THE CORPORATE LIBRARY

Related Party Transactions and Outside Related Director Information

Reddy Ice Holdings, Inc. (FRZ)

4/17/2006 Proxy Information

Monitoring and Management Services Agreement

Reddy Group, Trimaran Fund Management, L.L.C., or Trimaran, and an entity affiliated with Bear Stearns Merchant Banking, or BSMB, were parties to a Monitoring and Management Services Agreement, pursuant to which Trimaran and an entity affiliated with BSMB provided monitoring and management services to Reddy Group with respect to financial and operating matters. Pursuant to the agreement, at the closing of the acquisition of Packaged Ice on August 15, 2003, Trimaran and an entity affiliated with BSMB received a transaction fee equal to $7.5 million in connection with services rendered in connection with the merger. Pursuant to the agreement, Trimaran and an entity affiliated with BSMB also received an annual fee for ongoing monitoring and management services equal to $0.6 million per annum (pro forma for the acquisition of Triangle and other businesses). The agreement also provided that Trimaran and BSMB would be reimbursed for their reasonable out-of-pocket expenses in connection with activities undertaken pursuant to the agreement and would be indemnified for liabilities incurred in connection with their role under the agreement, other than for liabilities resulting from their gross negligence or willful misconduct.

Trimaran, BSMB and certain of their respective affiliates also rendered additional services in connection with acquisitions, divestitures and financings. In connection with these services, under certain circumstances, Trimaran and BSMB earned a fee equal to 2% of the value of any such transactions over $10 million in value. In addition, the annual monitoring and management services fee was increased in connection with acquisitions by an amount equal to 1% of the trailing twelve month pro forma EBITDA of acquired businesses (calculated at the time any acquisition by Reddy Group was consummated). Upon consummation of our initial public offering, we terminated this agreement and made payments to each of Trimaran and an entity affiliated with BSMB of $2.0 million.

Certain Transactions Relating to our Initial Public Offering

In connection with our initial public offering, the Company paid certain members of management and other employees cash bonuses totaling approximately $1.2 million and issued 25,817 shares of common stock to certain employees.

Pursuant to the directed share program in connection with our initial public offering, McCarter C. Weaver, the father of Jimmy C. Weaver, our President and Chief Operating Officer and a Director, purchased 6,600 shares of our common stock at the initial public offering price of $18.50 per share, for a total purchase price of $122,100.

Indemnification of Directors and Officers

For a period of six years after the acquisition of Packaged Ice on August 15, 2003, the Company has agreed to cause Reddy Group to:

Š indemnify and hold harmless, and provide advancement of expenses to, persons who at the closing of the merger were serving, or at any time prior to the closing of the merger have served, as one of our or our subsidiaries’ officers or directors, to the fullest extent permitted by law, and shall cause the surviving corporation to assume our obligations under any indemnification agreements; and

Š cause to be maintained in effect policies of directors’ and officers’ insurance, for the benefit of those persons who are covered by directors’ and officers’ liability insurance at the closing of the merger, providing coverage that is at least equal to the coverage provided under the current directors’ and officers’ liability insurance policies, to the extent that such liability insurance can be maintained at an annual cost to the Company that is not greater than 200% of the premium for the directors’ and officers’ liability insurance for the year prior to the closing of the merger and related transactions.

At the closing of the acquisition, each of the executive officers, including the Named Executive Officers, and all directors entered into indemnity agreements with both Reddy Group and the Company, pursuant to which both entities have agreed to indemnify and hold harmless each executive officer and director for acting in his capacity as our officer or director to the fullest extent permitted under applicable law, respectively. Indemnity will not extend to gross negligence, willful misconduct or bad faith. In addition, the Company will maintain a directors’ and officers’ insurance policy.

Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers or persons controlling us pursuant to the foregoing, we have been informed that, in the opinion of the SEC, such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable.

Purchasing Initiative

The Company is one of several portfolio companies in which BSMB has an interest. In 2004, BSMB initiated a process to identify areas where cost savings may be achieved by its portfolio companies by coordinating the purchase activities of these companies to take advantage of volume purchase discounts that would otherwise not be available to the Company if it were acting independently. In connection with this undertaking, BSMB entered into consulting arrangements with individuals and consulting firms. The consulting fees are charged to BSMB’s portfolio companies based on each company’s pro rata share of the overall cost savings achieved. As of December 31, 2005, based on information received from BSMB, the Company’s share of the consulting fees will be approximately $0.2 million.