UNITED STATES SECURITIES AND EXCHANGE COMMISSION

                              WASHINGTON, DC 20549

                                    Form 10-K

  (Mark One)
     [X]        Annual Report Pursuant to Section 13 or 15(d) of the
                         Securities Exchange Act of 1934
                     For the Fiscal Year Ended June 24, 2000

     [ ] Transition Report Pursuant to Section 13 or 15(d) of the
                         Securities Exchange Act of 1934
                        For the Transition Period from to
                                File No. 0-20539

                            PRO-FAC COOPERATIVE, INC.

             (Exact Name of Registrant as Specified in Its Charter)

         New York                                        16-6036816
(State or other jurisdiction of                         (IRS Employer
incorporation or organization                        Identification Number)

        90 Linden Oaks, PO Box 682, Rochester, NY        14603
          (Address of Principal Executive Offices)     (Zip Code)


       Registrant's telephone number, including area code: (716) 383-1850
        Securities Registered Pursuant to Section 12(b) of the Act: None

           Securities Registered Pursuant to Section 12(g) of the Act:

                       Class A Cumulative Preferred Stock

                       Liquidation Preference $25.00/Share

                              Par Value $1.00/Share

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   X      NO
                                        ------

Indicate by check mark if disclosure of delinquent  filers  pursuant to ITEM 405
of Regulation  S-K is not contained  herein,  and will not be contained,  to the
best of registrant's  knowledge,  in definitive proxy or information  statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. [X]

Aggregate market value of voting stock held by  non-affiliates of the registrant
as of August 26, 2000
                        Class A Common Stock: $10,664,905
                        Class B Common Stock: $         0

(based upon par value of shares  since  there is no market for the  Registrant's
common stock)

Number of common shares outstanding at August 26, 2000:

                        Class A Common Stock: 2,132,981
                        Class B Common Stock:   723,229


<PAGE>


                         FORM 10-K ANNUAL REPORT - 2000

                            PRO-FAC COOPERATIVE, INC.

                                TABLE OF CONTENTS

                                     PART I
<TABLE>
                                                                                                                PAGE


<S>         <C>                                                                                                 <C>
ITEM  1.    Description of Business
                Cautionary Statement on Forward-Looking Statements..........................................      3
                General Development of Business.............................................................      3
                Narrative Description of Business...........................................................      5
                Financial Information About Industry Segments...............................................      7
                Packaging and Distribution..................................................................      7
                Trademarks..................................................................................      7
                Raw Material Sources........................................................................      7
                Environmental Matters.......................................................................      8
                Seasonality of Business.....................................................................      8
                Practices Concerning Working Capital........................................................      9
                Significant Customers.......................................................................      9
                Backlog of Orders...........................................................................      9
                Business Subject to Government Contracts....................................................      9
                Competitive Conditions......................................................................      9
                Market and Industry Data....................................................................     10
                New Products and Research and Development...................................................     10
                Employees...................................................................................     10
ITEM  2.    Description of Properties.......................................................................     10
ITEM  3.    Legal Proceedings...............................................................................     11
ITEM  4.    Submission of Matters to a Vote of Security Holders.............................................     11

                                     PART II

ITEM  5.    Market for Registrant's Common Stock and Related Security Holder Matters........................     12
ITEM  6.    Selected Financial Data.........................................................................     13
ITEM  7.    Management's Discussion and Analysis of Financial Condition and Results of Operations...........     14
ITEM  7A.   Quantitative and Qualitative Disclosures About Market Risk......................................     25
ITEM  8.    Financial Statements and Supplementary Data.....................................................     25
ITEM  9.    Changes in and Disagreements with Accountants on Accounting and Financial Disclosure............     55

                                    PART III

ITEM 10.    Directors and Executive Officers of the Registrant..............................................     56
ITEM 11.    Executive Compensation..........................................................................     59
ITEM 12.    Security Ownership of Certain Beneficial Owners and Management..................................     61
ITEM 13.    Certain Relationships and Related Transactions..................................................     63

                                     PART IV

ITEM 14.    Exhibits, Financial Statement Schedules and Reports on Form 8-K.................................     65
            Signatures......................................................................................     69
</TABLE>


<PAGE>

                                     PART I

ITEM 1.       DESCRIPTION OF BUSINESS

              CAUTIONARY STATEMENT ON FORWARD-LOOKING STATEMENTS

From  time  to  time,   the  Pro-Fac   Cooperative,   Inc.   ("Pro-Fac"  or  the
"Cooperative")   makes  oral  and  written   statements   that  may   constitute
"forward-looking  statements"  as defined in the Private  Securities  Litigation
Reform Act of 1995 (the  "Act") or by the  Securities  and  Exchange  Commission
("SEC") in its rules, regulations, and releases. The Cooperative desires to take
advantage  of the  "safe  harbor"  provisions  in the  Act  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  (pages  14 to 24) and other  statements  made in this Form 10-K and in
other filings with the SEC.

The Cooperative cautions readers that any such  forward-looking  statements made
by  or  on  behalf  of  the  Cooperative  are  based  on  management's   current
expectations  and beliefs but are not guarantees of future  performance.  Actual
results  could  differ  materially  from  those  expressed  or  implied  in  the
forward-looking   statements.   Among  the   factors   that  could   impact  the
Cooperative's ability to achieve its goals are:

     the impact of strong competition in the food industry;

     the impact of changes in consumer demand;

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

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

     the  continuation of the Cooperative'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;

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

     the Cooperative's ability to service debt.

                         GENERAL DEVELOPMENT OF BUSINESS

Pro-Fac Cooperative,  Inc. is an agricultural  cooperative corporation formed in
1960 under the  Cooperative  Corporation  Laws of New York to process and market
crops grown by its members.  Unless the context  otherwise  requires,  the terms
"Cooperative"  and  "Pro-Fac"  refer  to  Pro-Fac  Cooperative,   Inc.  and  its
subsidiaries.  On March 1, 2000, the  Cooperative  announced it will being doing
business as  Agrilink.  In addition,  the board of directors of Agrilink  Foods,
Inc., a wholly-owned  subsidiary of the Cooperative,  and Pro-Fac have agreed to
conduct  joint  meetings,   coordinate  their  activities,   and  to  act  on  a
consolidated basis.  Although Pro-Fac Cooperative,  Inc. will continue to be the
legal  entity  of the  Cooperative,  with the  same  structure  and  regulations
required by bank credit agreements and bond indentures,  and with the same stock
symbol,  "PFACP," it will be presented as Agrilink for all other communications.
Pro-Fac's  Class A Cumulative  preferred  stock is listed on the Nasdaq National
Marketing System.

Pro-Fac  crops include  fruits  (cherries,  apples,  blueberries,  peaches,  and
plums),  vegetables (snap beans,  beets,  cucumbers,  peas, sweet corn, carrots,
cabbage,  squash,  asparagus,  potatoes,  turnip roots,  and leafy greens),  and
popcorn. Only growers of crops marketed through Pro-Fac (or associations of such
growers)  can become  members of Pro-Fac;  a grower  becomes a member of Pro-Fac
through the purchase of common stock.  Pro-Fac's  membership is divided into two
separate  classes.  Members  owning  shares of Class A common  stock are Class A
members,  and members owning shares of Class B common stock are Class B members.
Class A members are members who deliver raw product for sale and  processing  at
the facilities of Agrilink Foods.  There are  approximately 626 Class A members,
consisting  of  individual  growers  or  of  associations  of  growers,  located
principally  in  the  states  of New  York,  Delaware,  Pennsylvania,  Illinois,
Michigan, Washington, Oregon, Iowa, Nebraska, Florida, and Georgia.

There are approximately 150 Class B members who deliver raw product for sale and
processing  at  AgriFrozen  Foods,  a subsidiary  of Pro-Fac.  These growers are
located in the states of Oregon and Washington.

Agrilink Foods, Inc. ("Agrilink Foods"),  incorporated in New York in 1961, is a
producer  and  marketer of  processed  food  products.  Agrilink  Foods has four
primary product lines including:  vegetables,  fruits, snacks, and canned meals.
The  majority  of each of the  product  lines'  net sales is within  the  United
States. In addition, all of Agrilink Foods' operating facilities,  excluding one
in Mexico, are within the United States.


<PAGE>


On November 3, 1994,  Pro-Fac acquired Agrilink Foods, and Agrilink Foods became
a  wholly-owned  subsidiary  of  Pro-Fac.  Pro-Fac  and  Agrilink  Foods  have a
long-standing  contractual relationship pursuant to which Pro-Fac provides crops
and financing to Agrilink Foods, Agrilink Foods provides a market and management
to  Pro-Fac,  and  Pro-Fac  shares  in  the  profits  of  Agrilink  Foods.  Upon
consummation  of the  acquisition,  Pro-Fac and Agrilink  Foods entered into the
Pro-Fac   Marketing  and   Facilitation   Agreement   (the  "Pro-Fac   Marketing
Agreement").

The  Pro-Fac  Marketing  Agreement  provides  for  Pro-Fac  to supply  crops and
additional  financing to Agrilink Foods,  for Agrilink Foods to provide a market
and management services to Pro-Fac,  and for Pro-Fac to share in the profits and
losses of Agrilink Foods. Pro-Fac is required to reinvest at least 70 percent of
any additional  patronage income in Agrilink Foods. To preserve the independence
of Agrilink Foods, the Pro-Fac Marketing Agreement also requires that certain of
the  directors  of  Agrilink  Foods  be  individuals  who are not  employees  or
shareholders  of, or  otherwise  affiliated  with,  Pro-Fac  or  Agrilink  Foods
("Disinterested  Directors") and requires that certain  decisions be approved by
the Disinterested Directors.

Additional  patronage  income  received by Pro-Fac is  deductible to Pro-Fac for
federal tax purposes only to the extent distributed to its members.  Pro-Fac may
make this  distribution to its members through a combination of cash and retains
as long as a minimum of 20 percent of the amount is paid in cash as  required by
federal tax law.  Pro-Fac has  historically  paid its members between 20 percent
and 30 percent of additional  patronage income in cash and the remaining portion
in retains.  Funds made available by the  distribution  of retains to members in
lieu of cash have historically been reinvested by Pro-Fac in Agrilink Foods. See
further  discussion of the relationship  with Pro-Fac in NOTE 2 to the "Notes to
Consolidated Financial Statements."

Dean Foods Vegetable Company: On September 24, 1998, Agrilink Foods acquired the
Dean Foods Vegetable Company ("DFVC"),  the frozen and canned vegetable business
of Dean Foods Company ("Dean Foods"),  by acquiring all the outstanding  capital
stock of Dean  Foods  Vegetable  Company  and  Birds Eye de Mexico SA de CV (the
"DFVC  Acquisition").  In connection with the DFVC  Acquisition,  Agrilink Foods
sold its aseptic  business to Dean Foods.  Agrilink  Foods paid $360  million in
cash,  net of the sale of the aseptic  business,  and issued to Dean Foods a $30
million unsecured subordinated  promissory note due November 22, 2008 (the "Dean
Foods Subordinated Promissory Note"), as consideration for the DFVC Acquisition.
Agrilink Foods had the right,  exercisable  until July 15, 1999, to require Dean
Foods,  jointly with Agrilink Foods,  to treat the DFVC  Acquisition as an asset
sale for tax purposes under Section  338(h)(10) of the Internal Revenue Code. On
April 15, 1999,  Agrilink  Foods paid $13.2  million to Dean Foods and exercised
the election.

After the DFVC  Acquisition,  DFVC was merged into Agrilink Foods. DFVC has been
one of the leading  processors of vegetables in the United  States,  selling its
products  under  well-known  brand names,  such as Birds Eye,  Birds Eye Voila!,
Freshlike and Veg-All, and various private labels.  Agrilink Foods believes that
the DFVC Acquisition  strengthens its competitive position by: (i) enhancing its
brand  recognition and market position,  (ii) providing  opportunities  for cost
savings  and  operating  efficiencies  and  (iii)  increasing  its  product  and
geographic diversification.

Concurrently  with the DFVC  Acquisition,  Agrilink  Foods  refinanced  its then
existing  indebtedness (the "Refinancing"),  including its 12 1/4 percent Senior
Subordinated  Notes due 2005 (the "Old Notes") and its then  existing bank debt.
On August 24, 1998, Agrilink Foods commenced a tender offer (the "Tender Offer")
for all the Old Notes and a consent solicitation to certain amendments under the
indenture governing the Old Notes to eliminate substantially all the restrictive
covenants and certain events of default therein.  Substantially  all of the $160
million aggregate  principal amount of the Old Notes were tendered and purchased
by Agrilink Foods for aggregate  consideration  of  approximately  $184 million,
including  accrued interest of $2.9 million.  Agrilink Foods also terminated its
then existing bank facility  (including  seasonal  borrowings) and repaid $176.5
million,  excluding  interest  owed and breakage  fees  outstanding  thereunder.
Agrilink  Foods  recognized  an  extraordinary  charge of $18.0  million (net of
income taxes) in the first quarter of fiscal 1999 relating to this refinancing.

In order to consummate the DFVC  Acquisition  and the Refinancing and to pay the
related  fees and  expenses,  Agrilink  Foods:  (i)  entered  into a new  credit
facility  (the "New Credit  Facility")  providing  for $455 million of term loan
borrowings (the "Term Loan Facility") and up to $200 million of revolving credit
borrowings (the "Revolving Credit Facility"),  (ii) entered into and drew upon a
$200 million  bridge loan facility (the "Bridge  Facility") and (iii) issued the
$30 million Subordinated  Promissory Note to Dean Foods. The Bridge Facility was
repaid during November of 1998  principally  with the proceeds from a new Senior
Subordinated  Note  Offering  (the  "New  Notes").  See NOTE 5 to the  "Notes to
Consolidated  Financial  Statements - Debt - Senior  Subordinated Notes - 11-7/8
Percent due 2008." Debt issue costs of $5.5 million  associated  with the Bridge
Facility were expensed during the quarter ended December 26, 1998.


<PAGE>


The New Credit  Facility  and the New Notes  restrict  the ability of Pro-Fac to
amend the Pro-Fac Marketing Agreement. The New Credit Facility and the New Notes
also  restrict the amount of dividends  and other  payments  that may be made by
Agrilink Foods to Pro-Fac.

Agripac,  Inc.:  PF  Acquisition  II,  Inc.  ("PF II") is also a  subsidiary  of
Pro-Fac. PF II was incorporated in January 1999. Pro-Fac owns 100 percent of the
common stock of PF II, while PFA Northwest Growers Cooperative,  Inc., an Oregon
Cooperative, Inc., owns 100 percent of PF II preferred stock.

On February 23, 1999, PF II acquired the frozen  vegetable  business of Agripac,
Inc. ("Agripac"),  an Oregon cooperative. PF II conducts business under the name
AgriFrozen Foods ("AgriFrozen").

On January 4, 1999,  Agripac filed a voluntary  petition under Chapter 11 of the
Bankruptcy  Code in the  United  States  Bankruptcy  Court for the  District  of
Oregon.  On January 22, 1999 Agripac,  as  debtor-in-possession,  filed a motion
with the Bankruptcy Court for authority to sell  substantially all of the assets
comprising its frozen food processing  business.  The bankruptcy court confirmed
the sale of Agripac's  frozen food  processing  assets to AgriFrozen by an order
entered on February 18, 1999.

The  contractual  relationship  between  AgriFrozen  and Pro-Fac is defined in a
marketing and facilitation  agreement between the two companies (the "AgriFrozen
Marketing Agreement").  Under that agreement,  AgriFrozen purchases raw products
from Pro-Fac and processes and markets the finished  products.  AgriFrozen  will
pay Pro-Fac  commercial  market value ("CMV") for the crops supplied by Pro-Fac.
In addition,  in any year in which  AgriFrozen  has  earnings,  AgriFrozen  will
distribute such earnings to members of Pro-Fac. However, in the event AgriFrozen
experiences any losses, AgriFrozen deducts the losses from the total CMV payable
to Pro-Fac. The agreement permits AgriFrozen to pay 20 percent of any additional
earnings in cash and retain 80 percent as working capital.

                        NARRATIVE DESCRIPTION OF BUSINESS

The  Cooperative  sells products in three  principal  categories:  (i) "branded"
products,  which  are  sold  under  various  trademarks,  (ii)  "private  label"
products, which are sold to grocers who in turn use their own brand names on the
products  and (iii)  "food  service"  products,  which are sold to food  service
institutions such as restaurants,  caterers,  bakeries,  and schools.  In fiscal
2000,  approximately 59 percent of the  Cooperative's net sales were branded and
the remainder  divided  between private label and food  service/industrial.  The
Cooperative's branded products are listed under the "Trademarks" section of this
report.  The  Cooperative's  private label  products  include  canned and frozen
vegetables, salad dressings, salsa, fruit fillings and toppings, Southern frozen
vegetable specialty products, and frozen breaded and battered products which are
sold  to  customers  such  as  Albertson's,   Kroger,  Fleming,  Piggly  Wiggly,
Wal-Mart/Sam's,   Safeway,   SuperValu,   Topco,  Wegmans  and  Winn-Dixie.  The
Cooperative's food  service/industrial  products include salad dressings,  fruit
fillings  and  toppings,   canned  and  frozen   vegetables,   frozen   Southern
specialties,  frozen breaded and battered products, and canned and frozen fruit,
which are sold to customers  such as Alliant Food Service,  Borden's,  Church's,
Disney, Food Service of America, KFC, MBM, McDonald's, PYA, and SYSCO.

The Cooperative has four primary product lines: vegetables,  fruits, snacks, and
canned meals.  A description  of the  Cooperative's  four primary  product lines
follows:

Vegetables: The vegetable product line consists of canned and frozen vegetables,
chili beans, and various other products. Additional products include value-added
items such as frozen vegetable blends, and  southern-specialty  products such as
black-eyed peas,  okra,  Southern squash,  Southern  specialty side dishes,  and
stewed  tomatoes.  Branded  products  within the vegetable  product line include
Birds Eye, Birds Eye Voila!,  Freshlike,  Veg-All,  McKenzies,  and Brooks Chili
Beans.   In  fiscal  2000,   vegetable   product  line  net  sales   represented
approximately  70 percent of the  Cooperative's  total net  sales.  Within  this
product line net sales of approximately 56 percent represented branded products,
17 percent  represented  private label products and 27 percent  represented food
service/industrial products.

On June 23,  2000,  Agrilink  Foods  sold its pickle  business  based in Tacoma,
Washington to Dean Pickle and Specialty  Products Company,  a subsidiary of Dean
Foods. This business included pickle, pepper, and relish products sold primarily
under the Nalley and  Farman's  brand  names.  Agrilink  Foods will  continue to
contract pack Nalley and Farman's  pickle  products for a period of two years at
the existing Tacoma processing plant which Agrilink Foods will operate.  Under a
related  agreement,  the  Cooperative  will  supply raw  cucumbers  grown in the
Northwestern United States to Dean Pickle and Specialty Products Company,  for a
minimum 10-year period at market pricing.

On December 17, 1999,  Agrilink  Foods sold its  Cambria,  Wisconsin  processing
facility  to Del  Monte.  This  facility  was  primarily  utilized  for  canning
operations.


<PAGE>


On  November  8, 1999,  Agrilink  Foods sold its Midwest  private  label  canned
vegetable  business  to  Seneca  Foods.  Included  in this  transaction  was the
Arlington,  Minnesota facility. This sale did not include Agrilink Foods' retail
branded canned vegetables Veg-All and Freshlike.

On  September  24,  1998,  Agrilink  Foods  acquired  the DFVC frozen and canned
vegetable  businesses.  DFVC was one of the leading  processors of vegetables in
the United States  selling its products  under  well-known  brands such as Birds
Eye, Freshlike, and Veg-All, and various private labels.

Effective March 30, 1998, Agrilink Foods acquired the majority of assets and the
business of DelAgra Corp. of Bridgeville, Delaware. DelAgra Corp. was a producer
of private label frozen vegetables.

In the fall of 1997,  Agrilink  Foods  was  named  the sole  supplier  of frozen
vegetables for all Sam's club stores across the United States.  Shipments  began
in the fourth quarter of fiscal 1998, and full  distribution  occurred in fiscal
1999.

Effective  July 1, 1997,  Agrilink  Foods and  Flanagan  Brothers,  Inc. of Bear
Creek,  Wisconsin contributed all their assets involved in sauerkraut production
to form a new sauerkraut  company.  This new company,  Great Lakes Kraut Company
LLC,  operates  as a New York  limited  liability  company  with  ownership  and
earnings divided equally between the two companies.  This joint venture includes
the Silver Floss and Krrrrisp Kraut brands.

Fruits:  The fruit product line  consists of canned and frozen fruits  including
fruit fillings and toppings.  Branded products within the fruit category include
Comstock and  Wilderness.  The  Cooperative  is a major  supplier of branded and
private label fruit fillings to retailers and food service  institutions such as
restaurants, caterers, bakeries, and schools. In fiscal 2000, fruit product line
net sales  represented  approximately 9 percent of the  Cooperative's  total net
sales.   Within  this  product  line  net  sales  of  approximately  55  percent
represented branded products, 13 percent represented private label products, and
32 percent represented food service/industrial products.

Snacks:  The snacks  product line consists of several  varieties of potato chips
including  regular and kettle fried,  as well as popcorn,  cheese  curls,  snack
mixes,  and other  corn-based  snack items.  Kettle fried potato chips produce a
potato chip that is thicker and crisper  than other potato  chips.  Items within
this product line are marketed primarily in the Pacific  Northwest,  Midwest and
Mid-Atlantic  states.  Branded  products within the snack category include Tim's
Cascade Chips, Snyder of Berlin, Husman, La Restaurante,  Erin's, Pops-Rite, and
Super Pop. In fiscal 2000 snacks net sales  represented  approximately 7 percent
of the  Cooperative's  total net sales.  Within this product line,  net sales of
approximately 93 percent  represented  branded products,  5 percent  represented
private  label  products,  and 2  percent  represented  food  service/industrial
products.

Effective  June 24,  2000,  Agrilink  Foods  acquired  the  Flavor  Destinations
trademark for snack items and will  manufacture  and market this regional  brand
through its Tim's Cascade Chips business in Auburn, Washington.

Effective July 21, 1998,  Agrilink Foods acquired J.A. Hopay  Distributing  Co.,
Inc. ("Hopay") of Pittsburgh,  Pennsylvania.  Hopay was a former distributor for
Snyder of Berlin products.

Effective March 10, 1998, Agrilink Foods acquired the majority of the assets and
the business of C&O  Distributing  Company  ("C&O") of Canton,  Ohio.  C&O was a
former distributor for Snyder of Berlin products.

Canned Meals: The canned meal product line includes canned meat products such as
chilies,  stews,  soups, and various other  ready-to-eat  prepared meals.  Items
within this  product  line are  marketed  primarily  in the  Pacific  Northwest.
Branded  products within the canned meal category  include  Nalley.  Within this
product  line,  net  sales  of  approximately  75  percent  represented  branded
products,  20  percent  represented  private  label  products,   and  5  percent
represented food  service/industrial  products.  In fiscal 2000 canned meals net
sales represented approximately 5 percent of the Cooperative's total net sales.

Other:  Agrilink Foods' other product line primarily represents salad dressings.
Branded products within this category include  Bernstein's and Nalley. In fiscal
2000, other net sales  represented  approximately 4 percent of the Cooperative's
total net sales.

On January 29, 1999,  the Company sold the Adams brand peanut butter  operations
to the J. M. Smucker Company.



<PAGE>


                  FINANCIAL INFORMATION ABOUT INDUSTRY SEGMENTS

The  business of the  Cooperative  is  principally  conducted  in four  industry
segments: vegetables, fruits, canned meals, and snacks. The financial statements
for the fiscal  years ended June 24,  2000,  June 26,  1999,  and June 27, 1998,
which are included in this  report,  reflect the  information  relating to those
segments for each of the Cooperative's last three fiscal years.

                           PACKAGING AND DISTRIBUTION

The food  products  produced  by the  Cooperative  are  distributed  to  various
consumer  markets  in all 50 states.  International  sales  account  for a small
portion of the Cooperative's  activities.  Vegetables,  fruits, and canned meals
are primarily sold through food brokers who sell primarily to supermarket chains
and various  institutional  entities.  Snack  products  are  primarily  marketed
through  distributors  (some of which are owned and operated by the Cooperative)
who sell  directly to retail  outlets in the Midwest,  Mid-Atlantic  and Pacific
Northwest.  Customer  brand  operations  encompass  the sale of  products  under
private labels to chain stores and under the controlled labels of buying groups.
The Cooperative has developed  central storage and distribution  facilities that
permit multi-item single shipment to customers in key marketing areas.

Effective  March 31, 1998,  Agrilink  Foods  entered  into a multiyear  logistic
agreement under which GATX Logistics provides freight management,  packaging and
labeling services,  and distribution  support to and from production  facilities
owned by Agrilink Foods in and around Coloma,  Michigan.  The agreement included
the sale of Agrilink Foods' labeling equipment and distribution center.

On June 27, 1997,  Americold  acquired Agrilink Foods' frozen foods distribution
center in Montezuma,  Georgia.  In addition,  the two  companies  entered into a
long-term  logistics  agreement under which Americold  manages this facility and
all frozen food  transportation  operations of Agrilink Foods in Georgia and New
York.

                                   TRADEMARKS

The major  brand  names under which the  Cooperative  markets its  products  are
trademarks of the Cooperative. Such brand names are considered to be of material
importance  to the  business  of the  Cooperative  since they have the effect of
developing brand  identification  and maintaining  consumer  loyalty.  There are
trademark registrations for substantially all of the trademarks. These trademark
registrations  are of  perpetual  duration  so  long as  they  are  periodically
renewed. It is the Cooperative's intent to maintain its trademark registrations.
The major brand names utilized by the Cooperative are:

<TABLE>
Product Line                                                               Brand Name

<S>                        <C>
Vegetables                 Birds Eye, Voila! (1), Freshlike, Veg-All, Brooks, Chill-Ripe, Comstock, Greenwood, McKenzie's,
                           McKenzie's Gold King, Southern Farms, Southland, Farman's, Nalley, Pixie, Thank You, Silver Floss(2),
                           Krrrrisp Kraut(2)

Fruits                     Birds Eye, Chill-Ripe, Comstock, Globe, McKenzies, Orchard Farm, Orchard Fresh, Pixie, Southern Farms,
                           Thank You, West Bay, Wilderness, Tropic Isle

Snacks                     Snyder of Berlin, Thunder Crunch, Tim's Cascade Chips, Husman, La Restaurante, Erin's, Naturally Good,
                           Beehive, Pops-Rite, Savoral, Super Pop, Flavor Destinations

Canned Meals               Nalley, Mariners Cove, Riviera

Other                      Bernstein's, Nalley

<FN>
(1)  An application has been filed and registration is pending.

(2)  Represent trademarks of Great Lakes Kraut Company, LLC.  Agrilink Foods owns a 50 percent interest in this joint venture.
</FN>
</TABLE>


                              RAW MATERIAL SOURCES

Agrilink  Foods  acquired  approximately  55  percent  of the  raw  agricultural
products supplied by Pro-Fac from Class A members of the Cooperative. AgriFrozen
acquired  approximately 62 percent of the raw agricultural  products supplied by
Pro-Fac from Class B members of the  Cooperative.  Agrilink Foods and AgriFrozen
also  purchased  on the open  market  some crops of the same type and quality as
those  purchased  from Pro-Fac.  Such open market  purchases may occur at prices
higher or lower than those paid to Pro-Fac


<PAGE>


for similar products.  See further  discussion of the relationship with Agrilink
Foods  and  AgriFrozen  in  NOTE  2 to  the  "Notes  to  Consolidated  Financial
Statements."

The vegetable and fruit portions of the business can be positively or negatively
affected  by weather  conditions  nationally  and the  resulting  impact on crop
yields.  Favorable  weather  conditions  can  produce  high crop  yields  and an
oversupply  situation.  This situation  typically  results in depressed  selling
prices and reduced  profitability  on the  inventory  produced  from that year's
crops.  Excessive  rain or drought  conditions can produce low crop yields and a
shortage  situation.  This  typically  results  in  higher  selling  prices  and
increased  profitability.  While the  national  supply  situation  controls  the
pricing, the supply can differ regionally because of variations in weather.

The Cooperative purchases all of its requirements for nonagricultural  products,
including  containers,  in the open  market.  Although the  Cooperative  has not
experienced  any  difficulty  in  obtaining  adequate  supplies  of such  items,
occasional periods of short supply of certain raw materials may occur.

                              ENVIRONMENTAL MATTERS

The disposal of solid and liquid waste material  resulting from the  preparation
and  processing  of foods and the  emission of wastes and odors  inherent in the
heating of foods during  preparation are subject to various federal,  state, and
local environmental laws and regulations.  Such laws and regulations have had an
important  effect  on  the  food  processing  industry  as  a  whole,  requiring
substantially  all firms in the  industry  to incur  material  expenditures  for
modification of existing processing facilities and for construction of new waste
treatment  facilities.  The Cooperative is also subject to standards  imposed by
regulatory  agencies  pertaining  to the  occupational  health and safety of its
employees.  Management believes that continued measures to comply with such laws
and  regulations  will not have a material  adverse effect upon its  competitive
position or financial condition.

Among the various programs for the protection of the environment which have been
adopted by the Cooperative to date, the most important for the operations of the
Cooperative  are the waste water discharge  permit programs  administered by the
environmental  protection agencies in those states in which the Cooperative does
business  and  by the  federal  Environmental  Protection  Agency.  Under  these
programs, permits are required for processing facilities which discharge certain
wastes into streams and other bodies of water,  and the  Cooperative is required
to meet certain  discharge  standards in accordance  with  compliance  schedules
established  by such  agencies.  The  Cooperative  has received  permits for all
facilities  for which permits are required.  Each year the  Cooperative  submits
applications for renewal permits as required for the facilities.

While the  Cooperative  cannot predict with certainty the effect of any proposed
or future environmental legislation or regulations on its processing operations,
management of the Cooperative believes that the waste disposal systems which are
now in operation or which are being  constructed  or designed are  sufficient to
comply with all currently applicable laws and regulations.

The  Cooperative  is  cooperating  with  environmental  authorities in remedying
various minor  environmental  matters at several of its plants. Such actions are
being conducted pursuant to procedures approved by the appropriate environmental
authorities at a cost that is not expected to be material.

Expenditures related to environmental  programs and facilities have not had, and
are not expected to have, a material effect on the earnings of the  Cooperative.
In fiscal 2000,  total  capital  expenditures  of Pro-Fac were $27.0  million of
which  approximate $0.1 million was devoted to the construction of environmental
facilities.   The   Cooperative   estimates  that  the   environmental   capital
expenditures  will be  approximately  $0.6  million  for the 2001  fiscal  year.
However, there can be no assurance that expenditures will not be higher.

                             SEASONALITY OF BUSINESS

From the point of view of sales,  the business of the  Cooperative is not highly
seasonal,  since the demand for its products is fairly  constant  throughout the
year.  Exceptions  to this general rule include some  products  that have higher
sales  volume in the cool weather  months (such as canned and frozen  fruits and
vegetables, chili, and fruit fillings and toppings), and others that have higher
sales  volume  in the warm  weather  months  (such as  potato  chips  and  salad
dressings).  Since many of the raw  materials  processed  by Agrilink  Foods and
AgriFrozen are agricultural crops, production of these products is predominantly
seasonal, occurring during and immediately following the harvest seasons of such
crops.


<PAGE>
                           PRACTICES CONCERNING WORKING CAPITAL

Agrilink Foods and AgriFrozen must maintain substantial  inventories  throughout
the year of finished  products  produced  from  seasonal  raw  materials.  These
inventories are generally financed through seasonal borrowings.

A Revolving Credit Facility is available to Agrilink Foods and is used primarily
for  seasonal  borrowing,  the amount of which  fluctuates  during  the year.  A
short-term  line of  credit is also  available  to  AgriFrozen  and is also used
primarily for seasonal borrowings, the amount of which fluctuates.  AgriFrozen's
obligations  under its line of credit are not  guaranteed by Pro-Fac or Agrilink
Foods and are expressly non-recourse as to Pro-Fac and Agrilink Foods.

Both the  maintenance  of substantial  inventories  and the practice of seasonal
borrowing are common to the food processing industry.

                              SIGNIFICANT CUSTOMERS

The  Cooperative's  industry  segments are not dependent  upon the business of a
single customer or a few customers.  The Cooperative does not have any customers
to whom  sales are made in an amount  which  equals  10  percent  or more of the
Cooperative's net sales.

                                BACKLOG OF ORDERS

Backlog of orders has not  historically  been significant in the business of the
Cooperative.  Orders  are filled  shortly  after  receipt  from  inventories  of
packaged and processed foods.

                   BUSINESS SUBJECT TO GOVERNMENTAL CONTRACTS

No  material   portion  of  the  business  of  the  Cooperative  is  subject  to
renegotiation of contracts with, or termination by, any governmental agency.

                             COMPETITIVE CONDITIONS

All products of the Cooperative,  particularly  branded  products,  compete with
those  of other  national  and  major  regional  food  processors  under  highly
competitive  conditions.  The  principal  methods  of  competition  in the  food
industry are a ready availability of a broad line of products,  product quality,
price, and advertising and sales promotion.

Quality  of  product  and  uniformity  of  quality  are  important   methods  of
competition. Sourcing of product from the members of Pro-Fac allows control over
the quality and  uniformity  of much of the raw product that is  purchased.  The
members of Pro-Fac generally operate relatively large production operations with
emphasis on mechanized growing and harvesting techniques. This factor is also an
advantage in producing uniform, high-quality food products.

The  Cooperative's  pricing  is  generally  competitive  with that of other food
processors  for products of comparable  quality.  Branded  products are marketed
under  national and regional  brands.  In fiscal  2000,  marketing  programs for
national  brands  focused  primarily  on Birds  Eye  Voila!  and  Birds Eye Baby
Vegetables.  The national advertising  campaign included television,  magazines,
coupons,  and in-store  promotions.  Marketing  programs for regional brands are
focused on local tastes and preferences as a means of developing  consumer brand
loyalty.  Regional  advertising  campaigns  included  magazines,   coupons,  and
in-store promotions.

Although  the  relative  importance  of  the  above  factors  may  vary  between
particular products or customers,  the above description is generally applicable
to all of the products of the  Cooperative in the various  markets in which they
are distributed.

Profit  margins for fruits and  vegetables  are  subject to industry  supply and
demand  fluctuations,  attributable  to changes in growing  conditions,  acreage
planted,  inventory carryover, and other factors. The Cooperative has endeavored
to protect against changing growing conditions through geographical expansion of
its sources of supply.

The percentage of sales under brand names owned and promoted by the  Cooperative
amount  to  approximately  59  percent;  sales  to the  food  service/industrial
represent  approximately 25 percent; and private label sales currently represent
approximately 16 percent.

It is difficult to estimate the number of  competitors  in the markets served by
the  Cooperative.  Nearly all products sold by the Cooperative  compete with the
nationally  advertised  brands of leading food processors,  including Del Monte,
Green Giant, Heinz,  Frito-Lay,  and Kraft, and similar major brands, as well as
with the branded and private label products of a number of regional  processors,
many of which  operate  only in  portions  of the  marketing  area served by the
Cooperative.
<PAGE>
                            MARKET AND INDUSTRY DATA

Unless  otherwise  stated in this  report,  industry  and market share data used
throughout  this Form 10-K was derived  from  industry  sources  believed by the
Cooperative to be reliable.  Such data was obtained or derived from consultants'
reports  and   industry   publications.   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  Cooperative has not
independently verified such industry, market share, and brand awareness data and
makes no representation to its accuracy.

                    NEW PRODUCTS AND RESEARCH AND DEVELOPMENT

Agrilink Foods operates a technical center located in Green Bay,  Wisconsin that
is responsible for new product development,  quality assurance, and engineering.
Approximately  25 employees are employed  within this  facility.  Agrilink Foods
follows a  four-stage  new product  development  process as follows:  screening,
feasibility,  development,  and commercialization.  This new product development
process ensures input from consumers,  customers,  and internal functional areas
before a new product is brought to market.

The  Cooperative  also  focuses  on  the  development  of  related  products  or
modifications of existing products for the  Cooperative's  brands and customized
products for the Cooperative's private label and food service businesses.

The amount expensed during the last three fiscal years on  Cooperative-sponsored
and  customer-sponsored  research  activities relating to the development of new
products or the improvement of existing products has not been material.

During fiscal 1999,  Birds Eye's Voila!,  a frozen  all-in-one meal product that
includes vegetables, pasta, seasonings, and bite sized pieces of grilled chicken
breast in a variety of flavors was  introduced.  Fiscal 2000 net sales for Birds
Eye Voila! were  approximately  $102.5 million.  Fiscal 1999 net sales for Birds
Eye Voila!  were $74.8 million which reflects nine months of activity due to the
date of the DFVC Acquisition.

                                    EMPLOYEES

As of June 24, 2000, the  Cooperative  had 5,781  full-time  employees,  of whom
4,106 were  engaged in  production  and the  balance  in  management,  sales and
administration.  As of that date, the  Cooperative  also employed  approximately
2,914 seasonal and other part-time employees, almost all of whom were engaged in
production.  Most of the  production  employees  are  members of  various  labor
unions. The Cooperative  believes its current relationship with its employees is
good.

ITEM 2.       DESCRIPTION OF PROPERTIES

All  plants,  warehouses,   office  space  and  other  facilities  used  by  the
Cooperative in its business are either owned by Agrilink Foods,  AgriFrozen,  or
leased from unaffiliated third parties.  All of the properties owned by Agrilink
Foods and  AgriFrozen  are  subject to  mortgages  in favor of their  respective
primary lender. In general,  the properties  include offices,  processing plants
and warehouse space.  Some processing plants are located in rural areas that are
convenient  for the  delivery  of  crops.  The  Cooperative  also has  dispersed
warehouse  locations  to  facilitate  the  distribution  of  finished  products.
Agrilink  Foods  and  AgriFrozen  believe  that  their  facilities  are in  good
condition and suitable for operations.

Agrilink Foods' Alton, New York property is held for sale.

The following  table  describes all material  facilities  leased or owned by the
Cooperative  (other than the properties held for sale, certain public warehouses
leased by the Cooperative from unaffiliated third parties from time to time, and
facilities  owned by Agrilink  Foods' joint venture,  Great Lakes Kraut Company,
LLC).  Except as otherwise noted,  each facility set forth below is owned by the
Cooperative.
<TABLE>
                     FACILITIES UTILIZED BY THE COOPERATIVE

Type of Property (By Product Line)                                         Location                         Square Feet
----------------------------------                                         --------                         -----------
<S>                                                                        <C>                                <C>
Vegetables:

Warehouse                                                                  Sodus, MI                          243,138
Warehouse and office, public storage facility (1)                          Vineland, NJ                       191,710
Freezing plant, warehouse, office and dry storage                          Barker, NY                         123,600
Freezing plant                                                             Bergen, NY                         138,554
Cold storage and repack facility and public storage warehouse              Brockport, NY                      429,052
Canning plant and warehouse, freezing plant                                Oakfield, NY                       263,410
Office, freezing plant, cold storage and repackaging facility              Montezuma, GA                      591,300
Office, freezing plant and cold storage                                    Alamo, TX                          114,446
Office, freezing plant and cold storage                                    Bridgeville, DE                    104,383
</TABLE>
<PAGE>
<TABLE>
                     FACILITIES UTILIZED BY THE COOPERATIVE

Type of Property (By Product Line)                                         Location                         Square Feet
----------------------------------                                         --------                         -----------
<S>                                                                        <C>                                <C>
Vegetables (Continued):

Freezing plant and repack plant                                            Celaya, Mexico                     318,620
Freezing plant and distribution center                                     Darien, WI                         348,800
Freezing plant, repack and warehouse                                       Fairwater, WI                      178,298
Repack plant and distribution center                                       Fulton, NY                         263,268
Canning and freezing plant and office                                      Green Bay, WI                      492,446
Canning plant and warehouse                                                Hortonville, WI                     78,000
Freezing plant and repack plant(1)                                         Oxnard, CA                          39,082
Repack plant (1)                                                           San Antonio, TX                     20,445
Freezing plant, warehouse, and office                                      Uvalde, TX                         146,625
Freezing plant, repack and warehouse                                       Watsonville, CA                    207,600
Freezing plant, repack and warehouse                                       Waseca, MN                         258,475
Labeling plant and distribution center (1)                                 Fond du Lac, WI                    330,000
Freezing plant and warehouse                                               Salem, OR                          110,000
Frozen repacking facility, warehouse, and distribution center (1)          Woodburn, OR                       385,000
Office building                                                            Salem, OR                            8,981
Freezing plant, warehouse, and office                                      Walla Walla, WA                    102,000
Freezing and repackaging plant (1)                                         Grandview, WA                       62,069
Receiving and grading station (1)                                          Cornelius, OR                       11,700
Receiving and grading station (1)                                          Mount Vernon, WA                   110,806
Receiving and grading station (1)                                          Aurora, WA                           6,800
Office building, warehouse and tank farm                                   Enumclaw, WA                        87,313
Freezing and repackaging plant, office and dry storage                     Woodburn, OR                       388,000
Plant, warehouse, and tank yards                                           Tacoma, WA                         295,468

Fruits:

Canning plant and warehouse                                                Red Creek, NY                      153,076
Manufacturing plant and warehouse                                          Fennville, MI                      350,000
Canning plant and warehouse                                                Lawton, MI                         142,000

Snacks:

Manufacturing plant                                                        Ridgway IL                          50,000
Distribution and warehouse                                                 North Bend, NE                      50,000
Office, plant and warehouse                                                Berlin, PA                         190,225
Administrative, plant, warehouse and distribution center (1)               Auburn, WA                          34,000
Plant, warehouse and distribution center                                   Auburn, WA                          37,442
Office, plant and warehouse                                                Cincinnati, OH                     113,576
Distribution center                                                        Elwood City, PA                      8,000
Distribution center                                                        Monessen, PA                        10,000
Distribution center                                                        Coraopolis, PA                      15,000
Distribution center                                                        Canton, OH                           8,200

Canned Meals:

Canning plant, warehouse, and distribution center                          Tacoma, WA                         313,488

Other:

Office building, manufacturing plant and warehouse                         Tacoma, WA                         372,164
Parking lot and yards (1)                                                  Tacoma, WA                         305,470
Office Building - Fuller Building (1)                                      Tacoma, WA                          60,000
Headquarters office (1)                                                    Rochester, NY                       76,372

<FN>
(1)Leased from third parties although certain related  equipment is owned by the
Cooperative.
</FN>
</TABLE>

ITEM 3.       LEGAL PROCEEDINGS

The  Cooperative is party to legal  proceedings  from time to time in the normal
course of its business.  In the opinion of management,  any liability that might
be incurred upon the resolution of these proceedings will not, in the aggregate,
have a  material  adverse  effect  on  either  of  these  businesses,  financial
condition, and results of operations.  Further, no such proceedings are known to
be contemplated by governmental  authorities.  The Cooperative maintains general
liability insurance coverage in amounts deemed to be adequate by management.

ITEM 4.       SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

Not applicable.


<PAGE>

                                     PART II

ITEM 5.    MARKET FOR REGISTRANT'S COMMON STOCK AND RELATED STOCK HOLDER MATTERS

There  is  no  trading  market  for  the   Cooperative's   common  stock.   Only
member/growers of the Cooperative can own shares of common stock. As of June 24,
2000, there were 626 members of Pro-Fac holding shares of Pro-Fac Class A Common
Stock and 150 members  holding shares of Pro-Fac Class B Common Stock. In fiscal
2000 and  1999,  dividends  on Class A Common  Stock  were paid at a rate of 5.0
percent.

The  information  required by this item is  contained in NOTE 9 to the "Notes to
Consolidated  Financial  Statements,"  at  "Quarterly  Financial  Data,"  and at
"Selected Financial Data."

During  fiscal 2000,  the  Cooperative  issued  shares of its Class A Cumulative
Preferred Stock in exchange for shares for its  Non-cumulative  Preferred Stock,
on a share-for-share  basis.  Such exchanges are exempt from registration  under
section  3(a)(9) of the  Securities  Act of 1933.  The dates and  amounts of the
exchanges are set forth below:

       Date                      Number of Shares         Value of Shares

 January 8, 2000                       2,106                  $  52,650
 April 8, 2000                         1,297                     32,425
 June 23, 2000                         1,832                     45,800
                                     -------                  ---------
   Total                               5,235                  $ 130,875
                                     =======                  =========

The  New  Credit   Facility   restricts   the  amount  of  dividends  and  other
distributions  that may be made by  Pro-Fac to its  stockholders.  The New Notes
restrict the amount of dividends and other payments that may be made by Agrilink
Foods. See further discussion at "Liquidity and Capital Resources."

The AgriFrozen  CoBank Credit Facility and CoBank  Subordinated  Promissory Note
restrict the amount of  dividends  and other  distributions  that may be made by
AgriFrozen on Class B common stock.

In addition,  New York  Cooperative Law restricts the amount of annual dividends
on common stock to 12 percent per annum.


<PAGE>


<TABLE>
ITEM 6.       SELECTED FINANCIAL DATA

(Dollars in Thousands, Except Capital Stock Data)
<CAPTION>

                                                                                     Fiscal Year Ended June
                                                                  ---------------------------------------------------------------
                                                                      2000          1999        1998            1997         1996
                                                                  -----------    ----------  -----------    ----------   ----------
<S>                                                               <C>            <C>          <C>           <C>          <C>
Consolidated summary of operations:
Net sales                                                         $1,268,542     $1,238,946   $  719,665    $  730,823   $  739,094
Cost of sales                                                       (882,861)      (877,438)    (524,082)     (539,081)    (562,926)
                                                                  ----------     ---------    ----------    ----------   ----------
Gross profit                                                         385,681        361,508      195,583       191,742      176,168
Selling, administrative, and general expenses                       (286,562)      (291,395)    (141,739)     (145,214)    (150,901)
Gains on sales of assets                                               6,635         64,734            0         3,565            0
Restructuring                                                              0         (5,000)           0             0       (5,871)
Income from joint venture                                              2,418          2,787        1,893             0            0
                                                                  ----------     ----------   ----------    ----------   ----------
Operating income                                                     108,172        132,634       55,737        50,093       19,396
Interest expense                                                     (83,511)       (67,420)     (30,767)      (36,473)     (41,998)
Amortization of debt issue costs                                           0         (5,500)           0             0            0
                                                                  ----------     ----------   ----------    ----------   ----------
Pretax income/(loss) before extraordinary item, cumulative
  effect of an accounting change, dividends, and allocation of
  net proceeds                                                        24,661         59,714       24,970        13,620      (22,602)
Tax (provision)/benefit                                               (8,497)       (24,746)      (7,840)       (5,529)      13,071
                                                                  ----------     ----------   ----------    ----------   ----------
Income/(loss) before extraordinary item, cumulative effect of an
  accounting change, dividends and allocation of net proceeds         16,164         34,968       17,130         8,091       (9,531)
Extraordinary item relating to the early extinguishment of debt
  (net of income taxes)                                                    0        (18,024)           0             0
Cumulative effect of an accounting change (net of income taxes)            0              0            0         4,606            0
                                                                  ----------     ----------   ----------     ---------   ----------
Net income/(loss)                                                 $   16,164     $   16,944   $   17,130     $  12,697   $   (9,531)
                                                                  ==========     ==========   ==========     =========   ==========
Allocation of Net Proceeds:
--------------------------
   Net income/(loss)                                              $   16,164     $   16,944   $   17,130     $  12,697   $   (9,531)
   Dividends on Class A common and preferred stock                    (7,410)        (6,734)      (6,328)       (5,503)      (8,993)
                                                                  ----------     ----------   ----------     ---------   ----------
   Net proceeds/(deficit)                                              8,754         10,210       10,802         7,194      (18,524)
   Allocation (to)/from earned surplus                                (3,832)       (10,210)      (4,662)       (3,661)      18,524
                                                                  ----------     ----------   ----------     ---------   ----------
   Net proceeds available to Class A members                      $    4,922     $        0   $    6,140     $   3,533   $        0
                                                                  ==========     ==========   ==========     =========   ==========
Allocation of net proceeds available to Class A members:
-------------------------------------------------------
   Payable to Class A members currently (30% of qualified
     proceeds available to Class A members in fiscal 2000 and
      25% in fiscal 1998 and 1997)                                $    1,477     $        0   $    1,535     $     883   $        0

Allocated to Class A members but retained by the Cooperative:
------------------------------------------------------------
   Qualified retains                                                   3,445              0        4,605         2,650            0
                                                                  ----------     ----------    ---------     ---------   ----------
   Net proceeds available to Class A members                      $    4,922     $        0    $   6,140     $   3,533   $        0
                                                                  ==========     ==========    =========     =========   ==========
   CMV related to Class A members                                 $   69,623     $   62,154    $  58,530     $  51,445   $   44,701
                                                                  ==========     ==========    =========    ==========   ==========
   CMV related to Class B members                                 $   14,060
                                                                  ==========
   Total net proceeds allocated to Class A members as a
     percent of CMV*                                                    7.07%          0.00%       10.51%         6.87%        0.00%
                                                                  ==========     ==========    =========    ==========   ==========

   Total net proceeds allocated to Class B members as a
     percent of CMV**                                                   0.00%          0.00%        0.00%         0.00%        0.00%
                                                                  ==========     ==========    =========    ==========   ==========
Balance Sheet Data:
------------------
   Working capital                                                $  260,481     $  237,331    $  94,103    $   75,950   $  103,361
   Ratio of current assets to current liabilities                      1.9:1          1.9:1        1.7:1         1.6:1        1.9:1
   Total assets                                                   $1,187,266     $1,196,479    $ 569,240    $  546,677   $  637,297
   Debt to equity ratio***                                             4.4:1          4.7:1        1.7:1         1.8:1        2.7:1
   Class A common stock                                           $   10,665     $    9,979    $   9,129    $    8,944   $    9,185
   Class B cumulative redeemable Preferred                        $      237     $      261    $     270    $      315   $      334
   Shareholders' and members' capitalization, redeemable stock,
     and common stock                                             $  159,843     $  152,111    $ 141,369    $  132,663   $  126,700

   Total long-term debt and senior subordinated notes (excludes
     current portion and capital leases)                          $  679,205     $  702,322    $ 229,937    $  229,829   $  327,683
Capital Stock Data
   Cash dividends paid per share:
     Class A Common                                               $      .25     $      .25    $     .25    $     0.00   $      .25
     Non-Cumulative Preferred                                     $     1.50     $     1.50    $    1.50    $     1.50   $     1.50
     Class A Cumulative Preferred                                 $     1.72     $     1.72    $    1.72    $     1.72   $     1.29
     Class B Cumulative Preferred                                 $     1.00     $     1.00    $    1.00    $     1.00   $     1.00
   Average Class A common stock investment per Class A member     $   17,037     $   15,471    $  14,399    $   14,333   $   14,419
Number of Class A Common Stock members:                                  626            645          634           624          637
Number of Class B Common Stock members:                                  150              0            0             0            0

<FN>
*    Payment to the members for CMV was 100 percent of deliveries in fiscal 1999
     and 90 percent of  deliveries in fiscal 1996.

**   Payment to the Class B members for CMV was 89.16 percent of deliveries in fiscal 2000.

***  For  purposes  of  this  calculation,   debt  includes  both  current  and
     non-current  debt, and equity  includes  common stock and  redeemable  preferred
     stock.
</FN>
</TABLE>


<PAGE>

ITEM 7.       MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
              AND RESULTS OF OPERATIONS

The purpose of this discussion is to outline the significant reasons for changes
in the  Consolidated  Statement of Operations  and Net Proceeds from fiscal 1998
through fiscal 2000.

Pro-Fac  Cooperative,  Inc.'s  ("Pro-Fac"  or  the  "Cooperative")  wholly-owned
subsidiary,  Agrilink Foods,  Inc.  ("Agrilink  Foods") has four primary product
lines including:  vegetables, fruits, snacks and canned meals. The Cooperative's
subsidiary,  AgriFrozen,  has  vegetables as its one primary  product line.  The
majority of each of the product  lines' net sales are within the United  States.
In  addition,  all of the  Cooperative's  operating  facilities,  excluding  one
facility in Mexico, are within the United States.

The  vegetable  product  line  consists of canned and frozen  vegetables,  chili
beans,  and  various  other  products.  Branded  products  within the  vegetable
category include Birds Eye, Birds Eye Voila!, Freshlike, Veg-All, McKenzies, and
Brooks Chili Beans.  The fruit product line consists of canned and frozen fruits
including  fruit  fillings  and  toppings.  Branded  products  within  the fruit
category  include  Comstock and  Wilderness.  The snack product line consists of
potato chips,  popcorn and other corn-based snack items. Branded products within
the snack category  include Tim's Cascade Chips,  Snyder of Berlin,  Husman,  La
Restaurante, Erin's, Beehive, Pops-Rite, Super Pop, and Flavor Destinations. The
canned meal product line includes  canned meat products such as chilies,  stews,
soups, and various other  ready-to-eat  prepared meals.  Branded products within
the canned meal category include Nalley.  The  Cooperative's  other product line
primarily  represents  salad  dressings.  Brand  products  within this  category
include Bernstein's, and Nalley.

The  following  tables  illustrate  the  Cooperative's  results of operations by
product line for the fiscal years ended June 24, 2000,  June 26, 1999,  and June
27, 1998, and the  Cooperative's  total assets by product line at June 24, 2000,
June 26, 1999, and June 27, 1998.

<TABLE>
EBITDA1,2

(Dollars in Millions)
<CAPTION>

                                                                               Fiscal Years Ended

                                                    June 24, 2000                 June 26, 1999                  June 27, 1998
                                               --------------------          ---------------------          --------------------
                                                              % of                           % of                          % of
                                                  $           Total              $           Total             $           Total
                                               -----          -----          ------          -----          ------         -----

<S>                                            <C>             <C>             <C>            <C>            <C>             <C>
Vegetables                                     101.6           71.1            67.2           62.7           20.3            26.3
Fruits                                          15.7           11.0            10.8           10.1           21.0            27.2
Snack                                            9.8            6.9             5.8            5.4            8.3            10.7
Canned meals                                     8.6            6.0             8.4            7.9            8.6            11.1
Other                                            6.5            4.5             5.3            4.9            1.8             2.3
                                               -----          -----          ------          -----          -----          ------
   Continuing segments                         142.2           99.5            97.5           91.0           60.0            77.6
Businesses sold3                                 0.7            0.5             9.6            9.0           17.3            22.4
                                               -----          -----          ------          -----          -----          ------
     Total                                     142.9          100.0           107.1          100.0           77.3           100.0
                                               =====          =====          ======          =====          =====           =====

<FN>
1  Earnings before interest, taxes, depreciation, and amortization ("EBITDA") is
   defined  as the sum of pretax  income  before  dividends,  allocation  of net
   proceeds,  extraordinary item,  interest expense,  amortization of debt issue
   costs associated with the Bridge  Facility,  depreciation and amortization of
   goodwill and other intangibles.

   EBITDA should not be considered as an alternative to net income or cash flows
   from operations or any other generally accepted accounting principles measure
   of performance or as a measure of liquidity.

   EBITDA is  included  herein  because  the  Cooperative  believes  EBITDA is a
   financial  indicator of a  Cooperative's  ability to service debt.  EBITDA as
   calculated  by the  Cooperative  may not be  comparable  to  calculations  as
   presented by other companies.

2  Excludes  the gains on sales of assets,  the  restructuring  charge,  and the
   extraordinary item relating to the early  extinguishment of debt. See NOTES 1
   and 3 to the "Notes to Consolidated Financial Statements."

3  Represents the operating results of operations sold.  See NOTE 3 to the "Notes to Consolidated Financial Statements."
</FN>
</TABLE>


<PAGE>



<TABLE>
Net Sales
(Dollars in Millions)

                                                                               Fiscal Years Ended
                                                    June 24, 2000                 June 26, 1999                  June 27, 1998
                                               --------------------          ---------------------          --------------------
                                                               % of                          % of                         % of
                                                   $           Total              $          Total            $          Total
                                                -------        -----           -------       -----          -----        -----

<S>                                               <C>           <C>              <C>          <C>           <C>           <C>
Vegetables                                        886.6         69.9             763.1        61.6          233.1         32.4
Fruits                                            110.4          8.7             111.5         9.0          119.7         16.6
Snack                                              87.3          6.9              87.9         7.1           83.7         11.6
Canned meals                                       60.3          4.7              64.2         5.2           64.0          8.9
Other                                              54.5          4.3              73.0         5.9           58.6          8.2
                                                -------       ------           -------       -----          -----        -----
     Continuing segments                        1,199.1         94.5           1,099.7        88.8          559.1         77.7
Businesses sold1                                   69.4          5.5             139.2        11.2          160.6         22.3
                                                -------       ------           -------       -----          -----        -----
     Total                                      1,268.5        100.0           1,238.9       100.0          719.7        100.0
                                                =======       ======           =======       =====          =====        =====

<FN>
1  Includes net sales of operations sold.  See NOTE 3 to the "Notes to Consolidated Financial Statements."
</FN>
</TABLE>
<TABLE>
Operating Income1
(Dollars in Millions)
<CAPTION>

                                                                               Fiscal Years Ended
                                                    June 24, 2000                 June 26, 1999                  June 27, 1998
                                               --------------------          ---------------------          ------------------
                                                              % of                           % of                          % of
                                                  $           Total              $           Total             $           Total
                                               -----          -----          ------          -----          ------         -----

<S>                                             <C>             <C>            <C>             <C>           <C>             <C>
Vegetables                                      70.8            69.8           46.0            63.0          11.5            20.6
Fruits                                          13.9            13.7            8.4            11.5          17.1            30.7
Snack                                            6.7             6.6            3.3             4.5           6.1            11.0
Canned meals                                     6.7             6.6            6.5             8.9           6.8            12.2
Other                                            4.6             4.5            3.7             5.1          (0.3)           (0.5)
                                               -----          ------         ------          ------         -----          ------
     Continuing segments                       102.7           101.2           67.9            93.0          41.2            74.0
Businesses sold2                                (1.2)           (1.2)           5.1             7.0          14.5            26.0
                                               -----          ------         ------          ------         -----          ------
     Total3                                    101.5           100.0           73.0           100.0          55.7           100.0
                                               =====          ======         ======           =====         =====           =====
<FN>

1   Excludes the gains on sales of assets,  the  restructuring  charge,  and the
    extraordinary item relating to the early extinguishment of debt. See NOTES 1
    and 3 to the "Notes to Consolidated Financial Statements."

2   Represents the operating results of the operations sold.  See NOTE 3 to the
    "Notes to Consolidated Financial Statements."

3   Operating income less interest  expense  (including the amortization of debt
    issue costs  associated  with the Bridge  Facility) of $83.5 million,  $72.9
    million, and $30.7 million for the years ended June 24, 2000, June 26, 1999,
    and  June  27,  1998,   respectively,   results  in  pretax   income  before
    extraordinary item,  dividends,  and allocation of net proceeds.  Management
    does not allocate  interest expense and corporate  overhead to product lines
    when evaluating product line performance.
</FN>
</TABLE>
<PAGE>
<TABLE>
Total Assets
(Dollars in Millions)
<CAPTION>
                                                                            As of Fiscal Years Ended
                                              ----------------------------------------------------------------------------------
                                                    June 24, 2000                 June 26, 1999                  June 27, 1998
                                               --------------------          ---------------------          ---------------------
                                                              % of                           % of                           % of
                                                   $          Total               $          Total             $            Total
                                               -------        -----            -------       -----          ------          -----

<S>                                              <C>           <C>               <C>          <C>           <C>              <C>
Vegetables                                       966.2         81.4              974.1        81.4          300.8            52.8
Fruits                                            79.4          6.7               90.2         7.5           87.5            15.4
Snacks                                            43.5          3.7               40.9         3.4            43.1            7.6
Canned Meals                                      45.7          3.8               46.2         3.9           49.8             8.7
Other                                             52.2          4.4               43.1         3.6           47.4             8.3
                                               -------        -----            -------       -----          -----           -----
   Continuing segments                         1,187.0        100.0            1,194.5        99.8          528.6            92.8
Businesses sold1                                   0.0          0.0                1.1         0.1           37.9             6.7
Assets held for sale                               0.3          0.0                0.9         0.1            2.7             0.5
                                               -------        -----            -------       -----          -----           -----
   Total                                       1,187.3        100.0            1,196.5       100.0          569.2           100.0
                                               =======        =====            =======       =====          =====           =====

<FN>
1  Includes the assets of operations sold.  See NOTE 3 to the "Notes to Consolidated Financial Statements."
</FN>
</TABLE>
                     CHANGES FROM FISCAL 1999 TO FISCAL 2000

Net income for fiscal 2000 of $16.2  million  represented  a $0.8 million or 4.7
percent decrease over fiscal 1999 net income of $17.0 million.  Comparability of
net income is, however,  difficult  because fiscal 1999 was impacted by gains on
sales of assets,  a restructuring  charge,  the amortization of debt issue costs
associated with the Subordinated  Bridge Facility,  and the  extraordinary  item
relating to the early  extinguishment of debt. In addition,  fiscal 2000 results
reflect 12 months of interest expense in the current year versus 9 months in the
prior year for the additional debt associated  with the DFVC  Acquisition  which
occurred on September 24, 1998 and additional  debt  associated with the Agripac
Acquisition  which  occurred  on  February  23,  1999.  Accordingly,  management
believes,  to  summarize  results,  an  evaluation  of  EBITDA  from  continuing
operations, as presented on page 14 in the EBITDA table included in this report,
is more  appropriate  because it allows the  business  to be  reviewed in a more
consistent manner.

While a further  description  of net sales and operating  income for each of its
product lines is outlined  below, in summary,  EBITDA from  continuing  segments
increased $44.7 million,  or 45.8 percent, to $142.2 million in fiscal 2000 from
$97.5 million in the prior fiscal year.

The vegetable  product line  accounts for $34.4 million  increase of the overall
EBITDA.  The  improvement  was  impacted by the date and the results of the DFVC
Acquisition, including its impact on the overall percentage of branded sales for
the Cooperative  and the reduction in product costs  resulting from  synergistic
savings. As a result of the date of the DFVC Acquisition,  the operating results
of the  acquisition  have been  included  for 12 months in fiscal 2000 and for 9
months in fiscal 1999. In addition, as anticipated at the DFVC Acquisition date,
a greater  percentage  of the  Cooperative's  sales  now come  from its  branded
products.  The  Cooperative's  branded  products  yield a higher margin than its
private label and food service  categories.  The  Cooperative has also benefited
from a reduction in product costs during fiscal 2000 primarily  associated  with
the  synergistic   savings   achieved  from  the  DFVC   Acquisition  and  other
consolidation  efforts.  Specifically,  the  Cooperative  has benefited from the
insourcing of product  previously  purchased  from outside  suppliers,  staffing
reductions,  and  shipping  consolidations.  Also,  as a result  of the  Agripac
Acquisition, the operating results of this acquisition have been included for 12
months in fiscal 2000 and 4 months in fiscal 1999.  Market conditions within the
frozen   vegetable   category   caused  by  lower  consumer  demand  and  retail
consolidation have, however,  offset the increases outlined above.  According to
industry data,  for the last 52-week period ended June 25, 2000,  there has been
an overall  decrease in the total  frozen  vegetable  category of 4.0 percent in
unit volume.  For the same 52-week  period ended June 25, 2000,  the decrease in
the total frozen  vegetable  private label category was 4.7 percent unit volume.
As  management  does  not  anticipate  an  improvement  in  the  current  market
conditions in the immediate future,  efforts will continue to be focused on cost
savings initiatives and innovative go-to-market strategies.

The fruit  category  showed an  increase of  approximately  $4.9  million.  This
improvement results from a return to historical pricing strategy and a reduction
in  promotional  spending in fiscal  2000.  Fiscal 1999  results  also  included
spending of $0.9 million for a new product  launch.  No such costs were incurred
in fiscal 2000.

Snacks showed an increase of $4.0 million due to changes in product mix.  During
fiscal 2000, a greater  percentage of sales were associated with the potato chip
category which carries a higher margin than the  Cooperative's  popcorn  product
line. In addition, fiscal
<PAGE>

1999 results were  impacted by a strike at the Snyder of Berlin  facility.  This
action resulted in incremental costs of approximately  $2.5 million in the prior
year.  The matter was settled in the first  quarter of fiscal  2000.  Management
believes its current relationship with these employees is good.

Canned  meals  showed  a  modest  increase  of $0.2  million  due  primarily  to
production  efficiencies  and a reduction in raw product  costs within the chili
category.

The other product line, which is primarily comprised of salad dressings,  showed
an  improvement  of $1.2 million due to changes in product mix and benefits from
reductions in raw product costs.

Net Sales:  Total net sales increased $29.6 million or 2.4 percent,  to $1,268.5
million  in  fiscal  2000  from  $1,238.9  million  in  fiscal  1999.  Excluding
businesses  sold,  net sales  increased by $99.4  million,  or 9.0  percent,  to
$1,199.1 million in fiscal 2000 from $1,099.7 million in fiscal 1999.

The increase in net sales from continuing  operations is primarily  attributable
to an  increase  of $123.5  million  within  the  vegetable  product  line.  The
inclusion of the Birds Eye,  Freshlike,  and Veg-All brands for 12 months during
fiscal 2000 versus nine months of results in fiscal 1999 resulted in incremental
sales of  approximately  $86.2 million.  In addition,  AgriFrozen  accounted for
additional  net sales of $57.7  million.  Excluding  this impact,  vegetable net
sales have declined  $20.4 million and, as  highlighted  above,  this decline is
primarily  attributable to lower consumer demand and retail consolidations which
occurred throughout the year.

Net sales for the fruit  product line  decreased  $1.1 million in fiscal 2000 to
$110.4  million  from  $111.5  million  in fiscal  1999.  While the pie  filling
category  exceeded  the  prior  year,  decreases  were  highlighted  within  its
applesauce category due to competitive pricing within the industry.

Net sales for snacks decreased by $0.6 million in fiscal 2000. Improvements were
highlighted in the potato chip category;  however,  these amounts were offset by
declines in popcorn due to both a decrease in volume and pricing.

Net sales for  canned  meals  declined  $3.9  million in fiscal  2000  primarily
attributable to a decline in sales volume in private label chili.

The other product line, while it primarily consists of dressings,  also includes
sales from the production of canned  products  primarily for use by the military
and other governmental operations. The majority of the $18.5 million decrease in
the other product line is associated  with the decline in government  demand for
these items.

Operating  Income:  Operating  income of $108.2 million in fiscal 2000 decreased
approximately  $24.4 million from $132.6  million in fiscal 1999.  Excluding the
impact of businesses  sold and other  non-recurring  items as identified on page
15, operating income from continuing  operations increased from $67.9 million in
fiscal 1999 to $102.7 million in fiscal 2000.  This represents an improvement of
$34.8 million or 51.3 percent.  As  highlighted in the discussion of EBITDA from
continuing  segments,  the increase is  attributable to the date of and benefits
from the DFVC Acquisition and other repositioning efforts.

Additionally,  while the Cooperative  experienced  significant benefits from its
efforts in fiscal 1999 to consolidate warehouses and other logistics operations,
the  decline  in sales  resulting  from the  current  industry  trend has caused
inventory  levels to increase.  Storage and handling costs  associated  with the
increase in inventory  approximated  $13 million in fiscal 2000.  Management has
taken significant steps to mitigate those costs for fiscal 2001 by both reducing
crop intake and adopting innovative go-to-market strategies.

Gains on Sales of Assets:  On June 23, 2000,  Agrilink sold its pickle  business
based in Tacoma,  Washington to Dean Pickle and Specialty Products Company. This
business included pickle,  pepper,  and relish products sold primarily under the
Nalley and Farman's brand names.  Agrilink  received  proceeds of  approximately
$10.3  million  which  were  applied to bank  loans  ($4.0  million of which was
applied to the Term Loan  Facility  and $6.3 million of which was applied to the
Agrilink Foods' Revolving Credit Facility). A gain of approximately $4.3 million
was recognized on this transaction.

On July 21, 2000,  Agrilink  Foods sold the machinery and equipment  utilized in
the  production  of  pickles  and other  related  products  to Dean  Pickle  and
Specialty  Products Company.  No significant gain or loss was recognized on this
transaction.  Proceeds of  approximately  $3.2  million were applied to the Term
Loan Facility.

This  transaction  did not include any other products  carrying the Nalley brand
name.  Agrilink Foods will continue to contract pack Nalley and Farman's  pickle
products for a period of two years at the existing Tacoma processing plant which
Agrilink Foods will operate.  Under a related  agreement,  the Cooperative  will
supply raw cucumbers grown in the Northwestern  United States to Dean Pickle and
Specialty Products Company, for a minimum 10-year period at market pricing.


<PAGE>



On December 17, 1999 Agrilink Foods announced they had completed the sale of the
Cambria,  Wisconsin  processing facility to Del Monte. The Cooperative  received
proceeds of approximately $10.5 million which were applied to bank loans. A gain
of  approximately  $2.3 million was  recognized  on this  transaction.  The sale
includes  an  agreement  for Del Monte to produce a portion of  Agrilink  Foods'
product needs during the 2000 packing season.

Restructuring: Implementation of a corporate-wide restructuring program resulted
in a charge of $5.0 million in the third  quarter of fiscal 1999.  See NOTE 1 to
the "Notes to Consolidated Financial Statements."

Income from Joint Venture:  This amount  represents  earnings  received from the
investment in Great Lakes Kraut  Company,  LLC, a joint venture  formed  between
Agrilink Foods and Flanagan Brothers, Inc. on July 1, 1997. The decrease of $0.4
million over the prior year is attributable  to the sale of assets.  See further
discussion at NOTE 3 to the "Notes to Consolidated Financial Statements."

Interest  Expense:  Interest expense increased $16.1 million to $83.5 million in
fiscal 2000 from $67.4  million in fiscal  1999.  The  increase in interest  is,
therefore,  associated  with  debt  utilized  to  finance  the DFVC and  Agripac
acquisitions and higher levels of seasonal borrowings to fund additional working
capital requirements  associated with the increase in the Cooperative's size. As
a result of the date of the DFVC Acquisition, interest expense has been included
for 12 months in fiscal  2000 and 9 months in fiscal  1999.  In  addition,  as a
result of the Agripac  acquisition,  interest  expense has been  included for 12
months  in  fiscal  2000 and 4 months  in fiscal  1999.  This  increase  is also
associated with an overall increase in prevailing  interest rates which occurred
over the last year.

Amortization of Debt Issue Costs Associated with the Bridge  Facility:  In order
to consummate the DFVC  Acquisition,  Agrilink Foods entered into a $200 million
bridge loan facility  (the "Bridge  Facility").  The Bridge  Facility was repaid
with the proceeds from the new senior  subordinated note offering (see NOTE 5 to
the "Notes to Consolidated  Financial  Statements" - "Debt - Senior Subordinated
Notes 11-7/8 Percent due 2008").  Debt issuance costs associated with the Bridge
Facility were $5.5 million and were fully amortized during the second quarter of
fiscal 1999.

Tax  Provision:  The tax  provision of $8.5 million in fiscal 2000  represents a
reduction of $16.2 million from the prior year. Of this decrease,  $25.2 million
is attributable to the provision associated with the fiscal 1999 gain on sale of
the aseptic  operations and the tax benefit of $2.1 million  associated with the
amortization  of debt issue costs also in fiscal 1999. In fiscal 2000,  the sale
of certain  intangibles in conjunction with the pickle sale negatively  impacted
the Cooperative's  effective tax rate. As previously outlined, the Cooperative's
effective  tax  rate  has   historically   been   negatively   impacted  by  the
non-deductibility  of certain amounts of goodwill.  The Cooperative's  effective
tax rate is also impacted by the net proceeds  distributed to members. A further
discussion  of tax matters is  included at NOTE 6 to the "Notes to  Consolidated
Financial Statements."

Extraordinary  Item Relating to the Early  Extinguishment of Debt:  Concurrently
with  the  DFVC  Acquisition,   Agrilink  Foods  refinanced  its  then  existing
indebtedness,  including its 12 1/4 percent Senior  Subordinated  Notes due 2005
and its then existing  bank debt.  Premiums and breakage  fees  associated  with
early  redemptions  and other fees  incurred  amounted to $18.0  million (net of
income taxes of $10.4 million).

                     CHANGES FROM FISCAL 1998 TO FISCAL 1999

The  Cooperative's  fiscal  1999  results  were  significantly  impacted  by two
acquisitions.  These include the acquisition of the Dean Foods Vegetable Company
("DFVC") and the acquisition of Agripac, Inc. ("Agripac").

On September  24, 1998,  Agrilink  Foods  acquired  DFVC,  the frozen and canned
vegetable  business of Dean Foods Company ("Dean  Foods"),  by acquiring all the
outstanding  capital  stock of Dean  Foods  Vegetable  Company  and Birds Eye de
Mexico  SA  de  CV  (the  "DFVC  Acquisition").  In  connection  with  the  DFVC
Acquisition,  Agrilink Foods sold its aseptic  business to Dean Foods.  Agrilink
Foods paid $360 million in cash,  net of the sale of the aseptic  business,  and
issued to Dean Foods a $30 million  unsecured  subordinated  promissory note due
November  22,  2008  (the  "Dean  Foods   Subordinated   Promissory  Note"),  as
consideration for the DFVC Acquisition.  After the Acquisition,  DFVC was merged
into  Agrilink  Foods.  This  entity has been one of the leading  processors  of
vegetables in the United  States,  selling its products under  well-known  brand
names, such as Birds Eye, Birds Eye Voila!,  Freshlike and Veg-All,  and various
private labels.

On February  23,  1999,  the  Cooperative,  through its  subsidiary  AgriFrozen,
acquired the frozen  vegetable  processing of Agripac.  The Cooperative owns 100
percent of the common stock of AgriFrozen;  and the Northwest Grows Cooperative,
Inc., an Oregon cooperative, owns all of AgriFrozen's preferred stock.

<PAGE>

The Cooperative  believes that these  acquisitions  strengthened its competitive
position by: (i)  enhancing  its brand  recognition  and market  position,  (ii)
providing  opportunities  for cost savings and operating  efficiencies and (iii)
increasing its product and geographic diversification.

Net income for fiscal 1999 of $17.0 million  represented a $0.1 million decrease
over fiscal 1998 net income of $17.1  million.  Comparability  of net income is,
however,  difficult  because fiscal 1999 was impacted by acquisitions,  gains on
sales of assets,  a restructuring  charge,  an increase in interest  expense and
depreciation  expense  associated with  acquisitions,  the  amortization of debt
issue  costs  associated  with  the  Subordinated   Bridge  Facility,   and  the
extraordinary item relating to the early extinguishment of debt.

Accordingly,  management  believes  that to summarize  results an  evaluation of
EBITDA from continuing  operations,  as presented on page 14 in the EBITDA table
included in this report,  is more appropriate  because it allows the business to
be reviewed in a more  consistent  manner.  While a further  description  of net
sales and operating  income for each of its product lines is outlined  below, in
summary, EBITDA from continuing operations increased a net $37.5 million or 62.5
percent, to $97.5 million in fiscal 1999 from $60.0 million in fiscal 1998.

The  vegetable  product line  accounts for $46.9  million of the overall  EBITDA
increase and is  primarily  attributable  to the DFVC and Agripac  acquisitions.
While this  product  line has  benefited  from the  inclusion  of the Birds Eye,
Freshlike,  and Veg-All  brands,  the category has been  negatively  impacted by
market  conditions  within the frozen private label segment as a result of lower
demand, industry oversupply, and subsequent declines in pricing.

The fruit  category  showed a decrease of  approximately  $10.2  million or 48.6
percent and was  primarily  due to a change in the Agrilink  Foods'  pricing and
promotional strategy within this product line.

Snacks were impacted by competitive  pricing within the popcorn  product line as
an increase in  production  from foreign  countries,  such as  Argentina,  which
reduced  selling  prices.  In addition,  the potato chip category was negatively
impacted by a strike at the Snyder of Berlin  facility during the spring of 1999
which resulted in additional costs of approximately $2.5 million.

Canned meals showed a modest decline due primarily to the  recognition in fiscal
1998 of a  favorable  settlement  of an  outstanding  tax claim  regarding  meat
products.

The other product  category showed an improvement due primarily to reductions in
costs and promotional spending.

Net Sales: Total net sales increased $519.2 million or 72.1 percent, to $1,238.9
million in fiscal 1999 from $719.7 million in fiscal 1998.  Excluding businesses
sold,  net sales  increased  by $540.6  million,  or 96.7  percent,  to $1,099.7
million in fiscal 1999 from $559.1 million in fiscal 1998.

The increase in net sales from continuing  operations is primarily  attributable
to an increase of $554.5 million and $28.4 million within the vegetable  product
line  as a  result  of the  DFVC  and  Agripac  acquisitions,  respectively.  In
addition,  during fiscal 1998, Agrilink Foods became the sole supplier of frozen
vegetables  for the Sam's  national club stores.  Full  distribution  under this
contract  was  achieved  in fiscal  1999.  These  improvements  were offset by a
decline in the frozen  private label  segment.  Beginning in January of 1999 and
continuing  through  fiscal 1999,  the frozen  private  label  frozen  vegetable
segment, as reported by several sources,  experienced a decline in unit sales of
between 7 and 10 percent.

Net sales for the fruit  product line  decreased  $8.2 million in fiscal 1999 to
$111.5  million from $119.7  million in fiscal 1998.  As a result of a change in
pricing and promotional  strategy,  Agrilink Foods  experienced a decline in its
branded  pie  filling  volume  and an  increase  in  its  private  label  volume
throughout  fiscal  1999.  Management  returned  to  its  historic  pricing  and
promotional  strategy in fiscal  2000,  and  improvements  in this  product line
occurred.

Net sales for snacks  increased  by $4.2  million in fiscal  1999 as a result of
unit volume primarily within the potato chip category.

All  "other"  product  categories  showed an  increase  of $14.4  million.  This
increase  is  attributable  to sales  from the  production  of  canned  products
primarily  for use by the  military  and  other  governmental  operations.  This
business was obtained through the DFVC acquisition and, thus, there were no such
sales in fiscal  1998.  This  increase  was offset by declines  within the salad
dressings category caused by competitive pressures.

Operating  Income:  Operating  income of $132.6 million in fiscal 1999 increased
approximately  $76.9  million from $55.7  million in fiscal 1998.  Excluding the
impact of  businesses  sold, as  identified  on page 15,  operating  income from
continuing  operations  increased  from $41.2  million  in fiscal  1998 to $67.9
million in fiscal 1999.  This represents an improvement of $26.7 million or 64.8
percent.


<PAGE>



Vegetables showed improvements of $34.5 million or 300.0 percent.  The vegetable
product lines obtained through the DFVC and Agripac  acquisitions  accounted for
$54.7 million and $2.1 million of this increase, respectively, while preexisting
vegetable  operations  showed  a  decline  of  $22.3  million.  The  preexisting
vegetable  operations  experienced  margin  erosion  resulting from the downward
trend in the  private  label  frozen  vegetable  market  highlighted  above.  In
addition, the reduction in the volume of frozen vegetable product repackaged and
sold resulted in a higher per unit cost.  Additionally,  incremental warehousing
costs  (storage,  handling,  and  shipping) of  approximately  $5.0 million were
incurred to  consolidate  the  operations of Agrilink  Foods'  frozen  vegetable
business as part of the DFVC Acquisition.

Fruits  showed a decline of $8.7 million or 50.9  percent from $17.1  million in
fiscal 1998 to $8.4 million in fiscal 1999. Pie filling  accounted for a decline
of $6.1 million due to the change in pricing and promotional  strategy discussed
above.  Applesauce  showed  declines  of $1.4  million due to the  reduction  in
pricing resulting from increased industry supply. The remaining decline resulted
from incremental costs associated with a new product launch in fiscal 1999.

Snacks  showed a decline of $2.8  million or 45.9  percent  from $6.1 million in
fiscal 1998 to $3.3  million in fiscal  1999.  The decline  resulted  from costs
associated  with the strike at the Snyder of Berlin  facility  of  approximately
$2.5 million and the competitive pressures within the popcorn category.

Canned meals showed a modest decline due primarily to the  recognition in fiscal
1998 of a  favorable  settlement  of an  outstanding  tax claim  regarding  meat
products.

The  other  product  category  showed an  improvement  due  primarily  to canned
products sold to the military as  highlighted  above and reductions in costs and
promotional spending.

Gains on Sales of Assets:  In conjunction  with the DFVC  Acquisition,  Agrilink
Foods sold its aseptic business to Dean Foods. The purchase price of $80 million
was based upon an appraisal completed by an independent  appraiser.  The gain on
the sale was approximately $61.2 million.

On January 29, 1999, Agrilink Foods sold the Adams brand peanut butter operation
to the J.M. Smucker Company.  Agrilink Foods received  proceeds of approximately
$13.5  million  which  were  applied  to  outstanding  bank  loans.  A  gain  of
approximately $3.5 million was recognized on this transaction.

Restructuring: Implementation of a corporate-wide restructuring program resulted
in a charge of $5.0 million in the third  quarter of fiscal 1999.  See NOTE 1 to
the "Notes to Consolidated Financial Statements."

Income from Joint Venture:  This amount  represents  earnings  received from the
investment in Great Lakes Kraut  Company,  LLC, a joint venture  formed  between
Agrilink Foods and Flanagan Brothers, Inc. on July 1, 1997. The increase of $0.9
million  over  the  prior  year is  attributable  to  increases  in  volume  and
improvements  in  pricing.  See  further  discussion  at NOTE 3 to the "Notes to
Consolidated Financial Statements."

Interest  Expense:  Interest expense increased $36.6 million to $67.4 million in
fiscal 1999 from $30.8 million in fiscal 1998.  This increase is associated with
debt utilized to finance the DFVC and Agripac  acquisitions and higher levels of
seasonal borrowings to fund changes in operating  activities due to the increase
in the Cooperative's size.

Amortization of Debt Issue Costs Associated with the Bridge  Facility:  In order
to consummate the DFVC  Acquisition,  Agrilink Foods entered into a $200 million
bridge loan facility  (the "Bridge  Facility").  The Bridge  Facility was repaid
with the proceeds  received from the new senior  subordinated note offering (see
NOTE 5 to the  "Notes to  Consolidated  Financial  Statements"  - "Debt - Senior
Subordinated  Notes 11-7/8 Percent due 2008").  Debt issuance  costs  associated
with the Bridge Facility were $5.5 million and were fully  amortized  during the
second quarter of fiscal 1999.

Tax Provision:  The provision for taxes increased $16.9 million to $24.7 million
in fiscal 1999 from $7.8 million in fiscal  1998.  Of this net  increase,  $25.2
million is attributable  to the provision  associated with the gains on sales of
assets.  This amount was offset by a $2.1 million tax benefit resulting from the
amortization  of debt  issue  costs  associated  with the Bridge  Facility.  The
remaining  variance  is  impacted  by the change in  earnings  before  tax.  The
Cooperative's  effective tax rate is impacted by the net proceeds distributed to
members and the  non-deductibility  of certain  amounts of goodwill  and certain
other intangible assets. A further discussion of tax matters is included at NOTE
6 to the "Notes to Consolidated Financial Statements."


<PAGE>


Extraordinary  Item Relating to the Early  Extinguishment of Debt:  Concurrently
with  the  DFVC  Acquisition,   Agrilink  Foods  refinanced  its  then  existing
indebtedness,  including its 12 1/4 percent Senior  Subordinated  Notes due 2005
and its then existing  bank debt.  Premiums and breakage  fees  associated  with
early  redemptions  and other fees  incurred  amounted to $18.0  million (net of
income taxes of $10.4 million).

                         LIQUIDITY AND CAPITAL RESOURCES

The following  discussion  highlights  the major  variances in the  Consolidated
Statement of Cash Flows for fiscal 2000 compared to fiscal 1999.

Net cash used in operating  activities of $8.4 million in fiscal 2000  decreased
$8.9  million  from the fiscal  1999  balance of $17.3  million.  This  decrease
primarily  results from variances within accounts payable and other accruals due
to the timing of liquidation of outstanding balances. This variance is offset by
an increase in inventories  due to the decline in net sales resulting from lower
consumer demand and retail consolidation.

Net cash used in investing activities was significantly impacted by the DFVC and
Agripac  acquisitions  in fiscal  1999.  The  purchase  of  property,  plant and
equipment  increased  $3.2  million to $27.0  million in fiscal  2000 from $23.8
million  in  fiscal  1999.  The  increase  was  primarily  utilized  to  support
additional  operating  facilities  acquired  in  conjunction  with  the DFVC and
Agripac acquisitions and was for general operating purposes.

Net cash used in financing  activities in fiscal 2000 was  primarily  associated
with mandatory  prepayments,  including proceeds from the disposition of assets.
The financing activities in fiscal 1999 were significantly  impacted by the DFVC
and Agripac  acquisitions  and the activities  completed  concurrently  with the
acquisition to refinance existing indebtedness.

AGRILINK FOODS DEBT

New Credit  Facility  (Bank  Debt):  In  connection  with the DFVC  Acquisition,
Agrilink  Foods  entered  into  the New  Credit  Facility  with  Harris  Bank as
Administrative Agent, the Bank of Montreal as Syndication Agent, and the lenders
thereunder.  The New Credit Facility consists of a $200 million Revolving Credit
Facility  and a $455  million  Term Loan  Facility.  The Term Loan  Facility  is
comprised of the Term A Facility, which has a maturity of five years, the Term B
Facility,  which has a maturity of six years, and the Term C Facility, which has
a maturity of seven years.  The Revolving Credit Facility has a maturity of five
years.  All previous bank debt was repaid in  conjunction  with the execution of
the New Credit Facility.

The New Credit  Facility  bears  interest,  at Agrilink  Foods'  option,  at the
Administrative  Agent's alternate base rate or the London Interbank Offered Rate
("LIBOR")  plus,  in  each  case,  applicable  margins  of:  (i) in the  case of
alternate base rate loans, (x) 1.00 percent for loans under the Revolving Credit
Facility  and the Term A Facility,  (y) 2.75  percent for loans under the Term B
Facility  and (z) 3.00  percent for loans under the Term C Facility  and (ii) in
the case of LIBOR loans,  (x) 2.75 percent for loans under the Revolving  Credit
Facility  and the Term A Facility,  (y) 3.75  percent for loans under the Term B
Facility  and (z)  4.00  percent  for  loans  under  the  Term C  Facility.  The
Administrative  Agent's  "alternate base rate" is defined as the greater of: (i)
the prime commercial rate as announced by the  Administrative  Agent or (ii) the
Federal Funds rate plus 0.50 percent. The fiscal 2000 weighted-average  interest
rate of interest  applicable  to the Term Loan  Facility  was 9.51  percent.  In
addition,  Agrilink  Foods pays a commitment  fee  calculated  at a rate of 0.50
percent per annum on the daily  average  unused  commitment  under the Revolving
Credit Facility.

Upon  consummation  of the DFVC  Acquisition,  Agrilink  Foods drew $455 million
under the Term Loan Facility,  consisting of $100 million, $175 million and $180
million of loans under the Term A Facility, Term B Facility and Term C Facility,
respectively.  Additionally, Agrilink Foods drew $93 million under the Revolving
Credit  Facility for seasonal  working capital needs and $14.3 million under the
Revolving  Credit  Facility  was issued for letters of credit.  During  December
1998,  Agrilink  Foods' primary lender  exercised its right under the New Credit
Facility to transfer $50 million from the Term A Facility to the Term B and Term
C Facilities in increments of $25 million.


<PAGE>


Utilizing  outstanding  balances  at June 24,  2000,  the Term Loan  Facility is
subject to the following amortization schedule:

(Dollars in Millions)

Fiscal Year    Term Loan A        Term Loan B         Term Loan C        Total
-----------    -----------        -----------         -----------        -----
                               (Dollars in millions)

    2001         $  10.0             $  0.4              $   0.4        $  10.8
    2002            10.0                0.4                  0.4           10.8
    2003            10.0                0.4                  0.4           10.8
    2004             9.2                0.4                  0.4           10.0
    2005             0.0              190.5                  0.4          190.9
    2006             0.0                0.0                195.0          195.0
                 -------             ------              -------        -------
                 $  39.2             $192.1              $197.0         $ 428.3
                 =======             ======              ======         =======

The Term  Loan  Facility  is  subject  to  mandatory  prepayment  under  various
scenarios as defined in the New Credit  Facility.  During fiscal 2000,  Agrilink
Foods made  mandatory  prepayments of $10.0 million from proceeds of the sale of
the Cambria facility and the pickle operations. In addition, scheduled principal
payments of $8.3 million  were made on the Term Loan  facilities  during  fiscal
2000.

Agrilink Foods'  obligations under the New 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 certain of Pro-Fac's
current  and  future  subsidiaries  (excluding  AgriFrozen),  and  (iii)  all of
Agrilink  Foods'  rights  under  the  agreement  to  acquire  DFVC  (principally
indemnification  rights) and the Marketing and  Facilitation  Agreement  between
Agrilink Foods and Pro-Fac.  Agrilink  Foods'  obligations  under the New Credit
Facility  are  guaranteed  by  Pro-Fac  (excluding  AgriFrozen)  and  certain of
Agrilink Foods' subsidiaries.

The New  Credit  Facility  contains  customary  covenants  and  restrictions  on
Agrilink  Foods'  ability to engage in certain  activities,  including,  but not
limited to: (i)  limitations on the incurrence of indebtedness  and liens,  (ii)
limitations on sale-leaseback  transactions,  consolidations,  mergers,  sale of
assets,  transactions  with affiliates and investments and (iii)  limitations on
dividend  and  other  distributions.  The  New  Credit  Facility  also  contains
financial   covenants   requiring   Pro-Fac  to  maintain  a  minimum  level  of
consolidated EBITDA, a minimum  consolidated  interest coverage ratio, a minimum
consolidated fixed charge coverage ratio, a maximum consolidated  leverage ratio
and a minimum level of consolidated  net worth.  Under the New Credit  Facility,
the  assets,  liabilities,  and  results of  operations  of  AgriFrozen  are not
consolidated  with  Pro-Fac for  purposes  of  determining  compliance  with the
covenants.  In August of 1999,  Agrilink  Foods  negotiated  an amendment to the
original  covenants.  In conjunction with these  amendments,  Agrilink Foods has
incurred fees of  approximately  $2.6 million.  This is being amortized over the
remaining  life of the New Credit  Facility.  Pro-Fac and Agrilink  Foods are in
compliance with all covenants,  restrictions and requirements under the terms of
the New Credit Facility as amended.

Senior  Subordinated  Notes - 11 7/8  Percent  (due  2008):  To  extinguish  the
Subordinated  Bridge Facility used to consummate the DFVC Acquisition,  Agrilink
Foods issued Senior  Subordinated Notes ("New Notes") for $200 million aggregate
principal amount due November 1, 2008.  Interest on the New 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 New  Notes  represent  general  unsecured  obligations  of  Agrilink  Foods,
subordinated  in right of payment to certain other debt  obligations of Agrilink
Foods (including Agrilink Foods' obligations under the New Credit Facility). The
New Notes are guaranteed by Pro-Fac and certain of Agrilink Foods' subsidiaries.

The New Notes contain  customary  covenants and  restrictions on Agrilink Foods'
ability to engage in certain  activities,  including,  but not  limited  to: (i)
limitations on the incurrence of  indebtedness  and liens;  (ii)  limitations on
consolidations,  mergers,  sales of assets,  transactions  with affiliates;  and
(iii)  limitations  on dividends and other  distributions.  Agrilink Foods is in
compliance  with all covenants,  restrictions,  and  requirements  under the New
Notes.

Subordinated Bridge Facility:  To complete the DFVC Acquisition,  Agrilink Foods
entered into a  Subordinated  Bridge  Facility (the "Bridge  Facility").  During
November  1998,  the net proceeds from the sale of the New Notes,  together with
borrowings  under  the  Revolving  Credit  Facility,  were used to repay all the
indebtedness  outstanding  ($200 million plus accrued interest) under the Bridge
Facility.  The  outstanding  indebtedness  under  the  Bridge  Facility  accrued
interest at an approximate rate per annum of 10 1/2 percent. Debt issuance costs
associated with the Bridge Facility of $5.5 million were fully amortized  during
the second quarter of fiscal 1999.


<PAGE>


Dean Foods Subordinated  Promissory Note: As partial  consideration for the DFVC
Acquisition,  Agrilink  Foods  issued to Dean Foods the Dean Foods  Subordinated
Promissory  Note for $30 million  aggregate  principal  amount due  November 22,
2008.  Interest on the note is accrued quarterly in arrears commencing  December
31, 1998,  at a rate per annum of 5 percent  until  November 22, 2003,  and at a
rate of 10 percent thereafter.  As the stated rates on the note are below market
value,  Agrilink  Foods  has  imputed  the  appropriate  discount  utilizing  an
effective  interest rate of 11-7/8 percent.  Interest  accruing through November
22, 2003 is required to be paid in kind through the  issuance by Agrilink  Foods
of additional  subordinated  promissory  notes  identical to the note.  Agrilink
Foods  satisfied  this  requirement  through  the  issuance  of  six  additional
promissory notes each for  approximately  $0.4 million.  Interest accruing after
November  22,  2003 is  payable in cash.  The notes may be  prepaid at  Agrilink
Foods' option without premium or penalty.

The note is expressly  subordinate to the New Credit  Facility and the New Notes
and contains no financial covenants. The note is guaranteed by Pro-Fac.

Senior  Subordinated  Notes  -  12  1/4  Percent  Due  2005  ("Old  Notes"):  In
conjunction with the DFVC Acquisition,  Agrilink Foods repurchased  $159,985,000
principal  amount of its Old Notes,  of which $160 million  aggregate  principal
amount was previously outstanding.  Agrilink Foods paid a total of approximately
$184 million to repurchase the Old Notes,  including interest accrued thereon of
$2.9  million.  Holders who  tendered  consented  to certain  amendments  to the
indenture relating to the Old Notes,  which eliminated or amended  substantially
all the  restrictive  covenants and certain events of default  contained in such
indenture.  Agrilink  Foods may repurchase the remaining Old Notes in the future
in open market transactions, privately negotiated purchases or otherwise.

AGRIFROZEN DEBT

CoBank  Credit  Facility(Bank  Debt):  In  connection  with the  acquisition  of
Agripac's  frozen vegetable  processing  business,  AgriFrozen  entered a credit
facility with CoBank.  The CoBank Credit Facility consists of a $30 million Term
Loan Facility and a Revolving  Credit  Facility both of which mature on June 29,
2002.  The  Revolving  Credit  Facility  is $55  million for fiscal 2000 and $50
million in each year thereafter.

The CoBank Term Loan Facility bears interest, at AgriFrozen's option, at a fixed
or variable rate.  The fixed rate  represents the CoBank cost of funds plus 4.19
percent. The variable rate represents the CoBank "National Variable Rate," which
is a reference rate established by CoBank. In addition,  AgriFrozen is obligated
to pay a commitment  fee  calculated  at a rate of 0.50 percent per annum on the
amount by which the CoBank  Revolving  Credit  Facility  commitment  exceeds the
greater of (i) $50  million or (ii) the average  daily  aggregate  of  advances.
There is an interest cap, which includes the fees on the CoBank Revolving Credit
Facility.  The interest rate cap was $1.9 million for the initial  period ending
June 26, 1999 and is $5.5 million for each subsequent fiscal year.

AgriFrozen's  obligations under the CoBank Credit Facility are collateralized by
a first-priority  lien on  substantially  all existing or after acquired assets,
tangible or intangible, of AgriFrozen.

AgriFrozen's  obligations under the CoBank Credit Facility are not guaranteed by
Pro-Fac or  Agrilink  Foods and are  expressly  nonrecourse  as to  Pro-Fac  and
Agrilink Foods.

The CoBank Credit  Facility  contains  customary  covenants and  restrictions on
AgriFrozen's ability to engage in certain activities, including, but not limited
to:  (i)  limitations  on  the  incurrence  of  indebtedness  and  liens,   (ii)
limitations  on  consolidations,  mergers,  sale  of  assets,  acquisitions  and
transactions  with  affiliates and third parties (iii)  limitations on dividends
and  other  distributions  and (iv)  limitations  on  capital  expenditures  and
administrative  expenses.  The CoBank Credit  Facility  also contains  financial
covenants  that are effective  beginning in fiscal 2000.  The covenants  require
AgriFrozen to maintain a minimum level of EBITDA and a maximum  leverage  ratio.
AgriFrozen  is in  compliance  with or has obtained  waivers for its  covenants,
restrictions, and requirements under the terms of the CoBank Credit Facility.

CoBank   Subordinated   Promissory  Note:  As  partial   consideration  for  the
acquisition of Agripac's frozen vegetable processing business, AgriFrozen issued
to CoBank the CoBank  Subordinated  Promissory  Note for $12  million  aggregate
principal  amount.  Interest  on  the  note  is  payable  quarterly  in  arrears
commencing  February 22, 2004 through February 22, 2009 at a rate per annum of 5
percent, and at a rate of 7 percent thereafter.  As the stated rates on the note
are  below  market  value,  AgriFrozen  has  imputed  the  appropriate  discount
utilizing an effective  interest rate of 13 percent.  Interest  accruing for the
period from  February  22,  2004  through  February  22, 2009 is payable in kind
through the issuance by AgriFrozen of additional  subordinated  promissory notes
identical to the note. Quarterly principal payments are due commencing March 31,
2009 each equal to 1/40 of the principal  balance on March 31, 2009 with a final
lump-sum  payment due February 22, 2014. The note may be prepaid at AgriFrozen's
option without premium or penalty.


<PAGE>


The note is expressly  subordinate  to the CoBank Credit  Facility.  The note is
collateralized by the assets of AgriFrozen,  but it is not guaranteed by Pro-Fac
or Agrilink  Foods and is  expressly  non-recourse  as to Pro-Fac  and  Agrilink
Foods.

Capital  Expenditures:  Agrilink Foods anticipates that capital expenditures for
fiscal  years  2001  and 2002  will be  approximately  $25  million  per  annum.
AgriFrozen  anticipates that capital expenditures for fiscal years 2001 and 2002
will be approximately $3.0 million per annum. Both Agrilink Foods and AgriFrozen
believe that cash flow from  operations  and borrowings  under their  respective
bank  facilities  will  be  sufficient  to  meet  their   respective   liquidity
requirements for the foreseeable future.

Short- and Long-Term  Trends:  Throughout  fiscal 2000 and 1999, the Cooperative
has focused on its core businesses and growth opportunities. During fiscal 1999,
Agrilink Foods acquired the frozen and canned vegetable  business of Dean Foods.
On February 23, 1999, the Cooperative along with Northwest Growers  Cooperative,
Inc., an Oregon cooperative,  purchased the Agripac frozen vegetable  processing
business. The Cooperative believes that these acquisitions have strengthened its
competitive  position  by:  (i)  enhancing  its  brand  recognition  and  market
position,   (ii)  providing   opportunities   for  cost  savings  and  operating
efficiencies and (iii) increasing its product and geographic diversification.

A complete  description of the acquisition and disposal activities  completed is
outlined at NOTE 3 to the "Notes to Consolidated Financial Statements."

The vegetable and fruit portions of the business can be positively or negatively
affected  by weather  conditions  nationally  and the  resulting  impact on crop
yields.  Favorable  weather  conditions  can  produce  high crop  yields  and an
oversupply  situation.  This  results in  depressed  selling  prices and reduced
profitability on the inventory  produced from that year's crops.  Excessive rain
or drought conditions can produce low crop yields and a shortage situation. This
typically  results in higher selling prices and increased  profitability.  While
the  national  supply  situation  controls  the  pricing,  the supply can differ
regionally because of variations in weather.

Management  believes  that a decrease  in  consumer  demand has  resulted  in an
increased  supply of  vegetables  throughout  the  industry.  Accordingly,  this
increase in supply,  along with the decline of 4.7 percent in unit volume within
the  private  label  frozen  vegetable  category  has  negatively  impacted  the
Cooperative's  margin in the  third  and  fourth  quarters  of  fiscal  2000 and
continues to date.

Supplemental  Information  on Inflation:  The changes in costs and prices within
the  Cooperative's  business due to inflation were not  significantly  different
from  inflation  in the  United  States  economy  as a whole.  Levels of capital
investment,  pricing and inventory  investment  were not materially  affected by
changes caused by inflation.

OTHER MATTERS

Recently Issued  Accounting  Statements:  In June 1998, the FASB issued SFAS No.
133, Accounting for Derivative Instruments and Hedging Activities. In June 1999,
the FASB issued SFAS 137,  which  deferred the effective date of SFAS No. 133 to
fiscal years  beginning  after June 15, 2000,  and requires all  derivatives  be
measured at fair value and recorded on a company's  balance sheet as an asset or
liability,  depending  upon  the  company's  underlying  rights  or  obligations
associated  with the  derivative  instrument.  Agrilink Foods and AgriFrozen are
currently investigating the impact of this pronouncement.

Year  2000  Readiness  Disclosure:  The  Cooperative  has  not  experienced  any
significant  Year 2000 related system failures nor, to  management's  knowledge,
have any of Pro-Fac's suppliers.  The Cooperative intends to continue to monitor
and test systems for ongoing Year 2000 compliance;  however,  management  cannot
guarantee that the systems of other  companies upon which  operations rely could
not be affected by issues associated with the Year 2000 conversion.

All material costs associated with Agrilink Foods' Year 2000 compliance  project
were covered under its service  agreement  with Systems and Computer  Technology
Corporation  ("SCT").  Agrilink Foods' ten-year  agreement with SCT is currently
valued  at $50  million  and is for SCT's  OnSite  outsourcing  services,  which
includes  assistance  in solving the Year 2000 issue.  These  amounts  have been
funded through operating cash flows.

Prior to  AgriFrozen's  acquisition  of Agripac's  frozen  vegetable  processing
business, the Cooperative conducted an analysis of Agripac's associated computer
hardware and software systems.  Based on this analysis,  AgriFrozen replaced its
computer  hardware with year 2000 ready hardware and has entered into a sublease
with  Agrilink  Foods  pursuant to which it licenses  Agrilink  Foods'  software
systems. Costs of $0.7 million associated with AgriFrozen's Year 2000 compliance
project were primarily  covered under its service agreement with EDS or internal
resources.  These amounts have been funded through  AgriFrozen's  operating cash
flows.


<PAGE>


ITEM 7A.      QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Interest Rate Risk  Management:  The  Cooperative is subject to market risk from
exposure  to  changes  in  interest  rates  based on its  financing  activities.
Agrilink Foods has entered into certain  financial  instrument  transactions  to
maintain the desired level of exposure to the risk of interest rate fluctuations
and to minimize interest expense. More specifically, Agrilink Foods entered into
two interest  rate swap  agreements  with the Bank of Montreal.  The  agreements
provide for fixed  interest  rate  payments by  Agrilink  Foods in exchange  for
payments received at the three-month LIBOR rate. See further  discussion at NOTE
5 "Debt - Interest Rate  Protection  Agreements"  to the "Notes to  Consolidated
Financial Statements."

The following is a summary of Agrilink Foods' interest rate swap agreements:

                                                 June 24, 2000

Interest Rate Swap:
Variable to Fixed - notional amount                $250,000,000
   Average pay rate                                 4.96-5.32%
   Average receive rate                                6.29%
   Maturities through                                  2001

Agrilink  Foods had a two-year  option to extend the maturity date on one of the
interest rate swap agreements with a notional amount of $100,000,000. On June 8,
1999,  Agrilink  Foods sold this  option to Bank of Montreal  for  approximately
$2,050,000.  The gain  resulting  from the  sale is  being  recognized  over the
remaining life of the interest rate swap.

While there is potential  that interest  rates will fall, and hence minimize the
benefits of Agrilink Foods' hedge position,  it is Agrilink Foods' position that
on a long-term basis,  the possibility of interest rates increasing  exceeds the
likelihood of interest rates decreasing.  Agrilink Foods will, however,  monitor
market conditions to adjust its position as it considers necessary.

Foreign Currency:  The Cooperative hedges certain foreign currency  transactions
by entering into forward exchange  contracts.  Gains and losses  associated with
currency rate changes on forward  exchange  contracts  hedging foreign  currency
transactions  are recorded in earnings  upon  settlement.  In fiscal  2000,  the
Cooperative  entered into forward exchange  contracts to hedge aggregate foreign
currency  exposures  of  approximately  $11.5  million.   The  forward  exchange
contracts have varying maturities ranging from July 2000 to April 2001 with cash
settlements made at maturity based upon rates agreed to at contract inception.

<TABLE>
ITEM 8.       FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

                          INDEX TO FINANCIAL STATEMENTS


<S>                                                                                                                        <C>
    ITEM                                                                                                                   Page
Pro-Fac Cooperative, Inc. and Consolidated Subsidiaries:
   Management's Responsibility for Financial Statements....................................................................   26
   Report of Independent Accountants.......................................................................................   27
   Consolidated Financial Statements:
     Consolidated Statements of Operations, Net Proceeds, and Comprehensive Income for the years ended June 24, 2000,
       June 26, 1999, and June 27, 1998....................................................................................   28
     Consolidated Balance Sheets as of June 24, 2000 and June 26, 1999.....................................................   29
     Consolidated Statements of Cash Flows for the years ended June 24, 2000, June 26, 1999, and June 27, 1998.............   30
     Consolidated Statements of Changes in Shareholders' and Members' Capitalization and Redeemable Stock
       for the years ended June 24, 2000, June 26, 1999, and June 27, 1998.................................................   32
     Notes to Consolidated Financial Statements............................................................................   33
     Selected Quarterly Financial Data.....................................................................................   54

</TABLE>

<PAGE>













              MANAGEMENT'S RESPONSIBILITY FOR FINANCIAL STATEMENTS

Management is  responsible  for the  preparation  and integrity of the financial
statements  and related  notes which begin on the page  following the "Report of
Independent Accountants." These statements have been prepared in accordance with
accounting principles generally accepted in the United States.

The  Cooperative's  accounting  systems include  internal  controls  designed to
provide reasonable assurance of the reliability of its financial records and the
proper  safeguarding and use of its assets.  Such controls are monitored through
the internal and external audit programs.

The  financial  statements  have been  audited  by  PricewaterhouseCoopers  LLP,
independent  accountants,  who were responsible for conducting their examination
in accordance with generally accepted auditing standards. Their resulting report
is on the subsequent page.

The  Board  of  Directors  exercises  its  responsibility  for  these  financial
statements. The independent accountants and internal auditors of the Cooperative
have full and free access to the Board.  The Board  periodically  meets with the
independent  accountants and the internal auditors,  without management present,
to discuss accounting, auditing and financial reporting matters.

/s/ Dennis M. Mullen                 /s/ Earl L. Powers
--------------------                 ------------------
    Dennis M. Mullen                    Earl L. Powers
    President and                       Executive Vice President Finance and
    Chief Executive Officer             Chief Financial Officer
    Agrilink Foods, Inc.                Agrilink Foods, Inc.

                                        Treasurer
                                        Pro-Fac Cooperative, Inc.

    August 1, 2000


<PAGE>














                        Report of Independent Accountants

To the Shareholders and
Board of Directors of
Pro-Fac Cooperative, Inc.

In our opinion,  the consolidated  financial  statements  listed under Item 8 of
this Form 10-K present fairly, in all material respects,  the financial position
of Pro-Fac Cooperative,  Inc. and its subsidiaries at June 24, 2000 and June 26,
1999,  and the results of their  operations and their cash flows for each of the
three years in the period ended June 24, 2000,  in  conformity  with  accounting
principles  generally accepted in the United States.  These financial statements
are the responsibility of the Cooperative's management; our responsibility is to
express  an  opinion  on these  financial  statements  based on our  audits.  We
conducted our audits of these  statements in accordance with auditing  standards
generally  accepted in the United  States which require that we plan and perform
the audit to obtain reasonable  assurance about whether the financial statements
are free of material misstatement. An audit includes examining, on a test basis,
evidence  supporting the amounts and  disclosures  in the financial  statements,
assessing the  accounting  principles  used and  significant  estimates  made by
management,  and evaluating the overall  financial  statement  presentation.  We
believe  that our audits  provide a reasonable  basis for the opinion  expressed
above.

Our audits of the  consolidated  financial  statements also included an audit of
the financial  statement schedule listed in the accompanying index and appearing
under  Item 14 of this Form  10-K.  In our  opinion,  this  financial  statement
schedule  presents fairly, in all material  respects,  the information set forth
therein for the fiscal  years ended June 24, 2000,  June 26, 1999,  and June 27,
1998  when  read  in  conjunction  with  the  related   consolidated   financial
statements.

PRICEWATERHOUSECOOPERS LLP



/s/ PricewaterhouseCoopers LLP

   Rochester, New York
   August 1, 2000


<PAGE>


                              FINANCIAL STATEMENTS

<TABLE>
Pro-Fac Cooperative, Inc. and Consolidated Subsidiaries - Agrilink Foods, Inc. and AgriFrozen Foods, Inc.
Consolidated Statements of Operations, Net Proceeds, and Comprehensive Income
(Dollars in Thousands)
<CAPTION>

                                                                                                Fiscal Years Ended
                                                                                ------------------------------------------------
                                                                                June 24, 2000    June 26, 1999     June 27, 1998
                                                                                -------------    -------------     -------------

<S>                                                                              <C>              <C>               <C>
Net sales                                                                        $ 1,268,542      $1,238,946        $  719,665
Cost of sales                                                                       (882,861)       (877,438)         (524,082)
                                                                                 -----------      ----------        ----------
Gross profit                                                                         385,681         361,508           195,583
Selling, administrative, and general expenses                                       (286,562)       (291,395)         (141,739)
Gains on sales of assets                                                               6,635          64,734                 0
Restructuring                                                                              0          (5,000)                0
Income from joint venture                                                              2,418           2,787             1,893
                                                                                 -----------      ----------        ----------
Operating income                                                                     108,172         132,634            55,737
Interest expense                                                                     (83,511)        (67,420)          (30,767)
Amortization of debt issue costs associated with the Bridge Facility                       0          (5,500)                0
                                                                                 -----------      ----------        ----------
Pretax income before extraordinary item, dividends, and
   allocation of net proceeds                                                         24,661          59,714            24,970
Tax provision                                                                         (8,497)        (24,746)           (7,840)
                                                                                 -----------      ----------        ----------
Income before extraordinary item, dividends, and allocation of net proceeds           16,164          34,968            17,130
Extraordinary item relating to the early extinguishment of debt (net of
   income taxes)                                                                           0         (18,024)                0
                                                                                 -----------      ----------        ----------
Net income                                                                       $    16,164      $   16,944        $   17,130
                                                                                 ===========      ==========        ==========

Allocation of Net Proceeds:
   Net income                                                                    $    16,164      $   16,944        $   17,130
   Dividends on common and preferred stock                                            (7,410)         (6,734)           (6,328)
                                                                                 -----------      ----------        ----------
   Net proceeds                                                                        8,754          10,210            10,802
   Allocation to earned surplus                                                       (3,832)        (10,210)           (4,662)
                                                                                 -----------      -----------       ----------
   Net proceeds available to members                                             $     4,922      $        0        $    6,140
                                                                                 ===========      ==========        ==========

Allocation of net proceeds available to members:
   Payable to members currently (30% of qualified proceeds
     available to members in fiscal 2000 and 25% in fiscal 1998)                 $     1,477      $        0        $    1,535

   Allocated to members but retained by the Cooperative:

     Qualified retains                                                                 3,445               0             4,605
                                                                                 -----------      ----------        ----------
     Net proceeds available to members                                           $     4,922      $        0        $    6,140
                                                                                 ===========      ==========        ==========

Net income                                                                       $    16,164      $   16,944        $   17,130
Other comprehensive income:
   Minimum pension liability                                                             238            (155)             (608)
                                                                                 -----------      ----------        ----------
Comprehensive income                                                             $    16,402      $   16,789        $   16,522
                                                                                 ===========      ==========        ==========
<FN>
The  accompanying  notes are an integral  part of these  consolidated  financial
statements.
</FN>
</TABLE>


<PAGE>

<TABLE>
Pro-Fac Cooperative, Inc. and Consolidated Subsidiaries - Agrilink Foods, Inc. and AgriFrozen Foods, Inc.
Consolidated Balance Sheets
(Dollars in Thousands)
<CAPTION>

                                     ASSETS

                                                                                                        June 24, 2000  June 26, 1999
                                                                                                        -------------  -------------
<S>                                                              <C>                     <C>             <C>           <C>
Current assets:
   Cash and cash equivalents                                                                             $    4,994    $    6,540
   Accounts receivable, trade (net of allowances for doubtful accounts of $998 and $1,607, respectively)    101,065        88,249
   Accounts receivable, other                                                                                10,488         9,848
   Income taxes refundable                                                                                    9,869        11,295
   Current deferred tax assets                                                                               12,176        16,160
   Inventories -
     Finished goods                                                                                         290,195       281,005
     Raw materials and supplies                                                                              51,736        50,057
                                                                                                         ----------    ----------
       Total inventories                                                                                    341,931       331,062
                                                                                                         ----------    ----------
   Current investment in CoBank                                                                               2,927         2,403
   Prepaid manufacturing expense                                                                             26,364        22,075
   Prepaid expenses and other current assets                                                                 19,688        27,883
                                                                                                         ----------    ----------
       Total current assets                                                                                 529,502       515,515
Investment in CoBank                                                                                         16,203        19,693
Investment in Great Lakes Kraut Company, LLC                                                                  6,775         6,679
Property, plant, and equipment, net                                                                         348,359       367,255
Assets held for sale at net realizable value                                                                    339           890
Goodwill and other intangible assets (net of accumulated amortization of  $28,248 and $22,031,
   respectively)                                                                                            258,545       260,733
Other assets                                                                                                 27,543        25,714
                                                                                                         ----------    ----------
       Total assets                                                                                      $1,187,266    $1,196,479
                                                                                                         ==========    ==========

            LIABILITIES AND SHAREHOLDERS' AND MEMBERS' CAPITALIZATION

Current liabilities:
   Notes payable                                                                                         $   49,800    $   54,900
   Current portion of obligations under capital leases                                                          218           208
   Current portion of long-term debt                                                                         16,583         8,670
   Accounts payable                                                                                          89,612       107,159
   Accrued interest                                                                                          11,398         5,974
   Accrued employee compensation                                                                             11,216        15,127
   Other accrued expenses                                                                                    66,397        64,603
   Dividends payable                                                                                             41            45
   Amounts due AgriFrozen growers                                                                             2,060         1,453
   Amounts due Class A members                                                                               21,696        20,045
                                                                                                         ----------    ----------
       Total current liabilities                                                                            269,021       278,184
Obligations under capital leases                                                                                520           568
Long-term debt                                                                                              679,205       702,322
Deferred income tax liabilities                                                                              36,825        23,072
Other non-current liabilities                                                                                33,852        32,222
Non-controlling interest in AgriFrozen                                                                        8,000         8,000
                                                                                                         ----------    ----------
       Total liabilities                                                                                  1,027,423     1,044,368
                                                                                                         ----------    ----------
Commitments and contingencies

Class B cumulative  redeemable preferred stock,  liquidation  preference $10 per
   share, authorized 500,000 shares; issued and outstanding 23,664
     and 26,061, respectively                                                                                   237           261
Class A common stock, par value $5, authorized 5,000,000 shares

                                                               June 24, 2000           June 26, 1999
                                                               -------------           -------------

   Shares issued                                                 2,132,981               1,995,740
   Shares subscribed                                               233,977                 384,649
                                                                 ---------               ---------
       Total subscribed and issued                               2,366,958               2,380,389
   Less subscriptions receivable in installments                  (233,977)               (384,649)
                                                                 ---------               ---------
       Total issued and outstanding                              2,132,981               1,995,740           10,665         9,979
                                                                 =========               =========
Class B common stock, par value $5, authorized 2,000,000 shares;
   issued and outstanding 723,229 and 0, respectively                                                             0             0
Shareholders' and members' capitalization:
   Retained earnings allocated to members                                                                    16,591        25,573
   Non-qualified allocation to members                                                                          300         2,050
Non-cumulative Preferred Stock, par value $25, authorized 5,000,000
   shares; issued and outstanding 34,400 and 39,635, respectively                                               860           991
Class A Cumulative Preferred Stock, liquidation preference $25 per share;
   authorized 10,000,000 shares; issued and outstanding 4,249,007 and
     3,694,495, respectively                                                                                106,225        92,362
Special membership interests                                                                                      0             0
Earned surplus                                                                                               25,490        21,658
Accumulated other comprehensive income:
   Minimum pension liability adjustment                                                                        (525)         (763)
                                                                                                         ----------    ----------
       Total shareholders' and members' capitalization                                                      148,941       141,871
                                                                                                         ----------    ----------
       Total liabilities and capitalization                                                              $1,187,266    $1,196,479
                                                                                                         ==========    ==========

<FN>
The  accompanying  notes are an integral  part of these  consolidated  financial
statements.
</FN>
</TABLE>


<PAGE>


<TABLE>
Pro-Fac Cooperative, Inc. and Consolidated Subsidiaries - Agrilink Foods, Inc. and AgriFrozen Foods, Inc.
Consolidated Statements of Cash Flows
(Dollars in Thousands)

                                                                                            Fiscal Years Ended

                                                                            June 24, 2000        June 26, 1999        June 27, 1998
                                                                            -------------        -------------        -------------
<S>                                                                          <C>                 <C>                   <C>
Cash Flows from Operating Activities:
   Net income                                                                $  16,164           $   16,944            $  17,130
   Amount payable to members currently                                          (1,477)                   0               (1,535)
   Adjustments to reconcile net income to net cash (used in)/provided by
     operating activities:
     Extraordinary item relating to the early extinguishment of debt
       (net of income taxes)                                                         0               18,024                    0
     Interest-in-kind on Subordinated Promissory Note                            1,571                  782                    0
     Gains on sales of assets                                                   (6,635)             (64,734)                   0
     Loss on disposal of assets                                                      0                  353                    0
     Amortization of goodwill and other intangible assets                        8,768                9,396                3,581
     Amortization of debt issue costs                                            4,805                7,678                  800
     Depreciation                                                               32,605               24,752               18,009
     Provision for deferred taxes                                               13,636                9,949                  752
     Provision for losses on accounts receivable                                   201                  208                   17
     Equity in undistributed earnings of CoBank                                   (412)                (520)                (715)
     Change in assets and liabilities:
       Accounts receivable                                                     (10,992)                  32               (9,311)
       Inventories and prepaid manufacturing expenses                          (66,754)              34,388              (25,654)
       Income taxes payable/refundable                                           1,426               (5,231)              (1,626)
       Accounts payable and accrued expenses                                   (16,353)             (52,639)              18,145
       Amounts due to members                                                    1,651                 (591)               4,845
       Other assets and liabilities                                             13,371              (16,078)             (11,360)
                                                                             ---------           ----------            ---------
Net cash (used in)/provided by operating activities                             (8,425)             (17,287)              13,078
                                                                             ---------           ----------            ---------
Cash Flows from Investing Activities:
   Purchase of property, plant, and equipment                                  (26,983)             (23,787)             (14,056)
   Proceeds from disposals of property, plant, and equipment                    63,955               93,486               12,794
   Proceeds from sales of idle facilities                                          405                1,427                    0
   Proceeds from investment in CoBank                                            3,378                2,795                1,611
   Cash paid for acquisitions                                                     (250)            (516,052)              (7,423)
                                                                             ---------           ----------            ---------
Net cash provided by/(used in) investing activities                             40,505             (442,131)              (7,074)
                                                                             ---------           ----------            ---------
Cash Flows from Financing Activities:
   Net (payments on)/proceeds from note payable                                 (5,100)              54,900                    0
   Proceeds from issuance of long-term debt                                          0              719,263               11,180
   Payments on long-term debt                                                  (18,470)            (287,574)              (8,076)
   Payments on capital leases                                                     (239)                (283)                (616)
   Cash paid for debt issuance costs and amendments                             (2,624)             (19,354)                   0
   Issuance of stock, net of repurchases                                           662                  844                  140
   Cash paid in lieu of fractional shares                                            0                    0                   (9)
   Cash portion of non-qualified conversion                                       (445)                (153)                 (84)
   Cash dividends paid                                                          (7,410)              (6,734)              (6,328)
                                                                             ---------           ----------            ---------
Net cash (used in)/provided by financing activities                            (33,626)             460,909               (3,793)
                                                                             ---------           ----------            ---------
Net change in cash and cash equivalents                                         (1,546)               1,491                2,211
Cash and cash equivalents at beginning of period                                 6,540                5,049                2,838
                                                                             ---------           ----------            ---------
Cash and cash equivalents at end of period                                   $   4,994           $    6,540            $   5,049
                                                                             =========           ==========            =========

Supplemental Disclosure of Cash Flow Information:
   Cash paid during the year for:
     Interest (net of amount capitalized)                                    $  78,087           $   70,005            $  30,319
                                                                             =========           ==========            =========
     Income taxes, net                                                       $   6,622           $   14,742            $   8,714
                                                                             =========           ==========            =========

     Acquisition of Flavor Destinations trademark:
       Goodwill and other intangible assets                                  $     250           $        0            $       0
                                                                             =========           ==========            =========

     Acquisition of Agripac, Inc.:
       Accounts receivable                                                   $       0           $   12,563            $       0
       Inventories                                                                   0               39,055                    0
       Property, plant, and equipment                                                0               30,327                    0
       Prepaid expenses and other current assets                                     0                1,063                    0
       Discount on subordinated note                                                 0                8,157                    0
       Other non-current assets                                                      0                4,000                    0
       Other accrued expenses                                                        0              (10,644)                   0
       Other non-current liabilities                                                 0               (4,000)                   0
       Non-controlling interest                                                      0               (8,000)                   0
                                                                             ---------           ----------            ---------
                                                                                     0               72,521                    0
       Escrow                                                                        0                6,413                    0
                                                                             ---------           ----------            ---------
                                                                                     0               78,934                    0
       Discount on subordinated note                                                 0               (8,157)                   0
                                                                             ---------           ----------            ---------
                                                                             $       0           $   70,777            $       0
                                                                             =========           ==========            =========

<FN>
The accompanying notes are an integral part of these financial statements.
</FN>
</TABLE>
<PAGE>
<TABLE>
Pro-Fac Cooperative, Inc. and Consolidated Subsidiaries - Agrilink Foods, Inc. and AgriFrozen Foods, Inc.
Consolidated Statements of Cash Flows (Continued)
(Dollars in Thousands)
<CAPTION>
                                                                                              Fiscal Years Ended
                                                                            -------------------------------------------------------
                                                                            June 24, 2000         June 26, 1999       June 27, 1998
                                                                            -------------         -------------       -------------
     <S>                                                                     <C>                  <C>                  <C>
     Acquisition of Erin's Gourmet Popcorn:
       Inventories                                                           $       0            $      33            $       0
       Property, plant, and equipment                                                0                   26                    0
       Goodwill and other intangible assets                                          0                  554                    0
                                                                             ---------            ---------            ---------
                                                                             $       0            $     613            $       0
                                                                             =========            =========            =========
     Acquisition of Dean Foods Vegetable Company:
       Accounts receivable                                                   $       0            $  24,201            $       0
       Current deferred tax asset                                                    0               30,645                    0
       Inventories                                                                   0              195,674                    0
       Prepaid expenses and other current assets                                     0                6,374                    0
       Property, plant, and equipment                                                0              157,227                    0
       Assets held for sale                                                          0                   49                    0
       Goodwill and other intangible assets                                          0              178,377                    0
       Accounts payable                                                              0              (40,865)                   0
       Accrued employee compensation                                                 0               (8,437)                   0
       Other accrued expenses                                                        0              (74,845)                   0
       Long-term debt                                                                0               (2,752)                   0
       Subordinated promissory note                                                  0              (22,590)                   0
       Other assets and liabilities, net                                             0               (2,453)                   0
                                                                             ---------            ---------            ---------
                                                                             $       0            $ 440,605            $       0
                                                                             =========            =========            =========
     Acquisition of J.A. Hopay Distributing Co., Inc.:
       Accounts receivable                                                   $       0            $     420            $       0
       Inventories                                                                   0                  153                    0
       Property, plant, and equipment                                                0                   51                    0
       Goodwill and other intangible assets                                          0                3,303                    0
       Other accrued expenses                                                        0                 (251)                   0
       Obligation for covenant not to compete                                        0               (1,363)                   0
                                                                             ---------            ----------           ---------
                                                                             $       0            $   2,313            $       0
                                                                             =========            =========            =========
     Acquisition of DelAgra:
       Accounts receivable                                                   $       0            $       0            $     403
       Inventories                                                                   0                    0                3,212
       Prepaid expenses and other current assets                                     0                    0                   81
       Property, plant, and equipment                                                0                    0                1,842
       Goodwill and other intangible assets                                          0                    0                1,508
       Other accrued expenses                                                        0                    0                 (433)
                                                                             ---------            ---------            ---------
                                                                             $       0            $       0            $   6,613
                                                                             =========            =========            =========
     Acquisition of C&O Distributing Company:
       Property, plant, and equipment                                        $       0            $       0            $      54
       Goodwill and other intangible assets                                          0                    0                  756
                                                                             ---------            ---------            ---------
                                                                             $       0            $       0            $     810
                                                                             =========            =========            =========
     Investment in Great Lakes Kraut Company, LLC:
       Inventories                                                           $       0            $       0            $   2,175
       Prepaid expenses and other current assets                                     0                    0                  409
       Property, plant, and equipment                                                0                    0                6,966
       Other accrued expenses                                                        0                    0                  (62)
                                                                             ---------            ---------            ---------
                                                                             $       0            $       0            $   9,488
                                                                             =========            =========            =========
Supplemental schedule of non-cash investing and financing activities:

         Conversion of retains to preferred stock                            $  13,732            $   4,648            $   6,967
                                                                             =========            =========            =========
         Net proceeds allocated to members but retained by the Cooperative   $   3,445            $       0            $   4,605
                                                                             =========            =========            =========
         Capital lease obligations incurred                                  $     171            $     320            $     222
                                                                             =========            =========            =========
<FN>
The accompanying notes are an integral part of these financial statements.
</FN>
</TABLE>
<PAGE>
<TABLE>
Pro-Fac Cooperative, Inc. and Consolidated Subsidiaries

Consolidated Statements of Changes in Shareholders' and Members' Capitalization and Redeemable Stock

(Dollars in Thousands)
<CAPTION>
                                                                                                  Fiscal Years Ended
                                                                                     ---------------------------------------------
                                                                                     June 24,        June 26,             June 27,
                                                                                       2000            1999                1998
                                                                                    ----------       -----------       -----------
<S>                                                                                 <C>              <C>               <C>
Retained earnings allocated to members:
Qualified retains:
   Balance at beginning of period                                                   $   25,573       $   29,765        $   31,920
   Net proceeds allocated to members                                                     3,445                0             4,605
   Converted to preferred stock                                                        (12,427)          (4,191)           (6,751)
   Cash paid in lieu of fractional shares                                                    0               (1)               (9)
                                                                                    ----------       ----------        ----------
   Balance at end of period                                                             16,591           25,573            29,765
                                                                                    ----------       ----------        ----------
Non-qualified retains:
   Balance at beginning of period                                                   $    2,050       $    2,660        $    2,960
   Distribution of non-qualified retains -
     Cash paid                                                                            (445)            (153)              (84)
     Converted to preferred stock                                                       (1,305)            (457)             (216)
                                                                                    ----------       -----------       ----------
   Balance at end of period                                                                300            2,050             2,660
                                                                                    ----------       ----------        ----------
Total retains allocated to members at end of period                                 $   16,891       $   27,623        $   32,425
                                                                                    ----------       ----------        ----------
Non-cumulative preferred stock:
   Balance at beginning of period                                                   $      991       $    1,125        $    1,345
   Conversion to cumulative preferred stock                                               (131)            (134)             (220)
                                                                                    ----------       ----------        ----------
   Balance at end of period                                                         $      860       $      991        $    1,125
                                                                                    ----------       ----------        ----------
Cumulative preferred stock:
   Balance at beginning of period                                                   $   92,362       $   87,580        $   80,393
   Converted from non-cumulative preferred stock                                           131              134               220
   Converted from non-qualified retains                                                  1,305              457               216
   Converted from qualified retains                                                     12,427            4,191             6,751
                                                                                    ----------       ----------        ----------
   Balance at end of period                                                         $  106,225       $   92,362        $   87,580
                                                                                    ----------       ----------        ----------
Earned surplus:
   Balance at beginning of period                                                   $   21,658       $   11,448        $    6,786
   Allocation to earned surplus                                                          3,832           10,210             4,662
                                                                                    ----------       ----------        ----------
   Balance at end of period                                                         $   25,490       $   21,658        $   11,448
                                                                                    ----------       ----------        ----------
Accumulated other comprehensive income:
   Balance at beginning of period                                                   $     (763)      $     (608)       $        0
   Minimum pension liability adjustment                                                    238             (155)             (608)
                                                                                    ----------       ----------        ----------
   Balance at end of period                                                               (525)            (763)             (608)
                                                                                    ----------       -----------       ----------
Total shareholders' and members' capitalization                                     $  148,941       $  141,871        $  131,970
                                                                                    ==========       ==========        ==========

Redeemable stock:
Class B cumulative preferred stock:
   Balance at beginning of period                                                   $      261       $      270        $      315
   (Repurchased)/issued, net                                                               (24)              (9)              (45)
                                                                                    ----------       ----------        ----------
   Balance at end of period                                                         $      237       $      261        $      270
                                                                                    ==========       ==========        ==========
Common stock:
   Balance at beginning of period                                                   $    9,979       $    9,129        $    8,944
   Issued/(repurchased), net                                                               686              850               185
                                                                                    ----------       ----------        ----------
   Balance at end of period                                                         $   10,665       $    9,979        $    9,129
                                                                                    ==========       ==========        ==========
<FN>
The  accompanying  notes are an integral  part of these  consolidated  financial
statements.
</FN>
</TABLE>
<PAGE>
             PRO-FAC COOPERATIVE, INC. AND CONSOLIDATED SUBSIDIARIES
                 AGRILINK FOODS, INC. AND AGRIFROZEN FOODS, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1.    SUMMARY OF ACCOUNTING POLICIES

Pro-Fac is an agricultural  cooperative  which processes and markets crops grown
by  its  members  through  its  wholly-owned  subsidiary  Agrilink  Foods,  Inc.
("Agrilink   Foods")  and  through  its  subsidiary   AgriFrozen   Foods,   Inc.
("AgriFrozen")  in which  it has a  controlling  interest.  Unless  the  context
otherwise  requires,  the terms  "Cooperative"  and  "Pro-Fac"  refer to Pro-Fac
Cooperative, Inc. and its subsidiaries.

Agrilink Foods has four primary  product lines  including:  vegetables,  fruits,
snacks,  and canned meals.  The majority of each of the product lines' net sales
is within  the United  States.  AgriFrozen  has  vegetables  as its one  primary
product  line.  The majority of each of the product  lines' net sales are within
the United States. In addition,  all of the Cooperative's  operating facilities,
excluding one in Mexico, are within the United States.

The  accompanying  consolidated  financial  statements  have  been  prepared  in
accordance with accounting principles,  generally accepted in the United States,
which  requires  management to make  estimates and  assumptions  that affect the
reported  amounts of assets and liabilities and disclosure of contingent  assets
and liabilities at the date of the financial statements and the reported amounts
of revenues and expenses  during the  reporting  period.  Actual  results  could
differ from these estimates.

Fiscal  Year:  The fiscal  year of Pro-Fac  ends on the last  Saturday  in June.
Fiscal 2000, 1999, and 1998 each comprised 52 weeks.

Consolidation: The consolidated financial statements include the Cooperative and
its subsidiaries,  Agrilink Foods and AgriFrozen.  The financial  statements are
after  elimination of  intercompany  transactions  and balances.  Investments in
affiliates,  owned more than 20  percent  but not in excess of 50  percent,  are
recorded under the equity method of accounting.

Reclassification:  Certain items for fiscal 1999 and 1998 have been reclassified
to conform with the current presentation.

Restructuring:  During the third  quarter of fiscal 1999,  Agrilink  Foods began
implementation of a corporate-wide restructuring program. The overall objectives
of the plan  were to  reduce  expenses,  improve  productivity,  and  streamline
operations.  The total  restructuring  charge  amounted to $5.0  million and was
primarily comprised of employee termination benefits (which have improved annual
earnings  by  $8.0  million).  Efforts  have  focused  on the  consolidation  of
operating  functions and the elimination of  approximately 5 percent of the work
force. Reductions in personnel include operational and administrative positions.
Of this charge,  $3.3 million has been  liquidated  to date,  and the  remaining
termination benefits will be liquidated within the next 12 months.

Extraordinary  Item Relating to the Early  Extinguishment of Debt: During fiscal
1999, Agrilink Foods refinanced its existing indebtedness,  including its 12 1/4
percent  Senior  Subordinated  Notes due 2005 and its then  existing  bank debt.
Premiums and breakage  fees  associated  with early  redemptions  and other fees
incurred  amounted to $18.0  million  (net of  applicable  income taxes of $10.4
million). See NOTE 3 to the "Notes to Consolidated Financial Statements."

Cash  and  Cash  Equivalents:  Cash  and  cash  equivalents  include  short-term
investments with original maturities of three months or less. There were no such
short-term investments at June 24, 2000 or June 26, 1999.

Inventories:  Inventories  are  stated  at the  lower of cost or  market  on the
first-in, first-out ("FIFO") method. Reserves recorded at June 24, 2000 and June
26,  1999 were  $3,385,000,  and  $8,401,000,  respectively.  Reductions  to the
reserve  were  recorded  in  fiscal  2000 as  related  inventory  was  disposed,
primarily associated with AgriFrozen.

Investment in CoBank:  The  Cooperative's  investment in CoBank is required as a
condition of borrowings.  These securities are not physically  issued by CoBank,
but  rather  the  Cooperative  is  notified  as to  their  monetary  value.  The
investment is carried at cost plus the Cooperative's  share of the undistributed
earnings of CoBank (that portion of patronage refunds not distributed  currently
in cash).

Earnings on the  Cooperative's  investment in CoBank in fiscal year 2000,  1999,
and 1998 amounted to $590,000, $743,000, and $1,023,000, respectively.

Prepaid Manufacturing Expense:  Allocation of manufacturing overhead to finished
goods produced is on the basis of a production  period;  thus at the end of each
period,  manufacturing costs incurred by seasonal plants,  subsequent to the end
of previous  pack  operations,  are deferred  and  included in the  accompanying
balance  sheet.  Such  costs are  applied  to  finished  goods  during  the next
production period and recognized as an element of cost of goods sold.


<PAGE>


Property, Plant, and Equipment and Related Lease Arrangements:  Property, plant,
and equipment  are  depreciated  over the  estimated  useful lives of the assets
using the straight-line method, half-year convention, over 4 to 40 years.

Lease arrangements are capitalized when such leases convey  substantially all of
the risks and benefits  incidental  to ownership.  Capital  leases are amortized
over either the lease term or the life of the  related  assets,  depending  upon
available purchase options and lease renewal features.

Assets  held  for sale are  separately  classified  on the  balance  sheet.  The
recorded value represents an estimate of net realizable value.

Goodwill and Other Intangibles: Goodwill and other intangible assets include the
cost in excess of the fair value of net  tangible  assets  acquired  in purchase
transactions and acquired  non-competition  agreements and trademarks.  Goodwill
and  other  intangible  assets,  stated  net of  accumulated  amortization,  are
amortized  on  a  straight-line  basis  over  3 to  35  years.  The  Cooperative
periodically assesses whether there has been a permanent impairment in the value
of  goodwill.  This  is  accomplished  by  determining  whether  the  estimated,
undiscounted  future cash flows from  operating  activities  exceed the carrying
value of goodwill as of the assessment date.  Should aggregate future cash flows
be less than the carrying value, a writedown would be required,  measured by the
difference  between the  discounted  future cash flows and the carrying value of
goodwill.

Other Assets:  Other assets are primarily  comprised of debt issuance costs. The
debt  issuance  costs  are  amortized  over the term of the  debt.  Amortization
expense  incurred,  including  $5,500,000  of fees  associated  with the  Bridge
Facility in fiscal 1999,  were  $2,758,000,  $7,678,000,  and $800,000 in fiscal
2000, 1999, and 1998, respectively.

Income Taxes:  Income taxes are provided on  non-patronage  income for financial
reporting purposes.  Deferred income taxes resulting from temporary  differences
between  financial  reporting  and tax reporting as well as from the issuance of
non-qualified retains are appropriately classified in the balance sheet.

Pension:  The  Cooperative and its  subsidiaries  have several pension plans and
participate  in various  union  pension  plans  which on a combined  basis cover
substantially  all employees.  Charges to income with respect to plans sponsored
by the Cooperative and its subsidiaries  are based upon  actuarially  determined
costs.  Pension  liabilities  are funded by  periodic  payments  to the  various
pension plan trusts.

Derivative  Financial  Instruments:  The Cooperative does not engage in interest
rate  speculation.  Derivative  financial  instruments  are  utilized  to  hedge
interest rate risks and are not held for trading purposes.

Agrilink Foods has entered into interest rate swap  agreements to limit exposure
to interest  rate  movements.  Net payments or receipts are accrued into prepaid
expenses and other current assets and/or other accrued expenses and are recorded
as adjustments to interest  expense.  Interest rate instruments are entered into
for periods no greater than the life of the underlying transaction being hedged.
Management  anticipates  that  all  interest  rate  derivatives  will be held to
maturity.   Any  gains  or  losses  on  prematurely   terminated  interest  rate
derivatives  will  be  recognized  over  the  remaining  life,  if  any,  of the
underlying transaction as an adjustment to interest expense.

Commodities  Options  Contracts:  In  connection  with the  purchase  of certain
commodities  for  anticipated   manufacturing   requirements,   the  Cooperative
occasionally  enters into options contracts as deemed  appropriate to reduce the
effect of price  fluctuations.  These  options  contracts  are  accounted for as
hedges and, accordingly, gains and losses are deferred and recognized in cost of
sales as part of the product cost.  These  activities are not significant to the
Cooperative's operations as a whole.

Foreign Currency:  The Cooperative hedges certain foreign currency  transactions
by entering into forward exchange  contracts.  Gains and losses  associated with
currency rate changes on forward  exchange  contracts  hedging foreign  currency
transactions  are recorded in earnings  upon  settlement.  In fiscal  2000,  the
Cooperative  entered into forward exchange  contracts to hedge aggregate foreign
currency  exposures  of  approximately  $11.5  million.   The  forward  exchange
contracts have varying maturities ranging from July 2000 to April 2001 with cash
settlements made at maturity based upon rates agreed to at contract inception.

Recently Issued  Accounting  Statements:  In June 1998, the FASB issued SFAS No.
133, Accounting for Derivative Instruments and Hedging Activities. In June 1999,
the FASB issues SFAS 137,  which  deferred the effective date of SFAS No. 133 to
fiscal years  beginning  after June 15, 2000,  and requires all  derivatives  be
measured at fair value and recorded on a company's  balance sheet as an asset or
liability,  depending  upon  the  company's  underlying  rights  or  obligations
associated  with the  derivative  instrument.  Agrilink Foods and AgriFrozen are
currently investigating the impact of this pronouncement.


<PAGE>


Casualty  Insurance:  The  Cooperative is insured for workers  compensation  and
automobile liability through a primarily  self-insured  program. The Cooperative
accrues for the estimated losses from both asserted and unasserted  claims.  The
estimate  of  the  liability  for  unasserted  claims  arising  from  unreported
incidents is based on an analysis of  historical  claims  data.  The accrual for
casualty  insurance at June 24, 2000 and June 26, 1999 was $5.2 million and $6.3
million, respectively.

Environmental  Expenditures:  Environmental expenditures that pertain to current
operations  are  expensed  or  capitalized  consistent  with  the  Cooperative's
capitalization  policy.  Expenditures  that  result from the  remediation  of an
existing  condition  caused by past operations that do not contribute to current
or  future  revenues  are  expensed.  Liabilities  are  recorded  when  remedial
activities are probable, and the cost can be reasonably estimated.

Advertising:  Production  costs of commercials  and  programming  are charged to
operations in the year first aired. The cost of other advertising  promotion and
marketing  programs  are  charged  in the  year  incurred.  Advertising  expense
incurred in fiscal 2000,  1999, and 1998 amounted to  $43,597,000,  $38,192,000,
and $9,878,000, respectively.

Earnings Per Share Data Omitted: Earnings per share amounts are not presented as
earnings  are not  distributed  to members in  proportion  to their common stock
holdings.  Earnings  (representing those earnings derived from patronage-sourced
business)  are  distributed  to members  in  proportion  to the dollar  value of
deliveries under Pro-Fac  contracts rather than based on the number of shares of
common stock held.

Disclosures About Fair Value of Financial Instruments: The following methods and
assumptions   were  used  by  the  Cooperative  in  estimating  the  fair  value
disclosures for financial instruments:

         Cash and Cash  Equivalents  and  Notes  Payable:  The  carrying  amount
         approximates  fair  value  because  of  the  short  maturity  of  these
         instruments.

         Long-Term  Investments:  The carrying value of the investment in CoBank
         was $19.1  million at June 24,  2000.  As there is no market  price for
         this investment, a reasonable estimate of fair value is not possible.

         Long-Term Debt: The fair value of the long-term debt is estimated based
         on the quoted  market  prices for the same or similar  issues or on the
         current rates offered for debt of the same  remaining  maturities.  See
         NOTE 5 to the "Notes to Consolidated Financial Statements."

NOTE 2.       AGREEMENTS WITH AGRILINK FOODS AND AGRIFROZEN

Agrilink Foods: The contractual  relationship between Pro-Fac and Agrilink Foods
is defined in the Pro-Fac  Marketing and  Facilitation  Agreement  (the "Pro-Fac
Marketing  Agreement").  Under the Pro-Fac Marketing  Agreement,  Agrilink Foods
pays  Pro-Fac the  commercial  market  value  ("CMV") for all crops  supplied by
Pro-Fac.  CMV is defined as the weighted  average price paid by other commercial
processors  for similar  crops sold under  preseason  contracts  and in the open
market in the same or competing  market area.  Although CMV is intended to be no
more than the fair market value of the crops purchased by Agrilink Foods, it may
be more or less than the price  Agrilink  Foods  would pay in the open market in
the absence of the Pro-Fac Marketing Agreement.

Under the  Pro-Fac  Marketing  Agreement,  Agrilink  Foods  paid  Pro-Fac  $69.6
million,  $62.2  million,  and $58.5  million  as CMV for crops  purchased  from
Pro-Fac in fiscal years 2000, 1999, and 1998, respectively.  The crops purchased
by Agrilink  Foods from Pro-Fac  Class A members  represented  approximately  55
percent,  71 percent,  and 76 percent of the raw agricultural crops purchased by
Agrilink Foods from Pro-Fac in fiscal 2000, 1999, and 1998, respectively.

Under the Pro-Fac Marketing Agreement, Agrilink Foods is required to have on its
board of directors  individuals  who are neither  members of nor affiliated with
Pro-Fac ("Disinterested  Directors"), the number of Disinterested Directors must
at least equal the number of  directors  who are members of  Pro-Fac's  board of
directors.  The volume and type of crops to be purchased by Agrilink  Foods from
Pro-Fac under the Pro-Fac  Marketing  Agreement are  determined  pursuant to its
annual  profit  plan,   which  requires  the  approval  of  a  majority  of  the
Disinterested  Directors of Agrilink  Foods.  In addition,  in any year in which
Agrilink Foods has earnings on products which were processed from crops supplied
by Pro-Fac ("Pro-Fac Products"), Agrilink Foods pays to Pro-Fac up to 90 percent
of such  earnings,  but in no case more than 50 percent  of all pretax  earnings
(before  dividing with Pro-Fac) of Agrilink  Foods.  In years in which  Agrilink
Foods has losses on Pro-Fac  Products,  Agrilink  Foods reduces the CMV it would
otherwise  pay to Pro-Fac by up to 90 percent of such losses,  but in no case by
more than 50 percent of all pretax  losses  (before  dividing  with  Pro-Fac) of
Agrilink  Foods.  Additional  patronage  income is paid to Pro-Fac for  services
provided to Agrilink Foods, including the provision of a long-term,  stable crop
supply,  favorable payment terms for crops and the sharing of risks in losses of
certain  operations of the business.  For fiscal years ended 2000 and 1998, such
additional patronage income amounted to $12.3 million and $12.5 million,


<PAGE>


respectively.  During  fiscal 1999,  there was no additional  patronage  income.
Under the Pro-Fac Marketing Agreement,  Pro-Fac is required to reinvest at least
70 percent of the additional  patronage income in Agrilink Foods.  Subsequent to
the  acquisition  date,  Pro-Fac has  invested an  additional  $29.9  million in
Agrilink Foods.

AgriFrozen:  The  contractual  relationship  between  Pro-Fac and  AgriFrozen is
defined in a marketing and facilitation agreement between Pro-Fac and AgriFrozen
(the  "AgriFrozen  Marketing  Agreement").  Under  this  agreement,   AgriFrozen
purchases  raw  products  from  Pro-Fac and  processes  and markets the finished
products.  AgriFrozen will pay Pro-Fac CMV for the crops supplied by Pro-Fac. In
addition,  in any  year  in  which  AgriFrozen  has  earnings,  AgriFrozen  will
distribute such earnings to members of Pro-Fac. However, in the event AgriFrozen
experiences  any  losses,  AgriFrozen  will deduct the losses from the total CMV
payable.  The agreement permits  AgriFrozen to pay 20 percent in cash and retain
80 percent of its earnings on Pro-Fac products as working capital.

Under the AgriFrozen Marketing Agreement,  AgriFrozen paid Pro-Fac $14.0 million
in CMV for crops purchased in fiscal 2000.

Under the AgriFrozen Marketing  Agreement,  the board of directors of AgriFrozen
is required to consist of: (i) at least three and as many as five  directors who
are  individuals  who currently serve as directors of Pro-Fac and who are chosen
by  Pro-Fac's  board of  directors;  (ii) one  director  who is nominated by the
president of Agrilink Foods from among Agrilink Foods' management employees; and
(iii)  any  number  of  disinterested  directors  who  are  to be  elected  from
individuals  suggested  by  the  president  of  Agrilink  Foods.   Disinterested
directors  are persons who are neither  employees,  shareholders,  nor otherwise
affiliated with Pro-Fac or AgriFrozen,  but may include a disinterested director
of Agrilink Foods.

NOTE 3.       ACQUISITIONS AND DISPOSALS

Fiscal 2000 -

Sale of Pickle  Business:  On June 23,  2000,  Agrilink  Foods  sold its  pickle
business  based in Tacoma,  Washington  to Dean  Pickle and  Specialty  Products
Company.  This  business  included  pickle,  pepper,  and relish  products  sold
primarily  under the Nalley and Farman's  brand names.  Agrilink  Foods received
proceeds of  approximately  $10.3 million which were applied to bank loans ($4.0
million of which was applied to the Term Loan Facility and $6.3 million of which
was  applied  to  Agrilink  Foods'  Revolving  Credit   Facility).   A  gain  of
approximately $4.3 million was recognized on this transaction.

On July 21, 2000,  Agrilink  Foods sold the machinery and equipment  utilized in
the  production  of  pickles  and other  related  products  to Dean  Pickle  and
Specialty  Products Company.  No significant gain or loss was recognized on this
transaction. Net proceeds of approximately $3.2 million were applied to the Term
Loan Facility.

This  transaction  did not include any other products  carrying the Nalley brand
name,  including prepared canned meal products.  Agrilink Foods will continue to
contract pack Nalley and Farman's  pickle  products for a period of two years at
the existing Tacoma processing plant which Agrilink Foods will operate.

Under a related  agreement,  the Cooperative  will supply raw cucumbers grown in
the Northwestern United States to Dean Pickle and Specialty Products Company for
a minimum 10-year period at market pricing.

Sale of Midwest Private Label Canned  Vegetable  Business:  On November 8, 1999,
Agrilink Foods completed the sale of its Midwest private label canned  vegetable
business  to Seneca  Foods.  Included  in this  transaction  was the  Arlington,
Minnesota  facility.  Agrilink Foods received  proceeds of  approximately  $42.4
million  which were applied to  borrowings  outstanding  under  Agrilink  Foods'
Revolving Credit Facility. In addition,  Seneca Foods issued to Agrilink Foods a
$5.0 million unsecured  subordinated  promissory note due February 8, 2009. This
transaction did not include  Agrilink  Foods' retail branded canned  vegetables,
Veg-All  and  Freshlike.  No  significant  gain or loss was  recognized  on this
transaction.

On  December  17,  1999,  Agrilink  Foods  completed  the  sale of the  Cambria,
Wisconsin  processing  facility  to Del Monte.  Agrilink  received  proceeds  of
approximately  $10.5  million  which were applied to bank loans ($6.0 million of
which  was  applied  to the Term Loan  Facility  and $4.5  million  of which was
applied to Agrilink's  Revolving Credit Facility).  A gain of approximately $2.3
million was recognized on this transaction.  The sale also includes an agreement
for Del Monte to produce a portion of Agrilink  Foods'  product needs during the
2000 packing season.

Fiscal 1999 -

Acquisition  of Agripac  Frozen  Vegetable  Business:  On February 23, 1999,  PF
Acquisition  II,  Inc.,  which does  business  under the name  AgriFrozen  Foods
("AgriFrozen"),   acquired  the  frozen  vegetable  business  of  Agripac,  Inc.
("Agripac"), an Oregon cooperative.

<PAGE>


AgriFrozen  was formed in January  1999 under the  corporation  laws of New York
State.  AgriFrozen  was  formed to  acquire  substantially  all of the assets of
Agripac related to its frozen vegetable processing business.  On January 4, 1999
Agripac filed a voluntary  petition under Chapter 11 of the  Bankruptcy  Code in
the United States  Bankruptcy  Court for the District of Oregon.  On January 22,
1999 Agripac, as debtor-in-possession,  filed a motion with the Bankruptcy Court
for authority to sell substantially all of the assets comprising its frozen food
processing business. The bankruptcy court confirmed the sale of Agripac's frozen
food processing assets to AgriFrozen by an order entered on February 18, 1999.

The  purchase  price  for the  assets  was  $80.5  million.  AgriFrozen  paid an
additional  $7.8 million in related  expenses,  including  $6.4 million to prior
member-growers  of Agripac to obtain crop delivery  agreements with  AgriFrozen,
and  transaction   expenses  and  miscellaneous  costs  totaling  $1.4  million.
AgriFrozen  incurred an additional  $1.2 million in severance  costs  associated
with the acquisition and the  implementation  of AgriFrozen's  business plan. In
connection  with,  and as a condition to the  consummation  of the  acquisition,
AgriFrozen  entered into a sufficient  number of crop  delivery  contracts  with
prior member growers of Agripac acceptable to AgriFrozen.

The acquisition was accounted for under the purchase method of accounting. Under
purchase  accounting  tangible and identifiable  intangible  assets acquired are
recorded at their  respective fair values.  Final  allocations of purchase price
were made within one year of the acquisition date.

In order to consummate  the  acquisition,  AgriFrozen  (i) entered into a credit
facility with CoBank, ACB ("CoBank) (the "CoBank Credit Facility") providing for
$30 million of term loan borrowings and a revolving credit facility (the "CoBank
Revolving  Credit  Facility")  of $55  million in fiscal 2000 and $50 million in
each year thereafter and (ii) issued a $12 million Subordinated  Promissory Note
to CoBank. Neither Pro-Fac nor Agrilink Foods guaranteed the debts of AgriFrozen
or  otherwise  pledged any of their  respective  properties  as security for the
CoBank financing. All of AgriFrozen's indebtedness is expressly without recourse
to Pro-Fac and Agrilink Foods.

Phase I  environmental  audits were  performed on the  facilities  acquired from
Agripac,  including  lease  properties.  A number  of  environmental  conditions
requiring  remedial action have been identified,  but none of them individually,
or in the  aggregate,  are expected to exceed $4.0 million  debt  reduction  for
environmental remediation to be provided by CoBank.

As  part  of  its  business  strategy,  AgriFrozen  has  also  entered  into  an
administrative services agreement with Agrilink Foods to provide it with certain
management consulting and administrative services.

The effects of the Agripac  acquisition are not material and  accordingly,  have
been excluded from the pro forma  information  presented  below.  The operations
from Agripac have been included in the Company's  Statement of Operations  since
the acquisition date.

Sale of Adams Brand Peanut  Butter  Operations:  On January 29,  1999,  Agrilink
Foods sold the Adams brand peanut butter operations to the J.M. Smucker Company.
Agrilink  Foods  received  proceeds of  approximately  $13.5  million which were
applied to  outstanding  bank loans.  A gain of  approximately  $3.5 million was
recognized on this transaction.

Acquisition  of Erin's  Gourmet  Popcorn:  On January 5,  1999,  Agrilink  Foods
acquired  the assets of Erin's  Gourmet  Popcorn  ("Erin's"),  a  Seattle-based,
ready-to-eat  popcorn  manufacturer.  The  acquisition  was  accounted  for as a
purchase.  The purchase  price was  approximately  $0.6 million.  Intangibles of
approximately  $0.6 million were recorded in conjunction  with this  transaction
and are being amortized over 3 to 30 years.

The effects of the Erin's  acquisition are not material,  and accordingly,  have
been excluded from the pro forma  information  presented  below.  The operations
from Erin's have been  included in the Company's  Statement of Operations  since
the acquisition date.

Acquisition of Dean Foods  Vegetable  Company:  On September 24, 1998,  Agrilink
Foods acquired the Dean Foods Vegetable Company ("DFVC"),  the frozen and canned
vegetable  business of Dean Foods Company ("Dean  Foods"),  by acquiring all the
outstanding  capital  stock of Dean  Foods  Vegetable  Company  and Birds Eye de
Mexico  SA  de  CV  (the  "DFVC  Acquisition").  In  connection  with  the  DFVC
Acquisition,  Agrilink Foods sold its aseptic  business to Dean Foods.  Agrilink
Foods paid $360 million in cash,  net of the sale of the aseptic  business,  and
issued to Dean Foods a $30 million  unsecured  subordinated  promissory note due
November  22,  2008  (the  "Dean  Foods   Subordinated   Promissory  Note"),  as
consideration  for  the  DFVC   Acquisition.   Agrilink  Foods  had  the  right,
exercisable  until July 15, 1999,  to require Dean Foods,  jointly with Agrilink
Foods,  to treat the DFVC  Acquisition  as an asset sale for tax purposes  under
Section  338(h)(10) of the Internal  Revenue  Code. On April 15, 1999,  Agrilink
Foods paid $13.2 million to Dean Foods and exercised the election.


<PAGE>


After the DFVC  Acquisition,  DFVC was merged into Agrilink Foods. DFVC has been
one of the leading  processors of vegetables in the United  States,  selling its
products under well-known brand names, such as Birds Eye, Freshlike and Veg-All,
and various  private labels.  Agrilink Foods believes that the DFVC  Acquisition
strengthens its competitive position by: (i) enhancing its brand recognition and
market  position,  (ii) providing  opportunities  for cost savings and operating
efficiencies and (iii) increasing its product and geographic diversification.

The DFVC  Acquisition was accounted for under the purchase method of accounting.
Under purchase accounting,  tangible and identifiable intangible assets acquired
and liabilities assumed were recorded at their respective fair values.  Goodwill
associated with the DFVC Acquisition is being amortized over 30 years.

The following  unaudited pro forma financial  information  presents a summary of
consolidated results of operations of Pro-Fac and DFVC as if the acquisition had
occurred at the beginning of the 1999 fiscal year.

(Dollars in Millions)

                                                      Fiscal Year Ended
                                                        June 26, 1999

Net sales                                                   $1,336.0
Income before extraordinary items                           $   25.1
Net income                                                  $    7.1

These  unaudited pro forma results have been prepared for  comparative  purposes
only  and  include   adjustments   for  additional   depreciation   expense  and
amortization and interest expense on acquisition debt. They do not purport to be
indicative of the results of operations  which  actually would have resulted had
the  combination  been in effect at the beginning of the 1999 fiscal year, or of
the future operations of the consolidated entities.

Concurrently  with the DFVC  Acquisition,  Agrilink  Foods  refinanced  its then
existing  indebtedness (the "Refinancing"),  including its 12 1/4 percent Senior
Subordinated  Notes due 2005 (the "Old Notes") and its then  existing bank debt.
On August 24, 1998, Agrilink Foods commenced a tender offer (the "Tender Offer")
for all the Old Notes and consent  solicitation to certain  amendments under the
indenture governing the Old Notes to eliminate substantially all the restrictive
covenants and certain events of default therein.  Substantially  all of the $160
million aggregate  principal amount of the Old Notes were tendered and purchased
by Agrilink Foods for aggregate  consideration  of  approximately  $184 million,
including  accrued interest of $2.9 million.  Agrilink Foods also terminated its
then existing bank facility  (including  seasonal  borrowings) and repaid $176.5
million,  excluding  interest  owed and breakage  fees  outstanding  thereunder.
Agrilink Foods recognized an extraordinary  item of $18.0 million (net of income
taxes) in the first quarter of fiscal 1999 relating to this refinancing.

In order to consummate the DFVC  Acquisition  and the Refinancing and to pay the
related  fees and  expenses,  Agrilink  Foods:  (i)  entered  into a new  credit
facility  (the "New Credit  Facility")  providing  for $455 million of term loan
borrowings (the "Term Loan Facility") and up to $200 million of revolving credit
borrowings (the "Revolving Credit Facility"),  (ii) entered into and drew upon a
$200 million  bridge loan facility (the "Bridge  Facility") and (iii) issued the
$30 million Subordinated  Promissory Note to Dean Foods. The Bridge Facility was
repaid during November of 1998  principally  with the proceeds from a new Senior
Subordinated  Note  Offering  (the  "New  Notes").  See  NOTE 5 - "Debt - Senior
Subordinated Notes 11 -7/8 Percent (due 2008)." Debt issue costs of $5.5 million
associated  with the Bridge  Facility  were  expensed  during the quarter  ended
December 26, 1998.

Acquisition  of J.A.  Hopay  Distributing  Co,  Inc.:  Effective  July 21, 1998,
Agrilink  Foods  acquired  J.A.  Hopay   Distributing  Co.,  Inc.  ("Hopay")  of
Pittsburgh, Pennsylvania. Hopay distributed snack products for Snyder of Berlin,
one of the  Company's  businesses  included  within its snack  foods  unit.  The
acquisition  was  accounted  for as a  purchase.  The  purchase  price  (net  of
liabilities   assumed)  was   approximately   $2.3   million.   Intangibles   of
approximately  $3.3 million were recorded in conjunction  with this  transaction
and are being amortized over 5 to 30 years.

The effects of the Hopay  acquisition  are not material and,  accordingly,  have
been excluded from the above pro forma  presentation.  The operations from Hopay
have  been  included  in  the  Company's   Statement  of  Operations  since  the
acquisition date.

Fiscal 1998 -

Sale of Michigan  Distribution Center:  Effective March 31, 1998, Agrilink Foods
entered into a multiyear  logistics  agreement  under which GATX  Logistics will
provide freight  management,  packaging and labeling services,  and distribution
support to and from production  facilities owned by Agrilink Foods in and around
Coloma, Michigan. The agreement included the sale of Agrilink Foods'


<PAGE>


labeling equipment and distribution center.  Agrilink Foods received proceeds of
$12.6 million for the equipment and facility  which were applied to  outstanding
bank  loans.  No  significant  gain  or  loss  occurred  as  a  result  of  this
transaction.

Acquisition of DelAgra Corp.:  Effective March 30, 1998, Agrilink Foods acquired
the  majority  of assets and the  business  of  DelAgra  Corp.  of  Bridgeville,
Delaware.  DelAgra Corp. is a producer of private label frozen  vegetables.  The
acquisition   was  accounted  for  as  a  purchase.   The  purchase   price  was
approximately  $6.6  million.  Goodwill of  approximately  $0.6 million and $0.9
million for a covenant not to compete  were  received in  conjunction  with this
transaction.   These  amounts  are  being   amortized   over  30  and  5  years,
respectively.  The  operations  of  DelAgra  Corp.  have  been  included  in the
Company's Statement of Operations since the acquisition date.

Acquisition of C&O Distributing Company: Effective March 9, 1998, Agrilink Foods
acquired the majority of assets and the business of C&O Distributing  Company of
Canton,  Ohio.  C&O  distributed  snack  products  for Snyder of Berlin,  one of
Agrilink Foods' businesses included within its snack foods unit. The acquisition
was  accounted  for as a purchase.  The purchase  price was  approximately  $0.8
million.  Intangibles of approximately $0.8 million were recorded in conjunction
with this  transaction and are being amortized over 30 years.  The operations of
C&O have been  included  in the  Company's  Statement  of  Operations  since the
acquisition date.

Formation of New Sauerkraut Company:  Effective July 1, 1997, Agrilink Foods and
Flanagan Brothers,  Inc. of Bear Creek,  Wisconsin  contributed all their assets
involved in sauerkraut  production to form a new  sauerkraut  company.  This new
company,  Great  Lakes  Kraut  Company,  LLC,  operates  as a New  York  limited
liability  company with ownership and earnings  divided  equally between the two
companies.  The joint  venture  is  accounted  for using  the  equity  method of
accounting.  Summarized financial  information of Great Lakes Kraut Company, LLC
is as follows:

Condensed Statement of Earnings
(Dollars in Thousands)

                                               Fiscal Years Ended
                              June 24, 2000       June 26, 1999    June 27, 1998

Net sales                       $  32,200           $  30,174         $ 27,620
Gross profit                    $   9,150           $   9,392         $  7,439
Operating income                $   5,488           $   6,267         $  4,411
Net income                      $   4,836           $   5,575         $  3,786

Condensed Balance Sheet
(Dollars in Thousands)

                              June 24, 2000       June 26, 1999

Current assets                  $  12,464           $  14,112
Noncurrent assets               $  22,081           $  21,669
Current liabilities             $  13,158           $  13,237
Noncurrent liabilities          $   4,579           $   5,736



<PAGE>


NOTE 4.       PROPERTY, PLANT AND EQUIPMENT AND RELATED OBLIGATIONS

The  following  is a summary  of  property,  plant  and  equipment  and  related
obligations at June 24, 2000 and June 26, 1999:

<TABLE>
(Dollars in Thousands)
<CAPTION>

                                                  June 24, 2000                                  June 26, 1999

                                        Owned         Leased                         Owned           Leased
                                         Assets        Assets           Total         Assets          Assets            Total
                                       ----------    ----------      -----------    ----------      ----------       --------

<S>                                    <C>           <C>             <C>            <C>             <C>              <C>
Land                                   $  18,943     $     0         $ 18,943       $  19,864       $      0         $  19,864
Land improvements                          7,828           0            7,828           7,907              0             7,907
Buildings                                114,428         395          114,823         112,229            395           112,624
Machinery and equipment                  307,890         936          308,826         296,658            827           297,485
Construction in progress                  14,499           0           14,499          19,507              0            19,507
                                       ---------     -------         --------       ---------       --------         ---------
                                         463,588       1,331          464,919         456,165          1,222           457,387
Less accumulated depreciation           (115,856)       (704)        (116,560)        (89,568)          (564)          (90,132)
                                       ---------     -------         --------       ---------       --------         ---------
Net                                    $ 347,732     $   627         $348,359       $ 366,597       $    658         $ 367,255
                                       =========     =======         ========       =========       ========         =========

Obligations under capital leases1                    $   738                                        $    776
Less current portion                                    (218)                                           (208)
                                                     -------                                        --------
Long-term portion                                    $   520                                        $    568
                                                     =======                                        ========

<FN>
1  Represents the present value of net minimum lease payments  calculated at the
   Cooperative's  incremental  borrowing  rate at the  inception  of the leases,
   which ranged from 6.3 to 9.8 percent.
</FN>
</TABLE>

Interest capitalized in conjunction with construction  amounted to approximately
$691,000, $259,000, and $248,000 in fiscal 2000, 1999, and 1998, respectively.

The following is a schedule of future minimum lease  payments  together with the
present value of the minimum lease payments related to capitalized  leases, both
as of June 24, 2000:

(Dollars in Thousands)

 Fiscal Year Ending Last                   Capital    Operating    Total Future
       Saturday In June                    Leases       Leases      Commitment
 ----------------------------              -------    -----------  ------------
        2001                               $   294     $  8,621      $  8,915
        2002                                   222        6,265         6,487
        2003                                   147        5,036         5,183
        2004                                   121        2,559         2,680
        2005                                    89        1,925         2,014
    Later years                                 35       10,954        10,989
                                           -------     --------      --------
 Net minimum lease payments                    908     $ 35,360      $ 36,268
                                                       ========      ========
 Less amount representing interest            (170)
                                           -------
 Present value of minimum lease payments   $   738
                                           =======

Total rent expense related to operating leases (including lease  arrangements of
less than one year which are not  included in the  previous  table)  amounted to
$18,671,000, $15,352,000, and $12,250,000 for fiscal years 2000, 1999, and 1998,
respectively.


<PAGE>
NOTE 5.       DEBT

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

<TABLE>
(Dollars in Thousands)
<CAPTION>
                                                                   June 24, 2000                          Total
                                                 --------------------------------------------            June 26,
                                                   Agrilink        AgriFrozen         Total                1999
                                                 ------------      ----------       ---------          -----------
<S>                                              <C>                 <C>            <C>                <C>
Bank Debt                                        $   428,300         $ 30,000       $  458,300         $   476,600
Senior Subordinated Notes                            200,015                0          200,015             200,015
Subordinated Promissory Notes (net of discount)       26,144            4,493           30,637              27,378
Other                                                  6,836                0            6,836               6,999
                                                 -----------         --------       ----------         -----------
Total Debt                                           661,295           34,493          695,788             710,992
Less Current Portion                                 (16,583)               0          (16,583)             (8,670)
                                                 -----------         --------       ----------         -----------
Total Long-Term Debt                             $   644,712         $ 34,493       $  679,205         $   702,322
                                                 ===========         ========       ==========         ===========
</TABLE>
AGRILINK FOODS DEBT

New Credit  Facility  (Bank  Debt):  In  connection  with the DFVC  Acquisition,
Agrilink  Foods  entered  into  the New  Credit  Facility  with  Harris  Bank as
Administrative  Agent and Bank of Montreal as Syndication Agent, and the lenders
thereunder.  The New Credit Facility consists of a $200 million Revolving Credit
Facility  and a $455  million  Term Loan  Facility.  The Term Loan  Facility  is
comprised of the Term A Facility, which has a maturity of five years, the Term B
Facility,  which has a maturity of six years, and the Term C Facility, which has
a maturity of seven years.  The Revolving Credit Facility has a maturity of five
years.  All previous bank debt was repaid in  conjunction  with the execution of
the New Credit Facility.

The New Credit  Facility  bears  interest,  at Agrilink  Foods'  option,  at the
Administrative  Agent's alternate base rate or the London Interbank Offered Rate
("LIBOR")  plus,  in  each  case,  applicable  margins  of:  (i) in the  case of
alternate base rate loans, (x) 1.00 percent for loans under the Revolving Credit
Facility  and the Term A Facility,  (y) 2.75  percent for loans under the Term B
Facility  and (z) 3.00  percent for loans under the Term C Facility  and (ii) in
the case of LIBOR loans,  (x) 2.75 percent for loans under the Revolving  Credit
Facility  and the Term A Facility,  (y) 3.75  percent for loans under the Term B
Facility  and (z)  4.00  percent  for  loans  under  the  Term C  Facility.  The
Administrative  Agent's  "alternate base rate" is defined as the greater of: (i)
the prime commercial rate as announced by the  Administrative  Agent or (ii) the
Federal Funds rate plus 0.50 percent. The fiscal 2000  weighted-average  rate of
interest  applicable to the Term Loan  Facility was 9.51  percent.  In addition,
Agrilink  Foods pays a commitment  fee  calculated at a rate of 0.50 percent per
annum  on the  daily  average  unused  commitment  under  the  Revolving  Credit
Facility.

Utilizing  outstanding  balances  at June 24,  2000,  the Term Loan  Facility is
subject to the following amortization schedule:

(Dollars in Millions)

Fiscal Year   Term Loan A   Term Loan B     Term Loan C       Total
-----------   -----------   -----------     -----------       -----

    2001        $  10.0        $  0.4         $   0.4        $  10.8
    2002           10.0           0.4             0.4           10.8
    2003           10.0           0.4             0.4           10.8
    2004            9.2           0.4             0.4           10.0
    2005            0.0         190.5             0.4          190.9
    2006            0.0           0.0           195.0          195.0
                -------        ------         -------        -------
                $  39.2        $192.1         $ 197.0        $ 428.3
                =======        ======         =======        =======

The Term  Loan  Facility  is  subject  to  mandatory  prepayment  under  various
scenarios as defined in the New Credit  Facility.  During fiscal 2000,  Agrilink
Foods made  mandatory  prepayments of $10.0 million from proceeds of the sale of
the Cambria facility and the pickle operations.  In addition, during fiscal 2000
principal payments of $8.3 million were made on the Term Loan facilities.

Agrilink Foods'  obligations under the New 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 certain of Pro-Fac's
(excluding  AgriFrozen),  current  and  future  subsidiaries  and  (iii)  all of
Agrilink  Foods'  rights  under  the  agreement  to  acquire  DFVC  (principally
indemnification  rights) and the Marketing and  Facilitation  Agreement  between
Agrilink Foods and Pro-Fac.  Agrilink  Foods'  obligations  under the New Credit
Facility  are  guaranteed  by  Pro-Fac  (excluding  AgriFrozen)  and  certain of
Agrilink Foods' subsidiaries.
<PAGE>


The New  Credit  Facility  contains  customary  covenants  and  restrictions  on
Agrilink  Foods'  ability to engage in certain  activities,  including,  but not
limited to: (i)  limitations on the incurrence of indebtedness  and liens,  (ii)
limitations on sale-leaseback  transactions,  consolidations,  mergers,  sale of
assets,  transactions  with affiliates and investments and (iii)  limitations on
dividend  and  other  distributions.  The  New  Credit  Facility  also  contains
financial   covenants   requiring   Pro-Fac  to  maintain  a  minimum  level  of
consolidated EBITDA, a minimum  consolidated  interest coverage ratio, a minimum
consolidated fixed charge coverage ratio, a maximum consolidated  leverage ratio
and a minimum level of consolidated net worth.  Under the Credit Agreement,  the
assets,   liabilities,   and  results  of  operations  of  AgriFrozen   are  not
consolidated  with  Pro-Fac for  purposes  of  determining  compliance  with the
covenants.  In August of 1999,  Pro-Fac  negotiated an amendment to the original
covenants.  In  conjunction  with  this  amendment,  Pro-Fac  incurred  a fee of
approximately $2.6 million.  This fee is being amortized over the remaining life
of the New Credit  Facility.  Pro-Fac and Agrilink Foods are in compliance  with
all covenants,  restrictions and requirements  under the terms of the New Credit
Facility as amended.

Interest  Rate  Protection  Agreements:   Agrilink  Foods  has  entered  into  a
three-year  interest  rate  swap  agreement  with  the Bank of  Montreal  in the
notional  amount of $150 million.  The swap  agreement  provides for an interest
rate of 4.96  percent  over the term of the swap  payable by  Agrilink  Foods in
exchange for payments at the published three-month LIBOR. In addition,  Agrilink
Foods  entered into a separate  interest  rate swap  agreement  with the Bank of
Montreal in the notional  amount of $100 million for an initial  period of three
years.  This swap  agreement  provides for an interest rate of 5.32 percent over
the term of the swap,  payable by Agrilink Foods in exchange for payments at the
published  three-month  LIBOR.  Agrilink Foods entered into these  agreements in
order to manage its interest rate risk by exchanging  its floating rate interest
payments for fixed rate interest payments.

Agrilink  Foods had a two-year  option to extend the maturity date on one of the
interest rate swap agreements with a notional amount of $100,000,000. On June 8,
1999,  Agrilink  Foods sold this  option to Bank of Montreal  for  approximately
$2,050,000.  The gain  resulting  from the  sale is  being  recognized  over the
remaining interest rate swap life.

Senior  Subordinated  Notes - 11-7/8  Percent  (due  2008):  To  extinguish  the
Subordinated  Bridge Facility,  Agrilink Foods issued Senior  Subordinated Notes
("New Notes") for $200 million aggregate  principal amount due November 1, 2008.
Interest on the New 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 New  Notes  represent  general  unsecured  obligations  of  Agrilink  Foods,
subordinated  in right of payment to certain other debt  obligations of Agrilink
Foods (including Agrilink Foods' obligations under the New Credit Facility). The
New Notes are guaranteed by Pro-Fac and certain of Agrilink Foods' subsidiaries.

The New Notes contain  customary  covenants and  restrictions on Agrilink Foods'
ability to engage in certain  activities,  including,  but not  limited  to: (i)
limitations on the incurrence of  indebtedness  and liens;  (ii)  limitations on
consolidations,  mergers,  sales of assets,  transactions  with affiliates;  and
(iii)  limitations  on dividends and other  distributions.  Agrilink Foods is in
compliance  with all covenants,  restrictions,  and  requirements  under the New
Notes.

Subordinated Bridge Facility:  To complete the DFVC Acquisition,  Agrilink Foods
entered into a  Subordinated  Bridge  Facility (the "Bridge  Facility").  During
November  1998,  the net proceeds from the sale of the New Notes,  together with
borrowings  under  the  Revolving  Credit  Facility,  were used to repay all the
indebtedness  outstanding  ($200 million plus accrued interest) under the Bridge
Facility.  The  outstanding  indebtedness  under  the  Bridge  Facility  accrued
interest at an approximate rate per annum of 10 1/2 percent. Debt issuance costs
associated with the Bridge Facility of $5.5 million were fully amortized  during
the second quarter of fiscal 1999.

Dean Foods Subordinated  Promissory Note: As partial  consideration for the DFVC
Acquisition,  Agrilink  Foods  issued to Dean Foods the Dean Foods  Subordinated
Promissory  Note for $30 million  aggregate  principal  amount due  November 22,
2008.  Interest on the note is accrued quarterly in arrears commencing  December
31, 1998,  at a rate per annum of 5 percent  until  November 22, 2003,  and at a
rate of 10 percent thereafter.  As the stated rates on the note are below market
value,  Agrilink  Foods  has  imputed  the  appropriate  discount  utilizing  an
effective  interest rate of 11-7/8 percent.  Interest  accruing through November
22, 2003 is required to be paid in kind through the  issuance by Agrilink  Foods
of additional  subordinated  promissory  notes  identical to the note.  Agrilink
Foods  satisfied  this  requirement  through  the  issuance  of  six  additional
promissory notes each for  approximately  $0.4 million.  Interest accruing after
November  22,  2003 is  payable in cash.  The notes may be  prepaid at  Agrilink
Foods' option without premium or penalty.

The note is expressly  subordinate to the New Credit  Facility and the New Notes
and contains no financial covenants. The note is guaranteed by Pro-Fac.

<PAGE>
Senior  Subordinated  Notes  -  12  1/4  Percent  Due  2005  ("Old  Notes"):  In
conjunction with the DFVC Acquisition,  Agrilink Foods repurchased  $159,985,000
principal  amount of its Old Notes,  of which $160 million  aggregate  principal
amount was previously outstanding.  Agrilink Foods paid a total of approximately
$184 million to repurchase the Old Notes,  including interest accrued thereon of
$2.9  million.  Holders who  tendered  consented  to certain  amendments  to the
indenture relating to the Old Notes,  which eliminated or amended  substantially
all the  restrictive  covenants and certain events of default  contained in such
indenture.  Agrilink  Foods may repurchase the remaining Old Notes in the future
in open market transactions, privately negotiated purchases or otherwise.

Revolving  Credit Facility ("Notes  Payable"):  Borrowings under Agrilink Foods'
Revolving Credit Facility (excluding AgriFrozen) were as follows:

<TABLE>
(Dollars in Thousands)
<CAPTION>

                                                                 Fiscal Years Ended
                                                   June 24, 2000    June 26, 1999    June 27, 1998
                                                   -------------    -------------    -------------
<S>                                                  <C>              <C>               <C>
Balance at end of period                             $   5,700        $  18,900         $     0
Rate at fiscal year end                                 9.375%              8.2%            0.0%
Maximum outstanding during the period                $ 156,100        $ 116,200         $66,000
Average amount outstanding during the period         $  90,800        $  76,700         $51,300
Weighted average interest rate during the period          8.5%              7.8%            7.0%
</TABLE>

Agrilink Foods also maintains a Letter of Credit Facility which provides for the
issuance of letters of credit through September 2000. As of June 24, 2000, there
were $14.2  million of letters  of credit  outstanding.  Management  anticipates
timely renewals of the Letter of Credit facilities.

Other Debt:  Other debt of $6.8 million  carries  rates up to 10 percent at June
24, 2000.


Maturities:  Total long-term debt maturities during each of the next five fiscal
years for debt  associated  with  Agrilink  Foods are as  follows:  2001,  $16.6
million;  2002,  $11.2 million;  2003, $11.1 million;  2004, $10.3 million;  and
2005, $190.6 million. Provisions of the Term Loan require annual payments on the
last day of each  September of each year  (commencing  September 30, 1999) in an
amount equal to the "annual cash sweep"  (equivalent to approximately 75 percent
of net income  adjusted for certain cash and non-cash  items) for the  preceding
fiscal  year.  As of June  24,  2000,  there  were  no  obligations  under  this
provision.  Provisions  of the Term Loan  Facility  also  require  that net cash
proceeds from the sale of businesses be applied to the Term Loan Facility.

Fair  Value:  The  estimated  fair  value  of  Agrilink  Foods'  long-term  debt
outstanding was approximately $615.5 million and $673.7 million at June 24, 2000
and June 26, 1999, respectively. The fair value for long-term debt was estimated
using either quoted market prices for the same or similar  issues or the current
rates offered to Agrilink Foods for debt with similar maturities.

AGRIFROZEN DEBT

CoBank Credit  Facility  (Bank Debt):  In  connection  with the  acquisition  of
Agripac's frozen vegetable processing business, AgriFrozen entered into a CoBank
credit facility with CoBank, ACB ("CoBank"). The CoBank Credit Facility consists
of a $30 million Term Loan  Facility  and a Revolving  Credit  Facility  both of
which mature on June 29, 2002. The Revolving  Credit Facility  commitment is $55
million for fiscal 2000 and in each year thereafter it is $50 million.

The CoBank term loan facility bears interest, at the option of AgriFrozen,  at a
fixed or variable rate. The fixed rate  represents the CoBank cost of funds plus
4.19 percent. The variable rate is CoBank's "National Variable Rate," which is a
reference rate  established by CoBank.  In addition,  AgriFrozen is obligated to
pay a  commitment  fee  calculated  at a rate of 0.50  percent  per annum on the
amount by which the CoBank  revolving  credit  facility  commitment  exceeds the
greater of (i) $50 million or (ii) the average daily  aggregate of the revolving
credit facility  advances.  There is an interest cap, which includes the fees on
the CoBank Revolving Credit Facility. The interest rate cap was $1.9 million for
the initial period ending June 26, 1999 and is $5.5 million for each  subsequent
fiscal year.

AgriFrozen's  obligations under the CoBank Credit Facility are collateralized by
a first-priority  lien on  substantially  all existing or after acquired assets,
tangible or intangible, of AgriFrozen.


<PAGE>


AgriFrozen's  obligations under the CoBank Credit Facility are not guaranteed by
Pro-Fac or  Agrilink  Foods and are  expressly  nonrecourse  as to  Pro-Fac  and
Agrilink Foods.

The CoBank Credit  Facility  contains  customary  covenants and  restrictions on
AgriFrozen's ability to engage in certain activities, including, but not limited
to:  (i)  limitations  on  the  incurrence  of  indebtedness  and  liens,   (ii)
limitations  on  consolidations,  mergers,  sale  of  assets,  acquisitions  and
transactions  with  affiliates and third parties (iii)  limitations on dividends
and  other  distributions  and (iv)  limitations  on  capital  expenditures  and
administrative  expenses.  The CoBank Credit  Facility  also contains  financial
covenants  that are effective  beginning in fiscal 2000.  The covenants  require
AgriFrozen to maintain a minimum level of EBITDA and a maximum  leverage  ratio.
AgriFrozen is in compliance  with or has obtained  waivers or amendments for its
covenants,  restrictions,  and requirements under the terms of the CoBank Credit
Facility.

CoBank   Subordinated   Promissory  Note:  As  partial   consideration  for  the
acquisition of Agripac's frozen vegetable processing business, AgriFrozen issued
to CoBank the CoBank  Subordinated  Promissory  Note for $12  million  aggregate
principal  amount.  Interest  on  the  note  is  payable  quarterly  in  arrears
commencing  February  22, 2004 until  February 22, 2009 at a rate per annum of 5
percent, and at a rate of 7 percent thereafter.  As the stated rates on the note
are  below  market  value,  AgriFrozen  has  imputed  the  appropriate  discount
utilizing an effective  interest rate of 13 percent.  Interest  accruing for the
period from February 22, 2004 until February 22, 2009 is payable in kind through
the issuance by AgriFrozen of additional subordinated promissory notes identical
to the note. Quarterly principal payments are due commencing March 31, 2009 each
equal to 1/40 of the principal  balance on March 31, 2009 with a final  lump-sum
payment due February 22, 2014.  The note may be prepaid at  AgriFrozen's  option
without premium or penalty.

The note is expressly  subordinate  to the CoBank Credit  Facility.  The note is
collateralized by the assets of AgriFrozen,  but it is not guaranteed by Pro-Fac
or Agrilink  Foods and is  expressly  non-recourse  as to Pro-Fac  and  Agrilink
Foods.

Revolving  Credit Facility  ("Notes  Payable"):  Borrowings  under  AgriFrozen's
Revolving Credit Facility were as follows:


(Dollars in Thousands)

                                                        Fiscal Years Ended
                                                 June 24, 2000     June 26, 1999

Balance at end of period                           $  44,100         $  36,000
Rate at fiscal year end                                11.00%             9.25%
Maximum outstanding during the period              $  51,000         $  36,970
Average amount outstanding during the period       $  42,482         $  11,548
Weighted average interest rate during the period       10.01%             9.25%

Fair Value: The estimated fair value of AgriFrozen's  long-term debt outstanding
was  approximately  $34.5 and $34.0  million at June 24, 2000 and June 26, 1999,
respectively.  The fair value for long-term debt was estimated using the current
rates offered to AgriFrozen for debt with similar maturities.


<PAGE>


NOTE 6.       TAXES ON INCOME

Taxes on income before extraordinary item include the following:

(Dollars in Thousands)

                                     Fiscal Years Ended
                        June 24, 2000   June 26, 1999      June 27, 1998

Federal -
  Current                 $ (4,929)         $12,781          $  6,214
  Deferred                  12,734            8,972             1,201
                           --------         -------          --------
                             7,805           21,753             7,415
State and foreign -
  Current                     (210)           2,016               874
  Deferred                     902              977              (449)
                           --------         -------          --------
                               692            2,993               425
                           --------         -------          --------
                           $ 8,497          $24,746          $  7,840
                           ========         =======          ========

A reconciliation  of the consolidated  effective tax rate to the amount computed
by applying the federal income tax rate to income before taxes and extraordinary
item is as follows:

<TABLE>
                                                                          Fiscal Years Ended
                                                                   --------------------------------
                                                                   June 24,    June 26,    June 27,
                                                                     2000        1999        1998
                                                                   --------    --------    --------

<S>                                                                  <C>        <C>          <C>
Statutory federal rate                                               35.0%      35.0%        35.0%
State and foreign income taxes, net of federal income tax effect      2.9        3.5          2.3
Allocation to members                                                (7.0)       0.0         (8.6)
Goodwill amortization                                                 5.1        5.9          3.9
Dividend received deduction                                          (0.2)      (0.4)        (1.2)
Other, net                                                           (1.4)      (1.4)         0.0
                                                                     ----       ----         ----
Effective Tax Rate                                                   34.4%      42.6%        31.4%
                                                                     ====       ====         ====
</TABLE>



<PAGE>


The consolidated deferred tax (liabilities)/assets consist of the following:

(Dollars in Thousands)

                                                  June 24, 2000   June 26, 1999

Liabilities:
   Depreciation                                   $  (41,033)      $  (28,468)
   Goodwill and other intangible assets               (5,796)          (1,379)
   Prepaid manufacturing expense                     (10,152)          (7,086)
   Prepaid expenses and other current assets               0           (1,672)
   Investment in Great Lakes Kraut Company, LLC       (1,727)          (1,892)
   Discount on Subordinated Promissory Notes          (5,208)          (2,882)
                                                  ----------       ----------
                                                     (63,916)         (43,379)
                                                  ----------       ----------
Assets:
   Non-qualified retains                                 105              697
   Inventories                                        12,922            9,182
   Credits and operating loss carryforwards            7,820            1,538
   Accrued employee compensation                       1,795            5,316
   Insurance accruals                                  3,259            4,422
   Pension/OPEB accruals                              10,752            7,353
   Restructuring reserve                                 661            1,556
   Promotional reserves                                  371              867
   Other                                               7,334            6,945
                                                  ----------       ----------
                                                      45,019           37,876
                                                  ----------       ----------
   Net deferred liabilities                          (18,897)          (5,503)
   Valuation allowance                                (5,752)          (1,409)
                                                  ----------       ----------
                                                  $  (24,649)      $   (6,912)
                                                  ==========       ==========

During fiscal 2000,  the  Cooperative  increased the valuation  allowance in the
amount of $4.3 million.  This valuation allowance was primarily  established for
state net  operating  losses  and  credits  generated  during  the year.  As the
Cooperative  cannot assure that  realization is more likely than not to occur, a
valuation allowance has been recorded.

During fiscal 1999,  Agrilink  Foods  utilized the $5.5 million of net operating
loss  carryforwards  ($1.9 million of tax). The benefits for these net operating
losses had been recorded in previous years.

In January 1995, the Boards of Directors of Agrilink Foods and Pro-Fac  approved
appropriate  amendments to the Bylaws of Agrilink  Foods to allow Agrilink Foods
to qualify as a cooperative  under Subchapter T of the Internal Revenue Code. In
August 1995,  Agrilink  Foods and Pro-Fac  received a favorable  ruling from the
Internal  Revenue  Service  approving the change in tax treatment  effective for
fiscal 1996.  This ruling also  confirmed  that the change in Agrilink Foods tax
status would have no effect on  Pro-Fac's  ongoing  treatment  as a  cooperative
under Subchapter T of the Internal Revenue Code of 1986.

NOTE 7.       PENSIONS, PROFIT SHARING, AND OTHER EMPLOYEE BENEFITS

Pensions:  The Cooperative has primarily  noncontributory  defined benefit plans
covering  most  employees.  The benefits for these plans are based  primarily on
years of service and employees' pay near retirement.  The Cooperative's  funding
policy  is  consistent  with  the  funding   requirements  of  Federal  law  and
regulations.  Plan assets consist principally of common stocks,  corporate bonds
and US government obligations.

The Cooperative also  participates in several union sponsored  pension plans. It
is not possible to determine the Cooperative's relative share of the accumulated
benefit obligations or net assets for these plans.


<PAGE>


Pension  cost for  fiscal  years  ended  2000 and 1999  includes  the  following
components:

<TABLE>
(Dollars in Thousands)
<CAPTION>

                                                                                Pension Benefits
                                                                                Fiscal Years Ended
                                                                          June 24, 2000     June 26, 1999
<S>                                                                        <C>               <C>
Change in benefit obligation:
   Benefit obligation at beginning of period                               $  110,833        $  101,504
   Service cost                                                                 6,520             4,727
   Interest cost                                                                7,592             6,953
   Plan participants' contributions                                               160               242
   Amendments                                                                   2,296                 0
   Actuarial (gain)/loss                                                      (16,122)            4,976
   Benefits paid                                                               (9,584)           (7,569)
                                                                           ----------        ----------
     Benefit obligation at end of period                                      101,695           110,833
                                                                           ----------        ----------
Change in plan assets:
   Fair value of assets at beginning of period                                108,183           107,253
   Actual return on plan assets                                                12,941             8,000
   Employer contribution                                                          256               257
   Plan participants' contributions                                               160               242
   Benefits paid                                                               (9,584)           (7,569)
                                                                           ----------        ----------
     Fair value of assets at end of period                                    111,956           108,183
                                                                           ----------        ----------
Plan funded status:                                                            10,261            (2,650)
   Unrecognized prior service cost                                              2,181              (131)
   Unrecognized actuarial gain                                                (29,217)          (10,810)
   Union plans                                                                      0               (31)
                                                                           ----------        ----------
     Accrued benefit liability prior to additional minimum liability          (16,775)          (13,622)
Amounts recognized in the statement of financial position consist of:
   Accrued benefit liability                                                  (17,300)          (14,385)
   Accumulated other comprehensive income                                         525               763
                                                                           ----------        ----------
     Net amount recognized                                                 $  (16,775)       $  (13,622)
                                                                           ==========        ==========

Weighted-average assumptions:
   Discount rate                                                                  8.0%              7.0%
   Expected return on plan assets                                                 9.5%             10.0%
   Rate of compensation increase                                                  4.5%              4.5%
</TABLE>

<TABLE>
                                                                                  Pension Benefits
                                                                  --------------------------------------------------
                                                                                 Fiscal Years Ended
                                                                  --------------------------------------------------
                                                                  June 24, 2000     June 26, 1999      June 27, 1998
                                                                  -------------     -------------      -------------
Components of net periodic benefit cost:
<CAPTION>

   <S>                                                                <C>             <C>                <C>
   Service cost                                                       $  6,520        $   4,727          $ 2,796
   Interest cost                                                         7,592            6,953            6,776
   Expected return on plan assets                                      (10,604)         (10,528)          (8,708)
   Amortization of prior service cost                                      (16)             (15)             (22)
   Amortization of gain                                                    (51)            (741)            (593)
   Union costs                                                              37               81               88
                                                                      --------        ---------          -------
   Net periodic cost                                                  $  3,478        $     477          $   337
                                                                      ========        =========          =======
</TABLE>

The Cooperative maintains a non-tax qualified  Supplemental Executive Retirement
Plan which provides  additional  retirement benefits to two prior executives who
retired prior to November 4, 1994.

On January 28, 1992,  the  Cooperative  adopted a  Non-Qualified  Excess Benefit
Retirement  Plan which  serves to  provide  employees  with the same  retirement
benefit they would have received from Agrilink Foods'  retirement plan under the
career  average base pay formula,  but for changes  required  under the 1986 Tax
Reform Act and the  compensation  limitation  under  Section  401(a)(17)  of the
Internal Revenue Code having been revised in the 1992 Omnibus Budget Reform Act.


<PAGE>
The projected benefit obligation,  accumulated benefit obligation and fair value
of plan  assets for the two  non-qualified  retirement  plans  with  accumulated
benefit obligations in excess of plan assets were:

<TABLE>
(Dollars in Thousands)
<CAPTION>

                                    Supplemental Executive Retirement Plan            Excess Benefit Retirement Plan
                                    ---------------------------------------         -----------------------------------
                                              Fiscal Years Ended                            Fiscal Years Ended
                                    ---------------------------------------         -----------------------------------
                                    June 24, 2000           June 26, 1999           June 24, 2000         June 26, 1999
                                    -------------           -------------           -------------         -------------

<S>                                   <C>                     <C>                      <C>                  <C>
Projected benefit obligation          $ 1,729                 $  1,895                 $  1,159             $  1,128
Accumulated benefit obligation          1,729                    1,895                      834                  855
Plan assets                                 0                        0                        0                    0
</TABLE>

Postretirement Benefits Other Than Pensions: Generally, other than pensions, the
Cooperative  does not pay retirees'  benefit costs.  Various  exceptions  exist,
which have evolved from union  negotiations,  early  retirement  incentives  and
existing retiree commitments from acquired companies.

The  Cooperative  has not prefunded any of its retiree medical or life insurance
liabilities. Consequently there are no plan assets held in a trust, and there is
no expected  long-term rate of return assumption for purposes of determining the
annual expense.

The plan's funded status was as follows:

<TABLE>
(Dollars in Thousands)
<CAPTION>

                                                                                        Other Benefits
                                                                                      Fiscal Years Ended
                                                                          June 24, 2000              June 26, 1999

<S>                                                                        <C>                          <C>
Change in benefit obligation:
   Benefit obligation at beginning of period                               $    6,507                   $    2,758
   Service cost                                                                   184                           90
   Interest cost                                                                  433                          250
   (Decrease due to sale)/increase due to acquisition                            (295)                       2,065
   Actuarial (gain)/loss                                                         (715)                       1,932
   Benefits paid                                                                 (456)                        (588)
                                                                           ----------                   ----------
     Benefit obligation at end of period                                        5,658                        6,507
                                                                           ----------                   ----------
Change in plan assets:
   Fair value of assets at beginning of period                                      0                            0
   Employer contribution                                                          456                          588
   Benefits paid                                                                 (456)                        (588)
                                                                           -----------                  ----------
     Fair value of assets at end of period                                          0                            0
                                                                           ----------                   ----------
Plan funded status:                                                            (5,658)                      (6,507)
   Unrecognized actuarial loss                                                    717                        1,886
                                                                           ----------                   ----------
     Accrued benefit liability                                                 (4,941)                      (4,621)
Amounts recognized in the statement of financial position consist of:

   Accrued benefit liability                                                   (4,941)                      (4,621)
                                                                           ----------                   ----------
     Net amount recognized                                                 $   (4,941)                  $   (4,621)
                                                                           ==========                   ==========

Weighted-average assumptions:
   Discount rate                                                                  8.0%                         7.0%
   Expected return on plan assets                                                  N/A                          N/A
   Rate of compensation increase                                                  4.5%                         4.5%
</TABLE>
<PAGE>
<TABLE>

                                                                                          Other Benefits
                                                                        --------------------------------------------------
                                                                        June 24, 2000     June 26, 1999       June 27, 1998
                                                                        -------------     -------------       -------------
<S>                                                                       <C>                <C>                <C>
Components of net periodic benefit cost:
   Service cost                                                           $     184          $     90           $       6
   Interest cost                                                                433               250                 198
   Amortization of loss/(gain)                                                  159                 0                 (10)
                                                                          ---------          --------           ----------
   Net periodic cost                                                      $     776          $    340           $     194
                                                                          =========          ========           =========
</TABLE>
For measurement purposes, an 8.5 percent rate of increase in the per capita cost
of covered  health  care  benefits  was assumed  for fiscal  2000.  The rate was
assumed to decrease  gradually  to 5.0 percent for 2007 and remain at that level
thereafter.

The Cooperative sponsors benefit plans that provide  postretirement  medical and
life insurance  benefits for certain current and former employees.  For the most
part,  current  employees  are  not  eligible  for  the  postretirement  medical
coverage.  As such,  the assumed  health care trend rates have an  insignificant
effect  on  the  amounts   reported  for  the   postretirement   benefits  plan.
One-percentage  point  change in the assumed  health care trend rates would have
the following effect:
<TABLE>
                                                               1-Percentage       1-Percentage
                                                              Point Increase     Point Decrease

<S>                                                            <C>                <C>
Effect on total of service and interest cost components        $   47,913         $   (43,868)
Effect on postretirement benefit obligation                    $  283,765         $  (260,670)
</TABLE>
Retirement  Savings  and  Incentive  Plan:  Under  the  Retirement  Savings  and
Incentive Plan ("RSIP"),  the Cooperative makes an incentive contribution to the
RSIP if certain  pre-established  earnings goals are achieved. In addition,  the
Cooperative  contributes  401(k)  matching  contributions  to the  plan  for the
benefit of employees who elect to defer a portion of their salary into the plan.
During  fiscal 2000,  1999,  and 1998,  the  Cooperative  allocated  $1,076,000,
$888,000, and $475,000,  respectively, in the form of matching contributions and
$0, $0, and $400,000,  respectively,  in the form of incentive contributions for
the benefit of its employees.

In addition,  Agrilink Foods also maintains a Non-qualified  Retirement  Savings
Plan in which the Cooperative  allocates matching  contributions for the benefit
of  "highly  compensated  employees"  as  defined  under  Section  414(q) of the
Internal  Revenue Code.  During fiscal 2000,  1999,  and 1998,  the  Cooperative
allocated $243,000,  $208,000, and $131,000 respectively in the form of matching
contributions to this plan.

Long-Term  Incentive  Plan:  On June 24,  1996,  the  Cooperative  introduced  a
long-term incentive program,  the Agrilink Foods Equity Value Plan, which it has
amended from time to time. The Equity Value Plan provides performance units to a
select  group  of  management.  The  future  value of the  performance  units is
determined by the Company's performance on earnings and debt repayment.

Units  issued in 1996  through  1999 vest 25  percent  each year after the first
anniversary of the grant,  becoming 100 percent vested on the fourth anniversary
of grant. For units granted in 1996, the appreciated value of units in excess of
the initial grant price is paid as cash compensation on the tenth anniversary of
grant. The total units granted in 1996 were 248,511 at $13.38. For units granted
in 1997, 1998 and 1999, the final value of the  performance  units is determined
on the fourth anniversary of grant.  One-third of the appreciated value of units
in excess of the initial grant price is paid as cash  compensation  over each of
the subsequent  three years. The total units granted from 1997 through 1999 were
402,715  at $26.00 per unit in 1999,  308,628  at $21.88  per unit in 1998,  and
176,278 at $25.04 per unit in 1997.

For  units  granted  in  2000,  the  final  value  of the  performance  units is
discretionary.  Units granted in 2000 vest 100 percent on the fourth anniversary
of grant. The total units granted in 2000 were 371,806.

Units forfeited  since the inception of the plan include 8,731 at $26.00,  9,418
at $21.88, 18,362 at $25.04, and 27,165 at $13.38.

The value of the grants from the Agrilink  Foods Equity Value Plan will be based
on Agrilink's future earnings and debt repayment.

Employee Stock Purchase Plan:  During fiscal 1996 the Cooperative  introduced an
Employee Stock Purchase Plan which affords employees the opportunity to purchase
semi-annually,  in cash or via payroll  deduction,  shares of Class B Cumulative
Pro-Fac Preferred Stock to a maximum value of 5 percent of salary.  The purchase
price of such shares is par value, $10 per share.  During fiscal 2000, 1999, and
1998, 23,664, 26,061, and 27,043 shares,  respectively,  were held by employees,
and there were no shares subscribed to as of June 24, 2000.
<PAGE>
NOTE 8.       OPERATING SEGMENTS

During fiscal 1999, the Cooperative  adopted  Statement of Financial  Accounting
Standards No. 131,  "Disclosures  about Segments of an  Enterprise"  (SFAS 131).
SFAS No. 131 establishes  requirements for reporting information about operating
segments and establishes  standards for related  disclosures  about products and
services,  and  geographic  areas.  SFAS No.  131 also  replaces  the  "industry
segment"  approach  with the  "management"  approach.  The  management  approach
designates  the  internal  organization  that is used by  management  for making
operating  decisions  and  assessing  performance  as the  source of  reportable
segments. As management makes the majority of its operating decisions based upon
the  Cooperative's  significant  product lines,  The  Cooperative has elected to
utilize  significant  product lines in determining its operating  segments.  The
Cooperative's four primary operating segments are as follows: vegetables, fruit,
snacks, and canned meals.

The  vegetable  product  line  consists of canned and frozen  vegetables,  chili
beans,  and  various  other  products.  Branded  products  within the  vegetable
category include Birds Eye, Birds Eye Voila!, Freshlike, Veg-All, McKenzies, and
Brooks Chili Beans.  The fruit product line consists of canned and frozen fruits
including  fruit  fillings  and  toppings.  Branded  products  within  the fruit
category  include  Comstock and  Wilderness.  The snack product line consists of
potato chips,  popcorn and other corn-based snack items. Branded products within
the snacks category include Tim's Cascade Chips,  Snyder of Berlin,  Husman,  La
Restaurante, Erin's, Beehive, Pops-Rite, Super Pop, and Flavor Destinations. The
canned meal product line includes  canned meat  products such as chilies,  stew,
and soups,  and various other  ready-to-eat  prepared  meals.  Branded  products
within the canned meals category  include Nalley.  Other product lines primarily
represent salad dressings.  Branded products within the "other category" include
Bernstein's and Nalley.

<PAGE>
<TABLE>
The following table illustrates the Cooperative's operating segment information:

(Dollars in Millions)                                                                      Fiscal Years Ended
                                                                          --------------------------------------------------
                                                                          June 24, 2000      June 26, 1999     June 27, 1998
                                                                          -------------      -------------     -------------
<S>                                                                         <C>                <C>              <C>
Net Sales:
   Vegetables                                                               $    886.6         $    763.1       $   233.1
   Fruits                                                                        110.4              111.5           119.7
   Snacks                                                                         87.3               87.9            83.7
   Canned Meals                                                                   60.3               64.2            64.0
   Other                                                                          54.5               73.0            58.6
                                                                            ----------         ----------       ---------
     Continuing segments                                                       1,199.1            1,099.7           559.1
   Businesses sold                                                                69.4              139.2           160.6
                                                                            ----------         ----------       ---------
         Total                                                              $  1,268.5         $  1,238.9       $   719.7
                                                                            ==========         ==========       =========

Operating income:
   Vegetables1                                                              $     70.8         $     46.0       $    11.5
   Fruits                                                                         13.9                8.4            17.1
   Snacks                                                                          6.7                3.3             6.1
   Canned Meals                                                                    6.7                6.5             6.8
   Other                                                                           4.6                3.7            (0.3)
                                                                            ----------         ----------       ---------
     Continuing segments operating income                                        102.7               67.9            41.2
   Businesses sold                                                                (1.2)               5.1            14.5
                                                                            ----------         ----------       ---------
         Total                                                                   101.5               73.0            55.7
Gains on sales of assets                                                           6.7               64.7             0.0
Restructuring expense                                                              0.0               (5.0)            0.0
                                                                            ----------         ----------       ---------
Total consolidated operating income                                              108.2              132.7            55.7
Interest expense                                                                 (83.5)             (67.4)          (30.7)
Amortization of debt issue costs associated with the Bridge Facility               0.0               (5.5)            0.0
                                                                            ----------         ----------       ---------
Pretax income before extraordinary item, dividends and allocation of
  net proceeds                                                              $     24.7         $     59.8       $    25.0
                                                                            ==========         ==========       =========
Total Assets:
   Vegetables                                                               $    966.2         $    974.1       $   300.8
   Fruits                                                                         79.4               90.2            87.5
   Snacks                                                                         43.5               40.9            43.1
   Canned Meals                                                                   45.7               46.2            49.8
   Other                                                                          52.2               43.1            47.4
                                                                            ----------         ----------       ---------
     Continuing segments                                                       1,187.0            1,194.5           528.6
   Businesses sold                                                                 0.0                1.1            37.9
   Assets held for sale                                                            0.3                0.9             2.7
                                                                            ----------         ----------       ---------
       Total                                                                $  1,187.3         $  1,196.5       $   569.2
                                                                            ==========         ==========       =========

Depreciation expense:
   Vegetables                                                               $     24.6         $     15.7       $     8.2
   Fruits                                                                          1.7                2.4             3.6
   Snacks                                                                          2.4                1.7             1.6
   Canned Meals                                                                    1.2                1.2             1.0
   Other                                                                           1.2                1.0             1.4
                                                                            ----------         ----------       ---------
     Continuing segments                                                          31.1               22.0            15.8
   Businesses sold                                                                 1.5                2.8             2.2
                                                                            ----------         ----------       ---------
     Total                                                                  $     32.6         $     24.8       $    18.0
                                                                            ==========         ==========       =========

Amortization Expense:
   Vegetables                                                              $       6.1         $      5.4       $     0.6
   Fruits                                                                          0.1                0.1             0.3
   Snacks                                                                          0.8                0.9             0.6
   Canned meals                                                                    0.7                0.7             0.8
   Other                                                                           0.7                0.6             0.6
                                                                           -----------         ----------       ---------
     Continuing segments                                                           8.4                7.7             2.9
   Businesses sold                                                                 0.4                1.7             0.7
                                                                           -----------         ----------       ---------
       Total                                                               $       8.8         $      9.4       $     3.6
                                                                           ===========         ==========       =========
</TABLE>
<PAGE>
<TABLE>
(Dollars in Millions)                                                                    Fiscal Years Ended
                                                                          --------------------------------------------------
                                                                          June 24, 2000      June 26, 1999     June 27, 1998
                                                                          -------------      -------------     -------------
<S>                                                                        <C>                 <C>              <C>
Capital expenditures:
   Vegetables                                                              $      21.4         $     19.5       $     8.0
   Fruits                                                                          1.6                1.3             1.5
   Snacks                                                                          2.3                2.0              1.8
   Canned Meals                                                                    1.1                0.6             0.5
   Other                                                                           0.2                0.3             0.4
                                                                           -----------         ----------       ---------
     Continuing Segments                                                          26.6               23.7            12.2
   Businesses sold                                                                 0.4                0.1             1.9
                                                                           -----------         ----------       ---------
       Total                                                               $      27.0         $     23.8       $    14.1
                                                                           ===========         ==========       =========
<FN>
1  The vegetable  product line includes  earnings  derived from Agrilink  Foods'
   investment in Great Lakes Kraut  Company,  LLC of $2.4 million,  $2.8 million
   and $1.9 million in fiscal 2000, fiscal 1999, and fiscal 1998,  respectively.
   See  NOTE  3  to  the  "Notes  to   Consolidated   Financial   Statements"  -
   "Acquisitions and Disposals - Formation of New Sauerkraut Company."
</FN>
</TABLE>
NOTE 9.       COMMON STOCK AND CAPITALIZATION

The following table illustrates the Cooperative's shares authorized, issued, and
outstanding at June 24, 2000 and June 26, 1999.
<TABLE>
                                                                                        Shares Issued and Outstanding
                                                                                              Fiscal Years Ended
                                                      Par               Shares         --------------------------------
                                                     Value            Authorized       June 24, 2000      June 26, 1999
                                                     -----            ----------       -------------      -------------

<S>                                                  <C>               <C>               <C>               <C>
Class A Common Stock                                 $ 5.00            5,000,000         2,132,981         1,995,740
Class B Common Stock                                 $ 5.00            2,000,000           723,229                 0
Non-Cumulative Preferred Stock                       $25.00            5,000,000            34,400            39,635
Class A Cumulative Preferred Stock                   $ 1.00           10,000,000         4,249,007         3,694,495
Class B Cumulative Preferred Stock                   $ 1.00            9,500,000                 0                 0
Class C Cumulative Preferred Stock                   $ 1.00           10,000,000                 0                 0
Class D Cumulative Preferred Stock                   $ 1.00           10,000,000                 0                 0
Class E Cumulative Preferred Stock                   $ 1.00           10,000,000                 0                 0
Class B, Series I 10% Cumulative Preferred Stock     $ 1.00              500,000            23,664            26,061
</TABLE>

On March 4,  1999,  the  Cooperative  authorized  up to  $15,000,000  of special
membership  interests  which shall have a stated value equal to such  interests'
face amount.

Common  Stock:  The  Common  Stock  purchased  by members is related to the crop
delivery of each member.  Regardless  of the number of shares held,  each member
has one vote. As of June 24, 2000,  there were 626 holders of the Class A Common
Stock and 150 holders of Class B Common Stock.  Common Stock may be  transferred
to another  grower only with approval of the Pro-Fac  Board of  Directors.  If a
member  ceases to be a  producer  of  agricultural  products  which is  marketed
through the  Cooperative,  then it must sell its Common Stock to another  grower
within the  members'  pool that is  acceptable  to the  Cooperative.  If no such
grower is available to purchase the stock,  then the member must sell its Common
Stock to the  Cooperative at par value.  There is no established  public trading
market for the Common Stock of the Cooperative.

In fiscal 2000,  1999, and 1998 dividends on Class A Common Stock were paid at a
rate of 5.0 percent.  There were no dividends  paid on the Class B Common Stock.
Subsequent to June 24, 2000, the Cooperative  declared a cash dividend at a rate
of 5.0  percent  on the Class A Common  Stock.  These  dividends  amounted  $0.5
million and were paid in July 2000.

At June 24, 2000 and June 26, 1999, there were outstanding subscriptions, at par
value,  of 233,977 and 384,649  shares for Class A Common  Stock,  respectively.
These shares are issued as  subscription  payments are  received.  There were no
outstanding subscriptions for the Class B Common Stock.

Preferred  Stock:  Except  for the  Class B,  Series  I, 10  Percent  Cumulative
Preferred Stock, all preferred stock outstanding  originated from the conversion
at par value of retains  at the  discretion  of  Pro-Fac's  board of  directors.
Preferred  Stock is non-voting,  except that the holders of preferred and common
stock are entitled to vote as separate  classes on certain  matters  which would
affect or subordinate the rights of the class.

On August 23, 1995, the Cooperative  commenced an offer to exchange one share of
its Class A Cumulative  Preferred Stock  (liquidation  preference $25 per share)
for each of its existing Non-cumulative  Preferred Stock (liquidation preference
$25 per share). Pro-Fac's Class
<PAGE>
A  Cumulative  Preferred  Stock is listed  under the symbol  PFACP on the Nasdaq
National  Market  System.  As of June 24, 2000, the number of Class A Cumulative
Preferred Stock record holders was 1,831.

The "Class B,  Series I, 10 Percent  Cumulative  Preferred  Stock (the  "Class B
Stock") is issued to employees  pursuant to an Employee  Stock Purchase Plan. At
least once a year,  Pro-Fac  plans to offer to  repurchase at least 5 percent of
the outstanding shares of Class B Stock.

<TABLE>
The dividend rates for the preferred stock outstanding are as follows:

<S>                                                          <C>
Non-Cumulative Preferred Stock                               $1.50 per share paid annually at the discretion of the Board.

Class A Cumulative Preferred Stock                           $1.72   per   share   annually,   paid  in   four   quarterly
                                                             installments of $.43 per share.

Class B, Series I, 10 Percent Cumulative Preferred Stock     $1.00 per share paid annually.
</TABLE>

Subsequent to June 24, 2000, the  Cooperative  declared a cash dividend of $1.50
per share on the Non-cumulative  Preferred Stock and $.43 per share on the Class
A Cumulative  Preferred Stock. These dividends amounted to $1.9 million and were
paid in July 2000.

Retained Earnings Allocated to Members ("Retains"): Retains arise from patronage
income,  and are  allocated to the accounts of members  within 8.5 months of the
end of each fiscal year.

         Qualified Retains:  Qualified retains are freely  transferable.  At the
         discretion of the Board of Directors  qualified retains may mature into
         preferred  stock  in  December  of the  fifth  year  after  allocation.
         Qualified  retains  are  taxable  income to the  member in the year the
         allocation is made.

         Non-Qualified  Retains:  Non-qualified  retains  may  not  be  sold  or
         purchased.   At  the   discretion   of  the  Board  of  Directors   the
         non-qualified  retains allocation may be redeemed in five years through
         partial  payment  in  cash  and  issuance  of  preferred   stock.   The
         non-qualified  retains will not be taxable to the member until the year
         of redemption.

         Non-qualified  retains  may be subject to later  adjustment  if such is
         deemed necessary by the Board of Directors  because of events which may
         occur after the retains were allocated.

Beginning with the retains  issued in 1995, the maturity of all future  retains,
if approved by the Board of  Directors,  will result in the  issuance of Class A
Cumulative Preferred Stock.

Earned Surplus: Earned surplus consists of accumulated income after distribution
of earnings  allocated to members,  dividends and after state and federal income
taxes.  Earned  surplus is  reinvested  in the  business in the same  fashion as
retains.

NOTE 10.      SUBSIDIARY GUARANTORS

Kennedy  Endeavors,  Incorporated  and  Linden  Oaks  Corporation,  wholly-owned
subsidiaries  of Agrilink  Foods  ("Subsidiary  Guarantors")  and Pro-Fac,  have
jointly  and  severally,  fully  and  unconditionally  guaranteed,  on a  senior
subordinated  basis,  the obligations of Agrilink Foods with respect to Agrilink
Foods' 11 7/8  percent  Senior  Subordinated  Notes due 2008 and the New  Credit
Facility.  The  covenants  in the New Notes and the New Credit  Facility  do not
restrict the ability of the Subsidiary  Guarantors to make cash distributions to
Agrilink Foods.


<PAGE>


Separate  financial  statements and other disclosures  concerning the Subsidiary
Guarantors  are not  presented  because  management  has  determined  that  such
financial  statements and other disclosures are not material.  Accordingly,  set
forth below is certain summarized  financial  information derived from unaudited
historical financial  information for the Subsidiary  Guarantors,  on a combined
basis.

(Dollars in Thousands)

                                                  Fiscal Year Ended
                                       -----------------------------------------
                                         June 24,       June 26,      June 27,
                                            2000          1999          1998
                                       -----------     ---------     ---------
Summarized Statement of Operations:

    Net sales/royalty income           $    74,163     $  33,026     $  12,086
    Gross profit                            59,072        23,641         5,123
    Income from continuing operations       59,343        20,732         1,002
    Net income                              38,575        13,401         1,002

Summarized Balance Sheet:

    Current assets                     $     3,258     $   1,759     $   2,033
    Noncurrent assets                      211,107       217,684         7,129
    Current liabilities                      6,926         8,290         1,267

NOTE 11.      OTHER MATTERS

Legal Matters: The Cooperative is party to various litigation and claims arising
in the  ordinary  course  of  business.  Management  and legal  counsel  for the
Cooperative  are of the  opinion  that none of these legal  actions  will have a
material effect on the financial position of the Cooperative.

Commitments:  Agrilink Foods has guaranteed an approximate $3.0 million loan for
Great  Lakes  Kraut  Company,  LLC in  which  Agrilink  Foods  has a 50  percent
interest.

Agrilink Foods has  guaranteed an approximate  $1.4 million loan for the City of
Montezuma to renovate a sewage  treatment  plant operated in Montezuma on behalf
of the City.

                            Pro-Fac Cooperative, Inc.

                      Quarterly Financial Data (Unaudited)

Quarterly  financial  information  for the fiscal  years ended June 24, 2000 and
June 26, 1999  appears in the  following  table.  All quarters  reflect  13-week
periods.

In the opinion of management,  all adjustments necessary for a fair presentation
of the unaudited quarterly data have been made.

<TABLE>
(Dollars in Thousands Except Per Share)
<CAPTION>

                                                                                 Quarters Fiscal 2000
                                                      1                 2                3                 4           Total Year
                                                 ----------       ----------        -----------      -----------       -----------

<S>                                              <C>             <C>                <C>              <C>               <C>
Net sales                                        $  296,248      $   380,485        $  300,880       $  290,929        $ 1,268,542
Gross profit                                     $   84,794      $   128,241        $   90,417       $   82,229        $   385,681
Income before taxes, dividends,
     and allocation of net proceeds              $    1,448      $    19,113        $    1,991       $    2,109        $    24,661
Net income                                       $      403      $    14,480        $      925       $      356        $    16,164
Cash dividends declared per share on
   Class A Cumulative Preferred Stock            $      .43      $       .43        $      .43       $      .43        $      1.72
Market price per share on Class A
   Cumulative Preferred Stock (Nasdaq)
     High                                        $   19.500      $    19.125        $   16.953       $   16.953        $    19.500
     Low                                         $   18.500      $    17.500        $   13.875       $   14.875        $    13.875
</TABLE>



<PAGE>


<TABLE>
(Dollars in Thousands Except Per Share)
<CAPTION>

                                                                                Quarters  Fiscal 1999
                                                         1                2                3                4           Total Year
                                                 ---------------  ---------------   --------------   --------------     ----------

<S>                                              <C>             <C>                <C>              <C>               <C>
Net sales                                        $  182,579      $   376,703        $  361,235       $  318,429        $ 1,238,946
Gross profit                                     $   46,697      $   122,140        $  110,388       $   82,283        $   361,508
Income before taxes, extraordinary item,
   dividends, and allocation of net proceeds     $   68,316      $     6,962        $   (1,405)      $  (14,159)       $    59,714
Net income                                       $   25,285      $     5,069        $   (2,841)      $  (10,569)       $    16,944
Cash dividends declared per share on
   Class A Cumulative Preferred Stock            $      .43      $       .43        $      .43       $      .43        $      1.72
Market price per share on Class A
   Cumulative Preferred Stock (Nasdaq)
     High                                        $   20.375      $    20.000        $    19.875       $  19.500        $    20.375
     Low                                         $   19.000      $    18.813        $    18.000       $  17.500        $    17.500
</TABLE>

ITEM 9.       CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
              FINANCIAL DISCLOSURE

Not applicable.


<PAGE>


                                    PART III

ITEM 10.      DIRECTORS AND OFFICERS

                       MANAGEMENT AND DIRECTORS OF PRO-FAC

<TABLE>
                        Date
          Name        of Birth                          Positions

<S>                     <C>        <C>
Bruce R. Fox            1947       Director and Chairman of the Board, President
Steven D. Koinzan       1948       Director and Vice Chairman of the Board, Vice President
Tom R. Croner           1942       Director
Earl L. Powers          1944       Treasurer
Stephen R. Wright       1947       Secretary and General Manager
Dale W. Burmeister      1940       Director
Peter R. Call           1956       Director
Glen Lee Chase          1937       Director
Kenneth A. Dahlstedt    1954       Director
Robert DeBadts          1957       Director
Kenneth A. Mattingly    1948       Director
Allan W. Overhiser      1960       Director
Paul E. Roe             1939       Director
Darell Sarff            1949       Director
</TABLE>

Bruce R.  Fox has  been a  Director  of  Pro-Fac  since  1974.  For  information
regarding Mr. Fox, see "Management and Directors of Agrilink Foods."

Steven D.  Koinzan has been a Director of Pro-Fac  since 1983.  For  information
regarding Mr. Koinzan, see "Management and Directors of Agrilink Foods."

Tom R. Croner has been a Director of Pro-Fac  since 1985 and a member of Pro-Fac
since 1973.  He was elected  Secretary on March 27, 1995.  Mr. Croner is a dairy
and potato farmer (T-Rich Inc.; Berlin, Pennsylvania).

Earl L.  Powers  has been an  officer of Pro-Fac  since  1997.  For  information
regarding Mr. Powers, see "Management and Directors of Agrilink Foods."

Stephen  R.  Wright has been an officer of  Pro-Fac  since  March  1995,  having
previously  served  as  Assistant  General  Manager  since  November  1994.  For
information  regarding Mr.  Wright,  see  "Management  and Directors of Agrilink
Foods."

Dale W.  Burmeister  has been a Director  of Pro-Fac  since 1992 and a member of
Pro-Fac since 1974. Mr.  Burmeister is a fruit and vegetable  grower  (Lakeshore
Farms, Inc.; Shelby, Michigan).

Peter R. Call was elected a Director of Pro-Fac in February  2000. Mr. Call is a
vegetable, fruit, and grain farmer (My-T Acres, Inc., Batavia, New York).

Glen Lee Chase has been a Director of Pro-Fac since 1989 and a member of Pro-Fac
since 1984. Mr. Chase is a peanut,  poultry,  grain and vegetable  farmer (Chase
Farms Inc.; Oglethorpe, Georgia).

Kenneth A.  Dahlstedt was elected a Director of Pro-Fac in February 1998 and has
been a member of Pro-Fac since 1983.

Robert  DeBadts was elected a Director of Pro-Fac in January 1997 and has been a
member of Pro-Fac since 1978.  Mr.  DeBadts is a fruit grower (Lake Breeze Fruit
Farms, Inc.; Sodus, New York).

Kenneth A.  Mattingly  has been a Director of Pro-Fac since 1993 and a member of
Pro-Fac  since 1978.  Mr.  Mattingly is a vegetable  and grain farmer (M-B Farms
Inc.; LeRoy, New York).

Allan W.  Overhiser has been a Director of Pro-Fac since March 1994 and a member
of Pro-Fac since 1984. Mr. Overhiser is a fruit farmer (A.W. Overhiser Orchards;
South Haven, Michigan).
<PAGE>

Paul E. Roe has been a Director  of  Pro-Fac  since 1986 and a member of Pro-Fac
since 1961. Mr. Roe is a vegetable,  grain and dry bean farmer (Roe Acres, Inc.;
Bellona, New York).

Darell  Sarff was elected a Director of Pro-Fac in February  1997 and has been a
member of Pro-Fac since 1988.  Mr. Sarff is a grain and vegetable  farmer (Sarff
Farms; Chandlerville, Illinois).

Term of Office:  Directors  of Pro-Fac  are elected for  three-year  terms,  and
one-third of the directors are elected annually. Officers of Pro-Fac are elected
for one-year terms.

                      MANAGEMENT AND DIRECTORS OF AGRILINK

Management and  Directors:  Effective upon  consummation  of the  acquisition of
Agrilink  Foods by Pro-Fac,  Pro-Fac  established  a  management  structure  for
Agrilink Foods,  providing for a Board of Directors consisting of one management
director,  Pro-Fac Directors and Disinterested  Directors. The number of Pro-Fac
Directors is equal to the number of Disinterested Directors. The Chairman of the
Board is a Pro-Fac Director.  The management and directors are listed below. The
Cooperative  may in the future  expand the Board of  Directors,  but Pro-Fac has
undertaken to cause the  Cooperative  to maintain a Board on which the number of
Pro-Fac  Directors does not exceed the number of  Disinterested  Directors.  The
Senior Subordinated Notes - 11-7/8 Percent (due 2008) provide that there will be
a Change of Control  if,  for a period of 120  consecutive  days,  the number of
Disinterested  Directors on the Board of Directors  of the  Cooperative  is less
than the  greater  of (i) two and  (ii) the  number  of  directors  who are also
directors,  members or affiliates of the  Cooperative.  The New Credit  Facility
provides  that  there  will be a change of  control  if the  number  of  Pro-Fac
directors exceeds the number of disinterested directors.

Set forth below is certain  information  concerning the individuals who serve as
directors and officers of the Cooperative.
<TABLE>

                                   Year of
       Name                         Birth                           Positions

<S>                                 <C>          <C>
Dennis M. Mullen(1)                 1953         President and Chief Executive Officer and Director

William D. Rice(4)                  1934         Senior Vice President Strategic Development

Earl L. Powers                      1944         Executive Vice President and Chief Financial Officer

Stephen R. Wright                   1947         Executive Vice President Agriculture and Secretary

David M. Mehalick                   1956         Vice President and Legal Counsel

Bruce R. Fox(2)                     1947         Director and Chairman of the Board

Cornelius D. Harrington, Jr.(3)     1927         Director

Steven D. Koinzan(2)                1948         Director and Vice Chairman of the Board

Paul E. Roe(2)                      1939         Director

Walter F. Payne(3)                  1936         Director

Frank M. Stotz(3)                   1930         Director

<FN>
(1) Management Director.

(2) Pro-Fac Director.

(3) Disinterested Director.

(4) Mr. Rice retired from the Company effective June 30, 2000.
</FN>
</TABLE>
<PAGE>
Dennis M.  Mullen  has been the  President  and Chief  Executive  Officer  since
January  1997 and a Director  of  Agrilink  Foods  since May 1996.  He was Chief
Operating  Officer from May 1996 to January 1997 and  Executive  Vice  President
since January 1996. He had been President and Chief Executive Officer of Curtice
Burns  Foods from  March 1993 to May 1996.  He was  Senior  Vice  President  and
Business Unit Manager Food Service of Curtice Burns Foods from 1991 to 1993, and
Senior Vice  President-Custom  Pack Sales for Nalley from 1990 to 1991. Prior to
employment with Agrilink Foods, he was President and Chief Executive  Officer of
Globe  Products  Company.  He  currently  serves on the Board of  Directors  for
Grocery  Manufacturers  of America,  National Food Processors  Association,  the
Popcorn  Institute,  United Way of Greater  Rochester,  Genesee Valley  American
Heart Association, St. Leo College, the Rochester Institute of Technology School
of Food, Hotel, Travel Management's National Advisory Board, and Chase Manhattan
Bank's Northeast Advisory Board.

William D. Rice has been  Senior  Vice  President  Strategic  Development  since
February 1997 and Secretary of Agrilink Foods since 1989. He was Chief Financial
Officer from 1969 to February 1997. He was Treasurer of Agrilink Foods from 1975
to 1996. He was Vice  President-Finance  of Agrilink Foods from 1969 to 1991. He
was Assistant  Treasurer of Pro-Fac from 1970 to February 1997 (Management Chief
Financial Officer for Pro-Fac).  Mr. Rice has retired from the company effective
June 30, 2000.

Earl L. Powers has been  Executive Vice  President and Chief  Financial  Officer
since February 1997. He was Vice President and Corporate  Controller  from March
1993 to February  1997, and Vice  President  Finance and Management  Information
Systems,  Curtice Burns Foods business unit of Agrilink Foods from 1991 to March
1993.  Prior to joining  Agrilink Foods, he was Controller of various  Pillsbury
Company divisions 1987-1990 and various other executive  management positions at
the Pillsbury Company 1976-1987.

Stephen R. Wright has been Executive  Vice President  since November 6, 1996. He
was Senior Vice President - Procurement of Agrilink Foods from November 1994 and
Vice  President -- Procurement  for Agrilink Foods from 1990 to November,  1994,
having  served as  Director  of  Commodities  and  Administration  Services  for
Agrilink Foods from 1988 to 1990.

David M.  Mehalick  joined  Agrilink  Foods  May 1, 1999 as Vice  President  and
General  Counsel.  Prior to employment  with Agrilink Foods, he practiced law in
the firm of Harris Beach & Wilcox from 1981 to 1999.

Bruce R. Fox has been a Director of Agrilink  Foods since the  completion of the
Pro-Fac acquisition of Agrilink Foods and in fiscal 2000 was elected Chairman of
the Board.  He has been a Director of Pro-Fac  since 1974.  He was  Treasurer of
Pro-Fac from 1984 until March 27, 1995,  when he was elected  President.  He has
been a member of Pro-Fac  since 1974.  Mr. Fox is a fruit and  vegetable  grower
(N.J. Fox & Sons, Inc., Shelby, MI).

Cornelius D. Harrington,  prior to his retirement,  was President of the Bank of
New  England-West  in  Springfield,  MA and a  predecessor  to the  Bank  of New
England-West  from 1978 to December 1990. He was Chief Executive  Officer of the
Bank of New  England-West  from 1984 to December 1990.  Until 1987, he served as
Chairman of the Board of Directors of BayState  Medical  Center in  Springfield,
MA. He is a former Director of the Farm Credit Bank of Springfield since January
1994.

Steven D. Koinzan has been a Director of Agrilink  Foods since the completion of
the Pro-Fac  acquisition  of Agrilink  Foods and in fiscal 2000 was elected Vice
Chairman  of the board.  He has been a Director of Pro-Fac  since  1983.  He was
Secretary of Pro-Fac  from March 1993 until March 27, 1995,  when he was elected
Treasurer. He has been a member of Pro-Fac since 1979. Mr. Koinzan is a popcorn,
field corn and soybean farmer (Koinzan Farms; Norden, Nebraska).

Walter F. Payne has been a Director of Agrilink  Foods  since  January  1996 and
President  and Chief  Executive  Officer of Blue Diamond  Growers since 1992. He
held  various  positions at Blue Diamond  Growers  between 1973 and 1992.  He is
currently on the Board of Directors  of the Almond Board of  California  and the
International Nut Council, and the National Council of Farmer Cooperatives,  and
a member of the Board of Trustees  for the  Graduate  Institute  of  Cooperative
Leadership.

Paul E. Roe was elected a Director of  Agrilink  in fiscal  2000.  He has been a
Director of Pro-Fac since 1986 and a member of Pro-Fac since 1961.  Mr. Roe is a
vegetable, grain and dry bean farmer (Roe Acres, Inc.; Bellona, New York).

Frank M. Stotz has been a Director of Agrilink Foods since the completion of the
Pro-Fac  acquisition  of  Agrilink  Foods.  Mr.  Stotz  retired in 1994 from his
position  as Senior  Vice  President  - Finance  of Bausch & Lomb  Incorporated.
Before  joining  Bausch & Lomb in that capacity in 1991, Mr. Stotz was a partner
with Price Waterhouse.

Term of Office:  All directors of Agrilink  Foods will hold office from the date
of election  until the next  annual  meeting of the  shareholder  or until their
successors  are duly elected and qualified.  Each executive  officer of Agrilink
Foods will hold office from the date of election  until his successor is elected
or appointed.
<PAGE>
There are no family  relationships  between any Director,  executive officer, or
any  person  nominated  or chosen by  Agrilink  Foods to  become a  Director  or
executive officer.

ITEM 11.      EXECUTIVE COMPENSATION

The following tables show the cash  compensation and certain other components of
the  compensation  of the chief  executive  officer  and four other most  highly
compensated  executive  officers of the Cooperative,  earned during fiscal years
ended June 24, 2000, June 26, 1999, and June 27, 1998 (collectively,  the "Named
Executive Officers").
<TABLE>
Executive Compensation
Summary Compensation Table
<CAPTION>
                                                                                            Annual
                                                                                      Compensation1                      RSIP/
                                                                                ---------------------------             Matching
Name and Principal Position                                       Year            Salary           Bonus2            Contributions
---------------------------                                       ----          -----------      ---------           -------------

<S>                                                                <C>          <C>              <C>                   <C>
Dennis M. Mullen -                                                 2000         $ 525,000        $        0            $   3,173
   President and Chief Executive Officer and Director              1999         $ 500,000        $        0            $   4,241
                                                                   1998         $ 432,256        $  216,000            $   7,783

Earl L. Powers                                                     2000         $ 283,854        $        0            $   4,125
   Executive Vice President Finance and Chief Financial Officer    1999         $ 260,096        $        0            $   5,124
                                                                   1998         $ 239,327        $  140,000            $   7,106

William D. Rice4                                                   2000         $ 271,014        $        0            $   3,752
   Senior Vice President Strategic Development                     1999         $ 271,014        $        0            $   4,781
                                                                   1998         $ 273,342        $  100,000            $   5,019

David M. Mehalick3                                                 2000         $ 241,867        $        0            $       0
   Vice President and Legal Counsel                                1999         $  36,923        $        0            $       0

Stephen R. Wright                                                  2000         $ 212,160        $        0            $   3,120
   Executive Vice President Agriculture                            1999         $ 205,999        $        0            $   3,762
                                                                   1998         $ 200,154        $  100,000            $   5,446

<FN>
1  No Named Executive  Officer has received  personal benefits during the period
   in excess of the lesser of $50,000 or 10 percent of annual salary.

2  Pursuant to the Management  Incentive Plan of Agrilink Foods (the  "Incentive
   Plan"), additional compensation is paid if justified by the activities of the
   officers and employees  eligible under the Incentive Plan and by the earnings
   of Agrilink Foods and of Pro-Fac Cooperative, Inc. ("Pro-Fac").

3  Mr. Mehalick's employment with Agrilink Foods began May 1, 1999.

4  Mr. Rice retired from the Company on June 30, 2000
</FN>
</TABLE>



<PAGE>


Long-Term Incentive Plan - Awards in Last Fiscal Year
<TABLE>


                                                                                      Estimated Future Payouts
                              (b)                        (c)                     Under Non-Stock Price Based Plans
                       Number of Shares          Performance or Other              (d)                    (e)
   (a)                  Units or Other          Period Until Maturation         Threshold               Target
   Name                Rights Granted (1)              or Payout                 ($ or #)             ($ or #)(2)


<S>                          <C>                      <C>                         <C>                     <C>
Dennis M. Mullen             82,850                   6/23/2004                   $0                      $0
Earl L. Powers               34,176                   6/23/2004                   $0                      $0
Stephen R. Wright            22,403                   6/23/2004                   $0                      $0
David M. Mehalick            27,838                   6/23/2004                   $0                      $0

<FN>
(1)  On June 29,  2000,  the  Cooperative  issued  performance  units  under the
     Agrilink  Foods Equity Value Plan ("EVP") to a select group of  management.
     The future value of the performance units is discretionary. The performance
     units vest 100 percent on the fourth anniversary of grant. One-third of the
     appreciated  value of units in excess of the initial grant price is paid as
     cash  compensation  over the subsequent three years. The final value of the
     2000 performance units is determined on the fourth anniversary of grant.

(2)  The value of the June 29, 2000 grants from the Agrilink  Foods Equity Value
     Plan is  discretionary.  The beginning value of these performance units was
     set at a level requiring improved earnings and debt-repayment  performance.
     The target  payouts  shown above are based on the value of the  performance
     units at fiscal  2000  earnings  and debt  levels and would yield no payout
     from the plan at those  levels.  If future  performance  equals fiscal 2000
     performance,  no payouts will be made from the plan relative to the options
     granted on June 29, 2000.
</FN>
</TABLE>

Retirement Plans:  Agrilink Foods' Master Salaried Retirement Plan (the "Pension
Plan") provides  defined  retirement  benefits for its officers and all salaried
and clerical  personnel.  The  compensation  upon which the pension benefits are
determined  is  included  in the  salary  columns of the  "Summary  Compensation
Table."

For retirement  before age 65, the annual  benefits are reduced by an amount for
each year prior to age 65 at which such retirement  occurs so that if retirement
occurs at age 55, the benefits are 70 percent of those payable at age 65.

The  approximate  number of years of Plan  participation  under Agrilink  Foods'
Pension  Plan as of June 24,  2000,  of the  Executive  Officers  listed  in the
Summary  Compensation  Table are as  follows:  Dennis M.  Mullen-9,  William  D.
Rice-28, Earl L. Powers-8, Stephen R. Wright-25 and David M. Mehalick-0.

On January 28, 1992,  Agrilink Foods adopted an Excess Benefit  Retirement  Plan
which serves to provide  employees with the same  retirement  benefit they would
have received from Agrilink  Foods' Master  Salaried  Retirement  Plan under the
career  average base pay formula,  but for changes  required  under the 1986 Tax
Reform Act and the  compensation  limitation  under  Section  401(a)(17)  of the
Internal  Revenue  Code,  which was  $150,000  on January 1, 1994,  having  been
revised in the 1992 Omnibus Budget Reform Act.


<PAGE>

The following table shows the estimated  pension  benefits  payable to a covered
participant,  at age 65,  at the  specified  final  average  pay,  and  years of
credited  service levels under Agrilink Foods' Master  Salaried  Retirement Plan
and the Excess Benefit Retirement Plan.

                               Pension Plan Table

                                 Years of Plan Participation
    Final     ----------------------------------------------------------------
 Average Pay        15         20           25            30            35
 -----------  ----------   ---------    ---------     ---------      ---------

$  125,000    $ 21,476    $  27,988     $  34,530     $  41,120      $  47,915
   150,000      26,726       34,988        43,280        51,620         60,165
   175,000      31,976       41,988        52,030        62,120         72,415
   200,000      37,226       48,988        60,780        72,620         84,665
   225,000      42,476       55,988        69,530        83,120         96,915
   250,000      47,726       62,988        78,280        93,620        109,165
   275,000      52,976       69,988        87,030       104,120        121,415
   300,000      58,226       76,988        95,780       114,620        133,665
   325,000      63,476       83,988       104,530       125,120        145,915
   350,000      68,726       90,988       113,280       135,620        158,165
   375,000      73,976       97,988       122,030       146,120        170,415
   400,000      79,226      104,988       130,780       156,620        182,665

Termination  Protection   Provisions:   Agrilink  Foods  has  adopted  a  Salary
Continuation Agreement for Mr. Mullen, whereby, two years of salary and benefits
continuation  will be  provided  if Mr.  Mullen's  employment  is  involuntarily
terminated  for  reasons  other than for  "cause" as such term is defined in the
Agreement.  In addition,  this  agreement  provides Mr.  Mullen with a retention
bonus in an amount  equal to one year of his base salary as of September 1, 1998
if he continues to provide services to Agrilink Foods through August 31, 2001 in
accordance to the reasonable terms and conditions of his employment.

Directors'  Compensation:  In  fiscal  2000,  non-employee  directors  who  were
designated by Pro-Fac  received an annual stipend of $6,000 per year,  plus $200
per day for  attending  Board  or  Committee  meetings.  The  Pro-Fac  President
received an annual stipend of $12,000 per year,  plus $400 per day for attending
Board or  Committee  meetings.  In fiscal  2000,  all other  outside  directors,
Messrs.  Harrington,  Payne,  and Stotz  received  an annual  rate of $18,000 in
addition to $600 per day. In fiscal 2000,  the Chairman of the Board  received a
fixed  amount in lieu of the  standard  attendance  fees and  annual  stipend of
$24,700.

ITEM 12.      SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The following  table sets forth certain  information,  as of June 24, 2000, with
respect to (i) each  person  known by Pro-Fac to own  beneficially  5 percent or
more of any class of Pro-Fac's voting  securities,  (ii) each director and named
executive  officer of Pro-Fac and (iii) all directors and officers of Pro-Fac as
a group.
<TABLE>

                                                                        Amount and Nature of         Percent of
             Name                            Title of Class            Beneficial Ownership(a)        Class(b)
------------------------------        ----------------------------    ------------------------       ----------


<S>                                   <C>                                     <C>                      <C>
Cherry Central Cooperative, Inc.      Common                                  346,680                  16.25%
   PO Box 988                         Class A Cumulative Preferred             80,126                   1.89%
   Traverse City, MI 49685

Michigan Blueberry Growers Assoc.     Common                                  116,400                   5.46%
   PO Drawer B                        Class A Cumulative Preferred             22,760                   0.54%
   Grand Junction, MI 49056

Dale E. Burmeister                    Common                                   12,874(c)                0.60%
                                      Class A Cumulative Preferred                 95(c)                0.00%
                                      Class A Cumulative Preferred             10,348                   0.24%


</TABLE>

<PAGE>
<TABLE>

                                                                        Amount and Nature of         Percent of
             Name                            Title of Class            Beneficial Ownership(a)        Class(b)
------------------------------        ----------------------------    ------------------------       ----------


<S>                                   <C>                                     <C>                      <C>

Peter R. Call                         Common                                  39,158(d)                 1.84%
                                      Class A Cumulative Preferred            26,870(d)                 0.64%
                                      Class A Cumulative Preferred            14,194(e)                 0.33%
                                      Class A Cumulative Preferred             5,361(f)                 0.13%
                                      Class A Cumulative Preferred             8,246                    0.19%

Glen Lee Chase                        Common                                   9,472(g)                 0.44%
                                      Class A Cumulative Preferred             7,672(g)                 0.18%

Tom R. Croner                         Common                                   3,776(h)                 0.18%
                                      Class A Cumulative Preferred            12,822(i)                 0.30%

Kenneth A. Dahlstedt                  Common                                   6,633                    0.31%
                                      Class A Cumulative Preferred             1,277(l)                 0.06%
                                      Class A Cumulative Preferred               290                    0.01%

Robert DeBadts                        Common                                  11,873(j)                 0.56%
                                      Class A Cumulative Preferred            11,196(j)                 0.26%
                                      Class A Cumulative Preferred               100(k)                 0.00%

Bruce R. Fox                          Common                                  21,982(m)                 1.03%
                                      Class A Cumulative Preferred             9,152(m)                 0.22%
                                      Class A Cumulative Preferred             7,428(n)                 0.17%
                                      Class A Cumulative Preferred             1,085                    0.03%
                                      Class A Cumulative Preferred               820                    0.02%

Steven D. Koinzan                     Common                                   8,280                    0.39%
                                      Class A Cumulative Preferred             4,388                    0.10%

David M. Mehalick                     None                                         0                    0.00%

Kenneth A. Mattingly                  Common                                  10,221(o)                 0.47%
                                      Class A Cumulative Preferred             9,076(o)                 0.21%

Dennis M. Mullen                      None                                         0                    0.00%

Allan W. Overhiser                    Common                                   2,874(p)                 0.13%
                                      Class A Cumulative Preferred             1,926(p)                 0.05%

Earl L. Powers                        None                                         0                    0.00%

William D. Rice                       None                                         0                    0.00%

Paul E. Roe                           Common                                  18,715(q)                 0.88%
                                      Class A Cumulative Preferred             5,013(q)                 0.127%

Darell Sarff                          Common                                   2,616                    0.13%
                                      Class A Cumulative Preferred             1,284                    0.03%

Stephen R. Wright                     Class A Cumulative Preferred             1,140                    0.03%

All directors and officers as a group Common                                 148,774                    6.96%
                                      Class A Cumulative Preferred           139,783                    3.29%
</TABLE>

<PAGE>


(a)  Certain of the directors named above may have the opportunity, along with
     the other  members  producing  a specific  crop,  to  acquire  beneficial
     ownership of  additional  shares of the common stock of Pro-Fac  within a
     period of approximately  60 days,  commencing each year on February 1, if
     Pro-Fac  determines  that a  permanent  change is  required  in the total
     quantity of that particular crop.

(b)  In the above table,  each director who has direct  beneficial  ownership
     of common or preferred  shares by reason of being the record owner of such
     shares has sole voting and  investment  power with respect to such shares,
     while each  director who has direct  beneficial  ownership  of common or
     preferred  shares as a result of owning such shares as a joint  tenant has
     shared voting and  investment  power  regarding  such  shares.  Each
     director  who has  indirect  beneficial  ownership of common or preferred
     shares  resulting from his status as a shareholder or a partner of a
     corporation or partnership  which is the record owner of such shares has
     sole voting and  investment  power if he controls such  corporation  or
     partnership.  If he does not control  such  corporation  or  partnership,
     he has shared  voting and  investment  power.  Pro-Fac does not believe
     that the percentage ownership of any such corporation or partnership by a
     director is material, since in the aggregate no director beneficially owns
     in excess of 5 percent of either the common or preferred shares of Pro-Fac.

(c)  Record ownership by Lakeshore Farms, Inc.

(d)  Record ownership by My-T Acres, Inc.

(e)  Record ownership by My-T Acres, Inc. Employee Profit Sharing Plan

(f)  Record ownership by Call Farms, Inc.

(g)  Record ownership by Chase Farms, Inc.

(h)  Record ownership by Richard Croner & Son

(i)  Record ownership by T-Rich, Inc.

(j)  Record ownership by Lake Breeze Farm, Inc.

(k)  Record ownership jointly with spouse

(l)  Record ownership by Ag-Pro, Inc.

(m)  Record ownership by N.J. Fox & Sons, Inc.

(n)  Record ownership by K. Fox

(o)  Record ownership by M-B Farms, Inc.

(p)  Record ownership by A.W. Overhiser Orchards

(q)  Record ownership by Roe Acres, Inc.

Section 16(a) Beneficial Ownership Reporting Compliance:

ITEM 13.   CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

Management believes all such transactions were on terms no less favorable to the
Cooperative than could have been reached with unaffiliated third parties.

Borrowings by Pro-Fac:  The New Credit Facility and Senior  Subordinated Notes -
11-7/8 Percent (due 2008) permit  Agrilink Foods to make demand loans to Pro-Fac
for working capital purposes in amounts not to exceed $40.0 million at any time,
each such  loan to bear  interest  at a rate  equal to the rate in effect on the
date of such loan  under the  Revolving  Credit  Facility.  The loan  balance is
required to be reduced to zero for a period of not less than 15 consecutive days
in each fiscal year. Except for the foregoing provision and except for Pro-Fac's
guarantee of the Senior  Subordinated  Notes - 11-7/8 Percent (due 2008) and the
New  Credit  Facility,  as long as  Pro-Fac  has the right to  borrow  under the
Pro-Fac Marketing and Facilitation  Agreement,  the Senior  Subordinated Notes -
11-7/8 Percent (due 2008) do not permit Pro-Fac to incur any other indebtedness.

Equity  Ownership in CoBank:  As part of its lending  arrangements  with CoBank,
which  is  a  cooperative,  Pro-Fac  has  made  investments  in  the  bank.  The
Cooperative made these  investments  through (i) a capital  purchase  obligation
equal to a percentage,  set annually  based on CoBank's  capital  needs,  of its
interest  paid to CoBank and (ii) a  patronage  rebate on  interest  paid by the
Cooperative  to CoBank  based on  CoBank's  earnings,  which is paid in cash and
capital  certificates.  As of June 24,  2000,  the  amount of the  Cooperative's
investment in CoBank was approximately $19.1 million.


<PAGE>


Transactions  Between  Agrilink Foods and  AgriFrozen:  Agrilink Foods purchases
frozen  vegetables from  AgriFrozen.  For fiscal 2000, the net sales amounted to
approximately  $22.4  million.  At June 24,  2000,  AgriFrozen  had an  accounts
receivable from Agrilink of $10.3 million.

In addition,  AgriFrozen  entered into an administrative  service agreement with
Agrilink Foods.  Agrilink Foods provides  certain  management,  consulting,  and
administrative  services.  For the year ended June 24, 2000, AgriFrozen incurred
approximately $1.0 million in service fees related to the agreement.

Purchase of Crops From  Pro-Fac:  Each of the members of Pro-Fac  sells crops to
Pro-Fac  pursuant  to a general  marketing  agreement  between  such  member and
Pro-Fac, which crops in turn are sold to the Cooperative pursuant to the Pro-Fac
Marketing  and  Facilitation  Agreement.   During  fiscal  2000,  the  following
directors  and  executive  officers of Pro-Fac  directly or  indirectly  through
entities  owned or  controlled  by such  officers and  directors,  sold crops to
Pro-Fac and provided harvesting, trucking and waste removal services to Agrilink
Foods for the following aggregate amounts:

<TABLE>
(Dollars in Thousands)
<CAPTION>

                                                                    RELATIONSHIP                               GROSS PURCHASES
        NAME                                                         TO PRO-FAC                                 IN FISCAL 2000
------------------------                         --------------------------------------------------------   ---------------------
                                                                                                            (Dollars in Thousands)

<S>                                              <C>                                                               <C>
Dale E. Burmeister...........................    Director                                                          $    343
Peter R. Call................................    Director                                                          $  3,711**
Robert V. Call, Jr.*.........................    Director                                                          $  3,711**
Glen Lee Chase...............................    Director                                                          $     55
Tom R. Croner................................    Director                                                          $    111
Kenneth A. Dahlstedt.........................    Director                                                          $    266
Robert DeBadts...............................    Director                                                          $    401
Bruce R. Fox***..............................    Director and Chairman of the Board, President                     $  1,159
Steven D. Koinzan***.........................    Director and Vice Chairman of the Board, Vice President           $    469
Kenneth A. Mattingly.........................    Director                                                          $  1,388
Allan W. Overhiser...........................    Director                                                          $     64
Paul E. Roe***...............................    Director                                                          $    868
Darell Sarff.................................    Director                                                          $     95

<FN>
*      Robert V. Call, Jr. resigned from the board effective February 2000.
**     Robert V. Call, Jr. and Peter R. Call both indirectly sold crops through My-T Acres, Inc.
***    Bruce R. Fox, Steven D. Koinzan, and Paul E. Roe are directors of both Pro-Fac and Agrilink Foods.
</FN>
</TABLE>

                   DIRECTORS AND OFFICERS LIABILITY INSURANCE

As authorized  by New York law and in accordance  with the policy of that state,
the Cooperative has obtained  insurance from Chubb Group Insurance  insuring the
Cooperative  against any obligation it incurs as a result of its indemnification
of its officers and  directors,  and insuring  such  officers and  directors for
liability  against which they may not be  indemnified by the  Cooperative.  This
insurance  has a term  expiring  on  October  15,  2000,  at an  annual  cost of
approximately  $130,000. As of this date, no sums have been paid to any officers
or directors of the Cooperative under this indemnification insurance contract.


<PAGE>


                                     PART IV

ITEM 14.      EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K

     (a) (1)    FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

                          INDEX TO FINANCIAL STATEMENTS

The following appears in ITEM 8 of this report:

<TABLE>
<S>                                                                                                                          <C>
     ITEM                                                                                                                    Page

Pro-Fac Cooperative, Inc. and Consolidated Subsidiary:
   Management's Responsibility for Financial Statements....................................................................   26
   Report of Independent Accountants.......................................................................................   27
   Consolidated Financial Statements for the years ended
     June 24, 2000, June 26, 1999, and June 27, 1998:

     Consolidated Statements of Operations, Net Proceeds, and Comprehensive Income for the years ended June 24, 2000,
       June 26, 1999, and June 27, 1998....................................................................................   28
     Consolidated Balance Sheet at June 24, 2000 and June 26, 1999.........................................................   29
     Consolidated Statement of Cash Flows for the years ended June 24, 2000, June 26, 1999, and June 27, 1998..............   30
     Consolidated Statements of Changes in Shareholders' and Members' Capitalization and Redeemable Stock
       for the years ended June 24, 2000, June 26, 1999, and June 27, 1998.................................................   32
     Notes to Consolidated Financial Statements............................................................................   33
     Selected Quarterly Financial Data.....................................................................................   54
</TABLE>

         (2)    The following additional financial data are set forth herein:


                  SCHEDULE II:  Valuation and Qualifying Accounts
<TABLE>

                                                                                                     SCHEDULE II

Pro-Fac Cooperative, Inc.
Valuation and Qualifying Accounts
<CAPTION>

                                                                                            Fiscal Years Ended
                                                           ---------------------------------------------------------
                                                           June 24, 2000            June 26, 1999       June 27, 1998
                                                           -------------            -------------       -------------

<S>                                                        <C>                     <C>                   <C>
Allowance for doubtful accounts
     Balance at beginning of period                        $  1,607,000            $     774,000         $    970,000
     Additions charged to expense                               201,000                  208,000               17,000
     Deductions                                                (810,000)                (280,000)            (213,000)
     Increase due to acquisition*                                     0                  905,000                    0
                                                           ------------            -------------         ------------
     Balance at end of period                              $    998,000            $   1,607,000         $    774,000
                                                           ============            =============         ============
Inventory reserve**
     Balance at beginning of period                        $  8,401,000            $     391,000         $    362,000
     Net change                                              (5,016,000)                (921,000)              29,000
     Increase due to acquisition*                                     0                8,931,000                    0
                                                           ------------            -------------         ------------
     Balance at end of period                              $  3,385,000            $   8,401,000         $    391,000
                                                           ============            =============         ============
Tax valuation allowance***
     Balance at beginning of period                        $  1,409,000            $   5,550,000         $   6,212,000
     Net change                                               4,343,000               (4,141,000)             (662,000)
                                                           ------------            -------------         --------------
Balance at end of period                                   $  5,752,000            $   1,409,000         $   5,550,000
                                                           ============            =============         =============

<FN>
*  Represents  balance  acquired  in  conjunction  with  the  DFVC  and  Agripac
   acquisitions.

** Difference between FIFO cost and market applicable to inventories. Reductions
   in the reserve in fiscal 2000 were recorded as related inventory was disposed.

*** See  further  discussion  regarding  tax  matters at NOTE 6 to the "Notes to
    Consolidated Financial Statements."
</FN>
</TABLE>

Schedules  other than those listed above are omitted because they are either not
applicable  or not  required,  or  the  required  information  is  shown  in the
financial statements or the notes thereto.


<PAGE>



<TABLE>
         <S>    <C>
         (3)    The following exhibits are filed herein or have been previously filed with the Securities and Exchange Commission:
</TABLE>


(b) Report on Form 8-K

    No reports on Form 8-K were filed in the fourth quarter of fiscal 2000.

<TABLE>
(c)  EXHIBITS:

      Exhibit
      Number                                  Description

       <S>        <C>
       3.1        Restated Certificate of Incorporation of the Company (filed as
                  Exhibit 3.1 to the Company's Quarterly Report on Form 10-Q for
                  the third fiscal quarter ended March 27, 1999 and incorporated
                  herein by reference).

       3.2        Bylaws of the Company  (filed as Exhibit 3.2 to the  Company's
                  Quarterly  Report on Form 10-Q for the  third  fiscal  quarter
                  ended March 27, 1999 and incorporated herein by reference).

       4.1        Indenture,  dated as of November 18, 1998,  between  Agrilink  Foods,  Inc.,
                  the Guarantors  named therein and IBJ Schroder Bank & Trust Company,  Inc.,
                  as Trustee (filed as Exhibit 4.1 to Agrilink Foods, Inc.'s Registration
                  Statement on Form S-4 filed January 5, 1999 (Registration No. 333-70143)
                  and incorporated herein by reference).

       4.2        Form of 11-7/8%  Senior  Subordinated  Notes  due 2008  (filed  as  Exhibit  B,
                  to Exhibit  4.1 to  Agrilink  Foods,  Inc.' s Registration  Statement on Form S-4
                  filed January 5, 1999 (Registration No. 333-70143) and incorporated  herein by
                  reference).

       4.3        Indenture,  dated as of November 3, 1994, among PFAC,  Pro-Fac
                  and IBJ Schroder Bank & Trust Company,  as Trustee, as amended
                  by First Supplemental Indenture, dated as of November 3, 1994,
                  each with  respect to Agrilink  Foods,  Inc.'s  12.25%  Senior
                  Subordinated  Notes due 2005 (filed as Exhibit 4.1 to Agrilink
                  Foods,  Inc.'s  Registration   Statement  on  Form  S-4  filed
                  November 14, 1994 (Registration No. 33-56517) and incorporated
                  herein by reference).

       4.4        Second   Supplemental   Indenture   (amending   the  Indenture
                  referenced  in Exhibit 4.3  herein)  dated  November  10, 1997
                  (filed as Exhibit 10.25 to the Company's Annual Report on Form
                  10-K for the fiscal year ended June 27, 1998, and incorporated
                  herein by reference).

       4.5        Third   Supplemental   Indenture   (amending   the   Indenture
                  referenced  in Exhibit 4.3 herein)  dated  September  24, 1998
                  (filed as Exhibit 10.26 to the Company's Annual Report on Form
                  10-K for the fiscal year ended June 26, 1999, and incorporated
                  herein by reference).

      10.1       Marketing and Facilitation  Agreement,  dated as of November 3, 1994,  between
                 the Company and Agrilink Foods,  Inc. (filed as  Exhibit  10.1 to
                 Agrilink  Foods,  Inc.'s  Registration  Statement  on  Form  S-4  filed
                 November  17,  1994 Registration No. 33-56517) and incorporated herein by
                 reference).

      10.2       Amendment to Marketing and Facilitation  Agreement between the
                  Company and Agrilink  Foods,  Inc.  dated  September  23, 1998
                  (filed as Exhibit 10.9 to the  Company's  Quarterly  Report on
                  Form 10-Q for the third  fiscal  quarter  ended March 27, 1999
                  and incorporated herein by reference).

      10.3        Management  Incentive  Plan, as amended (filed as Exhibit 10.2 to Agrilink Foods, Inc.'s
                  Registration  Statement on Form S-4  filed November 17, 1994 (Registration No. 33-56517)
                  and incorporated herein by reference).

      10.4        Supplemental Executive Retirement Plan, as amended (filed as  Exhibit 10.3 to
                  Agrilink  Foods,  Inc.'s  Registration Statement on Form S-4  filed
                  November 17, 1994 (Registration No. 33-56517) and incorporated herein by reference).

      10.5        Master Salaried  Retirement  Plan, as amended (filed as Exhibit 10.5 to Agrilink Foods,  Inc.'s
                  Registration  Statement on Form S-4  filed November 17, 1994 (Registration No. 33-56517)
                  and incorporated herein by reference).
</TABLE>
<PAGE>
<TABLE>
(c)  EXHIBITS (Continued):

     Exhibit
     Number                                 Description

      <S>       <C>
      10.6      Non-Qualified  Profit  Sharing  Plan,  as  amended  (filed  as
                Exhibit 10.6 to Agrilink Foods, Inc.'s Registration  Statement
                on  Form  S-4  filed  November  17,  1994   (Registration  No.
                33-56517) and incorporated herein by reference).

      10.7      Second Amendment to  Non-Qualified  Profit Sharing Plan (filed
                as Exhibit  10.14 to the Company's  Registration  Statement on
                Form S-1 filed June 15, 1995  (Registration  No. 33-60273) and
                incorporated herein by reference).

      10.8      Excess Benefit Retirement Plan (filed as Exhibit 10.7 to Agrilink Foods,
                Inc.'s Registration  Statement on Form S-4 filed November 17, 1994 (Registration
                No. 33-56517) and incorporated herein by reference).

      10.9      Salary  Continuation  Agreement - Dennis M.  Mullen  (filed as
                Exhibit 10.13 to the Company's  Annual Report on Form 10-K for
                the fiscal year ended June 26, 1999 and incorporated herein by
                reference).

     10.10      Agrilink  Equity  Value Plan  adopted  June 24, 1996 (filed as
                Exhibit 10.17 to the Company's  Annual Report on Form 10-K for
                the fiscal year ended June 29, 1996 and incorporated herein by
                reference).

     10.11      OnSite Services  Agreement with Systems & Computer  Technology
                (filed as Exhibit 10.21 to the Company's Annual Report on Form
                10-K for the fiscal year ended June 28, 1997 and  incorporated
                herein by reference).

     10.12      Raw Product  Supply  Agreement  with Seneca Foods  Corporation
                (filed as Exhibit 10.22 to the Company's Annual Report on Form
                10-K for the fiscal year ended June 28, 1997 and  incorporated
                herein by reference).

     10.13      Reciprocal  Co-Pack  Agreement  with Seneca Foods  Corporation
                (filed as Exhibit 10.23 to the Company's Annual Report on Form
                10-K for the fiscal year ended June 28, 1997 and  incorporated
                herein by reference).

     10.14      Credit Agreement among the Company,  Agrilink Foods, Inc., and
                Harris Trust and Savings Bank,  and Bank of Montreal,  Chicago
                Branch, and the Lenders from time to time party hereto,  dated
                as of  September  23,  1998  (filed  as  Exhibit  10.1  to the
                Company's  Quarterly  Report on Form 10-Q for the first fiscal
                quarter ended  September 26, 1998 and  incorporated  herein by
                reference).

     10.15      Subordinated  Promissory Note of Agrilink Foods,  Inc. to Dean
                Foods  Company,  dated as of  September  23,  1998  (filed  as
                Exhibit 10.3 to the  Company's  Quarterly  Report on Form 10-Q
                for the first  fiscal  quarter  ended  September  26, 1998 and
                incorporated herein by reference).

     10.16      First  Amendment to the Credit  Agreement  referenced in 10.14
                herein  (filed  as  Exhibit  10.1  to  the  Company's  Amended
                Quarterly  Report on Form 10-Q/A for the first fiscal  quarter
                ended   September   25,  1999  and   incorporated   herein  by
                reference).

     10.17      Second Amendment to the Credit  Agreement  referenced in 10.14
                herein  (filed  as  Exhibit  10.2  to  the  Company's  Amended
                Quarterly  Report on Form 10-Q/A for the first fiscal  quarter
                ended   September   25,  1999  and   incorporated   herein  by
                reference).

     10.18      Third  Amendment to the Credit Agreement referenced in Exhibit 10.14 herein
                (filed as Exhibit  10.3 to the  Company's Amended  Quarterly  Report on
                Form 10-Q/A for the first fiscal quarter ended  September 25, 1999 and
                incorporated herein by reference).

     10.19      Fourth  Amendment  to the Credit  Agreement referenced in Exhibit  10.14 herein
                (filed as Exhibit 10.4 to the Company's Amended  Quarterly  Report on
                Form 10-Q/A for the first fiscal quarter ended  September 25, 1999 and
                incorporated herein by reference).

     10.20      Fifth  Amendment  to the Credit  Agreement  referenced  in Exhibit  10.14 herein
                (filed as Exhibit  10.5 to the  Company's Amended  Quarterly  Report on
                Form 10-Q/A for the first fiscal quarter ended  September 25, 1999 and
                incorporated herein by reference).
</TABLE>
<PAGE>
<TABLE>
(c)  EXHIBITS (Continued):
<CAPTION>

     Exhibit
     Number                                 Description

      <S>      <C>
      10.21    Service  Agreement  between  Agrilink  Foods,  Inc. and PF  Acquisition  II, Inc.,
               dated as of February 22, 1999 (filed as Exhibit 10.4 to the Company's
               Quarterly Report on Form 10-Q for the third fiscal quarter ended March 27, 1999 and
               incorporated herein by reference).

     10.22     Marketing and Facilitation Agreement, dated as of February 22,
               1999,  between the Company and PF Acquisition  II, Inc. (filed
               as Exhibit 10.5 to the Company's Quarterly Report on Form 10-Q
               for  the  third  fiscal  quarter  ended  March  27,  1999  and
               incorporated herein by reference).

     10.23     Credit  Agreement  among PF  Acquisition  II, Inc.,  the Banks
               hereto and CoBank, ACB, as Administrative Agent for the lender
               thereunder,  dated February 22, 1999 (filed as Exhibit 10.6 to
               the  Company's  Quarterly  Report  on Form  10-Q for the third
               fiscal quarter ended March 27, 1999 and incorporated herein by
               reference).

     10.24     Subordinated  Promissory  Note between PF Acquisition II, Inc.
               and CoBank,  ACB,  dated  February  22, 1999 (filed as Exhibit
               10.7 to the  Company's  Quarterly  Report on Form 10-Q for the
               third  fiscal  quarter  ended March 27, 1999 and  incorporated
               herein by reference).

     10.25     Asset Purchase  Agreement  among PF Acquisition  II, Inc., the
               Company and  Agripac,  Inc.,  Debtor and  Debtor-in-Possession
               dated  February  22,  1999  (filed  as  Exhibit  10.8  to  the
               Company's  Quarterly  Report on Form 10-Q for the third fiscal
               quarter  ended  March  27,  1999 and  incorporated  herein  by
               reference).

     18        Accountant's  Report  Regarding  Change in  Accounting  Method
               (filed as Exhibit 18 to the Company's Quarterly Report on Form
               10-Q for the first fiscal quarter ended September 28, 1996 and
               incorporated herein by reference).

     21        List of Subsidiaries (filed herewith)

     23        Accountant's Consent (filed herewith)

     24        Power of Attorney (included on page 69 of this Report)

     27        Financial Data Schedule (filed herewith).

</TABLE>


<PAGE>


                                   SIGNATURES

Pursuant to the  requirements of Section 13 or 15(d) of the Securities  Exchange
Act of 1934,  the  Registrant  had duly  caused  this report to be signed on its
behalf by the undersigned, thereunto duly authorized.

                                               PRO-FAC COOPERATIVE, INC.

Date:    September 15, 2000                BY:/s/   Earl L. Powers
         -------------------                       ------------------
                                                     EARL L. POWERS

                                                        TREASURER
                                              (Principal Financial Officer and
                                                Principal Accounting Officer)


                                POWER OF ATTORNEY

KNOW ALL MEN BY THESE PRESENTS,  that each person whose signature  appears below
constitutes  and appoints EARL L. POWERS,  his true and lawful  attorney-in-fact
and agent, with full power of substitution and resubstitution for him and in his
name,  place and stead, in any and all capacities to sign any and all amendments
to this Annual Report on Form 10-K and to file Pursuant to the  requirements  of
the  Securities  Exchange Act of 1934,  this report has been signed below by the
following  persons on behalf of the  Registrant and in the capacities and on the
dates indicated.


<PAGE>


Pursuant to the requirements of the Securities Exchange Act of 1934, this report
has been signed below by the following  persons on behalf of the  Registrant and
in the capacities and on the dates indicated.

           SIGNATURE                                 TITLE

/s/    Bruce R. Fox                      Chairman of the Board and Director
--------------------------------------   President
       (BRUCE FOX)

/s/    Steven D. Koinzan                 Vice Chairman of the Board and Director
--------------------------------------   Vice President
       (STEVEN D. KOINZAN)

/s/    Tom R. Croner                     Director
--------------------------------------
       (TOM R. CRONER)

/s/    Dale W. Burmeister                Director
--------------------------------------
       (DALE W. BURMEISTER)

/s/    Peter R. Call                     Director
--------------------------------------
       (PETER R. CALL)

/s/    Glen Lee Chase                    Director

      (GLEN LEE CHASE)

/s/    Kenneth A. Dahlstedt              Director
--------------------------------------
      (KENNETH A. DAHLSTEDT)

/s/    Robert DeBadts                    Director
--------------------------------------
      (ROBERT DEBADTS)

/s/    Kenneth A. Mattingly              Director
--------------------------------------
      (KENNETH A. MATTINGLY)

/s/    Allan W. Overhiser                Director
--------------------------------------
      (ALLAN W. OVERHISER)

/s/    Paul E. Roe                       Director
--------------------------------------
      (PAUL E. ROE)

/s/    Darell Sarff                      Director
--------------------------------------
      (DARELL SARFF)

/s/    Stephen R. Wright                 Secretary
--------------------------------------
      (STEPHEN R. WRIGHT)

/s/    Earl L. Powers                    Treasurer
--------------------------------------   (Principal Financial Officer and
      (EARL L. POWERS)                   Principal Accounting Officer)




SUPPLEMENTAL  INFORMATION TO BE FURNISHED WITH REPORTS FILED PURSUANT TO SECTION
15(d) OF THE ACT BY REGISTRANTS WHICH HAVE NOT REGISTERED SECURITIES PURSUANT TO
SECTION 12 OF THE ACT.

NO ANNUAL REPORT OR PROXY MATERIAL HAS BEEN SENT TO  REGISTRANT'S  SHAREHOLDERS,
AND NO PROXY MATERIAL IS INTENDED TO BE SENT. AN ANNUAL REPORT IS INTENDED TO BE
SENT.