Mr. John C. Rocker
September 14, 1998
Page 5


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

                           September 14, 1998



Mr. John C. Rocker
c/o Homeland Stores, Inc.
P.O. Box 25008
Oklahoma City, OK 73125

Dear John:

          This letter confirms the terms of your employment with Homeland 
Stores, Inc. (the "Company").

          1.   Duties.  You will serve as the Vice President of Operations of
the Company commencing on September 14, 1998. You will devote all of your skill,
knowledge and full working time (reasonable vacation time and absence for
sickness or disability excepted) solely and exclusively to the conscientious 
performance of your duties hereunder. You will perform such duties and exercise
such powers, commensurate with your position, as the President and Chief
Executive Officer of the Company and the Board of Directors shall from time to
time delegate to you on such terms and conditions and subject to such 
restrictions as may reasonably be imposed from time to time.

          2.   Base Salary.  As compensation for the duties to be performed by
you under the terms of this letter agreement, the Company will pay you a base
salary in the amount of $125,000 per annum, payable at the same time as the 
Company pays salary to its other executive employees. The Company will review
your base salary from time to time and, at the discretion of the Board of 
Directors, may increase your base salary based upon your performance and other
relevant factors.

          3.   Incentive Bonus.  While you are providing services pursuant to
this letter agreement, you will be given the opportunity to receive an annual
bonus upon the attainment of such performance objectives as the Board of 
Directors shall determine from time to time after consulting with you. The 
target amount for your annual bonus will be 50% of your base salary based on 
the satisfaction of such performance objectives. Any bonus payable to you will
be paid to you at the same time as bonuses are paid to other executives. Any 
bonus payable for the 1998 fiscal year will be prorated for the partial year 
from the commencement of your employment through the end of the 1998 fiscal 
year.

          4.   Signing Bonus.  The Company will pay you a cash signing bonus 
in the aggregate amount of $25,333.00. The signing bonus will be payable 
$12,666.50 on the date you sign this letter agreement, and $12,666.50 on the 
date you and your family complete your relocation to the Oklahoma City area.

          5.   Relocation Matters.  The Company will reimburse you up to a 
maximum aggregate amount of $40,000 for direct moving expenses related to your
relocation to the Oklahoma City area, including the cost of moving all
household goods and automobiles to the Oklahoma City area. To the extent any 
payments made to you pursuant to this paragraph 5 are includable as compensation
income to you for income tax purposes and are not otherwise deductible, the
amount of such payments shall be increased by the amount of the tax so that you
will be "made whole" by such tax gross up to the maximum extent possible.

          6.   Stock Options.  Upon commencement of your employment hereunder,
you will be granted options to purchase 25,000 shares of common stock of 
Homeland Holding Corporation ("Holding") at an exercise price equal to the
fair market value for the common stock on September 14, 1998 ($4-3/4 per share).
The options will be granted pursuant to, and subject to the terms and conditions
of, a stock option agreement to be entered into between you and Holding.

          7.   Employee Benefits.  While you are providing services pursuant 
to this letter agreement, you will be eligible to participate in the employee
benefit plans and programs generally available to the Company's employees
(including, but not limited to, coverage under the Company's medical, dental,
life and disability insurance plans and participation in the Company's qualified
plans) as in effect from time to time on the same basis as the Company's other
employees, subject to the terms and provisions of such plans and programs.

          8.   Executive Perquisites.  You will be eligible to receive the 
perquisites and other personal benefits made available to the Company's senior
executives from time to time. You will be entitled to no less than three weeks 
paid vacation in each calendar year, which shall be taken at such times as are
consistent with your responsibilities hereunder. You will be eligible to receive
a car or a car allowance in accordance with the Company's car/car allowance
policy.

          9.   Expenses.  The Company will reimburse you for all reasonable 
expenses incurred by you in connection with your performance of services under
this letter agreement in accordance with the Company's policies, practices and 
procedures.

          10.  Termination of Employment.   The Company may terminate your 
employment at any time for any reason. If the Company terminates your employment
prior to December 31, 1999 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 five 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, (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, or (v) any act
of moral turpitude which has or may have an adverse effect on the Company, 
including, without limitation, commission of a felony or a misdemeanor involving
moral turpitude. 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.

          11.  Representation to the Company.  By signing below, you represent
to the Company that you are not restricted by or subject to any agreement or 
obligation that would be violated by your acceptance of this letter agreement
or the performance of your duties hereunder.

          12.  Binding Effect.  This letter agreement shall be binding upon and
inure to the benefit of your heirs and representatives and the successors and 
assigns of the Company, but neither this letter agreement nor any rights or
obligations hereunder shall be assignable or otherwise subject to hypothecation
by you (except by will or by operation of the laws of intestate succession) or
by the Company, except that the Company may assign this Agreement to any 
successor (whether by merger, purchase or otherwise) to all or substantially 
all of the stock, assets or businesses of the Company, if such successor 
expressly agrees to assume the obligations of the Company hereunder. If you 
should die while any amounts would still be payable to you under this letter 
agreement if you had continued to live, all such amounts, unless otherwise 
provided herein, will be paid in accordance with the terms of this letter
agreement to your personal or legal representatives, executors, administrators,
heirs, distributees, devisees, legatees or estate, as the case may be.

          13.  Indemnification.  The Company agrees to indemnify you to the 
fullest extent permitted under its By laws as in effect from time to time.

          14.  General Provisions.  No provisions of this letter agreement may 
be modified, waived or discharged unless such modification, waiver or discharge
is approved by the Company's Board of Directors and is agreed to in a writing
signed by you and such Company officer as may be specifically designated by the
Board.

          No agreements or representations, oral or other wise, express or 
implied, with respect to the subject matter hereof have been made by either 
party which are not set forth expressly in this letter agreement. The invalidity
or unenforceability of any one or more provisions of this letter agreement will
not affect the validity or enforce ability of any other provision of this letter
agreement, which will remain in full force and effect. This letter agreement 
may be executed in one or more counterparts, each of which will be deemed to 
be an original but all of which together will constitute one and the same 
instrument.

          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.

          The validity, interpretation, construction and performance of this 
letter agreement will be governed by the laws of the State of Oklahoma, without
giving effect to its conflict of laws provisions.

          If the foregoing accurately sets forth the terms of your employment
with the Company, 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 ___ day of September, 1998



John C. Rocker