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Exhibit 10.23
[SILGAN LETTERHEAD]
April 26, 2004
Mr. Wesley Smith
Del Monte Foods
One Market Plaza
San Francisco, CA 94105
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Re:
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Seventh
Amendment to Supply Agreement *
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Amendment to the DLM Supply
Agreement
Dear Wes:
Reference is made to the September 3, 1993
Supply Agreement between Del Monte Corporation and Silgan
Containers Corporation (as amended through the date hereof, the
“Supply Agreement”). Capitalized terms used but not
defined in this letter shall have the same meaning as in the Supply
Agreement. The parties to the Supply Agreement agree to amend the
Supply Agreement as follows:
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1.
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Effective
January 1, 2005, Seller will adjust Schedule 2.1 to the Supply
Agreement to reflect an aggregate reduction in the selling prices
for Containers under the Supply Agreement of $***. From such
$ *** price adjustment, $
***
will be designated as an
advance on mutually agreed upon cost savings projects, including
those identified in Exhibit A , and applied to the
applicable Containers. The balance, or $ *** , will be spread proportionately
across the Containers for the vegetable, tomato, and fruit volumes.
DM must implement and be commercial on these cost savings projects
by January 1, 2006, or selling prices for the applicable Containers
will be increased as of such date by an amount equal to the
difference between $ *** and the aggregate cost savings
amount from the mutually agreed cost savings projects actually
implemented by January 1, 2006. Such price increase shall remain in
effect until such time that the $ *** of mutually agreed cost savings
projects are implemented and commercial (with price increases to be
reduced as the mutually agreed cost savings projects are
implemented). If mutually agreed cost savings projects are
technically infeasible or turn out to be financially unattractive,
DM and Seller may mutually agree to replace such projects with
other cost savings projects providing similar value cost savings.
Seller shall provide and pay for all Investments necessary in
connection with the mutually
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*
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Portions of the
material in this Exhibit have been redacted pursuant to a request
for confidential treatment, and the redacted material has been
filed separately with the Securities and Exchange Commission (the
“Commission”). A series of asterisks have been placed
in the precise places in this Agreement where information has been
redacted, and the asterisks are keyed to a legend which states that
the material has been omitted pursuant to a request for
confidential treatment.
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***
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This redacted
material has been omitted pursuant to a request for confidential
treatment, and the material has been filed separately with the
Commission.
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agreed $ *** of cost savings projects described
in this paragraph. Notwithstanding anything to the contrary,
Section 5.2 of the Supply Agreement shall not apply to the mutually
agreed $*** of cost savings projects described in this paragraph or
to any Investment made by Seller for such projects.
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2.
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For cost
savings projects beyond the $ *** or implemented after January 1, 2006
, Section 5.2 of the Supply Agreement is hereby amended to provide
that
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