed, and which otherwise
has not been reimbursed by you, in respect of your exercise of all or a portion
of the Option, and (iii) agree that the Company may, in its discretion, hold the
stock certificate to which you are entitled upon exercise of the Option as
security for the payment of the aforementioned withholding tax liability, until
cash sufficient to pay that liability has been accumulated, and may, in its
discretion, effect such withholding by retaining shares issuable upon the
exercise of the Option having a Fair Market Value on the date of exercise which
is equal to the amount to be withheld.
17. Purchase Option.
     (a) If (i) your employment with the Company or a Related Entity terminates
for any reason at any time or (ii) a Sale of the Company or a Change of Control
occurs, the Company (and/or its designees) shall have the option (the “Purchase
Option”) to purchase, and you or your transferees (or your executor or the
administrator of your estate or the Person who acquired the right to exercise
the Option by transfer, bequest or inheritance, in the event of your death, or
your legal representative in the event of your incapacity (hereinafter,
collectively with you, the “Grantor”)) shall sell to the Company and/or its
assignee(s), all or any portion (at the Company’s option) of the Option Shares
and/or the Option held by the Grantor (such Option Shares and Option
collectively being referred to as the “Purchasable Shares”), subject to the
Company’s compliance with the conditions hereinafter set forth.
     (b) The Company shall give notice in writing to the Grantor of the exercise
of the Purchase Option within six (6) months from the date of the termination of
your employment or engagement or such Sale of the Company or Change of Control.
Such notice shall state the number of Purchasable Shares to be purchased and the
determination of the Board of Directors of the Fair Market Value per share of
such Purchasable Shares. If no notice is given within the time limit specified
above, the Purchase Option shall terminate.
     (c) The purchase price to be paid for the Purchasable Shares purchased
pursuant to the Purchase Option shall be, in the case of any Option Shares, an
amount equal to the Fair Market Value per share as of the date of the notice of
exercise of the Purchase Option multiplied by the number of shares being
purchased, and in the case of the Option (including Vested and Nonvested Shares
subject to such Option), an amount equal to the Fair Market Value per share less
the applicable per share Exercise Price multiplied by the number of Vested
Shares subject to such Option which are being purchased. Any purchase price
shall be paid in cash. The closing of such purchase shall take place at the
Company’s principal executive offices within ten (10) days after the purchase
price has been determined. At such closing, the Grantor shall deliver to the
purchasers the certificates or instruments evidencing the Purchasable Shares
being purchased, duly endorsed (or accompanied by duly executed stock powers)
and otherwise in good form for delivery, against payment of the purchase price
by check of the purchasers. In the event that, notwithstanding the foregoing,
the Grantor shall have failed to obtain the release of any pledge or other
encumbrance on any Purchasable Shares by the scheduled closing date, at the
option of the purchasers the closing shall nevertheless occur on such scheduled
closing date, with the cash purchase price being reduced to the extent of all
unpaid indebtedness for which such Purchasable Shares are then pledged or
encumbered.

 

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     (d) To assure the enforceability of the Company’s rights under this
Section 7, each certificate or instrument representing Common Stock held by you
shall bear a conspicuous legend in substantially the following form:
THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO AN OPTION TO
REPURCHASE PROVIDED UNDER THE PROVISIONS OF THE COMPANY’S 2002 STOCK OPTION
PLAN. A COPY OF SUCH OPTION PLAN IS AVAILABLE UPON WRITTEN REQUEST TO THE
COMPANY AT ITS PRINCIPAL EXECUTIVE OFFICES.
     (e) The Company’s rights under this Section 7 shall terminate upon the
consummation of a Qualifying Public Offering.
18. Consent to Approved Sale.
     If the Board and the holders of a majority of the Common Stock then
outstanding approve the Sale of the Company to an independent third party (the
“Approved Sale”), you shall consent to and raise no objections against the
Approved Sale, and if the Approved Sale is structured as a sale of capital
stock, you shall agree to sell all of your Option Shares and rights to acquire
Option Shares on the terms and conditions approved by the Board of Directors and
the holders of a majority of the Common Stock then outstanding. You shall take
all necessary and desirable actions in connection with the consummation of the
Approved Sale. For purposes of this Section 8, an “independent third party” is
any person who does not own in excess of 5% of the Common Stock on a
fully-diluted basis, who is not controlling, controlled by or under common
control with any such 5% owner of the Common Stock and who is not the spouse,
ancestor, descendant (by birth or adoption) or descendent of a grandparent of
any such 5% owner of the Common Stock. If the Company or the holders of the
Company’s securities enter into any negotiation or transaction for which
Rule 506 (or any similar rule then in effect) promulgated pursuant to the
Securities Act may be available with respect to such negotiation or transaction
(including a merger, consolidation or other reorganization), you shall, at the
request of the Company, appoint a purchaser representative (as such term is
defined in Rule 501 promulgated pursuant to the Securities Act) reasonably
acceptable to the Company. If you appoint the purchaser representative
designated by the Company, the Company will pay the fees of such purchaser
representative, but if you decline to appoint the purchaser representative
designated by the Company you shall appoint another purchaser representative
(reasonably acceptable to the Company), and you shall be responsible for the
fees of the purchaser representative so appointed.
19. Adjustments.
     In the event that, by reason of any merger, consolidation, combination,
liquidation, reorganization, recapitalization, stock dividend, stock split,
split-up, split-off, spin-off, combination of shares, exchange of shares or
other like change in capital structure of the Company (collectively, a
“Reorganization”), the Common Stock is substituted, combined, or changed into
any cash, property, or other securities, or the shares of Common Stock are
changed into a greater or lesser number of shares of Common Stock, the number
and/or kind of shares and/or interests subject to an Option and the per share
price or value thereof shall be

 

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appropriately adjusted by the Committee to give appropriate effect to such
Reorganization. Any fractional shares or interests resulting from such
adjustment shall be eliminated.
20. Miscellaneous.
     (a) This Option Agreement is subject to all the terms, conditions,
limitations and restrictions contained in the Plan, provided, however, that the
express terms and provisions of this Option Agreement are intended to modify
certain terms and provisions of the Plan. In the event of any conflict or
inconsistency between the express terms and provisions of this Option Agreement
and the terms of the Plan, the terms of this Option Agreement shall be
controlling.
     (b) This Option Agreement is not a contract of employment and the terms of
your employment shall not be affected by, or construed to be affected by, this
Option Agreement, except to the extent specifically provided herein. Nothing
herein shall impose, or be construed as imposing, any obligation (i) on the part
of the Company or any Related Entity to continue your employment, or (ii) on
your part to remain in the employ of the Company or any Related Entity.
     (c) Unless the managing underwriter otherwise agrees, in connection with
any Qualifying Public Offering or subsequent underwritten public offering of
equity securities of the Company, you agree not to effect any public sale or
private offer or distribution of any shares of Common Stock during the ten
business days prior to the effectiveness under the Securities Act of the
registration statement filed in respect of such offering and during such time
period after the effectiveness under the Securities Act of such registration
statement (not to exceed 180 days) (except if applicable as part of such
offering) as the Company and the managing underwriter may agree.
     (d) You shall not have any of the rights of a stockholder with respect to
the shares of Common Stock underlying the Option until the Option is exercised
and you receive such shares.
     (e) This Option Agreement may be amended as provided in Section 19 of the
Plan.
[Remainder of this page intentionally left blank]

 

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     Please indicate your acceptance of all the terms and conditions of the
Option and the Plan by signing and returning a copy of this Option Agreement.

                  Very truly yours,    
 
                SWIFT FOODS COMPANY    
 
           
 
  By:
Name:   /s/ John N. Simons
 
John N. Simons    
 
  Title:   President & CEO    

         
ACCEPTED:
       
 
       
  /s/ Danny Herron
 
Danny Herron
       
 
         
 
Social Security Number or
Taxpayer Identification Number
       
 
       
Date: January 25, 2005
       

Signature Page — Stock Option Agreement

 

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AMENDMENT NO. 1
TO
SWIFT FOODS COMPANY
STOCK OPTION AGREEMENT
     This Amendment No. 1 (the “Amendment”) is entered into as of May 10, 2005,
between Swift Foods Company, a Delaware corporation, and Danny Herron (the
“Option Holder”), and amends that certain Stock Option Agreement (the
“Agreement”) dated January 25, 2005 between Swift Foods Company, a Delaware
corporation (“Old SFC”), and the Option Holder relating to Four Hundred Thousand
(400,000) shares (the “Shares”) of the Company’s Common Stock, $0.01 par value
per share (the “Common Stock”). Capitalized terms not otherwise defined in this
Amendment shall have the same meaning as in the Agreement.
     WHEREAS, pursuant to an Agreement and Plan of Merger, dated November 3,
2004, by and among Old SFC, Rawhide Subsidiary 1, Inc., a Delaware corporation
(“Rawhide Sub 1”), and Rawhide Subsidiary 3, Inc., a Delaware corporation
(“Rawhide Sub 3”), Old SFC merged with and into Rawhide Sub 3, with Rawhide Sub
3 as the surviving entity (the “Merger”);
     WHEREAS, pursuant to the Merger, Rawhide Sub 1 assumed the Swift Foods
Company 2002 Stock Option Plan previously adopted by Old SFC (the “Plan”); and
     WHEREAS, immediately following the Merger, Rawhide Sub 1 changed its name
to Swift Foods Company (the “Company”).
     For good and valuable consideration, the receipt and sufficiency of which
is hereby acknowledged by both parties, the Company and the Option Holder agree
that the Agreement shall be amended as follows:
     1. The Exercise Price for the shares covered by the Option pursuant to the
Agreement is hereby amended to reduce such exercise price or purchase price from
$2.11 per share to $1.25 per share.
     2. Except as amended hereby, the Agreement shall not be deemed otherwise
amended.
     Executed effective as of the date and year above written.

                  COMPANY:    
 
                SWIFT FOODS COMPANY    
 
           
 
  By:   /s/ Jack Shandley
 
        Name: Jack Shandley         Title: Vice President, Human Resources    
 
                OPTION HOLDER:    
 
                     /s/ Danny Herron                   (Signature)    
 
                Danny Herron                   (Print or type name)    

Signature Page — Stock Option Agreement

 

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EXHIBIT C
FORM OF RELEASE
     THIS RELEASE (this “Agreement”) is made as of                     , 200___,
by and among Swift Foods Company, a Delaware corporation (the “Company”), and
Danny Herron (“Executive”).
RECITALS
     WHEREAS, the Company and Executive are parties to the Executive Employment
Agreement, dated May 20, 2002, as amended by that certain First Amendment to
Executive Employment Agreement, dated July 12, 2002, that certain Second
Amendment to Executive Employment Agreement, dated November 3, 2004, and that
certain Third Amendment to Executive Employment Agreement, dated November ___,
2005 (as so amended, the “Employment Agreement”);
     WHEREAS, capitalized terms used herein but not defined herein shall have
the meanings assigned to them in the Employment Agreement; and
     WHEREAS, Executive’s employment with the Company has terminated as
contemplated by the Third Amendment to Executive Employment Agreement, and
Executive and the Company desire to enter into certain releases as provided
herein:
AGREEMENTS:
     NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:
          1. EXECUTIVE, ON BEHALF OF HIMSELF, HIS FAMILY, ATTORNEYS, HEIRS,
ESTATE, AGENTS, EXECUTORS, REPRESENTATIVES, ADMINISTRATORS AND EACH OF THEIR
RESPECTIVE SUCCESSORS AND ASSIGNS (TOGETHER THE “EXECUTIVE PARTIES”), HEREBY
GENERALLY RELEASES AND FOREVER DISCHARGES THE COMPANY, ITS PREDECESSORS,
SUCCESSORS, ASSIGNS, PARENTS, SUBSIDIARIES AND AFFILIATES, AND EACH OF THE
FOREGOING ENTITIES’ AND PERSONS’ PAST, PRESENT AND FUTURE DIRECT OR INDIRECT
STOCKHOLDERS, MEMBERS, MANAGERS, PARTNERS, DIRECTORS, OFFICERS, EMPLOYEES,
AGENTS, REPRESENTATIVES, PRINCIPALS, INSURERS, BENEFIT PLANS (AND EACH SUCH
PLAN’S FIDUCIARIES, ADMINISTRATORS, TRUSTEES, SPONSORS, COMMITTEES AND
REPRESENTATIVES) AND ATTORNEYS (TOGETHER THE “COMPANY PARTIES”) FROM ANY AND ALL
CLAIMS, COMPLAINTS, CHARGES, DEMANDS, LIABILITIES, SUITS, DAMAGES, LOSSES,
EXPENSES, ATTORNEYS’ FEES, OBLIGATIONS OR CAUSES OF ACTION (COLLECTIVELY
“CLAIMS”), KNOWN OR UNKNOWN, OF ANY KIND AND EVERY NATURE WHATSOEVER, AND
WHETHER OR NOT ACCRUED OR MATURED, WHICH ANY OF THEM MAY HAVE, ARISING OUT OF OR
RELATING TO ANY TRANSACTION, DEALING, RELATIONSHIP, CONDUCT, ACT OR OMISSION, OR
ANY

C-1

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OTHER MATTERS OR THINGS OCCURRING OR EXISTING AT ANY TIME PRIOR TO AND INCLUDING
THE CONSULTING TERMINATION DATE, SUBJECT TO THE LIMITATIONS SET FORTH IN THE
FOLLOWING SENTENCE. THIS RELEASE INCLUDES BUT IS NOT LIMITED TO ANY CLAIMS
AGAINST ANY OF THE COMPANY PARTIES BASED ON, RELATING TO OR ARISING UNDER
WRONGFUL DISCHARGE, RETALIATION, BREACH OF CONTRACT (WHETHER ORAL OR WRITTEN),
TORT, FRAUD, DEFAMATION, NEGLIGENCE, PROMISSORY ESTOPPEL, TITLE VII OF THE CIVIL
RIGHTS ACT OF 1964, THE AGE DISCRIMINATION IN EMPLOYMENT ACT, THE AMERICANS WITH
DISABILITIES ACT, EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, THE WORKER
ADJUSTMENT AND RETRAINING NOTIFICATION ACT, THE FAMILY AND MEDICAL LEAVE ACT OR
ANY OTHER FEDERAL, STATE OR LOCAL LAW RELATING TO EMPLOYMENT, CIVIL OR HUMAN
RIGHTS, OR DISCRIMINATION IN EMPLOYMENT (BASED ON AGE OR ANY OTHER FACTOR) IN
ALL CASES ARISING OUT OF OR RELATING TO (I) EXECUTIVE’S EMPLOYMENT BY THE
COMPANY OR ANY OF ITS AFFILIATES, (II) THE EMPLOYMENT AGREEMENT (SUBJECT TO THE
TERMS OF THIS AMENDMENT), (III) THE EXECUTIVE OPTIONS, (IV) EXECUTIVE’S
INVESTMENT IN THE COMPANY OR ANY OF ITS AFFILIATES, (V) EXECUTIVE’S SERVICES AS
AN OFFICER, DIRECTOR OR EMPLOYEE OF THE COMPANY OR ANY OF ITS AFFILIATES, OR
(VI) OTHERWISE RELATING TO THE TERMINATION OF EXECUTIVE’S EMPLOYMENT OR SERVICES
OR TO ANY OTHER TRANSACTION, DEALING OR AGREEMENT BETWEEN EXECUTIVE AND THE
COMPANY OR ANY OF ITS AFFILIATES; PROVIDED, HOWEVER, THAT THIS GENERAL RELEASE
WILL NOT LIMIT OR RELEASE (I) EXECUTIVE’S RIGHTS UNDER THE EMPLOYMENT AGREEMENT,
AS AMENDED, (II) EXECUTIVE’S RIGHTS UNDER THE EXECUTIVE OPTIONS,
(III) EXECUTIVE’S RIGHTS UNDER THE STOCKHOLDERS AGREEMENT DATED AS OF SEPTEMBER
19, 2002 AMONG HMTF RAWHIDE, L.P., CONAGRA FOODS, INC., HICKS, MUSE, TATE &
FURST INCORPORATED, THE COMPANY AND THE OTHER INDIVIDUALS NAMED THEREIN, OR
(IV) EXECUTIVE’S RIGHTS TO INDEMNIFICATION FROM THE COMPANY IN RESPECT OF HIS
SERVICES AS A DIRECTOR, OFFICER OR EMPLOYEE OF THE COMPANY OR ANY OF ITS
AFFILIATES TO THE MAXIMUM EXTENT ALLOWED BY LAW, ANY INDEMNIFICATION AGREEMENTS
TO WHICH EXECUTIVE AND THE COMPANY OR ANY OF ITS AFFILATES ARE PARTIES, OR THE
CERTIFICATES OF INCORPORATION OR BY-LAWS (OR LIKE CONSTITUTIVE DOCUMENTS) OF THE
COMPANY OR ANY OF ITS AFFILIATES. EXECUTIVE, ON BEHALF OF HIMSELF AND THE
EXECUTIVE PARTIES, HEREBY COVENANTS FOREVER NOT TO ASSERT, FILE, PROSECUTE,
COMMENCE OR INSTITUTE (OR SPONSOR OR PURPOSELY FACILITATE ANY PERSON IN
CONNECTION WITH THE FOREGOING), ANY COMPLAINT OR LAWSUIT OR ANY LEGAL,
EQUITABLE, ARBITRAL OR ADMINISTRATIVE PROCEEDING OF ANY NATURE, AGAINST ANY OF
THE COMPANY PARTIES IN CONNECTION WITH ANY CLAIMS RELEASED IN THIS PARAGRAPH 1,
AND REPRESENTS AND WARRANTS THAT NO OTHER PERSON OR ENTITY HAS INITIATED OR, TO
THE EXTENT WITHIN HIS CONTROL, WILL INITIATE ANY SUCH PROCEEDING ON HIS BEHALF,
AND THAT IF SUCH A PROCEEDING IS INITIATED, EXECUTIVE SHALL ACCEPT NO BENEFIT
THEREFROM.

C-2

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          2. THE COMPANY, ON ITS OWN BEHALF AND ON BEHALF OF ITS SUBSIDIARIES
AND THE COMPANY PARTIES, HEREBY GENERALLY RELEASES AND FOREVER DISCHARGES THE
EXECUTIVE PARTIES FROM ANY AND ALL CLAIMS, KNOWN OR UNKNOWN, OF ANY KIND AND
EVERY NATURE WHATSOEVER, AND WHETHER OR NOT ACCRUED OR MATURED, WHICH ANY OF
THEM MAY HAVE, ARISING OUT OF OR RELATING TO ANY TRANSACTION, DEALING,
RELATIONSHIP, CONDUCT, ACT OR OMISSION, OR ANY OTHER MATTERS OR THINGS OCCURRING
OR EXISTING AT ANY TIME PRIOR TO AND INCLUDING THE CONSULTING TERMINATION DATE;
PROVIDED, HOWEVER, THAT THIS GENERAL RELEASE WILL NOT LIMIT OR RELEASE (I) THE
COMPANY’S RIGHTS UNDER THIS AMENDMENT AND THE EMPLOYMENT AGREEMENT AS AMENDED
HEREBY, (II) THE COMPANY’S RIGHTS UNDER THE EXECUTIVE OPTIONS, OR (III) THE
COMPANY’S RIGHTS AGAINST EXECUTIVE WITH RESPECT TO ANY FRAUDULENT ACTIVITY. THE
COMPANY ON BEHALF OF ITSELF, ITS SUBSIDIARIES AND THE COMPANY PARTIES, HEREBY
COVENANTS FOREVER NOT TO ASSERT, FILE, PROSECUTE, COMMENCE OR INSTITUTE (OR
SPONSOR OR PURPOSELY FACILITATE ANY PERSON IN CONNECTION WITH THE FOREGOING),
ANY COMPLAINT OR LAWSUIT OR ANY LEGAL, EQUITABLE, ARBITRAL OR ADMINISTRATIVE
PROCEEDING OF ANY NATURE, AGAINST ANY OF THE EXECUTIVE PARTIES IN CONNECTION
WITH ANY CLAIMS RELEASED IN THIS PARAGRAPH 2 AND REPRESENTS AND WARRANTS THAT NO
OTHER PERSON OR ENTITY HAS INITIATED OR, TO THE EXTENT WITHIN ITS CONTROL, WILL
INITIATE ANY SUCH PROCEEDING ON ITS BEHALF, AND THAT IF SUCH A PROCEEDING IS
INITIATED, THE COMPANY AND ITS SUBSIDIARIES AND THE COMPANY PARTIES SHALL ACCEPT
NO BENEFIT THEREFROM.
          3. If any provision of this Agreement shall be declared invalid or
unenforceable under applicable law, then the performance of such portion shall
be excused to the extent of such invalidity or unenforceability, but the
remainder of this Agreement shall remain in full force and effect; provided,
however, that if the excused performance of such unenforceable provision shall
materially adversely affect the interest of either party, the party so affected
shall have the right to terminate this Agreement by written notice thereof to
the other party, whereupon this Agreement shall become null and void. The
parties each acknowledge that: (f) they have been represented by independent
counsel in connection with this Agreement; (g) they have executed this Agreement
with the advice of such counsel; (h) this Agreement is the result of
negotiations between the parties hereto with the advice and assistance of their
respective counsel; and (i) this Agreement is made pursuant to the terms of the
Employment Agreement and is subject to the provisions of paragraph 14 of the
Third Amendment to Executive Employment Agreement.
[The remainder of this page is intentionally left blank]

C-3

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     IN WITNESS WHEREOF, Executive has hereunto set Executive’s hand and the
Company has caused this Agreement to be executed in its name on its behalf, all
as of the day and year first above written.

                  EXECUTIVE                
 
  By:   Danny Herron    
 
                SWIFT FOODS COMPANY    
 
           
 
  By:        
 
  Name:  
 
   
 
  Title:  
 
   
 
     
 
   

C-4