Document:

a5913480ex10r.htm

    Exhibit
10(r)

     

    AMENDED AND RESTATED
EMPLOYMENT AGREEMENT

     

    

     

    THIS AMENDED AND RESTATED AGREEMENT
(“Agreement”) is dated as of December 23, 2008, between TASTY BAKING COMPANY, a
Pennsylvania corporation (the “Company”), and CHARLES P. PIZZI
(“Executive”).

     

    W I T N E S S E T
H:

     

    WHEREAS, the Company and Executive
entered into an Amended and Restated Employment Agreement dated as of July 27,
2006 and a First Amendment to Amended and Restated Employment Agreement dated as
of September 25, 2007 (collectively, the “Original Agreement”), regarding the
employment of Executive as the President and Chief Executive Officer of the
Company effective October 7, 2002.

     

    WHEREAS, Executive and the Company
desire to amend and restate the Original Agreement to incorporate the currently
effective provisions of the Original Agreement into a single document, to amend
and/or modify certain provisions and to conform the Original Agreement to the
non-qualified deferred compensation provisions of Section 409A of the Internal
Revenue Code of 1986, as amended and the regulations promulgated thereunder (the
“Code”), incorporate prior amendments and make certain clarifying
changes.

     

    NOW, THEREFORE, in consideration of the
mutual covenants herein contained and of the mutual benefits herein provided,
and intending to be legally bound hereby, the Company and Executive hereby amend
and restate the Original Agreement, effective as of January 1, 2009, except as
otherwise stated herein, as follows:

     

    Section
1.                      Term of
Employment.  The Company hereby employs Executive as President
and Chief Executive Officer of the Company, and Executive accepts such
employment by the Company, on the terms and conditions herein contained and
subject to termination only as hereinafter provided.  The term of
employment of Executive under this Agreement shall commence on October 7, 2002
(the “Commencement Date”) and effective, July 27, 2006, July 27, 2007 and July
27, 2008, the Agreement renewed for a three (3)-year term and shall be renewed
for an additional three (3)-year term on every one year anniversary of July 27,
2008 thereafter, unless either party gives notice of non-renewal to the other
party in writing at least ninety (90) days prior to July 27 of the applicable
year.  Upon termination of this Agreement, Employee shall be eligible
only for the benefits set forth in Section 6 hereof and he shall be entitled to
no other benefits.  The period from the Commencement Date through the
termination or expiration of the term of this Agreement (including all renewal
terms) is referred to as the “Employment Period”.  The Company shall
use best efforts consistent with the faithful discharge of the fiduciary duties
of the Board to cause Executive to be elected to the Board and retained as
a  member of the Board during the term hereof.

     

    Section
2.                      Duties.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

       

    

    (a)           During
the Employment Period, Executive shall serve as President and Chief Executive
Officer of the Company and shall have such other duties, responsibilities and
authority and perform such other services for the Company as are consistent with
Executive’s background, training and experience as may from time to time be
assigned to Executive by the Board of the Company.

     

    (b)           During
the Employment Period, Executive shall use his best efforts to carry out his
duties and responsibilities hereunder and devote his entire working time and
effort to the business and affairs of the Company (except for permitted
vacation, illness or disability) and shall not, in any advisory or other
capacity, work for any other individual, firm or entity without first having
obtained the written consent of the Board.  Notwithstanding the
foregoing, nothing contained in this Agreement shall preclude Executive from
devoting reasonable periods of time to serve on the boards of directors of other
organizations, including charitable and community organizations, provided that
such activities do not interfere in any material fashion (as determined by the
Board in its sole discretion) with the regular and satisfactory performance of
Executive’s duties under this Agreement, and, in the sole judgment of the Board
(or any committee thereof), do not compete with or present a conflict of
interest with the interests of the Company.

     

    (c)           Employee
agrees to provide reasonable cooperation at the request of the Company in any
efforts to obtain “key-man” life insurance on Executive’s life.

     

    Section
3.                      Compensation.

     

    (a)           During
the Employment Period, the Company shall pay Executive a base salary at the
annual rate of no less than Four Hundred Thousand Dollars ($400,000), which
amount may be increased from time to time at the discretion of the Board in
accordance with the Company’s existing policy regarding general
increases.  Payment shall be made in accordance with the Company’s
regular practice for Senior Executive (as defined in Section 4(a) below)
employees as in effect from time to time.

     

    (b)           In
addition to Executive’s base salary, as increased from time to time, Executive
shall be entitled to participate in the normal course of business in the Annual
Incentive Plan of the Company (a copy of which has been provided to Executive)
and to receive annually such cash bonus payments as may be granted to him under
such Plan from time to time.  The target bonus, size of the bonus pool
and bonus allocated to each participant in any year are subject to the
discretion of the Compensation Committee of the Board and to the approval of the
Board.

     

    Section
4.                      Additional
Perquisites.

     

    (a)           The
Company will reimburse Executive for all reasonable expenses properly incurred
by Executive in the performance of Executive’s duties hereunder in accordance
with policies established from time to time by the Board for employees who have
either an Employment Agreement or a Change of Control Agreement with the Company
(“Senior Executives”).

     

    
      
        
        

      

      
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    (b)           During
the Employment Period, Executive shall be entitled to participate, in accord
with the terms thereof, in any present or future bonus, life insurance,
disability insurance, medical insurance, pension, Supplemental Executive
Retirement Plan, Thrift, ESOP, Restricted Stock Incentive Plan, long-term
incentive plan, stock option (whether incentive or non qualified) or other
employee benefit, compensation or incentive plan adopted by the Company in which
Senior Executives are generally permitted to participate.

     

    (c)           In
the event Executive elects not to obtain life insurance (in excess of the basic
Ten Thousand Dollars ($10,000) of coverage paid for by the Company) under the
Company’s life insurance program for executives, but maintains or obtains life
insurance through other policies, the Company agrees to reimburse Executive for
the cost of such other insurance up to the amount which the Company would have
paid for an equivalent amount of life insurance under the Company’s life
insurance program.  Executive acknowledges that the amount reimbursed
by the Company will be reported as W-2 income to Executive.  In
addition, provided Executive is in good health and insurable at regular rates,
the Company shall obtain for the benefit of Executive, and maintain at all times
during the Employment Period and pay the premiums for, a term life insurance
policy in the amount of Two Million Dollars ($2,000,000.00) for the period
beginning on October 7, 2007 and ending on the termination or expiration of the
Employment Period.  Executive shall be the owner of such policy
(unless such insurance is effected through the Company’s group life insurance
program) and shall have the sole right to designate the beneficiaries of such
policy.  Executive acknowledges that the company will report as W-2
income to Executive the premiums paid on such policy.

     

    (d)           During
the Employment Period, the Company shall provide Executive with the exclusive
personal and business use of an automobile (and bear all costs of fuel,
maintenance, repairs and insurance thereon) of a make, quality and cost
consistent with the Company’s policies from time to time in effect with regard
to vehicles for Senior Executives, or a replacement automobile of similar
prestige, appointments and cost.  Executive acknowledges that the
Company will report as W-2 income to Executive the value of the personal use of
such vehicle.

     

    (e)           Executive
shall be entitled to paid vacation (taken consecutively or in segments) in
accordance with the vacation policy of the Company as it exists for Senior
Executives from time to time, currently six (6) weeks during each fiscal year,
adjusted pro rata for any partial fiscal year during the term
hereof.

     

    (f)           During
the Employment Period, the Company shall reimburse Executive for the dues and
fees for membership at not more than two (2) business or country clubs of his
choosing, subject to the approval of the Compensation Committee of the
Board.  Executive acknowledges that the amount reimbursed by the
Company will be reported as W-2 income to Executive.

     

    (g)           The
Company shall provide to Executive supplemental retirement income benefits in
accordance with the terms of the supplemental executive retirement plan
agreement attached hereto as Exhibit A
(“SERP”).

     

    
      
        
        

      

      
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    (h)           Beginning
July 27, 2006, and continuing during the term of this Agreement, the Company
shall reimburse Executive for up to Ten Thousand Dollars ($10,000) per annum for
personal professional services. Executive acknowledges that any such
reimbursements will be reported by the Company as W-2 income to
Executive.

     

    Section
5.                      Termination of
Employment.

     

    (a)           This
Agreement and the Employment Period shall cease and terminate upon the
occurrence of any of the events specified below:

     

    (i)           On
the date of the death of Executive;

     

    (ii)          By
the Company in the event Executive shall become and remain “totally disabled” as
defined in Section 5(c) below;

     

    (iii)         By
the Company for “cause” as defined in Section 5(b) below;

     

    (iv)          By
the Company at any time without cause;

     

    (v)           By
Executive for “Good Reason” as defined in Section 5(d) below;

     

    (vi)          Upon
the expiration of the then current term of this Agreement if either the Company
or Executive gives timely notice of its or his election not to renew this
Agreement;

     

    (vii)         By
Executive at any time without Good Reason by resigning and giving the Company 90
days prior written notice thereof;

     

    (viii)        Either
by Executive at any time during the period beginning six (6) months after a
“Change of Control” as defined in Section 5(e) below and ending eighteen (18)
months after such Change of Control, by giving written notice to the Company
ninety (90) days prior to the effective date of such termination, or by the
Company (other than for cause) at any time during the period ending on the last
day of the eighteenth (18th) calendar month following the date of such Change of
Control; and

     

    (ix)          By
either the Company or Executive, on the “normal retirement date” (as defined in
the Company’s Pension Plan) of Executive, by giving ninety (90) days notice
prior to the effective date of such termination;

     

    (b)           For
purposes of this Agreement, “cause” shall mean any of the
following:

     

    (i)           Executive’s
conviction in a court of law of any crime or offense which constitutes a felony,
which conviction, in the good faith judgment of the Board, makes him unfit for
continuing employment, prevents him from effective management of the Company, or
materially and adversely affects the reputation or business activities of the
Company;

     

    (ii)          Dishonesty
or willful misconduct which materially and adversely affects the reputation or
business activities of the Company and which, if capable of cure, continues
after written notice thereof to Executive (provided that prior to termination
for such reason, the Company shall give Executive written notice of the acts
constituting grounds for such termination and in the event such acts are capable
of being cured, the Company shall give Executive a period of twenty (20) days
within which to cease or correct such acts, such that there is no longer grounds
for termination for cause, and if Executive fails to cease or correct such acts
the Agreement shall be deemed terminated), or misappropriation of
funds;

     

    
      
        
        

      

      
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    (iii)         Substance
abuse, including abuse of alcohol or use of illegal narcotics, or other drugs or
substances, for which Executive fails to undertake and maintain treatment within
15 days after being requested so to do by the Company; or

     

    (iv)          Executive’s
continuing material failure or refusal to perform his duties substantially in
accordance with the terms of this Agreement, or to carry out in all material
respects the lawful directives of the Board (other than such failure resulting
from Executive’s incapacity due to injury, physical or mental illness,
disability or death); provided that prior to any termination of employment
pursuant to this clause (iv), the Company shall give Executive written notice of
the acts constituting grounds for such termination and in the event such acts
are capable of being cured, the Company shall give Executive a period of twenty
(20) days within which to cease or correct such acts, such that there is no
longer grounds for termination for cause, and if Executive fails to cease or
correct such acts the Agreement shall be deemed terminated

     

    (c)           For
purposes of this Agreement, “totally disabled” shall mean a physical or mental
incapacity or disability which renders Executive unable, with reasonable
accommodation, to perform the services required of him under this Agreement for
a period of one hundred eighty (180) days or more during any period of twelve
(12) consecutive months.  Such disability shall be subject to the
written determination of a qualified physician who shall be reasonably
acceptable to the Company and Executive (or his personal representative in the
event that Executive does not have the legal capacity at such time to make such
judgment).  In the event that Executive qualifies as being “totally
disabled” within the meaning of the Company’s Long Term Disability Plan,
Executive shall be entitled to receive long term disability payments under such
plan notwithstanding any termination of his employment hereunder, during such
period of disability, and Executive shall be entitled to the same benefits that
any other employee of the Company would enjoy under the Company’s Long Term
Disability Plan.

     

    (d)           For
purposes of this Agreement, “Good Reason” shall mean (i) a material change in
the authority, duties and responsibilities of Executive so as to be inconsistent
with those of president and chief executive officer of the Company, (ii) the
relocation of Executive’s place of employment to a place (other than the
Company’s Oxford plant) outside a radius of thirty (30) miles from the Company’s
Hunting Park Avenue plant in Philadelphia, (iii) the failure of the Company to
obtain an agreement, satisfactory to Executive, from any successor or assign of
the Company to assume and agree to perform this Agreement, (iv) the Company’s
continued failure to perform its duties hereunder in any material respect, which
failure has not been cured within twenty (20) days after written notice of such
failure (with specific reference to this Section of the Agreement) has been
given by Executive to the Company, (v) a material reduction in indemnification
provided by the Company to Executive, except in the event that such a reduction
in indemnification is applicable to all directors and officers of the Company on
a uniform basis, or (vi) Executive ceases involuntarily to be a member of the
Board of Directors (other than by reason of death, disability or termination for
cause).

     

    
      
        
        

      

      
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    (e)           For
purposes of this Agreement, a “Change of Control” of the Company shall be deemed
to occur (i) upon any Change of Control of a nature that would be required to be
reported in response to Item 6(e) of Schedule 14A or Item 5.01 of Form 8-K (or
any successor provisions thereto) promulgated under the Securities Exchange Act
of 1934, as amended and the regulations thereunder (“Exchange Act”); (ii) upon
the acquisition by any person or group of beneficial ownership (within the
meaning of Rule 13d-3 under the Exchange Act), directly or indirectly, of
twenty-five percent (25%) or more of the combined voting power of the Company’s
outstanding securities then entitled to vote generally in the election of
directors, excluding however acquisitions by the Company or any of its
subsidiaries, or any employee benefit plan sponsored or maintained by the
Company, or by a corporation pursuant to a reorganization, merger,
consolidation, division or issuance of securities of the Company if the
conditions described in clauses (v) (A) and (B) below are satisfied; (iii) if
individuals who constitute the Board as of the date of this Agreement
(“Incumbent Board”), cease for any reason to constitute at least a majority of
the Board during any twenty-four (24) month period; provided, however, that any
individual becoming a director subsequent to the date of this Agreement whose
election, or  nomination for election by the Company’s shareholders,
was approved by a vote of at least a majority of the directors then comprising
the Board shall be considered as though such individual were a member of the
Incumbent Board, but excluding for this purpose any such individual whose
initial assumption of office occurs as a result of either an actual or
threatened election contest or other actual or threatened solicitation of
proxies or consents by or on behalf of a person other than the Incumbent Board;
(iv) the consummation of a sale of all or substantially all of the assets of the
Company or the complete liquidation or dissolution of the Company; or (v) upon a
reorganization, merger, consolidation, division, or issuance of securities of
the Company, in each case unless following such transaction (A) not less than
sixty percent (60%) of the outstanding equity securities of the corporation
resulting from or surviving such transaction and of the combined voting power of
the outstanding voting securities of such corporation entitled to vote generally
in the election of directors is then beneficially owned by the holders of the
Company’s common stock immediately prior to such transaction in substantially
the same proportions as their ownership immediately prior to such transaction,
and (B) at least a majority of the members of the board of directors of the
resulting or surviving corporation were members of the Incumbent
Board.

     

    Section
6.                      Effect of
Termination.

     

    (a)           Upon
termination of this Agreement as a result of the death of Executive (as provided
in Section 5(a)(i) above), the Company shall pay Executive’s base salary through
the end of the month in which his death occurs, such payments being made to
Executive’s estate.  In addition, the Company shall pay to Executive’s
estate (i) any bonus to which Executive is entitled under Section 3(b) hereof
for the fiscal year ending on or immediately prior to the date of Executive’s
death, (ii) any bonus to which Executive is entitled under Section 3(b) hereof
for the fiscal year in which his death occurs, which bonus shall be commensurate
with bonuses paid to other Senior Executives for such year relative to bonuses
previously paid to such  Executive, prorated for the period during
such year that Executive actually worked, (iii) any unpaid accrued benefits
through the date of his death due to Executive under this Agreement, the SERP or
any employee benefit plan in which Executive was a participant, (iv)
reimbursement for any expenses to which Executive is entitled through the date
of his death under the terms of this Agreement, and (v) any indemnification
obligations to which Executive may become entitled from the Company whether by
contract or pursuant to the Company’s charter or Bylaws.

     

    
      
        
        

      

      
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    (b)           Upon
termination of this Agreement by reason of Executive’s becoming totally disabled
(as provided in Section 5(a)(ii) above), Executive shall be entitled to the
benefits, and the Company shall be obligated to provide benefits to Executive,
equivalent to those due upon termination of this Agreement as a result of death
of Executive (as provided in Section 6(a) above), plus all benefits accruing
under any long term disability insurance plan maintained by the
Company.  The bonus under clause (i) of Section 6(a) shall be
calculated for the fiscal year prior to the year in which this Agreement is
terminated under Section 5(a)(ii) above; the bonus under clause (ii) of Section
6(a) shall be calculated for the fiscal year in which such termination
occurs.  All other benefits and expenses shall be determined as of the
date such termination occurs.

     

    (c)           Upon
termination of this Agreement: by the Company for cause (as provided in Section
5(a)(iii) above); by Executive without Good Reason (as provided in Section
5(a)(vii) above); by Executive as a result of his non-renewal of this Agreement
(as provided in Section 5(a)(vi) above); or by either the Company or Executive
effective upon the normal retirement date of Executive (as provided in Section
5(a)(ix) above), then Executive shall have no further right, title or interest
to any payments required to be made in accordance with this Agreement, and the
Company shall have no further obligation to Executive hereunder, except for (i)
the unpaid portion, if any, of base salary computed on a pro rata basis through
the effective date of such termination, (ii) any bonus to which Executive is
entitled under Section 3(b) hereof for the fiscal year ending on or immediately
prior to the effective date of such termination, (iii) any unpaid accrued
benefits due to Executive through the date of such termination under this
Agreement, the SERP (except that Executive shall have no rights under the SERP
in the event his employment is terminated by the Company for cause under
Sections 5(b)(i), 5(b)(ii) or 5(b)(iii) above) or any employee benefit plan in
which Executive was a participant, (iv) reimbursement for any expenses to which
Executive is entitled through the date of such termination under the terms of
this Agreement, and (v) any indemnification obligations to which Executive may
become entitled from the Company whether by contract or pursuant to the
Company’s charter or Bylaws.

     

    (d)           Upon
termination of this Agreement: by the Company without cause (as provided in
Section 5(a)(iv) above); by the Company as a result of its non-renewal of this
Agreement (as provided in Section 5(a)(vi) above); or by Executive for “Good
Reason” (as provided in Section 5(a)(v) above), then Executive shall be entitled
to receive, in lieu of all other damages and benefits to which Executive may
otherwise be entitled as a direct or indirect result of such termination, (i) a
lump sum payment equal to Executive’s annual base salary compensation then in
effect which otherwise would have been payable for the remainder of the current
term of this Agreement, (ii) a lump sum payment equal to two (2) times the
greater of (x) Executive’s target bonus under Tasty Baking Company’s Annual
Incentive Plan for the fiscal year in which the termination occurred, or (y) the
average of the annual bonuses paid or payable to Executive during the two (2)
full fiscal years immediately prior to the termination, (iii) medical and life
insurance benefits under the Company’s group health and life plans equivalent to
those provided to Executive prior to termination (provided Executive satisfies
the insurability criteria and complies with the conditions of such plans and,
with respect to the life insurance, to the extent the Company can provide such
coverage under its plan) for a period equal to the remainder of the current term
of this Agreement, (iv) continued reimbursement for the premium cost of the $2
million life insurance coverage as described in Section 4(c) for the remainder
of the current term of this Agreement, (v) a lump sum payment equal to any
payments to which Executive would have been entitled to have contributed to the
SERP, based on Executive’s base salary and bonus for the calendar year
immediately prior to the calendar year in which the termination occurs, for a
period equal to the remainder of the current term of this Agreement, (vi) any
unpaid accrued benefits due to Executive under this Agreement, or any employee
benefit plan in which Executive was a participant, through the date of such
termination, (vii) reimbursement for any expenses to which Executive is entitled
under the terms of this Agreement through the date of such termination, and
(viii) any indemnification obligations to which Executive may become entitled
from the Company whether by contract or pursuant to the Company’s charter or
Bylaws.  The payments made pursuant to this Section 6(d) are expressly
conditioned upon Executive’s first signing a valid general release and waiver in
a form reasonably acceptable to each of Executive and the Company, pursuant to
which Executive shall release and waive all claims that he may have against the
Company, its affiliates, officers, directors, employees and agents, arising
during or related in any way to Executive’s employment with the Company, except
for the Company’s continuing obligations hereunder.  Except as
provided by Section 11, below, payments by the Company hereunder shall commence
within sixty (60) days following Executive’s termination of employment, subject
to Executive’s delivery of such executed release and provided the applicable
revocation for the release has expired.

     

    
      
        
        

      

      
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    (e)           Upon
termination of this Agreement:  by the Company (other than for cause)
within eighteen (18) months after a Change of Control; by the Company prior to a
Change of Control and Executive reasonably demonstrates that his termination was
at the request of a third party who has indicated an intention or taken steps
reasonably calculated to effect a Change of Control and who effectuates a Change
of Control (a “Third Party”) or termination otherwise occurred in connection
with, or in anticipation of, a Change of Control which actually occurs; by
Executive for Good Reason and Executive reasonably demonstrates that such action
constituting Good Reason was taken at the request of a Third Party or otherwise
occurred in connection with, or in anticipation of, a Change of Control; or by
Executive upon a Change of Control pursuant to the terms of Section 5(a)(viii)
above, then Executive shall be entitled to receive, in lieu of all other damages
and benefits to which Executive may otherwise be entitled as a direct or
indirect result of such termination, (i) a lump sum payment equal to three (3)
times his annual base salary then in effect, (ii) a lump sum payment equal to
three (3) times the greater of (x) Executive’s target bonus under Tasty Baking
Company’s Annual Incentive Plan for the fiscal year in which the Change of
Control occurred, or (y) the average of the annual bonuses paid or payable to
Executive during the two (2) full fiscal years immediately prior to the Change
of Control,  (iii) medical and life insurance benefits under the
Company’s group health and life plans for a period of thirty-six (36) months
after the date of termination equivalent to those provided to Executive prior to
his termination (provided Executive satisfies the insurability criteria and
complies with the conditions of such plans and, with respect to the life
insurance, to the extent the Company can provide such coverage under its plan),
(iv) continued reimbursement for the premium cost of the $2 million life
insurance coverage as described in Section 4(c) for a period of thirty-six (36)
months after the date of termination, (v) a lump sum payment equal to any
payments to which Executive would have been entitled to have contributed to the
SERP, based on Executive’s base salary and bonus for the calendar year
immediately prior to the calendar year in which the Change of Control occurs,
for a period of thirty-six (36) months, less any additional annual contribution
credits that are guaranteed under the SERP; (vi) any unpaid accrued benefits due
to Executive under this Agreement, or any employee benefit plan in which
Executive was a participant, through the date of such termination, (vii)
reimbursement for any expenses to which Executive is entitled under the terms of
this Agreement through the date of such termination, and (viii) any
indemnification obligations to which Executive may become entitled from the
Company whether by contract or pursuant to the Company’s charter or
Bylaws.  The payments made pursuant to this Section 6(e) are expressly
conditioned upon Executive’s first signing a valid general release and waiver in
a form reasonably acceptable to each of Executive and the Company, pursuant to
which Executive shall release and waive all claims that he may have against the
Company, its affiliates, officers, directors, employees and agents, arising
during or related in any way to Executive’s employment with the Company, except
for the Company’s continuing obligations
hereunder.    Except as provided by Section 11, below,
payments by the Company hereunder shall commence within sixty (60) days
following Executive’s termination of employment, subject to Executive’s delivery
of such executed release and provided the applicable expiration period for the
release has expired.

     

    Executive and the Company expressly
agree that in no event shall the aggregate amount of Change of Control benefits
payable to Executive hereunder plus the amount of Change of Control benefits
payable to all other Senior Executives of the Company exceed three percent (3%)
of the total transaction value for such Change of Control, as such value and
percentages are then determined by a nationally-recognized executive
compensation consulting firm or investment banking firm at the time of such
Change of Control.  The Company shall have the Accountants (as defined
below) determine promptly after a Change of Control the aggregate amount of
Change of Control benefits payable by the Company to Executive and all other
Senior Executives of the Company, and the amount, if any, by which the cap set
forth in the preceding sentence is exceeded.  Such excess shall be
allocated among Executive and all other Senior Executives of the Company
receiving change of control benefits in the same proportion as the total amount
of their individual change of control benefits relates to the aggregate amount
of change of control benefits for all such persons as a group.

     

    
      
        
        

      

      
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    In the event that the benefits provided
for in this subsection (e) or otherwise payable to Executive constitute
“parachute payments” within the meaning of Section 280G of the Code, that are
subject to the excise tax imposed by Section 4999 of the Code (the “Excise
Tax”), then Executive shall receive (i) a one-time payment from the Company
sufficient to pay such excise tax (the “Excise Tax Gross-Up”), and (ii) an
additional one-time payment from the Company sufficient to pay the additional
excise tax and federal and state income taxes arising from the Excise Tax
Gross-Up made by the Company to Executive pursuant to this subsection (e) (the
“Additional Gross-Up”); provided, however, that the Company shall only pay the
Excise Tax Gross-Up and Additional Gross-Up if the cumulative after-tax value of
such payments to Executive equals or exceeds Twenty-Five Thousand Dollars
($25,000).  In the event that the cumulative after-tax value of such
payments to Executive is less than Twenty-Five Thousand Dollars ($25,000), then
Executive’s benefits hereunder shall be either (x) delivered in full, or (y)
delivered as to such lesser extent which would result in no portion of such
benefits being subject to the Excise Tax, whichever of the foregoing amounts,
taking into account the applicable federal, state and local income and
employment taxes and the Excise Tax, results in the receipt by Executive on an
after-tax basis, of the greatest amount of benefits, notwithstanding that all or
some portion of such benefits may be taxable under the Excise Tax. In the event
that it is determined that the amount of any payments will be reduced in
accordance with this subsection (e), the payments shall be reduced on a
nondiscretionary basis in such a way as to minimize the reduction in the
economic value deliverable to Executive.  Where more than one payment
has the same value for this purpose and they are payable at different times they
will be reduced on a pro rata basis.  Unless the Company and Executive
otherwise agree in writing, the determination of Executive’s excise tax
liability and the amount required to be paid under this Section 6(e) shall be
made in writing in good faith by a nationally or regionally recognized
independent accounting firm chosen by the Company and consented to by Executive
(which consent shall not be unreasonably withheld) (the “Accountants”). In the
event that the Excise Tax incurred by Executive is determined by the Internal
Revenue Service to be greater or lesser than the amount so determined by the
Accountants, the Company and Executive agree to promptly make such additional
payment, including interest and any tax penalties, to the other party as the
Accountants reasonably determine is appropriate. For purposes of making the
calculations required by this Section 6(e), the Accountants may make reasonable
assumptions and approximations concerning applicable taxes and may rely on
interpretations concerning the application of the Code for which there is a
“substantial authority” tax reporting position. The Company and Executive shall
furnish to the Accountants such information and documents as the Accountants may
reasonably request in order to make a determination under this Section
6(e).  The Company shall bear all costs the Accountants may reasonably
incur in connection with any calculations contemplated by this Section
6(e).  Notwithstanding any provision of this subsection (e) to the
contrary, in accordance with the requirements of section 409A of the Code, any
Excise Tax Gross-Up and Additional Gross-Up payable hereunder shall be paid not
later than the end of the calendar year next following the calendar year in
which Executive or the Company (as applicable) remits the taxes for which the
Excise Tax Gross-Up and Additional Gross-Up payable are being paid.

     

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

    

     

    (f)           Executive
shall have no mitigation obligation with respect to the benefits payable to
Executive under this Section 6.  Notwithstanding any termination of
this Agreement, Executive shall remain obligated under the provisions of
Sections 9, 10 and 13(c) of this Agreement.

     

    (g)           In
the event of a Change of Control and regardless of whether Executive’s
employment is terminated in connection with such Change of Control, one hundred
percent (100%) of any outstanding incentive awards (including restricted stock
and performance shares or units, stock options or stock appreciation rights)
shall vest or become exercisable immediately and any restrictions thereon shall
lapse; provided, however, nothing in this paragraph shall prevent the Company
from exercising any rights it may have pursuant to any employee benefit plan (or
grant agreement executed thereunder) in the event Executive is terminated for
Cause.

     

    (h)           Except
as otherwise expressly provided herein, this Agreement and all of the
liabilities and obligations of the parties hereunder shall cease and terminate
effective upon the termination of the Employment Period.

     

    
      
        
        

      

      
        10

        
          

        

      

      
        
        

      

    

     

    Section
7.                      Assignment.  This
Agreement shall not be assignable by the Company except to a successor to the
Company or its business by way of merger, acquisition, purchase of all or
substantially all of its assets or otherwise and the Company shall require of
any such successor that this Agreement be binding upon and inure to the benefit
of any such parent, subsidiary or successor.  This Agreement shall not
be assignable by Executive but it shall be binding upon and inure to the benefit
of Executive’s heirs, executors, administrators and legal
representatives.

     

    Section
8.                      Notices.  All
notices, requests, demands and other communications hereunder must be in writing
and shall be deemed to have been given if delivered by hand or mailed by first
class, registered mail, return receipt requested, postage and registry fees
prepaid, and addressed as follows:

     

    (a)           If
to the Company,
to:                             Tasty
Baking Company

    2801 Hunting Park Avenue

    Philadelphia,
PA  19129

    Attention:  Secretary

    

    (b)           If
to Executive,
to:                                   Charles
P. Pizzi

    8601 Thomas Mill Drive

    Philadelphia,
PA  19128

    

    Addresses
may be changed by notice in writing signed by the addressee.

     

    Section
9.                      Confidential Information;
Non-Solicitation.

     

    (a)           Executive
agrees to hold in a fiduciary capacity for the benefit of the Company all of the
Company’s business secrets and confidential information, knowledge and data
relating to the Company or any of its affiliated companies and their respective
businesses, which shall have been obtained by Executive during his employment by
the Company or any of its affiliated companies, including without limitation,
information relating to such matters as finances, operations, processes, product
recipes, new products in development, sales methods, equipment, techniques,
plans, formulae, products, methods and know-how, customer requirements and names
of suppliers.  Executive’s obligations under this Section 9(a) shall
not be deemed violated in the event that (i) Executive discloses any such
information pursuant to order of a court of competent jurisdiction, provided
Executive has notified the Company of such potential legal order and provided
the Company with the opportunity to challenge or limit the scope of the
disclosure, or (ii) such information becomes generally available from a source
other than the Company, any of its affiliates, or any of their employees when
such source is legally entitled, to the best of Executive’s knowledge, to make
such information available, except that notwithstanding anything herein which
may be construed to the contrary, in no event shall Executive be permitted to
use or disclose any of the Company’s product recipes.

     

    
      
        
        

      

      
        11

        
          

        

      

      
        
        

      

    

     

    (b)           Executive
agrees, as a condition to the Company’s agreeing to employ him pursuant to the
terms of this Agreement and to the performance by the Company of its obligations
hereunder, including but not limited to payments to Executive after termination
of this Agreement, during the term of this Agreement and any renewals or
extensions hereof, and for a period of two (2) years thereafter, Executive shall
not, without the prior written approval of the Board, directly or indirectly
through any other person, firm or entity, whether individually or in conjunction
with any other person, or as an employee, agent, consultant, representative,
partner or holder of any interest in any other person, firm, entity or other
association:

     

    (i)           Solicit,
entice or induce any Customer (as defined below) to become a client, customer,
OEM, distributor or reseller of any other person, firm or entity with respect to
products and services the same or similar to those then sold or under
development by the Company or to cease doing business with the Company, and
Executive shall not approach any such person, firm or entity for such purpose or
authorize or knowingly approve the taking of any such actions by any other
person;

    

    (ii)          Solicit,
entice or induce, directly or indirectly, any person who presently is or at any
time during the term hereof, including any renewals or extensions hereof, was an
employee, contractor or business associate of the Company to become employed or
engaged by any other person, firm or entity or to cease their employment or
other business relationship with the Company, and Executive shall not approach
any such employee, contractor or business associate for such purpose;
or

    

    (iii)         Render
services to, consult for, become employed by, own or have a financial or other
interest in any person or entity that manufactures and/or provides products or
services competing with the products or services then sold, licensed or under
development by the Company.

    

    For purposes of this Section 9(b), a
“Customer” means (x) any person or entity which at the time of determination is,
or shall have been within two years prior to such time, a client, customer, OEM,
distributor or reseller of the Company, or (y) any person or entity to whom a
detailed written proposal has been made within twelve (12) months immediately
preceding the time of determination.

     

    (c)           Executive
agrees that in the event of breach of any of his obligations under this Section
9, the Company would suffer irreparable harm for which there is no adequate
remedy at law, and that such harm may be impossible to measure in monetary
damages.  Accordingly, in addition to any other remedies which the
Company may have at law or in equity, the Company shall have the right to have
all obligations, undertakings, agreements and other provisions of this Agreement
specifically performed by Executive, and the Company shall be entitled to an
injunction restraining Executive from violating the provisions hereof and shall
have the right to obtain preliminary and permanent injunctive relief to secure
specific performance, and to prevent a breach or contemplated breach, of this
Agreement.  In such event, the Company shall be entitled to an
accounting and repayment of all profits, compensation, remunerations or benefits
which Executive, directly or indirectly, has realized or may realize as a result
of, growing out of, or in conjunction with, any violation of this
Agreement.  Such remedies shall be in addition to and not in
limitation of any relief or other rights or remedies to which the Company is or
may be entitled at law or in equity or under this Agreement.

     

    (d)           If
any part of this Section or the application thereof is construed to be invalid
or unenforceable, then the other parts of this Section or the application
thereof shall not be affected and shall be given full force and effect without
regard to the invalid or unenforceable provisions.  If any provision
in this Section is held to be unenforceable because of the area covered, the
duration, or the scope thereof, then the court making such determination shall
have the power to reduce the area and/or duration and/or scope thereof, and the
provision shall then be enforceable in its modified form.

     

    
      
        
        

      

      
        12

        
          

        

      

      
        
        

      

    

     

    (e)           Executive
acknowledges that he will be able to earn a livelihood without violating the
provisions of Section 9 of this Agreement.  Executive further
acknowledges that his rights have been limited by this Agreement only to the
extent reasonably necessary to protect the legitimate interests of the Company
and as consideration for the Company’s entering into this
Agreement.

     

    Section
10.                                Mandatory
Mediation/Arbitration.  The procedures set forth in this
Section 10 shall constitute the sole and exclusive procedures for the resolution
of (i) any dispute under this Agreement or (ii) any other dispute between the
parties, except for any dispute related to an alleged violation of Section 9
hereof or any claims by the Company for injunctive relief.  The
parties shall first attempt to resolve any dispute through mediation conducted
in Philadelphia, Pennsylvania.  The party seeking relief shall notify
the other party in writing of the basis of the claim and the relief sought, and
the parties shall meet to agree upon a neutral mediator.  If the
parties do not promptly agree on a neutral mediator, then any of the parties may
notify J.A.M.S./Endispute, 345 Park Avenue, New York, New York, to initiate
selection of a mediator from the J.A.M.S./Endispute Panel of Neutrals. The
Company shall pay the fees and expenses of the mediator.  If the
mediator is unable to facilitate a settlement of the dispute within a reasonable
period of time, as determined by the mediator, the mediator shall issue a
written statement to the parties to that effect and the aggrieved party(ies) may
then seek relief through arbitration, which shall be binding, before a single
arbitrator pursuant to the Commercial Arbitration Rules (“Rules”) of the
American Arbitration Association (the “Association”).  The place of
arbitration shall be Philadelphia, Pennsylvania.  Arbitration may be
commenced at any time (after the mediator issues the written statement provided
in the fourth sentence of this Section 10) by any party seeking arbitration by
written notice to the other party(ies) by first class mail, postage
prepaid.  The arbitrator shall be selected by the joint agreement of
the parties, but if the parties do not so agree within (30) business days after
the date of the notice referred to above, the selection shall be made pursuant
to the Rules from the panels of arbitrators maintained by the Association, and
such arbitrator shall be neutral, impartial, independent of the parties and
others having any known interest in the outcome, shall abide by the ABA and AAA
Code of Ethics for neutral arbitrators and shall have no ex parte communications
about the dispute with either party.  The arbitrator shall render a
written decision within sixty (60) days of completion of the
arbitration.  Any award rendered by the arbitrator shall be final,
conclusive and binding upon the parties hereto and there shall be no right of
appeal therefrom.  Judgment upon the award rendered by the arbitrator
may be entered by any court having jurisdiction thereof.  The costs
and expenses of arbitration, including fees and expenses of the arbitrator,
shall be paid by the Company.  The arbitrator shall not be permitted
to award punitive or similar type damages under any
circumstances.  With respect to an alleged violation of Section 9
hereof or any claim by the Company for injunctive relief,  the
Company, without prejudice to or compliance with the procedures set forth in
this Section 10, is expressly permitted to institute legal proceedings to obtain
a temporary restraining order, a preliminary and permanent injunction or other
equitable relief.

     

    
      
        
        

      

      
        13

        
          

        

      

      
        
        

      

    

     

    Section
11.                                Section 409A
Restrictions.

     

    (a)  If and only to the
extent necessary to satisfy the requirements of Section 409A of the Code , the
payments, compensation and benefits provided to Executive by this Agreement
shall be subject to the restrictions of Section 409A of the
Code.  Notwithstanding any provision of this Agreement to the
contrary, this Agreement shall be interpreted to avoid any penalty sanctions
under Section 409A of the Code.  If any payment or benefit cannot be
provided or made at the time specified herein without incurring sanctions under
Section 409A of the Code, then such benefit or payment shall be provided in full
at the earliest time thereafter when such sanctions will not be
imposed.  For purposes of Section 409A of the Code, all payments to be
made upon a termination of employment under this Agreement may only be made upon
a “separation from service” within the meaning of such term under Section 409A
of the Code, each payment made under this Agreement shall be treated as a
separate payment and the right to a series of installment payments under this
Agreement is to be treated as a right to a series of separate
payments.  In no event shall Executive, directly or indirectly,
designate the calendar year of payment.

     

    (b)  In the event of the
termination of the Agreement by reason of Executive being totally disabled, as
provided in Section 5(c) above, Executive shall be entitled to the benefits
under Section 6(b) above at such time and in such amounts as provided by Section
6(b); provided, however, that:

     

    (i)  any bonus amounts shall
be paid to Executive in accordance with Section 6(b), but not later than two and
one-half (2-1/2) months after the end of the calendar year in which Executive
becomes totally disabled; provided, that if any stock of the Company is
publicly-traded on an established securities market or otherwise as of the date
of Executive’s termination of employment and it is necessary to comply with
section 409A of the Code, payments shall commence not earlier than six months
following Executive’s termination of employment.

     

    (ii)  reimbursement for
expenses which would be excludable from Executive’s income or which would be
deductible business expenses under Section 162 of the Code (without regard to
adjusted gross income limitations) and payment of indemnification obligations
which would be excludable from Executive’s income shall be promptly made to
Executive in accordance with Section 6(b), but not later than the end of the
second calendar year following the date of Executive’s termination due to
becoming totally disabled, or such later date as may be permitted by Section
409A of the Code.

     

    (iii)  if any stock of the
Company is publicly-traded on an established securities market or otherwise as
of the date of Executive’s termination of employment, reimbursement for any
expenses which would otherwise be includable in Executive’s income and payment
of any indemnification obligations which would be includable in Executive’s
income shall be made in accordance with Section 6(b) above, but not earlier than
the date that is six (6) months after Executive’s termination of employment due
to becoming totally disabled.

     

    (c)  In the event of the
termination of the Agreement by the Company for cause, by Executive without Good
Reason, by Executive as a result of non-renewal of the Agreement, or by the
Company or Executive upon the normal retirement date of Executive as set forth
in Section 6(c) above, Executive shall be entitled to the benefits under Section
6(c) at such time and in such amounts as provided by Section 6(c); provided,
however, that:

     

    
      
        
        

      

      
        14

        
          

        

      

      
        
        

      

    

     

    (i)  any bonus amount shall
be payable to Executive in accordance with Section 6(c), but not later than two
and one-half (2-1/2) months after the end of the calendar year in which
Executive terminates employment for any of the reasons described in Section
6(c); provided, that if any stock of the Company is publicly-traded on an
established securities market or otherwise as of the date of Executive’s
termination of employment and it is necessary to comply with section 409A of the
Code, payments shall commence not earlier than six months following Executive’s
termination of employment.

     

    (ii)  reimbursement for
expenses which would be excludable from Executive’s income or which would be
deductible business expenses under Section 162 of the Code (without regard to
adjusted gross income limitations) shall be promptly made to Executive in
accordance with Section 6(c), but not later than the end of the second calendar
year following the date of Executive’s termination of employment for any of the
reasons described in Section 6(c), or such later date as may be permitted by
Section 409A of the Code.

     

    (iii)  reimbursement for any
expenses which would otherwise be includable in Executive’s income and payment
of any indemnification obligations which would be includable in Executive’s
income shall be made in accordance with Section 6(c), but not earlier than the
date that is six (6) months after Executive’s termination of employment for any
of the reasons described in Section 6(c).

     

    (d)  In the event of the
termination of the Agreement by the Company without cause or as a result of its
non-renewal of the Agreement, or by Executive for “Good Reason” as set forth in
Section 6(d) above, Executive shall be entitled to the payments, compensation
and benefits under Section 6(d) at such time and in such amounts as provided by
Section 6(d); provided, however, that:

    

    (i)  if any stock of the
Company is publicly-traded on an established securities market or otherwise as
of the date of Executive’s termination of employment, payments of annual base
salary, bonus amounts and lump sum SERP equivalent payments, set forth in
Section 6(d), shall commence not earlier than six months following Executive’s
termination of employment.  If Executive would have otherwise received
any salary and/or bonus payments during the first six (6) months after
termination of employment but for this paragraph (d), such payments shall be
made in a single sum to Executive on the first business day following the date
that the six (6) months after his termination of employment.  In
addition, the Company shall pay Executive interest on such payments that are
delayed because of this paragraph at the Moody’s Aa rate for corporate bonds as
of the last business day preceding the beginning of the calendar year in which
such payments would have been otherwise paid to Executive pursuant to Section
6(d) above.

     

    (ii)  if any stock of the
Company is publicly-traded on an established securities market or otherwise as
of the date of Executive’s termination of employment, with respect to the
continued reimbursement for the cost of life insurance coverage described in
Section 6(d) above, Executive must pay all premiums that are due for the six (6)
month period following Executive’s termination of employment.  The
Company will reimburse Executive for all premiums that are due for such life
insurance coverage in accordance with Section 6(d) starting six (6) months after
Executive’s termination of employment and shall reimburse Executive for the
premiums that Executive has paid on the first business day following the date
that is six (6) months after Executive’s termination of employment.

     

    
      
        
        

      

      
        15

        
          

        

      

      
        
        

      

    

     

    (iii)  reimbursement for
expenses which would be excludable from Executive’s income or which would be
deductible business expenses under Section 162 of the Code (without regard to
adjusted gross income limitations) and payment of indemnification obligations
which would be excludable from Executive’s income shall be promptly made to
Executive in accordance with Section 6(d), but not later than the end of the
second calendar year following the date of Executive’s termination of
employment, or such later date as may be permitted by Section 409A of the
Code.

     

    (iv)  if any stock of the
Company is publicly-traded on an established securities market or otherwise as
of the date of Executive’s termination of employment, reimbursement for any
expenses which would otherwise be includable in Executive’s income and payment
of any indemnification obligations which would be includable in Executive’s
income shall be made in accordance with Section 6(d), but not earlier than the
date that is six (6) months after Executive’s termination of
employment.

     

    (e)  In the event of
termination of Executive’s employment other than for “cause”, as defined in
Section 5(b), above, following, prior to or in anticipation of a Change of
Control, as set forth in Section 6(e) above, Executive shall be entitled to the
payments, compensation and benefits described in Section 6(e); provided,
however, that:

     

    (i)  if any stock of the
Company (or its successor) is publicly-traded on an established securities
market or otherwise as of the date of Executive’s termination of employment,
payments of annual base salary, cash bonus amounts, lump sum SERP equivalent
payments, as set forth in Section 6(e), and, if applicable, Excise Tax Gross-Up
and Additional Tax Gross-Up, shall commence not earlier than the date that is
six (6) months following Executive’s termination of employment.  If
Executive would have otherwise received any salary, bonus payments, lump sum
SERP equivalent payments, Excise Tax Gross-Up or Additional Tax Gross-Up during
the first six (6) months after termination of employment but for this
subparagraph (i), such payments shall be made in a single sum to Executive on
the first business day following the date that is six (6) months after his
termination of employment.  In addition, the Company shall pay
Executive interest on payments that are delayed because of this subparagraph (i)
at the Moody’s Aa rate for corporate bonds as of the last business day preceding
the beginning of the calendar year in which such payments would have otherwise
been paid to Executive pursuant to Section 6(b).

     

    (ii)  if any stock of the
Company (or its successor) is publicly-traded on an established securities
market or otherwise as of the date of Executive’s termination of employment,
with respect to the continued reimbursement for the cost of life insurance
coverage described in Section 6(e) above, Executive must pay all premiums that
are due for the six (6) month period following Executive’s termination of
employment.  The Company will reimburse Executive for all premiums
that are due for such life insurance coverage in accordance with Section 6(e)
starting six (6) months after Executive’s termination of employment and shall
reimburse Executive for the premiums that Executive has paid on the first
business day following the date that is six (6) months after Executive’s
termination of employment.

     

    
      
        
        

      

      
        16

        
          

        

      

      
        
        

      

    

     

    (iii)  reimbursement for any
expenses which would be excludable in Executive’s income (or which would be
deductible business expenses under Section 162 of the Code (without regard to
adjusted gross income limitations) and payment of indemnification obligations
which would be excludable in Executive’s income shall be promptly made to
Executive in accordance with Section 6(e), but not later than the end of the
second calendar year following the date of Executive’s termination of
employment, or such later date as may be permitted by Section 409A of the
Code.

     

    (iv)  if any stock of the
Company (or its successor) is publicly-traded on an established securities
market or otherwise as of the date of Executive’s termination of employment,
reimbursement for any expenses and which would otherwise be includable in
Executive’s income and payment of any indemnification obligations which would be
includable in Executive’s income shall be made in accordance with Section 6(e),
but not earlier than the date that is six (6) months after Executive’s
termination of employment.

     

    Section
12.                                Legal
Fees.

     

    The Company shall reimburse Executive
for all reasonable legal fees and expenses incurred in good faith by Executive
as a result of any dispute with any party (including, but not limited to, the
Company and/or any affiliate of the Company) regarding the payment of any
benefit provided for in this Agreement pursuant to Section 6(e) (including, but
not limited to, all such fees and expenses incurred in connection with any tax
audit or proceeding to the extent attributable to the application of Section
4999 of the Code), plus in each case interest on any delayed payment at the
applicable Federal rate provided for in Section 7872 (f)(2)(A) of the
Code.  Such payments shall be made within five (5) business days after
delivery of Executive’s written requests for payment accompanied by such
evidence of fees and expenses incurred as the Company reasonably may
require.

    

     

    Section
13.                                Miscellaneous.

     

    (a)           This
Agreement is the entire agreement and understanding between the parties hereto
and supersedes all prior agreements and understandings, oral or written,
relating to the subject matter hereof, and no change, alteration or modification
hereof may be made except in writing signed by both parties hereto.

     

    (b)           The
headings in this Agreement are for convenience of reference only and shall not
be considered as part of this Agreement nor limit or otherwise affect the
meaning hereof.

     

    (c)           This
Agreement shall in all respects be governed by and construed and enforced in
accordance with the substantive laws of the Commonwealth of
Pennsylvania.

     

    
      
        
        

      

      
        17

        
          

        

      

      
        
        

      

    

     

    (d)           If
any section, paragraph, term or provision of this Agreement, or the application
thereof, is determined by a competent court or tribunal to be invalid or
unenforceable, then the other parts of such section, paragraph, term or
provision shall not be affected thereby and shall be given full force and effect
without regard to the invalid or unenforceable portions; and the parties
specifically authorize and agree that the court or tribunal shall modify the
section, paragraph, term or provision hereof which is so determined to be
invalid or unenforceable, and the parties specifically authorize and agree to
such modification.

     

    IN WITNESS WHEREOF, the parties hereto
have executed and delivered this Agreement as of the date first above
written.

     

    
      
        
          
            
              
                
                  
                    
                      
                        
                          
                            
                              
                                
                                  
                                    
                                      
                                        
                                          
                                            
                                              
                                                	
                                                        ATTEST:

                                                      	 	TASTY
      BAKING COMPANY
	 
      	 	 
      	 
      
	 
      	 	 
      	 
      
	/s/ Laurence
      Weilheimer 	 	By:	
                                                        /s/ James E. Ksansnak

                                                      
	
                                                        Secretary

                                                      	 	 
      	
                                                        James
      E. Ksansnak

                                                      
	 
      	 	 
      	
                                                        Chairman
      of the Board

                                                      
	
                                                        (SEAL)

                                                      	 	 
      	 
      
	 
      	 	 
      	 
      
	 
      	 	 
      	 
      
	/s/ Cynthia E.
      Freedman 	 	 
      	
                                                        /s/ Charles P. Pizzi

                                                      
	
                                                        Witness

                                                      	 	 
      	
                                                        Charles
      P. Pizzi

                                                      
	 	 	 	President
      and
	 	 	 	Chief
      Executive
Officer

                                              

                                            

                                          

                                        

                                      

                                    

                                  

                                

                              

                            

                          

                        

                      

                    

                  

                

              

            

          

        

      

    

     

     

    18a5913480ex10s.htm

    Exhibit
10 (s)

     

    TASTY
BAKING COMPANY

     

    SUPPLEMENTAL
EXECUTIVE RETIREMENT PLAN AGREEMENT

     

    AMENDED
AND RESTATED

     

    EFFECTIVE
AS OF JANUARY 1, 2009

     

    
 

    THIS
AMENDED AND RESTATED AGREEMENT, entered into as of the 23rd day of December,
2008, by and between Tasty Baking Company, a Pennsylvania corporation
(hereinafter referred to as “Employer”) and Charles P. Pizzi (hereinafter
referred to as “Employee”).

     

    W I T N E S S E T
H:

     

    WHEREAS,
the Employer and Employee entered into a Supplemental Executive Retirement Plan
Agreement (the “Agreement”) as of October 7, 2002, and further amended and
restated the Agreement as of August 19, 2004 and July 27, 2006, respectively;
and

     

    WHEREAS,
the Employer and Employee desire to amend the Agreement so that it conforms to
the requirements of Section 409A of the Internal Revenue Code of 1986, as
amended and the final regulations promulgated thereunder (the
“Code”).

     

    NOW,
THEREFORE, the parties hereto, intending to be legally bound, hereby amend and
restate the Agreement, effective as of January 1, 2009, as follows:

     

    ARTICLE
I:    CONTRIBUTIONS

     

    1.   Initial Contribution
Credit.  Effective as of September 30, 2004, the Employer shall
credit an amount equal to $172,500 to an unfunded notional account on behalf of
Employee.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    2.           Subsequent Contribution
Credits.  As of the end of each month subsequent to September
30, 2004, the Employer shall credit a contribution to such notional account on
behalf of Employee in an amount equal to 39% of the base salary and bonus paid
by the Employer to Employee during such month.  In no event shall any
contributions be credited to such notional account on behalf of Employee after
Employee attains age 67.

     

    3.           Interest
Credit.  As of the end of each month subsequent to September
30, 2004, the Employer shall credit interest to such notional account an amount
equal to the product of (a) 1/12 of the interest crediting rate for the calendar
year and (b) Employee’s account balance at the beginning of the
month.

     

    4.           Interest Crediting
Rate.  The interest-crediting rate for a calendar year will be
Moody’s Aa rate for corporate bonds as of the last business day preceding the
beginning of the calendar year.

     

    5.           Change of
Control.  In the event the Employer undergoes a “change of
control,” as defined in Employee’s Employment Agreement with the Employer, the
Employer guarantees that three additional annual contribution credits, as
determined under paragraph 2, above based upon Employee’s base salary and bonus
for the calendar year immediately prior to the calendar year in which he
terminates employment following a change of control, shall be credited to
Employee’s notional account if and only to the extent that (a) Employee does not
continue to perform service for the Employer for at least 36 months after the
change of control and (b) Employee does not receive at least 36 months of
contribution credits for such service under paragraph 2, above.  In no
event shall the guarantee of additional annual contribution credits under this
paragraph be applicable for any calendar year that Employee continues to perform
service for the Employer after the year in which Employee attains age
62.

     

    
      
        
        

      

      
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    6.           Benefits Under this
Agreement.  Benefits shall be paid to Employee pursuant to the
notional account established by the Employer for the benefit of Employee in
accordance with this Agreement and shall be in lieu of and not supplementary to
the benefits accrued by Employee under the terms of this Agreement as in effect
prior to August 19, 2004.

     

    ARTICLE
II:   PAYMENT OF
BENEFITS

    

    1.           Retirement.  Subject
to Article X, Section 3, in the event that Employee separates from service with
the Employer, his entire notional account balance, valued as of the end of the
month preceding payment, shall be paid to him in a lump sum on the first
business day of the month following the date of his separation from
service.

     

    2.           Disability.  Subject
to Article X, Section 4, In the event that Employee separates from service with
the Employer as a result of being “totally disabled,” within the meaning of and
determined under the Employer’s long-term disability program, his entire
notional account balance, valued as of the end of the month preceding payment,
shall be paid to him in a lump sum on the first business day of the month
following the date of the determination that he is totally
disabled.

     

    3.           Death.  In
the event that Employee dies prior to receiving any benefits pursuant to this
Agreement, his entire notional account balance, valued as of the end of the
month preceding payment, shall be paid in a lump sum to his surviving spouse on
the first business day of the month following the date of his
death.  In the event Employee is unmarried on the date of his death,
no payment shall be due under this Agreement.

     

    ARTICLE
III:  VESTING/FORFEITURE OF
BENEFITS

     

    Employee
shall be immediately and fully vested in all amounts credited to his notional
account pursuant to this Agreement on or after September 30,
2004.  Notwithstanding the preceding sentence, Employee’s entire
notional account balance shall be forfeited if his employment is terminated by
the Employer for “cause”, as defined in subparagraphs (i), (ii) or (iii) of
Section 5(b) of Employee’s Employment Agreement with the Employer.  No
other termination of employment of Employee under his Employment Agreement with
the Employer shall result in a forfeiture of any amounts payable to him under
this Agreement except as otherwise expressly provided herein.

     

    
      
        
        

      

      
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    ARTICLE
IV:   TERMINATION OF
EMPLOYMENT

     

    This
Agreement shall not in any way constitute an employment agreement between
Employee and Employer and shall in no way obligate Employer to continue the
employment of Employee with Employer.  This Agreement shall not limit
the right of Employer to terminate Employee’s employment with Employer in
accordance with Employee’s employment agreement with the Employer.

     

    ARTICLE
V:    ASSIGNMENT

     

    The right
of Employee to the payment of benefits under this Agreement shall not be
assigned, transferred, pledged, or encumbered.  Further, said right
shall not be subject to devise or bequest nor shall it survive the death of
Employee for any reason or circumstance, except as provided in Section 3 of
Article II, above.

     

    ARTICLE
VI:   LACK
OF FIDUCIARY RELATIONSHIP

     

    Nothing
contained in this Agreement and no action taken pursuant to the provisions of
this Agreement shall create or be construed to create a trust of any kind, or a
fiduciary relationship between the Employer and Employee or any other
person.  Any funds which may be invested for the purpose of fulfilling
the obligations which may arise under the provisions of this Agreement shall
continue for all purposes to be a part of the general funds of the Employer and
no person other than Employee shall, by virtue of the provisions of this
Agreement, have any interest in such funds.  To the extent that any
person acquires a right to receive payments from the Employer under this
Agreement, such right shall be no greater than the right of any unsecured
general creditor of the Employer.

     

    
      
        
        

      

      
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    ARTICLE
VII:  MODIFICATION

     

    This
Agreement may be revised only in writing signed by the parties
hereto.

     

    ARTICLE
VIII: GOVERNING
LAW

     

    This
Agreement shall be construed in accordance with the laws of the Commonwealth of
Pennsylvania.

     

    ARTICLE
IX:   MISCELLANEOUS

     

    1.           Status of
Payments.  Any contribution credit or benefit payable under
this Agreement shall not be included for the purpose of computing benefits to
which Employee may be entitled under any pension plan or other arrangement of
the Employer for the benefit of its employees.

     

    2.   Interpretation.  The
Compensation Committee of the Board of Directors (the “Committee”) shall have
full power and discretionary authority to interpret, construe and administer
this Agreement and the Committee’s interpretation and construction thereof and
actions thereunder, taken by majority vote, including any valuation of the
supplemental retirement compensation amount to be paid, shall be binding and
conclusive on all persons for all purposes.  No member of the
Committee or member of the Board shall be liable to any person for any action
taken or omitted in connection with the interpretation or administration of this
Agreement unless attributable to his own willful misconduct or lack of good
faith.

     

    
      
        
        

      

      
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    3.   Claims
Procedure.

     

    (a)  The
Committee shall prescribe a form for the presentation of claims under the terms
of this Agreement.

     

    (b)  Upon
presentation to the Committee of the claim on the prescribed form, the Committee
shall make the determination of the validity thereof.  If the
determination is adverse to the claimant, the Committee shall furnish to the
claimant within 90 days after receipt of the claim a written notice setting
forth the following:

     

              
(i) 
The
specific reason or reasons for the denial;

     

              
(ii) 
Specific
references to pertinent provisions of the Agreement on which the denial is
based;

     

               (iii)  A
description of any additional materials or information necessary for the
claimant to perfect the claim and an explanation of why such material or
information is necessary; and

     

              
(iv) 
Appropriate
information as to the steps to be taken if the claimant wishes to submit his or
her claim for review and the time limits applicable to such procedures,
including the right to bring a civil action under section 502(a) of
ERISA.

     

    (c)  In the
event of a denial of a claim, the claimant or his or her duly authorized
representative may appeal such denial to the Committee for a full and fair
review of the adverse determination.  The claimant’s request for a
review must be in writing and made to the Committee within 60 days after receipt
by the claimant of the written notification required under paragraph (b) above;
provided, however, such 60-day period shall be extended if the circumstances so
warrant.  The claimant or his or her duly authorized representative
may submit issues and comments in writing which will be given full consideration
by the Committee in its review.

     

    
      
        
        

      

      
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    (d)  The
Committee may, in its sole discretion, conduct a hearing.  A request
for a hearing made by the claimant will be given full
consideration.  At such hearing, the claimant shall be entitled to
appear and present evidence and to be represented by counsel.

     

    (e)  The
Committee shall make a decision on a request for review not later than 60 days
after receipt of the request; provided, however, in the event of a hearing or
other special circumstances, such decision shall be made not later than 120 days
after receipt of such request.  If it is necessary to extend the
period of time for making a decision beyond 60 days after the receipt of the
request, the claimant shall be notified in writing of the extension of time
prior to the beginning of such extension.

     

    (f)  The
Committee’s decision on review shall state in writing the specific reasons and
references to the provisions of the Agreement upon which it is based, that the
claimant is entitled to receive, upon request and free of charge, and have
reasonable access to and copies of all documents, records and other information
relevant to the claim for benefits and that the claimant may bring an action
under section 502(a) of ERISA.  Such decision shall be promptly
provided to the claimant.  If the decision on review is not furnished
in accordance with the foregoing, the claim shall be deemed denied on
review.

     

    4.   Withholding.  Any
benefit payable under this Agreement shall be subject to applicable federal,
state and local income and employment tax withholding.

     

    ARTICLE
X:    SECTION 409A RESTRICTIONS ON
DISTRIBUTIONS

     

    
      
        
        

      

      
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    1.           Amounts Deferred Prior to
January 1, 2005.  Contributions credited to Employee’s notional
account on or before December 31, 2004, including interest subsequently credited
thereon pursuant to Article I, shall be distributable to Employee pursuant to
the terms of this Agreement without regard to the provisions of this Article X
and Section 409A of the Code.  The parties agree that $218,222 was
credited to Employee’s notional account pursuant to the Agreement as of December
31, 2004.  Such amount, including interest subsequently credited
thereon pursuant to Article I, shall be hereafter referred to as the
“grandfathered account balance.”

     

    2.          
Amounts Deferred After
December 31, 2004.  Contributions credited to Employee’s
notional account after December 31, 2004, including interest subsequently
credited thereon pursuant to Article I, are subject to the requirements of
Section 409A of the Code and the regulations and other guidance issued
thereunder by the Internal Revenue Service.  Such amounts shall be
referred to hereafter as the “remainder of Employee’s notional account
balance.”  The Agreement is intended to comply with the requirements
of Section 409A of the Code, and shall be administered in accordance
therewith.  To the extent that any provision of the Agreement
conflicts with the requirements of Section 409A of the Code, such provision
shall be deemed null and void.  Notwithstanding anything in the
Agreement to the contrary, distributions may only be made under the Agreement
upon an event and in a manner permitted by section 409A of the
Code.  If a payment is not made by the designated payment date under
the Agreement, the payment shall be made by December 31 of the calendar year in
which the designated payment date occurs.  Distributions upon
termination of employment shall only be made upon Employee’s “separation from
service” within the meaning of such term under section 409A of the Code, and in
no event shall Employee, directly or indirectly, designate the calendar year of
payment.

     

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

    

     

    3.          
Retirement.  In
the event that Employee separates from service with the Employer, Employee’s
grandfathered account balance and the remainder of his notional account balance
shall be paid to him in accordance with Section 1 of Article II; provided,
however, that if any stock of the Employer is publicly-traded on an established
securities market or otherwise as of the date of Employee’s separation from
service, the remainder of Employee’s notional account balance shall be paid to
him in a lump sum on the first business day following the date that is six
months after his separation from service.  The Employer shall continue
to credit interest on the remainder of Employee’s notional account balance, in
accordance with Article I, until the date of payment to Employee.

     

    4.          
Disability.  In
the event that Employee separates from service with the Employer as a result of
being “disabled”, as defined in Article II, Employee’s grandfathered account
balance shall be paid to him in accordance with Section 2 of Article
II.  The remainder of Employee’s notional account balance shall be
paid to him in a lump sum on the first business day of the month following the
date that he has received income replacement benefits under the Employer’s
long-term disability program for three months in accordance with the applicable
requirements of section 409A of the Code.  The Employer shall continue
to credit interest, in accordance with Article I, on the remainder of Employee’s
notional account balance until the date of payment to Employee.

     

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

    

     

    IN WITNESS
WHEREOF, the parties hereto have set their hands and seals the day and
year first
above written.

     

     

    
      
        
          
            
              
                
                  
                    
                      
                        
                          
                            
                              
                                
                                  
                                    
                                      
                                        
                                          
                                            
                                              
                                                
                                                  
                                                    
                                                      
                                                        
                                                          
                                                            
                                                              
                                                                
                                                                  
                                                                    
                                                                      
                                                                        
                                                                          
                                                                            	
                                                                                    ATTEST:

                                                                                  	 	TASTY
      BAKING COMPANY
	 
      	 	 
      	 
      
	 
      	 	 
      	 
      
	/s/ Laurence
      Weilheimer 	 	By:	
                                                                                    /s/ James E. Ksansnak

                                                                                  
	
                                                                                    Secretary

                                                                                  	 	 
      	
                                                                                    James
      E. Ksansnak

                                                                                  
	 
      	 	 
      	
                                                                                    Chairman
      of the Board

                                                                                  
	 	 	 	 
	
                                                                                    
                                                                                      WITNESS:

                                                                                    

                                                                                  	 	 
      	 
      
	 
      	 	 
      	 
      
	 	 	 	 
	/s/ Cynthia E.
      Freedman  	 	 
      	/s/
      Charles P. Pizzi
	 	 	 	Charles
      P. Pizzi
	 	 	 	President
      and
	 	 	 	Chief
      Executive
Officer 

                                                                          

                                                                        

                                                                      

                                                                    

                                                                  

                                                                

                                                              

                                                            

                                                          

                                                        

                                                      

                                                    

                                                  

                                                

                                              

                                            

                                          

                                        

                                      

                                    

                                  

                                

                              

                            

                          

                        

                      

                    

                  

                

              

            

          

        

      

       

    

    
10

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