EXHIBIT 10.69

SEVERANCE AGREEMENT

FOR VICE PRESIDENTS AND SENIOR VICE PRESIDENTS,

AND EXECUTIVE VICE PRESIDENTS WITH LESS THAN THREE YEARS

IN AN OFFICER POSITION

THIS AGREEMENT (the “Agreement”) is made and entered into as of this 11th day of
December, 2006, by and between Unified Western Grocers, Inc. (the “Company”)
located at 5200 Shelia Street Commerce, California 90040 and Randall G. Scoville
(the “Executive”).

WHEREAS, the Company considers the establishment and maintenance of a sound and
vital management to be essential to protecting and enhancing the best interests
of the Company and its shareholders; and

WHEREAS, the Executive’s position has been determined to be an important part of
the senior management team of the Company; and

WHEREAS, the Company recognizes that the possibility of termination due to
Change of Control, Good Reason or without cause creates uncertainty among
management personnel of the Company and may result in the departure or
distraction of management personnel, all to the detriment of the Company and its
shareholders.

NOW, THEREFORE, in consideration of the promises and of the mutual covenants
herein contained, the following is an agreement to provide severance benefits to
the Executive, pursuant to a severance plan generally benefiting selected
similarly situated executives, in the event the Executive’s employment with the
Company is terminated under the circumstances described herein.

 

1. Right to Terminate. The Company or the Executive may terminate the
Executive’s employment at any time, subject to the Company providing the
benefits hereinafter specified in accordance with the terms and eligibility
requirements of this Agreement. Nothing contained in this Agreement is intended
to be nor should be construed to create a contract of employment for a specified
period of time, or otherwise change or alter the at-will nature of the
Executive’s employment with the Company.

 

2. Eligibility Requirements. The Executive shall be entitled to the benefits
provided in Section 5 upon his termination of employment from the Company
subject to the following terms and conditions:

 

  (a) The Company must have employed him as an Officer immediately prior to the
date of this Agreement, and “Officer” shall mean officers of the Company
designated as such by and elected by the Board of Directors of the Company.

 

  (b) his termination is caused:

 

  (i) by the Company other than for Cause or Death;

 

  (ii) by Disability as defined below;

 

  (iii) by the Executive for Good Reason; or

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SEVERANCE AGREEMENT

FOR VICE PRESIDENTS AND SENIOR VICE PRESIDENTS,

AND EXECUTIVE VICE PRESIDENTS WITH LESS THAN THREE YEARS

IN AN OFFICER POSITION

 

  (iv) by the Executive within one (1) year of a Change of Control (as all such
capitalized terms are hereinafter defined).

“Cause” means termination upon (i) the willful and continued failure by the
Executive to perform substantially his duties (other than any such failure
resulting from the Executive’s incapacity due to physical or mental illness),
after demand for substantial performance is delivered in writing by the Company
to the Executive that specifically identifies the manner in which the Company
believes the Executive has not substantially performed his duties, (ii) the
willful engaging by the Executive in illegal or fraudulent misconduct which is
materially injurious to the Company, or (iii) the willful material breach of the
Confidentiality and Nonsolicitation Agreement set forth in Section 7. No act, or
failure to act, on the Executive’s part shall be considered “willful” unless
done, or omitted to be done, by him not in good faith and without reasonable
belief that his action or omission was in the best interest of the Company.

“Disability” means the Executive’s incapacity due to physical or mental illness
to perform substantially his duties on a full-time basis for six (6) consecutive
months and, within thirty (30) days after a notice of termination is thereafter
given by the Company, the Executive shall not have returned to the full-time
performance of the Executive’s duties. However, if the Executive shall not agree
with the determination to terminate him because of Disability, the question of
the Executive’s disability shall be subject to the certification of a qualified
medical doctor agreed to by the Company and the Executive or Executive’s legal
representative, in the event of the Executive’s incapacity to designate a
doctor. In the absence of an agreement between the Company and the Executive,
each party shall nominate a qualified medical doctor and the two doctors shall
select a third doctor, who shall make the determination as to Disability.

“Good Reason” means (i) an adverse change in the Executive’s status or
position(s), in effect immediately prior to the date of this Agreement, or
(ii) a reduction in the Executive’s base salary; provided, however, that any
such basis for Good Reason shall be recognized only if the Executive has
provided the Company written notice of the existence of such Good Reason within
ninety (90) days of its first occurrence and the Company has failed to correct
the matter within thirty (30) days of such notice.

“Change of Control” means any of (i) the acquisition by any person, entity or
group within the meaning of Section 13(d) or 14(d) of the Securities and
Exchange Act of 1934, of beneficial ownership of more than fifty percent
(50%) of the outstanding Class A Shares of United Western Grocers, Inc.; (ii) if
the individuals who presently serve on the Board of Directors no longer
constitute a majority of the members of the Company’s Board of Directors;
provided, however that any person who becomes a director subsequent to the
commencement date of this Agreement who was elected to fill a vacancy by a
majority of the Company’s members shall be considered as if a member prior to
the commencement date of this Agreement; and (iii) a liquidation or dissolution
of the Company or the sale of all or substantially all of the assets of the
Company.

 

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SEVERANCE AGREEMENT

FOR VICE PRESIDENTS AND SENIOR VICE PRESIDENTS,

AND EXECUTIVE VICE PRESIDENTS WITH LESS THAN THREE YEARS

IN AN OFFICER POSITION

The Executive will not be deemed to have been terminated without Cause by the
Company and entitled to severance benefits under this Agreement merely by reason
of the acquisition of the Company, if the Executive continues to be employed by
any successor entity described in Section 8(a). This provision, however, will
not affect the right of the Executive to receive benefits due to a termination
caused by the Executive for Good Reason or a Change in Control under Sections
2(b)(iii) and (iv).

 

3. Notice of Termination. Any purported termination by the Company or by the
Executive shall be communicated by written Notice of Termination to the other
party hereto. For purposes of this Agreement, a “Notice of Termination” means a
notice indicating the specific termination provision in this Agreement relied
upon.

 

4. Date of Termination. “Date of Termination” means the date set forth by
written Notice of Termination or, if none, then by mutual written agreement of
the parties.

 

5. Benefits Upon Termination.

 

  (a) Subject to Section 9 hereof, if the Executive’s termination of employment
with the Company satisfies the conditions set forth in Section 2, then the
Executive will be paid the equivalent of twelve (12) month’s pay based on an
amount equal to the Executive’s highest annual base salary during the three year
period immediately prior to the Date of Termination, plus an amount equal to one
(1) times the highest annual incentive bonus paid during the three year period
prior to the Date of Termination. The Executive’s severance benefits shall be
paid within ten (10)-business days of the Date of Termination, unless otherwise
mutually agreed between the Executive and the Company. Payments made under this
subsection (a) shall not be taken into account under any other retirement plan
of the Company.

 

  (b) With respect to the Executive’s continued coverage under the Company’s
health insurance plan, or successor plan, the Executive’s “qualifying event” for
purposes of the Consolidated Omnibus Budget Reconciliation Act of 1985 (“COBRA”)
shall be his Date of Termination from the Company. If the Executive elects to
continue health plan coverage pursuant to COBRA, the Company shall pay the
Executive’s COBRA premiums for a period terminating on the earlier of (i) twelve
(12) months from the Date of Termination or (ii) the cessation of COBRA
eligibility and coverage for the Executive (without regard to any other COBRA
qualified beneficiary). The Company’s obligation with respect to subsection (b)
shall continue only if the Executive satisfies on a timely basis all of his
premium payment obligations under COBRA. As applicable continued coverage under
this subsection (b) shall be coordinated with corresponding benefits that the
Executive may be eligible to receive under the Officer Retiree Medical Plan.

 

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SEVERANCE AGREEMENT

FOR VICE PRESIDENTS AND SENIOR VICE PRESIDENTS,

AND EXECUTIVE VICE PRESIDENTS WITH LESS THAN THREE YEARS

IN AN OFFICER POSITION

 

  (c) All unpaid benefits set forth in this section shall be forfeited if the
Executive violates any material provision of this Agreement including, without
limitation, the Confidentiality and Nonsolicitation Agreement set forth in
Section 7.

 

  (d) If the Executive’s termination of employment with the Company does not
satisfy the conditions set forth in Section 2, no payment or benefits shall be
provided under this Agreement. This Agreement does not, and is not intended to,
limit any rights or benefits of the Executive pursuant to any other
non-severance type plan, policy or written agreement; provided, however, that
this Agreement is intended to be the sole agreement governing severance-type
benefits. Under no circumstances will the Executive be entitled to or eligible
for any other severance type benefits from the Employer, including any
obligations that existed under any prior agreements including but not limited to
prior severance agreements or under the Unified Western Grocers’ Separation
Payment Program.

 

6. No Obligation to Mitigate. The Executive is under no obligation to mitigate
damages in the amount of any payment provided for hereunder by seeking other
employment or otherwise. Subject to section 5(b), the amount of any payment
provided for in this Agreement shall not be reduced, offset or subject to
recovery by the Company by reason of any compensation earned by the Executive as
the result of employment by another employer after the Date of Termination, or
otherwise.

 

7. Confidentiality and Nonsolicitation Agreement.

 

  (a) The Executive acknowledges that in the course of his employment by the
Company, he will have access to and become informed of confidential and secret
information which is a competitive asset of the Company (“Confidential
Information”), including (i) the terms of any agreement between the Company and
any employee, customer or supplier, (ii) pricing strategy, (iii) product
development strategies, (iv) personnel training and development programs,
(v) financial results, (vi) strategic plans and demographic analyses,
(vii) proprietary computer and systems software, and (viii) any confidential
non-public information received from the Company concerning the Company, its
employees, suppliers and customers.

 

  (b) The Executive agrees that he will keep all Confidential Information in
strict confidence during the term of his employment by the Company and
thereafter and will never make known, divulge, reveal, furnish, make available,
or use any Confidential Information (except in the course of his regular
authorized duties on behalf of the Company). The Executive agrees that the
obligations of confidentiality hereunder shall survive termination of his
employment at the Company regardless of any actual or alleged breach by the
Company of this Agreement and shall continue for one (1) year following such
termination provided that such obligation shall terminate earlier (i) as to
specific information

 

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SEVERANCE AGREEMENT

FOR VICE PRESIDENTS AND SENIOR VICE PRESIDENTS,

AND EXECUTIVE VICE PRESIDENTS WITH LESS THAN THREE YEARS

IN AN OFFICER POSITION

that shall have become known through no fault of the Executive or (ii) as to
Confidential Information which the Executive is required by law to disclose
(after giving the Company notice and an opportunity to contest such
requirement). The Executive’s obligations under this Section 7 are in addition
to, and not in limitation or preemption of, any other obligation of
confidentiality which the Executive may have to the Company under general legal
or equitable principles.

 

  (c) Except in the ordinary course of the Company’s business, the Executive has
not made, nor shall at any time following the date of this Agreement, make or
cause to be made, any copies, pictures, duplicates, facsimiles, or other
reproductions or recordings or any abstracts or summaries including or
reflecting Confidential Information. All such documents and other property
furnished to the Executive by the Company or otherwise acquired or developed by
the Company shall at all times be the property of the Company. Upon termination
of the Executive’s employment by the Company, the Executive will immediately
return to the Company any such documents or other property of the Company which
are in the possession, custody or control of the Executive.

 

  (d) In the event of the Executive’s termination of employment at the Company,
the Executive agrees that he will not in any capacity, on his own behalf or on
behalf of any other firm, person, or entity, for a period of one (1) year,
solicit, or assist in the solicitation of, any employee of the Company to
terminate his or her employment with the Company.

 

  (e) The Executive acknowledges and agrees that a violation of the foregoing
provisions of this Section 7 (referred to collectively as the “Confidentiality
and Nonsolicitation Agreement”) that results in material detriment to the
Company would cause irreparable harm to the Company, and that the Company’s
remedy at law for any such violation would be inadequate. In recognition of the
foregoing, the Executive agrees that, in addition to any other relief afforded
by law or this Agreement, including damages sustained by a breach of this
Agreement and forfeiture of any and all compensation or benefit otherwise
provided under Section 5, and without any necessity or proof of actual damages,
the Company shall have the right to enforce this Confidentiality and
Nonsolicitation Agreement by specific remedies, which shall include, among other
things, temporary and permanent injunctions, it being the understanding of the
undersigned parties hereto that damages, the forfeitures described above and
injunctions shall all be proper modes of relief and are not to be considered as
alternative remedies.

 

8. Successors; Binding Agreement.

 

  (a) The Company will require any successor (whether direct or indirect, by
purchase, merger, consolidation, reorganization or otherwise) by agreement in
form and substance satisfactory to the Executive, expressly to assume and agree
to perform this Agreement in the same manner and to the same extent the Company
would be required to perform if no such succession had taken place.

 

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SEVERANCE AGREEMENT

FOR VICE PRESIDENTS AND SENIOR VICE PRESIDENTS,

AND EXECUTIVE VICE PRESIDENTS WITH LESS THAN THREE YEARS

IN AN OFFICER POSITION

 

  (b) This Agreement shall inure to the benefit of and be enforceable by the
Executive’s personal or legal representatives, executors, administrators,
successors, heirs, distributees, devisees, and legatees. If the Executive should
die while any amount would still be payable to the Executive hereunder if he had
continued to live, all such amounts, unless otherwise provided herein, shall be
paid in accordance with the terms of this Agreement to the Executive’s devisee,
legatee, or other designee, or if there be no such designee, to the Executive’s
estate.

 

  (c) This Agreement, and all of the provisions hereof, shall be binding upon
the Company and all of its affiliates, successors, transferees, or surviving or
continuing entity.

 

9. Taxes.

 

  (a) All payments to be made to the Executive under this Agreement will be
subject to required withholding of federal, state, and local income and
employment taxes.

 

  (b) Notwithstanding anything in the foregoing to the contrary, if any of the
payments provided for in this Agreement, together with any other payments which
the Executive has the right to receive from the Company, would constitute an
“excess parachute payment” (as defined in Internal Revenue Code §280G(b)(2) as
it may be amended), so as to cause the imposition of an excise tax payment
pursuant to this Agreement shall be reduced by an amount sufficient to avoid the
payment of an any such excise tax; provided, however, that the determination as
to whether any reduction in the payments otherwise owing under this Agreement
pursuant to this provision is necessary shall be made jointly by the Executive
and the Company in good faith, based on then-effective final and proposed
Treasury regulations, and published rulings; provided further, that an
independent qualified national accounting firm selected by mutual agreement of
the parties shall provide conclusive calculations in the event the parties
cannot jointly agree.

 

10. Notice. For purposes of this Agreement, notices and all other communications
provided for in the Agreement shall be in writing and shall be deemed to have
been duly given when delivered by United States registered or certified mail,
return receipt requested, postage prepaid and addressed, in the case of the
Company, to the address set forth on the first page of this Agreement or, in the
case of the undersigned Executive, to the address set forth below his signature,
provided that all notices to the Company shall be directed to the attention of
the Chief Executive Officer of the Company, with a copy to the Secretary of the
Company, or to such other address as either party may have furnished to the
other in writing in accordance herewith, except that notice of change of address
shall be effective only upon receipt.

 

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SEVERANCE AGREEMENT

FOR VICE PRESIDENTS AND SENIOR VICE PRESIDENTS,

AND EXECUTIVE VICE PRESIDENTS WITH LESS THAN THREE YEARS

IN AN OFFICER POSITION

 

11. Validity. The invalidity or unenforceability of any provision of this
Agreement shall not affect the validity or enforceability of any other provision
of this Agreement, which shall remain in full force and effect.

 

12. Entire Agreement. This Agreement contains the entire agreement of the
parties and supersedes any and all other agreements, either oral or in writing
between the parties hereto with respect to the subject matter hereof and
contains all of the covenants and agreements between the parties with respect to
such subject matter.

 

13. Miscellaneous. No provision of this Agreement may be modified, waived or
discharged unless such waiver, modifications or discharge is agreed to in
writing signed by the Executive and the Chief Executive Officer of the Company.
No waiver or any breach of any term or provision of this Agreement shall be
construed to be, nor shall be, a waiver of any other breach of this Agreement.
No waiver shall be binding unless in writing signed by the party waiving the
breach. Unless otherwise noted, references to “Sections” are to sections of this
Agreement. The captions used in this Agreement are designed for convenient
reference only and are not to be used for the purpose of interpreting any
provision of this Agreement.

 

14. Enforceability. Notwithstanding any other provision of this Agreement, to
the extent that any payment to be made pursuant to this Agreement is prohibited
by applicable federal or state law or regulation, or by any action of any
federal or state regulatory agencies, unless the Company has obtained prior
approval for such otherwise prohibited payment from the appropriate regulatory
authority, the Company shall not be obligated to make such payments under this
Agreement. No other employee shall be entitled to severance benefits under the
plan described in Section 15, and of which this Agreement is a part, unless such
employee has been promised such severance benefits under a separate written
agreement.

 

15. Agreement Part of ERISA Plan. This Agreement is made pursuant to a
Company-sponsored severance plan covering selected Company Vice Presidents,
Senior Vice Presidents, and Executive Vice Presidents with less than 3 years of
service. All of the terms of the plan that relate to the Executive are contained
in this Agreement. Although the plan (including the Agreement) is generally
subject to the provisions of the Employee Retirement Income Security Act of 1974
(“ERISA”), the eligible employees constitute a select group of management or
highly compensated employees. Accordingly, the plan is exempt from the reporting
and disclosure provisions of ERISA pursuant to ERISA Regulation 2520.104-24. In
the event of a dispute, the claims procedures set forth in Section 16 shall
apply unless both parties agree to settle the dispute through arbitration. The
Company may amend or terminate the plan of which this Agreement is a part;
provided, however, that the plan may not be amended or terminated unilaterally
by the Company if such amendment or termination would result in some or all
benefits not being paid as the terms of the Agreement provide as of the
effective date set forth below.

 

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SEVERANCE AGREEMENT

FOR VICE PRESIDENTS AND SENIOR VICE PRESIDENTS,

AND EXECUTIVE VICE PRESIDENTS WITH LESS THAN THREE YEARS

IN AN OFFICER POSITION

 

16. Claims Procedure. If the Executive believes that severance benefits are not
being paid as this Agreement provides, he must file a claim with the Company’s
Vice President, Human Resources. The parties shall attempt to resolve the matter
during the 30-day period beginning on the date such claim is filed. Only after
the 30-day period has expired may an action in court be filed.

IN WITNESS WHEREOF, the parties hereto have caused this agreement to be duly
executed as of the date set forth below.

 

UNIFIED WESTERN GROCERS, INC. Agreed to this 8 day of December, 2006. By:  

/s/ Alfred A. Plamann

  Alfred A. Plamann, President & Chief Executive Officer
“The Executive” Agreed to this 8 day of December, 2006. By:  

/s/ Randall G. Scoville

  Randall G. Scoville, Vice President Executive’s Address:
                                                             

 

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