Homeland Stores, Inc.
                               P.O. Box 25008
                        Oklahoma City, Oklahoma 73125

                                                            
                                                    February 25, 1998
                                                            




Mr. Steven M. Mason
Homeland Stores, Inc.
P.O. Box 25008
Oklahoma City, OK 73125

Dear Steve:

          The purpose of this letter is to confirm our understanding with 
respect to a termination of your employment with Homeland Stores, Inc. 
(the "Company").

          If the Company terminates your employment prior to December 31, 
1998 for any reason other than Cause or Disability, the Company will (i) 
continue to pay you your base salary for one year after the date of your 
termination of employment, and (ii) within 5 business days after your 
employment terminates, pay you in a lump sum payment an amount equal to the 
product of (A) your target bonus under the Company's incentive bonus plan for 
the year in which your employment terminates and (B) a fraction, the numerator
of which is the number of days during such year prior to and including the 
date of your termination of employment and the denominator of which is 365.

          In the event (i) you terminate your employment for any reason, 
(ii) your employment terminates due to your death or Disability or (iii) your 
employment is terminated by the Company for Cause, you will only be entitled 
to receive the compensation and benefits payable to you under the Company's 
otherwise applicable employee benefit plans or programs.

          As used in this letter agreement, "Cause" means (i) your willful 
failure to perform substantially your duties as an officer and employee of 
the Company (other than due to physical or mental illness), (ii) your engaging 
in serious misconduct that is injurious to the Company, (iii) your having 
been convicted of, or entered a plea of nolo contendere to, a crime that 
constitutes a felony, or (iv) your unauthorized disclosure of confidential 
information (other than to the extent required by an order of a court having 
competent jurisdiction or under subpoena from an appropriate government 
agency) that has resulted or is likely to result in material economic damage 
to the Company. As used in this letter agreement, "Disability" means that, as 
a result of your incapacity due to physical or mental illness, you have been 
absent from your duties to the Company on a substantially full-time basis for 
180 days in any twelve-month period and within 30 days after the Company 
notifies you in writing that it intends to replace you, you shall not have 
returned to the performance of your duties on a full-time basis.

          All amounts payable to you hereunder will be paid net of any and 
all applicable income or employment taxes required to be withheld therefrom 
under applicable Federal, State or local laws or regulations.

          If the foregoing accurately sets forth our understanding, please so 
indicate by signing below and returning one signed copy of this letter 
agreement to me.

                                       Sincerely,

                                       HOMELAND STORES, INC.


                                       ____________________________
                                       David B. Clark
                                       President and Chief Executive Officer



ACCEPTED AND AGREED
as of this 25th day of February,
1998.


_________________________
Steven M. Mason













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