LETTER AGREEMENT

                                                                   EXHIBIT 10.40


                              [Company Letterhead]

January 21, 2004


                                LETTER AGREEMENT

Xxxxxxx X. Xxxxxxxxx, Trustee
Xxxx Xx Xxxxxxx Trust
0000 Xxxxx Xxxx
Xxx Xxxxx Xxxxxxx, XX 00000


         In connection with a public offering of the Common Stock of Xxxx X.
Xxxxxxxxxx & Son, Inc. (the "Company"), you have indicated a desire to include
in such offering 50,000 shares of the Common Stock of the Company owned or
controlled by you, plus an additional number of shares to be determined pursuant
to the underwriters' over-allotment option. All such shares you wish to include
in the public offering are presently held in the form of Class A Common Stock of
the Company ("Class A Stock") and would have to be converted into shares of
Common Stock to be included in the offering.

         By signing this Letter Agreement, you agree that, simultaneously upon
the purchase of the Company Common Stock by the underwriters in connection with
the public offering, you shall convert into shares of Company Common Stock (1)
50,000 shares of Class A Stock, plus (2) the number of shares of your Class A
Stock equal to the number of shares of Company Common Stock the underwriters
elect to purchase from you pursuant to their over-allotment option.
Notwithstanding the foregoing, you and the Company agree that such conversion
will not in any way be deemed effective (including, without limitation, for
purposes of Part 4 of the Company's Restated Certificate of Incorporation)
unless the underwriters purchase our Common Stock. If the underwriters do not
purchase your shares, none of your Class A Stock shall have been converted
pursuant hereto.

         Under no circumstances shall this Letter Agreement be deemed to
constitute a written notice of conversion under Part 4(f) of the Company's
Restated Certificate of Incorporation.


                                      Very truly yours,

                                      /s/ XXXXXXX X. XXXXXXXXX

                                      Xxxxxxx X. Xxxxxxxxx
                                      Xxxx X. Xxxxxxxxxx & Son, Inc.
                                      Executive Vice President Finance, Chief
                                           Financial Officer and Secretary





                                                    /s/ XXXXXXX X. XXXXXXXXX
                                         ---------------------------------------
                                      Xxxxxxx X. Xxxxxxxxx, Trustee of the Xxxx
                                                  Xx Xxxxxxx Trust