VOLUME SERVICES AMERICA

                                                                      John T Dee
                                                                        Chairman
                                                         Chief Executive Officer

January 5, 2001

Ms. Janet L. Stemmayer
7 Nawthorne Road
Old Greenwich, Connecticut 06870

                        Re: Enhanced Severance Benefits
                            ---------------------------

Dear Ms. Steinmayer:

     As you know, the shareholders of Volume Services America Holdings, Inc. are
exploring  the  possible  sale of all or  substantially  all of the  business of
Holdings and its subsidiaries (the "Company") to a person or entity unaffiliated
with   Blackstone   Capital   Partners  II  Merchant   Banking  Fund  L.P.  (the
"Purchaser"),  by means of a  disposition  of stock,  assets or  otherwise  (the
"Disposition").

     It is not yet certain that any transaction will occur. However, the Company
recognizes that the uncertainties  surrounding this event may result in the loss
or  distraction  of a limited  number of key  employees,  including  you, to the
detriment of the Company.

     Therefore,  the Company has decided to enhance the  benefits  that you will
receive  under your  Employment  Agreement  dated as of September  29, 1998 (the
"Employment  Agreement"),  in the event that the  following two  conditions  are
satisfied:  (a) the  Disposition  closes on or before  December 31, 2001 and (b)
your employment  terminates in connection  with, or within the twelve (12) month
period  following,  the  closing of the  Disposition  because the Company or the
Purchaser terminates your employment for any reason other than Cause, as defined
in your Employment  Agreement,  permanent  disability or death, or you terminate
your employment for Good Reason,  as defined in your Employment  Agreement.  The
two  conditions  described in this  paragraph  are referred to as the  "Enhanced
Severance  Conditions."  (Please note that the  termination  of your  employment
under any other circumstances will be governed by your Employment Agreement.)

<PAGE>

Ms. Janet L. Steinmayer
January 5, 2001
Page 2

Enhanced Severance Benefits
---------------------------

     In the event the Enhanced Severance Conditions occur, you shall be entitled
to receive,  from the Company or, if applicable,  the Purchaser,  in lieu of any
and all other,  payments,  and benefits to which you would otherwise be entitled
upon termination,  under your Employment Agreement or otherwise,  the following:
(1) a lump sum payment equal to three times (3x) your compensation under Section
3 (a) of your  Employment  Agreement  over the one (1) year period  prior to the
date of termination  (annualized in the case of any termination prior to the end
of the first year),  less  withholdings  for taxes,  but up to a maximum payment
equal to two and  ninety-nine  one  hundredths  times  (2.99x)  your average W-2
compensation  for the five (5) calendar  years  preceding the  Disposition;  (2)
payment  for the  accrued  but  unused  part of your  vacation  in the  year the
termination  of your  employment  occurs;  (3)  notwithstanding  anything to the
contrary in any bonus plan,  payment for any accrued,  but unpaid,  bonus at the
time of  termination  or a  pro-rated  amount  of your  bonus in the  event  the
termination  occurs prior to the end of the Company's fiscal year, but in either
case payable at the end of the second month following the end of the fiscal year
to which the bonus applies;  (4)  reimbursement of expenses incurred through the
date  of  termination;  and (5)  your  present  Company  automobile  (and  title
thereto),   free  and  clear  of  any  lease  or  other  obligations;   and  (6)
reimbursement  for the  Company  subsidy  portion  of your  payments  for  COBRA
coverage, if you elect such coverage, until you obtain comparable coverage under
another employer's insurance plan, but no longer than eighteen (18) months.

     Payment of these Enhanced Severance Benefits shall be conditioned upon your
execution  of a full  release  of all  claims  against  the  Company  and/or the
Purchaser  (other  than  claims  with  respect  to vested  retirement  benefits,
deferred compensation, stock options and limited partnership interests and other
than with respect to workers  compensation  claims) in a form  acceptable to the
Company or, if applicable, the Purchaser.

     This  correspondence  contains the entire agreement  concerning its subject
matter and replaces any other  compensation plan, promise or arrangement you may
have or may be eligible for  concerning  its subject matter except that it shall
only amend and replace your Employment  Agreement to the extent of enhancing the
severance available under the Enhanced Severance Conditions as described herein.
Your Employment Agreement shall otherwise remain in full force and effect. These
Enhanced  Severance  Benefits shall expire if the closing of the  Disposition of
the Company has not occurred by December 31, 2001.

                                       Sincerely,

                                       VOLUME SERVICES AMERICA, INC.


                                       /s/ John T. Dee
                                       John T. Dee
                                       Chairman and Chief Executive Officer