EMPLOYMENT AGREEMENT

        THIS EMPLOYMENT AGREEMENT, made and entered into as of the 5th day of
December, 2005, by and between FRESH BRANDS, INC., a Wisconsin corporation (the
“Company”), PILLOW ACQUISITION CORP., a Wisconsin corporation (“Certified”), and
JOHN H. DAHLY (the “Executive”).

W I T N E S S E T H :

        WHEREAS, the Executive is employed by the Company in a key executive
capacity and the Executive’s services are valuable to the conduct of the
business of the Company;

        WHEREAS, the Company has entered into that certain Agreement and Plan of
Merger among Certified, Pillow Acquisition Corp. and the Company, dated as of
this date (the “Merger Agreement”) providing for the merger of Certified with
and into the Company (the “Merger”);

        WHEREAS, Certified and the Company desire to employ the Executive, and
the Executive desires to continue in employment with the Company or Certified,
for up to one year following the Effective Time of the Merger, as that term is
defined in the Merger Agreement;

        WHEREAS, Certified, the Company and the Executive desire to enter into
an employment agreement to be effective on the Effective Time of the Merger.

        NOW, THEREFORE, in consideration of the foregoing, the parties hereto
agree as follows:

        1.       Effective Date. This Agreement shall become effective on the
Effective Time of the Merger.

        2.       Employment Period. Certified or the Company will employ the
Executive from the Effective Time of the Merger through the first anniversary
thereof (the Employment Period), and the Executive will remain in the employ of
Certified or the Company as applicable, in accordance with and subject to the
terms and provisions of this Agreement.

        3.       Duties. During the Employment Period, the Executive shall, in
such capacities and positions as may be assigned by Certified or the Company to
the Executive, devote the Executive’s best efforts, attention and skill to the
business and affairs of Certified or the Company. The Executive shall report to
the President and Chief Executive Officer of Certified. The Executive shall
provide such services approximately three days per week on such schedule as
shall be agreed to by the Executive and the Company. The services which are to
be performed by the Executive hereunder are to be rendered in such place or
places as shall be mutually agreed upon in writing by the Executive and
Certified or the Company from time to time.

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        4.       Compensation. During the Employment Period, the Executive shall
be compensated as follows:

        (a)       Base Salary. The Executive shall receive, at such intervals
and in accordance with such standard policies of Certified or the Company as may
be in effect, an annual base salary in cash equivalent of not less than the
Executive’s annual base salary as in effect immediately prior to the Effective
Time of the Merger (subject to any deferral election then in effect), subject to
adjustment as provided under subsection (f). The Executive’s base salary shall
be paid in accordance with the normal payroll practices of the company that
employs the Executive.

        (b)       Reimbursement of Expenses. The Executive shall, at such
intervals and in accordance with such standard policies as may be in effect, be
reimbursed for any and all monies advanced in connection with the Executive’s
employment for reasonable and necessary expenses incurred by the Executive on
behalf of Certified, the Company or any of their Affiliates, including travel
expenses. For purposes of this Agreement, the term “Affiliate” shall have the
meaning ascribed to such term in Rule 12b-2 of the General Rules and Regulations
of the Securities Exchange Act of 1934, as amended.

        (c)       Salaried Employee Benefit Plans. The Executive shall be
included, to the extent eligible thereunder, in any and all plans providing
benefits for the salaried employees of the company by which the Executive is
employed in general, including but not limited to group life insurance,
hospitalization, medical, dental, profit sharing (including any 401(k) plan) and
stock bonus plans; provided, that, in no event shall the aggregate level of
benefits under such plans in which the Executive is included be less than the
aggregate level of benefits under plans of the type referred to in this Section
4(c) in which the Executive was participating immediately prior to the Effective
Time.

        (d)       Vacations and Holidays. The Executive shall annually be
entitled to not less than the amount of paid vacation and not fewer than the
number of paid holidays to which the Executive was entitled annually immediately
prior to the Effective Time or such greater amount of paid vacation and number
of paid holidays as may be made available annually to other executives of
Certified or the Company of comparable status and position to the Executive,
subject to adjustment as provided under subsection (f).

        (e)       Executive Benefit Plans. The Executive shall be included in
all plans providing additional benefits to executives of Certified or the
Company of comparable status and position to the Executive, including but not
limited to deferred compensation, split-dollar life insurance, supplemental
retirement, cash bonus, stock option, stock appreciation, stock bonus and
similar or comparable plans, but excluding any KEESA or similar severance
arrangement; provided, that, in no event shall the aggregate level of benefits
under such plans be less than the aggregate level of benefits under plans of the
type referred to in this Section 4(e) in which the Executive was participating
immediately prior to the Effective Time, subject to adjustment as provided under
subsection (f).

        (f)       Adjustment of Compensation. The amount paid to the Executive
each payroll period under subsection (a) shall be prorated to reflect the number
of business days the Executive actually works each payroll period. The
Executive’s entitlement to vacation accrual and executive benefit plan
participation opportunity (including but not limited to opportunity to receive
an annual bonus) shall be prorated based on the number of business days the
Executive is expected to work on an annual basis.

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        (g)       Compensation Accrued Prior to the Effective Time. Nothing
herein shall affect the amount of any compensation or benefits which the
Executive has earned or accrued, or to which the Executive is entitled, as of
the Effective Time under any plan, program or policy of the Company, including
but not limited to any amounts payable under the Company’s Executive Bonus Plan
for 2005 and any amount payable as a result of the termination of the
Executive’s Key Executive Employment and Severance Agreement dated December 15,
2003.

        5.       Termination of Employment. The Company or an Affiliate that
employs Executive may terminate the Executive at any time for any reason, and
the Executive may terminate employment at any time for any reason, by providing
at least thirty (30) days advance written notice thereof to the other party
(other than in the event of death). In the event of the Executive’s termination
of employment, the Executive shall be entitled to receive his Accrued Benefits.
For purposes of this Agreement, the Executive’s “Accrued Benefits” shall include
the following amounts, payable as described herein: (a) all base salary for the
time period ending with the termination date; (b) reimbursement for any and all
monies advanced in connection with the Executive’s employment for reasonable and
necessary expenses incurred by the Executive on behalf of Certified, the Company
or their Affiliates for the time period ending with the termination date; (c)
any and all other cash earned through the termination date and deferred at the
election of the Executive or pursuant to any deferred compensation plan then in
effect; (d) a payment of the bonus or incentive compensation otherwise payable
to the Executive with respect to the year in which termination occurs under all
bonus or incentive compensation plan or plans in which the Executive is a
participant; and (e) all other payments and benefits to which the Executive may
be entitled as compensatory fringe benefits or under the terms of any benefit
plan or practice as in effect immediately prior to the termination date. Payment
of Accrued Benefits shall be made promptly in accordance with the prevailing
practice with respect to Subsections (a) and (b) or, with respect to Subsections
(c), (d) and (e), pursuant to the terms of the benefit plan or practice
establishing such benefits.

        6.       Confidentiality Obligations of the Executive; Noncompetition.

        (a)        During and following the Executive’s employment by Certified
or the Company, the Executive shall hold in confidence and not directly or
indirectly disclose or use or copy or make lists of any confidential information
or proprietary data of Certified or the Company, except to the extent authorized
in writing by the Board of Directors of Certified or required by any court or
administrative agency, other than to an employee of Certified or the Company or
a person to whom disclosure is reasonably necessary or appropriate in connection
with the performance by the Executive of duties as an executive of Certified or
the Company, as applicable. Confidential information shall not include any
information known generally to the public or any information of a type not
otherwise considered confidential by persons engaged in the same business or a
business similar to that of Certified or the Company. All records, files,
documents and materials, or copies thereof, relating to the business of
Certified or the Company which the Executive shall prepare, or use, or come into
contact with, shall be and remain the sole property of Certified or the Company,
as applicable, and shall be promptly returned to Certified or the Company upon
termination of employment.

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        (b)        The Executive agrees that for a period of one year after his
date of termination of employment the Executive shall not, within the State of
Wisconsin or the State of Illinois, except as permitted by the Company’s prior
written consent (which shall not be unreasonably withheld), participate in the
management of any business which is a direct and substantial competitor of the
Company or one of its Affiliates. The ownership of less than five percent of any
class of securities of any corporation listed on a national securities exchange
or regularly traded over the counter even though such corporation may be a
competitor of the Company or one of its Affiliates as specified above, shall not
be deemed as constituting a financial interest in such competitor.

        7.       Payment Obligations Absolute. The Company’s obligation during
and after the Employment Period to pay the Executive the amounts and to make the
benefit and other arrangements provided herein shall be absolute and
unconditional and shall not be affected by any circumstances, including, without
limitation, any setoff, counterclaim, recoupment, defense or other right which
the Company may have against him or anyone else. All amounts payable by the
Company hereunder shall be paid without notice or demand. Each and every payment
made hereunder by the Company shall be final, and the Company will not seek to
recover all or any part of such payment from the Executive, or from whomsoever
may be entitled thereto, for any reason whatsoever.

        8.       Successors.

        (a)        This Agreement and all rights of the Company or any Affiliate
hereunder shall inure to the benefit of and be binding on any successor to such
Company or any Affiliate.

        (b)        This Agreement and all rights of the Executive shall inure to
the benefit of and be enforceable by the Executive’s personal or legal
representatives, executors, administrators, heirs and beneficiaries.

        9.       Severability. The provisions of this Agreement shall be
regarded as divisible, and if any of said provisions or any part hereof are
declared invalid or unenforceable by a court of competent jurisdiction, the
validity and enforceability of the remainder of such provisions or parts hereof
and the applicability thereof shall not be affected thereby.

        10.       Amendment. This Agreement may not be amended or modified at
any time except by written instrument executed by the Company and the Executive.

        11.       Certain Rules of Construction. No party shall be considered as
being responsible for the drafting of this Agreement for the purpose of applying
any rule construing ambiguities against the drafter or otherwise. No draft of
this Agreement shall be taken into account in construing this Agreement. Any
provision of this Agreement which requires an agreement in writing shall be
deemed to require that the writing in question be signed by the Executive and an
authorized representative of the Company.

        12.       Governing Law; Resolution of Disputes. This Agreement and the
rights and obligations hereunder shall be governed by and construed in
accordance with the laws of the State of Wisconsin. Any dispute arising out of
this Agreement shall, at the Executive’s election, be determined by arbitration
under the rules of the American Arbitration Association then in effect or by
litigation. Whether the dispute is to be settled by arbitration or litigation,
the venue for the arbitration or litigation shall be Sheboygan, Wisconsin or, at
the Executive’s election, if the Executive is no longer residing or working in
the Sheboygan, Wisconsin metropolitan area, in the judicial district
encompassing the city in which the Executive resides. The parties consent to
personal jurisdiction in each trial court in the selected venue having subject
matter jurisdiction notwithstanding their residence or situs, and each party
irrevocably consents to service of process in the manner provided hereunder for
the giving of notices.

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        13.       Notice. Notices given pursuant to this Agreement shall be in
writing and shall be deemed given when actually received by the Executive or
actually received by the Company’s Secretary or any officer of the Company other
than the Executive. If mailed, such notices shall be mailed by United States
registered or certified mail, return receipt requested, addressee only, postage
prepaid, if to the Company or any of its Affiliates, to Certified Grocers
Midwest, Inc., Attention: Kenneth R. Koester, President and Chief Executive
Officer, One Certified Drive, Hodgkins, Illinois 60525, or if to the Executive,
at the address set forth below the Executive’s signature to this Agreement, or
to such other address as the party to be notified shall have theretofore given
to the other party in writing.

        14.       No Waiver. No waiver by either party at any time of any breach
by the other party of, or compliance with, any condition or provision of this
Agreement to be performed by the other party shall be deemed a waiver of similar
or dissimilar provisions or conditions at the same time or any prior or
subsequent time.

        15.       Headings. The headings herein contained are for reference only
and shall not affect the meaning or interpretation of any provision of this
Agreement.

        IN WITNESS WHEREOF, the parties have executed this Agreement as of the
day and year first written above.

FRESH BRANDS, INC.

  By  /s/ Walter G. Winding        Walter G. Winding, III        Chairman of the
Board

  PILLOW ACQUISITION CORP.

  By  /s/ Kenneth R. Koester        Kenneth R. Koester        President and
Chief Executive Officer

  EXECUTIVE

  /s/ John Dahly John Dahly Address: 2051 W. Hidden Reserve Circle Mequon, WI
53092

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