SAO PAULO, July 10 /PRNewswire-FirstCall/ -- On July 7 the Administrative Council for Economic Defense (the Brazilian anti-trust authority) - CADE signed a Transaction Reversibility Preservation Agreement (APRO) with Perdigao and Sadia with respect to the Association Agreement between the two companies.

This Agreement follows negotiations between the companies and CADE, the purpose being to ensure the reversibility of the Association Agreement until receiving a final ruling from the anti-trust authority. The APRO provides for measures to preserve continued competition between the companies while the effects of a future merger are still being examined.

The Agreement does not prevent the business condition -- it is only intended to ensure that certain actions will not become effective until a final decision is made by this authority.

    Leopoldo Viriato Saboya
    Chief Financial Officer and Investor Relations Officer
    BRF - Brasil Foods S.A
    Jose Luis Magalhaes Salazar
    Chief Financial Officer and Investor Relations Officer
    SADIA S.A.

Important Notice

This business combination involves the securities of a Brazilian company. The business combination is subject to disclosure requirements of Brazil that are different from those of the United States.

It may be difficult for you to enforce your rights and any claim you may have arising under the U.S. federal securities laws, since the issuer is located in Brazil, and some or all of its officers and directors may be residents of Brazil. You may not be able to sue a Brazilian company or its officers or directors in a Brazilian court for violations of the U.S. securities laws. It may be difficult to compel a Brazilian company and its affiliates to subject themselves to a U.S. court's judgment.

You should be aware that the issuer may purchase securities otherwise than under the exchange offer, such as in open market or privately negotiated purchases.

This communication is not an offering document and does not constitute an offer to sell or the solicitation of an offer to buy any securities or a solicitation of any vote or approval.

Investors in American Depositary Shares ('ADSs') of Sadia S.A. ('Sadia') and U.S. holders of preferred shares of Sadia are urged to read the U.S. informational document regarding the association between Sadia and Perdigao S.A. ('Perdigao' and, together with Sadia, the 'Companies'), when it becomes available, because it will contain important information.

U.S.