EXHIBIT 10.37




                              EMPLOYMENT AGREEMENT



                  THIS EMPLOYMENT AGREEMENT (the "Agreement") is entered into as
of this 4th day of March, 1997 (the "Effective Date") by and between Farm Fresh,
Inc., a Virginia corporation (the "Company"), and Richard D.
Coleman (the "Executive").

                                   Background

                  The Company desires to employ Executive, and Executive is
willing to be employed by the Company, upon the terms and subject to the
conditions hereinafter set forth.

                  NOW, THEREFORE, in consideration of the mutual covenants set
forth herein, and intending to be legally bound hereby, the parties agree as
follows:

                                      Terms


                  SECTION 1. Employment. The Company hereby employs Executive,
and Executive hereby accepts such employment and agrees to serve as the
Company's Chief Financial Officer and Executive Vice President, Administration
(the "CFO") during the Employment Period set forth in Section 6, subject to the
terms and conditions hereinafter set forth.


                  SECTION 2. Management Duties. As CFO of the Company during the
Employment Period, Executive shall carry out such duties as are commensurate and
normally associated with the position of Chief Financial Officer, which duties
shall however, in all cases, be subject to policies set by, and at the direction
and control of, the Company's Board of Directors.

                  SECTION 3. Extent of Services. During the Employment Period,
Executive shall devote substantially all his working time (during normal
business hours) and attention (other than during any illness and vacations) and
give his best efforts, skills and abilities to the management and operations of
the Company; it being understood and agreed that Executive shall be permitted to
manage his own personal affairs and serve as a director or officer of any trade
association, civic, corporate, educational or charitable organization or
governmental entity, provided that Executive's service does not materially
interfere with Executive's performance of his duties hereunder. Executive shall
perform his services hereunder only at the Company's Norfolk, Virginia offices
and (with the consent of the Executive) at such other places as are required for
the effective management of the Company (other than business travel).

                  SECTION 4.  Compensation and Benefits.

                  (a) Executive shall receive, during the Employment Period,
from the Company as compensation for his services a salary at the annual rate of
Two Hundred Thousand Dollars ($200,000) per annum (the "Base Salary"). The Base
Salary shall be payable in equal installments at such intervals as the Company
pays its employees generally (but in no event less frequently than once per
month).

                  (b) Subject to Section 4(c), the Executive shall be eligible
to participate in an annual cash bonus program which shall contain financial
performance formulas and criteria to be agreed upon by the Company and the
Executive and pursuant to which the Company and the Executive intend for
Executive to be eligible to earn an amount equal to $100,000 upon satisfaction
of the specified financial performance formulas and criteria (the "Operations
Bonus Program"). The amount of each of the annual cash bonuses to which
Executive is entitled under the Operations Bonus Program shall be determined and
the bonus shall be paid to Executive as soon as the underlying financial data is
available (but in no event later than 90 days following the end of the year for
which the bonus is calculated).

                  (c) The Company, from time to time, may consider engaging in
one or more transactions involving the sale of the Company and/or all or a
portion of its assets, businesses and operations (including, without limitation,
as a merger, consolidation, sale of all or substantially all of the capital
stock of the Company or sale of all or a portion of the Company's assets)
pursuant to (x) a plan of reorganization which has been confirmed under chapter
11 of title 11 of the United State Code and for which an effective date
thereunder has occurred (an "Effective POR"), or (y) a full and complete
consensual settlement or other restructuring to which the Company and all of the
Company's holders of indebtedness for borrowed money are a party, or (z) an
acquisition agreement between the Company and any acquiror which, in the opinion
of the Company's Board of Directors, contains indemnification of third parties
which is substantially similar (from the perspective of third parties) to the
releases that are customarily available to third parties under an Effective POR
(any such transaction following any one of the conditions described in clause
(x) or (y) or (z), a "Transaction"). In the event that the aggregate Net Value
(as defined below) of the consideration received in connection with any
Transaction(s) during the Employment Period equals or exceeds $225,000,000 in
the aggregate, the Executive shall be entitled to receive from the Company a
cash bonus (a "Transaction Bonus") equal to $300,000 plus 0.4% of the positive
difference (if any) between the Net Value of the Transaction(s) and
$225,000,000. As used herein, "Net Value" shall mean the sum of: (i) in the case
of any asset sale, the sum of the cash and fair market value of all securities
and other non-cash property received by the Company in any Transaction,
increased dollar-for-dollar by any indebtedness for borrowed money assumed by
the purchaser, and reduced dollar-for-dollar by any liabilities (other than
indebtedness for borrowed money) which are properly allocated to the business
sold in the Transaction but which are retained or paid by the Company; and (ii)
in the case of any Transaction other than an asset sale, the sum of the cash and
fair market value of all securities and other non-cash property received by
securityholders of the Company, reduced dollar-for-dollar by (x) any proceeds
from any other Transactions held or to be received by the Company and/or its
securityholders and (y) any liabilities (other than indebtedness for borrowed
money) which are properly allocated to the business sold in the Transaction but
which are retained or paid by such securityholders, and increased
dollar-for-dollar by the aggregate amount of then-existing indebtedness for
borrowed money (after giving effect to any actual or contemplated debt
forgiveness or other similar compromise of such indebtedness in connection with
such Transaction)(all of the foregoing "Net Value" as reasonably determined by
the Company's Board of Directors or any nationally-recognized investment banking
firm designated by the Company). The amount of any Transaction Bonus to which
Executive is entitled under this Section 4(c) shall be determined and the bonus
shall be paid to Executive as soon as practicable (but in no event later than 90
days following the occurrence of the latest Transaction for which a payment is
owed under this Section 4(c)). Notwithstanding anything to the contrary
contained in this Agreement: (i) aggregate Transaction Bonus payments owed under
this Section 4(c) shall not exceed $400,000 in the aggregate; and (ii) in the
event that any Transaction Bonus is owed with respect to Transactions occurring
during any calendar year in which a payment is otherwise owed pursuant to
Section 4(b) under the Operations Bonus Program, the Executive only shall
receive the Transaction Bonus with respect to such calendar year and no bonus
shall be due or owing to the Executive under the Operations Bonus Program with
respect to such calendar year; and (iii) if any payments (including Transaction
Bonus payments) which the Executive has the right to receive from the Company or
any affiliated entities under this Agreement would otherwise constitute an
"excess parachute payment" (as defined in Internal Revenue Code Section 280G,
but determined without regard to Section 280G(b)(5)(A)(ii)), such payments shall
be reduced (the "Parachute Reduction") pro rata (but not below zero) to the
largest amount that will result in no portion of any such payment being subject
to the excise tax imposed by Internal Revenue Code Section 4999. The
determination of any reduction shall be determined by the Company in good faith
before any payments are due and payable to the Executive. If "Shareholder
Approval" (as defined in the next sentence) is obtained, the Parachute Reduction
shall not apply. Shareholder approval means approval of the elimination of the
Parachute Reduction by persons who own, immediately before a Transaction, more
than 75 percent of the voting power of the Company's outstanding stock by a vote
which satisfies the requirements of Internal Revenue Code section 280G(b)(5)(B)
and the applicable proposed, temporary or final Treasury Regulations thereunder.

                  (d) During the Employment Period, Executive and his eligible
dependents shall be entitled to participate in the employee benefit plans and
programs generally offered to any other senior executive officers of the Company
during the Employment Period.

                  (e) All payments to Executive or his estate made pursuant to
this Agreement shall be subject to such withholding as may be required by any
applicable laws.

                  SECTION 5. Expense Reimbursements; Automobile Allowance.
During the Employment Period, the Company shall reimburse Executive for all
reasonable or necessary out-of-pocket expenses incurred by Executive in the
performance of his duties hereunder, provided such expenses are submitted to the
Company in accordance with its accounting procedures.

                  SECTION 6. Term. The period of Executive's employment under
this Agreement (the "Employment Period") shall commence as of the date hereof
and, unless sooner terminated pursuant to Section 7 of this Agreement or
extended pursuant to the proviso to this sentence, shall continue until the
close of business on the second anniversary of the date of this Agreement, and
shall terminate at such time; provided however, that the Employment Period shall
be extended for an additional one-year period on the second anniversary of the
date of this Agreement and on each anniversary thereafter, unless either the
Company or the Executive shall have given written notice to the other, no later
than 180 days prior to the last day of the then-existing Employment Period, that
the term of this Agreement shall not be so extended.

                  SECTION 7.  Termination and Severance.

                  (a) Notwithstanding anything to the contrary contained herein,
the Employment Period shall terminate upon the earliest to occur of the
following (which may occur at any time as provided below and none of which are
deemed to be breaches of any covenants or agreements under this Agreement):

                           (i)      the close of business on the last day of the
then-existing Employment Period (as such Employment Period may be extended from
time to time pursuant to Section 6) where either the Company or the Executive
has elected not to extend the Employment Period in accordance with the proviso
contained in Section 6;

                           (ii)  the Executive's death;

                          (iii)  delivery by the Company to Executive of a
written notice of the Company's election to terminate Executive's employment
hereunder because of Executive's Disability (as defined below);

                           (iv)  delivery by the Company to Executive of a
written notice of the Company's election to terminate Executive's employment
hereunder for Cause (as defined below);

                            (v)  the close of business which is 90 days after
the date on which Executive delivered to the Company a written notice of
Executive's election to terminate Executive's employment hereunder and such
termination is not for Good Reason (as defined below);


                           (vi)  delivery by the Company to Executive of a
written notice of the Company's election to terminate Executive's employment
hereunder and such termination is not for Cause or as a result of Executive's
death or Disability; or

                           (vii) delivery by Executive to the Company of a
written notice of Executive's election to terminate Executive's employment
hereunder following a Value Transaction (as defined below) and such termination
is for Good Reason; or

                           (viii) the earlier to occur, as applicable, of (x)
one day following any one or more Transactions resulting in either a sale of all
or substantially all of the assets or capital stock of the Company (whether by
merger or otherwise), and (y) any effective date of any plan of reorganization
of the Company under chapter 11 of title 11 of the United States Code (the
earlier of the foregoing, a "Value Transaction").

                  (b) For purposes of this Agreement, "Disability" shall mean
that Executive suffers from a permanent physical or mental impairment which, in
the judgment of an independent medical physician, even with reasonable
accommodations prevents Executive from substantially performing his duties
hereunder for a period of one-hundred eighty (180) consecutive days. For the
purposes of this Agreement, the term "Cause" shall mean (i) the willful and
continuing failure by Executive substantially to perform his duties with the
Company (other than any such failure resulting from illness) under this
Agreement, provided that, solely with respect to any act or omission by
Executive which remains curable without significant out-of-pocket cost to the
Company, "Cause" shall not be deemed to exist under this clause (i) unless
Executive has been provided by the Company with at least thirty (30) days prior
written notice of the Company's intention to terminate Executive's employment
hereunder for Cause and Executive has not cured or corrected such performance
defaults within such thirty-day period, or (ii) the willful and continuing
failure by Executive to perform Executive's obligations under Section 9
hereunder, or (iii) the indictment of Executive for theft, embezzlement or other
felony crimes against the Company. For purposes of the foregoing definition of
"Cause," no act, or failure to act, shall be considered "willful" unless done,
or omitted to be done, in bad faith and without reasonable belief that the
action or omission was in the best interest of the Company. Notwithstanding the
foregoing or any other provision hereof, Executive shall not be deemed to have
been terminated for Cause unless there shall have been delivered to Executive a
copy of a resolution duly adopted by the affirmative vote of not less than a
majority of the entire membership of the Board of Directors of the Company at a
meeting of the Board of Directors of the Company called and held for such
purpose (after reasonable notice to Executive and an opportunity for the
Executive, together with his counsel, to be heard before the Board), finding
that, in the reasonable and good faith opinion of the Board of Directors of the
Company, Executive was guilty of conduct set forth above and specifying the
particulars thereof in reasonable detail. For purposes of this Agreement, "Good
Reason" shall mean (i) the willful and continuing failure by the Company
substantially to perform its obligations under this Agreement; provided that,
solely with respect to any act or omission by the Company which remains curable
without significant out-of-pocket cost to the Executive, "Good Reason" shall not
be deemed to exist under this clause (i) unless the Company has been provided by
the Executive with at least thirty (30) days prior written notice of the
Executive's intention to terminate Executive's employment hereunder for Good
Reason and the Company has not cured or corrected such performance defaults
within such thirty-day period, or (ii) any material alteration or diminution in
Executive's responsibilities to the Company as its chief financial officer under
this Agreement (other than changes required by applicable federal or state
laws), or (iii) the Executive's compensation or employment related benefits
(other than with respect to any bonus) are in the aggregate reduced in any
material respect, or (iv) the Executive's place of employment is moved to a
location more than 20 miles from the current Norfolk location without the
Executive's consent.


                  (c) Following any termination of Executive's employment
hereunder, all obligations of the Company under this Agreement (other than (x)
any obligations with respect to the payment of accrued and unpaid salary,
accrued and unpaid bonus, accrued and unpaid vacation, and expense reimbursement
under Section 5 hereof through the date of Executive's termination of employment
hereunder, and (y) as set forth in Section 7(d)) shall terminate.

                  (d) In the event of any termination of Executive's employment
hereunder pursuant to Section 7(a)(vi) or Section 7(a)(vii), the Company shall
pay to Executive severance compensation in an amount equal to 100% of
Executive's Base Salary. All cash severance compensation amounts owed pursuant
to this Section 7(d) shall be paid within thirty (30) days following the
effective date of Executive's termination.

                  (e) Except for benefits under the Company's qualified benefit
plans, any severance compensation granted in Section 7 of this Agreement shall
be the sole and exclusive compensation or benefit due to Executive upon
termination of Executive's employment.

                  SECTION 8.  Representations, Warranties and Acknowledgments of
                  Executive.

                  (a) Executive represents and warrants that he is not a party
to or otherwise subject to or bound by the terms of any contract, agreement or
understanding (including without limitation any contract, agreement or
understanding containing terms and provisions similar in any manner to those
contained in Section 9 hereof) which in any manner would limit or otherwise
affect his ability to perform his obligations hereunder. Executive further
represents and warrants that his employment with the Company will not require
him to disclose or use any confidential information belonging to prior employers
or other persons or entities.

                  (b) Executive represents and warrants that he acknowledges the
Company's belief that it would cause the Company serious and irreparable injury
and cost if Executive were to breach the obligations contained in Section 9.

                  (c) Executive recognizes and acknowledges that: (i) in the
course of Executive's employment by the Company it will be necessary for
Executive to acquire information which could include, in whole or in part,
information concerning the Company's experimental and development plans, trade
secrets, secret procedures, information relating to ideas, improvements, and
inventions, disclosures, processes, systems, formulas, composition, patents,
patent applications, machinery, materials research activities and plans,
customers or vendors and prospective customers, the Company's product costs, the
Company's prices, profits and volume of sales, and future business plans, and
other confidential or proprietary information belonging to the Company or
relating to the Company's affairs, even if such information has been disclosed
in confidence to one or more third parties pursuant to distribution agreements,
joint research agreements or other agreements entered into by the Company or any
of its affiliates and which information is not generally available within the
public domain (collectively, such information is referred to herein as the
"Confidential Information"); (ii) the Confidential Information is the property
of the Company; (iii) the use, misappropriation or disclosure of the
Confidential Information would cause irreparable injury to the Company; and (iv)
it is essential to the protection of the Company's good will and to the
maintenance of the Company's competitive position that the Confidential
Information be kept secret and that Executive not disclose the Confidential
Information to others (except as may be necessary for the performance of
Executive's duties hereunder).

                  SECTION 9.  Executive's Covenants and Agreements.

                  (a) Executive agrees that he shall not, without the prior
written consent of the Board of Directors of the Company, disclose or make
available to anyone for use outside the Company's organization at any time,
either during his employment with the Company or subsequent to the termination
of his employment with the Company for any reason, any Confidential Information,
whether or not developed by Executive, except as required in the performance of
Executive's duties to the Company or as is otherwise required by law, applicable
regulation or any recognized subpoena power. Notwithstanding anything to the
contrary contained herein, the foregoing confidentiality obligations of the
Executive shall not apply to any information or data that is generally available
within the public domain or otherwise publicly accessible through legal means
(in no event, in any case, as a result of Executive's breach of his obligations
hereunder).

                  (b) Upon the termination of Executive's employment with the
Company for any reason, Executive promptly shall deliver to the Company all
correspondence, drawings, blueprints, manuals, letters, notes, notebooks,
reports, flow-charts, programs, proposals, price lists, customer lists, company
credit cards, company vehicles and any documents concerning the Company's
customers or concerning products or processes used by the Company containing or
constituting Confidential Information.

                  (c) Executive covenants and agrees that during the period of
Executive's employment hereunder and, if applicable, during the Non-Compete
Period, Executive shall not, directly or indirectly (whether as principal,
agent, officer, director, employee, consultant, shareholder, or otherwise,
whether alone or in association with any other person, corporation or other
entity): (i) engage in, own or otherwise operate any supermarket or retail
grocery business in the Commonwealth of Virginia; or (ii) solicit or induce, or
attempt to solicit or induce, any employee of the Company to leave; it being
understood that Executive shall be permitted to own up to 3% of the outstanding
capital stock of any publicly-traded company listed on a national securities
exchange or quoted on the National Association of Securities Dealers Automated
Quotations System. For purposes of this Agreement, "Non-Compete Period" means
the one-year period following any termination of Executive's employment by
Executive pursuant to Sections 7(a)(iv) or 7(a)(v).

                  SECTION 10. Remedies. Executive acknowledges that his promised
services hereunder are of a special, unique, unusual, extraordinary and
intellectual character, which give them peculiar value the loss of which cannot
be reasonably or adequately compensated in an action of law, and that, in the
event there is a breach hereof by Executive, the Company will suffer irreparable
harm, the amount of which will be impossible to ascertain. Accordingly, the
Company shall be entitled, if it so elects, to institute and prosecute
proceedings in any court of competent jurisdiction, either at law or in equity,
to obtain damages for any breach or to enforce specific performance of the
provisions or to enjoin Executive from committing any act in breach of this
Agreement. The remedies granted to the Company in this Agreement are cumulative
and are in addition to remedies otherwise available to the Company at law or in
equity.

                  SECTION 11. Waiver of Breach. The waiver by the Company or
Executive of a breach of any provision of this Agreement by the other party (the
"Breaching Party") shall not operate or be construed as a waiver of any other or
subsequent breach by the Breaching Party of such or any other provision. No
delay or omission by the Company or Executive in exercising any right, remedy or
power hereunder or existing at law or in equity shall be construed as a waiver
thereof, and any such right, remedy or power may be exercised by the Company or
Executive from time to time and as often as may be deemed expedient or necessary
by the Company or Executive in its or his sole discretion.

                  SECTION 12. Notices. All notices required or permitted
hereunder shall be made in writing by hand-delivery, certified or registered
first-class mail, or air courier guaranteeing overnight delivery to the other
party at the following addresses:

                  To the Company:

                  Farm Fresh, Inc.
                  7530 Tidewater Drive
                  Norfolk, Virginia  23505
                  Attention: Board of Directors


                  with a copy to:

                  Dechert Price & Rhoads
                  4000 Bell Atlantic Tower
                  1717 Arch Street
                  Philadelphia, PA 19103
                  Attention: David E. Schulman, Esq.

                  To Executive:

                  Richard D. Coleman





or to such other address as either of such parties may designate in a written
notice served upon the other party in the manner provided herein. All notices
required or permitted hereunder shall be deemed duly given and received when
delivered by hand, if personally delivered; on the third day next succeeding the
date of mailing if sent by certified or registered first-class mail; and on the
next business day, if timely delivered to an air courier guaranteeing overnight
delivery.

                  SECTION 13. Severability. If any term or provision of this
Agreement or the application thereof to any person or circumstance shall, to any
extent, be held invalid or unenforceable by a court of competent jurisdiction,
the remainder of this Agreement or the application of any such term or provision
to persons or circumstances other than those as to which it is held invalid or
unenforceable, shall not be affected thereby, and each term and provision of
this Agreement shall be valid and enforceable to the fullest extent permitted by
law. If any of the provisions contained in this Agreement shall for any reason
be held to be excessively broad as to duration, scope, activity or subject, it
shall be construed by limiting and reducing it, so as to be valid and
enforceable to the extent compatible with the applicable law or the
determination by a court of competent jurisdiction.

                  SECTION 14. Governing Law. The implementation and
interpretation of this Agreement shall be governed by and enforced in accordance
with the laws of the Commonwealth of Virginia without giving effect to the
conflicts of law provisions thereof.

                  SECTION 15. Binding Effect and Assignability. The rights and
obligations of both parties under this Agreement shall inure to the benefit of
and shall be binding upon their heirs, successors and assigns. Neither party's
rights under this Agreement shall, in any voluntary or involuntary manner, be
assignable and may not be pledged or hypothecated without the prior written
consent of the other party; it being understood that no merger or consolidation
involving the Company shall be deemed an assignment.

                  SECTION 16. Attorneys' Fees; Costs. In any action or
proceeding for damages or injunctive relief, the prevailing party, in addition
to other relief, shall be entitled to reasonable attorneys' fees, costs and the
expenses of litigation incurred by such party in securing the relief granted by
the court.

                  SECTION 17. Counterparts; Section Headings. This Agreement may
be executed in any number of counterparts, each of which shall be deemed to be
an original, but all of which together shall constitute one and the same
instrument. The section headings of this Agreement are for convenience of
reference only.

                  SECTION 18. Survival. Notwithstanding the termination of this
Agreement or Executive's employment hereunder for any reason, Sections 7, 8, 9,
10, 14, 16 and 18 hereof (and any other provisions that explicitly contemplate
extending beyond the termination of this Agreement or the Employment Period)
shall survive any such termination.

                  SECTION 19. Entire Agreement. This instrument constitutes the
entire agreement with respect to the subject matter hereof between the parties
hereto and replaces and supersedes as of the date hereof any and all prior oral
or written agreements and understandings between the parties hereto. This
Agreement only may be modified by an agreement in writing executed by both
Executive and the Company.

                  SECTION 20.  Representations.  The Company represents that it
is authorized and empowered to enter into this contract, and no contracts or
indentures will be breached thereby.

                  SECTION 21. Arbitration. Subject to the terms and conditions
of this Agreement, any dispute, controversy or claim arising from or relating to
this Agreement (other than for injunctive relief) which the parties to this
Agreement are unable to resolve, shall be resolved only by arbitration, which
may be commenced at any time by notice given by any party to this Agreement.
Arbitration shall be conducted pursuant to the Commercial Arbitration Rules of
the American Arbitration Association ("AAA") then in effect. There shall be
three arbitrators selected as follows: (i) one arbitrator shall be selected by
the Company, one arbitrator shall be selected by the Executive, and the third
arbitrator shall be selected jointly by the first two arbitrators, except that
if the parties to this Agreement fail to select an arbitrator within sixty (60)
days after initiation of arbitration or if the first two arbitrators fail to
select the third arbitrator within one hundred twenty (120) days after
initiation of arbitration, then the AAA shall make such selection. The venue of
the arbitration shall be New York City, New York. Expenses of the arbitration
proceeding shall be borne by the parties to this Agreement in such amounts or
proportions as the arbitrators may determine. The decision of the arbitrators
shall be by majority vote and shall be delivered in writing. Any arbitral award
shall be final and binding on the parties to this Agreement and judgment upon
any arbitral award may be entered and enforced by any court or judicial
authority of competent jurisdiction.

                  IN WITNESS WHEREOF, the undersigned have executed this
Agreement the date and year first written above.

                                    Company:

                                    FARM FRESH, INC.


                                    By      /s/ FARM FRESH, INC.
                                        ------------------------------
                                    Executive:


                                           /s/ Richard D. Coleman
                                         --------------------------------
                                          Richard D. Coleman