Galaxy Foods Announces New Employment Agreement for CEO

Business Wire, June 17, 1999

ORLANDO, Fla.--(BUSINESS WIRE)--June 16, 1999--

Galaxy Foods Co. (Nasdaq:GALX), makers of healthy cheese and dairy-related alternatives, Wednesday announced board of director approval for a new rolling five year employment agreement with Angelo S. Morini, Galaxy's chairman, president and CEO.

This employment agreement replaces Morini's prior agreement scheduled to expire in October 2000.

Morini's new contract provides a one-time grant of options to bring his ownership percentage to 45% of the outstanding common shares. Morini's prior contract offered unlimited performance options. Other pertinent provisions include combining Morini's two outstanding loans into an interest-free single loan secured by the underlying outstanding shares, forgiving of approximately $3,000,000 in unpaid interest, converting the approximately $12,800,000 principal amount of the loan so that recourse by the company, in the event of default, is limited to the stock securing the loan and forgiving the loan entirely in the event Morini is terminated other then for cause. The agreement also increases Morini's base salary to $300,000 per year from $250,000 under the previous contract. Morini's cash bonus formula has also been reduced from a flat 5% of pre-tax income to a sliding scale.

Galaxy Foods Co. is the leading producer of health-promoting dairy and dairy-related alternatives for the retail, foodservice and industrial markets. These plant-based products, which are low or no fat (no saturated fat), have no cholesterol and no lactose and contain more vitamins and minerals then conventional dairy products, are part of the nutraceutical or functional food category, the fastest growing segment of the retail food market. The company also markets conventional dairy products for all three channels of distribution. Galaxy brand names include Veggie Slices, Veggie Milk, formagg, Soyco, Soymage, The Ultimate Smoothie, Wholesome Valley, and Lite Bakery. For more information, contact Tracy Rushwin at 407/855-5500, extension 105. You may also obtain more information from Galaxy's web site at www.galaxyfoods.com.