Del Monaco Foods, LLC dba Kettle Cuisine

1 ETP 130 - Single (05/02/16) 1 of 5 RETRAINEE - JOB CREATION Training Proposal for: Del Monaco Foods, LLC dba Kettle Cuisine Agreement Number: ET18-0198 Panel Meeting of: March 23, 2018 ETP Regional Office: San Francisco Bay Area Analyst: L. Lai PROJECT PROFILE Contract Attributes: Critical Proposal Job Creation Initiative Priority Rate Retrainee Industry Sector(s): Manufacturing Priority Industry: Yes No Counties Served: Santa Clara Repeat Contractor: Yes No Union(s): Yes No Number of Employees in: CA: 120 : 500 Worldwide: 500 Turnover Rate: 5% Managers/Supervisors: (% of total trainees) 6% FUNDING DETAIL Program Costs - (Substantial Contribution) (High Earner Reduction) = Total ETP Funding $384,000 $0 $0 $384,000 In-Kind Contribution.

2 100% of Total ETP Funding Required $500,000 Del Monaco Foods, LLC dba Kettle Cuisine March 23, 2018 ET18-0198 ETP 130 - Single (05/02/16) 2 of 5 TRAINING PLAN TABLE 2 Job Creation Critical Proposal Priority Rate Business Skills, Computer Skills, Cont. Imp., Mfg. Skills 80 8-200 -0- $3,000 $ Weighted Avg: 150 Minimum Wage by County: Job Number 1: $ per hour in Santa Clara County Job Number 2 (Job Creation): $ per hour in Santa Clara County Health Benefits: Yes No This is employer share of cost for healthcare premiums medical, dental, vision. Used to meet the Post-Retention Wage?: Yes No Maybe Up to $ per hour may be used to meet the Post-Retention Wage in Job Number 1; and up to $ per hour in Job Number 2.

3 Wage Range by Occupation Occupation Titles Wage Range Estimated # of Trainees Job Number 1 Administrative Staff 5 Cooking Staff 37 Maintenance Staff 5 Manager 5 Production Staff 20 Sanitation Staff 8 Job Number 2 Job Creation Administrative Staff 5 Cooking Staff 37 Maintenance Staff 5 Manager 5 Production Staff 20 Sanitation Staff 8 Job No.

4 Job Description Type of Training Estimated No. of Trainees Range of Hours Average Cost per Trainee Post-Retention Wage Class / Lab CBT 1 Retrainee Critical Proposal Priority Rate Business Skills, Computer Skills, Cont. Imp., Mfg. Skills 80 8-200 -0- $1,800 $ Weighted Avg: 100 Del Monaco Foods, LLC dba Kettle Cuisine March 23, 2018 ET18-0198 ETP 130 - Single (05/02/16) 3 of 5 Critical Proposal Del Monaco Foods, LLC dba Kettle Cuisine ( Kettle Cuisine ) is designated a Critical Proposal , as defined in Title 22, California Code of Regulations (CCR) , by the Governor s Office of Business and Economic Development (Go-BIZ). Kettle Cuisine is expanding its Morgan Hill facility and workforce due to a significant increase in production.

5 This project will assist Kettle Cuisine to develop new job skills for newly hired and incumbent workers. INTRODUCTION Kettle Cuisine , founded in Massachusetts in 1986, expanded to California in 2016 by buying the Del Monaco Foods plant in Morgan Hill. The company makes soups in small batches from natural foods, packages it in others brands and ships it refrigerated or frozen. Kettle Cuisine currently supplies retailers such as Whole Foods, Trader Joe s and Erik s Delis with its soups, and foodservice companies that sell to restaurants, institutions and retailers. The Morgan Hill plant supplies refrigerated and frozen soups to most of the Western states with some deliveries now to the Midwest and Southeast. The company buys its all-natural ingredients from regional suppliers such as organic milk from Petaluma Creamery in Petaluma, and fresh vegetables from Tanimura & Antle farms in Salinas.

6 PROJECT DETAILST raining is driven by a major company expansion to satisfy consumer demand for real foods made out of healthy ingredients that are convenient and taste good. The Company has grown by 30% in the past year as consumers look for healthier foods. It expects to double its present size in the next 18 months as the trend continues and canned soups sales decline in the United States and Canada. As Kettle Cuisine grows, operational processes must be streamlined and standardized to increase efficiencies and eliminate waste. Additionally, cross-training is needed to create a flexible workforce. Retrainee - Job Creation The Panel offers incentives to companies that commit to hiring new employees. Training for newly-hired employees will be reimbursed at a higher rate and trainees will be subject to a lower post-retention wage.

7 Kettle Cuisine has committed to hiring 80 new employees (Job Number 2). The date-of-hire for trainees will be within the three-month period before contract approval or within the term-of-contract. These trainees will be hired into net new jobs as a condition of contract. The Company has started a $26 million expansion of the Morgan Hill plant and plans to hire 80 new, fulltime workers. The new jobs are to be created this March to June, with much of the necessary skills training completed by September when the expanded plant expects to be go into full production. Training Plan Training will be delivered via class/lab and E-learning by in-house experts and vendors as needed in the following: Del Monaco Foods, LLC dba Kettle Cuisine March 23, 2018 ET18-0198 ETP 130 - Single (05/02/16) 4 of 5 Business Skills: Training will be offered to Administrative Staff and Managers in Accounting, Business Planning, Inventory and Supplier Management.

8 Training will provide workers the necessary skillset to administer the larger enterprise. Computer Skills: Training will be offered to all occupations and focus on various application software to manage inventory and production. Manufacturing Skills: Training will be offered to Cooking, Maintenance, Production and Sanitation Staff. Topics include food preparation, Kettle cooking, recipe development, maintenance and troubleshooting, sanitation systems and processes. Training will focus on improving formalize systems and processes Continuous Improvement: Training will be offered to all occupations in various process improvement tools, failure analysis techniques and teamwork. Training will ensure that all products sold to customers are of the highest standards and quality.

9 Commitment to Training The Company s current training budget is $200,000 and for orientation, on-the-job training, safety, harassment prevention and other compliance training. ETP funds will not displace the existing financial commitment to training. Safety training is provided in accordance with all pertinent requirements under state and federal law. Training Infrastructure The Plant Manager will have overall management responsibility of the contract. The Human Resource Manager and Training Coordinator will schedule and coordinate day-to-day training and collect training documentation. Steve Duscha Advisories has been retained for project administration services. Soup is a seasonal business, and the Company plans to hire and train newest employees in April, May and June, as the slow season starts, with training completed when the soup season begins in September.

10 The five-month period from April to September will be an intense training period. Existing workers will also be trained during this period as they shift jobs to accommodate new hires and all employees learn new skills needed to make the expanded production facility a success. Impact/Outcome Training will help the Company maintain its Level 3 Safe Quality Foods certification required by customers. RECOMMENDATION Staff recommends approval of this proposal. DEVELOPMENT SERVICES Steve Duscha Advisories in Sacramento assisted with development for a flat fee of $15,000. ADMINISTRATIVE SERVICES Steve Duscha Advisories will also perform administrative services for a fee not to exceed 13% of payment earned. Del Monaco Foods, LLC dba Kettle Cuisine March 23, 2018 ET18-0198 ETP 130 - Single (05/02/16) 5 of 5 TRAINING VENDORS To Be Determined Del Monaco Foods, LLC dba Kettle Cuisine ET18-0198 ETP 100 Exhibit B Menu Curriculum (07/07/14) 1 of 2 Exhibit B: Menu Curriculum Class/Lab/E-Learning Hours 8 - 200 Trainees may receive any of the following.