Document:

Exhibit 10.35

 

EMPLOYMENT
AGREEMENT

 

AGREEMENT, dated as of the
2nd day of September 2005, by and among Birds Eye Holdings, LLC, a
Delaware limited liability company (“BE Holdings”), and Neil Harrison (the “Executive”).

 

WHEREAS, the BE Holdings
desires that Executive serve as an employee of Birds Eye Foods, Inc., a
Delaware corporation having its principal executive offices in Rochester, New
York (the “Company”) and an indirectly wholly-owned subsidiary of BE Holdings,
and the Executive is willing to accept employment with the Company, all on the
terms and conditions set forth below;

 

NOW, THEREFORE, in
consideration of the mutual covenants contained herein and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereby agree as follows:

 

1. Employment Period. Subject
to the terms and conditions of this Agreement, including Section 3, BE
Holdings agrees to cause the Company to employ the Executive, and the Executive
hereby accepts employment with the Company, for the period commencing on the September 8,
2005 (the “Effective Date”) and ending as provided in the next sentence (such
period, the “Employment Period”). The Employment Period shall end on the fourth
anniversary of the date hereof; provided, that the Employment Period shall
automatically be renewed for successive one-year periods, unless the Company or
Executive gives the other party written notice of the election not to renew the
Employment Period at least 90 days prior to the expiration of the Employment
Period; provided, however, the Employment Period shall be subject to early
termination as provided in Section 3 hereof.

 

2. Terms of Employment.

 

(a) Position and Duties.
During the Employment Period, the Executive shall serve as President and Chief
Executive Officer of the Company with the appropriate authority, duties and
responsibilities as are customarily attendant to such position at other
similarly situated companies with significant private equity ownership,
subject, in all instances, to the general supervisory power of the Company’s
board of directors (the “Board”) under applicable corporate law. During the
Employment Period, the Executive shall serve as a member of the management
committee of BE Holdings, the board of directors of Birds Eye Holdings, Inc.
(“BE Inc.”) and the Board as its Chairman. Upon the termination or expiration
of the Employment Period, Executive shall resign as a member of the management
committee, board of directors or any equivalent body of BE Holdings and its subsidiaries
(including the Company and BE Inc.), as the case may be and such obligation to
resign shall survive the termination of this Agreement.

 

(i) During the
Employment Period, Executive shall report solely and directly to the Board and
excluding any periods of vacation and sick leave to which the Executive is
entitled, Executive agrees to devote substantially all of his business time and
attention to the business and affairs of the Company and to use the Executive’s
reasonable best efforts to perform faithfully and efficiently the duties and
responsibilities assigned to Executive

 

 

hereunder; provided, however,
that Executive may serve as a member of the board of directors of one other
corporation or other entity (and on any committee thereof) if approved by the
Board.

 

(b) Compensation.

 

(i) Annual Base Salary.
Effective immediately, and during the Employment Period, the Executive shall
receive an annual base salary (as in effect from time to time, the “Annual Base
Salary”) of at least $600,000, which Annual Base Salary shall be payable in
regular installments in accordance with the Company’s general payroll
practices. The Annual Base Salary will be subject to periodical review and may
be increased in accordance with Company policy. Once increased, the Annual Base
Salary cannot be decreased.

 

(ii) Annual Bonus.
During the Employment Period, the Executive shall participate in such bonus
arrangements as may be approved by the Compensation Committee of the Board (the
“Compensation Committee”) (the aggregate of all payments made under such bonus
arrangements during any fiscal year being herein referred to as the “Annual
Bonus”). Executive’s “Target Bonus” for any fiscal year will be no less than
$350,000 and shall be payable upon the achievement of the Bonus Criteria (as
defined below) for such fiscal year and such other factors as may be determined
by the Board. In addition, with respect to each fiscal year during the
Employment Period, Executive shall have the opportunity to earn an additional
bonus of at least $400,000 upon the achievement of the Superior Bonus Criteria
(as defined below) for such fiscal year and such other factors as may be
determined by the Board that are communicated to Executive in accordance with
the next sentence. Within the first three months of any fiscal year during the
Employment Period (other than with respect to the fiscal year ending June 30,
2006 (“Fiscal 2006”)), the Board shall in good faith, and in consultation with
Executive, establish and communicate to Executive (x) EBITDA and net debt
reduction targets for the Company and its subsidiaries for such fiscal year
(collectively, the “Bonus Criteria”) and (y) additional extraordinary
performance targets for the Company and its subsidiaries that are reflective of
extraordinary performance (collectively, the “Superior Bonus Criteria”), and
any additional factors or objectives related to the achievement of such
additional bonus. The communication to Executive referred to in the preceding
sentence may be in the form of materials distributed to him as a member of the
Board. The Bonus Criteria for any fiscal year shall be adjusted in good faith
by the Board if the Company or any subsidiary engages in any significant
acquisition or disposition outside the ordinary course of business during such
fiscal year. Notwithstanding the foregoing, subject to Executive’s, continued
employment, Executive shall be entitled to a guaranteed bonus for Fiscal 2006
of $350,000 pro-rated for the actual number of days the Executive was employed
by the Company during Fiscal 2006. The Annual Bonus shall be paid within 30
days of receipt by the Company of the audited financial statements for the
fiscal year of the Company to which it relates. As used herein, “EBITDA” shall
mean the Company’s and its subsidiaries’ earnings before interest, taxes,
depreciation and amortization calculated on a consolidated basis consistent
with the Company’s past practice of calculating “operating EBITDA” for internal
reporting purposes.

 

(iii) Employee Benefit
Plans. During the Employment Period, except as otherwise expressly provided
herein, the Executive shall be entitled to participate in all compensation,
incentive, employee benefit, welfare and other plans and programs and fringe
benefits (collectively, “Employee Benefit Plans”) on a basis no less favorable
than that are

 

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generally provided to any
other senior executive officer of the Company. In addition, within 60 days of
the Effective Date, the Company shall, at its expense, procure a term life
insurance policy covering Executive’s life during the Employment Period in the
face amount of up to $1,500,000 subject to the total cost of such insurance to
the Company being no more than $12,000 per annum, payable to one or more beneficiaries
designated by Executive and Executive shall co-operate and make himself
available for any medical examination reasonably required by the Company in
connection therewith.

 

(iv) Residence in
Rochester. Executive shall establish a permanent residence in the Rochester, NY
area by purchasing a residence as soon as reasonably practicable after the
Effective Date but in any event within six months of the date of this Agreement
and in connection therewith shall be entitled to an one-time expense reimbursement
of reasonable costs and expenses incurred by Executive for purchasing a new
residence in the Rochester, NY area. Such reimbursement shall, in any event,
include (x) reasonable costs and fees incurred in connection with the
search for and purchase of a new residence in the Rochester, New York
metropolitan area, including a reasonable number of house hunting trips for
Executive and his spouse (which shall include air fare, lodging, meals and
other incidental expenses) (other than mortgage discount points) and, the
physical move of Executive’s belongings and family (if and to the extent
applicable) and (y) for a period of six (6) months following the
Effective Date (or, if earlier, until Executive purchases a residence in
Rochester, NY) (A) temporary living expenses of up to $5,000 per month and
(B) two (2) airline tickets per month for travel between Rochester
and Executive’s place of residence. During the Employment Period, Executive
shall perform his duties hereunder during the business week of the Company
(which shall include every business day commencing on Monday and ending on
Friday of each week) at the corporate headquarters of the Company at Rochester,
New York (except when Executive is engaged in business travel in connection
with his responsibilities hereunder).

 

(v) Vacation. During the
Employment Period, Executive shall be entitled to four (4) weeks of paid
vacation during each calendar year, pro-rated, in the case of the 2005 calendar
year, for the actual number of days the Executive was employed by the Company
during the 2005 calendar year. Executive may carry over accrued, unused
vacation to subsequent calendar years but in no event shall Executive be
entitled to utilize more than six (6) weeks of vacation time in any
calendar year.

 

(c) Indemnification and
Insurance. Executive shall be entitled to indemnification, to the fullest
extent permitted by law, as a director or officer of the Company (including
advancement of litigation expenses upon executing a customary undertaking in
favor of the Company to return such advances to the extent it is finally
determined that Executive is not entitled to indemnification) in accordance
with the certificate of incorporation of the Company. The Company shall insure
Executive, or shall cause Executive to be insured, under directors’ and
officers’ liability insurance at the same level as other directors and officers
of the Company are covered from time to time during the Employment Period and a
period of six years thereafter.

 

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3. Termination of Employment.

 

(a) Death, Disability or
Non-renewal. The Executive’s employment shall terminate automatically upon the
Executive’s death during the Employment Period or upon non-renewal of the
Employment Period by the Company or Executive as provided in Section 1
above. If the Company determines in good faith that the Disability of the
Executive has occurred during the Employment Period (pursuant to the definition
of Disability set forth below), it may give to the Executive written notice in
accordance with Section 8(c) of this Agreement of its intention to
terminate the Executive’s employment. In such event, the Executive’s employment
with the Company shall terminate effective on the receipt of such notice by the
Executive (the “Disability Effective Date”). For purposes of this Agreement, “Disability”
shall mean a determination by the Board in its good faith judgment with input
from appropriate medical personnel that Executive is unable to substantially
perform his job responsibilities as a result of chronic illness, physical,
mental or any other disability for a period of 180 days or more in any 365
consecutive day period. The Executive shall co-operate and make himself
available for any medical examination reasonably required by the Company with
respect to any determination of the Disability of the Executive.

 

(b) With or Without
Cause. The Company may terminate the Executive’s employment during the
Employment Period with or without Cause. Any termination of the Executive’s
employment during the Employment Period for Cause shall be made by providing a
Notice of Termination within sixty (60) days of the Board being informed of the
occurrence of the relevant event or events constituting Cause. For purposes of
this Agreement, “Cause” shall mean:

 

(i) Executive is
indicted or charged with, or pleads guilty or nolo contendere to, (A) a
felony or (B) a crime involving moral turpitude that is either materially
detrimental to the Company or that which brings the Company into public
disgrace or disrepute;

 

(ii) in carrying out his
duties hereunder, Executive engages in conduct that constitutes gross neglect
or willful misconduct that, in either case, results in material economic harm
or is materially detrimental to the Company;

 

(iii) Executive breaches
any material provision of the Employment Agreement (including Section 5
hereof), and such breach has not been cured prior to 30 days following notice
from the Company;

 

(iv) Executive engages
in willful gross misconduct in the operation of the Company or in connection
with Company activities that brings the Company into public disgrace or
disrepute;

 

(v) Executive’s repeated
refusal to perform duties or responsibilities as reasonably directed by the
Board; or

 

(vi) Executive engages
in willful misconduct resulting in or intended to result in direct personal
gain to Executive at the Company’s expense.

 

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(c) Good Reason. The
Executive’s employment may be terminated by the Executive for Good Reason. For
purposes of this Agreement, “Good Reason” shall mean a termination by Executive
of his employment on thirty (30) days’ written notice given by him to the
Company following the occurrence of any of the following events, which notice
shall be given within sixty (60) days following Executive becoming aware of
such occurrence, without his express prior written consent, unless all grounds
for termination shall have been fully cured prior to thirty (30) days after he
gives notice to the Company requesting cure:

 

(i) any failure of the
Company to continue Executive as President and Chief Executive Officer of the
Company and as Chairman of the Board provided, that after a Change of Control
(as defined below), failure of the Executive to be appointed or nominated to
the board of directors of a successor shall not constitute “Good Reason”;

 

(ii) any material
diminution in Executive’s responsibilities or authorities under the Employment
Agreement; the appointment of another person whose duties are inconsistent with
Executive’s role as Chief Executive Officer and Chairman of the Board; or the
assignment to Executive of duties that are materially inconsistent with, or
materially impair his ability to perform, the duties then assigned to him; or
any change in the reporting structure so that Executive is required to report
to any person other than the Board; provided that within six months of a Change
in Control, the Company shall have the flexibility to appoint Executive to a
reporting relationship different from that which existed prior to the Change in
Control, to make immaterial changes in Executive’s duties (which changes in the
aggregate shall not be material), or to change Executive’s title provided that
Executive shall not have the stature less than that of a Divisional President,
and it is understood that equivalent positions may have different titles;
provided further that in no event shall any diminution of position, authority,
duties or responsibilities of the Executive resulting solely from the consummation
of one or more dispositions of assets or business lines constitute “Good Reason”
hereunder so long as subsequent to any such disposition the Company’s primary
business continues to be the marketing and sale of branded frozen vegetable
products;

 

(iii) if as a condition
to his continued employment, Executive’s principal place of work is relocated
more than 75 miles from the location of the current corporate headquarters of
the Company in Rochester, New York and Pittsburgh, PA other than any relocation
effected pursuant to a recommendation by Executive;

 

(iv) subject to the
terms and conditions of that certain letter agreement dated as of the date
hereof between BE Holdings and Executive, failure by BE Holdings to issue to
Executive the limited liability company units of BE Holdings specified therein
within the time periods specified therein;

 

(v) any material breach
by the Company of any of its obligations under the Employment Agreement which
has not been cured prior to 30 days following notice from Executive of such
breach; or

 

(vi) any failure of the
Company to obtain the assumption in writing of its obligations under the
Employment Agreement by any successor to all or substantially all of its
business or assets within thirty (30) days after any reconstruction,

 

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amalgamation, combination,
merger, consolidation, sale, liquidation, dissolution or similar transaction;
provided that no such assumption shall be required to be obtained in connection
with any dispositions of assets or business lines by the Company or any of its
subsidiaries so long as subsequent to any such disposition the Company’s
primary business continues to be the marketing and sale of branded frozen
vegetable products.

 

As used herein, “Change in
Control” means the consummation of a transaction, whether in a single
transaction or in a series of related transactions that are consummated
contemporaneously (or consummated pursuant to contemporaneous agreements), with
any other party or parties on an arm’s-length basis, pursuant to which such
party or parties (a) acquire (whether by merger, stock purchase,
recapitalization, reorganization, redemption, issuance of capital stock or
otherwise) more than 50% of the voting stock of the Company or (b) acquire
assets constituting all or substantially all of the assets of the Company and
its subsidiaries on a consolidated basis; provided that nothing in clause (a) or
(b) shall include any dispositions of assets or business lines by the
Company or any of its subsidiaries so long as subsequent to any such
disposition the Company’s primary business continues to be the marketing and
sale of branded frozen vegetable products.

 

(d) Notice of
Termination. Any termination by the Company or by the Executive shall be
communicated by Notice of Termination to the other party hereto given in
accordance with Section 8(c) of this Agreement. For purposes of this
Agreement, a “Notice of Termination” means a written notice which (i) indicates
the specific termination provision in this Agreement relied upon, (ii) to
the extent applicable, sets forth in reasonable detail the facts and
circumstances claimed to provide a basis for termination of the Executive’s
employment under the provision so indicated and (iii) if the Date of
Termination (as defined below) is other than the date of receipt of such
notice, specifies the termination date (which date shall be not more than
thirty days after the giving of such notice). The failure by the Executive or
the Company to set forth in the Notice of Termination any fact or circumstance
which contributes to a showing of Good Reason or Cause shall not waive any
right of the Executive or the Company, respectively, hereunder or preclude the
Executive or the Company, respectively, from asserting such fact or
circumstance in enforcing the Executive’s or the Company’s rights hereunder.

 

(e) Date of Termination.
“Date of Termination” means (i) if the Executive’s employment is
terminated by the Company other than for Disability, the date of receipt of the
Notice of Termination or any later date specified therein within 30 days of
such notice, (ii) if the Executive’s employment is terminated by reason of
death or Disability, the Date of Termination shall be the date of death of the
Executive or the Disability Effective Date, as the case may be, (iii) if
the Executive’s employment is terminated by the Executive, the Date of
Termination shall be thirty days after the giving of such notice by the
Executive provided that the Company may elect to place the Executive on paid
leave for all or any part of such 30-day period and (iv) if the Executive’s
employment is terminated as a result of non-renewal of the Employment Period by
the Company or the Executive pursuant to Section 1, the last day of the
then current Employment Period.

 

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4. Obligations of the Company
upon Termination.

 

(a) Death or Disability.
If, during the Employment Period the Executive’s employment shall terminate on
account of death or Disability the Company shall pay to the Executive or his
estate:

 

(i) the Executive’s
Annual Base Salary through the Date of Termination within 30 days after the
Date of Termination to the extent not theretofore paid; and

 

(ii) an amount equal to
the product of (x) the Annual Bonus that would have been paid to the
Executive for such fiscal year and (y) a fraction, the numerator of which
is the number of days in the fiscal year in which the Date of Termination
occurs through the Date of Termination and the denominator of which is 365, to
the extent not theretofore paid (such amount, the “Accrued Bonus”), at such
time as the Annual Bonus would have been paid in the ordinary course;

 

(iii) to the extent not
theretofore paid or provided, the Company shall timely pay or provide to the
Executive or his estate or beneficiaries (A) a cash lump sum amount equal
to the product of (x) the Executive’s Annual Base Salary and (y) a
fraction, the numerator of which is the number of Executive’s accrued but
unused vacation days and the denominator of which is 365 (the “Accrued Vacation
Amount”) and (B) any other amounts (including any unreimbursed business
expenses) or benefits required to be paid or provided or which the Executive is
eligible to receive under any plan, program, policy or practice or contract or
agreement of the Company and its affiliated companies through the Date of
Termination (the Accrued Vacation Amount and such other amounts and benefits
shall be hereinafter referred to as the “Other Benefits”); and

 

(b) By the Company for
Cause; By the Executive Other than for Good Reason; Non-Renewal by Executive.
If the Executive’s employment is terminated for Cause, the Executive terminates
his employment without Good Reason during the Employment Period or the
Executive elects to not renew the Employment Period pursuant to Section 1,
this Agreement shall terminate without further obligations to the Executive
other than the obligation to pay to the Executive (i) his Annual Base
Salary through the Date of Termination to the extent theretofore unpaid and (ii) the
Other Benefits.

 

(c) By the Company Other
than for Cause, Death or Disability; By the Executive for Good Reason;
Non-Renewal by the Company. If, during the Employment Period the Executive’s
employment is terminated by the Executive for Good Reason or by the Company
other than for Cause, other than on account of death or Disability or as a
result of non-renewal of the Employment Period by the Company pursuant to Section 1:

 

(i) subject to continued
compliance by the executive of the covenants set forth in Section 5
hereof, the Company shall pay to the Executive:

 

(A) the Executive’s
Annual Base Salary through the Date of Termination within 30 days after the
Date of Termination to the extent not theretofore paid; and

 

7

 

(B) the amount equal to
the product of (x) two (2) and (y) the sum of the Executive’s
current Annual Base Salary and Annual Bonus for the preceding fiscal year
(which Annual Bonus shall be deemed to be $350,000 for the purposes of this Section 4(c)(i)(B) if
Date of Termination occurs prior to June 30, 2006), payable during the
period commencing on the Date of Termination and until the termination of the
Restricted Period (as defined below) in regular installments in accordance with
the Company’s general payroll practices;

 

(ii) the Company shall
provide the Executive with the Other Benefits; and

 

(iii) the Company shall
provide the Executive continued coverage under the Company’s group health plans
until the earlier of (x) the expiration of the Restricted Period and (y) the
date Executive becomes eligible for comparable coverage under health plans of
any successor employer.

 

(d) Release. The
severance payments and such benefits to be provided by the Company pursuant to
this Section 4 shall (i) be in lieu of any other payments by the
Company to Executive (other than pursuant to BE Holdings’ limited liability
company agreement) and (ii) be subject to Executive’s execution (other
than in the case of Executive’s death) of a release agreement in substantially
the form attached hereto as Exhibit A,

 

5. Noncompetition;
Nonsolicitation; Etc. Executive acknowledges that in the course of his
employment with the Company he will become familiar with the Company’s and its
subsidiaries’ trade secrets and other confidential information concerning the
Company and such subsidiaries (collectively, the “Confidential Information”)
and that his services will be of special, unique and extraordinary value to the
Company and its subsidiaries. Therefore, Executive agrees that:

 

(a) Noncompetition.
During the Employment Period and until the second anniversary of the date
Executive’s employment with the Company terminates (the “Restricted Period”),
Executive shall not, for himself or on behalf of any other person, firm,
partnership, corporation, or other entity (each a “Person”), engage, directly
or indirectly, as an executive, agent, representative, consultant, partner,
shareholder or holder of any other financial interest in any Person that owns or
operates any business that competes with (i) the frozen vegetable, frozen
fruit, frozen skillet meal or the fruit or pie filling lines of business of the
Company or any subsidiary of the Company (including both branded and
non-branded segments within each line of business) or (ii) any line of
business (other than those currently engaged in by the Company or any of its
subsidiaries) that accounts for 10% or more of the revenues or net operating
cash flows of the Company and its subsidiaries any time during the Employment
Period (collectively, the “Business”). Nothing herein shall prohibit Executive (i) from
being a passive owner of not more than 2% of the outstanding, publicly traded
stock of any class of a corporation engaged in any of the activities described
in the foregoing sentence, so long as Executive has no active participation in
the business of such corporation, (ii) subsequent to the Employment
Period, from being employed by, or otherwise having material association with,
any business that competes materially with the Company in the Business if his
employment or association is with a separately managed and operated division or
Affiliate of such business that does not compete with the Company in any part
of the Business and (iii) subsequent to the Employment Period,

 

8

 

from serving on the board of
directors of any business that is involved in the Business as an immaterial
part of its overall business (i.e., less than 5% of its overall revenues), so
long as Executive recuses himself fully and completely from all matters
relating to any part of the Business. Executive acknowledges that this
Agreement, and specifically, this Section 5, does not preclude Executive
from earning a livelihood, nor does it unreasonably impose limitations on
Executive’s ability to earn a living. In addition, Executive agrees and
acknowledges that the potential harm to the Company of its non-enforcement
outweighs any harm to Executive of its enforcement by injunction or otherwise.

 

(b) Nonsolicitation.
During the Restricted Period, Executive shall not directly or indirectly
through another entity (i) induce or attempt to induce any employee of the
Company or its subsidiaries to leave the employ of the Company or its
subsidiaries, or in any way interfere with the relationship between the Company
or any of its subsidiaries and any employee thereof, (ii) hire any person
who was an employee of the Company or any of its subsidiaries within 180 days
prior to the time such employee was hired by Executive, (iii) induce or
attempt to induce any customer, supplier, licensee or other business relation
of the Company or any of its subsidiaries to cease doing business with the
Company or its subsidiaries or in any way interfere with the relationship
between any such customer, supplier, licensee or business relation and the
Company or any subsidiary or (iv) directly or indirectly acquire or
attempt to acquire an interest in any business relating to the business of the
Company or any of its subsidiaries and with which the Company or any of its
subsidiaries has entertained discussions or has requested and received
information relating to the acquisition of such business by the Company or its
subsidiaries in the one-year period immediately preceding Executive’s
termination of employment with the Company.

 

(c) Confidentiality. The
Confidential Information is property of the Company or its subsidiaries.
Executive further agrees that Executive shall not disclose to any unauthorized
Person or use for Executive’s own purposes any Confidential Information without
the prior written consent of the Board, unless and to the extent that the
Confidential Information becomes generally known to and available for use by
the public other than as a result of Executive’s acts or omissions. Executive
shall deliver to the Company on the Date of Termination, or at any other time
as the Company may request, all memoranda, notes, plans, records, reports,
computer tapes, printouts and software and other documents and data (and copies
thereof) embodying or relating to the Confidential Information, Work Product
(as defined below), or the business of the Company or any subsidiaries which
Executive may then possess or control.

 

(d) Inventions and
Patents. Executive acknowledges that all inventions, innovations, improvements,
developments, methods, designs, analyses, drawings, reports and all similar or
related information (whether or not patentable) which relate to the Company’s
or any of its subsidiaries’ actual or anticipated business, research and
development or existing or future products or services and which are conceived,
developed or made by Executive while employed by the Company and its
subsidiaries (collectively, the “Work Product”) belong to the Company or such
subsidiary. Executive shall promptly disclose such Work Product to the Board
and perform all actions reasonably requested by the Board (whether during or
after the Employment Period) to establish and confirm such ownership
(including, without limitation, assignments, consents, powers of attorney and
other instruments).

 

9

 

(e) Enforcement. The
parties to this Agreement hereby agree and stipulate that (i) the
restrictions contained in this Agreement are reasonable and necessary in order
to protect the Company’s and its subsidiaries’ legitimate business interests
and (ii) in the event of any breach or violation of this Agreement or of
any provision hereof by Executive, the Company and its subsidiaries will have
no adequate remedy at law and will suffer irreparable loss and damage thereby.
The parties hereby further agree and stipulate that in the event of any such
breach or violation, either threatened or actual, the Company’s and its
subsidiaries’ rights shall include, in addition to any and all other rights
available to the Company and its subsidiaries at law or in equity, the right to
seek and obtain any and all injunctive relief or restraining orders available
to it in courts of proper jurisdiction, so as to prohibit, bar, and restrain
any and all such breaches or violations by Executive. The prevailing party to
any legal action, arbitration or other proceeding commenced in connection with
enforcing any provision of this Section 5, including without limitation,
obtaining the injunctive relief provided by this Section 5 shall be
entitled to recover all court costs, reasonable attorneys’ fees, and related
expenses incurred by such party. Executive further agrees that no bond need be
filed in connection with any request by the Company and its subsidiaries for a
temporary restraining order or for temporary or preliminary injunctive relief.

 

(f) Additional
Acknowledgments. Executive acknowledges that the provisions of this Section 5
are in consideration of: (i) employment with the Company, (ii) the
issuance of certain limited liability company interests of BE Holdings to the
Executive and (iii) additional good and valuable consideration as set
forth in this Agreement. In addition, Executive acknowledges (i) that the
business of the Company and its subsidiaries is national in scope and without
geographical limitation and (ii) notwithstanding the state of
incorporation or principal office of the Company or any of its subsidiaries, or
any of their respective executives or employees (including the Executive), it
is expected that the Company will have business activities and have valuable
business relationships within its industry throughout the United States.
Executive acknowledges that he has carefully read this Agreement and has given careful
consideration to the restraints imposed upon Executive by this Agreement, and
is in full accord as to their necessity for the reasonable and proper
protection of confidential and proprietary information of the Company and its
subsidiaries now existing or to be developed in the future. Executive expressly
acknowledges and agrees that each and every restraint imposed by this Agreement
is reasonable with respect to subject matter, time period and geographical
area.

 

6. Successors.

 

(a) This Agreement is
personal to the Executive and without the prior written consent of the Company
shall not be assignable by the Executive otherwise than by will or the laws of
descent and distribution. This Agreement shall inure to the benefit of and be
enforceable by the Executive’s legal representatives.

 

(b) This Agreement shall
inure to the benefit of and be binding upon the Company and its successors and
assigns.

 

10

 

7. 280G Benefits and Excise
Tax.

 

(a) Shareholder
Approval. The Company agrees to notify Executive if there is a high probability
that a 280G Event (as defined below) will likely occur with respect to
Executive, and further agrees that, upon written request of the Executive which
written request (if made) shall include an election by the Executive to
condition his receipt of any 280G Benefits (as defined below) on obtaining the
Shareholder Approval (as defined below), prior to its consummating any transaction
that could cause the Company to be considered to have experienced a change
within the meaning of Section 280G(b)(2)(A)(i) of the Internal
Revenue Code of 1986, as amended from time to time (the “Code”) (a “280G Event”),
the Company shall use commercially reasonable efforts in seeking Company
shareholder approval, pursuant to the requirements set forth at Q&A 7 of
Reg. section 1.280G-1, of payment of such portions of the payments to be made
to or for the benefit of the Executive contingent on such transaction that
would constitute “parachute payments” within the meaning of Section 280G(b)(2) of
the Code (such payments or benefits, the “280G Benefits” and such shareholder
approval, the “Shareholder Approval”), as requested in writing by Executive.
Executive may (but shall not be required to) elect to condition his receipt of
any such payment on obtaining such Shareholder Approval.

 

(b) Cutback.
Notwithstanding any provision of this Agreement to the contrary and if the
Shareholder Approval is not obtained (including as a result of the Executive
failing to elect to condition his receipt of any such payment or benefit on
obtaining Shareholder Approval), and if all or any portion of the payment or
benefits received or realized by Executive pursuant to this Agreement either
alone or together with other payments or benefits which Executive receives or
realizes or is then entitled to receive or realize from the Company or any of
its affiliates would constitute a “parachute payment” within the meaning of Section 280G
of the Code and/or any corresponding and applicable state law provision, such
payments or benefits provided to Executive shall be reduced by reducing the
amount of payments or benefits payable to Executive (using any cash payments
first in the manner designated by the Executive) to the extent necessary so
that no portion of such payments or benefits shall be subject to the excise tax
imposed by Section 4999 of the Code and any corresponding and/or
applicable state law provision; provided that such reduction shall only be made
if, by reason of such reduction, Executive’s net after tax benefit shall exceed
the net after tax benefit is such reduction were not made. For purposes of this
paragraph, “net after tax benefit” shall mean the sum of (i) the total
amount received or realized by Executive pursuant to this Agreement that would
constitute a “parachute payment” within the meaning of Section 280G of the
Code and/or any corresponding and applicable state law provision (as
applicable), plus (ii) all other payments or benefits which Executive
receives or realizes or is then entitled to receive or realize from the Company
and any of its affiliates that would constitute a “parachute payment” within
the meaning of Section 280G of the Code and/or any corresponding and
applicable state law provision (as applicable), less (iii) the amount of
federal or state income taxes payable (as applicable) with respect to the
payments or benefits described in (i) and (ii) above calculated at
the maximum marginal individual income tax rate for each year in which payments
or benefits shall be realized by Executive (based upon the rate in effect for
such year as set forth in the Code or applicable State law (as applicable) at
the time of the first receipt or realization of the foregoing), less (iv) the
amount of excise taxes imposed with respect to the payments or benefits
described in (i) and (ii) above by Section 4999 of the Code
and/or any corresponding and applicable state law provision (as applicable).
The calculations of the various amounts required to be made pursuant to this Section 7(b) shall
be made by the Company’s regular independent accounting firm unless Executive
reasonably

 

11

 

objects to the use of such
firm, in which event such calculations will be made by a nationally recognized
United States public accounting firm chosen by the parties.

 

8.
Miscellaneous.

 

(a) This
Agreement and any dispute, disagreement, or issue of construction or
interpretation arising hereunder whether relating to its execution, its
validity, the obligations provided therein or performance shall be governed or
interpreted according to the internal laws of the State of New York applicable
to contracts entered into and to be performed solely within such State without
regard to choice of law considerations. The parties hereto hereby waive, to the
fullest extent by applicable law, any right to trial by jury with respect to
any action or proceeding arising out of or relating to this Agreement.

 

(b) Any
disputes with regard to this Agreement that is not resolved by mutual
agreement, other than as provided in Section 5(e) hereof, shall be
resolved by binding arbitration before the American Arbitration Association (“AAA”)
in New York City pursuant to the rules of AAA. The arbitration shall be
governed by the United States Arbitration Act, 9 U.S.C. ‘SS’’SS’ 1-16 and shall
be conducted in accordance with the rules and procedures of AAA. Any
judgment upon the reward rendered by the arbitrator may be entered in any court
having jurisdiction thereof. The arbitrator’s decision shall set forth a
reasoned basis for any award of damages or findings of liability. The
arbitrator shall not have the power to award damages in excess of actual
compensatory damages and shall not multiply actual damages or award punitive
damages, and each party hereby irrevocable waives any claim to such damages.
The costs of AAA and the arbitrator shall be borne by the Company. Each party
shall bear its own costs (including, without limitation, legal fees and fees of
any experts) and out-of-pocket expenses; provided, that the Company shall
promptly advance to Executive all reasonable expenses (including attorney’s
fees) up to $25,000 incurred in connection with such dispute, subject to
Executive executing a customary undertaking to repay such advances to the
Company to the extent the Executive does not substantially prevail in such
arbitration.

 

(c) all
notices, demands or other communications to be given or delivered under or by
reason of the provisions of this Agreement will be in writing and will be
deemed to have been given when delivered personally, mailed by certified or
registered mail, return receipt requested and postage prepaid, or sent via a
nationally recognized overnight courier, or sent via facsimile to the recipient
with telephonic confirmation by the sending party. Such notices, demands and
other communications will be sent to the address indicated below:

 

If
to the Executive:

 

Neil
Harrison

760
Fairview Road

Pittsburgh,
PA 15238

Fax:
(412)967-1991

 

12

 

If
to the Company:

 

Birds
Eye Foods, Inc.

90
Linden Place

Rochester,
New York 14625

Telecopy
Number: (585)385-2857

Attention:
Secretary

 

with
a copy to (which shall not constitute notice to the Company):

 

Vestar
Capital Partners IV, L.P.

245
Park Avenue

41st
Floor

New
York, New York 10167

Telecopy
Number: (212)808-4922

Attention:
General Counsel

 

or such other address or to
the attention of such other person as the recipient party shall have specified
by prior written notice to the sending party. Any notice under this Agreement
shall be deemed to have been given when so delivered, sent or mailed.

 

(d) The
Company shall promptly reimburse Executive for reasonable attorneys’ fees of up
to $40,000 he incurs in connection with the negotiation, implementation, and
documentation of this Agreement and other arrangements relating to his
employment with the Company.

 

(e) The
Executive shall not be required to seek other employment during the Restricted
Period subsequent to the termination or expiration of the Employment Period or
to reduce any amounts or benefits payable or to be provided to him under Section 4
hereof, and no such payment or benefit shall be reduced on account of any
compensation received by the Executive from other employment. The Company’s
obligation to pay or provide the amounts or benefits under Section 4
hereof shall not be reduced by any amount owed by the Executive to the Company.

 

(f) Subject
to the provisions of Section 4(c), there shall be no limitation on the
ability of the Company to terminate the Executive at any time with or without
Cause.

 

(g) Whenever
possible, each provision of this Agreement will be interpreted in such manner
as to be effective and valid under applicable law, but if any provision of this
Agreement is held to be invalid, illegal or unenforceable in any respect under
any applicable law or rule in any jurisdiction, such invalidity,
illegality or unenforceability will not affect any other provision or any other
jurisdiction, but this Agreement will be reformed, construed and enforced in
such jurisdiction as if such invalid, illegal or unenforceable provision had
never been contained herein.

 

(h) The
captions of this Agreement are not part of the provisions hereof and shall have
no force or effect. This Agreement may not be amended or modified otherwise

 

13

 

than by a written agreement
executed by the parties hereto or their respective successors and legal representatives.

 

(i) The
Company may withhold from any amounts payable under this Agreement such
Federal, state, local or foreign taxes as shall be required to be withheld
pursuant to any applicable law or regulation.

 

(j) The
Executive’s or the Company’s failure to insist upon strict compliance with any
provision of this Agreement or the failure to assert any right the Executive or
the Company may have hereunder shall not be deemed to be a waiver of such
provision or right or any other provision or right of this Agreement.

 

(k) From
and after the Effective Date this Agreement shall supersede any other
employment agreement between the parties or between the Company and the
Executive with respect to the subject matter hereof.

 

(l) Notwithstanding
anything to the contrary herein, (i) BE Holdings shall prior to the
Effective Date assign this Agreement to the Company and upon such assignment,
the Company shall be deemed substituted for BE Holdings as a party to this
Agreement and BE Holdings shall have no obligations to the Executive hereunder,
(ii) such assignment shall not require the consent of the Executive and (iii) until
such assignment has been effected, the Company shall be a third party
beneficiary of this Agreement and shall be entitled to enforce this Agreement
as if it were an original party thereto.

 

* * * * * * * * *

 

14

 

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

 

 

	
   

  	
  /s/ Neil Harrison

  
	
   

  	
  Neil Harrison

  
	
   

  	
   

  
	
   

  	
  BIRDS EYE HOLDINGS, LLC

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Brian Ratzan

  
	
   

  	
  Title:

  	
  Authorized Person

  
				

 

 

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

 

 

	
   

  	
  /s/ Neil Harrison

  
	
   

  	
  Neil Harrison

  
	
   

  	
   

  
	
   

  	
  BIRDS EYE HOLDINGS, LLC

  
	
   

  	
   

  
	
   

  	
  By:

  	
  Brian Ratzan

  
	
   

  	
   

  	
  Brian Ratzan

  
	
   

  	
  Title:

  	
  Authorized Person

  
				

 

 

Exhibit A

 

FORM OF RELEASE AGREEMENT

 

In
consideration of receipt of severance payments and benefits as set forth in Section 4
of the Employment Agreement, dated as of September 2, 2005, by and between
Birds Eye Holdings, LLC (“BE Holdings”) and Neil Harrison (the “Employment
Agreement”) and subsequently assigned by BE Holdings to Birds Eye Foods, Inc.
(the “Company”), I, Neil Harrison, hereby release and discharge the Company,
and each of its employees, officers, directors, stockholders, agents,
subsidiaries and other affiliates from, and waive any and all claims, demands,
damages, causes of action or suits (collectively, “Claims”) of any kind or
nature whatsoever that I may have had or may now have against any of them
(including, without limitation, any Claims arising out of or related to my
employment with the Company or the termination thereof), whether arising under
contract, tort, statute or otherwise, and whether I know of the claim or not,
including, without limitation, Claims arising under Title VII of the Civil
Rights Act of 1964, the Age Discrimination in Employment Act, the Americans
with Disabilities Act, the Equal Pay for Equal Work Act, and any other
applicable federal, state or local statutes, rules, codes, or ordinances.
Notwithstanding anything herein to the contrary this release does not cover (i) my
rights to the severance payments and benefits provided in Section 4 of the
Employment Agreement or any payments that are due under Birds Eye Holdings, LLC’s
limited liability company agreement; (ii) my rights to any vested or
accrued benefits or rights under the applicable terms of Company plans,
programs, or arrangements; (iii) any Claim by me to enforce the rights
arising under or preserved by the Employment Agreement that survive expressly
survive termination of my employment; and (iv) any Claim by me to enforce
indemnification rights as provided in the Company’s articles of incorporation.

 

I
have not, and shall not hereafter, institute any lawsuit of any kind
whatsoever, or file any complaint or charge, against the Company or any of its
former or present employees, officers, directors, stockholders, agents,
subsidiaries, or affiliates, and any of their successors or assigns, under any
federal, state or local statute, rule, regulation or principle of common law
growing out of events released hereunder. I shall not seek employment or
reemployment with the Company. I acknowledge that I have had at least 21 days
to review and consider this release agreement before accepting it. I have been
advised to consult with an attorney before signing this release agreement.

 

This
release agreement and any dispute, disagreement, or issue of construction or
interpretation arising hereunder whether relating to its execution, its
validity, the obligations provided therein or performance shall be governed or
interpreted according to the internal laws of the State of New York applicable
to contracts entered into and to be performed solely within such State without
regard to choice of law considerations. The parties hereto hereby waive, to the
fullest extent by applicable law, any right to trial by jury with respect to
any action or proceeding arising out of or relating to this release agreement.

 

16

 

	
   

  	
  Acknowledged and Agreed as
  of

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  BIRDS EYE FOODS, INC.

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:Exhibit 10.36

 

CONFIDENTIAL TREATMENT REQUESTED UNDER

C.F.R. SECTIONS 200.80(b)(4), 200.83 AND 230.406.

 

(*****) INDICATES OMITTED MATERIAL THAT IS THE

SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST

FILED SEPARATELY WITH THE COMMISSION.

 

THE OMITTED MATERIAL HAS BEEN FILED

SEPARATELY WITH THE COMMISSION.

 

SUPPLY
AGREEMENT

 

This Agreement is entered into as of August 23,
2005 by and between Congelados Don Jose, S.P.R. de R.L., a Mexican limited
liability company (“Processor”), and Birds Eye Foods, Inc., having its
principal offices at 90 Linden Oaks, Rochester, New York 14625 (“Buyer”).

 

RECITALS

 

A.            Processor is acquiring from Buyer and BEMSA Holding, Inc.
all of the issued and outstanding shares of capital stock of Birds Eye de
Mexico S.A. de C.V. (the “Transaction”), the owner and operator of a frozen
broccoli and cauliflower processing plant located in Celaya, Mexico (the “Celaya
Facility”). Processor also operates facilities at Frexport and CDJ Leon, Mexico
(together with the Celaya Facility, the “Plants”).

 

B.            Buyer wishes to have Processor process and pack at
the Plants and supply and sell to Buyer frozen broccoli and cauliflower food
products on the terms and subject to the conditions set forth herein.

 

C.            (*****)

 

D.            Buyer’s entering into this Agreement was a material
inducement to Processor’s consummating the Transaction, and but for Buyer
entering into this Agreement, Processor would not have consummated the
Transaction.

 

In consideration of the premises hereinafter
set forth, the parties agree as follows:

 

1.             PRODUCTS:  On the terms and subject to the conditions
hereof, Processor shall each Pack Year process, pack, supply, sell and load for
shipping to Buyer the broccoli and cauliflower food products listed on the
attached Exhibit A (the “Products”) in a manner substantially
similar to the past practices of the Celaya Facility. The “Pack Year” is each January 1
through the next December 31 during the term hereof, and the initial “Pack
Year” shall commence on January 1, 2006. Forecasts for the quantities of
the Products for the initial Pack Year and for subsequent Pack Years during the
term of this Agreement shall be provided by Buyer to Processor in accordance
with Section 6. Processor shall also process, pack, supply, sell
and load for shipping to Buyer for the period from the date of this Agreement
to December 31, 2005 (the “Stub Period”) in accordance with the production
schedule for the Stub Period which is attached hereto as Exhibit B
(the “Stub Period Production Schedule”) in a manner substantially similar to
the past practices of the Celaya Facility.

 

 

(a)           For the Stub Period, and
provided Processor is not in material breach under this Agreement, Buyer shall (*****).

 

(b)           Subject to the provisions of
Section 1(e) and provided Processor is not in material breach
under this Agreement, for each Pack Year Buyer shall (*****)

 

(c)           (*****)

 

(d)           (*****)

 

(e)           Notwithstanding anything to the contrary contained in this Agreement, if Processor
and/or Buyer is excused from performance pursuant to Section 21,
then Buyer shall be excused from the requirements of subsections (a), (b) and
(c) of this Section 1 to the same extent.

 

(f)            Payments. The (*****) shall be calculated
annually. All payments pursuant to this Section 1 will be due and payable
within (*****) after receipt
by the applicable party of an invoice for such amount, calculated pursuant to Section 6(b),
via overnight mail, regular mail, courier or hand delivery and any amounts not
paid when due shall thereafter bear interest at the Applicable Rate (as defined
in Section 2(b)).

 

2.             PRICES:

 

(a)           The prices payable by Buyer
for the Products shall initially be as set forth in Exhibit A.

 

(b)           Until December 31,
2007, the prices as set forth in Exhibit A shall not be changed
except by agreement of the parties; provided, however,
that if Buyer deviates from the Targeted Mix Limitations for Products as set
forth on Exhibit A, then Processor shall promptly notify Buyer in
writing of any resultant increases in such prices. If the Buyer fails to pay
such incremental price increase as and when due, such unpaid incremental price
will earn interest calculated at the average prime rate as established in the
Money Section of The Wall Street Journal
(U.S. National Edition) from time to time, adjusted as such rate
changes thereafter and calculated on a daily basis (the “Applicable Rate”)
until such incremental price is paid in full.

 

(c)           Beginning on January 1,
2008, the prices in Exhibit A shall be increased or decreased, in
accordance with the Consumer Price Index — All Urban Consumers (Series ID:
CUUR0000SA0). On January 1, 2008, the prices will be increased or
decreased by the increase or decrease in such index from August 1, 2006 to
November 30, 2007. For all subsequent Pack Year beginning with the fourth
Pack Year, the percentage increase or decrease in such index from the December 1
of the second previous Pack Year through November 30 of the previous Pack
Year shall be referenced when implementing potential adjustments to Product
prices. Notice of price adjustments shall be provided by Processor to Buyer by January 1
of each Pack Year and shall be incorporated into Exhibit A.

 

(d)           Processor guarantees that
throughout the term of this Agreement the prices in Exhibit A, as
adjusted in accordance with this Section 2, shall be no less
favorable than the 

 

2

 

lowest price which Processor extends to any
of its other customers for broccoli and cauliflower products substantially
comparable to the Product during the relevant Pack Year. In the event Processor
sells to any other customers substantially comparable broccoli and cauliflower
products at a lower price than is then in effect under this Agreement during
the relevant Pack year in violation of this Section 2 and the Buyer
provides notice to Processor of such violation, then the affected price for the
subsequent deliveries of the Product under this Agreement, up to the number of
pounds of substantially comparable broccoli and cauliflower products sold at
such lower price, shall be adjusted to such lower price. Processor shall have
15 days from obtaining such notice to revise its invoices to reflect such lower
price, as subsequently adjusted in accordance with this Section 2,
and if Buyer shall have paid invoices for which such lower price should have
been in effect, Processor shall promptly refund to Buyer any overpayment.
Notwithstanding the foregoing, if Processor supplies to Buyer with Buyer’s
consent Products that are not in compliance with the Specifications or that are
of lower grade, or Buyer knowingly accepts such Products, the price guaranty
shall be inapplicable to such Products supplied to Buyer. For purposes of this
Agreement, “comparable broccoli and cauliflower products” shall mean broccoli
and cauliflower products of the same or substantially similar cut, grade,
quality, and specifications as the Products; provided, however, that “comparable
broccoli and cauliflower products” shall not include products which are lower
grade, aged, distressed, or off grade.

 

3.             Buyer has provided Processor
the attached Exhibit C which sets forth various costs advanced by
Buyer relating to the Stub Period for seedlings, chemicals, and the like which
Processor will deduct from the payments Processor makes to growers of broccoli
and cauliflower which have been advanced such costs. Processor shall pay to
Buyer such amounts deducted from its payments to growers of broccoli and
cauliflower which have been advanced such costs on November 30 and December 31,
2005. Buyer will not be liable to pay to Processor amounts deducted from Buyer’s
payments to growers of broccoli and cauliflower to the extent such grower has
not provided the contracted for broccoli or cauliflower to Processor. Buyer has
taken all necessary actions, including advancing sufficient costs to growers,
to ensure the capability of the Processor to provide Products in accordance
with the Stub Period Production Schedule.

 

4.             STANDARDS:

 

(a)           Processor agrees to process
and pack the Products in accordance with good manufacturing practices and the
formulae, quality standards and other specifications attached hereto as Exhibit D
(collectively, the “Specifications”), Buyer represents and warrants that the
Specifications are substantially comparable to Buyer’s past practices and Buyer’s
past specifications at the Celaya Facility and are compatible with the
equipment, facilities and staffing at the Celaya Facility.

 

(b)           Processor’s Plants will be
inspected once annually and certified with a minimum score of 875 by the
American Institute of Baking.

 

(c)           From time to time as may be
deemed necessary by the Buyer, Buyer agrees to assign an employee of Buyer to
inspect the Products and packing procedures for the Products at the Celaya
Facility to determine if the processing and packing of the Products is in
accordance with good manufacturing practices and the Specifications.

 

3

 

5.             TERM:  (*****) At the end of the initial
term, this Agreement shall automatically renew for a term of five (5) years
provided neither party has provided written notice to the other of its intent
to terminate this Agreement as of (*****), which notice shall be
provided no earlier than (*****) and no later than (*****).

 

6.             SCHEDULING; ORDERING:

 

(a)           Buyer shall provide Processor
with a forecast of its expected requirements for the Products for each Pack
Year (including specific requirements for each calendar month)(the “Pack Year
Forecast”). The Pack Year Forecast shall reflect the natural growing season and
historical production patterns of the Products at the Celaya Facility with
calendar month forecasts substantially similar to the historic average monthly
production percentages of Buyer from 2000 through 2004 as set forth in Exhibit E
(the “Historic Monthly Production Percentages”). The initial Pack Year Forecast
(the “Original Forecast”) shall be provided on or before October 1, 2005.

 

(b)           Based upon the Pack Year
Forecast, Processor shall establish scheduling to ensure that the Products will
be processed, packed and shipped in a manner consistent with the terms and
conditions of such forecast. Notwithstanding the foregoing, Processor may
throughout the Stub Period and a given Pack Year provide Products in excess of
or in shortage of the Products forecasted for a given month in order to
accommodate the inherent variations in the growing season for Products so long
as such excess or shortage for a given month in a Pack Year does not deviate by
more than 3,000,000 pounds from the monthly forecast provided in the Pack Year
Forecast and so long as the cumulative excess or shortage from the Pack Year
Forecast for a given calendar half (June 30 & December 31)
of a Pack Year does not deviate by more than 1,000,000 pounds from the
corresponding half year forecast.

 

(c)           The forecasts under
subsection (a) of this Section 6 shall be provided to
Processor no later than the October 1 preceding each Pack Year.

 

(d)           On the date of this
Agreement, Buyer shall issue a blanket purchase order to Processor for at least
the (*****). On or before each October 1 during the term of this
Agreement, Buyer shall issue a blanket purchase to Processor for the greater of
the Pack Year Forecast or the (*****). Any purchase order or
other order (*****) of Products
annually or the Historic Monthly Production Percentages, as applicable, may be
rejected by Processor in its sole discretion. Processor shall invoice Buyer
based upon the actual shipment of Products supplied by Processor pursuant to
subsection (b) of this Section 6. Notwithstanding the
foregoing, Processor shall have the right to invoice Buyer in a given month for
an amount of Product equal to the corresponding monthly forecast in the Pack
Year Forecast if Buyer is in breach of any of its obligations to purchase and
accept Products for a Pack Year or in the Original Forecast if Buyer is in
breach of its obligation to provide a Pack Year Forecast for each Pack Year
under this Agreement, and such breach has not been cured within 10 days after
notice to Buyer.

 

7.             PAYMENT: Buyer
agrees/to pay in immediately available funds all invoices submitted by
Processor within (*****) after the
later of (a) the date of shipment of the Product from Processor’s Plants
or (b) the date of receipt by Buyer of the invoice for such Product via 

 

4

 

overnight mail, regular
mail, courier, or hand delivery. Any sums due Processor that are not paid when
due shall thereafter bear interest at the Applicable Rate.

 

8.             ADJUSTMENT OF STANDARDS: Buyer
reserves the right to alter the Specifications without obtaining the prior
written consent of the Processor no later than ninety (90) days prior to the
commencement of each Pack Year if such alterations are substantially compatible
with the production capabilities of the Celaya Facility and would not,
individually or in the aggregate, result in capital expenditures having to be
made by the Processor or material changes having to be implemented at the
Celaya Facility or in its operations (hereinafter “Permitted Alterations”). If
any Permitted Alteration results in increased costs to Processor or results in
decreased costs to Processor, the price set forth in Exhibit A
shall be adjusted upward or downward as shall be mutually agreed upon between
the parties to reflect such increase or decrease in costs. All alterations
other than Permitted Alterations will require the written consent of Processor
prior to implementation. Any deviation by Processor during a Pack Year from the
Specifications agreed to at the beginning of the Pack Year shall be made only
with the consent in writing of Buyer. Any deviation by Buyer during a Pack Year
or less than 90 days prior to the following Pack Year from the Specifications
agreed to at the beginning of the Pack Year or the prior Pack Year, as
applicable, shall be made only with the consent in writing of Processor.

 

9.             DELIVERY:  Buyer shall take delivery of the Products
FCAJFOB Buyer’s Plants. All prices under this Agreement shall be FCA/FOB
Processor’s Plants and are net of taxes, duties, tariffs, insurance, and shipping
costs.

 

10.           SHIPPING:

 

(a)           Processor shall provide
required staffing and equipment for loading the Products for Buyer into trucks
at the Plant’s shipping dock in a manner consistent with past practices of the
Celaya Facility. Processor shall be responsible for all Mexican customs
documentation and costs relating to the export of Products. Buyer shall be
responsible for the arrangement of and cost for the trucks for shipment of the
Products and shall be responsible for all United States customs documentation
and costs relating to the import of the Products. All shipping of the Products
shall be FCA/FOB the Plant.

 

(b)           Processor shall follow the
reasonable specifications of Buyer consistent with past practices of the Celaya
Facility for unit pattern loads in the preparation of the Products for loading
and shipping.

 

(c)           Buyer shall, at its own
expense, supply the materials, as set forth in Section 11(b), to
meet Buyer’s requirements for shipping. Processor shall allow Buyer to store at
Processor’s Celaya Facility without charge a reasonable supply of materials in
advance of processing the Products consistent with past practices of the Celaya
Facility. The Processor agrees to hold such amounts of supply materials to the
extent that such supply materials do not exceed the storage capacity of the
existing Celaya Facility warehouse as of the date hereof or the historical
storage usage at the Celaya Facility.

 

(d)           I Processor shall be
responsible for loss of or damage to the Products prior to delivery to a
carrier FCA/FOB the Plant and Buyer shall be responsible for any loss of or 

 

5

 

damage to the Products after delivery to a
carrier FCA/FOB the Plant; provided, however,
that Processor shall remain liable for hidden damage caused by Processor which
is not discovered by Buyer until after delivery. All claims for losses from
hidden damage shall be promptly disclosed to Processor, but in any event within
thirty (30) days after delivery, and Processor or its representatives shall be
permitted to inspect such Products. Should any Products be rendered unusable by
virtue of any acts or omissions of Buyer, its agents or any carrier, Buyer
shall remain obligated to pay Processor the prices for such Products.

 

(e)           Processor will reasonably
cooperate with Buyer efforts to store Products offsite.  Buyer may not store Products with the
Processor without Processor’s prior written consent. Any storage on-site at the
Plants or off-site at the Plants shall be at Buyer’s sole cost, expense and
risk.

 

(f)            Processor shall use good
faith efforts to advise Buyer of potential delivery delays and delivery
scheduling conflicts so that Buyer may have an opportunity to plan shipments of
the Products from the Plants accordingly.

 

11.           MATERIALS AND EQUIPMENT:

 

(a)           Except as otherwise set
forth herein, Processor agrees to supply all of the required materials,
ingredients, raw product, equipment, and facilities necessary to perform its
obligations under this Agreement.

 

(b)           Buyer shall, from time to time,
deliver or cause to be delivered to Processor’s Plants, at Buyer’s expense and
risk, except as otherwise provided in this Section 11(b), all
materials required to ship the Products including the bulk tote bins,
slipsheets and/or pallets, master shipping cases, folding cartons (Kliklok),
polybags, wax overwrap, and any labels required for finished goods produced.
Buyer will not be responsible for the tote liners and tape for the master
shipping cases and totes, and, for the 16 Oz. IQF Spears, the liner polybag.
Materials supplied by Buyer shall be subject to the historic shrink rates as in
effect at the Celaya Facility.

 

(c)           Processor agrees to comply
with all regulatory requirements in the storage of materials supplied by Buyer
or procured by Processor pursuant to the provisions of this Agreement and to
store the materials in an orderly manner consistent with past practices of the
Celaya Facility to facilitate inventory of the materials.

 

12.           QUALITY ASSURANCE:

 

(a)           Processor shall provide
Buyer reasonable access, during normal business hours, to Processor’s process
and quality control records for the lots of Products submitted to Buyer for its
approval. Such access shall require prior notice by Buyer and shall be subject
to the reasonable approval of Processor. The intent of this access is to permit
the audit of Processor’s procedures and controls to assure its compliance with
the Specifications. Processor shall provide Buyer with such written reports as
are reasonably requested by Buyer on production, amounts and location of
inventories and totes of the Products.

 

6

 

(b)           Those materials required by Section 11
to be furnished by Buyer, and by Processor for Buyer, shall be of such quality
as to permit processing, packing and shipping of the Products in accordance
with the Specifications and applicable law.

 

(c)           Buyer shall not be obligated
to accept Products which do not meet the Specifications. Any Products which do
not meet the Specifications shall be purchased at the sole discretion of Buyer
at a price to be mutually determined and agreed to by Buyer and Processor; provided, however, that the price guaranty set forth in Section 2(d) shall
be inapplicable to such Products.

 

(d)           All Products shall be
wholesome and fit for human consumption. Each party shall promptly notify the
other of any significant matter relating to any of the Products (including,
without limitation, any consumer complaint; any citation or regulatory action
by any federal, state or local authority or regulatory agency that relates to
the quality of the Products; any bacterial, chemical, pesticide or other
contamination of any of the Products or other condition of any of the Products
that violates or may violate any federal, state or local food and drug law or
regulation; or any mislabeling, misbranding or adulteration of any of the
Products).

 

13.           CODE MARKING:  Processor agrees to mark each shipping
container containing Products in a clear and legible manner using the codes
supplied by Buyer consistent with past practices of the Celaya Facility. All
shipping documents, invoices and releases of Products shall bear code dates of
the packing of the Products consistent with the past practices of the Celaya
Facility.

 

14.           RECORDS AND AUDIT:

 

(a)           Processor agrees to make and
keep accurate books and records currently updated with respect to processing
runs, inventories and shipments of the Products to the Buyer. Consistent with
past practices at the Celaya Facility and upon reasonable advance notice to
Processor, Buyer shall be permitted to inspect as may reasonably be required
such records and make copies thereof to the extent necessary to implement this
Agreement.

 

(b)           Processor agrees to keep
accurate books and records currently updated with respect to invoices and
pricing information relating to Processor’s customers to which it supplies
broccoli and cauliflower products.

 

(c)           Price Guaranty Audit.

 

(i)            Once after every Pack Year Buyer may request a list
of invoice numbers for invoices reflecting purchases of all broccoli and/or
cauliflower by customers of Processor for such Pack Year. For purposes of
verifying compliance with the price guaranty set forth in Section 2(d),
Buyer may choose from the list of invoice numbers specific invoices, not to exceed
ten percent of the total number of invoices provided (the “Specific Invoices”).
Processor will provide the Specific Invoices redacting the name of the customer
and any additional information which may reveal the identity of the customer
for purposes of Buyer’s audit of compliance with the price guaranty set forth
in Section 2(d).

 

7

 

(ii)           If Buyer determines that Processor has violated the
price guaranty of Section 2(d), and that Buyer is entitled to a more
favorable price (a “More Favorable Price”) for a specific quantity of Products,
Buyer shall notify Processor of the More Favorable Price and the quantity of
Products sold at such More Favorable Price stating with reasonable
particularity the basis for Buyer’s conclusion. If Processor agrees that
Products were sold at a More Favorable Price, Processor shall implement the
More Favorable Price for a specified quantity of Products once notified by
Buyer. In addition, if Buyer determines that Processor has violated the price
guaranty of Section 2(d), then Buyer shall be entitled to repeat
the audit process under this Section 2(c) for the given Pack
Year, limited to a review of an additional ten percent of the total number of
invoices provided.

 

(d)           Processor shall maintain
such books and records for each Pack Year for a minimum of three (3) years
after the conclusion of the Pack Year.

 

15.           REGULATORY COMPLIANCE: Processor
shall follow good manufacturing practices in the processing of the Products and
shall comply with all applicable local, state and federal laws and regulations
governing the production of the Products. Notwithstanding the foregoing,
compliance with all applicable laws and regulations with respect to formulae
furnished by Buyer, any labeling or packaging furnished by Buyer and/or the
other Specifications shall be the sole responsibility of Buyer, and Buyer shall
save and hold harmless and indemnify Processor against and from any claim or
liability based upon the noncompliance of such materials and formulae and/or
the other Specifications with such laws and regulations.

 

16.           TITLE AND RISK OF LOSS: Title and
risk of loss to materials furnished by Buyer shall remain with Buyer at all
times. Title and risk of loss to materials furnished, supplied or purchased by
Processor shall remain with Processor until said materials are converted into
the Products and delivered to a carrier FCA/FOB the Plants. Title to the
Products and risk of loss thereto shall be with Processor until delivery of the
Products to a carrier FCA/FOB the Plants, at which time title to the Products
and risk of loss thereto shall pass to Buyer.

 

17.           PROPRIETARY INFORMATION AND
CONFIDENTIALITY:

 

(a)           All trademarks and trade
names and all trade secrets, technical know-how, specifications, formulae,
standards, procedures, new product ideas, manufacturing processes and the like
(“Proprietary Information”) owned by either party hereunder shall at all times
be and remain the exclusive property of such party, and this Agreement shall
not in any manner constitute a license to either party to use the Proprietary
Information of the other party, except as necessary for the proper performance
of this Agreement. For purposes of this Section 17, Proprietary
Information of the Processor shall include all information disclosed pursuant
to Section 14.

 

(b)           Each party shall keep
confidential any and all Proprietary Information which is disclosed to it by
the other party during the performance of this Agreement. Proprietary
Information shall not be disclosed without the express written consent of the
party owning such Proprietary Information.

 

8

 

(c)           This Section 17
shall not apply to any Proprietary Information that: (i) is or becomes
public knowledge through no fault of the other party; (ii) is
independently disclosed to the other party by a third person not obligated to
the party owning such Proprietary Information; (iii) was independently
developed or known by the other party prior to the date of this Agreement or is
hereafter independently developed by the other party; or (iv) the other
party is required by law to disclose.

 

18.           PURE FOOD GUARANTEE:

 

(a)           Processor guarantees that no
articles of food sold by Processor to Buyer hereunder will be adulterated or misbranded
within the meaning of the Federal Act, or within the meaning of any state food
and drug law the adulteration and misbranding provisions of which are identical
with or substantially the same as those found in the Federal Act, and that such
goods will not be produced or shipped in violation of Sections 404 (21 U.S.C.S.
§ 344) or 301(d) (21 U.S.C.S. § 331(d)) of said Federal Act; provided, however, that Processor does not guarantee against
such goods becoming adulterated or misbranded within the meaning of said Act or
Acts (i) by reason of materials furnished to Processor by Buyer, (ii) by
reason of Processor’s compliance with the Specifications and/or (iii) after
delivery.

 

(b)           With respect to materials
furnished to Processor by Buyer, Buyer hereby guarantees to Processor that each
shipment or other delivery of materials made by Buyer pursuant to this
Agreement, as of the time of delivery to Processor, shall not be adulterated or
misbranded (within the meaning of the Federal Food Act, or within the meaning
of any state food and drug law the adulteration and misbranding provisions of
which are identical with or substantially the same as those found in the
Federal Act, or when applied to the Products, cause the Products to be
adulterated or misbranded within the meaning of such Acts, and shall not be an
article or articles which is prohibited by such Acts from being introduced into
interstate commerce. Buyer also guarantees that compliance by Processor with
the Specifications will not cause the Products to be adulterated or misbranded
within the meaning of such Acts. Buyer further guarantees that said shipment of
materials shall comply with all applicable federal, including the Federal Act,
state and local laws, rules and regulations and with the Specifications.

 

19.           INDEMNIFICATION:

 

(a)           Processor agrees to
indemnify and hold harmless Buyer against and from any claim, loss, damage,
liability or expense for bodily injury, death or property damage where such
injury, death or damage is caused by any ingredients or materials furnished by
Processor which do not comply with the Specifications, by any negligence of
Processor or by any act or omission on the part of Processor in violation of
this Agreement.

 

(b)           Buyer agrees to indemnify
and hold harmless Processor against and from any claim, loss, damage, liability
or expense for bodily injury, death or property damage where such injury, death
or damage is caused by any formulae or other Specifications or materials
furnished by Buyer to Processor, by any negligence of Buyer, or by any act or
omission on the part of Buyer in violation of this Agreement.

 

9

 

(c)           The foregoing
indemnifications are conditioned upon the party claiming indemnification
promptly furnishing the other party with written notice of each claim, loss,
damage, liability or expense for which indemnity will be claimed and permitting
the indemnifying party to assume the defense thereof at its sole cost and
expense.

 

20.           INSURANCE:

 

(a)           Buyer and Processor shall
each maintain during the term of this Agreement a policy of commercial general
liability insurance, including product liability coverage, with combined single
limits of not less than $5,000,000 United States dollars. Each party shall name
the other as an additional insured under such policy and shall furnish to the
other upon request evidence of such insurance in the form of a certificate
issued by its respective insurance carrier, which certificate shall provide
that there shall be no material change in, or cancellation of, such insurance
unless thirty (30) days prior written notice of such change or cancellation is
given to both parties.

 

(b)           Processor agrees to insure
Buyer’s materials and the Products in the possession of Processor against
damage by fire and extended coverage perils during the period Processor has the
risk of loss therefore.

 

21.           FORCE MAJEURE:  Neither party shall be liable to the other
party for any delay or failure to perform any of its obligations hereunder
which delay or failure to perform is due to fires, storms, floods, earthquakes,
droughts, freezing, hail, other acts of God (including without limitation weather),
war, terrorism, insurrection, riots, or governmental action, orders, or
regulations, and shall give the other party prompt notice of the occurrence of
any such event.

 

22.           TERMINATION:  Without prejudice to any other rights either
party may have under this Agreement, applicable law or rule of equity,
Buyer and Processor, as applicable, shall have the option and right to
terminate this Agreement by giving written notice thereof to the other party
upon the occurrence of any of the following events (provided that termination
by a party pursuant to this Section 22 shall not relieve the party
so terminating from the obligations incurred under this Agreement through the
date of termination):

 

(a)           The other party commits a
material breach of any teriff, covenant or condition of this Agreement and such
breach is not remedied within ninety (90) days after the non-breaching party
has sent written notice of such breach to the breaching party;

 

(b)           The other party becomes
insolvent within the meaning of any bankruptcy or insolvency law, or makes an
assignment for the benefit of its creditors; or

 

(c)           In respect of a termination
by Processor only, if Buyer fails to satisfy the (*****) or the (*****).

 

23.           ADDITIONAL SUPPLY:

 

(a)           (*****); provided
that Processor’s price for supplying such products to Buyer, including the cost
of transportation to Buyer’s facility where such product is required, meets or
is lower than any other reputable manufacturer’s bona fide price for supply
(including 

 

10

 

the cost of transportation to Buyer’s
facility where such product is required), provided further
the performance standards of Processor including, time of delivery, quality of
product and product specifications, are substantially similar or superior to
the performance standards of any other such manufacturer so long as such
specifications are substantially similar to or less stringent than the
Specifications, and provided further
that such (*****).

 

(b)           In the event Buyer exits the
private label business for which the Products are required, Buyer shall use
reasonable commercial efforts to encourage its private label customers to
obtain broccoli and/or cauliflower products from the Processor, including
introducing Processor to Buyer’s customer contact, if feasible, and providing
Processor with the contact information for Buyer’s customer contact and copies
of any requests for bids or proposals with respect to such business that Buyer
has exited or intends to exit by not bidding. In no event will Buyer have any
liability to Processor if such customers choose to obtain product from other
manufacturers.

 

24.           ASSIGNMENT:  Neither party may assign or otherwise
transfer this Agreement, or any of its rights and obligations hereunder, or any
portion thereof, without the prior written consent of the other party, except
that, without such consent, a party may make such assignment to a successor by
consolidation or merger or to an entity which purchases all or substantially
all of the assets and business of such party. If there will be a change of
control of Buyer or if there will be an assignment of this Agreement to a
successor to Buyer by consolidation or merger or to an entity which purchases
all or substantially all of the assets or business of Buyer or otherwise, then,
subject to any confidentiality restrictions applicable to Buyer, Buyer shall
notify Processor within ten (10) days after entering into a definitive
agreement for such transaction or within ten (10) days after such change
of control, assignment by consolidation or merger or sale of all or
substantially of the assets or business of Buyer is consummated.

 

25.           NOTICES: All notices
given by the parties hereunder shall be in writing and shall be (a) personally
delivered, (b) sent via recognized courier service or (c) sent via
facsimile for which the sending party receives written verification of a report
evidencing receipt and sends a copy by regular mail or courier, to the address
set forth below or to such address as a party shall designate in writing to the
other party. Notices shall be deemed given when delivered personally, placed
with such courier, or sent via such facsimile, and shall be deemed received on
the date of receipt of personal delivery or delivery by courier or sent via
such facsimile.

 

To Buyer:

 

BIRDS EYE FOODS, INC.

90 Linden Oaks

Rochester, New York 14625

Attn: Elizabeth J. Robinson, Esq.

Facsimile:  (585) 381-0224

 

With a copy to (which shall not constitute notice to
Buyer):

 

Harris Beach PLLC

99 Garnsey Road

 

11

 

Pittsford, New York 14534

Attn: David M. Mehalick, Esq.

Facsimile:  (585) 419-8817

 

To Processor:

 

Congelados Don Jose, S.P.R. de R.L.

c/o Organizacion Altex, S.C.

Paseo de las Palmas 820 2o. Piso

Lomas de Chapultepec, Mexico, D.F. 11000

Attention:      Roberto J. Servitje

Facsimile: (52) 5540-8378

 

With a copy to (which shall not constitute notice to
Processor):

 

Mayer, Brown, Rowe & Maw LLP

71 South Wacker Drive

Chicago, IL 60606-4637

Attn:       Douglas A. Doetsch

                Christian W.
Fabian

Facsimile: (312) 706-8535

 

26.           ENTIRE AGREEMENT:  It is agreed that neither party has made or
is making any representations or warranties, express or implied, including
without limitation warranties as to merchantability or fitness for a particular
purpose (which warranties are expressly disclaimed), not explicitly set forth
in this Agreement, that this Agreement is the entire agreement between the
parties hereto, and that this Agreement cancels and supersedes all earlier
agreements, written or oral, and that no waiver, modification or change of any
of the terms of this Agreement shall be valid unless in writing. Preprinted or
other terms and conditions appearing on the face of or reverse sides, if any.
of any invoice or other preprinted document used by either party shall not
apply to or become a part of this Agreement, whether or not signed, unless the
same complies with this Agreement. In the event of a conflict, the terms and
conditions of this Agreement shall control.

 

27.           SEVERABLE CONDITIONS:  If any condition, term or covenant of this
Agreement shall at any time be held to be void, invalid or unenforceable, such
condition, covenant or term shall be construed as severable and shall attach
only to such condition. covenant or term, and shall not in any way affect or
render void, invalid or unenforceable any other condition, covenant or term of
this Agreement which shall be carried out as if such void, invalid or
unenforceable term were not embodied herein.

 

28.           SUCCESSORS AND ASSIGNS:  This Agreement shall inure to the benefit of
the parties and their permitted successors and permitted assigns (provided the
assignment does not violate the terms hereof) and shall be binding upon the
parties and their permitted successors and permitted assigns.

 

12

 

29.           DISPUTE RESOLUTION,
MEDIATION, ARBITRATION:

 

(a)           Dispute Resolution.  The parties agree that they shall attempt to
resolve any dispute arising out of, relating to, or having any connection with
this Agreement, including any dispute regarding its existence, validity,
interpretation, performance, breach or termination, and any tort or other
common law or statutory claims arising out of or relating to its negotiation,
execution or performance, by amicable negotiations. If either party gives
written notice (the “Written Notice”) to the other Party that a dispute has
arisen, the parties shall first attempt to resolve the dispute promptly by
negotiation between executives of each party with sufficient authority to
settle the dispute. If these executives are unable, within forty five (45)
business days of delivery of the Written Notice, to resolve the dispute (or
such longer period if agreed to by the parties in writing), then, upon further
Written Notice by either party to the other may be submitted to arbitration,
unless the unsettled dispute relates to quality of the Products or compliance
with the Specifications, in which case it shall be submitted to mediation in
accordance with clause (b) below prior to the commencement of arbitration.

 

(b)           Mediation of Quality and Specification Disputes. (i) The
parties agree to act in good faith to participate in the mediation of any
unsettled dispute relating to quality of the Products or compliance with the
Specifications, and to identify a mutually acceptable mediator. In appointing
the mediator, the Parties shall select a reputable expert to mediate the
dispute. The parties agree that, for purposes of assisting in the mediation
process, they shall jointly engage a reputable technical expert. If for any
reason a mediator cannot be agreed upon by the parties, each party shall
designate a mediator and those mediators shall select a third mediator, who
shall act as the actual mediator for the dispute.

 

(ii)           All offers, promises, conduct and statements,
whether oral or written, made in the course of the mediation by any of the
parties, their agents, employees, experts and attorneys, and by the mediator,
are confidential, privileged and inadmissible for any purpose, including
impeachment, in any arbitration involving the parties, provided that evidence
that is otherwise admissible or discoverable shall not be rendered inadmissible
or non-discoverable as a result of its use in the mediation.

 

(iii)          The parties agree that they will share equally in
the costs of the mediation.  If the
dispute is successfully resolved in the mediation, its resolution shall be
documented by a written agreement to be executed by all parties to the dispute.

 

(c)           Arbitration.  (i) If the parties cannot successfully
resolve the dispute, the dispute shall then be exclusively and finally settled
under the Rules of Arbitration of the International Chamber of Commerce by
three arbitrators appointed in accordance with the said Rules (the “Rules”),
and within the terms set forth below.

 

(ii)           The provisions of Sections 29(a),(b) and (c)(i) may
be enforced by any court of competent jurisdiction, and the party seeking
enforcement shall be entitled to an award of all costs, fees and expenses,
including attorneys’ fees, to be paid by the party against whom enforcement is
ordered.

 

(iii)          The arbitrators shall be and remain at all times
impartial and independent of the parties. The arbitrators must be fluent in the
English language. No party shall engage in any ex parte communication with any
member of the Arbitral 

 

13

 

Tribunal regarding the substance of the arbitration or any claims being
presented to the Arbitral Tribunal.

 

(iv)          Except as agreed by the parties, the Arbitral
Tribunal shall have no power to alter or modify any terms or provisions of this
Agreement, or to render any award which, by its terms or effects, would alter
or modify any term or provision of this Agreement.

 

(v)           The Arbitral Tribunal shall not cease to have
jurisdiction by reason of any claim that the contract is null and void or
allegation that it is non-existent. The Arbitral Tribunal shall continue to
have jurisdiction to determine the respective rights of the parties and to
adjudicate their claims and pleas even though the contract itself may be
non-existent or null and void. The parties also agree that the Arbitral
Tribunal shall have the exclusive power to determine the scope of its own
jurisdiction.

 

(vi)          The place of the arbitration shall be Houston,
Texas.

 

(vii)         Discovery shall be permitted in connection with the
arbitration only to the extent, if any, expressly authorized by the Arbitral
Tribunal upon a showing of substantial need by the party seeking discovery. It
is the expressed intent of the parties that discovery shall be limited and
shall be handled expeditiously. It is also the intent of the parties that they
be required only to produce relevant and non-privileged documents or copies
thereof requested by the other parties to the extent that such documents are
identified with reasonable particularity.

 

(viii)        All aspects of the arbitration, including any
documentary evidence given by a party or witness in the arbitration, shall be
treated as confidential.

 

(ix)           The parties expressly agree that prior to the
formation of the Arbitral Tribunal, nothing in this Agreement shall prevent the
parties from applying to a court of competent jurisdiction for provisional or
interim measures or for injunctive relief as may be necessary to safeguard the
property or rights that are the subject matter of the arbitration. After the
Arbitral Tribunal is impaneled, the arbitrators shall have the power to grant
any remedy or relief they deem just and equitable, whether interim and/or
final, and any provisional measures ordered by the Arbitral Tribunal may be
immediately and specifically enforced by any court of competent jurisdiction.
Each party hereto retains the right to seek interim measures from a judicial
authority, and any such request shall not be deemed incompatible with the
agreement to arbitrate or a waiver of the right to arbitrate.

 

(x)            The Arbitral Tribunal shall have the exclusive power
to consider any defense that all or part of the claims being asserted in the
arbitration are not timely by reason of any applicable statute of limitations,
and the merits of such defenses before determining the substantive merits of
such claims, unless the Arbitral Tribunal determines that the merits of any
asserted limitations defense is sufficiently intertwined with the substantive
merits of the claims being asserted as to make impractical or inefficient the
determination of the merits of the limitations defense as a preliminary matter.

 

14

 

(xi)           The costs of the arbitral proceeding, including
attorney’s fees and expenses, shall be borne in the manner determined by the
Arbitral Tribunal. The award may include interest from the date of any breach
or violation of this Agreement, as determined by the Arbitral Tribunal, until
paid in full, at the Applicable Rate.

 

(xii)          The Arbitral Tribunal shall issue its decision in
the form of a reasoned written award. The arbitral award shall be final and
binding on the parties. Judgment on the award may be entered in any court of
competent jurisdiction over the person or property of the person against whom
enforcement of the judgment is sought.

 

(d)           The parties agree that,
except as otherwise provided in this Agreement, the procedures set forth herein
constitute the exclusive means to resolve any controversy or claim between the
parties. If any of these provisions are determined to be invalid or
unenforceable, the remaining provisions shall remain in effect and binding on
the parties to the fullest extent permitted by law.

 

30.           INTERPRETATION:  When a reference is made in this Agreement to
an Article or a Section, such reference shall be to an Article or a Section of
this Agreement unless otherwise indicated. Any table of contents, list of
defined terms and headings contained in this Agreement are for reference
purposes only and shall not affect in any way the meaning or interpretation of
this Agreement. Whenever the words “include,” “includes” or “including” are
used in this Agreement, they shall be deemed to be followed by the words “without
limitation.” All references to $ or Dollars shall mean United States Dollars.

 

31.           CONFIDENTIALITY:  The parties agree to keep the terms of this
Agreement strictly confidential; provided, however,
that each party may disclose this Agreement to its respective employees and
professional advisors that have a legitimate reason to know such information
and that agree to keep the terms of this Agreement strictly confidential.
Unless mutually agreed to by the parties, no party will issue any press release
or make any public announcement relating to the subject matter of this
Agreement without the prior written approval of the other party.
Notwithstanding the foregoing, a party may, upon advice of legal counsel,
disclose only that portion of this Agreement or its terms legally required to
be disclosed, provided that such party promptly notifies the other party in
advance of making any such disclosure and reasonably cooperates with the other
party to limit such disclosure, including applying for protective orders or
confidential treatment.

 

32.           CHOICE OF LAW:  This Agreement
will be governed by the laws of the State of New York without regard to
conflicts of laws principles.

 

15

 

IN WITNESS WHEREOF. the parties have caused this
Supply Agreement to be executed as of the date first above written.

 

	
  Buyer:

  	
   

  	
  Processor:

  
	
   

  	
   

  	
   

  
	
  BIRDS EYE FOODS, INC.

  	
   

  	
  CONGELADOS DON JOSE,
  S.P.R. DE R.L.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ Timothy J. Benjamin

  	
   

  	
  By:

  	
  /s/ Roberto J. Servitje

  
	
  Name:

  	
  Timothy J. Benjamin

  	
   

  	
  Name:

  	
  Roberto J.Servitje

  
	
  Title

  	
  Vice President

  	
   

  	
  Title:

  	
  President of the Board of
  Directors

  

 

 

EXHIBIT A

PRODUCTS/PRICE

 

(*****)

 

 

EXHIBIT
B

(*****)

 

 

EXHIBIT
C

 

See
attached excel spreadsheet.

 

 

Birds Eye Foods Inc - Celaya
Plant

 

	
   

  	
   

  	
  August 18, 2005

  	
   

  
	
  Warehouse

  	
   

  	
   

  	
  3,04  ,160

  	
   

  
	
  Celaya

  	
   

  	
   

  	
  2,841,377

  	
   

  
	
  Greenhouses

  	
   

  	
   

  	
  202,783

  	
   

  
	
  Greenhouses

  	
   

  	
   

  	
  730,209

  	
   

  
	
  Total Cost

  	
   

  	
   

  	
  827,209

  	
   

  
	
  Expenses

  	
   

  	
   

  	
  (97,000,00

  	
  )

  
	
  Finished goods & Raw
  Mat

  	
   

  	
   

  	
  2,634

  	
   

  
	
  Finished Goods

  	
   

  	
   

  	
  2,634

  	
   

  
	
  Raw Material

  	
   

  	
   

  	
   

  	
   

  
	
  Growers

  	
   

  	
   

  	
  2,361,902

  	
   

  
	
  North of the State

  	
   

  	
   

  	
  783,779

  	
   

  
	
  Bajio Area

  	
   

  	
   

  	
  951,601

  	
   

  
	
  15/16 & 18 August’05

  	
   

  	
   

  	
  317,340

  	
   

  
	
  External Green Houses

  	
   

  	
   

  	
  309182

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Total

  	
   

  	
   

  	
  6,138,905

  	
   

  
	
  Payables

  	
   

  	
   

  	
  (896,643

  	
  )

  
	
  Payable to growers

  	
   

  	
   

  	
  (72,832

  	
  )

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Net effect

  	
   

  	
   

  	
  5,169,430

  	
   

  
	
  exchange rate

  	
   

  	
   

  	
  10.6088

  	
   

  
	
  Dollar amount

  	
   

  	
   

  	
  487,278

  	
   

  

 

 

EXHIBIT D

SPECIFICATIONS

 

(*****)

 

 

EXHIBIT E

(*****)

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00165-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00165-of-00352.parquet"}]]