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Letter of Understanding / Beer Store / Production Bonus / Severance Pay / Committees /

July 1, 2004 to June 30, 2007
PACIFIC WESTERN BREWING COMPANY LTD. 2002-2005
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LETTER OF UNDERSTANDING
COMMITTEES
The Parties agree to form two (2) Committees, one (1) in Prince George and one (1) in Burnaby, which shall be staffed equally with members of the Union and the Management Team. The purpose of these Committees will be to review operating procedures, efficiencies, costs, etc. with the intention of identifying areas and procedures etc. where cost savings and improvements can be realized. Said Committees shall meet and identify projects on an annual basis including reductions in the costs per hectolitre.
In conjunction with the foregoing, they shall also devise a plan that provides for the savings realized to be divided equally, 50% to the Company and 50% divided equally between the employees, Union and non-union alike.

These Committees are to be formed with 30 days of ratification and shall develop the format and bench marking etc., not later than 90 days thereafter.

The initial bench marking date shall be June 30, 1997.

Payments shall be made annually within thirty (30) days of the Gain Share year-end, which date shall be agreed upon by the Committees.
FOR THE COMPANY	    FOR THE UNION

K. Komatsu            Tracy Robbestad

Barry Seims           Neil Glazier

Tom Leboe             Bill Hubbard

                      Gerry Bergunder

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