EXHIBIT 99.1
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[GRAPHIC OMITTED -- LOGO]
THE
PENN
TRAFFIC
COMPANY October 2, 2006
Xx. Xxxxxx Xxxxxxx
00 Xxx Xxxx Xxxx
Xxxxxxxxxx, Xxx Xxxx 00000
Dear Xxx.
On behalf of Xxxxxx Xxxxx, Chairman of the Board of Directors, we are
pleased to offer you the position of SVP-Co-Chief Operating Officer. Your
employment will commence on Wednesday, October 4, 2006. Your responsibilities
include Store Operations, Human Resources, Finance, Construction &
Maintenance, Legal and Real Estate. While this letter is not a contractual
agreement, it does contain the major elements of our offer to you.
1. SALARY. Your starting salary will be $375,000.00 per year,
with a performance and salary review within six months of employment.
2. SIGN-ON BONUS. $100,000.00 "grossed up," payable in 3
installments. First payment of 50% upon date you start work in Syracuse, 25%
after 3 months, and the final payment after 6 months.
3. MANAGEMENT PERFORMANCE INCENTIVE PROGRAM (BONUS). 45% of
base at 100 % of Plan, and increasing to 90% incrementally by exceeding the
plan.
4. RELOCATION PLAN. Enhanced Executive Relocation Plan,
"grossed up." In lieu of company car, Penn Traffic will provide $15,000
"grossed up" to you after 60 days of employment. Company will pay for
temporary housing not to exceed $3,000 per month and reasonable travel home
expenses for six months with employee's option to continue for an additional
three months unless Montebello home is sold.
5. BENEFITS:
MEDICAL, DENTAL, VISION AND PRESCRIPTION DRUG COVERAGE: Effective on
date of hire.
TERM LIFE (CO. PAID)*: After 31 days of continuous service. Company
paid, 1 1/2 times salary.
SUPPLEMENTAL LIFE*: After 31 days of continuous service, Employee
paid 1x or 2x or 3x Salary. (Max. $650,000).
SHORT TERM DISABILITY: Effective on date of hire: Weeks 1 through 17,
100% of salary. For weeks 18-26, NYS Statutory benefits.
LONG TERM DISABILITY: Effective on date of hire following 120 days of
disability, $5,000/mo. max. (Company paid).
*The combined maximum for Basic and Supplemental Life is $650,000.
6. VACATION. Four weeks paid vacation each year.
7. 401(K) PLAN. Effective after 6-months of employment. Subject
to the limits required by law and the Plan, (a) may defer from 1-25% of
salary, taxed deferred, (b) Company to match 50% of first 3% of employee
deferral after 1 year of employment. In addition, company to contribute 3% of
your earned total compensation after 1 year of service and 1,000 hours and
must be on payroll on last day of year.
8. PENN TRAFFIC HOLIDAYS. Per Company Plan, currently six (6).
9. 5% EMPLOYEE DISCOUNT.
10. SEVERANCE PLAN. 52 weeks of Severance.
11. CHANGE OF CONTROL. See attached document.
12. STOCK. You will participate in the company plan and receive
stock commensurate with your position at the time when the plan is executed
for the management team.
It is important to reiterate that this letter is an offer of
employment, and in no way should be construed to be an employment contract for
definite term. Employment at The Penn Traffic Company is at-will, subject to
termination by the Company or you at any time.
We look forward to you joining the Penn Traffic team. If you have any
questions regarding this offer letter or the position, please contact me
directly.
Sincerely,
By: /s/ Xxxxxx X. Xxxxxxxx
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Xxxxxx X. Xxxxxxxx
Vice President, Human Resources
The Penn Traffic Company
cc: Xxxxxx Xxxxx
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Xx. Xxx Xxxxxxx:
As agreement with the terms of this letter, please sign one copy of
this letter and retain the second copy for your files. Please return to my
attention by 3 PM today, Monday, October 2, 2006.
I, Xxxxxx X. Xxxxxxx accept this offer on this 2nd day of October, 2006.
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(Please print)
/s/ Xxx Xxxxxxx
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(Signature)
