<PAGE>

================================================================================

                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                   ----------
                              Form 10-Q Equivalent
                                   ----------

      (Mark One)

           [ ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                         SECURITIES EXCHANGE ACT OF 1934

                For the quarterly period ended December 24, 2005

                                       OR

          [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                         SECURITIES EXCHANGE ACT OF 1934

             For the transition period from __________ to __________

                           Commission File Number N/A
                                                  ---

                              BIRDS EYE FOODS, INC.
             (Exact Name of Registrant as Specified in its Charter)

             Delaware                                       16-0845824
 (State or other jurisdiction of                           (IRS Employer
 incorporation or organization)                       Identification Number)

          90 Linden Oaks, PO Box 20670, Rochester, NY      14602-6070
            (Address of Principal Executive Offices)        (Zip Code)

       Registrant's Telephone Number, Including Area Code: (585) 383-1850

Indicate  by check  mark  whether  the  registrant:  (1) has filed  all  reports
required to be filed by Section 13 or 15(d) of the  Securities  Exchange  Act of
1934  during  the  preceding  12 months  (or for such  shorter  period  that the
registrant was required to file such reports),  and (2) has been subject to such
filing requirements for the past 90 days.

                                YES [ ]   NO [ ]

Indicate by check mark whether the registrant is a large  accelerated  filer, an
accelerated  filer or a  non-accelerated  filer.  See definition of "accelerated
filer and large  accelerated  filer" in Rule 12b-2 of the Exchange  Act.  (Check
one):

   Large accelerated filer [ ] Accelerated filer [ ] Non-accelerated filer [X]

Indicate by check mark whether the  registrant is a Shell Company (as defined in
Exchange Act Rule 12b-2 of the Exchange Act).

                                YES [ ]   NO [X]

Indicate the number of shares  outstanding  of each of the  issuer's  classes of
common stock as of the latest practicable date. As of February 3, 2006.

                              Common Stock: 11,000

   o This Form 10-Q Equivalent is only being filed pursuant to a requirement
  contained in the indenture governing Birds Eye Foods, Inc.'s 11 7/8 Percent
                      Senior Subordinated Notes Due 2008.

================================================================================

                                        1





<PAGE>

                          PART I. FINANCIAL INFORMATION

ITEM 1.   FINANCIAL STATEMENTS.

Birds Eye Foods, Inc.
Consolidated Statements of Operations, Accumulated Earnings, and Comprehensive
Income
(Dollars in Thousands)
(Unaudited)

<TABLE>
<CAPTION>
                                                                    Three Months Ended               Six Months Ended
                                                               ----------------------------    ----------------------------
                                                               December 24,    December 25,    December 24,    December 25,
                                                                   2005            2004            2005            2004
                                                               ------------    ------------    ------------    ------------
<S>                                                            <C>             <C>             <C>             <C>
Net sales                                                      $    280,190    $    266,473    $    476,846    $    443,817
Cost of sales                                                      (217,407)       (201,550)       (378,726)       (344,540)
                                                               ------------    ------------    ------------    ------------
Gross profit                                                         62,783          64,923          98,120          99,277
Selling, administrative, and general expense                        (29,961)        (32,036)        (57,413)        (60,400)
Restructuring                                                             0               0          (4,492)              0
Other (expense)/income                                                 (612)          2,199            (612)          2,199
                                                               ------------    ------------    ------------    ------------
Operating income                                                     32,210          35,086          35,603          41,076
Interest expense                                                     (8,473)         (7,280)        (16,314)        (13,636)
                                                               ------------    ------------    ------------    ------------
Pretax income from continuing operations                             23,737          27,806          19,289          27,440
Tax provision                                                        (9,257)        (11,098)         (7,523)        (10,952)
                                                               ------------    ------------    ------------    ------------
Income from continuing operations                                    14,480          16,708          11,766          16,488
Discontinued operations, net of tax                                       0               0            (281)              0
                                                               ------------    ------------    ------------    ------------
Net income                                                     $     14,480    $     16,708    $     11,485    $     16,488
                                                               ============    ============    ============    ============

Accumulated earnings at beginning of period                          68,233          52,403          71,228          52,623
                                                               ------------    ------------    ------------    ------------
Accumulated earnings at end of period                          $     82,713    $     69,111    $     82,713    $     69,111
                                                               ============    ============    ============    ============

Net income                                                     $     14,480    $     16,708    $     11,485    $     16,488
Other comprehensive income/(loss):
   Minimum pension liability, net of taxes                                0               0            (175)              0
   Unrealized gain/(loss) on hedging activity, net of taxes             114             (35)            (64)            110
                                                               ------------    ------------    ------------    ------------
Comprehensive income                                           $     14,594    $     16,673    $     11,246    $     16,598
                                                               ============    ============    ============    ============
</TABLE>

The accompanying notes are an integral part of these consolidated financial
statements.

                                        2





<PAGE>

Birds Eye Foods, Inc.
Consolidated Balance Sheets
(Dollars in Thousands, Except for Per Share Information)
(Unaudited)

<TABLE>
<CAPTION>
                                                                                December 24,     June 25,
                                                                                    2005           2005
                                                                                ------------    ----------
<S>                                                                             <C>             <C>
                                                  ASSETS

Current assets:
   Cash and cash equivalents                                                    $      5,986    $   36,002
   Accounts receivable trade, net of allowances for doubtful accounts                 71,362        60,208
   Accounts receivable, other                                                          6,789         4,011
   Income taxes refundable                                                                 0           269
   Inventories, net                                                                  260,873       196,287
   Current investment in CoBank                                                          355           383
   Prepaid manufacturing expense                                                       2,415        12,108
   Prepaid expenses and other current assets                                          10,192         9,696
   Held for sale assets                                                                  149         5,497
   Current deferred tax asset                                                          5,383         5,276
                                                                                ------------    ----------
         Total current assets                                                        363,504       329,737
Investment in CoBank                                                                     548           719
Property, plant and equipment, net of accumulated depreciation of
  $67,467 and $56,826, respectively                                                  184,020       191,637
Goodwill                                                                              45,104        45,101
Trademarks and other intangible assets, net                                          221,025       222,496
Other assets                                                                          11,983        14,834
                                                                                ------------    ----------
         Total assets                                                           $    826,184    $  804,524
                                                                                ============    ==========

                                   LIABILITIES AND SHAREHOLDER'S EQUITY

Current liabilities:
   Current portion of obligations under capital leases                          $        841    $      865
   Current portion of long-term debt                                                   2,700         2,700
   Current portion of Termination Agreement with Pro-Fac Cooperative, Inc.             9,621         9,455
   Accounts payable                                                                   59,845        78,597
   Income taxes payable                                                                  807             0
   Accrued interest                                                                    2,252         2,144
   Accrued employee compensation                                                       8,247         7,296
   Other accrued liabilities                                                          51,711        44,334
   Held for sale liabilities                                                               0         2,014
   Growers payable due to Pro-Fac Cooperative, Inc.                                   15,761         8,395
                                                                                ------------    ----------
         Total current liabilities                                                   151,785       155,800
Obligations under capital leases                                                       1,985         2,373
Long-term debt                                                                       315,826       298,548
Long-term portion of Termination Agreement with Pro-Fac Cooperative, Inc.              3,453         8,836
Other non-current liabilities                                                         63,074        67,228
Non-current deferred tax liability                                                    18,880        12,353
                                                                                ------------    ----------
         Total liabilities                                                           555,003       545,138
                                                                                ------------    ----------
Commitments and contingencies
Shareholder's Equity:
   Common stock, par value $.01; 11,000 shares
     authorized, issued and outstanding                                                    0             0
   Additional paid-in capital                                                        203,364       202,815
   Accumulated earnings                                                               82,713        71,228
   Accumulated other comprehensive income/(loss):
     Unrealized gain on hedging activity, net of taxes                                    47           111
     Minimum pension liability adjustment, net of taxes                              (14,943)      (14,768)
                                                                                -------------   ----------
         Total shareholder's equity                                                  271,181       259,386
                                                                                ------------    ----------
         Total liabilities and shareholder's equity                             $    826,184    $  804,524
                                                                                ============    ==========
</TABLE>

The accompanying notes are an integral part of these consolidated financial
statements.

                                        3





<PAGE>

Birds Eye Foods, Inc.
Consolidated Statements of Cash Flows
(Dollars in Thousands)
(Unaudited)

<TABLE>
<CAPTION>
                                                                                              Six Months Ended
                                                                                   --------------------------------------
                                                                                   December 24, 2005    December 25, 2004
                                                                                   -----------------    -----------------
<S>                                                                                <C>                  <C>
Cash Flows From Operating Activities:
   Net income                                                                      $          11,485    $          16,488
   Adjustments to reconcile net income to net cash used in operating activities-
         Asset impairment charge within discontinued operations                                  454                    0
         Restructuring charge                                                                  4,492                    0
         Restructuring payments                                                                 (517)                   0
         Other expense/(income)                                                                  612               (2,199)
         Amortization of certain intangible assets                                             1,471                1,271
         Depreciation                                                                         11,751               11,299
         Gain on derivative instruments                                                         (281)                (608)
         Amortization of debt issue costs, amendment costs, and debt premiums                  3,433                3,560
         Gain on sale of assets                                                                  (11)                 (79)
         Transitional Services Agreement with Pro-Fac Cooperative, Inc.                            0                  (70)
         Provision for deferred taxes                                                          6,527                  855
         Provision for losses on accounts receivable                                             177                  240
   Change in assets and liabilities, excluding effects of acquisitions:
      Accounts receivable                                                                    (14,109)             (14,635)
      Inventories and prepaid manufacturing expense                                          (55,671)             (56,287)
      Income taxes refundable/payable                                                            960               10,120
      Accounts payable and other accrued liabilities                                         (12,370)              (1,199)
      Due to Pro-Fac Cooperative, Inc., net                                                    7,367                9,278
      Other assets and liabilities, net                                                       (5,173)               1,819
                                                                                   -----------------    -----------------
Net cash used in operating activities                                                        (39,403)             (20,147)
                                                                                   -----------------    -----------------

Cash Flows From Investing Activities:
   Purchase of property, plant and equipment                                                  (5,568)              (9,878)
   Proceeds from disposals                                                                     3,189                  154
   Acquisition of California & Washington Company                                                  0              (73,455)
   Proceeds from investment in CoBank                                                            199                  918
   Proceeds from note receivable to Pro-Fac Cooperative, Inc., net                                 0                1,000
                                                                                   -----------------    -----------------
Net cash used in investing activities                                                         (2,180)             (81,261)
                                                                                   -----------------    -----------------

Cash Flows From Financing Activities:
   Net proceeds from Revolving Credit Facility                                                18,800               40,300
   Payments on long-term debt                                                                 (1,350)              (1,350)
   Payments on Termination Agreement with Pro-Fac Cooperative, Inc.                           (6,000)              (6,000)
   Payments on capital leases                                                                   (432)                (436)
   Birds Eye Holdings, Inc. investment, net                                                      549                   37
                                                                                   -----------------    -----------------
Net cash provided by financing activities                                                     11,567               32,551
                                                                                   -----------------    -----------------
Net change in cash and cash equivalents                                                      (30,016)             (68,857)
Cash and cash equivalents at beginning of period                                              36,002               72,887
                                                                                   -----------------    -----------------
Cash and cash equivalents at end of period                                         $           5,986    $           4,030
                                                                                   =================    =================

Supplemental Disclosure of Cash Flow Information:
   Cash paid during the period for:
      Interest, net of amounts capitalized                                         $          12,719    $           9,055
                                                                                   =================    =================
      Income taxes received, net                                                   $             186    $              24
                                                                                   =================    =================

Supplemental schedule of non-cash operating, investing and financing activities:
      Capital lease obligations incurred                                           $              28    $             200
                                                                                   =================    =================
      Property, plant and equipment purchases included in accounts payable         $             336    $             649
                                                                                   =================    =================
</TABLE>

The  accompanying  notes are an integral  part of these  consolidated  financial
statements.

                                        4





<PAGE>

                              BIRDS EYE FOODS, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1.   DESCRIPTION OF BUSINESS AND SUMMARY OF CERTAIN SIGNIFICANT ACCOUNTING
POLICIES

The  Company:  Birds Eye Foods,  Inc.  (the  "Company"  or "Birds  Eye  Foods"),
incorporated  in 1961,  is a producer and marketer of processed  food  products.
Birds  Eye  Foods is a  wholly  owned  subsidiary  of Birds  Eye  Holdings  Inc.
("Holdings  Inc.").  The Company has three primary  segments in which it markets
its  products,  they  include:  branded  frozen,  branded dry,  and  non-branded
products.  The majority of each of the segments' net sales are within the United
States. All of the Company's operating facilities are within the United States.

On August 23,  2005,  the  Company  sold its  Mexican  subsidiary,  Birds Eye de
Mexico,  S.A.  de C.V.  ("BEMSA")  and all of its  production  assets in Celaya,
Mexico.  See NOTE 3 to the  "Notes to  Consolidated  Financial  Statements"  for
additional disclosures regarding this transaction.

Basis  of  Presentation:   The  accompanying  unaudited  consolidated  financial
statements have been prepared in accordance with accounting principles generally
accepted  in the  United  States  of  America  ("GAAP")  for  interim  financial
information and in accordance with the  requirements of Form 10-Q and Article 10
of  Regulation  S-X.  Accordingly,  they do not include  all of the  information
required by GAAP for complete financial statement  presentation.  In the opinion
of management, all adjustments (consisting only of normal recurring adjustments)
necessary  for a  fair  presentation  of  the  financial  position,  results  of
operations,  and cash flows have been  included.  Operating  results for the six
months ended  December 24, 2005 are not  necessarily  the results to be expected
for future interim periods or the full year. These financial  statements  should
be read in  conjunction  with the financial  statements and  accompanying  notes
contained in the Company's  Form 10-K  Equivalent for the fiscal year ended June
25, 2005.

Consolidation: The consolidated financial statements include the Company and its
wholly-owned  subsidiaries  after  elimination of intercompany  transactions and
balances.

Reclassification:  Net cash used in  operating  activities  and net cash used in
investing activities in the accompanying  Consolidated  Statements of Cash Flows
were adjusted by $0.5 million in the first six months of fiscal 2005, to reflect
non-cash property, plant and equipment purchases.

New  Accounting  Pronouncements:  In September  2005,  the Financial  Accounting
Standards Board ("FASB") Emerging Issues Task Force ("EITF") reached a consensus
on EITF Issue No. 04-13,  "Accounting  for Purchases and Sales of Inventory with
the Same  Counterparty."  The EITF concluded that inventory  purchases and sales
transactions  with the same  counterparty that are entered into in contemplation
of one another should be combined and considered a single transaction subject to
APB Opinion No. 29, "Accounting for Nonmonetary Transactions." The EITF provided
indicators  to  be  considered   for  purposes  of   determining   whether  such
transactions are entered into in contemplation of each other.  Guidance was also
provided on the  circumstances  under which  nonmonetary  exchanges of inventory
within the same line of business  should be recognized  at fair value.  EITF No.
04-13 is effective  in reporting  periods  beginning  after March 15, 2006.  The
Company is currently  evaluating the effect, if any, that the  implementation of
EITF No. 04-13 will have on its results of operations,  cash flows, or financial
condition.

In June  2005,  the FASB  EITF  reached  a  consensus  on EITF  Issue  No.  05-6
"Determining the  Amortization  Period for Leasehold  Improvements  Purchased or
Acquired  after  Lease  Inception  in a Business  Combination."  This EITF issue
provides guidance on the amortization period for leasehold improvements acquired
in a business combination and the amortization period of leasehold  improvements
that are  placed in  service  significantly  after and not  contemplated  at the
beginning  of the  lease  term.  The  guidance  contained  in EITF  No.  05-6 is
effective for periods  beginning  after June 29, 2005.  The adoption of EITF No.
05-6 did not have a material effect on its results of operations, cash flows, or
financial condition.

In May  2005,  the FASB  issued  Statement  of  Financial  Accounting  Standards
("SFAS")  No.  154,  Accounting  Changes  and Error  Corrections.  SFAS No.  154
replaces APB No. 20, Accounting  Changes,  and SFAS No. 3, Reporting  Accounting
Changes  in  Interim  Financial   Statements,   and  establishes   retrospective
application  as the  required  method  for  reporting  a  change  in  accounting
principle.  SFAS No. 154 provides guidance for determining whether retrospective
application  of a  change  in  accounting  principle  is  impracticable  and for
reporting  a  change  when  retrospective  application  is  impracticable.   The
reporting of a correction of an error by restating  previously  issued financial
statements is also addressed.  SFAS No. 154 is effective for accounting  changes
and  corrections  of errors made in fiscal years  beginning  after  December 15,
2005.  The Company  does not  anticipate  that the adoption of SFAS No. 154 will
have a material  impact on its results of operations,  cash flows,  or financial
condition.

In December 2004, the FASB issued SFAS No. 153, "Exchanges of Nonmonetary Assets
- an amendment of APB Opinion No. 29".  SFAS No. 153  eliminates  the  exception
from fair value  measurement  for  nonmonetary  exchanges of similar  productive
assets,  and  replaces  it with an  exception  for  exchanges  that do not  have
commercial substance.  SFAS No. 153 is effective for nonmonetary asset exchanges
occurring in fiscal periods  beginning after June 15, 2005. The adoption of SFAS
No. 153 did not have a material  effect on

                                        5





<PAGE>

the Company's results of operations, cash flows, or financial condition.

In December 2004, the FASB issued Staff Position No. 109-1, "Application of FASB
Statement  No.  109,  Accounting  for  Income  Taxes,  to the Tax  Deduction  on
Qualified  Production  Activities  Provided by the American Jobs Creation Act of
2004." FSP 109-1 clarifies that the manufacturer's  deduction provided for under
the American  Jobs  Creation  Act of 2004 should be  accounted  for as a special
deduction in accordance with SFAS No. 109 and not as a tax rate  reduction.  The
adoption  of FSP No.  109-1 did not have a  material  effect on its  results  of
operations, cash flows, or financial condition.

In November 2004, the FASB issued SFAS No. 151,  "Inventory Costs - an amendment
of ARB No. 43,  Chapter  4." SFAS No. 151 amends  previous  accounting  guidance
regarding  allocation of fixed production costs to inventory and the recognition
of overheads  and other  expenses.  SFAS No. 151 is  effective  for fiscal years
beginning  after  June 15,  2005.  The  adoption  of SFAS No. 151 did not have a
material effect on the Company's results of operations, cash flows, or financial
condition.

In May 2004, the FASB issued Staff Position  ("FSP") No. 106-2,  "Accounting and
Disclosure  Requirements Related to the Medicare Prescription Drug,  Improvement
and   Modernization  Act  of  2003"  ("Act")  which  requires  measures  of  the
accumulated  postretirement  benefit obligation and net periodic  postretirement
benefit cost to reflect the effects of the Act. Detailed  regulations  necessary
to  implement  the Act and  determine  "actuarial  equivalency"  were  issued on
January 21, 2005.  The Company has  evaluated  these  regulations  and while the
Company  expects  that it may be entitled to the federal  subsidy for certain of
its plans,  it was  determined  that the  administrative  costs of obtaining the
subsidy meet or exceed any potential  subsidy  benefit.  Therefore,  the amounts
included in the financial  statements  related to the employer's  postretirement
benefit  plans do not reflect the effects of the Act. See further  disclosure at
NOTE 7 to the  "Notes  to  Consolidated  Financial  Statements"  for  additional
disclosures regarding pension and postretirement benefits.

Trade  Accounts  Receivable:  The  Company  accounts  for trade  receivables  at
outstanding billed amounts, net of allowances for doubtful accounts. The Company
estimates  its allowance  for doubtful  accounts as a percentage of  receivables
overdue. Also included in the allowance,  in their entirety,  are those accounts
that have filed for bankruptcy, been sent to collections, and any other accounts
management  believes are not collectible  based on historical  information.  The
Company periodically reviews the accounts included in the allowance to determine
those to be written off. Generally, after a period of one year, or through legal
counsel's  advice,  accounts are written off. It is not Company policy to accrue
interest on past due accounts. The Company's allowance for doubtful accounts was
approximately  $1.2 million at December  24, 2005,  and $1.1 million at June 25,
2005.

Additional  Paid-In  Capital:  The change in additional  paid-in capital results
from Holdings LLC and Holdings Inc. investment of $0.5 million in the Company.

Comprehensive Income: Under SFAS No. 130, "Reporting  Comprehensive Income," the
Company is required to display  comprehensive  income and its components as part
of the consolidated  financial statements.  Comprehensive income is comprised of
net income and other comprehensive income/(loss), which includes certain changes
in equity that are excluded from net income.  The Company  includes  adjustments
for  minimum  pension  liabilities  and  unrealized  gains and losses on hedging
transactions  in other  comprehensive  income.  The income taxes  related to the
Company's minimum pension liabilities  amounted to a $0.1 million tax benefit in
other  comprehensive  income/(loss)  for the six months ended December 24, 2005.
The income taxes related to the Company's unrealized gains and losses on hedging
transactions  amounted  to  approximately  a $0.1  million tax  provision  and a
$24,000 tax benefit,  respectively, in other comprehensive income/(loss) for the
three  months ended  December  24, 2005 and December 25, 2004.  The income taxes
related to the  Company's  unrealized  gains and losses on hedging  transactions
amounted  to  approximately  a  $43,000  tax  benefit  and a  $0.1  million  tax
provision, respectively, in other comprehensive income/(loss) for the six months
ended December 24, 2005 and December 25, 2004.

Earnings Per Share Data  Omitted:  The guidance of SFAS No. 128,  "Earnings  per
Share,"  requires  presentation  of earnings per share by all entities that have
issued  common stock or potential  common stock if those  securities  trade in a
public  market  either  on a stock  exchange  (domestic  or  foreign)  or in the
over-the-counter  market.  Birds Eye Foods common  stock is not publicly  traded
and, therefore, earnings per share amounts are not presented.

NOTE 2.   ACQUISITION

On September  23,  2004,  Birds Eye Foods  acquired the  California & Washington
Company ("C&W"), a San Francisco-based marketer of frozen vegetables and fruits,
by acquiring all of the outstanding common stock of C&W (the  "Acquisition") for
an aggregate  purchase price of  approximately  $74.3 million,  including direct
costs.

C&W is the  premier  marketer  of frozen  vegetables  and fruits in the  Western
United States, with number one branded market share positions in California, the
Pacific  Northwest,  and  Arizona.  The Company  believes  the  Acquisition  has
strengthened  its competitive  position by expanding its presence in the Western
United States.

                                        6





<PAGE>

The Acquisition was accounted for under the purchase method of accounting and in
accordance  with  SFAS  No.  141,   "Business   Combinations".   Under  purchase
accounting,  the  Company  allocated  the  purchase  price to the  tangible  and
identifiable  intangible  assets  acquired and  liabilities  assumed.  Each were
recorded at their respective fair values. The final allocation of purchase price
is presented below and is based on management's  estimates of fair value derived
from independent  valuations and other studies which provided the basis for such
estimates.  The goodwill  associated with this transaction is deductible for tax
purposes.

In  accordance  with GAAP,  the excess of the cost of C&W over the fair value of
the  identifiable  assets and  liabilities of C&W as of the final  allocation of
purchase price was approximately $9.8 million.

(Dollars in Thousands)

                                                Amount
                                               --------

   Accounts receivable                         $  3,437
   Inventories                                    3,336
   Prepaid expenses and other current assets         52
   Property, plant and equipment                     22
   Goodwill                                       9,750
   Trademarks and other intangibles              61,070
   Accounts payable                              (1,696)
   Accrued employee compensation                   (276)
   Other accrued liabilities                     (1,405)
                                               --------
      Total allocation                         $ 74,290
                                               ========

The results of operations of C&W subsequent to the  Acquisition  are included in
the Company's Consolidated Statements of Operations. The following unaudited pro
forma  financial  information  presents  a summary  of  consolidated  results of
operations of the Company as if the Acquisition had occurred at the beginning of
the period presented:

(Dollars in Thousands)

                                            Six months ended
                                              December 25,
                                                  2004
                                            ----------------
Net sales                                   $        450,375
Income from continuing operations                     16,243
Net income                                            16,243

These  unaudited pro forma results have been prepared for  comparative  purposes
only  and  primarily  include  adjustments  for  interest  expense,   taxes  and
amortization.  These  results do not purport to be  indicative of the results of
operations which actually would have resulted had this  Acquisition  occurred at
the  beginning  of the first  quarter of the fiscal 2005 year,  or of the future
operations of the Company.

NOTE 3.   DISCONTINUED OPERATIONS AND HELD FOR SALE ASSETS AND LIABILITIES

On August 23,  2005,  Birds Eye Foods  entered into and  completed  transactions
under a Stock Purchase Agreement (the "Sale Agreement") with Congelados Don Jose
S.P.R. de R.L. ("CDJ")  pursuant to which CDJ acquired a manufacturing  facility
in Celaya,  Mexico  utilized  by Birds Eye Foods for the  production  of various
frozen vegetables.  The transactions included the sale of the stock of Birds Eye
de Mexico, S.A. de C.V. ("BEMSA"),  a wholly owned subsidiary of Birds Eye Foods
and BEMSA Holding,  Inc., and all of the equipment of Birds Eye Foods located at
the BEMSA facility in Celaya,  Mexico.  The transactions did not impact products
carrying the Birds Eye brand name or any other brand names of the Company.

As of June 25,  2005,  the  Company  had  committed  to a plan to sell its BEMSA
subsidiary and all of the operating assets located at the Celaya,  Mexico plant.
In  connection  with this  plan,  the  Company  designated  BEMSA and all of the
equipment  located  at the  Celaya,  Mexico  plant as  held-for-sale  assets and
adjusted  the  carrying  value to fair value less the  estimated  costs to sell,
which resulted in an impairment charge of approximately $1.6 million (after-tax)
in the fourth quarter of fiscal 2005. In addition,  the assumed liabilities were
classified  as  liabilities  held  for  sale  as of June  25,  2005.  The  final
accounting  for the sale as of the closing date resulted in an  additional  $0.3
million impairment charge (net of taxes of $0.2 million) in the first quarter of
fiscal 2006 and is included as a component  of  discontinued  operations  in the
Consolidated  Statements of Operations,  Accumulated Earnings, and Comprehensive
Income for the six months  ended  December  24,  2005.

                                        7





<PAGE>

Having met the  criteria  outlined in SFAS No.  144,  certain  idle  property in
Sodus,  Michigan has been  classified as an asset held for sale on the Company's
Consolidated  Balance  Sheet as of December 24, 2005.  The sale of this property
was completed in January 2006. No gain or loss was recognized on the sale.

The major classes  included in the  Consolidated  Balance Sheet as held for sale
assets at estimated fair value less costs to sell and held for sale  liabilities
are as follows:

(Dollars in Thousands)

                                                         December 24,  June 25,
                                                             2005        2005
                                                         ------------  --------
Held for sale assets:
Accounts receivable trade                                $          0  $    379
Accounts receivable, other                                          0         4
Inventories                                                         0       369
Prepaid expenses and other current assets                           0       670
Property, plant and equipment, net                                149     4,034
Other assets                                                        0        41
                                                         ------------  --------
   Total held for sale assets                            $        149  $  5,497
                                                         ============  ========

Held for sale liabilities:
Accounts payable                                         $          0  $   (744)
Income taxes payable                                                0      (308)
Accrued employee compensation                                       0      (716)
Other accrued liabilities                                           0      (246)
                                                         ------------  --------
   Total held for sale liabilities                       $          0  $ (2,014)
                                                         ============  ========

NOTE 4.   INVENTORIES

The major classes of inventories, net of inventory obsolescence reserves of $6.0
million  and  $6.4  million,  as  of  December  24,  2005  and  June  25,  2005,
respectively, are as follows:

(Dollars in Thousands)

                                                         December 24,  June 25,
                                                             2005        2005
                                                         ------------  ---------

Finished goods                                           $    241,948  $ 175,432
Raw materials and supplies                                     18,925     20,855
                                                         ------------  ---------
   Total inventories                                     $    260,873  $ 196,287
                                                         ============  =========

NOTE 5.   ACCOUNTING FOR GOODWILL AND INTANGIBLE ASSETS

Goodwill:  Birds Eye Foods follows SFAS No. 142,  "Goodwill and Other Intangible
Assets", which requires that goodwill not be amortized, but instead be tested at
least  annually for impairment  and expensed  against  earnings when its implied
fair value is less than its carrying amount.

Intangible  Assets:  As  outlined in SFAS No. 142,  certain  intangibles  with a
finite life are  required to continue to be  amortized.  These  intangibles  are
being amortized on a straight-line  basis over approximately 5 to 36 years. SFAS
No. 142 also  requires  that  intangible  assets  with  indefinite  lives not be
amortized, however, are required to be tested annually for impairment.

                                        8





<PAGE>

The following schedule sets forth the major classes of intangible assets held by
the Company:

(Dollars in Thousands)

<TABLE>
<CAPTION>
                                        December 24,               June 25,
                                           2005                      2005
                                 ------------------------   ------------------------
                                   Gross                      Gross
                                 Carrying    Accumulated    Carrying    Accumulated
                                  Amount     Amortization    Amount     Amortization
                                 ---------   ------------   ---------   ------------
<S>                              <C>         <C>            <C>         <C>
Amortized intangible assets:
   Customer relationships        $  36,100   $     (3,971)  $  36,100   $     (3,135)
   License agreement                10,406         (2,531)     10,406         (2,156)
   Other                             2,921         (1,400)      2,921         (1,140)
                                 ---------   ------------   ---------   ------------
      Total                         49,427   $     (7,902)     49,427   $     (6,431)
                                 ---------   ============   ---------   ============

Unamortized intangible assets:
   Trademarks                      179,500                    179,500
                                 ---------                  ---------
      Total                      $ 228,927                  $ 228,927
                                 =========                  =========
</TABLE>

The aggregate  amortization  expense  associated with intangible  assets for the
three months ended December 24, 2005 and December, 25, 2004 was $0.7 million and
$0.8 million,  respectively.  The aggregate amortization expense associated with
intangible  assets for the six months  ended  December 24, 2005 and December 25,
2004 was $1.5 million and $1.3 million, respectively. The aggregate amortization
expense for each of the five succeeding fiscal years is estimated as follows:

(Dollars in Thousands)

                                Aggregate
                                 Annual
Fiscal                        Amortization
 Year                           Expense
------                        ------------
 2007                         $      2,815
 2008                                2,803
 2009                                2,803
 2010                                2,533
 2011                                2,423

NOTE 6.   DEBT

The following is a summary of long-term debt outstanding:

(Dollars in Thousands)
                                                   December 24,   June 25,
                                                       2005         2005
                                                   ------------   ---------

Term Loan Facility                                 $    248,809   $ 250,159
Senior Subordinated Notes                                50,917      51,089
Revolving Credit Facility                                18,800           0
                                                   ------------   ---------
   Total debt                                           318,526     301,248
Less current portion                                     (2,700)     (2,700)
                                                   ------------   ---------
   Total long-term debt                            $    315,826   $ 298,548
                                                   ============   =========

Bank Debt: On August 19, 2002,  Birds Eye Foods and certain of its  subsidiaries
entered into a senior secured credit facility (the "Senior Credit  Facility") in
the  amount of  $470.0  million  with a  syndicate  of banks  and other  lenders
arranged and managed by JPMorgan  Chase Bank, as  administrative  and collateral
agent.  The Senior Credit  Facility is comprised of (i) a $200.0  million senior
secured  revolving credit facility (the "Revolving  Credit Facility") and (ii) a
$270.0  million  senior  secured B term loan (the  "Term  Loan  Facility").  The
Revolving  Credit Facility matures in August 2007 and allows up to $40.0 million
to be available in the form of letters of credit.  As of December 24, 2005,  (i)
there were $18.8  million of cash  borrowings  outstanding  under the  Revolving
Credit Facility, (ii) there were $23.6 million in letters of credit outstanding,
and therefore (iii)  availability under the Revolving Credit Facility was $157.6
million.

                                        9





<PAGE>

The Term Loan Facility requires payments in quarterly installments in the amount
of $675,000 until September 30, 2007. Beginning December 31, 2007, the quarterly
payments are $64.1 million.  The Term Loan Facility  matures in August 2008 upon
which the balance will be due.

As of December 24, 2005, the interest rate under the Revolving  Credit  Facility
was  approximately  6.59  percent,  and the  interest  rate  under the Term Loan
Facility was approximately 6.97 percent.

As of December  24,  2005,  the  Company is in  compliance  with all  covenants,
restrictions, and requirements under the terms of the Senior Credit Facility.

The Company's  obligations  under the Senior Credit  Facility are  guaranteed by
Holdings  Inc.  and  certain of the  Company's  subsidiaries.  See NOTE 9 to the
"Notes to Consolidated Financial Statements".

Senior  Subordinated Notes: Birds Eye Foods has outstanding $50.0 million of its
11 7/8 percent Senior Subordinated Notes (the "Notes"), due 2008. As of December
24,  2005,  the  premium  related  to the  Notes was $0.9  million  and is being
amortized  against  interest  expense over the remaining life of the outstanding
Notes.

As of December  24,  2005,  the  Company is in  compliance  with all  covenants,
restrictions, and requirements under the Notes.

NOTE 7.   INTERIM DISCLOSURES FOR PENSIONS AND OTHER POSTRETIREMENT BENEFITS

Components of Total Periodic Benefit Cost/Pension Benefits
(Dollars in Thousands)

<TABLE>
<CAPTION>
                                                           Pension Benefits
                                           Three Months Ended              Six Months Ended
                                       ---------------------------   ---------------------------
                                       December 24,   December 25,   December 24,   December 25,
                                           2005           2004           2005           2004
                                       ------------   ------------   ------------   ------------
<S>                                    <C>            <C>            <C>            <C>
Service cost                           $      1,046   $      1,113   $      2,365   $      2,227
Interest cost                                 2,085          1,981          4,203          3,962
Expected return on plan assets               (1,874)        (1,793)        (3,747)        (3,586)
Amortization of prior service cost                1              2              3              3
Amortization of actuarial loss                  260            211            532            422
                                       ------------   ------------   ------------   ------------
Net periodic cost - Company plans      $      1,518   $      1,514   $      3,356   $      3,028
Net periodic cost - union plans                 197            122            260            224
Special termination benefits                      0              0          2,487              0
                                       ------------   ------------   ------------   ------------
   Total periodic benefit cost         $      1,715   $      1,636   $      6,103   $      3,252
                                       ============   ============   ============   ============
</TABLE>

The special  termination  benefits reflect the accelerated vesting of retirement
benefits  provided  to  the  Company's  former  Chairman,  President  and  Chief
Executive  Officer  which  is  included  in  restructuring  on the  Consolidated
Statement of Operations,  Accumulated  Earnings,  and Comprehensive  Income. See
NOTE 10 to the  "Notes to  Consolidated  Financial  Statements"  for  additional
disclosure.

The  Company  made a  voluntary  contribution  of $10.9  million  to its  Master
Salaried and Hourly Retirement plans in the first quarter of fiscal 2006.

Components of Total  Periodic  Benefit  Cost/Postretirement  Benefits Other Than
Pensions

(Dollars in Thousands)

<TABLE>
<CAPTION>
                                              Postretirement Benefits Other than Pensions
                                           Three Months Ended              Six Months Ended
                                       ---------------------------   ---------------------------
                                       December 24,   December 25,   December 24,   December 25,
                                           2005           2004           2005           2004
                                       ------------   ------------   ------------   ------------
<S>                                    <C>            <C>            <C>            <C>
Service cost                           $         12   $         11   $         24   $         22
Interest cost                                    46             50             92             99
Amortization of prior service cost               (7)            (8)           (15)           (15)
                                       ------------   ------------   ------------   ------------
   Total periodic benefit cost         $         51   $         53   $        101   $        106
                                       ============   ============   ============   ============
</TABLE>

                                       10





<PAGE>

NOTE 8.   OPERATING SEGMENTS

The Company is organized by product line for management  reporting.  The Company
has three primary  segments in which it operates:  branded frozen,  branded dry,
and non-branded.

The Company's  branded  frozen family of products  includes  traditional  frozen
vegetables as well as value added  products  marketed under  recognizable  brand
names such as Birds Eye, Birds Eye Voila!,  C&W,  Freshlike and McKenzie's.  The
Company's  branded  dry family of  products  includes a wide  variety of product
offerings,  including  fruit  fillings and toppings  (Comstock and  Wilderness),
chili and chili ingredients  (Nalley and Brooks),  salad dressings  (Bernstein's
and Nalley), and snacks (Tim's,  Snyder of Berlin, and Husman).  Birds Eye Foods
also  produces  many  products for the  non-branded  markets which include store
brand, food service and industrial  markets.  The Company's store brand products
include frozen  vegetables,  fruit fillings and toppings,  chili  products,  and
other canned products.  The Company's food  service/industrial  products include
frozen vegetables, salad dressings, mayonnaise, fruit fillings and toppings, and
chili products.

The following table illustrates the Company's operating segment information:

(Dollars in Millions)

<TABLE>
<CAPTION>
                                                 Three Months Ended             Six Months Ended
                                            ---------------------------   ---------------------------
                                            December 24,   December 25,   December 24,   December 25,
                                                2005           2004           2005           2004
                                            ------------   ------------   ------------   ------------
<S>                                         <C>            <C>            <C>            <C>
Net Sales:
   Branded frozen                           $      121.7   $      115.3   $      199.5   $      178.4
   Branded dry                                      71.1           67.6          119.0          113.2
   Non-branded                                      87.4           83.6          158.3          152.2
                                            ------------   ------------   ------------   ------------
Total continuing segments                   $      280.2   $      266.5   $      476.8   $      443.8
                                            ============   ============   ============   ============
Operating income/(loss):
   Branded frozen                           $       20.6   $       20.0   $       27.2   $       24.2
   Branded dry                                      16.5           14.9           23.5           21.8
   Non-branded                                      (4.3)          (2.0)         (10.0)          (7.1)
   Restructuring(1)                                  0.0            0.0           (4.5)           0.0
   Other (expense)/income(2)                        (0.6)           2.2           (0.6)           2.2
                                            ------------   ------------   ------------   ------------
Operating Income                                    32.2           35.1           35.6           41.1
Interest expense                                    (8.5)          (7.3)         (16.3)         (13.7)
                                            ------------   ------------   ------------   ------------
Pretax income from continuing operations    $       23.7   $       27.8   $       19.3   $       27.4
                                            ============   ============   ============   ============
</TABLE>

(1)   Represents a  restructuring  charge which is not  allocated to  individual
      segments.  This item is excluded from the Company's  evaluation of segment
      performance.   See  NOTE  10  to  the  "Notes  to  Consolidated  Financial
      Statements"   for   additional   disclosures   regarding   the   Company's
      restructuring activities.

(2)   Other  (expense)/income  is not  allocated to individual  segments.  These
      items are excluded from the Company's  evaluation of segment  performance.
      See  NOTE 10 to the  "Notes  to  Consolidated  Financial  Statements"  for
      additional disclosures regarding other (expense)/income.

NOTE 9.   GUARANTEES AND INDEMNIFICATIONS

In  certain  instances  when Birds Eye Foods  sells  businesses  or assets,  the
Company  may  retain  certain   liabilities  for  known  exposures  and  provide
indemnification  to the buyer with respect to future claims for certain  unknown
liabilities existing, or arising from events occurring,  prior to the sale date,
including liabilities for taxes, legal matters,  environmental exposures,  labor
contingencies,  product  liability,  and  other  obligations.  The  terms of the
indemnifications vary in duration,  from one to three years for certain types of
indemnities, to terms for tax indemnifications that are generally aligned to the
applicable  statute  of  limitations  for the  jurisdiction  in which the tax is
imposed,  and to terms for certain  liabilities  (i.e.,  warranties of title and
environmental  liabilities) that typically do not expire.  The maximum potential
future  payments  that  the  Company  could  be  required  to make  under  these
indemnifications  are  either  contractually  limited to a  specified  amount or
unlimited.  The maximum  potential  future  payments  that the Company  could be
required to make under these indemnifications are not determinable at this time,
as any future  payments would be dependent on the type and extent of the related
claims, and all relevant defenses, which are not estimable.  Historically, costs
incurred  to  resolve  claims  related to these  indemnifications  have not been
material to the  Company's  financial  position,  results of  operations or cash
flows.

The Company  enters  into  agreements  with  indemnification  provisions  in the
ordinary course of business with its customers, suppliers, service providers and
business partners.  In such instances,  the Company usually  indemnifies,  holds
harmless  and agrees to reimburse  the  indemnified  party for claims,  actions,
liabilities,  losses  and  expenses  in  connection  with any  Birds  Eye  Foods
infringement of third

                                       11





<PAGE>

party  intellectual  property or  proprietary  rights,  or when  applicable,  in
connection  with any personal  injuries or property  damage  resulting  from any
Birds Eye Foods' products sold or services provided.  Additionally,  the Company
may from time to time agree to  indemnify  and hold  harmless  its  providers of
services  from claims,  actions,  liabilities,  losses and expenses  relating to
their services to Birds Eye Foods,  except to the extent  finally  determined to
have  resulted  from the fault of the  provider  of  services  relating  to such
services. The level of conduct constituting fault of the service provider varies
from agreement to agreement and may include conduct which is defined in terms of
negligence,  gross negligence,  willful misconduct,  omissions or other culpable
behavior.  The  terms of these  indemnification  provisions  are  generally  not
limited.  The  maximum  potential  future  payments  that the  Company  could be
required to make under  these  indemnification  provisions  are  unlimited.  The
maximum  potential  future  payments  that the Company could be required to make
under these indemnification provisions are not determinable at this time, as any
future payments would be dependent on the type and extent of the related claims,
and all relevant defenses to the claims, which are not estimable.  Historically,
costs  incurred to resolve claims  related to these  indemnification  provisions
have  not  been  material  to  the  Company's  financial  position,  results  of
operations or cash flows.

The Company has by-laws, policies, and agreements under which it indemnifies its
directors and officers from liability for certain  events or  occurrences  while
the directors or officers are, or were,  serving at Birds Eye Foods'  request in
such  capacities.  Furthermore,  the  Company  is  incorporated  in the state of
Delaware which requires  corporations  to indemnify their officers and directors
under certain  circumstances.  The term of the indemnification period is for the
director's  or  officer's  lifetime.  The  maximum  potential  amount  of future
payments that the Company could be required to make under these  indemnification
provisions is unlimited,  but would be affected by all relevant  defenses to the
claims.

Subsidiary Guarantors: Kennedy Endeavors, Incorporated, Linden Oaks Corporation,
(wholly-owned  subsidiaries of the Company) and Pro-Fac  (Pro-Fac files periodic
reports under the Security Exchange Act of 1934, Commission File Number 0-20539)
have jointly and severally,  fully and unconditionally  guaranteed,  on a senior
subordinated basis, the obligations of the Company with respect to the Company's
11 7/8  percent  Senior  Subordinated  Notes due 2008.  In  addition,  Birds Eye
Holdings,  Inc.,  Kennedy  Endeavors,  Incorporated,  GLK Holdings,  Inc., BEMSA
Holdings,  Inc.,  and Linden Oaks  Corporation  ("Subsidiary  Guarantors")  have
jointly and severally,  fully and unconditionally  guaranteed the obligations of
the Company with respect to the Company's Senior Credit Facility.  The covenants
in the 11 7/8 percent Senior  Subordinated  Notes and the Senior Credit Facility
do  not  restrict  the  ability  of  the  Subsidiary  Guarantors  to  make  cash
distributions to the Company.

Presented below is condensed  consolidating  financial information for (i) Birds
Eye Foods, (ii) the Subsidiary Guarantors, and (iii) non-guarantor subsidiaries.
The condensed consolidating financial information has been presented to show the
nature of assets held, results of operations,  and cash flows of the Company and
its Subsidiary  Guarantors and  non-guarantor  subsidiaries  in accordance  with
Securities and Exchange Commission Financial Reporting Release No. 55.

<TABLE>
<CAPTION>
                                                                 Statement of Operations
                                                            Three Months Ended December 24, 2005
                                            ---------------------------------------------------------------------
                                             Birds Eye    Subsidiary   Non-Guarantor   Eliminating
(Dollars in Thousands)                      Foods, Inc.   Guarantors    Subsidiaries     Entries     Consolidated
                                            -----------   ----------   -------------   -----------   ------------
<S>                                         <C>           <C>          <C>             <C>           <C>
Net sales                                   $   273,731   $    6,459   $           0   $         0   $    280,190
Cost of sales                                  (212,466)      (4,941)              0             0       (217,407)
                                            -----------   ----------   -------------   -----------   ------------
Gross profit                                     61,265        1,518               0             0         62,783
Selling, administrative, and general expense    (29,178)        (783)              0             0        (29,961)
Other (expense)/income                          (10,812)      10,200               0             0           (612)
Income from subsidiaries                          9,413          651               0       (10,064)             0
                                            -----------   ----------   -------------   -----------   ------------
Operating income                                 30,688       11,586               0       (10,064)        32,210
Interest (expense)/income                       (11,583)       1,644           1,466             0         (8,473)
                                            -----------   ----------   -------------   -----------   ------------
Pretax income                                    19,105       13,230           1,466       (10,064)        23,737
Tax provision                                    (4,625)      (4,632)              0             0         (9,257)
                                            -----------   ----------   -------------   -----------   ------------
Net income                                  $    14,480   $    8,598   $       1,466   $   (10,064)  $     14,480
                                            ===========   ==========   =============   ===========   ============
</TABLE>

                                       12





<PAGE>

<TABLE>
<CAPTION>
                                                                             Statement of Operations
                                                                       Six Months Ended December 24, 2005
                                                     ---------------------------------------------------------------------
                                                      Birds Eye    Subsidiary   Non-Guarantor   Eliminating
                                                     Foods, Inc.   Guarantors   Subsidiaries      Entries     Consolidated
                                                     -----------   ----------   -------------   -----------   ------------
<S>                                                  <C>           <C>          <C>             <C>           <C>
(Dollars in Thousands)

Net sales                                            $   463,374   $   13,472   $           0   $         0   $    476,846
Cost of sales                                           (368,905)      (9,821)              0             0       (378,726)
                                                     -----------   ----------   -------------   -----------   ------------
Gross profit                                              94,469        3,651               0             0         98,120
Selling, administrative, and general expense             (55,433)      (1,980)              0             0        (57,413)
Restructuring                                             (4,492)           0               0             0         (4,492)
Other (expense)/income                                   (17,425)      16,813               0             0           (612)
Income from subsidiaries                                  16,549        1,302               0       (17,851)             0
                                                     -----------   ----------   -------------   -----------   ------------
Operating income                                          33,668       19,786               0       (17,851)        35,603
Interest (expense)/income                                (22,415)       3,169           2,932             0        (16,314)
                                                     -----------   ----------   -------------   -----------   ------------
Pretax income from continuing operations                  11,253       22,955           2,932       (17,851)        19,289
Tax provision                                                513       (8,036)              0             0         (7,523)
                                                     -----------   ----------   -------------   -----------   ------------
Income from continuing operations                         11,766       14,919           2,932       (17,851)        11,766
Discontinued operations, net of tax                         (281)        (619)              0           619           (281)
                                                     -----------   ----------   -------------   -----------   ------------
Net income                                           $    11,485   $   14,300   $       2,932   $   (17,232)  $     11,485
                                                     ===========   ==========   =============   ===========   ============
</TABLE>

<TABLE>
<CAPTION>
                                                                                    Balance Sheet
                                                                                December 24, 2005
                                                     ---------------------------------------------------------------------
                                                      Birds Eye    Subsidiary   Non-Guarantor   Eliminating
                                                     Foods, Inc.   Guarantors    Subsidiaries     Entries     Consolidated
                                                     -----------   ----------   -------------   -----------   ------------
<S>                                                  <C>           <C>          <C>             <C>           <C>
(Dollars in Thousands)

Assets
   Cash and cash equivalents                         $     5,520   $      466   $           0   $         0   $      5,986
   Accounts receivable, net                               73,734        4,417             977          (977)        78,151
   Inventories -
      Finished goods                                     241,482          466               0             0        241,948
      Raw materials and supplies                          18,312          613               0             0         18,925
                                                     -----------   ----------   -------------   -----------   ------------
         Total inventories                               259,794        1,079               0             0        260,873
   Held for sale assets                                      149            0               0             0            149
   Other current assets                                   21,817           54               0        (3,526)        18,345
                                                     -----------   ----------   -------------   -----------   ------------
         Total current assets                            361,014        6,016             977        (4,503)       363,504
   Property, plant, and equipment, net                   162,773       21,247               0             0        184,020
   Investment in subsidiaries                            342,142       15,159               0      (357,301)             0
   Goodwill and other intangible assets, net              78,121      188,008               0             0        266,129
   Other assets                                           12,172      101,869          33,165      (134,675)        12,531
                                                     -----------   ----------   -------------   -----------   ------------
         Total assets                                $   956,222   $  332,299   $      34,142   $  (496,479)  $    826,184
                                                     ===========   ==========   =============   ===========   ============

Liabilities and Shareholder's Equity
   Current portion of long-term debt                 $     2,700   $        0   $           0   $         0   $      2,700
   Current portion of Termination Agreement
      with Pro-Fac Cooperative, Inc.                       9,621            0               0             0          9,621
   Accounts payable                                       58,658        1,187               0             0         59,845
   Accrued interest                                        3,229            0               0          (977)         2,252
   Intercompany loans                                     (1,864)       1,864               0             0              0
   Other current liabilities                              74,804        6,089               0        (3,526)        77,367
                                                     -----------   ----------   -------------   -----------   ------------
         Total current liabilities                       147,148        9,140               0        (4,503)       151,785
   Long-term debt                                        348,991            0               0       (33,165)       315,826
   Long-term portion of Termination
      Agreement with Pro-Fac Cooperative, Inc.             3,453            0               0             0          3,453
   Other non-current liabilities                         185,449            0               0      (101,510)        83,939
                                                     -----------   ----------   -------------   -----------   ------------
         Total liabilities                               685,041        9,140               0      (139,178)       555,003
   Shareholder's equity                                  271,181      323,159          34,142      (357,301)       271,181
                                                     -----------   ----------   -------------   -----------   ------------
         Total liabilities and shareholder's equity  $   956,222   $  332,299   $      34,142   $  (496,479)  $    826,184
                                                     ===========   ==========   =============   ===========   ============
</TABLE>

                                       13





<PAGE>

<TABLE>
<CAPTION>
                                                                                 Statement of Cash Flows
                                                                           Six Months Ended December 24, 2005
                                                     ---------------------------------------------------------------------
                                                      Birds Eye    Subsidiary   Non-Guarantor   Eliminating
                                                     Foods, Inc.   Guarantors    Subsidiaries     Entries     Consolidated
                                                     -----------   ----------   -------------   -----------   ------------
<S>                                                  <C>           <C>          <C>             <C>           <C>
(Dollars in Thousands)

Cash Flows From Operating Activities:
   Net income                                        $    11,485   $   14,300   $       2,932   $   (17,232)  $     11,485
   Adjustments to reconcile net income to cash
      (used in)/provided by operating activities -
         Asset impairment charge within
            discontinued operations                            0          454               0             0            454
         Restructuring charge                              4,492            0               0             0          4,492
         Restructuring payments                             (517)           0               0             0           (517)
         Other expense                                       612            0               0             0            612
         Amortization of certain intangible assets         1,097          374               0             0          1,471
         Depreciation                                     10,744        1,007               0             0         11,751
         Gain on derivative instruments                     (281)           0               0             0           (281)
         Amortization of debt issue costs, amendment
            costs, and debt premiums                       4,409            0            (976)            0          3,433
         Gain on sale of assets                              (12)           1               0             0            (11)
         Provision for deferred taxes                      6,527            0               0             0          6,527
         Provision for losses on accounts receivable         177            0               0             0            177
         Equity in earnings of subsidiaries               (3,436)        (439)              0         3,875              0
         Change in working capital                       (75,353)      (3,631)            (12)            0        (78,996)
                                                     -----------   ----------   -------------   -----------   ------------
Net cash (used in)/provided by operating activities      (40,056)      12,066           1,944       (13,357)       (39,403)
                                                     -----------   ----------   -------------   -----------   ------------

Cash Flows From Investing Activities:
   Purchase of property, plant, and equipment             (5,154)        (414)              0             0         (5,568)
   Proceeds from disposals                                   675        2,514               0             0          3,189
   Distributions from BEMSA Holdings, Inc.                 2,740            0               0        (2,740)             0
   Proceeds from investment in CoBank                        199            0               0             0            199
                                                     -----------   ----------   -------------   -----------   ------------
Net cash (used in)/provided by investing activities       (1,540)       2,100               0        (2,740)        (2,180)
                                                     -----------   ----------   -------------   -----------   ------------

Cash Flows From Financing Activities:
   Net proceeds from Revolving Credit Facility            18,800            0               0             0         18,800
   Payments on long-term debt                             (1,350)           0               0             0         (1,350)
   Payments on Termination Agreement with
      Pro-Fac Cooperative, Inc.                           (6,000)           0               0             0         (6,000)
   Payments on capital leases                               (432)           0               0             0           (432)
   Birds Eye Holdings, Inc. investment, net                  549            0               0             0            549
   Distribution to Birds Eye Foods                             0       (2,740)              0         2,740              0
   Dividends paid                                              0      (11,413)         (1,944)       13,357              0
                                                     -----------   ----------   -------------   -----------   ------------
Net cash provided by/(used in) financing activities       11,567      (14,153)         (1,944)       16,097         11,567
                                                     -----------   ----------   -------------   -----------   ------------

Net change in cash and cash equivalents                  (30,029)          13               0             0        (30,016)

Cash and cash equivalents at beginning of period          35,549          453               0             0         36,002
                                                     -----------   ----------   -------------   -----------   ------------
Cash and cash equivalents at end of period           $     5,520   $      466   $           0   $         0   $      5,986
                                                     ===========   ==========   =============   ===========   ============
</TABLE>

                                       14





<PAGE>

<TABLE>
<CAPTION>
                                                                               Statement of Operations
                                                                        Three Months Ended December 25, 2004
                                                     ---------------------------------------------------------------------
                                                      Birds Eye    Subsidiary   Non-Guarantor   Eliminating
                                                     Foods, Inc.   Guarantors    Subsidiaries     Entries     Consolidated
                                                     -----------   ----------   -------------   -----------   ------------
<S>                                                  <C>           <C>          <C>             <C>           <C>
(Dollars in Thousands)

Net sales                                            $   261,718   $    4,755   $           0   $         0   $    266,473
Cost of sales                                           (197,909)      (3,641)              0             0       (201,550)
                                                     -----------   ----------   -------------   -----------   ------------
Gross profit                                              63,809        1,114               0             0         64,923
Selling, administrative, and general expense             (31,325)        (711)              0             0        (32,036)
Other (expense)/income                                    (7,500)       9,699               0             0          2,199
Income from subsidiaries                                   8,570          651               0        (9,221)             0
                                                     -----------   ----------   -------------   -----------   ------------
Operating income                                          33,554       10,753               0        (9,221)        35,086
Interest (expense)/income                                 (9,926)       1,180           1,466             0         (7,280)
                                                     -----------   ----------   -------------   -----------   ------------
Pretax income from continuing operations                  23,628       11,933           1,466        (9,221)        27,806
Tax provision                                             (6,920)      (4,178)              0             0        (11,098)
                                                     -----------   ----------   -------------   -----------   ------------
Income from continuing operations                         16,708        7,755           1,466        (9,221)        16,708
Discontinued operations, net of tax                            0          832               0          (832)             0
                                                     -----------   ----------   -------------   -----------   ------------
Net income                                           $    16,708   $    8,587   $       1,466   $   (10,053)  $     16,708
                                                     ===========   ==========   =============   ===========   ============
</TABLE>

<TABLE>
<CAPTION>
                                                                              Statement of Operations
                                                                         Six Months Ended December 25, 2004
                                                     ---------------------------------------------------------------------
                                                      Birds Eye    Subsidiary   Non-Guarantor   Eliminating
                                                     Foods, Inc.   Guarantors    Subsidiaries     Entries     Consolidated
                                                     -----------   ----------   -------------   -----------   ------------
<S>                                                  <C>           <C>          <C>             <C>           <C>
(Dollars in Thousands)

Net sales                                            $   434,219   $    9,598   $           0   $         0   $    443,817
Cost of sales                                           (337,213)      (7,327)              0             0       (344,540)
                                                     -----------   ----------   -------------   -----------   ------------
Gross profit                                              97,006        2,271               0             0         99,277
Selling, administrative, and general expense             (58,832)      (1,568)              0             0        (60,400)
Other (expense)/income                                   (13,367)      15,566               0             0          2,199
Income from subsidiaries                                  14,521        1,302               0       (15,823)             0
                                                     -----------   ----------   -------------   -----------   ------------
Operating income                                          39,328       17,571               0       (15,823)        41,076
Interest (expense)/income                                (18,835)       2,267           2,932             0        (13,636)
                                                     -----------   ----------   -------------   -----------   ------------
Pretax income from continuing operations                  20,493       19,838           2,932       (15,823)        27,440
Tax provision                                             (4,005)      (6,947)              0             0        (10,952)
                                                     -----------   ----------   -------------   -----------   ------------
Income from continuing operations                         16,488       12,891           2,932       (15,823)        16,488
Discontinued operations, net of tax                            0           12               0           (12)             0
                                                     -----------   ----------   -------------   -----------   ------------
Net income                                           $    16,488   $   12,903   $       2,932   $   (15,835)  $     16,488
                                                     ===========   ==========   =============   ===========   ============
</TABLE>

                                       15





<PAGE>

<TABLE>
<CAPTION>
                                                                                  Balance Sheet
                                                                                  June 25, 2005
                                                      ---------------------------------------------------------------------
                                                       Birds Eye    Subsidiary   Non-Guarantor   Eliminating
                                                      Foods, Inc.   Guarantors    Subsidiaries     Entries     Consolidated
                                                      -----------   ----------   -------------   -----------   ------------
<S>                                                   <C>           <C>          <C>             <C>           <C>
(Dollars in Thousands)

Assets
   Cash and cash equivalents                          $    35,549   $      453   $           0   $         0   $     36,002
   Accounts receivable, net                                60,045        4,174               0             0         64,219
   Inventories -
      Finished goods                                      174,696          736               0             0        175,432
      Raw materials and supplies                           20,304          551               0             0         20,855
                                                      -----------   ----------   -------------   -----------   ------------
         Total inventories                                195,000        1,287               0             0        196,287

   Other current assets                                    30,017        6,131             967        (3,886)        33,229
                                                      -----------   ----------   -------------   -----------   ------------

         Total current assets                             320,611       12,045             967        (3,886)       329,737

   Property, plant and equipment, net                     169,809       21,828               0             0        191,637
   Investment in subsidiaries                             349,201       14,720               0      (363,921)             0
   Goodwill and other intangible assets, net               79,214      188,383               0             0        267,597
   Other assets                                            15,251       98,439          32,188      (130,325)        15,553
                                                      -----------   ----------   -------------   -----------   ------------
         Total assets                                 $   934,086   $  335,415   $      33,155   $  (498,132)  $    804,524
                                                      ===========   ==========   =============   ===========   ============

Liabilities and Shareholder's Equity
   Current portion of long-term debt                  $     2,700   $        0   $           0   $         0   $      2,700
   Current portion of Termination Agreement with
      Pro-Fac Cooperative, Inc.                             9,455            0               0             0          9,455
   Accounts payable                                        77,571        1,026               0             0         78,597
   Accrued interest                                         3,111            0               0          (967)         2,144
   Intercompany loans                                       2,904       (2,904)              0             0              0
   Other current liabilities                               59,296        6,527               0        (2,919)        62,904
                                                      -----------   ----------   -------------   -----------   ------------
         Total current liabilities                        155,037        4,649               0        (3,886)       155,800
   Long-term debt                                         330,736            0               0       (32,188)       298,548
   Long-term portion of Termination
      Agreement with Pro-Fac Cooperative, Inc.              8,836            0               0             0          8,836
   Other non-current liabilities                          180,091            0               0       (98,137)        81,954
                                                      -----------   ----------   -------------   -----------   ------------

         Total liabilities                                674,700        4,649               0      (134,211)       545,138

   Shareholder's equity                                   259,386      330,766          33,155      (363,921)       259,386
                                                      -----------   ----------   -------------   -----------   ------------

         Total liabilities and shareholder's equity   $   934,086   $  335,415   $      33,155   $  (498,132)  $    804,524
                                                      ===========   ==========   =============   ===========   ============
</TABLE>

                                       16





<PAGE>

<TABLE>
<CAPTION>
                                                                                     Statement of Cash Flows
                                                                                Six Months Ended December 25, 2004
                                                              ---------------------------------------------------------------------
                                                               Birds Eye    Subsidiary   Non-Guarantor   Eliminating
                                                              Foods, Inc.   Guarantors   Subsidiaries      Entries     Consolidated
                                                              -----------   ----------   -------------   -----------   ------------
<S>                                                           <C>           <C>          <C>             <C>           <C>
(Dollars in Thousands)

Cash Flows From Operating Activities:
   Net income/(loss)                                          $    16,488   $   12,903   $       2,932   $   (15,835)  $     16,488
   Adjustments to reconcile net income to cash
      (used in)/provided by operating activities -
         Depreciation                                              10,238        1,061               0             0         11,299
         Gain on derivative instruments                              (608)           0               0             0           (608)
         Other income                                              (2,199)           0               0             0         (2,199)
         Amortization of certain intangible assets                    896          375               0             0          1,271
         Amortization of debt issue costs, amendment costs,
            and debt premiums                                       4,536            0            (976)            0          3,560
         Gain on sale of assets                                       (76)          (3)              0             0            (79)
         Transitional Services Agreement with
            Pro-Fac Cooperative, Inc.                                 (70)           0               0             0            (70)
         Provision for deferred taxes                                 855            0               0             0            855
         Equity in earnings of subsidiaries                        (5,088)        (439)              0         5,527              0
         Change in working capital                                (45,582)      (5,071)            (12)            1        (50,664)
                                                              -----------   ----------   -------------   -----------   ------------
Net cash (used in)/provided by operating activities               (20,610)       8,826           1,944       (10,307)       (20,147)
                                                              -----------   ----------   -------------   -----------   ------------

Cash Flows From Investing Activities:
   Purchase of property, plant, and equipment                      (9,735)        (143)              0             0         (9,878)
   Proceeds from disposals                                            147            7               0             0            154
   Acquisition of California & Washington Company                 (73,455)           0               0             0        (73,455)
   Proceeds from investment in CoBank                                 918            0               0             0            918
   Proceeds from note receivable to Pro-Fac
      Cooperative, Inc., net                                        1,000            0               0             0          1,000
                                                              -----------   ----------   -------------   -----------   ------------
Net cash used in investing activities                             (81,125)        (136)              0             0        (81,261)
                                                              -----------   ----------   -------------   -----------   ------------

Cash Flows From Financing Activities:
   Net proceeds from Revolving Credit Facility                     40,300            0               0             0         40,300
   Payments on long-term debt                                      (1,350)           0               0             0         (1,350)
   Payments on Termination Agreement with
      Pro-Fac Cooperative, Inc.                                    (6,000)           0               0             0         (6,000)
   Payments on capital leases                                        (436)           0               0             0           (436)
   Birds Eye Holdings, Inc. investment, net                            37            0               0             0             37
   Dividends paid                                                       0       (8,363)         (1,944)       10,307              0
                                                              -----------   ----------   -------------   -----------   ------------
Net cash provided by/(used in) financing activities                32,551       (8,363)         (1,944)       10,307         32,551
                                                              -----------   ----------   -------------   -----------   ------------

Net change in cash and cash equivalents                           (69,184)         327               0             0        (68,857)

Cash and cash equivalents at beginning of period                   72,701          186               0             0         72,887
                                                              -----------   ----------   -------------   -----------   ------------
Cash and cash equivalents at end of period                    $     3,517   $      513    $          0   $         0   $      4,030
                                                              ===========   ==========   =============   ===========   ============
</TABLE>

NOTE 10.  OTHER MATTERS

Restructuring:  In the first  quarter of fiscal 2006,  the Company  recognized a
charge of $4.5 million for  payments to be provided and incurred in  conjunction
with the  departure  of the  Company's  former  Chairman,  President  and  Chief
Executive Officer.

Other  (Expense)/Income:  During the second  quarter of fiscal 2006, the Company
had committed to a plan to donate certain idle property in Sodus,  Michigan.  In
conjunction with this  transaction,  the Company recorded  contribution  expense
based on the  fair  value of the  property  of  approximately  $0.6  million  in
continuing operations in the Consolidated Statements of Operations,  Accumulated
Earnings,  and Comprehensive Income for the quarter ended December 24, 2005. The
donation was completed in January 2006.

During the second  quarter of fiscal 2005,  management  renegotiated  one of its
third-party warehousing leases. This resulted in

                                       17





<PAGE>

recognition  of a $2.2  million  pretax  benefit  due to the  elimination  of an
unfavorable lease commitment that was recorded in purchase  accounting in fiscal
2003.

Legal Matters: Birds Eye Foods is a party to various legal proceedings from time
to time in the normal course of its business. In the opinion of management,  any
liability that the Company might incur upon the resolution of these  proceedings
will not, in the  aggregate,  have a material  adverse  effect on the  Company's
business,  financial  condition,  or results  of  operations.  Further,  no such
proceedings are known to be contemplated by any  governmental  authorities.  The
Company maintains general liability  insurance  coverage in amounts deemed to be
adequate by management.

                                       18





<PAGE>

               CAUTIONARY STATEMENT ON FORWARD-LOOKING STATEMENTS

From  time to time,  Birds Eye  Foods or  persons  acting on behalf of Birds Eye
Foods may make oral and written statements that may constitute  "forward-looking
statements" as defined in the Private  Securities  Litigation Reform Act of 1995
(the "PSLRA") or by the Securities and Exchange Commission ("SEC") in its rules,
regulations,  and releases.  The Company  desires to take advantage of the "safe
harbor" provisions in the PSLRA for forward-looking statements made from time to
time, including,  but not limited to, the forward-looking  information contained
in the "Management's  Discussion and Analysis of Financial Condition and Results
of Operations" section of this Form 10-Q Equivalent and other statements made in
this Form 10-Q Equivalent and in other filings with the SEC.

The Company cautions readers that any such forward-looking statements made by or
on behalf of the  Company are based on  management's  current  expectations  and
beliefs,  all of which could be affected by the  uncertainties  and risk factors
described below. The Company's actual results could differ materially from those
expressed or implied in the  forward-looking  statements.  The risk factors that
could impact the Company include:

o     strong competition in the food industry, including competitive pricing;

o     changes in consumer demand;

o     consumer reaction to pricing actions and changes in promotion levels;

o     the effectiveness of marketing initiatives and shifts in market demand;

o     the impact of weather on the volume and quality of raw product;

o     fluctuations  in the cost of supply chain elements,  including  energy and
      energy related costs;

o     the  inherent  risks  in  the  marketplace  associated  with  new  product
      introductions,   including   uncertainties   about   trade  and   consumer
      acceptance;

o     the  continuation  of the  Company's  success  in  integrating  operations
      (including the realization of anticipated  synergies in operations and the
      timing of any such  synergies),  and the  availability  of acquisition and
      alliance opportunities;

o     the Company's ability to achieve gains in productivity and improvements in
      capacity utilization;

o     the Company's ability to service debt; and

o     economic  conditions,  including  changes in inflation  rates and interest
      rates.

                                       19





<PAGE>

ITEM 2.   MANAGEMENT'S  DISCUSSION AND ANALYSIS OF FINANCIAL  CONDITION AND
          RESULTS OF OPERATIONS.

The  purpose  of this  discussion  is to outline  the  significant  reasons  for
material  changes  in the Birds Eye Foods  financial  condition  and  results of
operations in the second quarter and first six months of fiscal 2006 as compared
to the second  quarter and first six months of fiscal 2005.  This section should
be read in conjunction with Part I, Item 1 of this report.

Birds Eye Foods has three primary segments  including:  branded frozen,  branded
dry, and non-branded. The majority of each of the segments' net sales are within
the United  States.  All of the Company's  operating  facilities  are within the
United States.

The Company's  branded  frozen family of products  includes  traditional  frozen
vegetables as well as value added  products  marketed under  recognizable  brand
names such as Birds Eye, Birds Eye Voila!,  C&W,  Freshlike and McKenzie's.  The
Company's  branded  dry family of  products  includes a wide  variety of product
offerings,  including  fruit  fillings and toppings  (Comstock and  Wilderness),
chili and chili ingredients  (Nalley and Brooks),  salad dressings  (Bernstein's
and Nalley),  and snacks (Tim's,  Snyder of Berlin and Husman).  Birds Eye Foods
also  produces  many  products for the  non-branded  markets which include store
brand, food service and industrial  markets.  The Company's store brand products
include frozen  vegetables,  fruit fillings and toppings,  chili  products,  and
other canned products.  The Company's food  service/industrial  products include
frozen vegetables, salad dressings, mayonnaise, fruit fillings and toppings, and
chili products.

The  following  tables  illustrate  the results of operations by segment for the
three and six months ended December 24, 2005 and December 25, 2004:

Net Sales
(Dollars in Millions)

<TABLE>
<CAPTION>
                                    Three Months Ended               Six Months Ended
                               -----------------------------   -----------------------------
                               December 24,    December 25,    December 24,    December 25,
                                   2005            2004            2005            2004
                               -------------   -------------   -------------   -------------
                                       % of            % of            % of            % of
                                 $     Total     $     Total     $     Total     $     Total
                               -----   -----   -----   -----   -----   -----   -----   -----
<S>                            <C>     <C>     <C>     <C>     <C>     <C>     <C>     <C>
Branded frozen                 121.7    43.4   115.3    43.2   199.5    41.8   178.4    40.2
Branded dry                     71.1    25.4    67.6    25.4   119.0    25.0   113.2    25.5
Non-branded                     87.4    31.2    83.6    31.4   158.3    33.2   152.2    34.3
                               -----   -----   -----   -----   -----   -----   -----   -----
   Total                       280.2   100.0   266.5   100.0   476.8   100.0   443.8   100.0
                               =====   =====   =====   =====   =====   =====   =====   =====
</TABLE>

Operating Income
(Dollars in Millions)

<TABLE>
<CAPTION>
                                    Three Months Ended             Six Months Ended
                               ---------------------------   ---------------------------
                               December 24,   December 25,   December 24,   December 25,
                                  2005           2004            2005           2004
                               ------------   ------------   ------------   ------------
<S>                            <C>            <C>            <C>            <C>
Branded frozen                 $       20.6   $       20.0   $       27.2   $       24.2
Branded dry                            16.5           14.9           23.5           21.8
Non-branded                            (4.3)          (2.0)         (10.0)          (7.1)
                               ------------   ------------   ------------   ------------
   Subtotal                            32.8           32.9           40.7           38.9
Restructuring(1)                        0.0            0.0           (4.5)           0.0
Other (expense)/income(2)              (0.6)           2.2           (0.6)           2.2
                               ------------   ------------   ------------   ------------
      Total operating income   $       32.2   $       35.1   $       35.6   $       41.1
                               ============   ============   ============   ============
</TABLE>

(1)  Represents a  restructuring  charge which is not  allocated to  individual
      segments.  This item is excluded from the Company's  evaluation of segment
      performance.  See  NOTE 10 to the  "Notes  to the  Consolidated  Financial
      Statements"   for   additional   disclosures   regarding   the   Company's
      restructuring activities.

(2)   Other  (expense)/income  is not  allocated to individual  segments.  These
      items are excluded from the Company's  evaluation of segment  performance.
      See  NOTE 10 to the  "Notes  to  Consolidated  Financial  Statements"  for
      additional disclosures regarding other (expense)/income.

                                       20





<PAGE>

EBITDA(1)

The following table sets forth continuing segment EBITDA (defined as income from
continuing operations plus interest,  taxes,  depreciation and amortization) for
the three and six months ended  December 24, 2005 and December 25, 2004.  EBITDA
is an  additional  measure  used  by  the  Company  to  evaluate  the  operating
performance  of its  segments,  and is a  primary  measure  used  internally  by
management  to  manage  the  business.  EBITDA is also a  primary  measure  used
externally  by  the  Company's   investors  and  lenders  to  ensure  consistent
comparability of operating  results.  EBITDA should,  however,  be considered in
addition to, and not as a substitute  for or superior to operating  income,  net
income,  cash flows from operating  activities,  and other measures of financial
performance prepared in accordance with accounting principles generally accepted
in the  United  States  ("GAAP").  As  EBITDA is not a  measure  of  performance
calculated  in  accordance  with GAAP,  this  measure may not be  comparable  to
similarly titled measures employed by other companies.

(Dollars in Millions)

<TABLE>
<CAPTION>
                                                      Three Months Ended              Six Months Ended
                                                -----------------------------   ------------------------------

                                                December 24,    December 25,    December 24,    December 25,
                                                    2005            2004             2005            2004
                                                -------------   -------------   -------------   --------------
                                                         % of           % of             % of            % of
                                                  $     Total     $     Total     $     Total     $      Total
                                                -----   -----   -----   -----   -----   -----   ------   -----
<S>                                             <C>     <C>     <C>     <C>     <C>     <C>     <C>      <C>
Branded frozen                                  $23.4    58.6   $22.7    57.0   $32.1    59.6   $ 28.6    55.5
Branded dry                                      17.6    44.1    16.1    40.5    25.5    47.3     23.9    46.4
Non-branded                                      (1.1)   (2.7)    1.0     2.5    (3.7)   (6.9)    (1.0)   (1.9)
                                                -----   -----   -----   -----   -----   -----   ------   -----
   Subtotal                                      39.9   100.0    39.8   100.0    53.9   100.0     51.5   100.0
Restructuring(2)                                  0.0             0.0            (4.5)             0.0
Other (expense)/income(3)                        (0.6)            2.2            (0.6)             2.2
                                                -----           -----           -----           ------
   Total EBITDA                                 $39.3           $42.0           $48.8           $ 53.7
                                                =====           =====           =====           ======
Reconciliation of Total EBITDA to net income:
Depreciation and amortization                    (7.0)           (6.9)          (13.2)           (12.6)
Interest expense                                 (8.5)           (7.3)          (16.3)           (13.7)
Tax provision                                    (9.3)          (11.1)           (7.5)           (10.9)
Discontinued operations, net of tax               0.0             0.0            (0.3)             0.0
                                                -----           -----           -----           ------
Net income                                      $14.5           $16.7           $11.5           $ 16.5
                                                =====           =====           =====           ======
</TABLE>

(1)   Earnings before interest, taxes, depreciation, and amortization ("EBITDA")
      is defined as income from  continuing  operations  plus  interest,  taxes,
      depreciation, and amortization.

(2)   Represents a  restructuring  charge which is not  allocated to  individual
      segments.  This item is excluded from the Company's  evaluation of segment
      performance.  See  NOTE 10 to the  "Notes  to the  Consolidated  Financial
      Statements"   for   additional   disclosures   regarding   the   Company's
      restructuring activity.

(3)   Other  (expense)/income  is not  allocated to individual  segments.  These
      items are excluded from the Company's  evaluation of segment  performance.
      See  NOTE 10 to the  "Notes  to  Consolidated  Financial  Statements"  for
      additional disclosures regarding other (expense)/income.

      CHANGES FROM SECOND QUARTER FISCAL 2005 TO SECOND QUARTER FISCAL 2006

Net Sales:  Net sales for the second quarter of fiscal 2006 were $280.2 million,
an increase of $13.7 million, or 5.1 percent, as compared to net sales of $266.5
million  in the  second  quarter of fiscal  2005.  During the second  quarter of
fiscal 2006,  the Company  experienced  revenue  growth in all of its  operating
segments. New product entries,  expansion in distribution and successful pricing
strategies  all  contributed  to the  improvements  in net sales.  The  "Segment
Review" below outlines further details.

Gross Profit:  Gross profit in the fiscal 2006 period decreased,  however,  $2.1
million to $62.8  million  as  compared  to $64.9  million  for the fiscal  2005
period.  Gross profit margin was reduced from 24.4 percent to 22.4 percent.  The
decrease in gross profit margin is due to continued and significant increases in
product costs resulting from energy, fuel and employee benefit related expenses.
To offset these increasing costs and restore margins,  the Company will continue
to focus on cost-savings in its production and administrative areas.

Selling,  Administrative  and  General  Expenses:  Selling,  administrative  and
general  expenses  in the fiscal  2006 period  decreased  $2.0  million to $30.0
million,  as compared to $32.0 million in the fiscal 2005 period or 6.3 percent.
During this period,  the Company has benefited from  reductions in overhead as a
result of  restructuring  activities  initiated in the fourth  quarter of fiscal
2005. In addition,  selling,  administrative and general expenses were favorably
impacted by the timing of marketing initiatives for new products.

                                       21





<PAGE>

Other  (Expense)/Income:  During the second  quarter of fiscal 2006, the Company
had committed to a plan to donate certain idle property in Sodus,  Michigan.  In
conjunction with this  transaction,  the Company recorded  contribution  expense
based on the  fair  value of the  property  of  approximately  $0.6  million  in
continuing operations in the Consolidated Statements of Operations,  Accumulated
Earnings,  and Comprehensive Income for the quarter ended December 24, 2005. The
donation was completed in January 2006.

During the second  quarter of fiscal 2005,  management  renegotiated  one of its
third-party  warehousing  leases. This resulted in recognition of a $2.2 million
pretax benefit due to the  elimination of an unfavorable  lease  commitment that
was recorded in purchase accounting in fiscal 2003.

Operating Income: Operating income for the fiscal 2006 period was $32.2 million,
a decrease  of $2.9  million as  compared  to $35.1  million in the fiscal  2005
period.  The decline is  attributable  to those  factors  discussed  above.  The
branded frozen and branded dry segments increased $0.6 million and $1.6 million,
respectively  and the  non-branded  segment  declined $2.3 million.  Significant
segment variances are highlighted below in the "Segment Review".

Interest  Expense:  Interest expense for the fiscal 2006 period was $8.5 million
compared  to $7.3  million in the  fiscal  2005  period.  Interest  expense  was
unfavorably  impacted by higher  general  interest rates offset by lower average
borrowing on the Company's revolving credit facility.

Tax  Provision:  The provision for income taxes in the second  quarter of fiscal
2006 was $9.3 million  compared to a provision for income taxes of $11.1 million
in the  fiscal  2005  period.  The  variance  is a result of a  decrease  in the
Company's  pretax  earnings.  The Company has not  experienced  any  significant
changes in its consolidated effective tax rate.

Net Income:  Net income for the fiscal 2006 period was $14.5 million compared to
net income of $16.7  million in the fiscal  2005  period.  This  variance is the
result of the factors outlined above.

                                 Segment Review

A detailed  accounting of the  significant  reasons for changes in net sales and
operating income by segment is outlined below.

Branded Frozen:  Branded frozen net sales were $121.7 million in the fiscal 2006
period,  an increase of $6.4  million or 5.6 percent as compared to net sales of
$115.3 million for the fiscal 2005 period. New product  introductions within the
value-added  arena,  including  steamed and sauced vegetables lead the new sales
growth.  In  addition,  net  sales of the  Birds Eye  Voila!  product  line were
positively  impacted by the continued  product  innovation  and the execution of
revised pricing strategies.

The Company  tracks retail sales in many of the  categories in which it competes
using  data from  Information  Resources,  Inc.  ("IRI").  IRI data is  limited,
however,  as IRI does not capture  sales at several of the  Company's  customers
including  Wal-Mart,  Costco, and others. IRI also does not track non-branded or
store brand  retail  sales by the  manufacturer.  According  to IRI,  the frozen
vegetable  category on a unit basis  declined 2.1 percent for the 12-week period
ending  January 1, 2006.  The Company's  branded market share on a unit basis at
January 1, 2006 was 22.4  percent  compared to 20.9  percent at January 2, 2005.
The bagged meal category for the 12-week period ending January 1, 2006 increased
1.8  percent on a unit  basis.  Market  share on a unit basis for the  Company's
Birds Eye Voila!  skillet meal product  offering for the 12-week  period  ending
January 1, 2006 was 17.0 percent compared to 18.0 percent for the 12-week period
ending  January 2, 2005.  The  inclusion  of new  entries  into the bagged  meal
category have resulted in negative comparisons on a unit share basis.

Branded frozen operating income was $20.6 million in the fiscal 2006 period,  an
increase of $0.6 million as compared to operating income of $20.0 million in the
fiscal 2005 period.  While the branded frozen segment was positively impacted by
the revenue growth  highlighted  above,  the Company has continued to experience
production  cost  increases  consistent  with that felt  throughout the industry
including energy, fuel and employee benefit related expenses.

Branded  Dry:  Branded  dry net sales were  $71.1  million  for the fiscal  2006
period,  an increase of $3.5  million or 5.2 percent as compared to net sales of
$67.6  million  for  the  fiscal  2005  period.   This  increase  was  primarily
attributable  to the continued  expansion of the  Company's  snack food business
through its Tim's Cascade Style Potato Chip product line.

Operating  income for the branded  dry segment was $16.5  million for the fiscal
2006  period,  an increase of $1.6  million or 10.7 percent as compared to $14.9
million for the fiscal 2005 period. Operating income directly benefited from the
increase  in net sales and  efforts  to  maximize  the  benefit  of  promotional
spending.

Non-branded:  Non-branded  net sales were  $87.4  million  for the  fiscal  2006
period,  an increase of $3.8 million or 4.5 percent as compared to $83.6 million
in the fiscal  2005  period.  The growth in revenue was  attributable  to volume
increases. Non-branded operating results, however, showed a loss of $4.3 million
for the fiscal 2006 period,  a $2.3 million  decline as compared to an operating
loss of $2.0 million for

                                       22





<PAGE>

the fiscal 2005 period.  The decline in operating  income is attributable to the
increase  in product  costs  consistent  with that  experienced  throughout  the
Company's other operating segments.

As highlighted above, IRI data does not track the Company's non-branded or store
brand retail sales.  Including  management's  estimate of the Company's share of
the store brand market,  the Company believes its overall market share on a unit
basis in the frozen vegetable  category for the 12-week period ending January 1,
2006 was 33.8  percent  compared to 32.4 percent for the 12-week  period  ending
January 2, 2005.

    CHANGES FROM FIRST SIX MONTHS FISCAL 2005 TO FIRST SIX MONTHS FISCAL 2006

Net Sales: Net sales for the fiscal 2006 period were $476.8 million, an increase
of $33.0 million,  or 7.4 percent, as compared to net sales of $443.8 million in
the fiscal 2005 period.  Improvements  in the branded  frozen  segment  resulted
from: (a) the  acquisition of the California and Washington  Company  ("C&W") on
September 23, 2004; (b) new product  introductions in the value-added arena; and
(c) growth within the Birds Eye Voila!  product line. The Company's  branded dry
and  non-branded  segments also showed  improvements in net sales as a result of
increased volume. The "Segment Review" below outlines further details.

Gross Profit:  Gross profit in the fiscal 2006 period,  however,  decreased $1.2
million to $98.1  million  as  compared  to $99.3  million  for the fiscal  2005
period. Gross profit margin was reduced from 22.4 percent to 20.6 percent. Gross
profit margin  continues to be negatively  impacted by significant  inflationary
pressures  affecting product costs including  energy,  fuel and employee benefit
related  expenses.  To offset these increasing  costs and restore  margins,  the
Company will continue to focus on cost-saving  initiatives in its production and
administrative areas.

Selling,  Administrative  and  General  Expenses:  Selling,  administrative  and
general  expenses  in the fiscal  2006 period  decreased  $3.0  million to $57.4
million,  as compared to $60.4 million in the fiscal 2005 period.  During fiscal
2006,  the  Company has  benefited  from  reductions  in overhead as a result of
restructuring  activities  initiated in the fourth  quarter of fiscal  2005.  In
addition,  selling,  administrative and general expenses were favorably impacted
by the timing of marketing initiatives.

Restructuring:  In the first  quarter of fiscal 2006,  the Company  recognized a
charge of $4.5 million for  payments to be provided and incurred in  conjunction
with the  departure  of the  Company's  former  Chairman,  President  and  Chief
Executive Officer.

Other  (Expense)/Income:  During the second  quarter of fiscal 2006, the Company
had committed to a plan to donate certain idle property in Sodus,  Michigan.  In
conjunction with this  transaction,  the Company recorded  contribution  expense
based on the  fair  value of the  property  of  approximately  $0.6  million  in
continuing operations in the Consolidated Statements of Operations,  Accumulated
Earnings,  and Comprehensive Income for the quarter ended December 24, 2005. The
donation was completed in January 2006.

During the second  quarter of fiscal 2005,  management  renegotiated  one of its
third-party  warehousing  leases. This resulted in recognition of a $2.2 million
pretax benefit due to the  elimination of an unfavorable  lease  commitment that
was recorded in purchase accounting in fiscal 2003.

Operating Income: Operating income for the fiscal 2006 period was $35.6 million,
a decrease  of $5.5  million as  compared  to $41.1  million in the fiscal  2005
period.  The decline is  attributable  to those  factors  discussed  above.  The
branded frozen and branded dry segments  increased $3.0 million and $1.7 million
respectively  and the  non-branded  segment  declined $2.9 million.  Significant
segment variances are highlighted below in the "Segment Review".

Interest Expense:  Interest expense for the fiscal 2006 period was $16.3 million
compared  to $13.6  million in the fiscal  2005  period.  Interest  expense  was
unfavorably impacted by higher general interest rates.

Tax  Provision:  The  provision  for income taxes for the fiscal 2006 period was
$7.5 million  compared to a provision  for income taxes of $10.9  million in the
fiscal 2005 period.  The  decrease was a result of a reduction in the  Company's
pre-tax earnings. The Company has not experienced any significant changes in its
consolidated effective tax rate.

Discontinued Operations, net of tax: On August 23, 2005, Birds Eye Foods entered
into and completed  transactions  under a Stock  Purchase  Agreement  (the "Sale
Agreement")  with Congelados Don Jose S.P.R. de R.L.  ("CDJ")  pursuant to which
CDJ acquired a  manufacturing  facility in Celaya,  Mexico utilized by Birds Eye
Foods for the production of various frozen vegetables. The transactions included
the sale of the stock of Birds Eye de Mexico, S.A. de C.V.  ("BEMSA"),  a wholly
owned  subsidiary  of Birds Eye Foods and BEMSA  Holding,  Inc.,  and all of the
equipment of Birds Eye Foods located at the BEMSA facility in Celaya, Mexico. In
the fourth quarter of fiscal 2005, the Company  designated  BEMSA and all of the
equipment  located  at the  Celaya,  Mexico  plant as  held-for-sale  assets and
adjusted the carrying value to fair value less the estimated  costs to sell, and
recorded an impairment charge of $1.6 million (after-tax).  The final accounting
for the sale as of the closing date resulted in an additional  impairment charge
of $0.3 million (after-tax) in the first quarter of fiscal 2006.

                                       23





<PAGE>

Net Income:  Net income for the fiscal 2006 period was $11.5 million compared to
net income of $16.5  million in the fiscal  2005  period.  This  variance is the
result of the factors outlined above.

                                 Segment Review

A detailed  accounting of the  significant  reasons for changes in net sales and
operating income by segment is outlined below.

Branded Frozen:  Branded frozen net sales were $199.5 million in the fiscal 2006
period, an increase of $21.1 million or 11.8 percent as compared to net sales of
$178.4 million for the fiscal 2005 period.  Operating  activity  associated with
the  Company's  acquisition  of C&W benefited  results  along with  improvements
within the  Company's  Birds Eye Voila!  product  line and the  introduction  of
several new products within the value-added arena.

The Company  tracks retail sales in many of the  categories in which it competes
using  data from  Information  Resources,  Inc.  ("IRI").  IRI data is  limited,
however,  as IRI does not capture  sales at several of the  Company's  customers
including  Wal-Mart,  Costco, and others. IRI also does not track non-branded or
store brand  retail  sales by the  manufacturer.  According  to IRI,  the frozen
vegetable  category on a unit basis  declined 2.6 percent for the 26-week period
ending  January 1, 2006. The Company's  branded market share  (including C&W for
all periods) on a unit basis for the 26-week  period ending  January 1, 2006 was
20.4 percent  compared to 20.1 percent for the 26-week  period ending January 2,
2005.  The bagged meal category for the 26-week  period  ending  January 1, 2006
increased  4.0  percent on a unit  basis.  Market  share on a unit basis for the
Company's Birds Eye Voila!  skillet meal product offering for the 26-week period
ending January 1, 2006 was 17.2 percent compared to 19.0 percent for the 26-week
period ending January 2, 2005. The inclusion of new entries into the bagged meal
category have resulted in negative comparisons on a unit share basis.

Branded frozen operating income was $27.2 million in the fiscal 2006 period,  an
increase of $3.0 million as compared to $24.2 million in the fiscal 2005 period.
While the branded  frozen segment was  positively  impacted by operating  income
related to the C&W acquisition and the net sales improvement  highlighted above,
the Company has continued to experience  product cost increases  consistent with
that felt throughout the industry  including  energy,  fuel and employee benefit
related expenses.

Branded  Dry:  Branded  dry net sales were  $119.0  million  for the fiscal 2006
period,  an increase of $5.8  million or 5.1 percent as compared to net sales of
$113.2  million  for  the  fiscal  2005  period.  This  increase  was  primarily
attributable  to the continued  expansion of the  Company's  snack food business
through its Tim's Cascade Style Potato Chip product line.

Operating  income for the branded  dry segment was $23.5  million for the fiscal
2006 period, an increase of $1.7 million or 7.8 percent as compared to operating
income of $21.8 million for the fiscal 2005 period.  Operating  income benefited
from  the  increase  in net  sales  and  efforts  to  maximize  the  benefit  of
promotional spending.

Non-branded:  Non-branded  net sales were  $158.3  million  for the fiscal  2006
period, an increase of $6.1 million or 4.0 percent as compared to $152.2 million
in the fiscal  2005  period.  The growth in revenue was  attributable  to volume
increases.  Non-branded  operating  results,  however,  showed  a loss of  $10.0
million for the fiscal 2006  period,  a $2.9  million  decline as compared to an
operating  loss of $7.1  million  for the fiscal  2005  period.  The  decline in
operating income is attributable to the increase in product cost consistent with
that experienced in the Company's other operating segments.

As highlighted above, IRI data does not track the Company's non-branded or store
brand retail sales.  Including  management's  estimate of the Company's share of
the store brand market,  the Company believes its overall market share on a unit
basis in the frozen vegetable  category  (including C&W for all periods) for the
26-week period ending January 1, 2006 was 32.3 percent  compared to 31.9 percent
for the 26-week period ending January 2, 2005.

                         LIQUIDITY AND CAPITAL RESOURCES

The  following  discussion  highlights  the  major  variances  in the  Unaudited
Consolidated  Statement of Cash Flows for the six months ended December 24, 2005
compared to the six months ended December 25, 2004.

Net cash used in  operating  activities  for the  fiscal  2006  period was $39.4
million as compared to net cash used in operating  activities  of $20.1  million
for the fiscal  2005  period,  representing  an  increase  in cash used of $19.3
million.  The increase in cash used was  primarily  attributable  to a voluntary
contribution  of $10.9  million  made by the Company to its Master  Salaried and
Hourly  Retirement  plans in the first quarter of fiscal 2006. See NOTE 7 to the
"Notes  to  Consolidated   Financial  Statements"  for  additional   disclosures
regarding pension  benefits.  The increase in net cash used was also impacted by
the timing of the  liquidation  of  outstanding  accounts  payable  and  accrued
liability balances.

Net cash used in  investing  activities  for the  fiscal  2006  period  was $2.2
million,  as compared to net cash used in investing  activities of $81.3 million
for the fiscal 2005 period, representing a change of $79.1 million. On September
23, 2004, the Company completed the acquisition of

                                       24





<PAGE>

C&W, which accounted for the majority of the variance in cash used for investing
activities.  The  acquisition of C&W was financed by borrowings on the Company's
Revolving   Credit  Facility  defined  below.  See  NOTE  2  to  "the  Notes  to
Consolidated  Financial  Statements"  for  additional  disclosure  regarding the
acquisition of C&W. Capital  expenditures  were $5.6 million for the 2006 period
compared to $9.9  million in the prior year  period.  The  purchase of property,
plant and  equipment was for general  operating  purposes in both periods and is
considered adequate to maintain its facility in proper working order.

Net cash provided by financing  activities  for the fiscal 2006 period was $11.6
million,  as compared  to net cash  provided by  financing  activities  of $32.6
million in the fiscal 2005 period,  representing a change of $21.0 million. This
change was primarily  driven by net proceeds from the Revolving  Credit Facility
to finance  the  acquisition  of C&W during  the first  quarter of fiscal  2005,
offset by lower working capital  borrowings on the Revolving  Credit Facility in
the fiscal  2005  period due to a higher  beginning  of year cash  balance.  The
Company's  borrowings on its Revolving  Credit  Facility  during the fiscal 2006
period were used in the ordinary course of business.

Senior  Credit  Facility:  In connection  with the August 19, 2002  Transaction,
Birds Eye Foods and certain of its  subsidiaries  entered into a senior  secured
credit  facility (the "Senior Credit  Facility") in the amount of $470.0 million
with a syndicate  of banks and other  lenders  arranged  and managed by JPMorgan
Chase Bank ("JPMorgan Chase Bank"), as administrative  and collateral agent. The
Senior  Credit  Facility is comprised  of (i) a $200.0  million  senior  secured
revolving  credit facility (the "Revolving  Credit  Facility") and (ii) a $270.0
million  senior  secured B term loan (the "Term Loan  Facility").  The Revolving
Credit  Facility  matures in August 2007,  and allows up to $40.0  million to be
available in the form of letters of credit.

As of  December  24,  2005,  (i) there  were $18.8  million  of cash  borrowings
outstanding  under the Revolving Credit Facility,  (ii) there were $23.6 million
in letters of credit  outstanding,  and therefore (iii)  availability  under the
Revolving Credit Facility was $157.6 million. The Company believes that the cash
flow to be generated by operations and the amounts available under the Revolving
Credit  Facility  provide  adequate  liquidity to fund working capital needs and
expenditures.

The Senior Credit  Facility  bears interest at the Company's  option,  at a base
rate or LIBOR plus,  in each case,  an applicable  percentage.  The  appropriate
applicable percentage  corresponds to the Company's Consolidated Leverage Ratio,
as defined by the senior credit agreement  ("Senior Credit  Agreement"),  and is
adjusted quarterly based on the calculation of the Consolidated  Leverage Ratio.
Based on the Company's  Consolidated Leverage Ratio, effective October 14, 2005,
the Senior Credit  Facility bears interest in the case of base rate loans at the
Base Rate, as defined in the Senior Credit Agreement,  plus (i) 1.25 percent for
loans under the Revolving Credit Facility, and (ii) 1.75 percent for loans under
the Term  Loan  Facility  or in the case of LIBOR  loans at LIBOR  plus (i) 2.25
percent for loans under the Revolving  Credit Facility and (ii) 2.75 percent for
loans under the Term Loan Facility.  The initial unused  commitment fee is 0.375
percent  on the daily  average  unused  commitment  under the  Revolving  Credit
Facility and also varies based on the Company's  Consolidated Leverage Ratio. As
of December 24, 2005, the interest rate under the Revolving  Credit Facility was
approximately  6.59 percent and the interest  rate under the Term Loan  Facility
was approximately 6.97 percent.

The Term Loan Facility requires payments in quarterly installments in the amount
of $675,000 until September 30, 2007. Beginning December 31, 2007, the quarterly
payments are $64.1 million.  The Term Loan Facility  matures in August 2008 upon
which  the  balance  will be due.  The Term Loan  Facility  is also  subject  to
mandatory  prepayments  under various  scenarios as defined in the Senior Credit
Agreement.  There was no "excess cash flow" or other such scenarios for the year
ended June 25, 2005 requiring prepayments under the Term Loan Facility.

As of December  24,  2005,  the  Company is in  compliance  with all  covenants,
restrictions, and requirements under the terms of the Senior Credit Facility.

The Company's obligations under the Senior Credit Facility are collateralized by
a first  priority  lien on: (i)  substantially  all  existing or  after-acquired
assets,  tangible or  intangible,  (ii) the capital stock of Birds Eye Foods and
its domestic subsidiaries, and (iii) 65% of the voting capital stock and 100% of
the  non-voting  capital stock in certain  foreign  subsidiaries.  The Company's
obligations  under  the  Senior  Credit  Facility  are  guaranteed  by Birds Eye
Holdings  Inc.  and  certain of the  Company's  subsidiaries.  See NOTE 9 to the
"Notes  to  Consolidated   Financial  Statements"  for  additional   disclosures
regarding guarantees and indemnifications.

Senior  Subordinated  Notes - 11 7/8 Percent  (due 2008):  In fiscal  1999,  the
Company  issued  Senior  Subordinated  Notes (the  "Notes")  for $200.0  million
aggregate  principal amount due November 1, 2008. As of December 24, 2005, Birds
Eye Foods had  outstanding  $50.0 million of its $200.00  million 11 7/8 percent
Senior Subordinated Notes, due 2008.

Interest  on the Notes  accrues at the rate of 11 7/8  percent  per annum and is
payable semiannually in arrears on May 1 and November 1.

The Notes represent general unsecured  obligations of the Company,  subordinated
in right of payment to certain other debt obligations of the Company  (including
the  Company's  obligations  under the Senior  Credit  Facility).  The Company's
obligations  under the Notes are guaranteed by Kennedy  Endeavors,  Incorporated
and Linden Oaks  Corporation  (wholly-owned  subsidiaries of the Company) and by
Pro-Fac. See NOTE

                                       25





<PAGE>

9 to the "Notes to Consolidated Financial Statements" for additional disclosures
regarding guarantees and indemnifications.

As of December  24,  2005,  the  Company is in  compliance  with all  covenants,
restrictions, and requirements under the Notes.

The Company, principal shareholders, or their affiliates may, from time-to-time,
enter the market to  purchase or sell Senior  Subordinated  Notes in  compliance
with any applicable securities laws.

Off-Balance Sheet Arrangements and Other Commitments:  The Company does not have
material  financial  guarantees  or  other  contractual   commitments  that  are
reasonably likely to adversely affect liquidity.

                          CRITICAL ACCOUNTING POLICIES

The  preparation of the Company's  consolidated  financial  statements  requires
management to make estimates and assumptions  that affect the reported  amounts.
The estimates and  assumptions are evaluated on a regular basis and are based on
historical  experience  and on various  other  factors  that are  believed to be
reasonable.  Estimates and  assumptions  include,  but are not limited to: trade
accounts receivable,  inventories,  identifiable  intangible assets,  long-lived
assets and goodwill,  self-insurance  programs,  promotional activities,  income
taxes and retirement benefits.

The following are  considered  to be the Company's  more critical  estimates and
assumptions used in the preparation of the consolidated financial statements.

Trade  Accounts  Receivable:  The  Company  accounts  for trade  receivables  at
outstanding billed amounts, net of allowances for doubtful accounts. The Company
estimates  its allowance  for doubtful  accounts as a percentage of  receivables
overdue.  Also  included in the allowance in their  entirety are those  accounts
that have  filed for  bankruptcy,  or been  sent to  collections,  and any other
accounts management believes are not collectible based on historical losses. The
Company periodically reviews the accounts included in the allowance to determine
those to be written off. Generally, after a period of one year, or through legal
counsel's  advice,  accounts are written off. It is not Company policy to accrue
interest on past due accounts.

Inventories:  Under the first-in,  first-out  ("FIFO") method, the cost of items
sold is based upon the cost of the first such items produced.  As a result,  the
last such items  produced  remain in  inventory  and the cost of these items are
used to reflect ending inventory.  The Company prices its inventory at the lower
of cost or market value on the FIFO method.

A reserve is  established  for the estimated  aged  surplus,  spoiled or damaged
products,  and  discontinued  inventory items and components.  The amount of the
reserve is  determined  by  analyzing  inventory  composition,  expected  usage,
historical and projected sales information,  and other factors. Changes in sales
volume  due to  unexpected  economic  or  competitive  conditions  are among the
factors that could result in materially different amounts for this reserve.

Identifiable  Intangible Assets,  Long-Lived  Assets, and Goodwill:  The Company
assesses the carrying value of its identifiable intangible assets and long-lived
assets  whenever events or changes in  circumstances  indicate that the carrying
amount of the underlying asset may not be recoverable. Certain factors which may
occur and indicate that an impairment  exists  include,  but are not limited to:
significant  under  performance  relative  to  historical  or  projected  future
operating results; significant changes in the manner of the Company's use of the
underlying  assets;  and  significant  adverse  industry or market  trends.  The
Company tests goodwill for impairment on an annual basis.  In the event that the
carrying  values of assets are  determined  to be  impaired,  the Company  would
record an adjustment to the respective carrying value.

Self-insurance  Programs:  The Company records  estimates for certain health and
welfare and workers' compensation costs that are provided for under self-insured
programs. Should a greater amount of claims occur compared to what was estimated
or should costs of medical care increase beyond what was  anticipated,  reserves
recorded may not be sufficient and additional costs could be incurred.

Promotional  Activities:  The  Company's  promotional  activities  are conducted
either  through the retail trade channel or directly with  consumers and involve
in-store  displays;  feature  price  discounts on the  Company's  products;  and
similar  activities.  The costs of these activities are generally  recognized at
the time the related  revenue is recorded,  which  normally  precedes the actual
cash expenditure. The recognition of these costs therefore requires management's
judgment  regarding  the volume of  promotional  offers that will be redeemed by
either the retail trade  channel or  consumer.  These  estimates  are made using
various  techniques   including   historical  data  on  performance  of  similar
promotional   programs.   Differences   between  estimated  expense  and  actual
redemptions are normally  insignificant and recognized as a change in management
estimate in a subsequent  period.  However,  the likelihood exists of materially
different  reported  results if  different  assumptions  or  conditions  were to
prevail.

Income  Taxes:  The Company  computes its annual tax rate based on the statutory
rates and tax planning opportunities available to it in the

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<PAGE>

various jurisdictions in which it earns income. Significant judgment is required
in  determining  the  Company's  annual  tax  rate  and in  evaluating  its  tax
positions.  The Company establishes reserves when it becomes probable that a tax
return  position that it considers  supportable  may be challenged  and that the
Company may not  succeed in  completely  defending  the  challenge.  The Company
adjusts  these  reserves  in light of  changing  facts  and  circumstances.  The
Company's annual tax rate includes the impact of reserve  provisions and changes
to reserves.  While it is often  difficult  to predict the final  outcome or the
timing of resolution of any particular tax matter, the Company believes that its
reserves  reflect the  probable  outcome of known tax  contingencies.  Favorable
resolution  would be recognized as a reduction to the Company's  annual tax rate
in the year of  resolution.  The  Company's  tax reserves  are  presented in the
balance  sheet  principally  within  income  taxes  refundable  and income taxes
payable.

The Company  records  valuation  allowances to reduce deferred tax assets to the
amount that is more likely than not to be realized.  When assessing the need for
valuation  allowances,  the Company  considers future taxable income and ongoing
prudent and feasible tax planning  strategies.  Should a change in circumstances
lead to a change in judgment about the  realizability  of deferred tax assets in
future  years,  the Company  would adjust  related  valuation  allowances in the
period  that the change in  circumstances  occurs,  along  with a  corresponding
increase or charge to income.

Retirement Benefits:  The Company sponsors pension and other retirement plans in
various forms  covering  employees who meet  eligibility  requirements.  Several
statistical and other factors that attempt to anticipate  future events are used
in  calculating  the expense and liability  related to the plans.  These factors
include  assumptions about the discount rate, expected return on plan assets and
rate of future  compensation  increases  as  determined  by the Company with the
assistance of actuarial  consultants,  within certain  guidelines.  The discount
rate assumptions used to value pension and  postretirement  benefit  obligations
reflect yields on high quality long-term bonds.

Over time, the expected rate of return on pension plan assets should approximate
the actual  long-term  returns.  In developing the expected rate of return,  the
Company  considers   expected  returns  on  risk-free   investments   (primarily
government  bonds), the historical level of the risk premium associated with the
other asset classes in which the portfolio is invested and the  expectations for
future returns of each asset class.  The expected return for each asset class is
weighted based on the target asset allocation to develop the expected  long-term
rate of return on assets assumption.

In addition,  the Company's  actuarial  consultants also use subjective  factors
such as mortality  rates to estimate the expense and liability  related to these
plans. The actuarial  assumptions used by the Company may differ materially from
actual  results due to changing  market and  economic  conditions,  or longer or
shorter  life  spans  of  participants.   These  differences  may  result  in  a
significant impact to the amount of pension expense recorded by the Company.

                                  OTHER MATTERS

Weather  conditions  can  impact  product  costs  within  most  segments  of the
Company's  business.  Favorable weather  conditions can produce high crop yields
and an oversupply  situation,  while  excessive  rain or drought  conditions can
produce  low crop  yields  and a  shortage  situation.  The  utilization  of the
Company's  facilities is directly  correlated to the timing of crop harvests and
crop yields.  Poor weather conditions hurt crop yields and result in uneven crop
delivery  cycles that increase  production  costs.  In addition,  pricing can be
impacted by crop size and yields and the overall  national  supply.  The Company
believes that its geographic diversification helps mitigate these risks

                            MARKET AND INDUSTRY DATA

Unless  otherwise  stated in this  report,  industry  and market share data used
throughout this Form 10-Q Equivalent was derived from industry  sources believed
by the Company to be reliable,  including  information  provided by  Information
Resources,  Inc. Consultants' reports and industry publications  generally state
that the information  contained  therein has been obtained from sources believed
to be reliable,  but that the accuracy and  completeness of such  information is
not guaranteed.  The Company has not independently  verified such data and makes
no representation to its accuracy.

ITEM 3.   QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

The Company, as a result of its operating and financing  activities,  is exposed
to changes in certain commodity prices and interest rate fluctuations, which may
adversely affect its results of operations and financial position. In seeking to
minimize the risks and/or costs associated with such activities, the Company may
enter into derivative  contracts.  Certain of the Company's derivative financial
instruments are reported in the Company's  Annual Report on Form 10-K Equivalent
for the year ended June 25, 2005.  No material  changes  have  occurred in these
instruments which would require additional disclosure in answer to this item.

The following is a description  of derivative  financial  instruments  that were
entered into in the second quarter of fiscal 2006.

Commodity  Prices:  The Company is exposed to  commodity  price risk  related to
forecasted purchases of corrugated (unbleached kraftliner) in

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<PAGE>

its  manufacturing  process.  To mitigate this risk, the Company  entered into a
swap agreement on December 12, 2005, which matures on June 30, 2006. The swap is
for 500 short  tons per month at $505,  per short  ton.  The swap  agreement  is
designated  as  a  cash  flow  hedge  of  the  Company's  forecasted  corrugated
purchases.  The swap will hedge approximately 20 percent of the Company's annual
usage.

Additionally,  to further  mitigate the risk discussed  previously,  the Company
entered into a second  corrugated  swap  agreement  on December 12, 2005,  which
matures on June 30, 2007. The swap is for 1,000 short tons per month at $497 per
short  ton.  The  swap  agreement  is  designated  as a cash  flow  hedge of the
Company's forecasted corrugated purchases.  The swap will hedge approximately 40
percent of the Company's annual usage.

The fair value of these  corrugated  swap agreements as of December 24, 2005 was
approximately $0.1 million.

ITEM  4.  CONTROLS AND PROCEDURES.

Birds Eye Foods management,  with the participation of Birds Eye Foods Principal
Executive Officer and Principal  Financial Officer,  evaluated the effectiveness
of the  design  and  operation  of  Birds  Eye  Foods  disclosure  controls  and
procedures (as defined in Rule 15d-15(e) of the Securities Exchange Act of 1934,
as amended (the  "Exchange  Act")).  Based on that  evaluation,  Birds Eye Foods
Principal  Executive and Principal  Financial  Officers concluded that Birds Eye
Foods disclosure controls and procedures as of December 24, 2005 (the end of the
period  covered  by  this  Report)  have  been  designed  and  are   functioning
effectively to provide reasonable  assurance that the information required to be
disclosed  by Birds  Eye Foods in  reports  filed or  submitted  by it under the
Exchange Act is recorded,  processed,  summarized  and reported  within the time
periods specified in the Securities and Exchange Commission's rules and forms.

There  were no  changes  to Birds Eye Foods'  internal  control  over  financial
reporting  that  occurred  during  the  quarter  ended  December  24,  2005 that
materially  affected or are  reasonably  likely to  materially  affect Birds Eye
Foods' internal control over financial reporting.

                           PART II. OTHER INFORMATION

ITEM 1.   LEGAL PROCEEDINGS.

Information  about any material  developments  that may have occurred since June
25, 2005 is described in NOTE 10, "Other Matters - Legal Matters",  under "Notes
to  Consolidated  Financial  Statements"  in Part I,  Item 1. of this  Form 10-Q
Equivalent and is incorporated herein by reference in answer to this item.

ITEM 5.   OTHER INFORMATION.

Effective  February 1, 2006 Linda K. Nelson,  the Company's  Vice  President and
Controller,  was  designated the Company's  Principal  Accounting  Officer.  Ms.
Nelson,  age 42, has been the Vice  President and  Controller of Birds Eye Foods
since  February,  1999.  Prior  to this  position  she was  Vice  President  and
Corporate  Controller from October 1997 to February 1999, Director of Accounting
and Internal  Audit from October 1996 to October 1997,  and Director of Internal
Audit from October 1995 to October 1996.  Before  joining  Birds Eye Foods,  Ms.
Nelson spent 10 years with  PricewaterhouseCoopers LLP most recently as a Senior
Audit Manager. Ms. Nelson is a Certified Public Accountant.

ITEM 6.   EXHIBITS.

 Exhibits

   Exhibit Number                             Description
   --------------   ------------------------------------------------------------

        10.1        Summary of  Compensation  Arrangements  for Named  Executive
                    Officers  and  Directors  of Birds Eye  Foods,  Inc.  (filed
                    herewith).

        10.2        Fourth  Amendment  to the  Birds Eye  Foods  Excess  Benefit
                    Retirement Plan (filed herewith).

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<PAGE>

   Exhibit Number                             Description
   --------------   ------------------------------------------------------------

        10.3        Amendment  No. 3 to Amended and Restated  Limited  Liability
                    Company Agreement of Agrilink Holdings LLC (filed herewith).

        10.4        Amendment  No. 4 to Amended and Restated  Limited  Liability
                    Company   Agreement   of  Birds  Eye   Holdings  LLC  (filed
                    herewith).

        31.1        Certification required by Rule 13a - 14(a) or Rule 15d-14(a)
                    of the  Securities  Exchange  Act of 1934  of the  Principal
                    Executive Officer (filed herewith).

        31.2        Certification required by Rule 13a - 14(a) or Rule 15d-14(a)
                    of the  Securities  Exchange  Act of 1934  of the  Principal
                    Financial Officer (filed herewith).

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<PAGE>

                           SIGNATURES

The Company has duly caused this 10-Q  Equivalent  to be signed on its behalf by
the undersigned, thereunto duly authorized.

                                                    BIRDS EYE FOODS, INC.

Date: February 3, 2006               By:   /s/       Earl L. Powers
      --------------------                 -------------------------------------
                                                       EARL L. POWERS
                                                EXECUTIVE VICE PRESIDENT and
                                                 CHIEF FINANCIAL OFFICER and
                                                          SECRETARY
                                             (On Behalf of the Registrant and as
                                                Principal Financial Officer)

Date: February 3, 2006               By:   /s/        Linda K. Nelson
      --------------------                 -------------------------------------
                                                      LINDA K. NELSON
                                                VICE PRESIDENT and CONTROLLER
                                             (On Behalf of the Registrant and as
                                                Principal Accounting Officer)

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