Exhibit 10.1

 

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EXECUTION COPY

JPMorgan Chase Bank, National Association

P.O. Box 161

60 Victoria Embankment

London EC4Y 0JP

England

September 9, 2008

To: Tyson Foods, Inc.

2210 West Oaklawn Drive

Springdale, Arkansas 72762-6999

Attention: Treasurer

Telephone No.: (479) 290-4000

Facsimile No.:(479) 757-6868

Re: Call Option Transaction

The purpose of this letter agreement (this “Confirmation”) is to confirm the
terms and conditions of the call option transaction entered into between
JPMorgan Chase Bank, National Association, London Branch (“Dealer”) and Tyson
Foods, Inc. (“Counterparty”) as of the Trade Date specified below (the
“Transaction”). This letter agreement constitutes a “Confirmation” as referred
to in the ISDA Master Agreement specified below. This Confirmation shall replace
any previous agreements and serve as the final documentation for this
Transaction.

The definitions and provisions contained in the 2002 ISDA Equity Derivatives
Definitions (the “Equity Definitions”), as published by the International Swaps
and Derivatives Association, Inc. (“ISDA”) are incorporated into this
Confirmation. In the event of any inconsistency between the Equity Definitions
and this Confirmation, this Confirmation shall govern. Certain defined terms
used herein have the meanings assigned to them in the prospectus dated
September 4, 2008, as supplanted by the prospectus supplement dated
September 10, 2008 (collectively, the “Prospectus”) relating to the USD
450,000,000 principal amount of 3.25% Convertible Senior Notes due October 15,
2013, (the “Convertible Notes” and each USD 1,000 principal amount of
Convertible Notes, a “Convertible Note”) issued by Counterparty pursuant to an
indenture dated June 1, 1995 between Counterparty and The Bank of New York
Mellon Trust Company, N.A., as trustee (the “Trustee”) (the “Base Indenture”),
as supplemented by the supplemental indenture between Counterparty and the
Trustee to be dated September 15, 2008 (the “Supplemental Indenture” and,
together with the Base Indenture, the “Indenture”). In the event of any
inconsistency between the terms defined in the Prospectus, the Indenture and
this Confirmation, this Confirmation shall govern. The parties acknowledge that
this Confirmation is entered into on the date hereof with the understanding that
(i) definitions set forth in the Indenture which are also defined herein by
reference to the Indenture and (ii) sections of the Indenture that are referred
to herein will conform to the descriptions thereof in the Prospectus. If any
such definitions in the Indenture or any such sections of the Indenture differ
from the descriptions thereof in the Prospectus, the descriptions thereof in the
Prospectus will govern for purposes of this Confirmation. The parties further
acknowledge that the Indenture section numbers used herein are based on the
draft of the Indenture last reviewed by Dealer as of the date of this
Confirmation, and if any such section numbers are changed in the Indenture as
executed, the parties will amend this Confirmation in good faith to preserve the
intent of the parties. For the avoidance of doubt, references to the Base
Indenture or the Supplemental Indenture, as the case may be, herein are
references to the Base Indenture or the Supplemental Indenture, as the case may
be, as in effect on the date of its execution and if the Base Indenture or the
Supplemental Indenture is amended following its execution, any such amendment
will be disregarded for purposes of this Confirmation unless the parties agree
otherwise in writing.

JPMorgan Chase Bank, National Association

Organized under the laws of the United States as a National Banking Association

Main Office 1111 Polaris Parkway, Columbus, Ohio, 43271

Registered as a branch in England & Wales branch number BR000746.

Registered branch address 125 London Wall, London, EC2Y 5AJ.

Authorized and regulated by the Financial Services Authority.

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Each party is hereby advised, and each such party acknowledges, that the other
party has engaged in, or refrained from engaging in, substantial financial
transactions and has taken other material actions in reliance upon the parties’
entry into the Transaction to which this Confirmation relates on the terms and
conditions set forth below.

1. This Confirmation evidences a complete and binding agreement between Dealer
and Counterparty as to the terms of the Transaction to which this Confirmation
relates. This Confirmation shall supplement, form a part of, and be subject to
an agreement in the form of the 2002 ISDA Master Agreement (the “Agreement”) as
if Dealer and Counterparty had executed an agreement in such form (but without
any Schedule except for the election of the laws of the State of New York as the
governing law) on the Trade Date. In the event of any inconsistency between
provisions of that Agreement and this Confirmation, this Confirmation will
prevail for the purpose of the Transaction to which this Confirmation relates.
The parties hereby agree that no Transaction other than the Transaction to which
this Confirmation relates shall be governed by the Agreement.

2. The terms of the particular Transaction to which this Confirmation relates
are as follows:

 

General Terms:   

Trade Date:

   September 9, 2008

Effective Date:

   The third Exchange Business Day immediately prior to the Premium Payment Date

Option Style:

   “Modified American”, as described under “Procedures for Exercise” below

Option Type:

   Call

Buyer:

   Counterparty

Seller:

   Dealer

Shares:

   The Class A Common Stock of Counterparty, par value USD 0.10 per Share
(Exchange symbol “TSN”)

Number of Options:

   450,000. For the avoidance of doubt, the Number of Options shall be reduced
by any Options exercised by Counterparty. In no event will the Number of Options
be less than zero.

Applicable Percentage:

   50%

Option Entitlement:

   As of any date, a number equal to the product of the Applicable Percentage
and the Conversion Rate as of such date (as defined in the Supplemental
Indenture, but without regard to any adjustments to the Conversion Rate pursuant
to Section 4.04(g), Section 4.04(h) or to Section 4.06 of the Supplemental
Indenture), for each Convertible Note.

Strike Price:

   USD 16.8937

Premium:

   USD 45,990,000.00

 

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Premium Payment Date:

   September 15, 2008

Exchange:

   The New York Stock Exchange

Related Exchange(s):

   All Exchanges Procedures for Exercise:   

Exercise Period(s):

   Notwithstanding anything to the contrary in the Equity Definitions, an
Exercise Period shall occur with respect to an Option hereunder only if such
Option is an Exercisable Option (as defined below) and the Exercise Period shall
be, in respect of any Exercisable Option, the period commencing on, and
including, the relevant Conversion Date and ending on, and including, the
Scheduled Valid Day immediately preceding the first day of the relevant
Settlement Averaging Period in respect of such Conversion Date; provided that in
respect of Exercisable Options relating to Convertible Notes for which the
relevant Conversion Date occurs on or after June 15, 2013, the final day of the
Exercise Period shall be the Scheduled Valid Day immediately preceding the
Expiration Date.

Conversion Date:

   With respect to any conversion of Convertible Notes, the date on which the
Holder (as such term is defined in the Indenture) of such Convertible Notes
satisfies all of the requirements for conversion thereof as set forth in Section
4.02(b) of the Supplemental Indenture.

Exercisable Options:

   In respect of each Exercise Period, a number of Options equal to the number
of Convertible Notes surrendered to Counterparty for conversion with respect to
such Exercise Period but no greater than the Number of Options.

Expiration Time:

   The Valuation Time

Expiration Date:

   October 15, 2013, subject to earlier exercise.

Multiple Exercise:

   Applicable, as described under Exercisable Options above.

Automatic Exercise:

   Applicable; and means that in respect of an Exercise Period, a number of
Options not previously exercised hereunder equal to the number of Exercisable
Options shall be deemed to be exercised on the final day of such Exercise Period
for such Exercisable Options; provided that such Options shall be deemed
exercised only to the extent that Counterparty has provided a Notice of Exercise
to Dealer.

Notice of Exercise:

   Notwithstanding anything to the contrary in the Equity Definitions, in order
to exercise any Exercisable Options, Counterparty must notify Dealer in writing
before 5:00 p.m. (New York City time) on the Scheduled Valid Day prior to the
scheduled first day of the

 

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   Settlement Averaging Period for the Exercisable Options being exercised of
(i) the number of such Options and (ii) the scheduled first day of the
Settlement Averaging Period and the scheduled Settlement Date; provided that in
respect of Exercisable Options relating to Convertible Notes with a Conversion
Date occurring on or after June 15, 2013, such notice may be given on or prior
to the second Scheduled Valid Day immediately preceding the Expiration Date and
need only specify the number of such Exercisable Options. Settlement Terms:   

Settlement Method:

   Net Share Settlement

Net Share Settlement:

   Dealer will deliver to Counterparty, on the relevant Settlement Date, a
number of Shares equal to the Net Shares in respect of any Exercisable Option
exercised or deemed exercised hereunder. In no event will the Net Shares be less
than zero.

Net Shares:

   In respect of any Exercisable Option exercised or deemed exercised, a number
of Shares equal to (A) the sum of the quotients, for each Valid Day during the
Settlement Averaging Period for such Exercisable Option, of (x) the Option
Entitlement on such Valid Day multiplied by (y) the Relevant Price on such Valid
Day less the Strike Price, divided by (z) such Relevant Price, divided by (B)
the number of Valid Days in the Settlement Averaging Period; provided, however,
that if the calculation contained in clause (y) above results in a negative
number, such number shall be replaced with the number “zero”.    Dealer will
deliver cash in lieu of any fractional Shares to be delivered with respect to
any Net Shares valued at the Relevant Price for the last Valid Day of the
Settlement Averaging Period.

Valid Day:

   “Valid Day” means a “Trading Day” as defined in the Supplemental Indenture.

Scheduled Valid Day:

   “Scheduled Valid Day” means a “Scheduled Trading Day” as defined in the
Supplemental Indenture.

Relevant Price:

   On any Valid Day, the “Daily VWAP” as defined in the Supplemental Indenture;
provided that in the event that Daily VWAP is no longer specified under the
heading “Bloomberg VWAP” on Bloomberg page TSN.N <equity> AQR (or its equivalent
successor if such page is not available) and Dealer disagrees on a good faith,
commercially reasonable basis with a determination of the “Daily VWAP” by
Counterparty pursuant to the Supplemental Indenture, the Calculation Agent may
make adjustments to such Daily VWAP as it, in its commercially reasonable
discretion, determines are appropriate.

 

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Settlement Averaging Period:

   For any Exercisable Option, the “Observation Period” for the related
Convertible Notes as defined in the Supplemental Indenture.

Settlement Date:

   For any Exercisable Option, the date Shares will be delivered with respect to
the Convertible Notes related to such Exercisable Options, under the terms of
the Supplemental Indenture.

Settlement Currency:

   USD

Other Applicable Provisions:

   The provisions of Sections 9.1(c), 9.8, 9.9, 9.11, 9.12 and 10.5 of the
Equity Definitions will be applicable, except that all references in such
provisions to “Physically-settled” shall be read as references to “Net Share
Settled”. “Net Share Settled” in relation to any Option means that Net Share
Settlement is applicable to that Option.

Representation and Agreement:

   Notwithstanding Section 9.11 of the Equity Definitions, the parties
acknowledge that any Shares delivered to Counterparty shall be, upon delivery,
subject to restrictions and limitations arising from Counterparty’s status as
issuer of the Shares under applicable securities laws. 3. Additional Terms
applicable to the Transaction:   

Adjustments applicable to the Transaction:

  

Potential Adjustment Events:

   Notwithstanding Section 11.2(e) of the Equity Definitions, a “Potential
Adjustment Event” means an occurrence of any event or condition, as set forth in
Section 4.04 of the Supplemental Indenture that would result in an adjustment to
the Conversion Rate of the Convertible Notes; provided that in no event shall
there be any adjustment hereunder as a result of an adjustment to the Conversion
Rate pursuant to Section 4.04(g), Section 4.04(h) or Section 4.06 of the
Supplemental Indenture.

Method of Adjustment:

   Calculation Agent Adjustment, and means that, notwithstanding Section 11.2(c)
of the Equity Definitions, upon any adjustment to the Conversion Rate of the
Convertible Notes pursuant to the Supplemental Indenture (other than Section
4.04(g), Section 4.04(h) and Section 4.06 of the Supplemental Indenture), the
Calculation Agent will make a corresponding adjustment to any one or more of the
Strike Price, Number of Options, Option Entitlement and any other variable
relevant to the exercise, settlement or payment for the Transaction.
Extraordinary Events applicable to the Transaction:   

Merger Events:

   Applicable; provided that notwithstanding Section 12.1(b) of the Equity
Definitions, a “Merger Event” means the occurrence of any event or condition set
forth in clauses (i) – (iv) of Section 4.07 of the Supplemental Indenture.

 

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Tender Offers:

   Applicable; provided that notwithstanding Section 12.1(d) of the Equity
Definitions, a “Tender Offer” means the occurrence of any event or condition set
forth in Section 4.04(e) of the Supplemental Indenture.

Consequence of Merger Events/Tender Offers:

   Notwithstanding Section 12.2 and Section 12.3 of the Equity Definitions, upon
the occurrence of a Merger Event or a Tender Offer, the Calculation Agent shall
make a corresponding adjustment in respect of any adjustment under the Indenture
to any one or more of the nature of the Shares, Strike Price, Number of Options,
Option Entitlement and any other variable relevant to the exercise, settlement
or payment for the Transaction; provided, however, that such adjustment shall be
made without regard to any adjustment to the Conversion Rate for the issuance of
additional shares as set forth in Section 4.06 of the Supplemental Indenture;
provided further that if, with respect to a Merger Event or a Tender Offer, (i)
the consideration for the Shares includes (or, at the option of a holder of
Shares, may include) shares of an entity or person not organized under the laws
of the United States, any State thereof or the District of Columbia or (ii) the
Counterparty to the Transaction following such Merger Event or Tender Offer,
will not be the Issuer following such Merger Event or Tender Offer, then
Cancellation and Payment (Calculation Agent Determination) shall apply.

Nationalization, Insolvency or Delisting:

   Cancellation and Payment (Calculation Agent Determination); provided that, in
addition to the provisions of Section 12.6(a)(iii) of the Equity Definitions, it
will also constitute a Delisting if the Exchange is located in the United States
and the Shares are not immediately re-listed, re-traded or re-quoted on any of
the New York Stock Exchange, the American Stock Exchange, The NASDAQ Global
Select Market or The NASDAQ Global Market (or their respective successors); if
the Shares are immediately re-listed, re-traded or re-quoted on any of the New
York Stock Exchange, the American Stock Exchange, The NASDAQ Global Select
Market or The NASDAQ Global Market (or their respective successors), such
exchange or quotation system shall thereafter be deemed to be the Exchange.

Additional Disruption Events:

  

Change in Law:

   Applicable

Failure to Deliver:

   Applicable

Determining Party:

   For all applicable Extraordinary Events, Dealer Non-Reliance:    Applicable
Agreements and Acknowledgements    Regarding Hedging Activities:    Applicable

 

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Additional Acknowledgments:    Applicable 4. Calculation Agent:    Dealer;
provided that all determinations made by the Calculation Agent shall be made in
good faith and in a commercially reasonable manner. Following any calculation by
the Calculation Agent hereunder and a prior written request by Counterparty, the
Calculation Agent shall provide Counterparty a written explanation of any
calculation or adjustment made by it including, where applicable, a description
of the methodology and the basis for such calculation or adjustment in
reasonable detail, it being understood that the Calculation Agent shall not be
obligated to disclose any proprietary models used by it for such calculation.

5. Account Details:

 

  (a) Account for payments to Counterparty:

JPMorgan Chase Bank

1 Chase Manhattan Plaza

New York, NY

ABA # 021000021

Account Name : Tyson Foods, Inc.

Account No. : 304182427

Account for delivery of Shares to Counterparty:

To be provided by Counterparty

 

  (b) Account for payments to Dealer:

JPMorgan Chase Bank, National Association, New York

ABA: 021 000 021

Favour: JPMorgan Chase Bank, National Association – London

A/C: 0010962009 CHASUS33

Account for delivery of Shares from Dealer:

DTC 0060

6. Offices:

The Office of Counterparty for the Transaction is: Inapplicable, Counterparty is
not a Multibranch Party.

The Office of Dealer for the Transaction is: London

JPMorgan Chase Bank, National Association

London Branch

P.O. Box 161

60 Victoria Embankment

London EC4Y 0JP

England

7. Notices: For purposes of this Confirmation:

 

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  (a) Address for notices or communications to Counterparty:

Tyson Foods, Inc.

2210 West Oaklawn Drive

Springdale, Arkansas 72762-6999

Attention: Treasurer

Telephone No.: (479) 290-4000

Facsimile No: (479) 757-6868

 

  (b) Address for notices or communications to Dealer:

JPMorgan Chase Bank, National Association

277 Park Avenue, 11th Floor

New York, NY 10172

Attention: Mariusz Kwasnik

Title: Operations Analyst

EDG Corporate Marketing

Telephone No: (212) 622-6707

Facsimile No: (212) 622-8534

8. Representations and Warranties of Counterparty

The representations and warranties of Counterparty set forth in Section 1 of the
Convertible Notes Underwriting Agreement (the “Underwriting Agreement”) dated as
of September 9, 2008 among Counterparty, J.P. Morgan Securities Inc. and Merrill
Lynch, Pierce, Fenner & Smith Incorporated as representatives of the
Underwriters are true and correct and are hereby deemed to be repeated to Dealer
as if set forth herein. Counterparty hereby further represents and warrants to
Dealer that:

 

  (a) Counterparty has all necessary corporate power and authority to execute,
deliver and perform its obligations in respect of this Transaction; such
execution, delivery and performance have been duly authorized by all necessary
corporate action on Counterparty’s part; and this Confirmation has been duly and
validly executed and delivered by Counterparty and constitutes its valid and
binding obligation, enforceable against Counterparty in accordance with its
terms, subject to applicable bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium and similar laws affecting creditors’ rights and
remedies generally, and subject, as to enforceability, to general principles of
equity, including principles of commercial reasonableness, good faith and fair
dealing (regardless of whether enforcement is sought in a proceeding at law or
in equity) and except that rights to indemnification and contribution hereunder
may be limited by federal or state securities laws or public policy relating
thereto.

 

  (b) Neither the execution and delivery of this Confirmation nor the incurrence
or performance of obligations of Counterparty hereunder will conflict with or
result in a breach of the certificate of incorporation or by-laws (or any
equivalent documents) of Counterparty, or any applicable law or regulation, or
any order, writ, injunction or decree of any court or governmental authority or
agency, or any agreement or instrument to which Counterparty or any of its
subsidiaries is a party or by which Counterparty or any of its subsidiaries is
bound or to which Counterparty or any of its subsidiaries is subject, or
constitute a default under, or result in the creation of any lien under, any
such agreement or instrument.

 

  (c) No consent, approval, authorization, or order of, or filing with, any
governmental agency or body or any court is required in connection with the
execution, delivery or performance by Counterparty of this Confirmation, except
such as have been obtained or made and such as may be required under the
Securities Act of 1933, as amended (the “Securities Act”) or state securities
laws.

 

  (d) Counterparty is not and will not be required to register as an “investment
company” as such term is defined in the Investment Company Act of 1940, as
amended.

 

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  (e) It is an “eligible contract participant” (as such term is defined in
Section 1a(12) of the Commodity Exchange Act, as amended (the “CEA”)) because
one or more of the following is true:

Counterparty is a corporation, partnership, proprietorship, organization, trust
or other entity and:

 

  (A) Counterparty has total assets in excess of USD 10,000,000;

 

  (B) the obligations of Counterparty hereunder are guaranteed, or otherwise
supported by a letter of credit or keepwell, support or other agreement, by an
entity of the type described in Section 1a(12)(A)(i) through (iv),
1a(12)(A)(v)(I), 1a(12)(A)(vii) or 1a(12)(C) of the CEA; or

 

  (C) Counterparty has a net worth in excess of USD 1,000,000 and has entered
into this Agreement in connection with the conduct of Counterparty’s business or
to manage the risk associated with an asset or liability owned or incurred or
reasonably likely to be owned or incurred by Counterparty in the conduct of
Counterparty’s business.

 

  (f) Each of it and its affiliates is not, on the date hereof, in possession of
any material non-public information with respect to Counterparty.

9. Other Provisions:

 

  (a) Opinions. Counterparty shall deliver to Dealer an opinion of counsel,
dated as of the Trade Date, with respect to the matters set forth in Sections
8(a) through (c) of this Confirmation.

 

  (b)

Repurchase Notices. Counterparty shall, on any day on which Counterparty effects
any repurchase of Shares, promptly give Dealer a written notice of such
repurchase (a “Repurchase Notice”) on such day if following such repurchase, the
number of outstanding Shares as determined on such day is (i) less than
268 million (in the case of the first such notice) or (ii) thereafter more than
15 million less than the number of Shares included in the immediately preceding
Repurchase Notice. Counterparty agrees to indemnify and hold harmless Dealer and
its affiliates and their respective officers, directors, employees, affiliates,
advisors, agents and controlling persons (each, an “Indemnified Person”) from
and against any and all losses (including losses relating to Dealer’s hedging
activities as a consequence of becoming, or of the risk of becoming, a
Section 16 “insider”, including without limitation, any forbearance from hedging
activities or cessation of hedging activities and any losses in connection
therewith with respect to this Transaction), claims, damages, judgments,
liabilities and expenses (including reasonable attorney’s fees), joint or
several, which an Indemnified Person may become subject to, as a result of
Counterparty’s failure to provide Dealer with a Repurchase Notice on the day and
in the manner specified in this paragraph, and to reimburse, within 30 days,
upon written request, each of such Indemnified Persons for any reasonable legal
or other expenses incurred in connection with investigating, preparing for,
providing testimony or other evidence in connection with or defending any of the
foregoing. If any suit, action, proceeding (including any governmental or
regulatory investigation), claim or demand shall be brought or asserted against
the Indemnified Person as a result of Counterparty’s failure to provide Dealer
with a Repurchase Notice in accordance with this paragraph, such Indemnified
Person shall promptly notify Counterparty in writing, and Counterparty, upon
request of the Indemnified Person, shall retain counsel reasonably satisfactory
to the Indemnified Person to represent the Indemnified Person and any others
Counterparty may designate in such proceeding and shall pay the fees and
expenses of such counsel related to such proceeding. Counterparty shall not be
liable for any settlement of any proceeding

 

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contemplated by this paragraph that is effected without its written consent, but
if settled with such consent or if there be a final judgment for the plaintiff,
Counterparty agrees to indemnify any Indemnified Person from and against any
loss or liability by reason of such settlement or judgment. Counterparty shall
not, without the prior written consent of the Indemnified Person, effect any
settlement of any pending or threatened proceeding contemplated by this
paragraph that is in respect of which any Indemnified Person is or could have
been a party and indemnity could have been sought hereunder by such Indemnified
Person, unless such settlement includes an unconditional release of such
Indemnified Person from all liability on claims that are the subject matter of
such proceeding on terms reasonably satisfactory to such Indemnified Person. If
the indemnification provided for in this paragraph is unavailable to an
Indemnified Person or insufficient in respect of any losses, claims, damages or
liabilities referred to therein, then Counterparty hereunder, in lieu of
indemnifying such Indemnified Person thereunder, shall contribute to the amount
paid or payable by such Indemnified Person as a result of such losses, claims,
damages or liabilities. The remedies provided for in this paragraph (b) are not
exclusive and shall not limit any rights or remedies which may otherwise be
available to any Indemnified Party at law or in equity. The indemnity and
contribution agreements contained in this paragraph shall remain operative and
in full force and effect regardless of the termination of this Transaction.

 

  (c) Regulation M. Counterparty is not on the date hereof engaged in a
distribution, as such term is used in Regulation M under the Securities Exchange
Act of 1934, as amended (the “Exchange Act”), of any securities of Counterparty,
other than (i) a distribution meeting the requirements of the exception set
forth in Rules 101(b)(10) and 102(b)(7) of Regulation M, (ii) the distribution
of the Convertible Notes and (iii) the distribution of Shares pursuant to a
prospectus dated September 4, 2008, as supplemented by the prospectus supplement
dated September 9, 2008. Counterparty shall not, until the second Scheduled
Trading Day immediately following the Effective Date, engage in any such
distribution.

 

  (d) No Manipulation. Counterparty is not entering into this Transaction to
create actual or apparent trading activity in the Shares (or any security
convertible into or exchangeable for the Shares) or to raise or depress or
otherwise manipulate the price of the Shares (or any security convertible into
or exchangeable for the Shares) or otherwise in violation of the Exchange Act.

 

  (e) Transfer or Assignment. (i) Counterparty shall have the right to transfer
or assign its rights and obligations hereunder with respect to all, but not less
than all, of the Options hereunder (such Options, the “Transfer Options”);
provided that such transfer or assignment shall be subject to reasonable
conditions that Dealer may impose, including, but not limited to, the following
conditions:

 

  (A) With respect to any Transfer Options, Counterparty shall not be released
from its notice and indemnification obligations pursuant to Section 9(b) or any
obligations under Section 9(o) or 9(t) of this Confirmation;

 

  (B) Any Transfer Options shall only be transferred or assigned to a third
party that is a United States person (as defined in the Internal Revenue Code of
1986, as amended);

 

  (C) Such transfer or assignment shall be effected on terms, including any
reasonable undertakings by such third party (including, but not limited to, an
undertaking with respect to compliance with applicable securities laws in a
manner that, in the reasonable judgment of Dealer, will not expose Dealer to
material risks under applicable securities laws) and execution of any
documentation and delivery of legal opinions with respect to securities laws and
other matters by such third party and Counterparty, as are requested and
reasonably satisfactory to Dealer;

 

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  (D) Dealer will not, as a result of such transfer and assignment, be required
to pay the transferee on any payment date an amount under Section 2(d)(i)(4) of
the Agreement greater than an amount that Dealer would have been required to pay
to Counterparty in the absence of such transfer and assignment;

 

  (E) An Event of Default, Potential Event of Default or Termination Event will
not occur as a result of such transfer and assignment;

 

  (F) Without limiting the generality of clause (B), Counterparty shall cause
the transferee to make such Payee Tax Representations and to provide such tax
documentation as may be reasonably requested by Dealer to permit Dealer to
determine that results described in clauses (D) and (E) will not occur upon or
after such transfer and assignment; and

 

  (G) Counterparty shall be responsible for all reasonable costs and expenses,
including reasonable counsel fees, incurred by Dealer in connection with such
transfer or assignment.

(ii) Dealer may, without Counterparty’s consent, transfer or assign all or any
part of its rights or obligations under the Transaction:

 

  (A) to any of Dealer’s affiliates whose obligations would be guaranteed by
Dealer; or

 

  (B) to any third party with a rating for its long term, unsecured and
unsubordinated indebtedness equal to or better than the lesser of (x) the credit
rating of Dealer at the time of the transfer and (y) A- by Standard and Poor’s
Rating Group, Inc. or its successor (“S&P”), or A3 by Moody’s Investor Service,
Inc. (“Moody’s”) or, if either S&P or Moody’s ceases to rate such debt, at least
an equivalent rating or better by a substitute rating agency mutually agreed by
Counterparty and Dealer, but only if:

 

  (a) Dealer, in its reasonable discretion, determines that (1) the number of
shares that Dealer Group directly or indirectly beneficially owns (within the
meaning of Section 13 of the Exchange Act and rules promulgated thereunder) is
more than 6% of Counterparty’s outstanding Shares or (2) the quotient of (x) the
product of (A) the Number of Options and (B) the Option Entitlement divided by
(y) the number of Counterparty’s outstanding Shares (such quotient expressed as
a percentage, the “Option Equity Percentage”) is more than 14.5%; and

 

  (b) Dealer determines that any of the following has occurred:
(1) Counterparty’s outstanding Shares (subject to any adjustments by the
Calculation Agent for share split, share combination or similar events) provided
herein, is less than 290 million;

(2) Counterparty has not fully performed its notice obligations under
Section 9(b); or

(3) based in part upon advice of counsel and as a result of events occurring
after the Trade Date, Dealer determines that it would be inadvisable for it to
engage in any alternative hedging transactions or other arrangements (other than
transfer, assignment or termination of this Transaction), which would enable it
to reduce its “beneficial ownership” (within the meaning of Section 13 of the
Exchange Act and rules promoted thereunder).

 

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Dealer shall promptly provide Counterparty a written notice of such transfer or
assignment pursuant to this clause (ii). “Dealer Group” means Dealer and each
business unit of its affiliates subject to aggregation with Dealer under
Section 13 of the Exchange Act and rules promulgated thereunder.

(iii) If after Dealer’s commercially reasonable efforts, Dealer is unable to
effect such a transfer or assignment pursuant to clause (ii) above, when the
Transaction is assignable or transferable pursuant to such clause, on pricing
terms reasonably acceptable to Dealer and within a time period reasonably
acceptable to Dealer, of a sufficient number of Options to reduce (1) the number
of shares that Dealer Group directly or indirectly beneficially owns (within the
meaning of Section 13 of the Exchange Act and rules promulgated thereunder) to
7.5% of Counterparty’s outstanding Shares or less or (2) the Option Equity
Percentage to 14.5% or less, Dealer may designate any Exchange Business Day as
an Early Termination Date with respect to a portion (the “Terminated Portion”)
of this Transaction, such that (1) the number of Shares that Dealer Group
directly or indirectly beneficially owns (within the meaning of Section 13 of
the Exchange Act and rules promulgated thereunder) following such partial
termination will be equal to or less than 7.5% of Counterparty’s outstanding
Shares or (2) the Option Equity Percentage following such partial termination
will be equal to or less than 14.5%. In the event that Dealer so designates an
Early Termination Date with respect to a portion of this Transaction, a payment
shall be made pursuant to Section 6 of the Agreement as if (1) an Early
Termination Date had been designated in respect of a Transaction having terms
identical to this Transaction and a Number of Options equal to the Terminated
Portion, (2) Counterparty shall be the sole Affected Party with respect to such
partial termination and (3) such Transaction shall be the only Terminated
Transaction (and, for the avoidance of doubt, the provisions of Section 9(l)
shall apply to any amount that is payable by Dealer to Counterparty pursuant to
this sentence as if Counterparty was not the Affected Party).

(iv) Notwithstanding any other provision in this Confirmation to the contrary
requiring or allowing Dealer to purchase, sell, receive or deliver any shares or
other securities to or from Counterparty, Dealer may designate any of its
affiliates to purchase, sell, receive or deliver such shares or other securities
and otherwise to perform Dealer’s obligations in respect of this Transaction and
any such designee may assume such obligations. Dealer shall be discharged of its
obligations to Counterparty to the extent of any such performance.

 

  (f) Staggered Settlement. If upon advice of counsel with respect to applicable
legal and regulatory requirements, including any requirements relating to
Dealer’s hedging activities hereunder, Dealer reasonably determines that it
would not be practicable or advisable to deliver, or to acquire Shares to
deliver, any or all of the Shares to be delivered by Dealer on the Settlement
Date for the Transaction, Dealer may, by notice to Counterparty on or prior to
any Settlement Date (a “Nominal Settlement Date”), elect to deliver the Shares
on two or more dates (each, a “Staggered Settlement Date”) as follows:

 

  (a) in such notice, Dealer will specify to Counterparty the related Staggered
Settlement Dates (all of which shall be on or prior to such Nominal Settlement
Date) and the number of Shares that it will deliver on each Staggered Settlement
Date;

 

  (b) the aggregate number of Shares that Dealer will deliver to Counterparty
hereunder on all such Staggered Settlement Dates will equal the number of Shares
that Dealer would otherwise be required to deliver on such Nominal Settlement
Date; and

 

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  (c) if the Net Share Settlement terms set forth above were to apply on the
Nominal Settlement Date, then the Net Share Settlement terms will apply on each
Staggered Settlement Date, except that the Net Shares will be allocated among
such Staggered Settlement Dates as specified by Dealer in the notice referred to
in clause (a) above.

 

  (g) Role of Agent. Each party agrees and acknowledges that (i) J.P. Morgan
Securities Inc., an affiliate of Dealer (“JPMSI”), has acted solely as agent and
not as principal with respect to this Transaction and (ii) JPMSI has no
obligation or liability, by way of guaranty, endorsement or otherwise, in any
manner in respect of this Transaction (including, if applicable, in respect of
the settlement thereof). Each party agrees it will look solely to the other
party (or any guarantor in respect thereof) for performance of such other
party’s obligations under this Transaction.

 

  (h) Dividends. If at any time during the period from and including the
Effective Date, to but excluding the Expiration Date, (i) an ex-dividend date
for a regular quarterly cash dividend occurs with respect to the Shares (an
“Ex-Dividend Date”), and that dividend is less than the Regular Dividend on a
per Share basis or (ii) if no Ex-Dividend date for a regular quarterly cash
dividend occurs with respect to the Shares in any quarterly dividend period of
Counterparty, then the Calculation Agent will make a corresponding adjustment to
any one or more of the Strike Price, Number of Options, Option Entitlement
and/or any other variable relevant to the exercise, settlement or payment for
the Transaction to preserve the fair value of the Options to Dealer after taking
into account such dividend or lack thereof. “Regular Dividend” shall mean USD
0.04 per Share per quarter.

 

  (i) Additional Termination Events. (i) Notwithstanding anything to the
contrary in this Confirmation, if an event of default with respect to
Counterparty shall occur under the terms of the Convertible Notes as set forth
in Section 5.01 of the Supplemental Indenture which results in acceleration of
Counterparty’s payment obligation under the Convertible Notes pursuant to the
terms of the Indenture, then such acceleration shall constitute an Additional
Termination Event applicable to the Transaction and, with respect to such event
of default (A) Counterparty shall be deemed to be the sole Affected Party and
the Transaction shall be the sole Affected Transaction and (B) Dealer shall be
the party entitled to designate an Early Termination Date pursuant to
Section 6(b) of the Agreement.

(ii) Notwithstanding anything to the contrary in this Confirmation, the giving
of any Notice of Exercise shall constitute an Additional Termination Event
hereunder with respect to the number, if any, of Exercisable Options specified
in such Notice of Exercise as corresponding to a conversion of Convertible Notes
to which the provisions of Section 4.06 of the Supplemental Indenture apply.
Upon receipt of any such Notice, Dealer shall designate an Exchange Business Day
as an Early Termination Date (such day to occur as close as practicable, in
Dealer’s commercially reasonable judgment, to the settlement date of the
relevant Convertible Notes), with respect to the portion of this Transaction
corresponding to number of such Exercisable Options so specified. The amount
payable by Dealer to Counterparty pursuant to Section 6 of the Agreement upon
such early termination shall be satisfied solely by delivery by Dealer to
Counterparty of a number of Shares (and cash in lieu of fractional Shares) equal
to the lesser of:

(1) the product of (i) the Applicable Percentage and (ii) the aggregate number
of Shares, if any, that Counterparty is required to deliver to the holders of
the relevant Convertible Notes, after taking into account any applicable
adjustments to the Conversion Rate pursuant to Section 4.06 of the Supplemental
Indenture and

 

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(2) the number of Shares equal to (i) the amount (the “Unwind Amount”)
calculated pursuant to Section 6 of the Agreement in respect of such Additional
Termination Event (without regard to this section) divided by (ii) a price per
Share determined by the Calculation Agent; provided that for the purposes of
determining the Unwind Amount, (A) Counterparty shall be the sole Affected Party
with respect to such Additional Termination Event, (B) Dealer shall be the party
entitled to designate an Early Termination Date pursuant to Section 6(b) of the
Agreement; and (C) for the avoidance of doubt, the Calculation Agent (i) shall
take into account the time value of this Transaction from the Early Termination
Date to the Expiration Date and (ii) shall not take into account any adjustments
to the Option Entitlement that result from corresponding adjustments to the
Conversion Rate pursuant to Section 4.06 of the Supplemental Indenture; provided
further that in case of a partial termination, an Early Termination Date shall
be designated in respect of a Transaction having terms identical to this
Transaction and a Number of Options equal to the terminated portion and such
Transaction shall be the only Terminated Transaction.

For the avoidance of doubt, (A) at the effective time of a Merger Event, each
Share shall be deemed a unit of Reference Property and (B) the number of Shares
(and cash in lieu of fractional Shares) payable by Dealer to Counterparty
pursuant to this Section 9(i)(ii) upon such early termination shall be no less
than the aggregate number of Net Shares for each Option terminated pursuant to
this Section 9(i)(ii), determined by the Calculation Agent as if such early
termination had not occurred, excluding any adjustments to the Option
Entitlement that result from corresponding adjustments to the Conversion Rate
pursuant to Section 4.06 of the Supplemental Indenture.

 

  (j) Amendments to Equity Definitions. (i) Section 12.6(a)(ii) of the Equity
Definitions is hereby amended by (1) deleting from the fourth line thereof the
word “or” after the word “official” and inserting a comma therefor, and
(2) deleting the semi-colon at the end of subsection (B) thereof and inserting
the following words therefor “or (C) at Dealer’s option, the occurrence of any
of the events specified in Section 5(a)(vii)(1) through (9) of the ISDA Master
Agreement with respect to that Issuer.”

(ii) Section 12.9(b)(i) of the Equity Definitions is hereby amended by
(1) replacing “either party may elect” with “Dealer may elect” and (2) replacing
“notice to the other party” with “notice to Counterparty” in the first sentence
of such section.

 

  (k) Setoff. Each party waives any and all rights it may have to setoff,
whether arising under any agreement, applicable law or otherwise.

 

  (l) Alternative Calculations and Payment on Early Termination and on Certain
Extraordinary Events. If in respect of this Transaction, an amount is payable by
Dealer to Counterparty (i) pursuant to Section 12.7 or Section 12.9 of the
Equity Definitions or (ii) pursuant to Section 6(d)(ii) of the Agreement (a
“Payment Obligation”), Counterparty may request Dealer to satisfy any such
Payment Obligation by the Share Termination Alternative (as defined below)
(except that Counterparty shall not make such an election in the event of a
Nationalization, Insolvency, a Merger Event or Tender Offer, in each case, in
which the consideration to be paid to holders of Shares consists solely of cash,
or an Event of Default in which Counterparty is the Defaulting Party or a
Termination Event in which Counterparty is the Affected Party, other than an
Event of Default of the type described in Section 5(a)(iii), (v), (vi), (vii) or
(viii) of the Agreement or a Termination Event of the type described in
Section 5(b) of the Agreement in each case that resulted from an event or events
outside Counterparty’s control) and shall give irrevocable telephonic notice to
Dealer, confirmed in writing within one Scheduled Trading Day, no later than
12:00 p.m. New York local time on the Merger Date, the Tender Offer Date, the
Announcement Date (in the case of Nationalization, Insolvency or Delisting), the
Early Termination Date or date of cancellation, as applicable. In calculating
any amounts under Section 6(e) of the Agreement, notwithstanding anything to the
contrary in the Agreement, (1) separate amounts shall be calculated as set forth
in Section 6(e) with respect to (i) this Transaction and (ii) all other
Transactions, and (2) such separate amounts shall be payable pursuant to
Section 6(d)(ii) of the Agreement.

 

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Share Termination Alternative:

   Applicable and means that Dealer shall deliver to Counterparty the Share
Termination Delivery Property on, or within a commercially reasonable period of
time after, the date when the Payment Obligation would otherwise be due pursuant
to Section 12.7 or 12.9 of the Equity Definitions or Section 6(d)(ii) and 6(e)
of the Agreement, as applicable (the “Share Termination Payment Date”), in
satisfaction of the Payment Obligation in the manner reasonably requested by
Counterparty free of payment.

Share Termination Delivery

Property:

   A number of Share Termination Delivery Units, as calculated by the
Calculation Agent, equal to the Payment Obligation divided by the Share
Termination Unit Price. The Calculation Agent shall adjust the Share Termination
Delivery Property by replacing any fractional portion of a security therein with
an amount of cash equal to the value of such fractional security based on the
values used to calculate the Share Termination Unit Price.

Share Termination Unit Price:

   The value to Dealer of property contained in one Share Termination Delivery
Unit, as determined by the Calculation Agent in its discretion by commercially
reasonable means and notified by the Calculation Agent to Dealer at the time of
notification of the Payment Obligation. For the avoidance of doubt, the parties
agree that in determining the Share Termination Delivery Unit Price the
Calculation Agent may consider the purchase price paid in connection with the
purchase of Share Termination Delivery Property.

Share Termination Delivery Unit:

   One Share or, if a Merger Event has occurred and a corresponding adjustment
to this Transaction has been made, a unit consisting of the number or amount of
each type of property received by a holder of one Share (without consideration
of any requirement to pay cash or other consideration in lieu of fractional
amounts of any securities) in such Merger Event, as determined by the
Calculation Agent.

Failure to Deliver:

   Applicable

 

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Other applicable provisions:

   If Share Termination Alternative is applicable, the provisions of Sections
9.8, 9.9, 9.11, 9.12 and 10.5 (as modified above) of the Equity Definitions will
be applicable, except that all references in such provisions to
“Physically-settled” shall be read as references to “Share Termination Settled”
and all references to “Shares” shall be read as references to “Share Termination
Delivery Units”. “Share Termination Settled” in relation to this Transaction
means that Share Termination Alternative is applicable to this Transaction.

 

  (m) Governing Law. New York law (without reference to choice of law doctrine).

 

  (n) Waiver of Jury Trial. Each party waives, to the fullest extent permitted
by applicable law, any right it may have to a trial by jury in respect of any
suit, action or proceeding relating to this Transaction. Each party
(i) certifies that no representative, agent or attorney of either party has
represented, expressly or otherwise, that such other party would not, in the
event of such a suit, action or proceeding, seek to enforce the foregoing waiver
and (ii) acknowledges that it and the other party have been induced to enter
into this Transaction, as applicable, by, among other things, the mutual waivers
and certifications provided herein.

 

  (o) Registration. Counterparty hereby agrees that if, in the good faith
reasonable judgment of Dealer, the Shares (“Hedge Shares”) acquired by Dealer
for the purpose of hedging its obligations pursuant to this Transaction cannot
be sold in the public market by Dealer without registration under the Securities
Act, whether upon termination, transfer or otherwise, Counterparty shall, at its
election, either (i) in order to allow Dealer to sell the Hedge Shares in a
registered offering, use commercially reasonable efforts to make available to
Dealer an effective registration statement under the Securities Act and enter
into an agreement, in form and substance reasonably satisfactory to Dealer,
substantially in the form of an underwriting agreement for a registered
secondary offering; provided, however, that if Dealer, in its sole reasonable
discretion, is not satisfied with access to due diligence materials, the results
of its due diligence investigation or the procedures and documentation for the
registered offering referred to above, or if Counterparty has not made available
to Dealer an effective registration statement under the Securities Act, then
clause (ii) or clause (iii) of this paragraph shall apply at the election of
Counterparty, (ii) in order to allow Dealer to sell the Hedge Shares in a
private placement, enter into a private placement agreement substantially
similar to private placement purchase agreements customary for the proposed
private placement of equity securities by similarly situated issuers, in form
and substance reasonably satisfactory to Dealer (in which case, the Calculation
Agent shall make any adjustments to the terms of this Transaction that are
necessary, in its reasonable judgment, to compensate Dealer for any discount
from the public market price of the Shares incurred on the sale of Hedge Shares
in a private placement), or (iii) purchase the Hedge Shares from Dealer at the
Reference Price on such Exchange Business Days, and in the amounts, requested by
Dealer.

 

  (p) Tax Disclosure. Effective from the date of commencement of discussions
concerning the Transaction, Counterparty and each of its employees,
representatives, or other agents may disclose to any and all persons, without
limitation of any kind, the tax treatment and tax structure of the Transaction
and all materials of any kind (including opinions or other tax analyses) that
are provided to Counterparty relating to such tax treatment and tax structure.

 

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  (q) Right to Extend. Dealer may postpone, in whole or in part, any Settlement
Date or any other date of valuation or delivery by Dealer or add additional
Settlement Dates or any other date of valuation or delivery, with respect to
some or all of the Options hereunder, if Dealer reasonably determines, in its
discretion, that such extension is reasonably necessary or appropriate to
preserve Dealer’s hedging or hedge unwind activity hereunder in light of
existing liquidity conditions (but only if there is a material decrease in
liquidity relative to Dealer’s expectations on the Trade Date) or to enable
Dealer to effect purchases of Shares in connection with its hedging, hedge
unwind or settlement activity hereunder in a manner that would, if Dealer were
Counterparty or an affiliated purchaser of Counterparty, be in compliance with
applicable legal, regulatory or self-regulatory requirements, or with related
policies and procedures applicable to Dealer.

 

  (r) Status of Claims in Bankruptcy. Dealer acknowledges and agrees that this
Confirmation is not intended to convey to Dealer rights against Counterparty
with respect to the Transaction that are senior to the claims of common
stockholders of Counterparty in any United States bankruptcy proceedings of
Counterparty; provided that nothing herein shall limit or shall be deemed to
limit Dealer’s right to pursue remedies in the event of a breach by Counterparty
of its obligations and agreements with respect to the Transaction; provided,
further, that nothing herein shall limit or shall be deemed to limit Dealer’s
rights in respect of any transactions other than the Transaction.

 

  (s) Securities Contract; Swap Agreement. The parties hereto intend for:
(a) the Transaction to be a “securities contract” and a “swap agreement” as
defined in the Bankruptcy Code (Title 11 of the United States Code) (the
“Bankruptcy Code”), and the parties hereto to be entitled to the protections
afforded by, among other Sections, Sections 362(b)(6), 362(b)(17), 546(e),
546(g), 555 and 560 of the Bankruptcy Code; (b) a party’s right to liquidate the
Transaction and to exercise any other remedies upon the occurrence of any Event
of Default under the Agreement with respect to the other party to constitute a
“contractual right” as described in the Bankruptcy Code; and (c) each payment
and delivery of cash, securities or other property hereunder to constitute a
“margin payment” or “settlement payment” and a “transfer” as defined in the
Bankruptcy Code.

 

  (t) Additional Provisions. Counterparty covenants and agrees that, as promptly
as practicable following the public announcement of any consolidation, merger
and binding share exchange to which Counterparty is a party, or any sale of all
or substantially all of Counterparty’s assets, in each case pursuant to which
the Shares will be converted into cash, securities or other property,
Counterparty shall notify Dealer in writing of the types and amounts of
consideration that holders of Shares have elected to receive upon consummation
of such transaction or event (the date of such notification, the “Consideration
Notification Date”); provided that in no event shall the Consideration
Notification Date be later than the date on which such transaction or event is
consummated.

 

  (u) Receipt or Delivery of Cash. For the avoidance of doubt, other than
payment of the Premium by Counterparty, nothing in this Confirmation shall be
interpreted as requiring Counterparty to cash settle this Transaction, except in
circumstances where such cash settlement is within Counterparty’s control
(including, without limitation, where Counterparty elects to receive or deliver
cash, where Counterparty fails timely to elect the Share Termination
Alternative, or where Counterparty has made Private Placement Settlement
unavailable due to the occurrence of events within its control ) or in those
circumstances in which holders of the Shares would also receive cash.

 

  (v) For the avoidance of doubt, in determining the amount payable pursuant to
Section 6 of the Agreement, the Calculation Agent shall take into account the
time value of this Transaction.

 

17

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LOGO [g95740jp_logo.jpg]

Please confirm that the foregoing correctly sets forth the terms of our
agreement by executing this Confirmation and returning it to EDG Confirmation
Group, J.P. Morgan Securities Inc., 277 Park Avenue, 11th Floor, New York, NY
10172-3401, or by fax to (212) 622 8519.

 

Very truly yours,   J.P. Morgan Securities Inc., as agent for JPMorgan Chase
Bank, National Association   By:   /s/ Sudheer Tegulapalle   Authorized
Signatory   Name: Sudheer Tegulapalle

Accepted and confirmed

as of the Trade Date:

 

Tyson Foods, Inc. By:   /s/ Dennis Leatherby Authorized Signatory Name: Dennis
Leatherby

JPMorgan Chase Bank, National Association

Organized under the laws of the United States as a National Banking Association

Main Office 1111 Polaris Parkway, Columbus, Ohio, 43271

Registered as a branch in England & Wales branch number BR000746.

Registered branch address 125 London Wall, London, EC2Y 5AJ.

Authorized and regulated by the Financial Services Authority.