10-Q

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No. 1 of 20 Pages

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

FOR QUARTERLY AND TRANSITION REPORTS PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

þ QUARTERLY REPORT PURSUANT TO SECTIONS 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934

For the quarterly period ended July 31, 2002

or

o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from      to      

Commission file number 1-5111

THE J. M. SMUCKER COMPANY

(Exact name of registrant as specified in its charter)

Ohio (State or other jurisdiction of incorporation or organization)	34-0538550 (I.R.S. Employer Identification No.)
One Strawberry Lane Orrville, Ohio (Address of principal executive offices)	44667-0280 (Zip code)

Registrant’s telephone number, including area code (330) 682-3000

Securities registered pursuant to Section 12(b) of the Act:

Title of each class
Common shares, no par value Name of each exchange on which registered
New York Stock Exchange

Securities registered pursuant to Section 12(g) of the Act: None

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for at least the past 90 days. þ Yes o No

The Company had 49,574,260 common shares outstanding on August 31, 2002.

The Exhibit Index is located at Sequential Page No. 20.

TABLE OF CONTENTS

PART I. FINANCIAL INFORMATION
	Item 1. Financial Statements
		CONDENSED STATEMENTS OF CONSOLIDATED INCOME
		CONDENSED CONSOLIDATED BALANCE SHEETS
		CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
		NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
	Item 2. Management’s Discussion and Analysis
PART II. OTHER INFORMATION
	Item 6. Exhibits and Reports on Form 8-K
SIGNATURES
CERTIFICATIONS
INDEX OF EXHIBITS
EX-10 Consulting and Incomplete Agreements

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No. 2

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

THE J. M. SMUCKER COMPANY
CONDENSED STATEMENTS OF CONSOLIDATED INCOME
(Unaudited)

		Three Months Ended
		July 31,
		2002			2001
		(Dollars in thousands, except per
		share data)
Net sales		$	274,936		$	169,792
Cost of products sold			182,584			112,612
Gross Profit			92,352			57,180
Selling, distribution, and administrative expenses			59,947			41,685
Merger and integration costs			4,887			—
Operating Income			27,518			15,495
Other income (expense)
	Interest income		569			731
	Interest expense		(2,313	)		(2,281	)
	Other – net		60			67
Income Before Income Taxes			25,834			14,012
Income taxes			9,817			5,465
Net Income		$	16,017		$	8,547
Net Income per common share		$	0.39		$	0.37
Net Income per common share – assuming dilution		$	0.39		$	0.37
Dividends declared per common share		$	0.20		$	0.17

See notes to condensed consolidated financial statements.

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THE J. M. SMUCKER COMPANY
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)

				July 31, 2002			April 30, 2002
				(Dollars in thousands)
ASSETS
CURRENT ASSETS
	Cash and cash equivalents			$	74,095		$	91,914
	Trade receivables, less allowances				111,443			57,371
	Inventories:
			Finished products		91,490			52,817
			Raw materials, containers, and supplies		104,221			63,722
					195,711			116,539
	Other current assets				16,762			13,989
			Total Current Assets		398,011			279,813
PROPERTY, PLANT, AND EQUIPMENT
	Land and land improvements				23,358			16,911
	Buildings and fixtures				105,499			87,126
	Machinery and equipment				336,398			242,590
	Construction in progress				12,955			7,504
					478,210			354,131
	Less allowances for depreciation				(197,622	)		(191,342	)
			Total Property, Plant, and Equipment		280,588			162,789
OTHER NONCURRENT ASSETS
	Goodwill				495,691			33,510
	Other intangible assets				331,672			14,825
	Other assets				31,298			33,955
			Total Other Noncurrent Assets		858,661			82,290
				$	1,537,260		$	524,892
LIABILITIES AND SHAREHOLDERS’ EQUITY
CURRENT LIABILITIES
	Accounts payable			$	71,763		$	32,390
	Other current liabilities				94,259			48,041
			Total Current Liabilities		166,022			80,431
NONCURRENT LIABILITIES
	Long-term debt				135,000			135,000
	Other noncurrent liabilities				166,966			29,317
			Total Noncurrent Liabilities		301,966			164,317
SHAREHOLDERS’ EQUITY
	Common shares				12,390			6,217
	Additional capital				809,479			33,184
	Retained income				273,939			267,793
	Less:
		Deferred compensation			(3,292	)		(2,725	)
		Amount due from ESOP			(8,562	)		(8,562	)
		Accumulated other comprehensive loss			(14,682	)		(15,763	)
			Total Shareholders’ Equity		1,069,272			280,144
				$	1,537,260		$	524,892

See notes to condensed consolidated financial statements.

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THE J. M. SMUCKER COMPANY
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)

			Three Months Ended
			July 31,
			2002			2001
			(Dollars in thousands)
OPERATING ACTIVITIES
	Net income		$	16,017		$	8,547
	Adjustments to reconcile net income to net cash provided       by operating activities:
		Depreciation		7,475			6,024
		Amortization		688			1,146
		Other adjustments		(21,452	)		(5,923	)
Net cash provided by operating activities				2,728			9,794
INVESTING ACTIVITIES
	Business acquired, net of cash acquired			(9,303	)		—
	Additions to property, plant, and equipment			(8,371	)		(6,315	)
	Disposal of property, plant, and equipment			66			15
	Other – net			422			391
Net cash used for investing activities				(17,186	)		(5,909	)
FINANCING ACTIVITIES
	Dividends paid			(3,939	)		(3,865	)
	Other – net			211			(211	)
Net cash used for financing activities				(3,728	)		(4,076	)
Effect of exchange rate changes				367			58
Net decrease in cash and cash equivalents				(17,819	)		(133	)
Cash and cash equivalents at beginning of period				91,914			51,125
Cash and cash equivalents at end of period			$	74,095		$	50,992

(    ) Denotes use of cash

See notes to condensed consolidated financial statements.

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THE J. M. SMUCKER COMPANY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Note A – Basis of Presentation

         The accompanying unaudited, condensed, consolidated financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments considered necessary for a fair presentation have been included. Operating results for the three-month period ended July 31, 2002, are not necessarily indicative of the results that may be expected for the year ending April 30, 2003. For further information, reference is made to the consolidated financial statements and footnotes included in the Company’s Annual Report on Form 10-K for the year ended April 30, 2002.

Note B – Merger

         On June 1, 2002, the Company merged the Jif peanut butter and Crisco shortening and oils businesses of The Procter & Gamble Company (P&G) with and into the Company in a tax-free stock transaction. Under the terms of the agreement, P&G spun off its Jif and Crisco businesses to its shareholders and immediately thereafter those businesses were merged with and into the Company. P&G shareholders received one Company common share for every 50 P&G common shares that they held as of the record date for the distribution of the Jif and Crisco businesses to the P&G shareholders. The Company’s shareholders received 0.9451 of a new Company common share for each Company common share that they held immediately prior to the merger. Approximately 26,000,000 common shares were issued to the P&G shareholders, valued at approximately $781,485,000 based on the average market price of the Company’s common shares over the period from three days before to three days after the terms of the merger were announced. Upon completion of the merger, the Company had 49,531,376 common shares outstanding.

         The conversion of the Company’s common shares into new Company common shares has been treated in a manner similar to a reverse stock split. All per share data for all periods presented have been restated to reflect the effects of the conversion.

         The merger and the combination of three brands – Smucker’s, Jif, and Crisco – enhances the Company’s strategic and market position. The merger was accounted for as a purchase business combination. For accounting purposes, the Company is the acquiring enterprise. Accordingly, the results of the Jif and Crisco operations are included in the Company’s consolidated financial statements from the date of the merger.

         The aggregate purchase price was approximately $790,788,000 including $9,303,000 of acquisition related expenses. The purchase price has been allocated to the underlying assets acquired and liabilities assumed based upon their preliminary estimated fair values at the date of acquisition. Final estimated fair values will be determined by independent appraisals, discounted cash flows, quoted market prices, and management estimates. The Company currently expects to finalize the purchase price allocation by May 31, 2003.

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         The following table summarizes the preliminary estimated fair values of the assets acquired and liabilities assumed at the date of the merger. The allocation of the purchase price is preliminary and subject to adjustment following completion of the valuation process.

(Dollars in thousands)		June 1, 2002
Assets:
	Tangible assets	$	157,706
	Intangible assets not subject to amortization		280,000
	Intangible assets subject to amortization (15 year weighted-average useful life)		37,333
	Goodwill		462,374
Total assets acquired			937,413
Total liabilities assumed			(146,625	)
Net assets acquired		$	790,788

         The $462,374,000 of goodwill relates to the U.S. retail market segment and will not be deductible for tax purposes.

         Had the merger of the Jif and Crisco businesses with and into the Company occurred at the beginning of fiscal 2002, pro forma consolidated results would have been as follows:

	Three Months Ended July 31,
(Dollars in thousands)	2002		2001
Net sales	$	318,000	$	304,800
Operating income, excluding indirect expenses of the Jif and Crisco businesses	$	44,900	$	50,600

Note C – Change in Accounting Principle

         Effective May 1, 2002, the Company adopted Statement of Financial Accounting Standard No. 142, Goodwill and Other Intangible Assets (SFAS 142). In accordance with SFAS 142, goodwill and indefinite lived intangible assets are no longer amortized but are reviewed at least annually for impairment.

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         Prior to the adoption of SFAS 142, amortization expense was recorded for goodwill and other intangible assets. The following table sets forth a reconciliation of net income and earnings per share information adjusted for the nonamortization provisions of SFAS 142.

		Three Months Ended July 31,
(Dollars in thousands)		2002		2001
Net income, as reported		$	16,017	$	8,547
Goodwill and indefinite lived intangible asset amortization			—		550
Net income, as adjusted		$	16,017	$	9,097
Earnings per common share:
	Net income, as reported	$	0.39	$	0.37
	Goodwill and indefinite lived intangible asset amortization		—		0.03
	Net income, as adjusted	$	0.39	$	0.40
	Net income, as reported – assuming dilution	$	0.39	$	0.37
	Goodwill and indefinite lived intangible asset amortization – assuming dilution		—		0.02
	Net income, as adjusted – assuming dilution	$	0.39	$	0.39

         The Company has not completed its initial asset impairment assessment as required in adopting SFAS 142.

Note D – Common Shares

         At July 31, 2002, 150,000,000 common shares were authorized. There were 49,558,746 and 23,504,129 (restated) shares outstanding at July 31, 2002, and April 30, 2002, respectively. Shares outstanding are shown net of 7,109,187 and 7,140,338 (restated) treasury shares at July 31, 2002, and April 30, 2002, respectively.

Note E – Operating Segments

         Effective June 1, 2002, the Company realigned its business segment structure in recognition of the changes resulting from the addition of the Jif and Crisco businesses. Prior year segment information has been restated to conform to the new structure.

         The Company operates in one industry: the manufacturing and marketing of food products. The Company has two reportable segments: U.S. retail market and special markets. The U.S. retail market segment includes the consumer and the consumer oils business areas. This segment represents the primary strategic focus area for the Company – the sale of branded food products with leadership positions to consumers through mainstream domestic retail outlets. The special markets segment represents the aggregation of the foodservice, international, industrial, and beverage business areas. Special markets segment products are distributed through/to foreign countries, foodservice distributors and operators (i.e., restaurants, schools and universities, health care operations), other food manufacturers, and health and natural food stores.

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         The following table sets forth operating segments information:

		Three Months Ended July 31,
(Dollars in thousands)		2002			2001
Net sales:
	U.S. retail market	$	168,256		$	85,777
	Special markets		106,680			84,015
Total net sales		$	274,936		$	169,792
Segment profit:
	U.S. retail market	$	34,453		$	17,895
	Special markets		13,767			9,336
Total segment profit			48,220			27,231
	Interest income		569			731
	Interest expense		(2,313	)		(2,281	)
	Amortization expense		(688	)		(1,146	)
	Merger and integration costs		(4,887	)		—
	Corporate administrative expenses		(15,150	)		(10,651	)
	Other unallocated income		83			128
Income before income taxes		$	25,834		$	14,012

Note F – Earnings Per Share

         The following table sets forth the computation of earnings per common share and earnings per common share – assuming dilution:

		Three Months Ended
		July 31,
(Dollars in thousands, except per share data)		2002		2001
Numerator:
Net income		$	16,017	$	8,547
Denominator:
Denominator for earnings per common share – weighted-average shares			40,645,895		22,936,480
Effect of dilutive securities:
	Stock options		300,740		209,091
	Restricted stock		70,124		32,475
Denominator for earnings per common share – assuming dilution			41,016,759		23,178,046
Net income per common share		$	0.39	$	0.37
Net income per common share – assuming dilution		$	0.39	$	0.37

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Note G – Derivative Financial Instruments

         The Company is exposed to market risks, such as changes in interest rates, currency exchange rates, and commodity pricing. To manage the volatility relating to these exposures, the Company enters into various derivative transactions pursuant to the Company’s policies in areas such as counterparty exposure and hedging practices. Hedge effectiveness designation is performed on a specific exposure basis to support hedge accounting. The changes in fair value of these hedging instruments are offset in part or in whole by corresponding changes in fair value or cash flows of the underlying exposures being hedged.

         Interest rate hedging. The Company’s policy is to manage interest cost using a mix of fixed- and variable-rate debt. To manage this mix in a cost efficient manner, the Company enters into interest rate swaps in which the Company agrees to exchange, at specified intervals, the difference between fixed and variable interest amounts calculated by reference to an agreed-upon notional principal amount.

         Commodity price management. Raw materials used by the Company’s Crisco business are subject to price volatility caused by supply conditions, political and economic variables, and other unpredictable factors. In connection with the acquisition of Crisco, to manage the volatility related to anticipated inventory purchases to be made by Crisco, the Company uses futures and options with maturities generally less than one year. These instruments are designated as cash flow hedges. The mark-to-market gain or loss on qualifying hedges is included in other comprehensive income to the extent effective, and reclassified into cost of products sold in the period during which the hedged transaction affects earnings. The mark-to-market gains or losses on nonqualifying, excluded, and ineffective portions of hedges are recognized in cost of products sold immediately.

Note H – Financing Arrangements

         The Company has uncommitted lines of credit providing up to $90,000,000 for short-term borrowings. No amounts were outstanding at July 31, 2002.

Note I – Comprehensive Income

         During the quarter ended July 31, 2002 and 2001, total comprehensive income was $17,098,000 and $6,954,000, respectively. Comprehensive income consists of net income, foreign currency translation adjustments, minimum pension liability adjustments, and unrealized gains and losses on commodity hedging activity.

Note J – Goodwill and Other Intangibles

         A summary of changes in the Company’s goodwill during the three months ended July 31, 2002, by reportable operating segment is as follows:

	Balance at							Balance at
(Dollars in thousands)	April 30, 2002		Acquisitions		Other			July 31, 2002
U.S. retail market	$	13,353	$	462,374	$	—		$	475,727
Special markets		20,157		—		(193	)		19,964
Total	$	33,510	$	462,374	$	(193	)	$	495,691

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         The Company’s intangible assets and related accumulated amortization is as follows:

(Dollars in thousands)	As of July 31, 2002						As of April 30, 2002
			Accumulated						Accumulated
	Acquisition cost		amortization		Net		Acquisition cost		amortization		Net
Patents	$	37,333	$	414	$	36,919	$	—	$	—	$	—
Customer lists and formulas		3,887		292		3,595		3,887		194		3,693
Total intangible assets subject to amortization		41,220		706		40,514		3,887		194		3,693
Trademarks with indefinite lives		291,158		—		291,158		11,132		—		11,132
Total intangible assets not subject to amortization		291,158		—		291,158		11,132		—		11,132
Total intangible assets	$	332,378	$	706	$	331,672	$	15,019	$	194	$	14,825

         The amounts above include preliminary estimates related to the goodwill and intangible assets acquired in the Jif and Crisco merger.

         Amortization expense for intangible assets was approximately $512,000 for the three months ended July 31, 2002. Based on the current amount of intangible assets subject to amortization, the estimated amortization expense for each of the succeeding 5 years is $2,670,000 for fiscal 2003 and $2,878,000 for fiscal 2004 through 2007.

Note K – Recently Issued Accounting Standards

         In August 2001, the Financial Accounting Standards Board issued Statement of Financial Accounting Standards No. 144, Accounting for the Impairment or Disposal of Long-Lived Assets (SFAS 144). SFAS 144 addresses financial accounting and reporting for the impairment or disposal of long-lived assets to be held and used, to be disposed of other than by sale and to be disposed of by sale. The Company adopted SFAS 144 as of May 1, 2002. The adoption of SFAS 144 did not have an impact on the Company’s consolidated financial statements.

         In July 2002, the Financial Accounting Standards Board issued Statement of Financial Accounting Standards No. 146, Accounting for Costs Associated with Exit or Disposal Activities (SFAS 146). SFAS 146 addresses financial accounting and reporting for costs associated with exit and disposal activities and nullifies Emerging Issues Task Force Issue No. 94-3, Liability Recognition for Certain Employee Termination Benefits and Other Costs to Exit an Activity (including Certain Costs Incurred in a Restructuring) (EITF 94-3). The provisions of SFAS 146 are effective for exit or disposal activities that are initiated after December 31, 2002. The adoption of SFAS 146 is not expected to have a material impact on the Company’s consolidated financial statements.

Note L – Reclassifications

         Certain prior year amounts have been reclassified to conform to current year classifications.

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Item 2. Management’s Discussion and Analysis

         This discussion and analysis deals with comparisons of material changes in the condensed, consolidated financial statements for the three-month periods ended July 31, 2002 and July 31, 2001, respectively.

         On June 1, 2002, The Company merged the Jif peanut butter and Crisco shortening and oils businesses of The Procter & Gamble Company with and into the Company in a tax-free stock transaction. The Company successfully transitioned the Jif and Crisco businesses ahead of schedule on July 1, 2002.

         With the addition of the Jif and Crisco businesses, reportable segments have been restated to U.S. retail market and special markets. The U. S. retail market segment is composed of the Company’s consumer and consumer oils business areas and includes domestic sales of Smucker’s, Jif, and Crisco brand products at retail. The special markets segment is composed of the foodservice, international, industrial, and beverage business areas.

Results of Operations

         Sales were $274.9 million for the first quarter ended July 31, 2002, up 62 percent versus $169.8 million during the comparable period last year. The Jif and Crisco brands contributed $87.0 million to sales in the first quarter of fiscal 2003. Excluding the Jif and Crisco contribution, first quarter sales were $187.9 million, up 11 percent versus the prior year.

         Net income was $16.0 million, or $0.39 per share, for the first quarter versus $8.5 million or $0.37 per share for the first quarter of last year. Income in the first quarter included $4.9 million, or $0.07 per share, of costs associated with the merger of the Jif and Crisco brands into the Company. Excluding those costs, the Company’s earnings per share would have been $0.46 in the first quarter. Earnings per share for the first quarter of fiscal 2002 have been restated to reflect the effect of the merger exchange ratio of 0.9451 on the weighted average shares outstanding during that quarter and include, on a diluted basis, $0.02 of amortization expense not included in the current year.

         Sales for the first quarter in the U. S. retail market segment were up 96 percent over the prior year due to the addition of the Jif and Crisco businesses. Sales of Jif were responsible for consumer area revenues increasing over the prior year by more than 50%. In the consumer oils area, Crisco operations transitioned smoothly. Sales of Crisco were under competitive pressure during the last year of P&G’s ownership of that brand. Sales of the product line in June and July were consistent with the pre-merger trend.

         In August 2002, the Company announced that it was increasing the prices of its Crisco brand products in an effort to offset the substantial cost increases being seen in the market for soybean and canola oil. The increase for oils products averaged approximately 15 percent. This will be the first increase in the price of Crisco products since 1998. In addition, the Company plans to implement a price decrease on the Jif brand peanut butter products of approximately six percent, effective January 2003, in response to the decline in the cost of peanuts that is expected to result at the end of this calendar year from enactment of the Farm Security and Rural Investment Act of 2002. The decision to reduce prices on the Jif products is based on certain assumptions as to the amount of the expected decline in peanut costs and, therefore, is subject to actual cost to the Company of the 2002 peanut crop.

         Sales in the special markets segment were up 27 percent over the prior year, with increases in the beverage and industrial areas accounting for 70 percent of the segment’s growth. International sales of Jif and Crisco, mostly in Canada, also contributed modestly.

         In the beverage area, new products contributed heavily to the 48 percent sales increase in the first quarter. Contributing significantly to the increase were the seasonal Smucker’s powdered strawberry lemonade product sold in club stores and new products in the Santa Cruz Organic line.

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         Sales in the industrial area were up 40 percent in the first quarter. The increase was primarily due to the acquisition of the International Flavors and Fragrances Inc. (IFF) fruit preparations business in October 2001. The IFF acquisition contributed approximately $8.2 million to industrial sales in the first quarter. Industrial sales lost in the quarter as part of the previously announced decision to discontinue certain portions of the business were offset by the IFF acquisition contribution and by new products.

         In the foodservice area, sales were up six percent as sales and distribution of Smucker’s Uncrustables to schools continued to expand. The Company’s traditional foodservice business continues to rebound from the effects of a soft economy and weakness in the travel and leisure industry and was up four percent, led by growth in Smucker’s portion control items.

         Sales in the international area were up 23 percent over the prior year. Sales increased in several of the Company’s geographic markets, notably Canada, Brazil, and Scotland. The Company’s export business also was up over the prior year. Jif and Crisco added approximately $1.7 million to the international area, while the IFF business in Brazil contributed to that area’s overall growth for the quarter.

         Cost of products sold rose 62 percent for the first quarter primarily as a result of the Jif and Crisco merger. Flat gross margin performance was the result of sales mix as strong sales in the industrial and beverage areas, which have lower margin structures than the Company’s retail businesses, lowered overall Company gross margins. Modest increases in certain fruit costs also contributed to the margin performance. Selling, distribution, and administrative (SD&A) costs, however, were 21.8 percent of sales in the first quarter versus 24.6 percent in the first quarter last year. As a result of the SD&A improvement, the Company’s operating margin as a percent of sales improved in the first quarter to 11.8 percent (excluding one-time merger related costs) versus 9.1 percent last year.

Financial Condition – Liquidity and Capital Resources

         The financial position of the Company remains strong. Cash and cash equivalents decreased $17.8 million during the first quarter, primarily due to the customary seasonal procurement of fruit and the seasonal buildup of shortenings and oils inventories for the upcoming fall baking season. Other significant uses of cash during the quarter were the payment of merger related costs, capital expenditures, and the payment of dividends. Additional debt was not required to complete the merger of the Jif and Crisco businesses with and into the Company, and total long-term debt as a percent of total capitalization was reduced from approximately 33% at April 30, 2002, to 11% at July 31, 2002.

         Assuming there are no material acquisitions or other significant investments, the Company believes that cash on hand together with cash generated by operations and existing lines of credit will be sufficient to meet its fiscal 2003 requirements, including the payment of dividends and interest on outstanding debt.

         The Company increased quarterly dividends to $0.20 per share effective with the first quarterly dividend declared in fiscal 2003.

Recently Issued Accounting Standards

         In August 2001, the Financial Accounting Standards Board issued Statement of Financial Accounting Standards No. 144, Accounting for the Impairment or Disposal of Long-Lived Assets (SFAS 144). SFAS 144 addresses financial accounting and reporting for the impairment or disposal of long-lived assets to be held and used, to be disposed of other than by sale, and to be disposed of by sale. The Company adopted SFAS 144 as of May 1, 2002. The adoption of SFAS 144 did not have a material impact on the Company’s consolidated financial statements.

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         In July 2002, the Financial Accounting Standards Board issued Statement of Financial Accounting Standards No. 146, Accounting for Costs Associated with Exit or Disposal Activities (SFAS 146). SFAS 146 addresses financial accounting and reporting for costs associated with exit and disposal activities and nullifies Emerging Issues Task Force Issue No. 94-3, Liability Recognition for Certain Employee Termination Benefits and Other Costs to Exit an Activity (including Certain Costs Incurred in a Restructuring) (EITF 94-3). The provisions of SFAS 146 are effective for exit or disposal activities that are initiated after December 31, 2002. The adoption of SFAS 146 is not expected to have a material impact on the Company’s consolidated financial statements.

Certain Forward-Looking Statements

         This quarterly report includes certain forward-looking statements that are based on current expectations and are subject to a number of risks and uncertainties that could cause actual results to differ materially. These risks and uncertainties include, but are not limited to:

• the success and cost of integrating the Jif and Crisco businesses into the Company;

• the success and cost of new marketing and sales programs and strategies intended to promote growth in the Jif and Crisco businesses and in their respective markets;

• the success and cost of introducing new products;

• general competitive activity in the market;

• the ability of the business areas to achieve sales targets and the costs associated with attempting to do so;

• the ability of the Company from time to time to implement pricing strategies successfully;

• the ability to improve sales and earnings performance in the Company’s formulated ingredient businesses;

• the exact time frame in which the loss of sales associated with discontinued industrial contracts will occur and the Company’s ability to successfully cover or eliminate the overhead associated with those sales;

• costs associated with the implementation of new business and information systems;

• raw material and ingredient cost trends; and

• foreign currency exchange and interest rate fluctuations.

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No. 14

PART II. OTHER INFORMATION

Item 6. Exhibits and Reports on Form 8-K

(a)	Exhibits
	See the Index of Exhibits that appears on Sequential Page No. 20 of this report.
(b)	Reports on Form 8-K
	On June 1, 2002, the Company filed a Current Report on Form 8-K with the Securities and Exchange Commission reporting it completed the merger of the Jif and Crisco businesses with and into the Company.
	On June 18, 2002, the Company filed a Current Report on Form 8-K with the Securities and Exchange Commission reporting it issued a press release to announce its earnings for the fourth quarter and year ended April 30, 2002.

Sequential Page

No. 15

SIGNATURES

         Pursuant to the requirements of the Securities Exchange Act of 1934, the Company has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

September 13, 2002	THE J. M. SMUCKER COMPANY
	/s/ Steven J. Ellcessor
	BY STEVEN J. ELLCESSOR Vice President—Finance and Administration, Secretary, and Chief Financial Officer
	/s/ Timothy P. Smucker
	AND TIMOTHY P. SMUCKER Chairman and Co-Chief Executive Officer

Sequential Page

No. 16

CERTIFICATION

     In connection with the Form 10-Q of The J. M. Smucker Company for the period ended July 31, 2002, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Timothy P. Smucker, Co-Chief Executive Officer of the Company certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 302 (a) of the Sarbanes-Oxley Act of 2002, that:

(1)	I have reviewed the Report.
(2)	Based on my knowledge, the Report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this Report.
(3)	Based on my knowledge, the financial statements, and other financial information contained in the Report fairly presents in all material respects the financial condition, results of operations and cash flows of the Company as of, and for the periods presented in the Report.

Date:	September 13, 2002
		/s/ Timothy P. Smucker Name: Timothy P. Smucker Title: Co-Chief Executive Officer

Sequential Page

No. 17

CERTIFICATION

     In connection with the Form 10-Q of The J. M. Smucker Company for the period ended July 31, 2002, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Richard K. Smucker, Co-Chief Executive Officer of the Company certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 302 (a) of the Sarbanes-Oxley Act of 2002, that:

(1)	I have reviewed the Report.
(2)	Based on my knowledge, the Report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this Report.
(3)	Based on my knowledge, the financial statements, and other financial information contained in the Report fairly presents in all material respects the financial condition, results of operations and cash flows of the Company as of, and for the periods presented in the Report.

Date:	September 13, 2002
		/s/ Richard K. Smucker Name: Richard K. Smucker Title: Co-Chief Executive Officer

Sequential Page

No. 18

CERTIFICATION

     In connection with the Form 10-Q of The J. M. Smucker Company for the period ended July 31, 2002, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Steven J. Ellcessor, Chief Financial Officer of the Company certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 302 (a) of the Sarbanes-Oxley Act of 2002, that:

(1)	I have reviewed the Report.
(2)	Based on my knowledge, the Report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this Report.
(3)	Based on my knowledge, the financial statements, and other financial information contained in the Report fairly presents in all material respects the financial condition, results of operations and cash flows of the Company as of, and for the periods presented in the Report.

Date:	September 13, 2002
		/s/ Steven J. Ellcessor Name: Steven J. Ellcessor Title: Chief Financial Officer

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No. 19

CERTIFICATION

     In connection with the Form 10-Q of The J. M. Smucker Company for the period ended July 31, 2002, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), each of the undersigned officers of the Company certifies, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to such officer’s knowledge:

(1)	The Report fully complies with the requirements of Section 13(a) and 15(d) of the Securities Exchange Act of 1934; and
(2)	The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company as of the dates and for the periods expressed in the Report.

Date:	September 13, 2002
		/s/ Timothy P. Smucker Name: Timothy P. Smucker Title: Co-Chief Executive Officer
		/s/ Richard K. Smucker Name: Richard K. Smucker Title: Co-Chief Executive Officer
		/s/ Steven J. Ellcessor Name: Steven J. Ellcessor Title: Chief Financial Officer

Sequential Page

No. 20

INDEX OF EXHIBITS

That are filed with the Commission and
The New York Stock Exchange

Assigned		Sequential
Exhibit No. *	Description	Page No.
10	Consulting and Noncompete Agreements

* Exhibits 2, 3, 4, 11, 15, 18, 19, 22, 23, 24, 27 and 99 are either inapplicable to the Company or require no answer.

EX-10 3 l96177aexv10.txt EX-10 CONSULTING AND INCOMPLETE AGREEMENTS Exhibit 10 May 1, 2002 Mr. Richard K. Smucker The J. M. Smucker Company Strawberry Lane Orrville, Ohio 44667-0280 Dear Richard: The purpose of this letter agreement, together with the identical agreement that your brother is signing separately today, is to preserve the value of your family's historical involvement in the business and affairs of the Company in the event of your termination of active employment. Accordingly, this Agreement evidences your commitment to maintain your public representation of the Company for at least three years after termination, in consideration for the compensation described below, subject to the terms and conditions set forth in this Agreement. 1. GENERAL. If your employment with the Company terminates under any circumstances other than those described in Section 3, so long as you comply with Section 2, you will be entitled to receive the following compensation during the three year period ("Service Period") beginning on your termination date and ending on its third anniversary. (a) Salary. Your salary will continue at the rate in effect on your termination date, payable at the same times and in the same amounts as if your employment had not terminated. (b) Bonus. Each time the Company pays annual bonuses to its executives during the Service Period, you will receive a lump sum payment equal to one-half of the annual target award most recently approved for you by the Executive Compensation Committee under the Company's Management Incentive Plan. (c) Options and Restricted Shares. All stock options you hold under any equity incentive plan of the Company will immediately vest and all restricted shares you hold under any equity incentive plan of the Company will continue to vest during the Service Period pursuant to the vesting schedule set forth in the agreements governing the restricted shares. (d) Benefits. You and your eligible dependents will be entitled to receive those benefits and perquisites, including, without limitation, medical insurance and life insurance, but excluding stock options, restricted shares or other equity-based benefits, for which substantially all of the executives of the Company are from time to time generally eligible, as determined from time to time by the Executive Compensation Committee (the "Standard Executive Benefits Package"). At the end of the Service Period, if you elect to begin receiving your Monthly Retirement Benefit under the SERP (as such terms are defined in Section 3(a), below), you will be entitled to do so without reduction of benefits for early retirement, unless prior to the end of the Service Period you have elected to begin receiving your Monthly Retirement Benefit with such reduction factors applied. 2. PUBLIC REPRESENTATION. During the Service Period you will continue to represent the Company publicly in accordance with the wishes of the Board of Directors, and you will take such other actions as the Board or its designee may reasonably request in order to ensure the continued identification of your family and its values with the Smucker's brand. Without limiting the generality of the foregoing, during the Service Period you will: (a) attend the Annual Meeting, (b) participate in employee events, (c) appear at promotional events, (d) authorize the exclusive use of your name, persona and likeness throughout the Service Period, and thereafter insofar as your name, persona or likeness is embodied in publicity, advertising or other marketing materials used by the Company at any time before the end of the Service Period, (e) participate in high-level meetings with customers and prospective customers of the Company, and (f) represent the Company to its other constituents and the communities in which the Company operates, as appropriate. 3. CERTAIN TERMINATIONS. If your employment terminates because of your death, Disability (as defined below) or Retirement (as defined below), or if the Company terminates your employment for Cause (as defined below), or if you choose to terminate your employment for Good Reason (as defined below), your compensation will be governed by this Section 3. (a) Disability. If your employment terminates on account of your having become unable (as determined by the Board in good faith) to perform your employment duties regularly by reason of illness or incapacity for a period of more than 6 consecutive months ("Disability"), (i) you will be entitled to receive the benefits you would have received during the Service Period as described in Sections 1(a), (b) and (d) for a period of three years after the date upon which the Disability is determined to have occurred, (ii) all stock options and restricted shares granted to you under any equity incentive plan of the Company will immediately vest, (iii) you will commence receiving your Monthly Retirement Benefit (as defined in the Company's Top Management Supplemental Retirement Benefit Plan (May 1, 1999 Restatement) (the "SERP")) 2 under the SERP as of the third anniversary of the date upon which the Disability is determined to have occurred and the Monthly Retirement Benefit will be calculated without regard to the early retirement reduction factors described in Section 2.2 of the SERP, regardless of whether you have reached your Normal Retirement Date (as defined in the SERP), (iv) you will be entitled to receive any salary which has accrued but is unpaid and any reimbursable expenses which have been incurred but are unpaid and (v) you will be entitled to any option rights, restricted stock or other equity awards or plan benefits which by their terms extend beyond termination of your employment (but only to the extent provided in any option previously granted to you or any other benefit plan in which you participated as an employee of the Company). (b) Death. If your employment terminates on account of your death, your beneficiaries, your dependents or your estate, as the case may be, will be entitled to receive the benefits described in Sections 3(a)(i) through 3(a)(v), with the phrase "the date of your death" being substituted in place of "the date upon which the Disability is determined to have occurred" in subsections (a)(i) and (a)(iii). (c) Retirement. If you voluntarily terminate your employment and you commence receiving your Monthly Retirement Benefit under the SERP ("Retirement"), (i) the Company will pay you any salary which has accrued but is unpaid and will reimburse you for any reimbursable expenses which have been incurred but are unpaid, (ii) you will be entitled to any option rights, restricted stock or other equity awards or plan benefits which by their terms extend beyond termination of employment (but only to the extent provided in any option granted to you or any other benefit plan in which you participated as an employee of the Company) and (iii) you will be entitled to receive any benefits to which you are entitled pursuant to the requirements of Part 6 of Subtitle B of Title I of the Employee Retirement Income Security Act of 1974, as amended. (d) Termination by the Company without Cause. If the Company terminates your employment other than for Disability or for Cause, you will be entitled to receive the benefits described in Sections 3(a)(i) through 3(a)(v), with the phrase "the date of termination" being substituted in place of "the date upon which the Disability is determined to have occurred" in subsections (a)(i) and (a)(iii). For purposes of this Agreement, "Cause" means: (i) your willful and continued failure to perform your duties; (ii) gross negligence or willful misconduct by you with respect to the Company or any of its subsidiaries or affiliates; (iii) your breach of any of the agreements in Section 4 or 5 prior to the end of your employment with the Company; or (iv) your conviction of a felony or a crime involving moral turpitude. Notwithstanding the foregoing, in no event will you be deemed to have been terminated for "Cause" unless prior to your termination the Company has delivered to you a copy of a 3 resolution duly adopted by the affirmative vote of not less than two-thirds of the directors then in office at a meeting of the Board called and held for such purpose, after reasonable notice to you and an opportunity for you, together with your counsel (if you choose to have counsel present at such meeting), to be heard before the Board, finding that, in the good faith opinion of the Board, you committed an act constituting "Cause" and specifying the particulars of such act in detail. While such a determination will be a condition precedent for the existence of "Cause" for purposes of this Agreement, such a determination will not be determinative or create a presumption that "Cause" in fact exists and nothing in this Agreement will limit your right or the right or your beneficiaries to contest the validity or propriety of any such determination. (e) Termination by You for Good Reason. If you terminate your employment for Good Reason by means of advance written notice to the Company at least 30 days prior to the effective date of such termination identifying such termination as a termination for Good Reason and identifying the Good Reason, you will be entitled to receive the benefits described in Sections 3(a)(i) through 3(a)(v). For purposes of this Agreement, "Good Reason" means: (i) any downward adjustment by the Board in your salary; (ii) the relocation of the Company's principal executive offices or the requirement by the Company that you change your principal place of employment to any location that is in excess of 35 miles from your principal place of employment on the date of this Agreement; or (iii) any breach by the Company of this Agreement that is material and that is not cured within 30 days after written notice to the Company from you. (f) Termination by the Company for Cause. If the Company terminates your employment for Cause, you will be entitled to those rights described in Sections 3(c)(i) through 3(c)(iii). (g) Interest on Unpaid Amounts. If the Company fails to make any payment or provide any benefit required to be made or provided under this Agreement on a timely basis, the Company will pay interest on the amount or value thereof at an annualized rate of interest equal to the so-called composite "prime rate" as quoted from time to time during the relevant period in the Midwest Edition of The Wall Street Journal. This interest will be payable as it accrues on demand. Any change in the prime rate will be effective on and as of the date of such change. (h) No Mitigation. You will not be required to mitigate the amount of any payment or benefit provided for in this Agreement by seeking other employment or otherwise. It is expressly understood that the Company's payment obligations under this Agreement will cease in the event you breach any of your obligations under Section 4 or 5. 4. CONFIDENTIALITY. You acknowledge that the information, observations and data obtained by you while employed by the Company and during the continuance of the Service Period pursuant to this Agreement, as well as those obtained by you while employed by the 4 Company or any of its subsidiaries or affiliates or any predecessor prior to the date of this Agreement, concerning the business or affairs of the Company or any of its subsidiaries or affiliates or any predecessor (unless and except to the extent the foregoing become generally known to and available for use by the public other than as a result of your acts or omissions to act, "Confidential Information") are the property of the Company or such subsidiary or affiliate. Therefore, you agree that during your employment with the Company and thereafter, you will not disclose any Confidential Information without the prior written consent of the Board unless and except to the extent that such disclosure is (a) made in the ordinary course of your performance of your duties under this Agreement or (b) required by any subpoena or other legal process (in which event you will give the Company prompt notice of such subpoena or other legal process in order to permit the Company to seek appropriate protective orders), and that you will not use any Confidential Information for your own account or any other person or entity's benefit without the prior written consent of the Board. You will deliver to the Company at the termination of the later of (i) your employment or (ii) the Service Period, or at any other time the Company may reasonably request, all memoranda, notes, plans, records, reports, computer tapes and software and other documents and data (and copies thereof) relating to the Confidential Information, or to the work product or the business of the Company or any of its subsidiaries or affiliates which you may then possess or have under your control. Nothing in this Section 4 will be deemed to limit or otherwise affect any confidentiality or other similar covenant or obligation imposed on you under any other agreement with, or plan or arrangement of, the Company. 5. NONCOMPETITION, NONSOLICITATION. (a) You acknowledge that in the course of your employment with the Company and during the continuance of the Service Period; (i) you will become familiar, and during the course of your employment by the Company or any of its subsidiaries or affiliates or any predecessor prior to the date of this Agreement, you have become familiar, with trade secrets and customer lists of and proprietary information regarding the business of the Company and its subsidiaries and affiliates and predecessors; (ii) such trade secrets and customer lists of and proprietary information regarding the business of the Company and its subsidiaries and affiliates and predecessors are confidential and the exclusive property of the Company; and (iii) that your services have been and will be of special, unique and extraordinary value to the Company. You agree that you will not disclose, divulge, discuss, copy or otherwise use or cause to be used in any manner in competition with, or contrary to the interests of, the Company, the trade secrets and customer lists of and proprietary information regarding the business of the Company and its subsidiaries and affiliates and predecessors. (b) You agree that during your employment with the Company and until the later of (i) three years after termination of your employment with the Company or (ii) three years after termination of the Service Period, you will not in any manner, directly or indirectly, through any person, firm or corporation, alone or as a member of a partnership or as an officer, director, shareholder, investor or employee of or in any other corporation or enterprise or otherwise, engage or be engaged in, or assist any other person, firm, corporation or enterprise in engaging or being engaged in, any business then actively being conducted by the Company or any of its subsidiaries or affiliates or any business similar to the businesses then conducted or contemplated to be conducted by the Company or any of its subsidiaries or affiliates. 5 (c) You further agree that during your employment with the Company and until the later of (i) three years after termination of your employment with the Company or (ii) three years after termination of the Service Period, you will not in any manner, directly or indirectly, induce or attempt to induce any employee of the Company or of any of its subsidiaries or affiliates to quit or abandon his or her employ. (d) Nothing in this Section 5 will prohibit you from being: (i) a shareholder in a mutual fund or a diversified investment company or (ii) a passive owner of not more than 5% of the outstanding equity securities of any class of a corporation or other entity which is publicly traded, so long as you have no active participation in the business of such corporation or other entity. (e) In the event you violate any legally enforceable provision of this Agreement as to which there is a specific time period during which you are prohibited from taking certain actions or from engaging in certain activities, as set forth in this Agreement, then, in such event, the violation shall toll the running of such time period from the date of such violation until the violation ceases. (f) You acknowledge that you have carefully considered the nature and extent of the restrictions on you and the rights and remedies conferred on the Company under this Agreement. You further acknowledge and agree that the same are reasonable in time and territory, are designed to eliminate competition which would otherwise be unfair to the Company, do not stifle your inherent skill and experience, would not operate as a bar to your sole means of support, are fully required to protect the legitimate interests of the Company and do not confer a benefit upon the Company disproportionate to your detriment. (g) If, at the time of enforcement of this Section 5, a court holds that the restrictions stated in this Section 5 are unreasonable under circumstances then existing, you and the Company agree that the maximum period, scope or geographical area reasonable under such circumstances will be substituted for the stated period, scope or area and that the court will be allowed to revise the restrictions contained in this Section 5 to cover the maximum period, scope and area permitted by law. (h) Nothing in this Section 5 will be deemed to limit or otherwise affect any noncompetition or nonsolicitation or other similar covenant or obligation imposed on you under any other agreement with, or plan or arrangement of, the Company. 6. ENFORCEMENT. Because your services are unique and because you have access to Confidential Information and work product, you agree that the Company would be damaged irreparably in the event any of the provisions of Section 4 or 5 were not performed in accordance with their specific terms or were otherwise breached and that money damages would be an inadequate remedy for any such non-performance or breach. Therefore, the Company or its successors or assigns will be entitled, in addition to other rights and remedies existing in their favor, to an injunction or injunctions to prevent any non-performance, breach or threatened breach of any of such provisions and to enforce such provisions specifically (without posting a bond or other security). 6 7. REPRESENTATIONS. You represent and warrant to the Company that (a) the execution, delivery and performance of this Agreement by you does not and will not conflict with, breach, violate or cause a default under any contract, agreement, instrument, order, judgment or decree to which you are a party or by which you are bound, (b) you are not a party to or bound by any employment agreement, noncompete agreement or confidentiality agreement with any other person or entity and (c) upon the execution and delivery of this Agreement by the Company, this Agreement will be the valid and binding obligation of you, enforceable in accordance with its terms. 8. SURVIVAL. Subject to any limits on applicability, Sections 4 and 5 will survive and continue in full force in accordance with their terms notwithstanding any termination of your employment with the Company or the termination of the Service Period. 9. NOTICES. Any notice provided for in this Agreement must be in writing and must be either personally delivered, sent by reputable overnight carrier or mailed by first class mail, return receipt requested. Any notice to you will be delivered to the last home address on file with the Company and any notice to the Company should be delivered to: The J. M. Smucker Company Strawberry Lane Orrville, Ohio 44667-0280 Attention: General Counsel or such other address or to the attention of such other person as the recipient party has specified by prior written notice to the sending party. Any notice under this Agreement will be deemed to have been given when so delivered, sent or mailed. 10. SEVERABILITY. Whenever possible, each provision of this Agreement will be interpreted in a manner as to be effective and valid under applicable law, but if any provision of this Agreement is held to be invalid, illegal or unenforceable in any respect under any applicable law or rule in any jurisdiction, such invalidity, illegality or unenforceability will not affect any other provision or any other jurisdiction, but this Agreement will be reformed, construed and enforced in such jurisdiction as if such invalid, illegal or unenforceable provision had never been contained in this Agreement. 11. COMPLETE AGREEMENT. This Agreement embodies the complete agreement and understanding between the parties with respect to the subject matter in this Agreement and effective as of its date supersedes and preempts any prior understandings, agreements or representations by or between the parties, written or oral, which may have related to the subject matter in this Agreement in any way. 12. COUNTERPARTS. This Agreement may be executed in separate counterparts, each of which will be deemed to be an original and both of which taken together will constitute one and the same agreement. 7 13. SUCCESSORS AND ASSIGNS. This Agreement will bind and inure to the benefit of and be enforceable by you, the Company and your or its respective heirs, executors, personal representatives, successors and assigns, except that neither you nor the Company may assign any of your or its rights or delegate any of your or its obligations under this Agreement without the prior written consent of the other party. You consent to the assignment by the Company of all of its rights and obligations in this Agreement to any successor to the Company by merger or consolidation or purchase of all or substantially all of the Company's assets, provided such transferee or successor assumes the liabilities of the Company in this Agreement. 14. CHOICE OF LAW. This Agreement will be governed by the internal law, and not the laws of conflicts, of the State of Ohio. 15. AMENDMENT AND WAIVER. This Agreement may be amended only with the prior written consent of the parties, and no course of conduct or failure or delay in enforcing the provisions of this Agreement will affect the validity, binding effect or enforceability of this Agreement. 16. PROHIBITION ON PARTICIPATION. If under any provision of this Agreement you and your dependents become entitled to receive the benefits provided under the Standard Executive Benefits Package and you are not eligible to participate in any of the plans or programs set forth in the Standard Executive Benefits Package, the Company will reimburse you, on a monthly basis, for any premiums or other fees paid by you to obtain benefits (for you and your dependents) equivalent to the Standard Executive Benefits Package. 17. RIGHT TO TERMINATE AGREEMENT UPON A CHANGE IN CONTROL. Notwithstanding any provision in this Agreement to the contrary, in the event of a Change in Control (as defined from time to time in the Company's 1998 Equity and Performance Incentive Plan, or any successor to that plan), you will have the right to terminate this Agreement upon 30 days' written notice to the Company, and upon the Company's receipt of such notice this Agreement will immediately become null and void and have no further force or effect. If you agree to the terms set forth above, please sign and date a copy of this Agreement below and return it to the undersigned. Very truly yours, THE J. M. SMUCKER COMPANY By: /s/ Steven J. Ellcessor --------------------------- Steven J. Ellcessor Vice President, Finance and Administration, Secretary, and Chief Financial Officer 8 Accepted and agreed to: /s/ Richard K. Smucker Date: May 1, 2002 ------------------------------ -------------------------- Richard K. Smucker 9 May 1, 2002 Mr. Timothy P. Smucker The J. M. Smucker Company Strawberry Lane Orrville, Ohio 44667-0280 Dear Tim: The purpose of this letter agreement, together with the identical agreement that your brother is signing separately today, is to preserve the value of your family's historical involvement in the business and affairs of the Company in the event of your termination of active employment. Accordingly, this Agreement evidences your commitment to maintain your public representation of the Company for at least three years after termination, in consideration for the compensation described below, subject to the terms and conditions set forth in this Agreement. 1. GENERAL. If your employment with the Company terminates under any circumstances other than those described in Section 3, so long as you comply with Section 2, you will be entitled to receive the following compensation during the three year period ("Service Period") beginning on your termination date and ending on its third anniversary. (a) Salary. Your salary will continue at the rate in effect on your termination date, payable at the same times and in the same amounts as if your employment had not terminated. (b) Bonus. Each time the Company pays annual bonuses to its executives during the Service Period, you will receive a lump sum payment equal to one-half of the annual target award most recently approved for you by the Executive Compensation Committee under the Company's Management Incentive Plan. (c) Options and Restricted Shares. All stock options you hold under any equity incentive plan of the Company will immediately vest and all restricted shares you hold under any equity incentive plan of the Company will continue to vest during the Service Period pursuant to the vesting schedule set forth in the agreements governing the restricted shares. (d) Benefits. You and your eligible dependents will be entitled to receive those benefits and perquisites, including, without limitation, medical insurance and life insurance, but excluding stock options, restricted shares or other equity-based benefits, for which substantially all of the executives of the Company are from time to time generally eligible, as determined from time to time by the Executive Compensation Committee (the "Standard Executive Benefits Package"). At the end of the Service Period, if you elect to begin receiving your Monthly Retirement Benefit under the SERP (as such terms are defined in Section 3(a), below), you will be entitled to do so without reduction of benefits for early retirement, unless prior to the end of the Service Period you have elected to begin receiving your Monthly Retirement Benefit with such reduction factors applied. 2. PUBLIC REPRESENTATION. During the Service Period you will continue to represent the Company publicly in accordance with the wishes of the Board of Directors, and you will take such other actions as the Board or its designee may reasonably request in order to ensure the continued identification of your family and its values with the Smucker's brand. Without limiting the generality of the foregoing, during the Service Period you will: (a) attend the Annual Meeting, (b) participate in employee events, (c) appear at promotional events, (d) authorize the exclusive use of your name, persona and likeness throughout the Service Period, and thereafter insofar as your name, persona or likeness is embodied in publicity, advertising or other marketing materials used by the Company at any time before the end of the Service Period, (e) participate in high-level meetings with customers and prospective customers of the Company, and (f) represent the Company to its other constituents and the communities in which the Company operates, as appropriate. 3. CERTAIN TERMINATIONS. If your employment terminates because of your death, Disability (as defined below) or Retirement (as defined below), or if the Company terminates your employment for Cause (as defined below), or if you choose to terminate your employment for Good Reason (as defined below), your compensation will be governed by this Section 3. (a) Disability. If your employment terminates on account of your having become unable (as determined by the Board in good faith) to perform your employment duties regularly by reason of illness or incapacity for a period of more than 6 consecutive months ("Disability"), (i) you will be entitled to receive the benefits you would have received during the Service Period as described in Sections 1(a), (b) and (d) for a period of three years after the date upon which the Disability is determined to have occurred, (ii) all stock options and restricted shares granted to you under any equity incentive plan of the Company will immediately vest, (iii) you will commence receiving your Monthly Retirement Benefit (as defined in the Company's Top Management Supplemental Retirement Benefit Plan (May 1, 1999 Restatement) (the "SERP")) 2 under the SERP as of the third anniversary of the date upon which the Disability is determined to have occurred and the Monthly Retirement Benefit will be calculated without regard to the early retirement reduction factors described in Section 2.2 of the SERP, regardless of whether you have reached your Normal Retirement Date (as defined in the SERP), (iv) you will be entitled to receive any salary which has accrued but is unpaid and any reimbursable expenses which have been incurred but are unpaid and (v) you will be entitled to any option rights, restricted stock or other equity awards or plan benefits which by their terms extend beyond termination of your employment (but only to the extent provided in any option previously granted to you or any other benefit plan in which you participated as an employee of the Company). (b) Death. If your employment terminates on account of your death, your beneficiaries, your dependents or your estate, as the case may be, will be entitled to receive the benefits described in Sections 3(a)(i) through 3(a)(v), with the phrase "the date of your death" being substituted in place of "the date upon which the Disability is determined to have occurred" in subsections (a)(i) and (a)(iii). (c) Retirement. If you voluntarily terminate your employment and you commence receiving your Monthly Retirement Benefit under the SERP ("Retirement"), (i) the Company will pay you any salary which has accrued but is unpaid and will reimburse you for any reimbursable expenses which have been incurred but are unpaid, (ii) you will be entitled to any option rights, restricted stock or other equity awards or plan benefits which by their terms extend beyond termination of employment (but only to the extent provided in any option granted to you or any other benefit plan in which you participated as an employee of the Company) and (iii) you will be entitled to receive any benefits to which you are entitled pursuant to the requirements of Part 6 of Subtitle B of Title I of the Employee Retirement Income Security Act of 1974, as amended. (d) Termination by the Company without Cause. If the Company terminates your employment other than for Disability or for Cause, you will be entitled to receive the benefits described in Sections 3(a)(i) through 3(a)(v), with the phrase "the date of termination" being substituted in place of "the date upon which the Disability is determined to have occurred" in subsections (a)(i) and (a)(iii). For purposes of this Agreement, "Cause" means: (i) your willful and continued failure to perform your duties; (ii) gross negligence or willful misconduct by you with respect to the Company or any of its subsidiaries or affiliates; (iii) your breach of any of the agreements in Section 4 or 5 prior to the end of your employment with the Company; or (iv) your conviction of a felony or a crime involving moral turpitude. Notwithstanding the foregoing, in no event will you be deemed to have been terminated for "Cause" unless prior to your termination the Company has delivered to you a copy of a 3 resolution duly adopted by the affirmative vote of not less than two-thirds of the directors then in office at a meeting of the Board called and held for such purpose, after reasonable notice to you and an opportunity for you, together with your counsel (if you choose to have counsel present at such meeting), to be heard before the Board, finding that, in the good faith opinion of the Board, you committed an act constituting "Cause" and specifying the particulars of such act in detail. While such a determination will be a condition precedent for the existence of "Cause" for purposes of this Agreement, such a determination will not be determinative or create a presumption that "Cause" in fact exists and nothing in this Agreement will limit your right or the right or your beneficiaries to contest the validity or propriety of any such determination. (e) Termination by You for Good Reason. If you terminate your employment for Good Reason by means of advance written notice to the Company at least 30 days prior to the effective date of such termination identifying such termination as a termination for Good Reason and identifying the Good Reason, you will be entitled to receive the benefits described in Sections 3(a)(i) through 3(a)(v). For purposes of this Agreement, "Good Reason" means: (i) any downward adjustment by the Board in your salary; (ii) the relocation of the Company's principal executive offices or the requirement by the Company that you change your principal place of employment to any location that is in excess of 35 miles from your principal place of employment on the date of this Agreement; or (iii) any breach by the Company of this Agreement that is material and that is not cured within 30 days after written notice to the Company from you. (f) Termination by the Company for Cause. If the Company terminates your employment for Cause, you will be entitled to those rights described in Sections 3(c)(i) through 3(c)(iii). (g) Interest on Unpaid Amounts. If the Company fails to make any payment or provide any benefit required to be made or provided under this Agreement on a timely basis, the Company will pay interest on the amount or value thereof at an annualized rate of interest equal to the so-called composite "prime rate" as quoted from time to time during the relevant period in the Midwest Edition of The Wall Street Journal. This interest will be payable as it accrues on demand. Any change in the prime rate will be effective on and as of the date of such change. (h) No Mitigation. You will not be required to mitigate the amount of any payment or benefit provided for in this Agreement by seeking other employment or otherwise. It is expressly understood that the Company's payment obligations under this Agreement will cease in the event you breach any of your obligations under Section 4 or 5. 4. CONFIDENTIALITY. You acknowledge that the information, observations and data obtained by you while employed by the Company and during the continuance of the Service Period pursuant to this Agreement, as well as those obtained by you while employed by the 4 Company or any of its subsidiaries or affiliates or any predecessor prior to the date of this Agreement, concerning the business or affairs of the Company or any of its subsidiaries or affiliates or any predecessor (unless and except to the extent the foregoing become generally known to and available for use by the public other than as a result of your acts or omissions to act, "Confidential Information") are the property of the Company or such subsidiary or affiliate. Therefore, you agree that during your employment with the Company and thereafter, you will not disclose any Confidential Information without the prior written consent of the Board unless and except to the extent that such disclosure is (a) made in the ordinary course of your performance of your duties under this Agreement or (b) required by any subpoena or other legal process (in which event you will give the Company prompt notice of such subpoena or other legal process in order to permit the Company to seek appropriate protective orders), and that you will not use any Confidential Information for your own account or any other person or entity's benefit without the prior written consent of the Board. You will deliver to the Company at the termination of the later of (i) your employment or (ii) the Service Period, or at any other time the Company may reasonably request, all memoranda, notes, plans, records, reports, computer tapes and software and other documents and data (and copies thereof) relating to the Confidential Information, or to the work product or the business of the Company or any of its subsidiaries or affiliates which you may then possess or have under your control. Nothing in this Section 4 will be deemed to limit or otherwise affect any confidentiality or other similar covenant or obligation imposed on you under any other agreement with, or plan or arrangement of, the Company. 5. NONCOMPETITION, NONSOLICITATION. (a) You acknowledge that in the course of your employment with the Company and during the continuance of the Service Period; (i) you will become familiar, and during the course of your employment by the Company or any of its subsidiaries or affiliates or any predecessor prior to the date of this Agreement, you have become familiar, with trade secrets and customer lists of and proprietary information regarding the business of the Company and its subsidiaries and affiliates and predecessors; (ii) such trade secrets and customer lists of and proprietary information regarding the business of the Company and its subsidiaries and affiliates and predecessors are confidential and the exclusive property of the Company; and (iii) that your services have been and will be of special, unique and extraordinary value to the Company. You agree that you will not disclose, divulge, discuss, copy or otherwise use or cause to be used in any manner in competition with, or contrary to the interests of, the Company, the trade secrets and customer lists of and proprietary information regarding the business of the Company and its subsidiaries and affiliates and predecessors. (b) You agree that during your employment with the Company and until the later of (i) three years after termination of your employment with the Company or (ii) three years after termination of the Service Period, you will not in any manner, directly or indirectly, through any person, firm or corporation, alone or as a member of a partnership or as an officer, director, shareholder, investor or employee of or in any other corporation or enterprise or otherwise, engage or be engaged in, or assist any other person, firm, corporation or enterprise in engaging or being engaged in, any business then actively being conducted by the Company or any of its subsidiaries or affiliates or any business similar to the businesses then conducted or contemplated to be conducted by the Company or any of its subsidiaries or affiliates. 5 (c) You further agree that during your employment with the Company and until the later of (i) three years after termination of your employment with the Company or (ii) three years after termination of the Service Period, you will not in any manner, directly or indirectly, induce or attempt to induce any employee of the Company or of any of its subsidiaries or affiliates to quit or abandon his or her employ. (d) Nothing in this Section 5 will prohibit you from being: (i) a shareholder in a mutual fund or a diversified investment company or (ii) a passive owner of not more than 5% of the outstanding equity securities of any class of a corporation or other entity which is publicly traded, so long as you have no active participation in the business of such corporation or other entity. (e) In the event you violate any legally enforceable provision of this Agreement as to which there is a specific time period during which you are prohibited from taking certain actions or from engaging in certain activities, as set forth in this Agreement, then, in such event, the violation shall toll the running of such time period from the date of such violation until the violation ceases. (f) You acknowledge that you have carefully considered the nature and extent of the restrictions on you and the rights and remedies conferred on the Company under this Agreement. You further acknowledge and agree that the same are reasonable in time and territory, are designed to eliminate competition which would otherwise be unfair to the Company, do not stifle your inherent skill and experience, would not operate as a bar to your sole means of support, are fully required to protect the legitimate interests of the Company and do not confer a benefit upon the Company disproportionate to your detriment. (g) If, at the time of enforcement of this Section 5, a court holds that the restrictions stated in this Section 5 are unreasonable under circumstances then existing, you and the Company agree that the maximum period, scope or geographical area reasonable under such circumstances will be substituted for the stated period, scope or area and that the court will be allowed to revise the restrictions contained in this Section 5 to cover the maximum period, scope and area permitted by law. (h) Nothing in this Section 5 will be deemed to limit or otherwise affect any noncompetition or nonsolicitation or other similar covenant or obligation imposed on you under any other agreement with, or plan or arrangement of, the Company. 6. ENFORCEMENT. Because your services are unique and because you have access to Confidential Information and work product, you agree that the Company would be damaged irreparably in the event any of the provisions of Section 4 or 5 were not performed in accordance with their specific terms or were otherwise breached and that money damages would be an inadequate remedy for any such non-performance or breach. Therefore, the Company or its successors or assigns will be entitled, in addition to other rights and remedies existing in their favor, to an injunction or injunctions to prevent any non-performance, breach or threatened breach of any of such provisions and to enforce such provisions specifically (without posting a bond or other security). 6 7. REPRESENTATIONS. You represent and warrant to the Company that (a) the execution, delivery and performance of this Agreement by you does not and will not conflict with, breach, violate or cause a default under any contract, agreement, instrument, order, judgment or decree to which you are a party or by which you are bound, (b) you are not a party to or bound by any employment agreement, noncompete agreement or confidentiality agreement with any other person or entity and (c) upon the execution and delivery of this Agreement by the Company, this Agreement will be the valid and binding obligation of you, enforceable in accordance with its terms. 8. SURVIVAL. Subject to any limits on applicability, Sections 4 and 5 will survive and continue in full force in accordance with their terms notwithstanding any termination of your employment with the Company or the termination of the Service Period. 9. NOTICES. Any notice provided for in this Agreement must be in writing and must be either personally delivered, sent by reputable overnight carrier or mailed by first class mail, return receipt requested. Any notice to you will be delivered to the last home address on file with the Company and any notice to the Company should be delivered to: The J. M. Smucker Company Strawberry Lane Orrville, Ohio 44667-0280 Attention: General Counsel or such other address or to the attention of such other person as the recipient party has specified by prior written notice to the sending party. Any notice under this Agreement will be deemed to have been given when so delivered, sent or mailed. 10. SEVERABILITY. Whenever possible, each provision of this Agreement will be interpreted in a manner as to be effective and valid under applicable law, but if any provision of this Agreement is held to be invalid, illegal or unenforceable in any respect under any applicable law or rule in any jurisdiction, such invalidity, illegality or unenforceability will not affect any other provision or any other jurisdiction, but this Agreement will be reformed, construed and enforced in such jurisdiction as if such invalid, illegal or unenforceable provision had never been contained in this Agreement. 11. COMPLETE AGREEMENT. This Agreement embodies the complete agreement and understanding between the parties with respect to the subject matter in this Agreement and effective as of its date supersedes and preempts any prior understandings, agreements or representations by or between the parties, written or oral, which may have related to the subject matter in this Agreement in any way. 12. COUNTERPARTS. This Agreement may be executed in separate counterparts, each of which will be deemed to be an original and both of which taken together will constitute one and the same agreement. 7 13. SUCCESSORS AND ASSIGNS. This Agreement will bind and inure to the benefit of and be enforceable by you, the Company and your or its respective heirs, executors, personal representatives, successors and assigns, except that neither you nor the Company may assign any of your or its rights or delegate any of your or its obligations under this Agreement without the prior written consent of the other party. You consent to the assignment by the Company of all of its rights and obligations in this Agreement to any successor to the Company by merger or consolidation or purchase of all or substantially all of the Company's assets, provided such transferee or successor assumes the liabilities of the Company in this Agreement. 14. CHOICE OF LAW. This Agreement will be governed by the internal law, and not the laws of conflicts, of the State of Ohio. 15. AMENDMENT AND WAIVER. This Agreement may be amended only with the prior written consent of the parties, and no course of conduct or failure or delay in enforcing the provisions of this Agreement will affect the validity, binding effect or enforceability of this Agreement. 16. PROHIBITION ON PARTICIPATION. If under any provision of this Agreement you and your dependents become entitled to receive the benefits provided under the Standard Executive Benefits Package and you are not eligible to participate in any of the plans or programs set forth in the Standard Executive Benefits Package, the Company will reimburse you, on a monthly basis, for any premiums or other fees paid by you to obtain benefits (for you and your dependents) equivalent to the Standard Executive Benefits Package. 17. RIGHT TO TERMINATE AGREEMENT UPON A CHANGE IN CONTROL. Notwithstanding any provision in this Agreement to the contrary, in the event of a Change in Control (as defined from time to time in the Company's 1998 Equity and Performance Incentive Plan, or any successor to that plan), you will have the right to terminate this Agreement upon 30 days' written notice to the Company, and upon the Company's receipt of such notice this Agreement will immediately become null and void and have no further force or effect. If you agree to the terms set forth above, please sign and date a copy of this Agreement below and return it to the undersigned. Very truly yours, THE J. M. SMUCKER COMPANY By: /s/ Steven J. Ellcessor --------------------------- Steven J. Ellcessor Vice President, Finance and Administration, Secretary, and Chief Financial Officer 8 Accepted and agreed to: /s/ Timothy P. Smucker Date: May 1, 2002 ----------------------------- --------------------------- Timothy P. Smucker 9 10-Q 4 l96177ae10vqxpdfy.pdf PDF COURTESY COPY OF J.M. 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EX-10

                                                                Exhibit 10




                               May 1, 2002



Mr. Richard K. Smucker
The J. M. Smucker Company
Strawberry Lane
Orrville, Ohio 44667-0280

Dear Richard:

         The purpose of this letter agreement, together with the identical
agreement that your brother is signing separately today, is to preserve the
value of your family's historical involvement in the business and affairs of the
Company in the event of your termination of active employment. Accordingly, this
Agreement evidences your commitment to maintain your public representation of
the Company for at least three years after termination, in consideration for the
compensation described below, subject to the terms and conditions set forth in
this Agreement.

         1. GENERAL. If your employment with the Company terminates under any
circumstances other than those described in Section 3, so long as you comply
with Section 2, you will be entitled to receive the following compensation
during the three year period ("Service Period") beginning on your termination
date and ending on its third anniversary.

         (a) Salary. Your salary will continue at the rate in effect on your
termination date, payable at the same times and in the same amounts as if your
employment had not terminated.

         (b) Bonus. Each time the Company pays annual bonuses to its executives
during the Service Period, you will receive a lump sum payment equal to one-half
of the annual target award most recently approved for you by the Executive
Compensation Committee under the Company's Management Incentive Plan.

         (c) Options and Restricted Shares. All stock options you hold under any
equity incentive plan of the Company will immediately vest and all restricted
shares you hold under any equity incentive plan of the Company will continue to
vest during the Service Period pursuant to the vesting schedule set forth in the
agreements governing the restricted shares.

         (d) Benefits. You and your eligible dependents will be entitled to
receive those benefits and perquisites, including, without limitation, medical
insurance and life insurance, but excluding stock options, restricted shares or
other equity-based benefits, for which substantially all of the executives of
the Company are from time to time generally eligible, as determined from





time to time by the Executive Compensation Committee (the "Standard Executive
Benefits Package").

At the end of the Service Period, if you elect to begin receiving your Monthly
Retirement Benefit under the SERP (as such terms are defined in Section 3(a),
below), you will be entitled to do so without reduction of benefits for early
retirement, unless prior to the end of the Service Period you have elected to
begin receiving your Monthly Retirement Benefit with such reduction factors
applied.

         2. PUBLIC REPRESENTATION. During the Service Period you will continue
to represent the Company publicly in accordance with the wishes of the Board of
Directors, and you will take such other actions as the Board or its designee may
reasonably request in order to ensure the continued identification of your
family and its values with the Smucker's brand. Without limiting the generality
of the foregoing, during the Service Period you will:

         (a)  attend the Annual Meeting,

         (b)  participate in employee events,

         (c)  appear at promotional events,

         (d) authorize the exclusive use of your name, persona and likeness
throughout the Service Period, and thereafter insofar as your name, persona or
likeness is embodied in publicity, advertising or other marketing materials used
by the Company at any time before the end of the Service Period,

         (e)  participate in high-level  meetings with customers and prospective
customers of the Company, and

         (f) represent the Company to its other constituents and the communities
in which the Company operates, as appropriate.

         3. CERTAIN TERMINATIONS. If your employment terminates because of your
death, Disability (as defined below) or Retirement (as defined below), or if the
Company terminates your employment for Cause (as defined below), or if you
choose to terminate your employment for Good Reason (as defined below), your
compensation will be governed by this Section 3.

         (a) Disability. If your employment terminates on account of your having
become unable (as determined by the Board in good faith) to perform your
employment duties regularly by reason of illness or incapacity for a period of
more than 6 consecutive months ("Disability"), (i) you will be entitled to
receive the benefits you would have received during the Service Period as
described in Sections 1(a), (b) and (d) for a period of three years after the
date upon which the Disability is determined to have occurred, (ii) all stock
options and restricted shares granted to you under any equity incentive plan of
the Company will immediately vest, (iii) you will commence receiving your
Monthly Retirement Benefit (as defined in the Company's Top Management
Supplemental Retirement Benefit Plan (May 1, 1999 Restatement) (the "SERP"))


                                       2


under the SERP as of the third anniversary of the date upon which the Disability
is determined to have occurred and the Monthly Retirement Benefit will be
calculated without regard to the early retirement reduction factors described in
Section 2.2 of the SERP, regardless of whether you have reached your Normal
Retirement Date (as defined in the SERP), (iv) you will be entitled to receive
any salary which has accrued but is unpaid and any reimbursable expenses which
have been incurred but are unpaid and (v) you will be entitled to any option
rights, restricted stock or other equity awards or plan benefits which by their
terms extend beyond termination of your employment (but only to the extent
provided in any option previously granted to you or any other benefit plan in
which you participated as an employee of the Company).

         (b) Death. If your employment terminates on account of your death, your
beneficiaries, your dependents or your estate, as the case may be, will be
entitled to receive the benefits described in Sections 3(a)(i) through 3(a)(v),
with the phrase "the date of your death" being substituted in place of "the date
upon which the Disability is determined to have occurred" in subsections (a)(i)
and (a)(iii).

         (c) Retirement. If you voluntarily terminate your employment and you
commence receiving your Monthly Retirement Benefit under the SERP
("Retirement"), (i) the Company will pay you any salary which has accrued but is
unpaid and will reimburse you for any reimbursable expenses which have been
incurred but are unpaid, (ii) you will be entitled to any option rights,
restricted stock or other equity awards or plan benefits which by their terms
extend beyond termination of employment (but only to the extent provided in any
option granted to you or any other benefit plan in which you participated as an
employee of the Company) and (iii) you will be entitled to receive any benefits
to which you are entitled pursuant to the requirements of Part 6 of Subtitle B
of Title I of the Employee Retirement Income Security Act of 1974, as amended.

         (d) Termination by the Company without Cause. If the Company terminates
your employment other than for Disability or for Cause, you will be entitled to
receive the benefits described in Sections 3(a)(i) through 3(a)(v), with the
phrase "the date of termination" being substituted in place of "the date upon
which the Disability is determined to have occurred" in subsections (a)(i) and
(a)(iii).

         For purposes of this Agreement, "Cause" means:

                  (i) your willful and continued failure to perform your duties;

                  (ii)  gross  negligence  or  willful  misconduct  by you  with
         respect to the Company or any of its subsidiaries or affiliates;

                  (iii) your breach of any of the  agreements  in Section 4 or 5
         prior to the end of your employment with the Company; or

                  (iv) your  conviction of a felony or a crime  involving  moral
         turpitude.

         Notwithstanding the foregoing, in no event will you be deemed to have
been terminated for "Cause" unless prior to your termination the Company has
delivered to you a copy of a


                                       3


resolution duly adopted by the affirmative vote of not less than two-thirds of
the directors then in office at a meeting of the Board called and held for such
purpose, after reasonable notice to you and an opportunity for you, together
with your counsel (if you choose to have counsel present at such meeting), to be
heard before the Board, finding that, in the good faith opinion of the Board,
you committed an act constituting "Cause" and specifying the particulars of such
act in detail. While such a determination will be a condition precedent for the
existence of "Cause" for purposes of this Agreement, such a determination will
not be determinative or create a presumption that "Cause" in fact exists and
nothing in this Agreement will limit your right or the right or your
beneficiaries to contest the validity or propriety of any such determination.

         (e) Termination by You for Good Reason. If you terminate your
employment for Good Reason by means of advance written notice to the Company at
least 30 days prior to the effective date of such termination identifying such
termination as a termination for Good Reason and identifying the Good Reason,
you will be entitled to receive the benefits described in Sections 3(a)(i)
through 3(a)(v).

         For purposes of this Agreement, "Good Reason" means:

                  (i)  any downward adjustment by the Board in your salary;

                  (ii) the relocation of the Company's principal executive
         offices or the requirement by the Company that you change your
         principal place of employment to any location that is in excess of 35
         miles from your principal place of employment on the date of this
         Agreement; or

                  (iii) any breach by the Company of this Agreement that is
         material and that is not cured within 30 days after written notice to
         the Company from you.

         (f) Termination by the Company for Cause. If the Company terminates
your employment for Cause, you will be entitled to those rights described in
Sections 3(c)(i) through 3(c)(iii).

         (g) Interest on Unpaid Amounts. If the Company fails to make any
payment or provide any benefit required to be made or provided under this
Agreement on a timely basis, the Company will pay interest on the amount or
value thereof at an annualized rate of interest equal to the so-called composite
"prime rate" as quoted from time to time during the relevant period in the
Midwest Edition of The Wall Street Journal. This interest will be payable as it
accrues on demand. Any change in the prime rate will be effective on and as of
the date of such change.

         (h) No Mitigation. You will not be required to mitigate the amount of
any payment or benefit provided for in this Agreement by seeking other
employment or otherwise. It is expressly understood that the Company's payment
obligations under this Agreement will cease in the event you breach any of your
obligations under Section 4 or 5.

         4. CONFIDENTIALITY. You acknowledge that the information, observations
and data obtained by you while employed by the Company and during the
continuance of the Service Period pursuant to this Agreement, as well as those
obtained by you while employed by the



                                       4


Company or any of its subsidiaries or affiliates or any predecessor prior to the
date of this Agreement, concerning the business or affairs of the Company or any
of its subsidiaries or affiliates or any predecessor (unless and except to the
extent the foregoing become generally known to and available for use by the
public other than as a result of your acts or omissions to act, "Confidential
Information") are the property of the Company or such subsidiary or affiliate.
Therefore, you agree that during your employment with the Company and
thereafter, you will not disclose any Confidential Information without the prior
written consent of the Board unless and except to the extent that such
disclosure is (a) made in the ordinary course of your performance of your duties
under this Agreement or (b) required by any subpoena or other legal process (in
which event you will give the Company prompt notice of such subpoena or other
legal process in order to permit the Company to seek appropriate protective
orders), and that you will not use any Confidential Information for your own
account or any other person or entity's benefit without the prior written
consent of the Board. You will deliver to the Company at the termination of the
later of (i) your employment or (ii) the Service Period, or at any other time
the Company may reasonably request, all memoranda, notes, plans, records,
reports, computer tapes and software and other documents and data (and copies
thereof) relating to the Confidential Information, or to the work product or the
business of the Company or any of its subsidiaries or affiliates which you may
then possess or have under your control. Nothing in this Section 4 will be
deemed to limit or otherwise affect any confidentiality or other similar
covenant or obligation imposed on you under any other agreement with, or plan or
arrangement of, the Company.

         5.  NONCOMPETITION, NONSOLICITATION.

         (a) You acknowledge that in the course of your employment with the
Company and during the continuance of the Service Period; (i) you will become
familiar, and during the course of your employment by the Company or any of its
subsidiaries or affiliates or any predecessor prior to the date of this
Agreement, you have become familiar, with trade secrets and customer lists of
and proprietary information regarding the business of the Company and its
subsidiaries and affiliates and predecessors; (ii) such trade secrets and
customer lists of and proprietary information regarding the business of the
Company and its subsidiaries and affiliates and predecessors are confidential
and the exclusive property of the Company; and (iii) that your services have
been and will be of special, unique and extraordinary value to the Company. You
agree that you will not disclose, divulge, discuss, copy or otherwise use or
cause to be used in any manner in competition with, or contrary to the interests
of, the Company, the trade secrets and customer lists of and proprietary
information regarding the business of the Company and its subsidiaries and
affiliates and predecessors.

         (b) You agree that during your employment with the Company and until
the later of (i) three years after termination of your employment with the
Company or (ii) three years after termination of the Service Period, you will
not in any manner, directly or indirectly, through any person, firm or
corporation, alone or as a member of a partnership or as an officer, director,
shareholder, investor or employee of or in any other corporation or enterprise
or otherwise, engage or be engaged in, or assist any other person, firm,
corporation or enterprise in engaging or being engaged in, any business then
actively being conducted by the Company or any of its subsidiaries or affiliates
or any business similar to the businesses then conducted or contemplated to be
conducted by the Company or any of its subsidiaries or affiliates.



                                       5

         (c) You further agree that during your employment with the Company and
until the later of (i) three years after termination of your employment with the
Company or (ii) three years after termination of the Service Period, you will
not in any manner, directly or indirectly, induce or attempt to induce any
employee of the Company or of any of its subsidiaries or affiliates to quit or
abandon his or her employ.

         (d) Nothing in this Section 5 will prohibit you from being: (i) a
shareholder in a mutual fund or a diversified investment company or (ii) a
passive owner of not more than 5% of the outstanding equity securities of any
class of a corporation or other entity which is publicly traded, so long as you
have no active participation in the business of such corporation or other
entity.

         (e) In the event you violate any legally enforceable provision of this
Agreement as to which there is a specific time period during which you are
prohibited from taking certain actions or from engaging in certain activities,
as set forth in this Agreement, then, in such event, the violation shall toll
the running of such time period from the date of such violation until the
violation ceases.

         (f) You acknowledge that you have carefully considered the nature and
extent of the restrictions on you and the rights and remedies conferred on the
Company under this Agreement. You further acknowledge and agree that the same
are reasonable in time and territory, are designed to eliminate competition
which would otherwise be unfair to the Company, do not stifle your inherent
skill and experience, would not operate as a bar to your sole means of support,
are fully required to protect the legitimate interests of the Company and do not
confer a benefit upon the Company disproportionate to your detriment.

         (g) If, at the time of enforcement of this Section 5, a court holds
that the restrictions stated in this Section 5 are unreasonable under
circumstances then existing, you and the Company agree that the maximum period,
scope or geographical area reasonable under such circumstances will be
substituted for the stated period, scope or area and that the court will be
allowed to revise the restrictions contained in this Section 5 to cover the
maximum period, scope and area permitted by law.

         (h) Nothing in this Section 5 will be deemed to limit or otherwise
affect any noncompetition or nonsolicitation or other similar covenant or
obligation imposed on you under any other agreement with, or plan or arrangement
of, the Company.

         6. ENFORCEMENT. Because your services are unique and because you have
access to Confidential Information and work product, you agree that the Company
would be damaged irreparably in the event any of the provisions of Section 4 or
5 were not performed in accordance with their specific terms or were otherwise
breached and that money damages would be an inadequate remedy for any such
non-performance or breach. Therefore, the Company or its successors or assigns
will be entitled, in addition to other rights and remedies existing in their
favor, to an injunction or injunctions to prevent any non-performance, breach or
threatened breach of any of such provisions and to enforce such provisions
specifically (without posting a bond or other security).



                                       6

         7. REPRESENTATIONS. You represent and warrant to the Company that (a)
the execution, delivery and performance of this Agreement by you does not and
will not conflict with, breach, violate or cause a default under any contract,
agreement, instrument, order, judgment or decree to which you are a party or by
which you are bound, (b) you are not a party to or bound by any employment
agreement, noncompete agreement or confidentiality agreement with any other
person or entity and (c) upon the execution and delivery of this Agreement by
the Company, this Agreement will be the valid and binding obligation of you,
enforceable in accordance with its terms.

         8. SURVIVAL. Subject to any limits on applicability, Sections 4 and 5
will survive and continue in full force in accordance with their terms
notwithstanding any termination of your employment with the Company or the
termination of the Service Period.

         9. NOTICES. Any notice provided for in this Agreement must be in
writing and must be either personally delivered, sent by reputable overnight
carrier or mailed by first class mail, return receipt requested. Any notice to
you will be delivered to the last home address on file with the Company and any
notice to the Company should be delivered to:

                  The J. M. Smucker Company
                  Strawberry Lane
                  Orrville, Ohio  44667-0280
                  Attention: General Counsel

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

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

         11. COMPLETE AGREEMENT. This Agreement embodies the complete agreement
and understanding between the parties with respect to the subject matter in this
Agreement and effective as of its date supersedes and preempts any prior
understandings, agreements or representations by or between the parties, written
or oral, which may have related to the subject matter in this Agreement in any
way.

         12. COUNTERPARTS. This Agreement may be executed in separate
counterparts, each of which will be deemed to be an original and both of which
taken together will constitute one and the same agreement.



                                       7


         13. SUCCESSORS AND ASSIGNS. This Agreement will bind and inure to the
benefit of and be enforceable by you, the Company and your or its respective
heirs, executors, personal representatives, successors and assigns, except that
neither you nor the Company may assign any of your or its rights or delegate any
of your or its obligations under this Agreement without the prior written
consent of the other party. You consent to the assignment by the Company of all
of its rights and obligations in this Agreement to any successor to the Company
by merger or consolidation or purchase of all or substantially all of the
Company's assets, provided such transferee or successor assumes the liabilities
of the Company in this Agreement.

         14. CHOICE OF LAW. This Agreement will be governed by the internal law,
and not the laws of conflicts, of the State of Ohio.

         15. AMENDMENT AND WAIVER. This Agreement may be amended only with the
prior written consent of the parties, and no course of conduct or failure or
delay in enforcing the provisions of this Agreement will affect the validity,
binding effect or enforceability of this Agreement.

         16. PROHIBITION ON PARTICIPATION. If under any provision of this
Agreement you and your dependents become entitled to receive the benefits
provided under the Standard Executive Benefits Package and you are not eligible
to participate in any of the plans or programs set forth in the Standard
Executive Benefits Package, the Company will reimburse you, on a monthly basis,
for any premiums or other fees paid by you to obtain benefits (for you and your
dependents) equivalent to the Standard Executive Benefits Package.

         17. RIGHT TO TERMINATE AGREEMENT UPON A CHANGE IN CONTROL.
Notwithstanding any provision in this Agreement to the contrary, in the event of
a Change in Control (as defined from time to time in the Company's 1998 Equity
and Performance Incentive Plan, or any successor to that plan), you will have
the right to terminate this Agreement upon 30 days' written notice to the
Company, and upon the Company's receipt of such notice this Agreement will
immediately become null and void and have no further force or effect.

         If you agree to the terms set forth above, please sign and date a copy
of this Agreement below and return it to the undersigned.

                                Very truly yours,

                                THE J. M. SMUCKER COMPANY



                                     By: /s/ Steven J. Ellcessor
                                     ---------------------------
                                     Steven J. Ellcessor
                                     Vice President, Finance and Administration,
                                     Secretary, and Chief Financial Officer

                                       8



       Accepted and agreed to:



       /s/ Richard K. Smucker                   Date:  May 1, 2002
       ------------------------------                 --------------------------
       Richard K. Smucker






                                       9





                               May 1, 2002



Mr. Timothy P. Smucker
The J. M. Smucker Company
Strawberry Lane
Orrville, Ohio 44667-0280

Dear Tim:

         The purpose of this letter agreement, together with the identical
agreement that your brother is signing separately today, is to preserve the
value of your family's historical involvement in the business and affairs of the
Company in the event of your termination of active employment. Accordingly, this
Agreement evidences your commitment to maintain your public representation of
the Company for at least three years after termination, in consideration for the
compensation described below, subject to the terms and conditions set forth in
this Agreement.

         1. GENERAL. If your employment with the Company terminates under any
circumstances other than those described in Section 3, so long as you comply
with Section 2, you will be entitled to receive the following compensation
during the three year period ("Service Period") beginning on your termination
date and ending on its third anniversary.

         (a) Salary. Your salary will continue at the rate in effect on your
termination date, payable at the same times and in the same amounts as if your
employment had not terminated.

         (b) Bonus. Each time the Company pays annual bonuses to its executives
during the Service Period, you will receive a lump sum payment equal to one-half
of the annual target award most recently approved for you by the Executive
Compensation Committee under the Company's Management Incentive Plan.

         (c) Options and Restricted Shares. All stock options you hold under any
equity incentive plan of the Company will immediately vest and all restricted
shares you hold under any equity incentive plan of the Company will continue to
vest during the Service Period pursuant to the vesting schedule set forth in the
agreements governing the restricted shares.

         (d) Benefits. You and your eligible dependents will be entitled to
receive those benefits and perquisites, including, without limitation, medical
insurance and life insurance, but excluding stock options, restricted shares or
other equity-based benefits, for which substantially all of the executives of
the Company are from time to time generally eligible, as determined from


time to time by the Executive Compensation Committee (the "Standard Executive
Benefits Package").

At the end of the Service Period, if you elect to begin receiving your Monthly
Retirement Benefit under the SERP (as such terms are defined in Section 3(a),
below), you will be entitled to do so without reduction of benefits for early
retirement, unless prior to the end of the Service Period you have elected to
begin receiving your Monthly Retirement Benefit with such reduction factors
applied.

         2. PUBLIC REPRESENTATION. During the Service Period you will continue
to represent the Company publicly in accordance with the wishes of the Board of
Directors, and you will take such other actions as the Board or its designee may
reasonably request in order to ensure the continued identification of your
family and its values with the Smucker's brand. Without limiting the generality
of the foregoing, during the Service Period you will:

         (a)  attend the Annual Meeting,

         (b)  participate in employee events,

         (c)  appear at promotional events,

         (d) authorize the exclusive use of your name, persona and likeness
throughout the Service Period, and thereafter insofar as your name, persona or
likeness is embodied in publicity, advertising or other marketing materials used
by the Company at any time before the end of the Service Period,

         (e)  participate in high-level  meetings with customers and prospective
customers of the Company, and

         (f) represent the Company to its other constituents and the communities
in which the Company operates, as appropriate.

         3. CERTAIN TERMINATIONS. If your employment terminates because of your
death, Disability (as defined below) or Retirement (as defined below), or if the
Company terminates your employment for Cause (as defined below), or if you
choose to terminate your employment for Good Reason (as defined below), your
compensation will be governed by this Section 3.

         (a) Disability. If your employment terminates on account of your having
become unable (as determined by the Board in good faith) to perform your
employment duties regularly by reason of illness or incapacity for a period of
more than 6 consecutive months ("Disability"), (i) you will be entitled to
receive the benefits you would have received during the Service Period as
described in Sections 1(a), (b) and (d) for a period of three years after the
date upon which the Disability is determined to have occurred, (ii) all stock
options and restricted shares granted to you under any equity incentive plan of
the Company will immediately vest, (iii) you will commence receiving your
Monthly Retirement Benefit (as defined in the Company's Top Management
Supplemental Retirement Benefit Plan (May 1, 1999 Restatement) (the "SERP"))



                                       2


under the SERP as of the third anniversary of the date upon which the Disability
is determined to have occurred and the Monthly Retirement Benefit will be
calculated without regard to the early retirement reduction factors described in
Section 2.2 of the SERP, regardless of whether you have reached your Normal
Retirement Date (as defined in the SERP), (iv) you will be entitled to receive
any salary which has accrued but is unpaid and any reimbursable expenses which
have been incurred but are unpaid and (v) you will be entitled to any option
rights, restricted stock or other equity awards or plan benefits which by their
terms extend beyond termination of your employment (but only to the extent
provided in any option previously granted to you or any other benefit plan in
which you participated as an employee of the Company).

         (b) Death. If your employment terminates on account of your death, your
beneficiaries, your dependents or your estate, as the case may be, will be
entitled to receive the benefits described in Sections 3(a)(i) through 3(a)(v),
with the phrase "the date of your death" being substituted in place of "the date
upon which the Disability is determined to have occurred" in subsections (a)(i)
and (a)(iii).

         (c) Retirement. If you voluntarily terminate your employment and you
commence receiving your Monthly Retirement Benefit under the SERP
("Retirement"), (i) the Company will pay you any salary which has accrued but is
unpaid and will reimburse you for any reimbursable expenses which have been
incurred but are unpaid, (ii) you will be entitled to any option rights,
restricted stock or other equity awards or plan benefits which by their terms
extend beyond termination of employment (but only to the extent provided in any
option granted to you or any other benefit plan in which you participated as an
employee of the Company) and (iii) you will be entitled to receive any benefits
to which you are entitled pursuant to the requirements of Part 6 of Subtitle B
of Title I of the Employee Retirement Income Security Act of 1974, as amended.

         (d) Termination by the Company without Cause. If the Company terminates
your employment other than for Disability or for Cause, you will be entitled to
receive the benefits described in Sections 3(a)(i) through 3(a)(v), with the
phrase "the date of termination" being substituted in place of "the date upon
which the Disability is determined to have occurred" in subsections (a)(i) and
(a)(iii).

         For purposes of this Agreement, "Cause" means:

                  (i) your willful and continued failure to perform your duties;

                  (ii) gross negligence or willful misconduct by you with
         respect to the Company or any of its subsidiaries or affiliates;

                  (iii) your breach of any of the agreements in Section 4 or 5
         prior to the end of your employment with the Company; or

                  (iv) your conviction of a felony or a crime involving moral
         turpitude.

         Notwithstanding the foregoing, in no event will you be deemed to have
been terminated for "Cause" unless prior to your termination the Company has
delivered to you a copy of a


                                       3

resolution duly adopted by the affirmative vote of not less than two-thirds of
the directors then in office at a meeting of the Board called and held for such
purpose, after reasonable notice to you and an opportunity for you, together
with your counsel (if you choose to have counsel present at such meeting), to be
heard before the Board, finding that, in the good faith opinion of the Board,
you committed an act constituting "Cause" and specifying the particulars of such
act in detail. While such a determination will be a condition precedent for the
existence of "Cause" for purposes of this Agreement, such a determination will
not be determinative or create a presumption that "Cause" in fact exists and
nothing in this Agreement will limit your right or the right or your
beneficiaries to contest the validity or propriety of any such determination.

         (e) Termination by You for Good Reason. If you terminate your
employment for Good Reason by means of advance written notice to the Company at
least 30 days prior to the effective date of such termination identifying such
termination as a termination for Good Reason and identifying the Good Reason,
you will be entitled to receive the benefits described in Sections 3(a)(i)
through 3(a)(v).

         For purposes of this Agreement, "Good Reason" means:

                  (i)  any downward adjustment by the Board in your salary;

                  (ii) the relocation of the Company's principal executive
         offices or the requirement by the Company that you change your
         principal place of employment to any location that is in excess of 35
         miles from your principal place of employment on the date of this
         Agreement; or

                  (iii) any breach by the Company of this Agreement that is
         material and that is not cured within 30 days after written notice to
         the Company from you.

         (f) Termination by the Company for Cause. If the Company terminates
your employment for Cause, you will be entitled to those rights described in
Sections 3(c)(i) through 3(c)(iii).

         (g) Interest on Unpaid Amounts. If the Company fails to make any
payment or provide any benefit required to be made or provided under this
Agreement on a timely basis, the Company will pay interest on the amount or
value thereof at an annualized rate of interest equal to the so-called composite
"prime rate" as quoted from time to time during the relevant period in the
Midwest Edition of The Wall Street Journal. This interest will be payable as it
accrues on demand. Any change in the prime rate will be effective on and as of
the date of such change.

         (h) No Mitigation. You will not be required to mitigate the amount of
any payment or benefit provided for in this Agreement by seeking other
employment or otherwise. It is expressly understood that the Company's payment
obligations under this Agreement will cease in the event you breach any of your
obligations under Section 4 or 5.

         4. CONFIDENTIALITY. You acknowledge that the information, observations
and data obtained by you while employed by the Company and during the
continuance of the Service Period pursuant to this Agreement, as well as those
obtained by you while employed by the



                                       4


Company or any of its subsidiaries or affiliates or any predecessor prior to the
date of this Agreement, concerning the business or affairs of the Company or any
of its subsidiaries or affiliates or any predecessor (unless and except to the
extent the foregoing become generally known to and available for use by the
public other than as a result of your acts or omissions to act, "Confidential
Information") are the property of the Company or such subsidiary or affiliate.
Therefore, you agree that during your employment with the Company and
thereafter, you will not disclose any Confidential Information without the prior
written consent of the Board unless and except to the extent that such
disclosure is (a) made in the ordinary course of your performance of your duties
under this Agreement or (b) required by any subpoena or other legal process (in
which event you will give the Company prompt notice of such subpoena or other
legal process in order to permit the Company to seek appropriate protective
orders), and that you will not use any Confidential Information for your own
account or any other person or entity's benefit without the prior written
consent of the Board. You will deliver to the Company at the termination of the
later of (i) your employment or (ii) the Service Period, or at any other time
the Company may reasonably request, all memoranda, notes, plans, records,
reports, computer tapes and software and other documents and data (and copies
thereof) relating to the Confidential Information, or to the work product or the
business of the Company or any of its subsidiaries or affiliates which you may
then possess or have under your control. Nothing in this Section 4 will be
deemed to limit or otherwise affect any confidentiality or other similar
covenant or obligation imposed on you under any other agreement with, or plan or
arrangement of, the Company.

         5.  NONCOMPETITION, NONSOLICITATION.

         (a) You acknowledge that in the course of your employment with the
Company and during the continuance of the Service Period; (i) you will become
familiar, and during the course of your employment by the Company or any of its
subsidiaries or affiliates or any predecessor prior to the date of this
Agreement, you have become familiar, with trade secrets and customer lists of
and proprietary information regarding the business of the Company and its
subsidiaries and affiliates and predecessors; (ii) such trade secrets and
customer lists of and proprietary information regarding the business of the
Company and its subsidiaries and affiliates and predecessors are confidential
and the exclusive property of the Company; and (iii) that your services have
been and will be of special, unique and extraordinary value to the Company. You
agree that you will not disclose, divulge, discuss, copy or otherwise use or
cause to be used in any manner in competition with, or contrary to the interests
of, the Company, the trade secrets and customer lists of and proprietary
information regarding the business of the Company and its subsidiaries and
affiliates and predecessors.

         (b) You agree that during your employment with the Company and until
the later of (i) three years after termination of your employment with the
Company or (ii) three years after termination of the Service Period, you will
not in any manner, directly or indirectly, through any person, firm or
corporation, alone or as a member of a partnership or as an officer, director,
shareholder, investor or employee of or in any other corporation or enterprise
or otherwise, engage or be engaged in, or assist any other person, firm,
corporation or enterprise in engaging or being engaged in, any business then
actively being conducted by the Company or any of its subsidiaries or affiliates
or any business similar to the businesses then conducted or contemplated to be
conducted by the Company or any of its subsidiaries or affiliates.



                                       5

         (c) You further agree that during your employment with the Company and
until the later of (i) three years after termination of your employment with the
Company or (ii) three years after termination of the Service Period, you will
not in any manner, directly or indirectly, induce or attempt to induce any
employee of the Company or of any of its subsidiaries or affiliates to quit or
abandon his or her employ.

         (d) Nothing in this Section 5 will prohibit you from being: (i) a
shareholder in a mutual fund or a diversified investment company or (ii) a
passive owner of not more than 5% of the outstanding equity securities of any
class of a corporation or other entity which is publicly traded, so long as you
have no active participation in the business of such corporation or other
entity.

         (e) In the event you violate any legally enforceable provision of this
Agreement as to which there is a specific time period during which you are
prohibited from taking certain actions or from engaging in certain activities,
as set forth in this Agreement, then, in such event, the violation shall toll
the running of such time period from the date of such violation until the
violation ceases.

         (f) You acknowledge that you have carefully considered the nature and
extent of the restrictions on you and the rights and remedies conferred on the
Company under this Agreement. You further acknowledge and agree that the same
are reasonable in time and territory, are designed to eliminate competition
which would otherwise be unfair to the Company, do not stifle your inherent
skill and experience, would not operate as a bar to your sole means of support,
are fully required to protect the legitimate interests of the Company and do not
confer a benefit upon the Company disproportionate to your detriment.

         (g) If, at the time of enforcement of this Section 5, a court holds
that the restrictions stated in this Section 5 are unreasonable under
circumstances then existing, you and the Company agree that the maximum period,
scope or geographical area reasonable under such circumstances will be
substituted for the stated period, scope or area and that the court will be
allowed to revise the restrictions contained in this Section 5 to cover the
maximum period, scope and area permitted by law.

         (h) Nothing in this Section 5 will be deemed to limit or otherwise
affect any noncompetition or nonsolicitation or other similar covenant or
obligation imposed on you under any other agreement with, or plan or arrangement
of, the Company.

         6. ENFORCEMENT. Because your services are unique and because you have
access to Confidential Information and work product, you agree that the Company
would be damaged irreparably in the event any of the provisions of Section 4 or
5 were not performed in accordance with their specific terms or were otherwise
breached and that money damages would be an inadequate remedy for any such
non-performance or breach. Therefore, the Company or its successors or assigns
will be entitled, in addition to other rights and remedies existing in their
favor, to an injunction or injunctions to prevent any non-performance, breach or
threatened breach of any of such provisions and to enforce such provisions
specifically (without posting a bond or other security).



                                       6


         7. REPRESENTATIONS. You represent and warrant to the Company that (a)
the execution, delivery and performance of this Agreement by you does not and
will not conflict with, breach, violate or cause a default under any contract,
agreement, instrument, order, judgment or decree to which you are a party or by
which you are bound, (b) you are not a party to or bound by any employment
agreement, noncompete agreement or confidentiality agreement with any other
person or entity and (c) upon the execution and delivery of this Agreement by
the Company, this Agreement will be the valid and binding obligation of you,
enforceable in accordance with its terms.

         8. SURVIVAL. Subject to any limits on applicability, Sections 4 and 5
will survive and continue in full force in accordance with their terms
notwithstanding any termination of your employment with the Company or the
termination of the Service Period.

         9. NOTICES. Any notice provided for in this Agreement must be in
writing and must be either personally delivered, sent by reputable overnight
carrier or mailed by first class mail, return receipt requested. Any notice to
you will be delivered to the last home address on file with the Company and any
notice to the Company should be delivered to:

                  The J. M. Smucker Company
                  Strawberry Lane
                  Orrville, Ohio  44667-0280
                  Attention: General Counsel

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

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

         11. COMPLETE AGREEMENT. This Agreement embodies the complete agreement
and understanding between the parties with respect to the subject matter in this
Agreement and effective as of its date supersedes and preempts any prior
understandings, agreements or representations by or between the parties, written
or oral, which may have related to the subject matter in this Agreement in any
way.

         12. COUNTERPARTS. This Agreement may be executed in separate
counterparts, each of which will be deemed to be an original and both of which
taken together will constitute one and the same agreement.



                                       7

         13. SUCCESSORS AND ASSIGNS. This Agreement will bind and inure to the
benefit of and be enforceable by you, the Company and your or its respective
heirs, executors, personal representatives, successors and assigns, except that
neither you nor the Company may assign any of your or its rights or delegate any
of your or its obligations under this Agreement without the prior written
consent of the other party. You consent to the assignment by the Company of all
of its rights and obligations in this Agreement to any successor to the Company
by merger or consolidation or purchase of all or substantially all of the
Company's assets, provided such transferee or successor assumes the liabilities
of the Company in this Agreement.

         14. CHOICE OF LAW. This Agreement will be governed by the internal law,
and not the laws of conflicts, of the State of Ohio.

         15. AMENDMENT AND WAIVER. This Agreement may be amended only with the
prior written consent of the parties, and no course of conduct or failure or
delay in enforcing the provisions of this Agreement will affect the validity,
binding effect or enforceability of this Agreement.

         16. PROHIBITION ON PARTICIPATION. If under any provision of this
Agreement you and your dependents become entitled to receive the benefits
provided under the Standard Executive Benefits Package and you are not eligible
to participate in any of the plans or programs set forth in the Standard
Executive Benefits Package, the Company will reimburse you, on a monthly basis,
for any premiums or other fees paid by you to obtain benefits (for you and your
dependents) equivalent to the Standard Executive Benefits Package.

         17. RIGHT TO TERMINATE AGREEMENT UPON A CHANGE IN CONTROL.
Notwithstanding any provision in this Agreement to the contrary, in the event of
a Change in Control (as defined from time to time in the Company's 1998 Equity
and Performance Incentive Plan, or any successor to that plan), you will have
the right to terminate this Agreement upon 30 days' written notice to the
Company, and upon the Company's receipt of such notice this Agreement will
immediately become null and void and have no further force or effect.

         If you agree to the terms set forth above, please sign and date a copy
of this Agreement below and return it to the undersigned.


                                 Very truly yours,

                                 THE J. M. SMUCKER COMPANY


                                    By: /s/ Steven J. Ellcessor
                                    ---------------------------
                                    Steven J. Ellcessor
                                    Vice President, Finance and Administration,
                                    Secretary, and Chief Financial Officer




                                       8



      Accepted and agreed to:



     /s/ Timothy P. Smucker                    Date:  May 1, 2002
     -----------------------------                   ---------------------------
     Timothy P. Smucker











                                       9