**CONTRIBUTION AGREEMENT**

**THIS CONTRIBUTION AGREEMENT** (this "Agreement")is made and entered into as of this 30th day of May, 2006, by andbetween **U.S. Premium Beef, LLC**, a Delaware limited liability company ("USPB"),and **National Beef Packing Company, LLC**, a Delaware limited liabilitycompany (the "Company").  USPB and the Company may be referred to hereinindividually as a "Party" or collectively as the "Parties."

**WHEREAS**, National Beef California, L.P. ("NBC")and the Company have entered into a Contribution Agreement dated as of May 19,2006, (the "Agreement") with Brawley Beef, LLC ("Brawley") underwhich NBC will acquire substantially all the assets of Brawley in exchange forthe assumption of certain liabilities of Brawley and the issuance by NBC of 44,160limited partnership units (the "LP Units"); and

**WHEREAS**, Brawley and USPB have entered into a ContributionAgreement dated as of May 30, 2006, (the "USPB Agreement") under whichBrawley will contribute the LP Units to USPB in exchange for 44,160 Class A and44,160 Class B membership units in USPB (the "USPB Units"); and 

**WHEREAS**, USPB will contribute the LP Units to theCompany, and in exchange the Company shall issue membership units in theCompany to USPB, upon the terms and subject to the conditions set forth in thisAgreement.

**NOW, THEREFORE**, in consideration of the premises setforth above and the mutual covenants contained herein, the receipt andsufficiency of which are hereby acknowledged, and intending to be legally boundhereby, the Parties hereby agree as follows:

**ARTICLE ICONTRIBUTION**

**Section 1.1.         Contribution by USPB. **On the basis of therepresentations, warranties and agreements contained herein, effective as ofthe date of this Agreement (the "Contribution Date"), USPB hereby contributes,assigns, transfers, conveys and delivers to the Company, its successors andassigns all right, title and interest of USPB in the LP Units. 

**ARTICLEIIISSUANCE OF UNITS**

**Section2.1.         Issuance of the Units in the Company.**  Inexchange for the contribution of the LP Units, contemporaneously with the executionof this Agreement, the Company shall issue to USPB 5,899,297 of its Class AMembership Units and 664,475 of its Class B-1 Membership Units in the Company(the "Units").

**Section 2.2.         Conditions to Issuance.**  As a condition to theissuance of the Units, USPB and the other members of the Company shall haveexecuted and delivered the Amendment to its Limited Liability Company Agreement(substantially in the form set forth in Exhibit A attached hereto).

 

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**ARTICLEIIIVALUATION; ALLOCATION**

**Section 3.1.         Contribution Value.**  The Company and USPB agreeand acknowledge that the total value of the LP Units contributed by USPB inexchange for the Units shall be as set forth on Schedule 3.1 attached hereto. The Parties further agree to be bound by such valuations in determining thecapital account relating to the Units and calculating any income, gain, loss,depreciation or other tax credits, allocations, or deductions in respect of theUnits and acknowledge that the valuation was determined pursuant to an arm'slength negotiation.

**ARTICLEIVREPRESENTATIONS AND WARRANTIES OF THE CONTRIBUTOR**

USPB represents and warrants to the Company as follows:

**Section 4.1.         Authority; Due Execution. **USPB has allrequisite power and authority to enter this Agreement, and all other documentscontemplated by this Agreement and to consummate the transactions contemplatedhereby and thereby, and to perform its obligations hereunder and thereunder. The execution and delivery by USPB of this Agreement, and all other documentscontemplated by this Agreement, and the consummation by USPB of the transactionscontemplated hereby and thereby, have been duly authorized. 

**Section 4.2.         Enforceability.**  This Agreement has been dulyand validly executed and delivered by USPB and constitutes the valid andbinding obligations of USPB, enforceable against USPB in accordance with its terms,except as (i) the enforceability hereof or thereof may be limited bybankruptcy, insolvency, moratorium or other similar laws affecting theenforcement of creditors' rights generally and (ii) the availability ofequitable remedies may be limited to equitable principles of generalapplicability. 

**Section 4.3.         No Violation.**  Neither the entering into northe delivery of this Agreement, and all other documents contemplated by thisAgreement nor the completion of the transactions contemplated hereby or therebywill conflict with or result in the violation or default under any of theprovisions of the Articles of Organization or Limited Liability CompanyAgreement of USPB.

**Section 4.4.         Consents.**  No consent, approval, order orauthorization of, a registration, declaration or filing with any governmentalbody is required by or with respect to USPB in connection with the executionand delivery by USPB of this Agreement, and all other documents contemplated bythis Agreement or the consummation by USPB of the transactions contemplatedhereby or thereby.

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**ARTICLE VREPRESENTATIONS AND WARRANTIES OF THE COMPANY**

The Company represents and warrants to USPB as follows:

**Section 5.1.         Authority; Due Execution.**  The Company has allrequisite power and authority to enter this Agreement, and all other documentscontemplated by this Agreement and to consummate the transactions contemplatedhereby and thereby, and to perform its obligations hereunder and thereunder. The execution and delivery by the Company of this Agreement and all otherdocuments contemplated by this Agreement, and the consummation by the Companyof the transactions contemplated hereby and thereby, have been duly authorized.

**Section 5.2.         Enforceability.**  This Agreement has been dulyand validly executed and delivered by the Company and constitutes the valid andbinding obligation of the Company, enforceable against the Company inaccordance with their terms, except as (i) the enforceability hereof or thereofmay be limited by bankruptcy, insolvency, moratorium or other similar lawsaffecting the enforcement of creditors' rights generally and (ii) theavailability of equitable remedies may be limited to equitable principles ofgeneral applicability. 

**Section 5.3.         No Violation.**  The execution and delivery ofthis Agreement and all other documents contemplated by this Agreement by theCompany does not, and the consummation of the transactions contemplated herebyand thereby will not conflict with, or result in any violation of, or defaultunder any provision of the Articles of Organization or Limited LiabilityCompany Agreement of the Company.

**Section 5.4.         Consents.**  No consent, approval, order orauthorization of, or registration, declaration or filing with, any court,administrative agency or commission or other governmental authority orinstrumentality, domestic or foreign, is required by or with respect to theCompany in connection with the execution and delivery of this Agreement and allother documents contemplated by this Agreement or the consummation by theCompany of the transactions contemplated hereby or thereby.

**ARTICLEVICANCELLATION OF ISSUED UNITS**

**Section 6.1.         Tender of USPB Units Under Contribution Agreement.** Section 9.3 of the Contribution Agreement permits Brawley under certaincircumstances to tender all or a portion of the USPB Units to NBC insatisfaction of claims by NBC for breaches of the Contribution Agreement.  Inthe event NBC receives such tendered units (the "Tendered Units"), NBCwill promptly transfer the Tendered Units to USPB for cancellation.  TheCompany will in turn cancel that number of Class A Units and Class B-1 Units heldby USPB that bear the same proportion to the total number of Units of bothclasses issued pursuant to Section 2.1, as the number of Tendered Units bearsto the total number of USPB Units.  By the way of example, if NBC were todeliver 4,416 Class A and 4,416 Class B Tendered Units to USPB forcancellation, the Company would cancel 589,929.7 Class A Units and 66.447.5Class B-1 Units held by USPB.

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**Section 6.2.         Pledged USPB Units. **The USPB Units are subjectto a pledge agreement between Brawley and NBC dated as of May 30, 2006 (the "Pledge Agreement").  In the event NBC or the Company acquires ownership ofUSPB units (the "Foreclosed Units") as a result of foreclosure orother realization under the Pledge Agreement, they shall transfer the ForeclosedUnits to USPB for cancellation.  The Company will in turn cancel that number ofClass A Units and Class B-1 Units held by USPB that bears the same proportionto the total number of Units of both classes issued pursuant to Section 2.1, asthe number of Foreclosed Units bears to the total number of USPB Units.

**ARTICLEVII MISCELLANEOUS**

**Section 7.1.         Amendment and Modification of the Agreement.** This Agreement may be amended, modified or supplemented only by the writtenagreement of the Parties.

**Section 7.2.         Assignment.**  This Agreement and all theprovisions along with any amendments, modifications and waivers hereto shall bebinding upon and shall inure to the benefit of the Parties and their respectivesuccessors and assigns.

**Section 7.3.         Further Assurances.**  Each Party shall do andperform or cause to be done and performed all such further acts and things andshall execute and deliver all such other agreements, certificates, instrumentsand documents as any other Party may reasonably request in order to carry outthe intent and accomplish the purposes of this Agreement, and all otherdocuments contemplated by this Agreement and the consummation of thetransactions contemplated hereby and thereby.

**Section 7.4.         Governing Law.**  This Agreement and the rightsand obligations of the Parties hereunder shall be governed by, and construedand interpreted in accordance with, the laws of the State of Missouri, withoutgiving effect to the choice of law provisions of such State.

**Section 7.5.         Severability.**  If any term or provision of thisAgreement is determined to be invalid, illegal or unenforceable, all otherterms and provisions of this Agreement shall nevertheless remain in full forceand effect so long as the economic or legal substance of the transactionscontemplated herein are not affected in any manner materially adverse to anyParty.  Upon such determination that any term or other provision is invalid,illegal or unenforceable, the Parties shall negotiate in good faith to modifythis Agreement so as to effect the original intent of the Parties as closely aspossible in a mutually acceptable manner.

**Section 7.6.         Notices.**  All notices, consents, requests,instructions, approvals and other communications provided for herein shall bein writing and shall be deemed validly given when (a) delivered to theappropriate address by hand or by nationally recognized overnight courierservice (costs prepaid); (b) sent by facsimile with confirmation oftransmission by the transmitting equipment; or (c) received or rejected by theaddressee, if sent by certified mail, return receipt requested, in each case tothe following addresses, facsimile numbers or e-mail addresses and marked tothe attention of the person (by name or title) designated below (or to suchother address, facsimile number, e-mail address or person as a party maydesignate by notice to the other parties):

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|   | (a) | if to USPB, at:     U.S. Premium Beef, LLC  P. O. Box 20103  Kansas City, MO  64195  Telephone:  (816) 713-8800  Facsimile:  (816) 713-8810  Attention:  Steven D. Hunt     with a copy to:     Lindquist & Vennum, P.L.L.P.  4200 IDS Center  80 South Eighth Street  Minneapolis, MN  55402  Facsimile:  (612) 371-3545  Attention:  Mark J. Hanson    (b)
if to the Company, at:     
NationalBeef Packing Company, LLC
  
12200 North Ambassador Drive
  
Kansas City, Mo  64163
  
Telephone: (816) 713-8800
  
Facsimile: (816) 713-8810
  Attention:  John R. Miller     with a copy to:     Scott H. Smith  2690 Telemark Drive  Park City, Utah  84060  Facsimile:  (435) 649-5675
**Section 7.7.         Headings; Execution in Counterparts.**  Theheadings and captions contained herein are for convenience only and shall notcontrol or affect the meaning or construction of any provision hereto.  ThisAgreement may be executed in any number of counterparts, each of which shall bedeemed to be an original and which together shall constitute one and the sameinstrument.

 

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**IN WITNESS WHEREOF**, this Agreement has been signed asof the date and year first above written.

**U.S. PREMIUM BEEF, LLC**

By:  /s/ Steven D. Hunt                                            Steven D. Hunt, President

**NATIONAL BEEF PACKING COMPANY, LLC**

By:  /s/ John R. Miller                                             John R. Miller, Chief ExecutiveOfficer

 

 

 

 

 

 

 

 

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**SCHEDULE 3.1**

**CONTRIBUTION VALUE**

The total value of the LP Units contributed by the Contributoris $___________, and the total value of the Units issued by the Company inexchange for the contribution is $_____________.

 

 

 

 

 

 

 

 

 

 

 

 

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