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Collective Bargaining Agreement Dated April 1, 2002

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Sectors: Food, Beverages and Tobacco
Effective Date: April 01, 2002
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Exhibit 10.54

* * * * *

UFCW

United Food & Commercial Workers

588 NORTHERN CALIFORNIA

JACK L. LOVEALL President International Vice President

* * *

COLLECTIVE BARGAINING AGREEMENT

WITH

SWISS AMERICAN SAUSAGE CO.

APRIL 1, 2002 - APRIL 2, 2006

INDEX


SECTION


PAGE


Classification Definitions 1.2

1

Discharge 4

4

Drivers 25

19

Dues Checkoff 19.4

17

Employment 3

3

Extension and Scope 27

19

General Benefits 16

14

Grievance and Arbitration 18

16

Health and Welfare 12

11

Holidays 7

7

Hours 5

5

Job Security 21

18

Jury Duty 15

14

Leaves of Absence 9

9

No Strike or Lockout 26

19

Overtime 6

6

Pensions/Retirement Benefits 14

13

Probation Period 1.4.3

2

Recognition and Jurisdiction 1

1

Savings Clause 24

19

Seniority 17

14

Separability 22

18

Sick Leave 13

12

Superannuated Employees 11

11

Transfer of Ownership 23

18

Union Affairs 19

17

Union Security 2

3

Vacations 8

7

Wages 10

10

Working Conditions and Safety 20

17

COLLECTIVE BARGAINING AGREEMENT BETWEEN UNITED FOOD & COMMERCIAL WORKERS UNION 588-NORTHERN CALIFORNIA AND SWISS AMERICAN SAUSAGE CO.

THIS AGREEMENT , is made and entered into by and between SWISS AMERICAN SAUSAGE CO., located at 251 D' Arcy Parkway, Lathrop, California, hereinafter referred to as the " Employer" or " Company," and UNITED FOOD & COMMERCIAL WORKERS UNION, 588-NORTHERN CALIFORNIA , hereinafter referred to as the " Union."

W I T N E S S E T H :

In order to establish working conditions which are fair and equitable to the Employer and all employees, the parties hereto agree to the following:

The parties to this Agreement recognize the competitive nature of the Industry and further agree that no employee will be required to work hours in excess of the working hours established in this Agreement.

SECTION 1. RECOGNITION AND JURISDICTION


1.1 UNION RECOGNITION: The Employer hereby recognizes the Union as the exclusive bargaining agent for all employees employed in the classifications set forth in Section 10 Wages hereof working in the plant of the Employer located in San Joaquin County, California.


1.2 CLASSIFICATION DEFINITIONS: It is understood and agreed that the following groups of employees shall be recognized as:


1.2.1 SAUSAGE MAKERS: This group shall consist of Journeymen and/or Apprentices engaged in the processing and manufacturing of specialty sausage items, smoked, cooked, and cured meats and meat food products involving trimming and boning, grinding, formulating, and other preparation, chopping and mixing, hanging, tying and linking, stuffing casings, loaves and table work, cooking, smokehouse, steam cabinet, curing, and other work incidental to the above. The parties agree that all Sausage Makers or Apprentices promoted before August 1, 1998, shall be grandfathered into this classification and shall be credited towards the required number of Production Specialists.


1.2.2 PRODUCTION SPECIALIST: This group shall consist of a minimum of ten (10) Production Workers engaged primarily in processing and manufacturing of specialty sausage items, smoked, cooked, and cured meats and meat food products involving trimming and boning, grinding, formulating, and other preparation, chopping and mixing, hanging, tying and linking, stuffing casings, loaves and table work, cooking, smokehouse, steam cabinet, curing, and other work incidental to the above. Production Specialists shall have seniority as Production Specialists, but shall also have Production Worker seniority and can displace a less senior Production Worker in the event of layoff as a Production Specialist.


It is agreed and understood that the use of a Production Worker as herein described shall not result in the displacement of any current employee from his/her current classification of work. It is further agreed that, in the event of a reduction in the work force involving or


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affecting the kitchen, employees in the Production Worker classification shall be the first removed from the kitchen.


1.2.3 MAINTENANCE WORKERS: This group shall consist of employees engaged primarily in the maintenance and repair of the Employer' s equipment.


1.2.4 SANITATION WORKERS: This group shall consist of employees engaged primarily in the sanitation and cleaning of the work place.


1.2.5 ROTATION WORKERS: This group shall consist of employees engaged primarily in the rotation of the Employer' s hanging products throughout the plant. Rotation Workers shall have seniority as a Rotation Worker, but shall also have Production Worker seniority and can displace a less senior Production Worker in the event of layoff as a Rotation Worker.


1.2.6 WORKING FOREPERSON: A Working Foreperson shall not be disciplined by the Union or discriminated against in any way for exercising discretionary duties on behalf of Management or effectively recommending courses of action to Management.


1.2.7 SUPERVISORS: Supervisors will not be a part of the bargaining unit, will not be required to join the Union, but will be permitted to perform whatever work the Company assigns; provided, however, that the number of Supervisors shall be limited to a number equal to ten percent (10%) of the number of bargaining unit employees.


1.2.8 OWNER' S FAMILY MEMBERS: It is agreed and understood that officers and their immediate family may, if assigned to perform bargaining unit work, become members of the Union on the same terms and conditions membership is made available to all other bargaining unit employees provided that the officer is stationed in the jurisdiction of this Agreement and these family members do not cause the displacement of any current employee.


1.3 PERFORMANCE OF BARGAINING UNIT WORK: The Employer agrees that only employees included in the bargaining unit shall perform any of the work coming within the jurisdiction of this Agreement, provided, however, that nonbargaining unit employees may perform bargaining unit work, where necessary, for emergencies beyond the control of the Employer, work in the instruction or training of employees and testing materials in production.


1.4 EMPLOYEE STATUS:


1.4.1 REGULAR EMPLOYEE: A regular employee is one who has completed the probationary period for all new employees in accordance with Section 17 Seniority hereof.


1.4.2 EXTRA EMPLOYEE: An extra employee is any employee hired either to relieve a regular employee or to supplement the existing force. Extra employees shall not be employed to displace regular employees. An extra employee who works forty-five (45) workdays for the same Employer within a twelve (12) month period shall become a regular employee for the purposes of benefit eligibility. Extra employees may be scheduled less than forty (40) hours per week. Regular employees on layoff shall be hired first. No extra employees will be hired when regular employees in the same classification are on layoff. It is agreed and understood that assignment of employees to work less than forty (40) hours per week within the meaning of this provision, shall not operate to replace any existing employees and, further, the hiring of employees to work less than forty (40) hours per week shall not be done for the purpose of permanently replacing full-time positions. In the event of a reduction in force, those employees regularly scheduled to work less than forty (40) hours per week shall be laid off prior to the layoff of any regular employees.


1.4.3 PROBATIONARY EMPLOYEES: A probationary employee is one who has not yet completed the required forty-five (45) workdays of trial employment with the current


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Employer, as specified in Section 17 Seniority herein. New employees to the Industry hired on or after April 1, 1988, shall not be entitled to health and welfare contributions, holidays, funeral leave, sick pay, and jury duty pay during the probationary period.


1.5 MANAGEMENT RIGHTS: The Employer shall have the right to the general management of all operations and the direction of the work force, including, but not limited to, the right to hire, transfer, promote, maintain discipline and efficiency, layoff, establish new processes or use new equipment, establish schedules of production, and to extend, limit, or curtail its operations. Nothing in this Agreement shall be construed, by any manner or means, to preclude the subcontracting of work by the Company or to require the Company to perform work at this plant, rather than elsewhere, so long as the rights specified herein are not exercised in a manner inconsistent with this Agreement.


SECTION 2. UNION SECURITY

2.1 UNION MEMBERSHIP: Every person performing work covered by this Agreement who is a member of the Union on the effective date of this Section shall, as a condition of employment or continued employment, remain a member of the Union. Every person employed to perform work covered by this Agreement shall, as a condition of employment, be a member of the Union or shall, within a period of thirty-one (31) days after the effective or execution date of this Agreement, whichever is later, become a member of the Union.

2.2 MAINTENANCE OF MEMBERSHIP: The Employer shall discharge every person who has failed to comply with the provisions of Subsection 2.1 above at the end of the workday during which notice of such noncompliance is received. The Employer further agrees not to again employ or reemploy any person(s) so discharged until he/she is a member of the Union; provided, however, in the event that the Labor Management Relations Act, as amended, is applicable to this Agreement, the provisions of this sentence of this Subsection 2.2 shall not be applied until a final administrative or judicial decision has been rendered which would permit its application under the Act.

2.3 APPLICANTS FOR MEMBERSHIP: Membership in the Union shall be available to persons employed in work covered by this Agreement upon terms and qualifications not more burdensome than those applicable generally to other applicants for such membership.

SECTION 3. EMPLOYMENT

3.1 NO DISCRIMINATION: The Employer shall have sole responsibility for and full freedom in the selection, employment, and discharge of persons employed or to be employed in work covered by this Agreement, subject to the provisions of this Agreement, provided that there shall be no discrimination because of membership or nonmembership in or participation or nonparticipation in the activities of the Union. The Employer will not discharge or discriminate against any employee for upholding lawful Union principles such as serving as an officer or other representative of the Union, soliciting membership in the Union, wearing Union buttons, distributing Union literature, or attending Union meetings provided that such activity does not interfere with his/her work. The Employer will not discharge or discriminate against any employee for failing or refusing to purchase stock, bonds, securities, or any other interest in any corporation, partnership, or company.

3.2 HIRING NOTIFICATION: An Employer who desires to employ a person in work covered under this Agreement shall inform the Union of the number and qualifications of persons desired and the location of the job site in advance of the time that such persons are required.

3.3 HIRING CONSIDERATION: In the hiring of new employees, the Employer agrees that it will give equal consideration to all applicants, including those referred by the Union. The Employer and the Union will not discriminate against any employee with regard to compensation or terms and conditions of employment because of such individual' s race, color, religion, sex, age (to the extent


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provided by law), or national origin; nor will they limit, segregate, or classify employees in any way to deprive any individual employee of employment opportunities because of their race, color, religion, sex, age (to the extent provided by law), or national origin. Any reference to the male gender in this Agreement shall be in the generic sense and it shall refer equally to either sex without discrimination, as provided above.

3.4 UNION NOTIFICATION: The Employer shall notify the Union within one (1) week of the name, address, social security account number, and classification of every such person employed in work covered by this Agreement, together with the date of such employment and the location of the place or prospective place of employment. Whenever a person is rejected for or discharged from such work, the Employer shall, upon request of the Union, notify the Union of the reason or reasons therefor. The notification required by this Subsection shall be made, in writing, within forty-eight (48) hours after such request. Any employee hired shall report to the Union within one (1) week after the date of employment to fill out and sign applications, forms, and papers for health and welfare, dental, and pension purposes.

SECTION 4. DISCHARGE

4.1 PROHIBITION AGAINST DISCHARGE: No employee covered by this Agreement shall be suspended, demoted, or discharged without just and sufficient cause. Discharge for failure to comply with Section 2 Union Security, Subsection 2.1 of this Agreement shall be deemed a discharge for cause. Before an employee is suspended for more than three (3) days or discharged, he/she shall receive written warning of unsatisfactory conduct and a copy of such notice shall be sent to the Union. Such written warning shall not be effective for suspension actions for more than nine (9) months. The employee receiving such warning shall be given reasonable opportunity to rectify or change such conduct. The notice and warning required by this Subsection need not be given to employees disciplined for, but not limited to, any gross violation of reasonably acceptable conduct.

4.2 NOTICE FROM INSURANCE CARRIER: When an insurance carrier notifies the Employer that the firm' s vehicle insurance is being canceled because of a driver' s record of on-the-job driving on file with the California Department of Motor Vehicles, that driver may be transferred to another job, if available, where he/she shall have seniority as a new employee or, if no job is available, he/she may be laid off pending the results of the grievance procedure.

4.3 RIGHT OF APPEAL: Any employee claiming unjust dismissal, demotion, or suspension shall make his/her claim therefor to the Union within ten (10) working days of such dismissal, demotion, or suspension, and the Union will, that day, notify the Employer by telephone and confirm in writing, otherwise no action shall be taken by the Union. If, after proper investigation by the Union and the Employer, it has been found that an employee has been disciplined unjustly, he/she shall be reinstated with full rights and shall be paid his/her wages for the period he/she was suspended, demoted, or dismissed. Investigation of any claims shall be made within ten (10) days of the making of such complaint by the employee. Any dispute arising out of such suspension, demotion, or discharge shall be processed under Section 18 Grievance and Arbitration of this Agreement.

4.4 NOTIFICATION OF DISCHARGE: When an employee is discharged, the Employer must give written notice to the employee, stating the reasons for such discharge, and the Union shall receive a copy of said notice. Upon written notification by the Union of an employee holding a second job, the Employer will either terminate the employment of the employee or require that he/she resign his/her second job. Where an employee is holding a full-time second job, the Employer, five (5) working days after written notice to the employee requesting he/she resign his/her second job, may terminate him/her if he/she does not do so.


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SECTION 5. HOURS

5.1 HOURS OF OPERATION: The hours of operation of the Employer' s facility shall be as hereunder provided and shall apply to all employees of the Employer covered herein. Hours worked in excess of eight (8) straight-time hours in a day or in excess of forty (40) straight-time hours in any week shall be paid at one and one-half (1-1/2) times the straight-time rate.

5.2 POSTING REQUIREMENT: All regular employees shall have their schedule posted by Friday noon for the following workweek. It shall not be changed except by reason of an act of God or other reason beyond the reasonable control of the Employer. The schedule shall show the full name of the employee, the starting times, and the days scheduled for him/her during the following week, in ink or typewritten.

5.3 SCHEDULE OF SHIFT: All first-shift hours shall be regularly scheduled to commence no earlier than 4:30 a.m., and no later than 10:00 a.m. The second-shift hours shall commence on or after 10:00 a.m., and no later than 5:00 p.m. The third-shift hours shall commence on or after 5:00 p.m., and before 5:00 a.m. All work commenced on or after 10:00 a.m., but no later than 5:00 p.m., shall be paid for at the rate of the second-shift premium for all hours worked. All work commenced on or after 5:00 p.m., and before 5:00 a.m., shall be paid at the third-shift premium for all hours worked.

5.4 GUARANTEED WORKWEEK: Regular employees shall be guaranteed payment for and expected to work eight (8) hours each day, forty (40) hours for each week, subject to the addition of all premium and overtime provisions, unless such work ceases to be available by reason of an act of God or other reason beyond the control of the Employer. Employees unable to work eight (8) hours a day, forty (40) hours a week shall provide a reasonable explanation and verification of the reason of absence where appropriate and in compliance with the provisions of this Agreement.

5.5 EXTRA EMPLOYEES WORKWEEK: Extra employees may be scheduled to work less than forty (40) hours per week. Extra employees shall be scheduled to work in accordance with their seniority. Extra employees scheduled to work less than forty (40) hours shall be scheduled as work is available.

5.6 REGULAR WORKWEEK: The regular workday shall consist of eight (8) hours within nine (9) hours, Monday through Friday, inclusive; provided, however, it is agreed and understood that the Employer may, during the course of this Agreement, with seven (7) calendar days' notice to the Union, institute a Tuesday through Saturday workweek. This workweek shall be comprised of a regular crew and established only for the purpose of expanding production capability. This workweek shall be offered on a voluntary basis to existing employees and shall not be used to reduce existing Saturday overtime opportunities.

5.7 MINIMUMS: Five (5) days consisting of eight (8) working hours per day, forty (40) hours Monday through Friday, inclusive, except as otherwise herein provided, shall constitute a workweek for all eligible employees except that during a week in which a holiday falls, the workweek shall consist of thirty-two (32) hours. Employees called to work will be provided with a minimum of eight (8) hours' work or pay in lieu of work, such pay to start from the hour the employee is required to report for work, except in case of matters beyond the control of the Employer. Employees doing security inspection or quality control shall be guaranteed a minimum of one (1) hour of work or pay in lieu thereof.

5.8 BID ON JOB SHIFTS: Employees shall have the right to bid on job shift assignments in the order of their seniority except that no employee shall have this opportunity more often than once in every six (6) month period, except when a shift is reestablished within the six (6) months. It is understood that this privilege shall not result in chain bumping. When a shift is discontinued, the senior employee shall have the right to bid on the job classification in the existing shift.


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5.9 CALL BACK: An employee called back to work within twelve (12) hours from the end of his/her shift shall be paid at one and one-half (1-1/2) times his/her applicable rate for the hours worked prior to the expiration of such hours.

5.10 MEAL PERIODS: All employees shall receive one (1) full uninterrupted hour for a meal period or, by mutual agreement between the employees, the Employer, and the Union, one-half (1/2) hour approximately in the middle of the workday, and in no event shall an employee work more than five (5) hours before any meal period. In agreeing on lunch periods, the parties will consider the requirement set by the USDA for Meat Inspectors.

5.11 REST PERIODS: All employees shall receive two (2), fifteen (15) minute rest periods in an eight (8) hour day. Employees working beyond nine (9) hours in a day shall receive an additional ten (10) minute rest period.


5.11.1 All employees shall receive two (2) fifteen (15) minute rest periods in an eight (8) hour day. These breaks may not be waived.


5.11.2 Employees working beyond nine and three-fourths (9be) hours in a day are entitled to an additional ten (10) minute rest period. At the Employer' s option, employees may be sent home ten (10) minutes early (with pay) in lieu of getting this overtime break.


5.12 CLEAN UP: Sufficient time shall be allowed to clean up the plant in order that the employees may leave by their regular quitting time.

SECTION 6. OVERTIME

6.1 OVERTIME PAY: All work in excess of eight (8) hours in one (1) day and all work in excess of forty (40) hours in one (1) week shall be paid for at the overtime rate, which shall be one and one-half (1-1/2) times the employee' s regular straight-time hourly rate of pay.

Employees shall be paid at one and one-half (1-1/2) times the employee' s regular straight-time rate of pay for all work performed on the sixth (6th) day of the employee' s workweek. All work performed in excess of ten (10) hours in any one (1) day shall be paid for at the overtime rate of two (2) times the employee' s regular straight-time rate of pay. When overtime work is scheduled for Sundays and holidays, such work shall be paid for at the overtime rate of two (2) times the employee' s regular straight-time rate of pay. All work performed either before the employee' s scheduled eight (8) hour shift or after the completion of his/her scheduled eight (8) hour shift, except as provided above, shall be paid for at the rate of one and one-half (1-1/2) times the employee' s regular straight-time rate of pay. In the event an employee is required to report for work earlier than his/her scheduled shift starting time, the Employer shall schedule a minimum of thirty (30) minutes of work time in this period. There shall be no pyramiding of overtime under this Agreement. Extra employees will be given the preference whenever possible to avert overtime.

6.2 DAILY OVERTIME: The Employer shall post a Volunteer Overtime Sign-up Sheet by all time clocks on Monday of each week. The sheets will remain posted until Friday of each week. Employees must indicate their preference for daily and/or Saturday/Sunday overtime, or sixth/seventh day work, or work on contractual holidays. Employees who wish to volunteer for one or both must sign the sheet by Friday for the next workweek. If the Employer determines that overtime is needed on a given line or work area, within the job classification, the most senior qualified employee working on that line or work area will be offered such overtime work. In the event there is an insufficient number of qualified senior employees willing to work the required overtime, such work shall be assigned in order of inverse seniority.

6.3 REPORTING PAY: When an employee is sent out from the Union to a position at the request of the Employer, or is requested by the Employer to report to work, and arriving there on time is not permitted to work, the employee reporting to work shall be given a day' s pay. If an employee arrives late, then he/she may be sent home and the Employer shall not be obligated to


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pay him/her for that day; however, if the employee is allowed to work any part of that day, he/she shall be paid only for the hours actually worked on that day and his/her guarantee
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