Exhibit 10(s)

                                                             EXECUTION COPY


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                          STOCK PURCHASE AGREEMENT

                                by and among

                         STAR MARKETS COMPANY, INC.,

                        STAR MARKETS HOLDINGS, INC.,

          Certain Other Stockholders of Star Markets Holdings, Inc.
                    Listed on the Signature Pages Hereto



                                     and



                               J SAINSBURY PLC



                           As of November 25, 1998


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                              TABLE OF CONTENTS

                                                                       Page

                                  ARTICLE I
                                 DEFINITIONS
                                 -----------

Definitions                                                              1

                                 ARTICLE II
                      PURCHASE AND REDEMPTION OF SHARES
                      ---------------------------------

2.1.   Purchase and Sale of the Shares                                   6
2.2.   Holdings Stock Options                                            
2.3.   Share Redemption                                                  
2.4.   Closing Date                                                      

                 ARTICLE III  REPRESENTATIONS AND WARRANTIES
                         OF HOLDINGS AND THE COMPANY
                 -------------------------------------------

3.1.   Corporate Organization                                            8
3.2.   Capital Stock                                                     
3.3.   Subsidiaries                                                     
3.4.   Corporate Authority                                              
3.5.   Financial Statements                                             
3.6.   Operations Since January 31, 1998                                
3.7.   No Undisclosed Liabilities                                       
3.8.   Taxes                                                            
3.9.   Governmental Permits                                             
3.10.  Real Property                                                    
3.11.  Real Property Leases                                             
3.12.  Intellectual Property                                            
3.13.  Labor Relations                                                  
3.14.  Employee Benefit Plans                                           
3.15.  Contracts                                                        
3.16.  No Violation, Litigation or Regulatory Action                    
3.17.  Insurance                                                        
3.18.  Certain Transactions or Arrangements                             
3.19.  Finders                                                          

                                 ARTICLE IV
                REPRESENTATIONS AND WARRANTIES OF THE SELLERS
                ---------------------------------------------

4.1.   Authority and Related Matters                                    
4.2.   No Finder                                                        

                                  ARTICLE V
                 REPRESENTATIONS AND WARRANTIES OF PURCHASER
                 -------------------------------------------

5.1.   Organization of Purchaser                                        
5.2.   Authority of Purchaser                                           
5.3.   No Finder                                                        
5.4.   Investment Intent                                                
5.5.   Status as Accredited Investor                                    
5.6.   Financial Capability                                             
5.7.   Governmental Consents                                            

                                 ARTICLE VI
                            ADDITIONAL COVENANTS
                            --------------------

6.1.   Investigation of Holdings and the Company by Purchaser           
6.2.   Confidentiality                                                  
6.3.   Certain Agreements                                               
6.4.   Operations Prior to the Closing Date                             
6.5.   No Public Announcement                                           
6.6.   Governmental Filings; Consents                                   
6.7.   Directors' and Officers' Indemnification                         
6.8.   Employee Benefits                                                
6.9.   Acquisition Proposals                                            
6.10.  Notices and Consents                                             
6.11.  Balance Sheet                                                    
6.12.  Termination of Agreements                                        
6.13.  Information Technology                                           

                                 ARTICLE VII
              CONDITIONS PRECEDENT TO OBLIGATIONS OF PURCHASER
              ------------------------------------------------

7.1.   No Misrepresentation or Breach of Covenants and Warranties       
7.2.   Resignations of Directors                                        
7.3.   Litigation                                                       
7.4.   Governmental Approvals                                           
7.5.   FIRPTA Affidavit                                                 
7.6.   Transaction Expenses                                             

                                ARTICLE VIII
              CONDITIONS PRECEDENT TO OBLIGATIONS OF HOLDINGS,
                         THE COMPANY AND THE SELLERS
              ------------------------------------------------

8.1.   No Misrepresentation or Breach of Covenants and Warranties       
8.2.   Litigation                                                       
8.3.   Governmental Approvals                                           

                                 ARTICLE IX
                                 TERMINATION
                                 -----------

9.1.   Termination                                                      
9.2.   Effect of Termination                                            
9.3.   No Liability Upon Termination                                    

                                  ARTICLE X
                             GENERAL PROVISIONS
                             ------------------

10.1.  Non-survival of Representations, Warranties and Agreements       
10.2.  Notices                                                          
10.3.  Partial Invalidity                                               
10.4.  Execution in Counterparts                                        
10.5.  Governing Law                                                    
10.6.  Assignment; Successors and Assigns                               
10.7.  Titles and Headings                                              
10.8.  Schedules and Exhibits                                           
10.9.  Knowledge                                                        
10.10. Entire Agreement; Amendments                                     
10.11. Waivers                                                          
10.12. Waiver of Jury Trial                                             
10.13. Expenses                                                         


                            Exhibit and Schedules

Exhibit A                 Sellers
Schedule 3.2(b)           Capital Stock -- Star Markets Holdings, Inc.
Schedule 3.4              Corporate Authority
Schedule 3.5              Financial Statements
Schedule 3.5(b)           Holdings Liabilities
Schedule 3.6              Operations Since January 1, 1998
Schedule 3.8              Taxes
Schedule 3.10             Owned Real Property
Schedule 3.11             Scheduled Leases
Schedule 3.12             Intellectual Property
Schedule 3.14             Employee Benefits
Schedule 3.15             Contracts
Schedule 3.16             No Violation, Litigation or Regulatory Action
Schedule 3.17             Insurance
Schedule 3.18             Transactions With Affiliates
Schedule 6.4(b)(viii)     Long Range Growth Plan
Schedule 10.9             Persons Having Knowledge


                          STOCK PURCHASE AGREEMENT

      This STOCK PURCHASE AGREEMENT is dated as of November 25, 1998, by and 
among those Persons listed on Exhibit A hereto (each individually, a "Seller", 
collectively, the "Sellers"), Star Markets Company, Inc., a Massachusetts 
corporation (the "Company"), Star Markets Holdings, Inc., a Massachusetts 
corporation ("Holdings") and J Sainsbury plc, a company organized under the laws
of England and Wales (the "Purchaser").

                             W I T N E S S E T H
                             - - - - - - - - - -

      WHEREAS, Holdings will, immediately prior to the Closing Date, be the 
owner of 100% of the issued and outstanding capital stock of the Company; 

      WHEREAS, the Sellers are the owners of that number of shares of Class D 
Stock of Holdings, par value of $.01 per share, set forth next to each such 
Seller's name on Exhibit A attached hereto;

      WHEREAS, pursuant to the Certificate of Designations of Holdings as filed 
with the Secretary of State of the Commonwealth of Massachusetts (the 
"Certificate of Designations"), holders of Class A Stock and Class C Stock of 
Holdings are entitled to participate in any proposed sale of Class D Stock by 
holders thereof; and

      WHEREAS, the Sellers desire to sell to Purchaser that number of shares of 
Class D Stock identified next to each such Seller's name on Exhibit A attached 
hereto and Purchaser (i) desires to purchase for the amounts provided herein, 
and on the terms and subject to the conditions set forth in this Agreement, the 
Class D Stock offered for sale hereby as well as those shares of Class A Stock 
and Class C Stock for which holders thereof make a valid tag-along election 
pursuant to the terms hereof and of the Certificate of Designations, and (ii) 
has agreed to provide the funds necessary for Holdings to redeem those shares of
Class A Stock and Class C Stock that are not offered for sale to Purchaser 
pursuant to Section 2.1 herein below.

      NOW, THEREFORE, in consideration of the mutual terms, conditions and other
covenants and agreements set forth herein, the parties hereto hereby agree as 
follows:

                                  ARTICLE I

                                 DEFINITIONS

      In addition to the other words and terms defined elsewhere in the 
Agreement, as used in this Agreement, the following words and terms have the 
meanings specified or referred to below:

      "Acquisition Proposal" has the meaning specified in Section 6.9.

      "Additional Shares" has the meaning specified in Section 2.1(b).

      "Affiliate" means, with respect to any Person, any other Person who, 
directly or indirectly, controls, is controlled by or is under common control 
with such Person.

      "Aggregate Option Exercise Price" means an amount equal to the aggregate 
dollar amount of the exercise price of all Holdings Options outstanding 
immediately prior to the Closing.

      "Aggregate Purchase Price" means an amount equal to (i) the Buyer Purchase
Price, plus (ii) the Aggregate Option Exercise Price, plus (iii) $68,475, less 
(iv) the amount, if any, by which Transaction Expenses exceed $6,000,000, plus 
(v) interest on the Buyer Purchase Price at a per annum rate of 10% from April 
1, 1999 until the Closing Date.

      "Buyer Purchase Price" means $220,800,000.

      "Certificate of Designations" has the meaning specified in the recitals to
this Agreement.

      "Class A Stock" has the meaning specified in Section 3.2(b).

      "Class C Stock" has the meaning specified in Section 3.2(b).

      "Class D Sellers" shall mean all of the holders of Class D Stock.

      "Class D Stock" has the meaning specified in Section 3.2(b).

      "Closing" has the meaning specified in Section 2.4.

      "Closing Date" has the meaning specified in Section 2.4.

      "Code" means the Internal Revenue Code of 1986, as amended.

      "Common Stock" has the meaning specified in Section 3.2(b).

      "Company" has the meaning specified in the preamble to this Agreement.

      "Company Common Stock" has the meaning specified in Section 3.2(a).

      "Company Financial Statements" has the meaning specified in Section 
3.5(d).

      "Company Group" has the meaning specified in Section 3.14(a).

      "Cumulative Preferred Stock" has the meaning specified in Section 3.2(a).

      "Defined Benefit Plan" has the meaning specified in Section 3.14(a).

      "DOL" has the meaning specified in Section 3.14(b)(4).

      "Electing Stockholders" has the meaning specified in Section 2.1(b).

      "Employee Benefit Plan" has the meaning specified in Section 3.14(a).

      "Employee Plan" has the meaning specified in Section 3.14(a).

      "Encumbrance" means any lien, claim, charge, security, interest, mortgage,
pledge or encumbrance, including, with respect to real estate and interests 
therein, easements, rights of way, covenants, conditions, restrictions or other 
adverse rights.

      "Environmental Laws" means the Comprehensive Environmental Response, 
Compensation and Liability Act of 1980, 42 U.S.C. [SECTION] 9601 et seq., the 
Resource Conservation and Recovery Act, 42 U.S.C. [SECTION]6901, the Federal 
Water Pollution Control Act, 33 U.S.C. [SECTION] 1201, the Clean Water Act, 33 
U.S.C. [SECTION]1321, the Clean Air Act, 42 U.S.C. [SECTION] 7401 and the Toxic 
Substances Control Act, 15 U.S.C. [SECTION] 2601, the Massachusetts Oil and 
Hazardous Material Release, Prevention and Response Act (MGL Ch. 21E) and any 
other Laws, in each case, as amended from time to time, dealing with the 
protection of human health, natural resources and/or the environment including, 
without limitation, Laws relating to (i) the discharge, storage, handling, 
transportation or disposal of any Hazardous Substance, (ii) the release or 
threatened release of Hazardous Substances, and (iii) the discharge of 
pollutants or effluents into the water or air or any emissions which would 
require a permit.

      "ERISA" means the Employee Retirement Income Security Act of 1974, as 
amended.

      "Financial Statements" means the Company Financial Statements and the 
Holdings Balance Sheet.

      "Fully Diluted Number" means (i) the aggregate number of outstanding 
Shares (excluding treasury shares) plus (ii) the aggregate number of Shares 
issuable upon exercise of all outstanding Holdings Options as of the Closing 
Date plus (iii) 913.

      "Governmental Body" means any federal, state, local or foreign court, 
government, department, commission, board, bureau, agency, official or other 
regulatory, administrative or governmental authority.

      "Governmental Permits" has the meaning specified in Section 3.9(a).

      "Hazardous Substance" means any substance in any concentration that is 
listed, classified or regulated pursuant to any Environmental Law including, 
without limitation, petroleum products, asbestos, lead products and 
polychlorinated biphenyls.

      "Holdings" has the meaning specified in the preamble for this Agreement.

      "Holdings Balance Sheet" has the meaning specified in Section 3.5(a).

      "Holdings Option Plan" has the meaning specified in Section 3.2(b).

      "Holdings Option" has the meaning specified in Section 3.2(b).

      "H-S-R Act" means the Hart-Scott-Rodino Antitrust Improvements Act of 
1976, as amended, and the rules and regulations promulgated thereunder.

      "Indemnified Liabilities" has the meaning specified in Section 6.7(b).

      "Indemnified Parties" has the meaning specified in Section 6.7(b).

      "Intellectual Property" has the meaning specified in Section 3.12(a).

      "IRS" means the Internal Revenue Service.

      "Laws" means any foreign, federal, state or local law, ordinance, code, 
regulation, rule, order, arbitration award, judgment, ruling or decree and 
applicable common law.

      "Massachusetts Attorney General" has the meaning specified in Section 5.7.

      "Material Adverse Effect" means (i) with respect to Holdings or the 
Company, a material adverse effect on or change in the business, assets, 
condition (financial or otherwise), or results of operations of Holdings and the
Company taken as a whole; and (ii) with respect to the Purchaser, a material 
adverse effect on or change in the business, assets, condition (financial or 
otherwise), or results of operations of the Purchaser and its Subsidiaries taken
as a whole.

      "Multiemployer Plan" has the meaning specified in Section 3.14(a).

      "Owned Real Property" has the meaning specified in Section 3.10.

      "PBGC" means the Pension Benefit Guaranty Corporation established pursuant
to Subtitle A of Title IV of ERISA, or any other governmental agency, department
or instrumentality succeeding to the functions of said Corporation.

      "Permitted Encumbrance" means (i) only with respect to real estate and 
interests therein, easements, covenants, conditions, restrictions and other 
matters of record, and incidental mechanics' and other similar liens, none of 
which, individually or in the aggregate, has had or would result in a material 
adverse effect on the value of the property subject thereto or the ability to 
use such property as it is presently used and (ii) the Encumbrances arising from
the Senior Credit Agreement.

      "Permitted Investments" has the meaning specified in Section 2.3(c).

      "Per Share Amount" has the meaning specified in Section 2.1(c).

      "Person" means and includes an individual, a partnership, a corporation, a
trust, a joint venture, an unincorporated organization and any governmental or 
regulatory body or other agency or authority.

      "Preferred Stock" has the meaning specified in Section 3.2(a).

      "Purchaser" has the meaning specified in the first paragraph of this 
Agreement.

      "Purchaser Contribution" has the meaning specified in Section 2.3(a).

      "Redeemed Shares" has the meaning specified in Section 2.3(a).

      "Redemption Agent" has the meaning specified in Section 2.3(a).

      "Redemption Fund" has the meaning specified in Section 2.3(a).

      "Redemption Price" has the meaning specified in Section 2.3(a).

      "Returns" has the meaning specified in Section 3.8(a).

      "Scheduled Leases" has the meaning specified in Section 3.11(a).

      "SEC" has the meaning specified in Section 3.5(d).

      "SEC Filings" has the meaning specified in Section 3.5(d).

      "Securities Act" means the Securities Act of 1933, as amended.

      "Sellers" means the Class D Sellers as well as, from and after 
identification thereof to Purchaser pursuant to the terms hereof, the Electing 
Stockholders.  

      "Senior Credit Agreement" means the Credit Agreement dated as of September
8, 1994 by and among the Company, The Chase Manhattan Bank (formerly Chemical 
Bank) as Administrative Agent and the lenders party thereto, as amended from 
time to time.

      "Shares" means shares of Class A, Class C or Class D Stock, as applicable.

      "Subsidiary" shall mean, as of the applicable point in time, each 
corporation, partnership, joint venture or other entity, other than the Company,
of which Holdings owns, directly or indirectly, more than 50% of the outstanding
voting securities or equity interests.

      "Tax" or "Taxes" has the meaning specified in Section 3.8(a).

      "Transaction Expenses" means the legal, accounting, financial advisory and
consulting expenses incurred by Holdings and the Company in connection with the 
transactions contemplated hereby.

      "Treasury Regulations" has the meaning specified in Section 3.8(e)(i).

      "USRPHC" has the meaning specified in Section 3.8(e)(i).


                                 ARTICLE II

                      PURCHASE AND REDEMPTION OF SHARES

      2.1.  Purchase and Sale of the Shares

      (a)  Subject to the terms and conditions hereof, on the Closing Date, the 
Sellers shall sell to the Purchaser, and the Purchaser shall purchase from each 
Seller the number of Shares of Class D Stock specified next to each such 
Seller's name on Exhibit A hereto, representing, in the aggregate, 100% of the 
voting capital stock of Holdings.

      (b)  Not less than 10 days prior to the Closing, Holdings shall notify 
Purchaser of those holders of Class A Stock and Class C Stock who have made 
valid elections to participate in the sale of Shares to Purchaser pursuant to 
the terms of the Certificate of Designations (such persons, the "Electing 
Stockholders"), the number of shares of such Class A Stock and Class C Stock 
(collectively, the "Additional Shares") with respect to which each such Electing
Stockholder has validly exercised such right and the Per Share Amount.  In order
to make a valid election to participate in the sale of Shares pursuant to this 
Agreement, each Electing Stockholder shall agree, in form reasonably 
satisfactory to and for the benefit of Purchaser, to be bound by the terms, 
conditions and other provisions of this Agreement as if a signatory hereto as of
the date hereof and to waive any and all rights to the contrary under applicable
Law or the Certificate of Designations.  Subject to the terms and conditions 
hereof and the Certificate of Designations, on the Closing Date, Purchaser shall
purchase from the Electing Stockholders, and the Electing Stockholders shall 
sell to the Purchaser, each Additional Share for the Per Share Amount as set 
forth in Section 2.1(c).

      (c)  The purchase price to be paid to any Seller or Electing Stockholder 
for each Share to be sold pursuant to Section 2.1 shall be (1) the Aggregate 
Purchase Price divided by (2) the Fully Diluted Number, rounded to the nearest 
$0.01 (the "Per Share Amount").  At Closing, the Per Share Amount is payable in 
cash in immediately available funds for each Share against delivery of stock 
certificates representing such Shares, in proper form for transfer together with
any necessary documentary or transfer tax stamps duly affixed and canceled and 
otherwise in form reasonably satisfactory to Purchaser.  Payment shall be made 
by wire transfer to accounts designated by each Seller and Electing Shareholder 
by notice to Purchaser at least two business days prior to Closing.

      2.2.  Holdings Stock.  Subject to the terms and conditions hereof, on the 
Closing Date or as soon as practicable thereafter, Holdings shall pay each 
holder of Holdings Options who surrenders such Holdings Options for cancellation
(in consideration of such cancellation), for each Share covered by such Holdings
Options, a cash amount equal to (1) the Per Share Amount less (2) the applicable
exercise price of such Holdings Option and (3) any withholding taxes required by
applicable law.  On and after the Closing Date, Purchaser shall provide to 
Holdings all cash funds necessary to make such payments on a timely basis.  
Prior to Closing, Holdings and the Company shall use all reasonable efforts to 
take such actions as may be necessary to effectuate the foregoing, including 
without limitation, obtaining all applicable consents.  The cancellation of a 
Holdings Option in accordance with the foregoing shall be deemed a release of 
any and all rights the holder of such Holdings Option had or may have had in 
respect of such Holdings Option and any required consents received from holders 
of Holdings Options shall so provide.

      2.3.  Share Redemption.  

      (a)  Subject to the terms and conditions hereof and the Certificate of 
Designations, on or before the Closing Date, Purchaser shall deposit in trust 
(the "Redemption Fund") on behalf of Holdings by wire transfer of immediately 
available funds (the "Purchaser Contribution") with Chase Manhattan Bank, N.A. 
(the "Redemption Agent") as are required to redeem, concurrently with the 
consummation of the stock purchases contemplated by Section 2.1, those shares of
Class A Stock and Class C Stock that do not constitute Additional Shares for 
purposes of this Agreement (the "Redeemed Shares").  The price to be paid for 
each such share (the "Redemption Price") shall be the Per Share Amount less, in 
accordance with Section 5 of the Certificate of Designations, the pro rata 
share, based on the number of Shares so redeemed from such holder, of such 
holder of Redeemed Shares of the expenses of the purchase and sale of Shares 
pursuant to this Agreement to be borne by the Sellers, if any, including, 
without limitation, legal, accounting and investment banking fees and expenses 
to be borne by the Sellers, if any.  Purchaser and Holdings shall cause the 
Redemption Agent to give notice of such redemption at least two business days 
prior to the Closing and, on and after the Closing Date, pay the Redemption 
Price per Redeemed Share to each holder of Redeemed Shares provided for in this 
Section 2.3 out of the Redemption Fund promptly after the surrender to the 
Redemption Agent by such holder of stock certificates representing such Redeemed
Shares for cancellation.  If for any reason (including losses) the Redemption 
Fund is inadequate to pay the amounts required under this Section 2.3, Purchaser
shall in any event be liable for payment thereof.  In accordance with Section 5 
of the Certificate of Designations, all certificates representing Redeemed 
Shares, including all certificates not delivered or surrendered to the 
Redemption Agent for cancellation shall be deemed to be canceled by Holdings as 
of the Closing Date and shall thereafter no longer represent any equity interest
in or other rights with respect to Holdings other than the right to receive the 
Redemption Price per Redeemed Share upon surrender to the Redemption Agent for 
cancellation.

      (b)  Contemporaneously with the completion of such redemptions, in 
consideration of the funding provided for in Section 2.3(a), Holdings shall 
issue to Purchaser that number of shares of Common Stock representing the total 
number of shares of Class A Stock and Class C Stock so redeemed.

      (c)  The Redemption Agent shall invest undistributed portions of the 
Redemption Fund as Purchaser directs in obligations of or guaranteed by the 
United States of America, in commercial paper obligations receiving an 
investment grade rating from both Moody's Investor Services, Inc. and Standard &
Poor's Corporation, or in certificates of deposit, bank repurchase agreements or
banker's acceptances of commercial banks with capital exceeding $1,000,000,000 
(collectively, "Permitted Investments"); provided, however, that the maturities 
of Permitted Investments shall be such as to permit the Redemption Agent to make
prompt payment to holders of Class A Stock and Class C Stock entitled thereto as
contemplated by this Section.  The Redemption Fund shall not be used for any 
purpose except as expressly provided in this Agreement.  Any cash, cash 
equivalents or Permitted Investments remaining in the Redemption Fund following 
the earlier of (i) the payment of the Redemption Price per Share to each holder 
of Redeemed Shares in respect of such holder's Redeemed Shares and (ii) the 
sixtieth day following the Closing Date shall be delivered to Purchaser or its 
designee by the Redemption Agent.  Thereafter, the Redemption Agent's duties 
shall terminate and each holder of Redeemed Shares may surrender to Holdings the
stock certificates representing such holder's Redeemed Shares (and subject to 
applicable abandoned property, escheat and similar laws), receive the Redemption
Price per Redeemed Share in exchange therefor.  Neither the Redemption Agent nor
Holdings shall be liable to a holder of Redeemed Shares for any amounts 
delivered to a public official pursuant to applicable abandoned property, 
escheat or similar laws.  In no event shall Purchaser, Holdings or the 
Redemption Agent be required to pay interest on any amount payable to any 
Seller, Electing Stockholder or holder of Redeemed Shares pursuant to this 
Article II.

      2.4.  Closing Date.  Subject to the terms and conditions hereof, the 
consummation of the transactions provided for in this Article II (the "Closing")
shall take place as soon as practicable but in no event later than the third 
business day after the date on which each of the conditions set forth in 
Articles VII and VIII have been satisfied or waived by the party or parties 
entitled to the benefit of such conditions, or at such other place, at such 
other time or on such other date as Purchaser, the Sellers and Holdings may 
mutually agree.  The date on which the Closing actually occurs is hereinafter 
referred to as the "Closing Date."  The Closing shall take place at the offices 
of Gibson, Dunn & Crutcher LLP, 200 Park Avenue, New York, New York 10166.


                                 ARTICLE III

                       REPRESENTATIONS AND WARRANTIES 
                         OF HOLDINGS AND THE COMPANY
                       ------------------------------

      As an inducement to Purchaser to enter into this Agreement and to 
consummate the transactions contemplated hereby, Holdings and the Company 
represent and warrant to Purchaser as follows:

      3.1.  Corporate Organization.  Each of Holdings and the Company is a 
corporation duly organized, legally existing and in good standing under the laws
of the Commonwealth of Massachusetts.  The Company is duly qualified to transact
business as a foreign corporation and is in good standing in each other 
jurisdiction in which the ownership or leasing of its properties or assets or 
the conduct of its business requires such qualification (except where, 
individually or in the aggregate, the failures to so qualify have not had and 
would not be reasonably likely to result in a Material Adverse Effect).  
Holdings and the Company each have all requisite corporate power to own or lease
and to operate and use their properties and assets and to carry on their 
businesses as now conducted.  Each of Holdings and the Company has delivered or 
made available to Purchaser complete and correct copies of its articles of 
organization, and bylaws, each as in effect on the date hereof.

      3.2.  Capital Stock.  

      (a)  The authorized capital stock of the Company consists of (i) 10,000 
shares of common stock, par value $.01 per share (the "Company Common Stock") 
and (ii) 10,000 shares of preferred stock, par value $.01 per share (the 
"Preferred Stock"), of which 5,000 have been designated as Cumulative Preferred 
Stock (the "Cumulative Preferred Stock").  The only outstanding shares of 
capital stock of the Company are 5,000 shares of Company Common Stock and 5,000 
shares of Cumulative Preferred Stock all of which are owned by Holdings.  None 
of the issued and outstanding shares of capital stock issued by the Company has 
been issued in violation of, or is subject to, any preemptive or any 
subscription rights.  Except as disclosed on Schedule 3.2(a), there are no 
agreements, arrangements, warrants, options, puts, calls, rights or other 
employee benefit plans or other commitments or understandings of any character 
to which Holdings or the Company is a party relating to the issuance, sale, 
purchase, redemption, conversion, exchange, registration, voting or transfer of 
any shares of Company Common Stock, Preferred Stock or other securities of the 
Company.  All of the outstanding shares of Company Common Stock and Preferred 
Stock are duly and validly issued and fully paid and nonassessable, free of any 
preemptive or subscription rights.

      (b)  As of the date hereof, the authorized capital stock of Holdings 
consists of (i) 1,555,000 shares of common stock, par value $.01 per share (the 
"Common Stock"), (ii) 1,045,000 shares of Class A stock, par value $.01 per 
share (the "Class A Stock"), (iii) 505,000 shares of Class C stock, par value 
$.01 per share (the "Class C Stock"), and (iv) 5,000 shares of Class D stock, 
par value $.01 per share (the "Class D Stock").  As of the date hereof, 
1,015,603 Class A Shares are currently outstanding, 137,143 Class C Shares are 
currently outstanding, 5,000 Class D Shares are currently outstanding, and no 
Common Shares are currently outstanding.  As of the date hereof, options to 
purchase 172,418 shares of Class C Stock (each a "Holdings Option") were 
outstanding pursuant to stock option agreements entered into between Holdings 
and certain of the Company's management and key employees pursuant to the 1994 
Stock Incentive Plan of Holdings and the Amended and Restated Stock Incentive 
Plan (collectively, the "Holdings Option Plan").  None of the issued and 
outstanding Shares have been issued in violation of, or are subject to, any 
preemptive or any subscription rights.  Except for this Agreement, the Holdings 
Option Plan and except as disclosed on Schedule 3.2(b), there are no agreements,
arrangements, warrants, puts, calls, rights, options or other employee benefit 
plans or other commitments or understandings of any character to which Holdings 
is a party relating to the issuance, sale, purchase, redemption, conversion, 
exchange, registration, voting or transfer of any Shares or other securities of 
Holdings.  The names of the record holders of all such warrants, options, puts, 
calls and rights, the number and class of shares of Holdings capital stock 
issuable upon exercise of all such warrants, options, puts, calls and rights, 
and the exercise price per share of Holdings  capital stock of all such 
warrants, options, puts, calls and rights, are set forth on Schedule 3.2(b).  
All of the shares of Class C Stock subject to issuance pursuant to the Holdings 
Option Plan upon exercise of the Holdings Options shall, upon issuance on the 
terms and conditions specified in the instruments pursuant to which the Shares 
are issuable, be duly authorized, validly issued, fully paid and nonassessable.
All of the outstanding Shares are duly and validly issued and fully paid and 
nonassessable, free of any preemptive or subscription rights (except as set 
forth in Schedule 3.2(b)), and upon delivery to Purchaser pursuant to Article II
hereof the Shares will be duly and validly issued and fully paid and 
nonassessable, free of any preemptive or subscription rights and free and clear 
of all Encumbrances, other than those contained in the Certificate of 
Designations.  Assuming all Holdings Options are canceled pursuant to Section 
2.2 hereof, upon the Closing, including the redemption of the Redeemed Shares, 
there will be no shares of capital stock of Holdings outstanding other than the 
Shares purchased by or issued to Purchaser pursuant to this Agreement and the 
Certificate of Designations and there will not be any agreements, arrangements, 
warrants, puts, calls, rights, options or employee benefit plans or other 
commitments or understandings of any character to which Holdings is a party or 
by which Holdings is bound relating to the issuance, sale, purchase, redemption,
conversion or exchange of any capital stock of Holdings or any other securities 
exercisable, convertible or exchangeable for capital stock of Holdings.

      3.3.  Subsidiaries.  Holdings has no Subsidiaries other than the Company.
The Company has no Subsidiaries.

      3.4.  Corporate Authority.

      (a)  Each of Holdings and the Company has all requisite corporate power to
execute and deliver this Agreement, to consummate the transactions, subject to 
the conditions set forth herein, contemplated hereby and to comply with the 
terms, conditions and provisions hereof.  The execution, delivery and 
performance of this Agreement by Holdings and the Company have been duly 
authorized by all requisite corporate action.  This Agreement has been duly 
executed and delivered by each of Holdings and the Company and constitutes, and 
each other instrument contemplated hereby, when executed and delivered by 
Holdings or the Company, as appropriate, will constitute the valid and binding 
obligation of Holdings or the Company, as the case may be, enforceable in 
accordance with its terms.

      (b)  Except as set forth in Schedule 3.4, neither the execution and 
delivery by Holdings, the Company or any security holder thereof of this 
Agreement or of any of the other instruments contemplated hereby, nor the 
consummation by Holdings, the Company or any security holder thereof of any of 
the transactions contemplated hereby, nor compliance by Holdings, the Company or
any security holder thereof with or fulfillment thereby of the terms, conditions
and provisions hereof will:

            (i)  conflict with or violate any provision of Holdings' or the 
      Company's articles of organization or bylaws;

            (ii)  result in the acceleration of, or entitle any party to 
      accelerate (whether after the giving of notice or lapse of time or 
      both), any debt obligation of Holdings or the Company in excess of 
      $1,000,000 in the aggregate;

            (iii)  conflict with or violate, or result with giving of 
      notice or lapse of time or both in any conflict with or violation of, 
      or result in the creation or imposition of, any Encumbrance upon any 
      of the assets or properties of Holdings or the Company pursuant to 
      any provision of, any mortgage, lien, lease, agreement, Governmental 
      Permit, item of Intellectual Property, indenture, license, instrument 
      or Law to which Holdings or the Company is a party or by which any of 
      them or any of their properties or assets is bound, other than 
      conflicts, violations, creations and impositions that would not 
      result in new or additional monetary liability to Holdings or the 
      Company in excess of $1,000,000 in the aggregate;

            (iv)  constitute an event permitting modification, amendment or 
      termination of a mortgage, lien, lease, agreement, Governmental 
      Permit, item of Intellectual Property, indenture, license, 
      instrument, order, arbitration award, judgment or decree to which 
      Holdings or the Company is a party or by which any of them or any of 
      their assets or properties is bound, other than modification(s), 
      amendment(s) or termination(s) that would not result in new or 
      additional monetary liability to Holdings or the Company in excess of 
      $1,000,000 in the aggregate; or

            (v)  require the approval, consent, authorization or act of, or 
      the making by Holdings or the Company, of any declaration, filing or 
      registration with any Governmental Body or other Person, except for 
      such federal and state securities laws requirements as will be 
      satisfied prior to the Closing Date, and except to the extent that 
      the failure to obtain or make any of the foregoing, individually or 
      in the aggregate, would not result in a Material Adverse Effect.

      3.5.  Financial Statements.

      (a)  Schedule 3.5 contains a true and complete copy of the balance sheet 
of Holdings as of January 31, 1998.  The balance sheet referred to in the 
preceding sentence is herein referred to as the "Holdings Balance Sheet".  The 
Holdings Balance Sheet presents fairly the financial condition and results of 
operations of Holdings as of such date; such balance sheet and the notes thereto
disclose all liabilities, direct or contingent, of Holdings as of the date 
thereof required to be disclosed by generally accepted accounting principles; 
and such balance sheet was prepared in accordance with generally accepted 
accounting principles applied on a consistent basis except as specified in the 
notes thereto.

      (b)  Except as described in Schedule 3.5(b), the assets of Holdings 
consist solely of the capital stock of the Company and Holdings has no 
liabilities (direct or contingent) in excess of $100,000 in the aggregate.

      (c)  As of September 26, 1998, indebtedness for borrowed money of Holdings
and the Company on a consolidated basis did not exceed $270,000,000.

      (d)  Since February 1, 1998, the Company has filed all forms, reports and 
documents with the Securities and Exchange Commission (the "SEC") required to be
filed by it pursuant to the federal securities laws and the rules and 
regulations promulgated thereunder, and all such forms, reports and documents 
filed with the SEC have complied in all material respects with all applicable 
requirements of the federal securities laws and the rules and regulations 
promulgated thereunder.  The Company has, prior to the date hereof, delivered or
made available to Purchaser true and complete copies of all forms, reports, 
registration statements and other filings filed by the Company with the SEC 
since February 1, 1998 (such forms, reports, registration statements and other 
filings, together with any exhibits and any amendments thereto and any 
information incorporated by reference therein, collectively, the "SEC Filings").
As of their respective dates, the SEC Filings did not contain any untrue 
statement of a material fact or omit to state a material fact required to be 
stated therein or necessary to make the statements therein, in light of the 
circumstances under which they were made, not misleading.  Each of the balance 
sheets, statements of operations, statements of equity and statements of cash 
flow included in the SEC Filings on or prior to the date hereof (the "Company 
Financial Statements") were prepared in accordance with generally accepted 
accounting principles applied on a consistent basis and fairly present, in all 
material respects, the financial position of the Company as of the dates thereof
and the results of operations and changes in cash flows for the periods then 
ended.  The Company shall deliver to Purchaser as soon as they become available 
true and complete copies of any form, report, registration statement or other 
document mailed by it to its securityholders or filed by it with the SEC 
subsequent to the date hereof.  As of their respective dates, such forms, 
reports, registration statements and other documents filed with the SEC will not
contain any untrue statement of material facts or omit to state material facts 
required to be stated therein or necessary to make the statements therein, in 
light of the circumstances under which they are made, not misleading.  Each of 
the balance sheets, statements of operations, statements of equity and 
statements of cash flow included in such SEC Filings after the date hereof will 
be prepared in accordance with generally accepted accounting principles applied 
on a consistent basis and fairly present, in all material respects, the 
financial position of the Company as of the dates thereof and the results of 
operations and changes in cash flows for the periods then ended (subject in the 
case of any unaudited interim financial statements to normal year-end 
adjustments).

      3.6.  Operations Since January 31, 1998.

      (a)  Except as set forth in the Financial Statements and except for 
changes resulting from general industry and economic conditions and changes that
may result from the announcement of the transactions contemplated by this 
Agreement, since January 31, 1998 there have been no events that, individually 
or in the aggregate, have had or are reasonably likely to have a Material 
Adverse Effect.

      (b)  Except as described in Schedule 3.6 and except for the transactions 
permitted by this Agreement, since January 31, 1998 each of Holdings and the 
Company has conducted its business in the ordinary course and in conformity with
past practice and, without limiting the foregoing:

            (i)  Holdings and the Company have not amended their articles 
      of organization or bylaws and have not made any capital expenditures 
      or commitments except in a manner not materially inconsistent with 
      the Company's 1998 capital plan previously provided to the Purchaser;

            (ii)  there has been no declaration, setting aside or payment 
      of any dividend or other distribution in respect of the capital stock 
      of Holdings or the Company, other than dividends on the Cumulative 
      Preferred Stock paid in accordance with the terms thereof and no 
      issuance of any capital stock of Holdings or the Company or of any 
      securities convertible into or exchangeable or exercisable for, or 
      otherwise representing any right to acquire, any such capital stock 
      other than issuances of Class C Stock in connection with the exercise 
      of Holdings Options;

            (iii)  neither Holdings nor the Company has redeemed, 
      repurchased, or otherwise acquired any of its capital stock or 
      securities convertible into or exchangeable or exercisable for its 
      capital stock or any other securities of Holdings or the Company, nor 
      entered into any agreement, arrangement or other commitment to do so 
      other than the acquisition from former employees of the Company or 
      Holdings of shares of Class C Stock upon such employees' termination 
      of employment and agreements providing for such acquisitions;

            (iv)  neither Holdings nor the Company has adopted or amended 
      any bonus, profit sharing, compensation, stock option, pension, 
      retirement, deferred compensation or other plan, agreement, trust 
      fund or arrangement or other plan for the benefit of its employees 
      other than any such adoptions or amendments as were in the ordinary 
      course of business consistent with past practices and which do not 
      have a Material Adverse Effect;

            (v)  neither Holdings nor the Company has granted or agreed to 
      grant any bonus or other special compensation or increased 
      compensation or benefits payable or to become payable to any 
      directors, officers or employees of the Company or Holdings except 
      for increases, bonuses or special compensation payable to 
      nonexecutive officers and employees in the ordinary course of 
      business consistent with past compensation practice, or taken any 
      action with respect to the grant or increase of severance or 
      termination pay or entered into any employment, consulting or similar 
      agreement;

            (vi)  neither Holdings nor the Company has incurred any 
      indebtedness for money borrowed except under the Senior Credit 
      Agreement;

            (vii)  neither Holdings nor the Company has been the subject of 
     any change in accounting methods, principles or practice, except 
     insofar as may have been required by a change in generally accepted 
     accounting principles;

            (viii)  there has been no damage, destruction, condemnation or 
      similar loss to tangible assets or property which, individually or in 
      the aggregate, have had or are reasonably likely to have a Material 
      Adverse Effect;

            (ix)  neither Holdings nor the Company has altered in any 
      material respect its practices and policies relating to the payment 
      and collection, as the case may be, of accounts payable and accounts 
      receivable;

            (x)  neither Holdings nor the Company has created, assumed or 
      suffered to be incurred any Encumbrance of any kind on any of its 
      properties or assets other than (A) Encumbrances in the ordinary 
      course of business consistent with past practices and (B) Permitted 
      Encumbrances; 

            (xi)  neither Holdings nor the Company has settled or 
      compromised any claims, actions, proceedings or litigation involving 
      material liability for money damages or placing any materially 
      burdensome restrictions on the operations of the Company's 
      businesses; or waived, released or assigned any material rights or 
      claims under any material contracts except in the ordinary course of 
      business consistent with past practices;

            (xii)  neither Holdings nor the Company has made any material 
      Tax election or made any material change in its insurance coverages; 
      or

            (xiii)  neither Holdings nor the Company has entered into any 
      agreement, arrangement or understanding, or otherwise resolved or 
      committed, to do any of the foregoing.

      (c)  As of the date hereof, to the actual knowledge of the Company, there 
has been no damage, destruction, condemnation or similar loss to tangible assets
or property which has resulted in a Material Adverse Effect or a material 
adverse effect on the value of any Owned Real Property or the real property 
subject to any Scheduled Lease or the ability to use any such real property as 
it is presently used.

      3.7.  No Undisclosed Liabilities.  Except as set forth on the Financial 
Statements, neither Holdings nor the Company is subject to any claims, 
obligations or liabilities of any nature (whether accrued, absolute, contingent,
inchoate or otherwise, including, without limitation, unasserted claims), other 
than (a) obligations pursuant to or in connection with this Agreement or the 
transactions contemplated hereby, (b) liabilities and obligations incurred in 
the ordinary course of business consistent with past practice after January 31, 
1998, and (c) liabilities which individually or in the aggregate, have not had 
and are not reasonably likely to have a Material Adverse Effect.

      3.8.  Taxes.

      (a)  Except as set forth on Schedule 3.8, Holdings and the Company have 
timely filed or caused to be timely filed all material federal, state, foreign 
and local, tax returns, tax information returns, reports, and estimates 
("Returns"), for all taxable or reporting periods ending on or before the 
Closing Date (taking into account applicable extension periods) to the extent 
required to be filed by Holdings and the Company under the applicable federal, 
foreign, state or local law, on or before the Closing Date; all Taxes due have 
been paid in full when due and adequate provision has been made on the Financial
Statements for all Taxes not yet due and payable; all Returns are true, complete
and accurate in all material respects; and there are no liens on any of the 
assets of Holdings or the Company that arose in connection with any failure (or 
alleged failure) to pay any Tax.  As used in this Agreement, "Taxes" or "Tax" 
means all foreign, federal, state or local taxes of any kind and any interest or
penalties related thereto, including, without limitation, net income, capital 
gains, gross receipts, franchise, employment, sales, use, license, property or 
withholding taxes validly imposed upon Holdings or the Company with respect to 
such taxes.

      (b)  Schedule 3.8:  (i) lists all material federal, state, local, and 
foreign Returns filed with respect to Holdings or the Company (or any former 
subsidiary of Holdings or the Company) for periods ended on or after January 1, 
1994 and (ii) indicates those Returns that have been audited and those Returns 
that currently are the subject of an audit.  Holdings and the Company have 
delivered or made available to Purchaser correct and complete copies of all 
Returns, examination reports and statements of deficiencies assessed against or 
agreed to by Holdings or the Company (or any former subsidiary of Holdings or 
the Company) since January 1, 1994.

      (c)  Except as set forth in Schedule 3.8:  (i) all deficiencies or 
assessments relating to Taxes have been paid in full; (ii) no waivers of 
statutes of limitation and no extensions of time have been given or requested 
with respect to any Taxes by Holdings or the Company; and (iii) no closing 
agreements, private letter rulings, technical advice memoranda or similar 
agreements or rulings have been entered into or issued by any taxing authority 
with respect to Sellers, Holdings or the Company.

      (d)  Holdings and the Company have each (i) withheld all material amounts 
required to be withheld from the wages of their respective employees (if any), 
with respect to tax withholding and taxes due from such employees under the 
Federal Insurance Contributions Act or any other foreign, federal, state, or 
local unemployment tax laws for payroll periods ending on or before the Closing 
Date, and (ii) filed all material foreign, federal, state or local returns and 
reports that were required by the applicable foreign, federal, state or local 
law to be filed on or before the Closing Date (taking into account applicable 
extension periods) with respect to such withholding for such periods.

      (e)   (i)  None of Holdings or the Company is a United States Real 
      Property Holding Corporation (a "USRPHC") within the meaning of 
      Section 897 of the Code nor was either Holdings or the Company a 
      USRPHC on any "determination date" (as defined in [SECTION]1.897-2(c) 
      of the regulations promulgated by the Treasury Department pursuant to 
      the Code (the "Treasury Regulations")) that occurred in the five-year 
      (or shorter applicable) period preceding the Closing Date.

            (ii)  No amounts are required to be withheld pursuant to 
      Section 1445 of the Code as a result of the transfer contemplated by 
      this Agreement.

      (f)  Neither Holdings nor the Company will be required, as a result of (A)
a change in accounting method for a Tax period ending on or before the Closing 
Date, to include any adjustment under Section 481(c) of the Code (or any similar
provision of state, local or foreign law) in taxable income for any Tax period 
ending after the Closing Date, or (B) any "closing agreement" as described in 
Section 7121 of the Code (or any similar provision of state, local or foreign 
Tax law), to include any item of income in or exclude any item of deduction from
any Tax period ending after the Closing Date.

      (g)  Neither Holdings nor the Company has ever been a member of an 
affiliated, combined, consolidated or unitary Tax group for purposes of filing 
any Return, other than a group of which Holdings was the common parent.

      3.9.  Governmental Permits.  

      (a)  Holdings and the Company own, hold or possess all governmental 
licenses, franchises, permits, privileges, immunities, approvals and other 
authorizations which are necessary for their ownership, leasing, operation and 
use of their respective assets and properties and which are required for their 
carrying on and conducting their respective businesses as currently conducted 
(herein collectively called "Governmental Permits"), except where the failure to
own, hold or possess the same, individually or in the aggregate, have not had 
and would not be reasonably likely to result in a Material Adverse Effect.  Each
Governmental Permit is valid, and in full force and effect and, to the knowledge
of Holdings and the Company, no suspension or cancellation of any of them is 
threatened, except for such suspensions or cancellations that, individually or 
in the aggregate, have not had and would not be reasonably likely to result in a
Material Adverse Effect.  No written notice of cancellation, of default or of 
any dispute concerning any Governmental Permit, or of any event, condition or 
state of facts which constitutes or, after notice or lapse of time or both, 
would constitute a breach or default under any Governmental Permit has been 
received by Holdings or the Company, except for those that, individually or in 
the aggregate, have not had and would not be reasonably likely to result in a 
Material Adverse Effect.  To the knowledge of Holdings and the Company, there 
are no pending or proposed changes in permit requirements that would require 
Holdings or the Company to make additional monetary payments in order to obtain,
renew or comply with any Governmental Permit, except for those that, 
individually or in the aggregate, have not had and would not be reasonably 
likely to result in a Material Adverse Effect.

      (b)  As of the date hereof, the Company does not have actual knowledge 
that:

            (i)  Holdings and the Company do not own, hold or possess all 
      required Governmental Permits, except where the failure to own, hold 
      or possess the same, individually or in the aggregate, have not had 
      and would not be reasonably likely to result in a material adverse 
      effect on the value of any Owned Real Property or the real property 
      subject to any Scheduled Lease or the ability to use any such real 
      property as it is presently used;

            (ii)  any such Governmental Permit is not valid or in full 
      force and effect and no suspension or cancellation of any such 
      Governmental Permit has been threatened, except for matters that, 
      individually or in the aggregate, have not had and would not be 
      reasonably likely to result in a material adverse effect on the value 
      of any Owned Real Property or the real property subject to any 
      Scheduled Lease or the ability to use any such real property as it is 
      presently used; and

            (iii)  any written notice of cancellation, of default or of any 
      dispute concerning any such Governmental Permit, or of any event, 
      condition or state of facts which constitutes or, after notice or 
      lapse of time or both, would constitute a breach or default under any 
      such Governmental Permit has been received by Holdings or the 
      Company, except for those that, individually or in the aggregate, 
      have not had and would not be reasonably likely to result in a 
      material adverse effect on the value of any Owned Real Property or 
      the real property subject to any Scheduled Lease or the ability to 
      use any such real property as it is presently used.

      3.10.  Real Property.  

      (a)  All real property of which Holdings or the Company is the record or 
beneficial owner is identified on Schedule 3.10 and is hereinafter referred to 
as the "Owned Real Property".  Except as stated in the policies of title 
insurance with respect to such properties (copies of which have been delivered 
to Purchaser) or as disclosed on Schedule 3.10, Holdings or the Company, as the 
case may be, holds good, marketable fee title to the Owned Real Property, free 
of all Encumbrances other than Permitted Encumbrances.  Neither Holdings nor the
Company has heretofore made any title claims or has outstanding any title claims
under any policy of title insurance respecting the Owned Real Property.  All 
improvements on the Owned Real Property conform to applicable zoning and other 
land use ordinances and building codes and are in compliance with all applicable
Laws except where the failure to conform or comply would not individually or in 
the aggregate have or be reasonably likely to have a Material Adverse Effect.

      (b)  As of the date hereof, the Company does not have actual knowledge 
that any improvements on the Owned Real Property do not conform in any respect 
to applicable zoning and other land use ordinances and building codes are not in
compliance with any applicable Laws except where the failure to conform or 
comply would not individually or in the aggregate have or would not be 
reasonably likely to result in a material adverse effect on the value of any 
Owned Real Property or the real property as it is presently used.  As of the 
date hereof, to the actual knowledge of the Company, there are neither any 
pending nor any threatened condemnation, eminent domain or similar proceeding 
with respect to any of the Owned Real Property that would materially affect the 
real property as it is presently used.

      3.11.  Real Property Leases. 

      (a)  The leases, subleases and related agreements and documents with 
respect to real property leased by the Company, including, without limitation, 
all retail grocery stores and warehouse and distribution facilities are 
identified on Schedule 3.11 (the "Scheduled Leases").  Correct and complete 
copies of the Scheduled Leases have been made available to the Purchaser and all
such Scheduled Leases are in full force and effect.  Holdings or the Company, as
the case may be, holds good and valid leasehold title to each of the properties 
which are the subject of the Scheduled Leases, in each case free of all 
Encumbrances, except for liens for (x) Taxes not yet due and payable or which 
are being contested in good faith, and (y) Permitted Encumbrances.  To the 
knowledge of Holdings and the Company, except as identified on Schedule 3.11, 
there are no existing defaults under any Scheduled Lease, and no event has 
occurred which with notice or lapse of time, or both, could constitute an event 
of default under any Scheduled Lease, which, individually or in the aggregate, 
would result in or be reasonably likely to result in a Material Adverse Effect.
The transactions contemplated by this Agreement will not result in a default 
under any Scheduled Lease (which, individually or in the aggregate, would have 
or be reasonably likely to have a Material Adverse Effect), except for Scheduled
Leases requiring consent of the Landlord to the transactions contemplated by 
this Agreement, each of which is identified on Schedule 3.11.

      (b)  As of the date hereof, except as identified on Schedule 3.11, neither
Holdings nor the Company has actual knowledge of any existing default under any 
Scheduled Lease, or that any event has occurred which with notice or lapse of 
time, or both, would constitute an event of default under any Scheduled Lease, 
which, individually or in the aggregate, would result in a material adverse 
affect on the value of any real property subject to any Scheduled Lease or the 
ability to use any such real property as it is presently used.  As of the date 
hereof, to the actual knowledge of the Company, there are neither any pending 
nor any threatened condemnation, eminent domain or similar proceeding with 
respect to any real property subject to any Scheduled Lease that would 
materially affect the real property as it is presently used.

      3.12.  Intellectual Property.  

      (a)  Schedule 3.12 contains a complete and correct list of all United 
States and foreign patents, patent applications, registered trademarks, 
trademark applications, registered service marks, service mark applications, 
trade names and registered copyrights which are material to the business of 
Holdings and the Company taken as a whole (the "Intellectual Property").

      (b)  Except as set forth in Schedule 3.12, the right, title or interest of
Holdings and the Company in each item of Intellectual Property is free and clear
of Encumbrances which would have a Material Adverse Effect.

      (c)  Except as set forth in Schedule 3.12, neither Holdings nor the 
Company has received written notice that is still pending to the effect that 
Holdings or the Company has infringed upon any patent, trademark, service mark, 
trade name, copyright, brand name, logo, symbol or other intellectual property 
right of any third party; nor is there any action pending or, to Holdings' and 
the Company's knowledge, threatened, against Holdings or the Company claiming 
that Holdings or the Company has, whether directly, contributory or by 
inducement, infringed any trade secret or misappropriated any other intellectual
property which infringement, notice, charge, claim, or assertion, as the case 
may be, would have a Material Adverse Effect.

      (d)  Except as set forth in Schedule 3.12, neither Holdings nor the 
Company has sent or otherwise communicated to another person any notice, charge,
claim or other assertion of, and neither Holdings nor the Company has any 
knowledge of, any present, impending or threatened patent, trademark or 
copyright infringement which infringement would have a Material Adverse Effect.

      3.13.  Labor Relations.  There are no pending labor grievances or unfair 
labor practice claims or charges against Holdings or the Company which would 
have a Material Adverse Effect.  To Holdings' and the Company's knowledge there 
are no organizing efforts by any union or other group seeking to represent any 
employees of Holdings or the Company.  There is not pending any decertification 
which would result in withdrawal liability to any Multiemployer Plan, except 
such efforts, petitions or decertifications which would not have a Material 
Adverse Effect.

      3.14.  Employee Benefit Plans.

      (a)  The term "Employee Plan" shall mean any pension, retirement, profit-
sharing, thrift, savings, deferred compensation, stock purchase, stock option, 
restricted stock, bonus or incentive plan, any medical, vision, dental or other 
health plan, any life insurance plan, vacation, severance, disability or any 
other employee benefit, welfare benefit or fringe benefit plan, program, policy,
or arrangement, whether written, unwritten, formal or informal (including, 
without limitation, any employment agreements and any "Employee Benefit Plan" as
defined in Section 3(3) of ERISA) covering any employees of Holdings or the 
Company or any other entity which, together with Holdings or the Company 
constitutes a single employer within the meaning of Section 414 of the Code  or 
Section 4001 of ERISA (hereinafter collectively referred to as the "Company 
Group") to which any member of the Company Group has any outstanding present or 
future obligations to make payments to or to contribute to, whether voluntary, 
contingent, or otherwise, is a party or is bound and under which any employees, 
consultants, or directors or former employees, consultants or directors of the 
Company Group are eligible to participate or derive a benefit, except any 
government-sponsored program or government-required benefit.  Schedule 3.14 
lists each Employee Plan, and identifies each Employee Plan which is a defined 
benefit plan as defined in Section 3(35) of ERISA (a "Defined Benefit Plan") or 
which is a multiemployer plan within the meaning of Section 3(37) of ERISA (a 
"Multiemployer Plan").  Neither the Company nor Holdings has any commitment to 
create any additional material Employee Plan or to modify or change any existing
Employee Plan in any material respect, except as required by law or which would 
not result in any additional material liability or obligation to Holdings or the
Company.

      (b)   (i)  Each of the Employee Plans that purports to be qualified 
      under Section 401(a) of the Code and any trusts under such Employee 
      Plans that purports to be exempt from income tax under Section 501(a) 
      of the Code has received one or more favorable determination letters 
      from the IRS for "TRA" (as defined in Rev. Proc. 93-39), or will file 
      for such determination letter prior to the expiration of the remedial 
      amendment period for such Employee Plan.  Each Employee Plan intended 
      to be qualified under Section 401(a) of the Code has been 
      administered in all material respects according to its terms, and 
      neither the Company Group, nor, to Holdings' or the Company's 
      knowledge, any fiduciary of any Employee Plan has done anything which 
      would adversely affect its qualified status or the qualified status 
      of the related trusts and no member of the Company Group is aware of 
      any circumstances likely to result in revocation of any favorable 
      determination letter in effect for any Employee Plan or related 
      trust. Each Employee Plan has been operated and administered in all 
      material respects in accordance with its terms and with applicable 
      law, including, but not limited to, ERISA and the Code, or any 
      regulations or rules promulgated thereunder.  All material reports 
      and material disclosures relating to the Employee Plans required to 
      be filed with or furnished to governmental agencies, participants, or 
      beneficiaries prior to the Closing have been or will be filed or 
      furnished in a timely manner and in accordance with applicable law.

            (ii)  With respect to any Employee Plan, no transaction has 
      occurred which could subject the Company Group to any material civil 
      penalty assessed pursuant to Section 502(1) of ERISA or tax imposed 
      by Section 4975 of the Code in an amount that would be material.  
      Neither any member of the Company Group, nor, to the Company's 
      knowledge, any administrator or fiduciary of any Employee Plan (or 
      agent of any of the foregoing) has engaged in any transaction or 
      acted or failed to act in a manner which is likely to subject any 
      member of the Company Group to any material liability for a breach of 
      fiduciary duty under ERISA.

            (iii)  No Defined Benefit Plan has been terminated in the last 
      six years, except as set forth on Schedule 3.14.  Each Defined 
      Benefit Plan listed as terminated on Schedule 3.14 has met in all 
      material respects the requirements for standard termination of 
      single-employer plans contained in Section 4041(b) of ERISA to the 
      extent such requirements were applicable to such Defined Benefit 
      Plans.

            (iv)  Except as provided in Schedule 3.14, in the last six 
      years, no member of the Company Group has completely or partially 
      withdrawn from any Multiemployer Plan.  In the last six years, no 
      member of the Company Group has suffered a 70% decline in 
      "contribution base units" (within the meaning of Section 4205(b) (1) 
      (A) of ERISA).  No termination liability to the PBGC or withdrawal 
      liability to any Multiemployer Plan that is material has been or is 
      expected to be incurred with respect to any Employee Plan by any 
      member of the Company Group.  The PBGC has not instituted, and, to 
      the knowledge of Holdings or the Company, is not planning to 
      institute, any proceedings to terminate any Employee Plan.  No notice 
      of a "reportable event", within the meaning of Section 4043 of ERISA 
      for which the 30-day reporting requirement has not been waived, has 
      been required to be filed for any Employee Plan within the 12-month 
      period ending on the date hereof, and no such notice will be required 
      to be filed as a result of the transactions contemplated by this 
      Agreement.  To the knowledge of the Company, there is no pending 
      investigation or enforcement action by the PBGC, the Department of 
      Labor (the "DOL") or IRS or any other governmental agency with 
      respect to any Employee Plan.  Under each Employee Plan that is an 
      "employee pension benefit plan" within the meaning of Section 3(2) of 
      ERISA ("Pension Plan"), as of the date of the most recent actuarial 
      valuation performed prior to the date hereof, the actuarially 
      determined present value of all "benefit liabilities", within the 
      meaning of Section 4001(a)(16) of ERISA (as determined on the basis 
      of the actuarial assumptions contained in such actuarial valuation of 
      such Pension Plan), did not exceed the then current value of the 
      assets of such Pension Plan in an amount that would be material and 
      since such date there has been neither an adverse change in the 
      financial condition of such Pension Plan nor any amendment or other 
      change to such Pension Plan that would increase the amount of 
      benefits thereunder which reasonably could be expected to result in 
      any additional material unfunded liability.

      (c)  No accumulated funding deficiency (as defined in Section 302 of ERISA
and Section 412 of the Code), whether or not waived, exists as of the date 
hereof with respect to any Employee Plan.  Each member of the Company Group has 
made full and timely payment of, or has accrued pending full and timely payment,
all amounts which are required under the terms of each Employee Plan to be paid 
as a contribution to each such Employee Plan through the date hereof.  No member
of the Company Group (x) has provided, or would reasonably be expected to be 
required to provide, security to any Pension Plan pursuant to Section 401(a)(29)
of the Code, or (y) has taken any action, or omitted to take any action, that 
has resulted, or would reasonably be expected to result, in the imposition of a 
lien under Section 412(n) of the Code or pursuant to ERISA.

      (d)  Each member of the Company Group has complied in all material 
respects with the continuation coverage requirements of Title X of the 
Consolidated Omnibus Budget Reconciliation Act of 1985, as amended.

      (e)  Except as disclosed in Schedule 3.14(e), the Company Group does not 
maintain any Employee Plans covering foreign Employees.  All Employee Plans 
covering foreign Employees comply in all material respects with applicable local
law.  The Company Group has no material unfunded liabilities that have not been 
properly accrued or reserved with respect to any Employee Plan which covers 
foreign Employees.

      (f)  With respect to each Employee Plan, if applicable, Holdings or the 
Company has provided, made available, or will make available upon request, to 
Purchaser, true and complete copies of existing:  (A) Employee Plan documents 
and amendments thereto; (B) trust instruments and insurance contracts; (C) two 
most recent Forms 5500 filed with the IRS; (D) the most recent actuarial report 
and financial statement; (E) the most recent summary plan description; (F) forms
filed with the PBGC (other than for premium payments); (G) the most recent 
determination letter issued by the IRS; (H) any Form 5310 or Form 5330 filed 
with the IRS; and (I) the most recent nondiscrimination tests performed under 
ERISA and the Code (including 401(k) and 401(m) tests).

      (g)  There is no material pending or, to the knowledge of the Company or 
Holdings, threatened legal action, suit or claim relating to the Employee Plans 
that are reasonably likely to result in any material liability to Holdings or 
the Company, other than routine claims for benefits.

      (h)  Except as disclosed on Schedule 3.14(h) or except as may be required 
by applicable law, the consummation of the transactions contemplated by this 
Agreement would not, directly or indirectly (including, without limitation, as a
result of any termination of employment prior to or following the Closing Date) 
reasonably be expected to (A) entitle any employee, consultant or director to 
any material payment (other than severance pay or similar compensation) or any 
increase in compensation, (B) result in the vesting or acceleration of any 
benefits under any Employee Plan or (C) result in any material increase in 
benefits payable under any Employee Plan.

      (i)  Except as set forth on Schedule 3.14(i), and assuming that the 
shareholder approval requirements of Code Section 280G are satisfied, as a 
result, directly or indirectly, of the transactions contemplated by this 
Agreement (including, without limitation, as a result of any termination of 
employment prior to or following the Closing Date), none of the Purchaser, 
Holdings, the Company or any of their respective subsidiaries will be obligated 
to make a payment that would be characterized as an "excess parachute payment" 
to an individual who is a "disqualified individual" (as such terms are defined 
in Section 280G of the Code).

      3.15.  Contracts. 

      (a)  Except as set forth in Schedule 3.15, neither Holdings nor the 
Company is a party to, nor bound by, nor are any of their respective properties 
subject to:

            (i)  any agreement, contract or other commitment outside the 
      ordinary course of business involving payments by or to Holdings or 
      the Company of more than $1,000,000 per any twelve-month period;

            (ii)  any contract for the employment of any officer or 
      employee (other than, with respect to any employee, contracts which 
      are terminable without liability upon notice of 30 days or less and 
      do not provide for any further payments following such termination) 
      or with a former officer, director or employee pursuant to which 
      payments by Holdings or the Company may be required to be made at any 
      time following the date hereof;

            (iii)  any contract or obligation relating to any outstanding 
      indebtedness for borrowed money by Holdings or the Company, other 
      than borrowings less than $250,000 in the aggregate;

            (iv)  except for guarantee of Company obligations by Holdings, 
      any guarantee or other contingent liability in respect of any 
      indebtedness or obligation of any Person outside of the ordinary 
      course of business; or

            (v)  any agreement or contract limiting the ability of the 
      Company to engage in any line of business or to compete with any 
      Person that has resulted in a Material Adverse Effect or a material 
      adverse effect on the value of any Owned Real Property or the real 
      property subject to any Scheduled Lease or the ability to use any 
      such real property as it is presently used.

      (b)  Complete and correct copies of all contracts, agreements and other 
instruments referred to in Schedule 3.15 have heretofore been made available to 
Purchaser by Holdings or the Company, as the case may be, except to the extent 
that disclosure of any of the foregoing is restricted by applicable 
confidentiality agreements.

(c)  Except as disclosed in Schedule 3.15, all such contracts, agreements and 
other instruments are in full force and effect and neither Holdings nor the 
Company is in default under, and no event has occurred which with notice or 
lapse of time, or both, could reasonably be expected to result in a default 
under, any contract, agreement or instrument, except for any such default which,
individually or in the aggregate, has not had and would not be reasonably likely
to have a Material Adverse Effect.

      3.16.  No Violation, Litigation or Regulatory Action.

      (a)  Holdings and the Company have complied in the conduct of their 
respective businesses with all Laws, except failures to comply which would not 
individually or in the aggregate, have or be reasonably likely to have a 
Material Adverse Effect.  Except as set forth in Schedule 3.16, neither Holdings
nor the Company has been notified in writing that it may be a potentially 
responsible party under or otherwise in violation of or noncompliance with any 
Environmental Laws, and there are no events or facts known to Holdings or the 
Company that indicate that Holdings or the Company will be such a potentially 
responsible party or will be in violation of or not in compliance with any 
Environmental Laws, in each case except for such matters as, individually or in 
the aggregate, have not or are not reasonably likely to have a Material Adverse 
Effect.

      (b)  Schedule 3.16 is a list of each action, suit, proceeding or 
investigation pending or, to Holdings' or the Company's knowledge, threatened 
against Holdings or the Company which could, individually or in the aggregate, 
reasonably be expected to result in a Material Adverse Effect.  To the actual 
knowledge of Holdings and the Company, neither Holdings nor the Company is in 
default (or would be in default with the giving of notice or lapse of time or 
both) in respect of any judgment, order, writ, injunction or decree of any court
or any Governmental Body except for any defaults that, individually or in the 
aggregate, have not had and are not reasonably likely to have a Material Adverse
Effect or a material adverse affect on the value of any Owned Real Property or 
the real property subject to any Scheduled Lease or the ability to use any such 
real property as it is presently used.

      (c)  Except as has not had and would not, individually or in the 
aggregate, be reasonably likely to result in a Material Adverse Effect, to the 
knowledge of the Company:  (i) no real property currently or formerly owned, 
leased or operated by the Company or Holdings is contaminated with any Hazardous
Substance; (ii) the Company and Holdings are not subject to liability under any 
Environmental Law for off-site disposal or contamination; (iii) neither the 
Company nor Holdings is subject to any order, decree, injunction or agreement 
with any Governmental Entity or any third party relating to any Environmental 
Law; and (iv) there are no other circumstances or conditions involving the 
Company or Holdings that could result in any claims, liabilities, costs or 
property restrictions relating to any Environmental Law.

      3.17.  Insurance.  Schedule 3.17 is a complete and correct schedule of all
currently effective material insurance policies or binders of insurance which 
relate to the business of Holdings and the Company (excluding insurance funding 
Employee Plans).

      3.18.  Certain Transactions or Arrangements.  To Holdings' and the 
Company's knowledge, except as described on Schedule 3.18 and other than 
pursuant to employee benefit arrangements and employment agreements or 
arrangements, no securityholder, officer or director of Holdings or the Company 
(and no Person with whom any such securityholder, officer or director has any 
direct or indirect relation by blood, marriage or adoption) and no Affiliate or 
associate (as such term is defined in Rule 12b-2 promulgated under the 
Securities Exchange Act of 1934, as amended), of any of the foregoing is 
presently, directly or indirectly, a party to any agreement, arrangement or 
understanding with Holdings or the Company (other than arising out of the 
employment at will of that securityholder by the Company), including without 
limitation:  (a) any contract, agreement, understanding, commitment or other 
arrangement providing for the furnishing of services or rental of real or 
personal property to or from, or otherwise relating to the business or 
operations of, Holdings or the Company; (b) any loans or advances to or from 
Holdings or the Company; (c) any arrangement pursuant to which Holdings or the 
Company may have any obligation or liability whatsoever; and (d) any transaction
of a kind which would be required to be disclosed pursuant to Item 404 of 
Regulation S-K promulgated by the Securities and Exchange Commission.

      3.19.  Finders.  Neither Holdings nor the Company is obligated to pay any 
fee or commission to any broker, finder or similar intermediary for or on 
account of the transactions contemplated by this Agreement, except Donaldson, 
Lufkin & Jenrette Securities Corporation, who have been retained by Holdings and
the Company to serve as financial advisors in connection with the transactions 
contemplated hereby.


                                 ARTICLE IV

                REPRESENTATIONS AND WARRANTIES OF THE SELLERS
                ---------------------------------------------

      As an inducement to Purchaser to enter into this Agreement and to 
consummate the transactions contemplated hereby, each Seller severally (as to 
himself, herself or itself and not as to any other Seller) hereby represents and
warrants to Purchaser as follows:

      4.1.  Authority and Related Matters.

      (a)  Except at disclosed on Schedule 4.1(a), such Seller has full legal 
right, power, capacity and authority to execute and deliver this Agreement and 
to consummate the transactions contemplated hereby and, for Sellers other than 
natural persons,  such Seller is duly organized, legally existing and in good 
standing under the laws of its jurisdiction of organization and has taken all 
corporate action necessary to authorize the execution, delivery and performance 
by such Seller of this Agreement and the consummation of the transactions 
contemplated hereby.  This Agreement has been duly authorized, executed and 
delivered by such Seller and constitutes  a valid and legally binding obligation
of such Seller enforceable against such Seller in accordance with it terms.

      (b)  Except as disclosed on Schedule 4.1(b), each Seller is the record and
beneficial owner of the aggregate number of Shares listed beside its name on 
Exhibit A and such Shares are the only Shares owned by such Seller.  Except for 
this Agreement and the transactions contemplated hereby, and except as provided 
in the Certificate of Designations or as disclosed on Schedule 4.1(b), there are
no agreements, arrangements, warrants, options, puts, calls, or other rights, of
any character to which such Seller is a party or by which any Shares owned by 
Seller are bound relating to the issuance, sale, purchase, redemption, 
conversion, exchange, registration, voting or transfer of any such Shares, other
than those which, pursuant to their terms, will terminate immediately on the 
Closing Date.  As of the Closing Date, the Shares to be sold by the Seller will 
be transferred to Purchaser free of any preemptive or subscription rights and 
free and clear of all Encumbrances.

      (c)  The execution and delivery by such Seller of this Agreement and the 
consummation by such Seller of any of the transactions contemplated hereby will 
not:

            (i)  violate, conflict with, result with the giving of notice 
      or lapse of time or both in a breach of the terms, conditions or 
      provisions of, or constitute a default, an event of default or an 
      event creating rights of acceleration, amendment, termination or 
      cancellation or a loss of rights under, or result in the creation or 
      imposition of any Encumbrance upon, any of the assets or properties 
      of such Seller, Holdings or the Company, any articles of 
      organization, bylaws, trust agreement, partnership agreement or 
      certificate of partnership or other constitutive documents of the 
      Seller, or, except as would not prevent or delay the consummation of 
      the transactions contemplated hereby, any note, instrument, 
      agreement, mortgage, lease, license, franchise, Governmental Permit 
      or judgment, order, award or decree to which such Seller is a party 
      or by which the Seller is bound, or any Law affecting such Seller; or

            (ii)  except as set forth on Schedule 4.1(c), require the 
      approval, consent, authorization or act of, or the making by such 
      Seller of any declaration, filing or registration with, any 
      Governmental Body or other Person.

      4.2.  No Finder.  Such Seller has not made any arrangement which would 
obligate Purchaser, Holdings or the Company to pay any fee or commission (or 
reimburse expenses) to any broker, finder or similar intermediary for or on 
account of the transactions contemplated by this Agreement.  


                                  ARTICLE V

                 REPRESENTATIONS AND WARRANTIES OF PURCHASER
                 -------------------------------------------

      As an inducement to Holdings, the Company and the Sellers to enter into 
this Agreement and to consummate the transactions contemplated hereby, Purchaser
hereby represents and warrants to the Company and the Seller as follows:

      5.1.  Organization of Purchaser.  Purchaser is a corporation duly 
organized, legally existing and in good standing under the laws of the 
jurisdiction of its formation and has full corporate power and authority to own 
or lease and to operate and use its properties and assets and to carry on its 
business as now conducted.

      5.2.  Authority of Purchaser.  

      (a)  Purchaser has the requisite power and authority to execute and 
deliver this Agreement and all of the other instruments contemplated hereby to 
be executed by it, to consummate the transactions contemplated hereby and to 
comply with the terms, conditions and provisions hereof.  The execution, 
delivery and performance of this Agreement by Purchaser have been duly 
authorized and approved by all necessary corporate action on behalf of Purchaser
and do not require any further authorization or consent of Purchaser or its 
stockholders.  This Agreement is, and each other instrument of Purchaser 
contemplated hereby to be executed by it will be, the legal, valid and binding 
obligation of Purchaser enforceable against Purchaser in accordance with its 
terms.

      (b)  Neither the execution and delivery of this Agreement by Purchaser or 
any of the other instruments contemplated hereby, the consummation by Purchaser 
of any of the transactions contemplated hereby nor compliance by Purchaser with 
or fulfillment by Purchaser of the terms, conditions and provisions hereof will:

            (i)  violate, conflict with or result in the giving of notice 
      or lapse of time or both in a breach of the terms, conditions or 
      provisions of, or constitute a default, an event of default or an 
      event creating rights of acceleration, termination or cancellation or 
      a loss of rights under the Memorandum and Articles of Association of 
      the Purchaser, or any note, instrument, agreement, mortgage, lease, 
      license, franchise, Governmental Permit or judgment, order, award or 
      decree to which Purchaser is a party, to which any of its properties 
      is subject, or by which Purchaser is bound except as would not 
      prevent or delay consummation of the transactions contemplated 
      hereby; or

            (ii)  except as set forth on Schedule 3.4 or referenced in 
      Section 5.7, require the approval, consent, authorization or act of, 
      or the making by Purchaser of any declaration, filing or registration 
      with, any Governmental Body or other Person.

      5.3.  No Finder.  Neither Purchaser nor any party acting on its behalf has
paid or become obligated to pay any fee or commission to any broker, finder or 
intermediary for or on account of the transactions contemplated by this 
Agreement, other than fees payable to Goldman, Sachs & Co.

      5.4.  Investment Intent.  Purchaser is purchasing the Shares hereunder 
solely for its own account and with no intention of distributing or reselling 
the Shares or any part thereof, or interest therein, in any transaction that 
would be in violation of the Securities Act or any other securities laws of the 
United States of America or any state thereof.

      5.5.  Status as Accredited Investor.  Purchaser is an "accredited 
investor" (as that term is defined in Rule 501 of Regulation D under the 
Securities Act).  Purchaser has such knowledge and experience in business and 
financial matters so that Purchaser is capable of evaluating the merits and 
risks of an investment in the Shares.  Purchaser understands the full nature and
risk of an investment in the Shares.  Purchaser further acknowledges that it has
had access to the books and records of Holdings and the Company, is generally 
familiar with the business being conducted by the Company and has had an 
opportunity to ask questions concerning the Company and the Shares; provided, 
however, that nothing herein shall affect the representations and warranties of 
Holdings and the Company hereunder, any of the obligations of Holdings or the 
Company, or any of Purchaser's rights under Section 6.1 hereof.

      5.6.  Financial Capability.  Purchaser has, or has entered into binding 
commitments to have and will have immediately prior to the Closing, funds 
sufficient to consummate the transactions contemplated hereby.  Purchaser 
acknowledges and agrees that its obligations to consummate the transactions 
contemplated hereby are not contingent upon its ability to obtain any third 
party financing.

      5.7.  Governmental Consents.  No consent, approval or authorization of, or
declaration, filing or registration with, any governmental or regulatory 
authority (other than such as are required pursuant to the H-S-R Act and filings
with the Attorney General's office for the Commonwealth of Massachusetts (the 
"Massachusetts Attorney General")) is required to be made or obtained by 
Purchaser in connection with the execution, delivery and performance of this 
Agreement.


                                 ARTICLE VI

                            ADDITIONAL COVENANTS
                            --------------------

      The respective parties hereto covenant and agree to take, or to cause 
Holdings or the Company to take, the following actions between the date hereof 
and the Closing Date:

      6.1.  Investigation of Holdings and the Company by Purchaser.  Holdings 
and the Company shall afford to the officers, employees and authorized 
representatives of Purchaser (including, without limitation, independent public 
accountants, attorneys, environmental consultants and engineers) and to the 
employees and authorized representatives of Purchaser's financing sources, 
reasonable access during normal business hours to the offices, properties, 
employees and business and financial records (including computer files, 
retrieval programs and similar documentation) of Holdings and the Company to the
extent Purchaser shall reasonably deem necessary or desirable and shall furnish 
to Purchaser or its authorized representatives, such additional information 
concerning Holdings and the Company and their properties, assets, businesses and
operations as shall be reasonably requested, including all such information as 
shall be necessary to enable Purchaser or its representatives to verify the 
accuracy of the representations and warranties contained in Article III, to 
verify that the covenants of Holdings and the Company in Section 6.3 have been 
complied with, and to determine whether the conditions set forth in Article VII 
have been satisfied; provided, however, that Holdings and the Company shall not 
be required to provide such access or information to the extent that it has been
advised by outside counsel that the provision of such access or information 
could reasonably be deemed to violate antitrust laws, including, without 
limitation, the provision of information concerning prices charged by the 
Company at individual locations, how such prices are determined, or otherwise to
communicate with Holdings or the Company concerning price or price related 
issues.  Purchaser covenants that such investigation shall be conducted in such 
a manner as not to interfere unreasonably with the operations of Holdings or the
Company.  No investigation by Purchaser or its representatives hereunder shall 
affect the representations and warranties of Holdings or the Company.  Nothing 
in this section shall be interpreted so as to grant Purchaser the right to 
perform invasive or subsurface investigations of the properties.

      6.2.  Confidentiality.  Any information provided to Purchaser or its 
representatives or any information provided to Holdings, the Company or the 
Sellers or their respective representatives pursuant to this Agreement shall be 
held by such party and its representatives in accordance with, and shall be 
subject to the terms of, the Confidentiality Agreement, dated July 29, 1997 by 
and among Purchaser and Investcorp International Inc.

      6.3.  Certain Agreements.  Each of the parties hereto shall use his, her 
or its reasonable best efforts to consummate the transactions contemplated by 
this Agreement.  Each party shall promptly notify the others of any action suit 
or proceeding that shall be instituted or threatened against such party to 
restrain, prohibit, otherwise challenge the legality of or delay any transaction
contemplated by this Agreement.  Holdings and the Company shall promptly notify 
Purchaser of any lawsuit, claim, proceeding or investigation that may be 
threatened, brought, asserted or commenced after the date hereof against 
Holdings or the Company that would have been required to be included on Schedule
3.16, and, in the case of any of the foregoing pending on the date hereof, of 
any material development with respect thereto.  Each of Holdings and the Company
on the one hand, and Purchaser on the other, shall give prompt notice to the 
other parties of (a) any notice or other communication received by any such 
Person from any Governmental Body or third Person alleging that the consent of 
such Governmental Body or third Person is or may be required in connection with 
the transactions contemplated by this Agreement, (b) the occurrence of any event
or circumstance which could have a Material Adverse Effect on the Company or 
Holdings or prevent or delay the consummation of the transactions contemplated 
hereby, and of which such party has knowledge, or (c) the breach of any material
representation, warranty, covenant or other material agreement contained in this
Agreement by such party.

      6.4.  Operations Prior to the Closing Date.  

      (a)  Subject to Section 6.4(b) hereof, Holdings and the Company shall 
operate and carry on their businesses only in the ordinary course, except as 
otherwise expressly contemplated by this Agreement.  In furtherance and not in 
limitation of the foregoing, Holdings and the Company shall use reasonable 
efforts consistent with good business practice to (i) keep and maintain their 
respective assets and properties in normal operating condition and repair, (ii) 
maintain the business organization of Holdings and the Company intact and (iii) 
preserve the goodwill of the suppliers, employees, customers and others having 
business relations with them.

      (b)  Except as contemplated by this Agreement, neither Holdings nor the 
Company shall without the express prior written approval of Purchaser (which 
shall not be unreasonably withheld):

            (i)  amend its articles of organization or bylaws or the 
      Certificate of Designations;

            (ii)  issue or agree to issue any shares of its capital stock 
      (by the issuance or granting of options, warrants or rights to 
      purchase any shares of capital stock), or any securities exercisable 
      or exchangeable for or convertible into such capital stock, or other 
      securities, except in connection with the exercise of Holdings 
      Options granted prior to the date hereof pursuant to the Holdings 
      Option Plan;

            (iii)  split, combine or reclassify any shares of capital stock 
      or declare, set aside or pay any dividends or make any other 
      distributions (whether in cash, stock or other property) in respect 
      of such shares, except for the payment by the Company to Holdings of 
      such dividends or the making of such other distributions by the 
      Company to Holdings that are consistent with past practice;

            (iv)  issue, transfer, sell or deliver any shares of its 
      capital stock (or securities convertible into or exchangeable or 
      exercisable for, with or without additional consideration, such 
      capital stock) or any other interest therein, except (A) in 
      connection with exercise of Holdings Options granted prior to the 
      date hereof pursuant to the Holdings Option Plan and (B) in 
      connection with the reallocation of Holdings Options, surrendered 
      after the date hereof and prior to the Closing, or repurchased 
      Shares, as determined by the Board of Directors of Holdings, not to 
      exceed the amounts set forth in Section 3.2(b) hereof in either case;

            (v)  redeem, purchase or otherwise acquire for any 
      consideration (A) any outstanding shares of its capital stock or 
      securities carrying the right to acquire, or which are convertible 
      into or exchangeable or exercisable for, with or without additional 
      consideration, such capital stock, (B) any other securities of 
      Holdings or the Company, or (C) any interest in any of the foregoing, 
      except as contemplated by this Agreement and the redemption or 
      repurchase of shares of Class C Stock from employees of Holdings or 
      the Company in connection with the termination of such employee's 
      employment with Holdings or the Company;

            (vi)  incur any indebtedness for borrowed money, except (A) 
      borrowings in the ordinary course of business consistent with past 
      practice under the Senior Credit Agreement and (B) other borrowings 
      not in excess of $500,000;

            (vii)  make any acquisition or disposition of stock or other 
      securities or assets of any person outside of the ordinary course of 
      business in excess of $250,000, excluding all purchases of inventory 
      and equipment in the ordinary course of business consistent with past 
      practice;

            (viii)  incur capital expenditures materially in excess of 
      those contemplated by the Company's spending plan attached as 
      Schedule 6.4(b)(viii);

            (ix)  merge or consolidate with any corporation or other 
      entity;

            (x)  enter into any employment or similar contract with, or 
      materially increase the compensation payable to, any officer, 
      director or employee, except increases in non-executive officer 
      compensation in the ordinary course of business consistent with past 
      practice;

            (xi)  alter in any material respect its practices and policies 
      relating to the payment and collection, as the case may be, of 
      accounts payable and accounts receivable;

            (xii)  except as contemplated by or described in this 
      Agreement, adopt, amend in any material respect or terminate any 
      Employee Plan, severance plan or collective bargaining agreement or 
      make awards or distributions under any Employee Plan, except awards 
      or distributions to any participant or employee other than directors 
      and executive officers in the ordinary course consistent with past 
      practice;

            (xiii)  create, assume or suffer to be incurred any Encumbrance 
      of any kind on any of its properties or assets other than (A) 
      Encumbrances in the ordinary course of business consistent with past 
      practices, as long as the creation, assumption or sufferance thereof 
      does not interfere with, hinder or delay the transactions 
      contemplated hereby and (B) Permitted Encumbrances;

            (xiv)  amend, supplement or modify any material contract except 
      in the ordinary course of business;

            (xv)  settle or compromise any claims, actions, proceedings or 
      litigation involving material liability for money damages or placing 
      any restrictions on the operations of the Company's businesses; or 
      waive, release or assign any material rights or claims under any 
      material contracts outside of the ordinary course of business 
      consistent with past practice;

            (xvi)  make any material Tax election or make any material 
      change in its insurance coverages; or

            (xvii)  agree, commit or resolve to do or authorize any of the 
      foregoing.

      6.5.  No Public Announcement.  Prior to the Closing Date, neither 
Purchaser, Holdings, the Company nor any Seller shall, without the approval of 
Purchaser and Holdings (which shall not be unreasonably withheld), make any 
press release or other public announcement concerning the transactions 
contemplated by this Agreement, except as and to the extent that any such party 
shall be so obligated by law, in which case Purchaser and Holdings shall be 
advised, and Purchaser and Holdings shall use their reasonable efforts to cause 
mutually agreeable releases or announcements to be issued.  On the date hereof 
and on the Closing Date, the parties shall issue press release(s) which shall be
reasonably acceptable to both Holdings and Purchaser.

      6.6.  Governmental Filings; Consents.  

      (a)  The Sellers, Holdings, the Company and Purchaser shall cooperate with
each other in filing any necessary applications, reports or other documents with
any federal or state agencies, authorities or bodies (domestic or foreign) 
having jurisdiction with respect to the sale of the Shares and this Agreement 
and the transactions contemplated hereby, and in seeking necessary consultation 
with and prompt favorable action by, including required consents of, any such 
agencies, authorities or bodies.

      (b)  Notwithstanding any provision of this Agreement to the contrary none 
of Purchaser, the Company or Holdings shall be required in connection with the 
receipt of any regulatory approval, to proffer to, or agree to sell, permanently
hold separate or discontinue operations at retail grocery stores the loss of 
which would have a material and adverse impact on the economic benefits to 
Purchaser of the transactions contemplated by this Agreement (it being agreed 
that if Purchaser reasonably believes after consulting with outside counsel that
representatives of any of the authorities or bodies referred to in Section 
6.6(a) are reasonably certain to ultimately require such action in connection 
with the transactions contemplated by this Agreement which would result in such 
impact, Purchaser and Holdings shall each have the right to terminate this 
Agreement without liability to any of the other parties hereto); provided, 
however, that if any of the authorities or bodies referred to in Section 6.6(a) 
shall ultimately require Purchaser, the Company or Holdings to proffer to, or 
agree to sell, permanently hold separate or discontinue operations at retail 
grocery stores the loss of which would have a material and adverse impact on the
Company, the Aggregate Purchase Price shall be reduced by $2.75 million per 
retail grocery store required to be sold, permanently held separate or 
discontinued in excess of the number of stores the loss of which would have a 
material and adverse impact on the Company.

      6.7.  Directors' and Officers' Indemnification.

      (a)  With respect to the current members of Holdings' and the Company's 
Boards of Directors, Holdings and the Company shall not take any action to 
directly or indirectly disaffirm or adversely affect the provisions of their 
respective articles of organization and bylaws relating to indemnification of 
officers and directors.

      (b)  The Company and Holdings shall indemnify, defend and hold harmless 
each person who is now, or has been at any time prior to the date hereof or who 
becomes prior to the Closing Date, an officer or director of Holdings or the 
Company (the "Indemnified Parties") against all losses, claims, damages, costs, 
expenses (including attorneys fees and expenses), liabilities or judgments or 
amounts that are paid in settlement with the approval of the indemnifying party 
(which approval shall not be unreasonably withheld) of or in connection with any
threatened or actual claim, action, suit, proceeding or investigation based in 
whole or in part on or arising in whole or in part out of the fact that such 
person is or was a director or officer of Holdings or the Company whether 
pertaining to any matter existing or occurring at or prior to the Closing Date 
and whether asserted or claimed prior to, or at or after, the Closing Date, (the
"Indemnified Liabilities"), including all Indemnified Liabilities based in whole
or in part on, or arising in whole or in part out of, or pertaining to this 
Agreement or the transactions contemplated hereby, in each case to the full 
extent a corporation is permitted under applicable law to indemnify its own 
directors or officers as the case may be (and, after the Closing Date, the 
Purchaser shall, or shall cause Holdings or the Company to pay expenses in 
advance of the final disposition of any such action or proceeding to each 
Indemnified Party to the full extent permitted by applicable law provided such 
Indemnified Party undertakes to promptly repay such advances if such Indemnified
Party is determined by a court of competent jurisdiction not to be entitled to 
indemnification).  Without limiting the foregoing, in the event any such claim, 
action, suit, proceeding or investigation is brought against any Indemnified 
Parties (whether arising before or after the Closing Date), (i) the Company and 
Holdings shall have the right to assume the defense of any such claim, action, 
suit, proceeding or investigation brought against any Indemnified Party and 
shall not be liable to such Indemnified Parties for any legal expenses or other 
counsel or any other expenses subsequently incurred by such Indemnified Parties 
in connection with the defense thereof; and (ii) Purchaser, Holdings, the 
Company and each Indemnified Party will use all reasonable efforts to assist in 
the vigorous defense of any such matter, provided that neither Holdings, nor the
Company nor the Purchaser shall be liable for any settlement effected without 
its prior written consent which consent shall not unreasonably be withheld.  Any
Indemnified Party wishing to claim indemnification under this Section 6.7 upon 
learning of any such claim, action, suit, proceeding or investigation, shall 
promptly notify the Purchaser (but the failure so to notify shall not relieve a 
party from any liability which it may have under this Section 6.7 except to the 
extent such failure prejudices such party).  The Company and Holdings shall be 
required to retain only one law firm to represent themselves and the Indemnified
Parties with respect to each such matter unless there is, under applicable 
standards of professional conduct, a conflict on any significant issue between 
the positions of any two or more Indemnified Parties.  The parties hereto agree 
that all rights to indemnification, including provisions relating to advances of
expenses incurred in defense of any such action or suit, existing in favor of 
the Indemnified Parties with respect to matters occurring through the Closing 
Date shall continue in full force and effect for a period of not less than six 
years from the Closing Date; provided, however, that all rights to 
indemnification in respect of any Indemnified Liabilities asserted or made 
within such period shall continue until the disposition of such Indemnified 
Liabilities.

      (c)  For six years from the Closing Date, Holdings and the Company shall 
use their best efforts to maintain, if available, officers' and directors' 
liability insurance covering the persons who are presently covered by their 
officers' and directors' liability insurance policies (copies of which have 
heretofore been delivered to Purchaser) with respect to actions and omissions 
occurring prior to the Closing Date, on terms which are not materially less 
favorable than the terms of such current insurance in effect for Holdings and 
the Company on the date hereof; provided, however, that in no event shall 
Holdings or the Company be obligated to pay annual premiums greater than 200% of
such premiums paid or payable as of the date hereof; provided, further, that if 
any annual premium for such coverage and amount of insurance would exceed 200% 
of such annual rate, Holdings and the Company shall provide the maximum coverage
which shall then be available at an annual premium equal to 200% of such rate.  
Purchaser shall cause Holdings or the Company to pay such premiums.

      (d)  Purchaser covenants for itself and its successors, and assigns, that 
they shall not institute any action or proceeding in any court or before any 
administrative agency or before any other tribunal against any of the current 
directors of Holdings or the Company, in their capacity as such, with respect to
any liabilities, actions or causes of action, judgments, claims and demands of 
any nature or description (consequential, compensatory, punitive or otherwise), 
in each such case solely to the extent resulting from their approval of this 
Agreement or the transactions contemplated hereby.

      6.8.  Employee Benefits.  From and after the Closing, Purchaser shall, and
shall cause its subsidiaries to, honor all employee benefit obligations to 
current and former employees of the Company that have accrued or otherwise 
become due under the Employee Plans; provided, that except as specifically set 
forth in the Employee Plans, nothing shall prevent Purchaser from amending or 
terminating any Employee Plan.  From and after the Closing, Holdings and the 
Company shall maintain and perform all obligations pursuant to employee benefit 
plans, policies and agreements that have accrued or otherwise become due on or 
before the Closing.

      6.9.  Acquisition Proposals.  Until the earlier of the termination of this
Agreement in accordance with its terms and the Closing, each of the Sellers, 
Holdings and the Company agrees that neither they, nor their respective 
officers, directors, employees, agents or representatives (including any 
investment banker, attorney or accountant) retained by the Company or Holdings 
shall solicit any inquiries or the making of any proposal or offer with respect 
to a merger, consolidation or similar transaction involving, or any purchase of 
all or any significant portion of the assets or any equity securities of 
Holdings or the Company (any such offer or proposal being referred to as an 
"Acquisition Proposal"), or provide any confidential information or data to any 
Person relating to an Acquisition Proposal.  Each of the Sellers, Holdings and 
the Company will promptly request the return or destruction of any information 
and data provided to any Person with whom discussions concerning an Acquisition 
Proposal have taken place in the prior 120 days.

      6.10.  Notices and Consents.  The Company, Holdings and Sellers shall use 
reasonable efforts to give notices and use reasonable efforts to obtain the 
consent and/or waiver of covenants and defaults required from landlords under 
the Scheduled Leases and shall use reasonable efforts to give all required 
notices and use all reasonable efforts to obtain the consent and/or waiver of 
covenants and defaults required from any Persons under any Scheduled Leases or 
material contracts listed on the Schedules hereto.

      6.11.  Balance Sheet.  Within 40 days of the date hereof, Holdings will 
provide Purchaser with the unqualified opinion of Ernst & Young LLP with respect
to the Holdings Balance Sheet referred to in Section 3.5(a).

      6.12.  Termination of Agreements.  The Company, Holdings and Sellers shall
cause all contracts, agreements and other commitments between the Company or 
Holdings and any Seller or any Affiliate of Seller (other than Scheduled Leases 
and any notes or other evidences of indebtedness or employment, severance or 
benefit plans existing as of the date hereof copies of which were previously 
provided to Purchaser) to be terminated without any termination fee or penalty 
effective as of the Closing Date.

      6.13.  Information Technology.  Holdings and the Company shall afford 
Purchaser's information technology consultants reasonable access during normal 
business hours to the Company's computer hardware, software and related 
equipment and facilities and will cooperate with Purchaser's information 
technology consultants in implementing the policies, procedures and other 
matters described on Schedule 6.4(b)(viii) hereto provided, however, that all 
costs and expenses associated with the foregoing shall be borne by Purchaser and
neither Holdings nor the Company shall be required to take any action that would
impair, prevent or materially delay Holdings or the Company's implementation of 
alternative policies and procedures.


                                 ARTICLE VII

              CONDITIONS PRECEDENT TO OBLIGATIONS OF PURCHASER
              ------------------------------------------------

      The obligations of Purchaser to consummate the transactions contemplated 
by this Agreement shall be subject to the satisfaction, on or prior to the 
Closing Date, of the following conditions:

      7.1.  No Misrepresentation or Breach of Covenants and Warranties.  

      (a)   (i) There shall have been no material breach by Holdings or the 
Company in the performance of any of their covenants, agreements and obligations
herein; (ii) the representations and warranties set forth in Sections 3.1, 3.2, 
3.4(a), 3.5(c) and 3.5(d)(as Section 3.5(d) relates to the Company Financial 
Statements) shall be true and correct on the date hereof and as of the Closing 
Date (except for such statements therein that address matters only as of a 
specific date which shall be true as of such specific date); and (iii) none of 
the other representations and warranties contained in Article III hereof shall 
fail to be true and correct on the date hereof or on the Closing Date as though 
made on the Closing Date, except for (A) representations and warranties that 
speak as of a specific date or time other than the Closing Date (which need only
be true and correct, subject to clause (B) or (C) hereof as applicable, as of 
such date or time), (B) representations and warranties which are not qualified 
by Material Adverse Effect or otherwise by material adversity (which need be 
true and correct except for such inaccuracies as in the aggregate (together with
the inaccuracies referred to in the following clause (C)) as would not have a 
Material Adverse Effect, (C) representations and warranties which are qualified 
by Material Adverse Effect or otherwise by material adversity (which need be 
true and correct without regard to such qualification except for such 
inaccuracies as in the aggregate (together with the inaccuracies referred to in 
the preceding clause (B)) as would not have a Material Adverse Effect), and (D) 
changes therein specifically permitted by this Agreement or resulting from any 
transaction expressly consented to in writing by Purchaser.

      (b)   (i) There shall have been no material breach by the Sellers in the 
performance of any of their covenants, agreements and obligations herein; (ii) 
the representations and warranties set forth in Section 4.1(a) and (b) shall be 
true and correct on and as of the Closing Date; and (iii) none of the other 
representations and warranties of Sellers contained in Article IV shall fail to 
be true and correct in any material respect on the date hereof and on the 
Closing Date.

      7.2.  Resignations of Directors.  Prior to the Closing, Purchaser shall 
notify Holdings and the Company of those directors of Holdings and the Company 
from whom it will require resignations.  Holdings and the Company shall have 
furnished Purchaser with such signed resignations, effective as of the Closing.

      7.3.  Litigation.  As of the Closing Date, there shall be no Law, 
injunction, restraining order or decree of any nature of any court or other 
Governmental Body of competent jurisdiction that is in effect that restrains or 
prohibits the consummation of the transactions or other material obligations of 
the parties hereto as contemplated hereby and no proceeding seeking any such 
relief or seeking material damages with respect to the transactions contemplated
hereby shall be pending by any Governmental Body of competent jurisdiction.

      7.4.  Governmental Approvals.  All material authorizations, consents and 
approvals of (or filings with) any Governmental Body shall have been obtained or
made and any waiting period under applicable federal or state antitrust laws 
shall have expired or been earlier terminated.

      7.5.  FIRPTA Affidavit.  On or prior to the Closing Date, Holdings shall 
deliver a true and accurate certification satisfying the requirements of 
[SECTION]1.1445-2(c)(3) of the Treasury Regulations.  In compliance with Section
1.897-2(h)(2) and Section 1.1445-2(c)(3) of the Treasury Regulations, 
notification that such certification has been given or shall be made to the 
Internal Revenue Service.

      7.6.  Transaction Expenses.  On or prior to the Closing Date, Holdings and
the Company shall provide evidence reasonably satisfactory to Purchaser that, 
upon payment by Holdings of invoices submitted by Ernst & Young LLP, Gibson, 
Dunn & Crutcher LLP and Donaldson, Lufkin & Jenrette Securities Corporation all 
amounts due by Holdings, the Sellers or the Company to each of such firms for 
services related to this Agreement have been paid in full and that none of 
Holdings, the Company nor Purchaser shall have any further liability or 
obligations in respect thereof.


                                ARTICLE VIII

                     CONDITIONS PRECEDENT TO OBLIGATIONS
                  OF HOLDINGS, THE COMPANY AND THE SELLERS
                  ----------------------------------------

      The obligations of Holdings, the Company and the Sellers to consummate the
transactions contemplated by this Agreement shall, at their respective options, 
be subject to the satisfaction on or prior to the Closing Date, of the following
conditions:

      8.1.  No Misrepresentation or Breach of Covenants and Warranties.  There 
shall have been no material breach by Purchaser in the performance of any of its
covenants and agreements herein; each of the representations and warranties of 
Purchaser contained or referred to in this Agreement shall be true and correct 
on the Closing Date as though made on the Closing Date, except for (a) 
representations and warranties that speak as of a specific date or time other 
than the Closing Date (which need only be true and correct as of such date or 
time), (b) representations and warranties which are not qualified by a material 
adverse effect (which need be true and correct except for such inaccuracies as 
in the aggregate would not have a Material Adverse Effect) and (c) changes 
therein specifically permitted by this Agreement or resulting from any 
transaction expressly consented to in writing by Holdings and the Company; and 
there shall have been delivered to Holdings a certificate to such effect, dated 
the Closing Date and signed by a Group Board Director of Purchaser.

      8.2.  Litigation.  At the Closing Date, there shall be no Law, injunction,
restraining order or decree of any nature of any court or other Governmental 
Body of competent jurisdiction that is in effect that restrains or prohibits the
consummation of the transactions or other material obligations of the parties 
hereto as contemplated hereby, and no proceeding seeking any such relief or 
seeking material damages with respect to the transactions contemplated hereby 
shall be pending by any Governmental Body of competent jurisdiction.

      8.3.  Governmental Approvals.  All material authorizations, consents and 
approvals of (or filings with) any Governmental Body shall have been obtained or
made and any waiting period under applicable federal or state antitrust laws 
shall have expired or been earlier terminated.


                                 ARTICLE IX

                                 TERMINATION
                                 -----------

      9.1.  Termination.  (A)  Notwithstanding anything to the contrary in this 
Agreement, this Agreement may be terminated any time prior to the Closing Date:

      (a)  by the mutual consent of Purchaser and Holdings (for and on behalf of
itself, the Company and each Seller);

      (b)  by Purchaser (i) in the event that on or prior to May 1, 1999, any 
condition set forth in Article VII other than the condition set forth in Section
7.4 with respect to applicable federal or state antitrust laws (the "Purchaser 
Antitrust Condition") shall not be satisfied and shall not be reasonably capable
of being satisfied on or prior to May 1, 1999 and (ii) in the event that after 
May 1, 1999 but on or prior to July 1, 1999 any condition set forth in Article 
VII other than the Purchaser Antitrust Condition shall not be satisfied and 
shall not be capable of being satisfied on or prior to July 1, 1999;

      (c)  by Holdings (for and on behalf of itself, the Company and Sellers) 
(i) in the event that any condition set forth in Article VIII other than the 
condition set forth in Section 8.3 relating to applicable federal or state 
antitrust laws shall not be satisfied and shall not be reasonably capable of 
being satisfied prior to the Closing Date and (ii) with effect as of May 1, 
1999, in the event Holdings shall notify Purchaser in writing (the "Holdings 
Notice") on or prior to May 1, 1999 of its desire to terminate this Agreement 
and Purchaser, within three business days of receipt of such notice (but in no 
event earlier than May 1, 1999), shall not provide Holdings with written notice 
(the "Purchaser Notice") that it has entered into a written agreement with the 
staff of the relevant Federal regulatory authority (the "Staff Agreement") 
regarding the steps necessary to consummate the transactions contemplated by 
this Agreement provided, however, that if such Purchaser Notice is delivered the
Agreement shall not terminate effective as of May 1, 1999 and the Holdings 
Notice shall be void and have no force or effect.  A copy of the Staff Agreement
shall be attached to the Purchaser Notice;

      (B)  Except as agreed in writing by the Purchaser and Holdings (for and on
behalf of itself, the Company and Sellers) this Agreement shall terminate on 
July 1, 1999, unless the Closing has occurred on or prior to such date;

      (C)  No Party may terminate this Agreement pursuant to Sections 9.1(A)(b) 
or (A)(c) if the failure of the condition (or failure of the condition to be 
reasonably capable of being satisfied within the applicable time period) giving 
rise to the right to terminate results from the breach by such party of any of 
its covenants in this Agreement.

      9.2.  Effect of Termination.  (A)  In the event Purchaser terminates this 
Agreement pursuant to Section 9.1(A)(b)(ii) or Section 6.6(b), or this Agreement
terminates pursuant to Section 9.1(B), in each case after Purchaser has given 
Holdings the Purchaser Notice in accordance with 9.1(A)(c)(ii).  Upon such 
termination, Purchaser shall promptly pay Holdings $20 million by wire transfer 
of immediately available funds to an account designated by Holdings a reasonable
amount of time in advance thereof.

      (B)  In the event Purchaser terminates this Agreement pursuant to Section 
9.1(A)(b)(ii) or Section 6.6(b) after May 1, 1999 or this Agreement terminates 
pursuant to Section 9.1(B), in either case without Holdings having given 
Purchaser the Holdings Notice in accordance with 9.1(A)(c)(ii).  Upon such 
termination, Purchaser shall promptly pay Holdings $10 million in immediately 
available funds to an account designated by Holdings a reasonable amount of time
in advance thereof.

      (C)  Notwithstanding Sections 9.2(A) and (B), Purchaser shall not be 
required to make either the payment referred to in Section 9.2(A) or the payment
referred to in Section 9.2(B) if Purchaser shall terminate this Agreement as a 
result of the failure of the condition (or failure of the condition to be 
reasonably capable of being satisfied within the applicable time period) set 
forth in Section 7.1(a)(i) or 7.1(b)(i).

      (D)  Termination of this Agreement pursuant to this Article IX will not 
relieve any party from liability for breach of this Agreement prior to such 
termination.

      9.3.  No Liability Upon Termination.  In the event that this Agreement 
shall be terminated pursuant to this Article IX, all obligations of the parties 
under this Agreement (other than under this Section 9.3, Section 6.2, Section 
10.5, and Section 10.12) shall be terminated without liability or penalty on the
part of any party or its officers, directors or general or limited partners to 
any other party, other than as may result from any breach by a party of this 
Agreement and unpaid payment obligations, if any, under Section 9.2.

                                  ARTICLE X

                             GENERAL PROVISIONS
                             ------------------

      10.1.  Non-survival of Representations, Warranties and Agreements.  All 
representations and warranties set forth in Article III of this Agreement shall 
terminate at Closing.  All covenants and agreements set forth in this Agreement 
shall survive in accordance with their terms.

      10.2.  Notices.  All notices and other communications given or made 
pursuant to this Agreement shall be in writing and shall be deemed to have been 
duly given or made (a) five business days after being sent by registered or 
certified mail, return receipt requested, (b) upon delivery, if hand delivered, 

      (c)  one business day after being sent by prepaid overnight carrier with 
guaranteed delivery, with a record of receipt, or (d) upon transmission with 
confirmed delivery if sent by cable, telegram, facsimile or telecopy (with a 
copy simultaneously sent by registered or certified mail, return receipt 
requested), to the parties at the following addresses (or at such other 
addresses as shall be specified by the parties by like notice):

      (a)   if to Purchaser:


            J Sainsbury plc 
            Stamford Street
            London, England SE1 9ll
            Attention: Deputy Group Chief Executive
            Telecopy: 0171-695 7610

      with a copy to:


            Sullivan & Cromwell
            125 Broad Street
            New York, New York 10004
            Attention: Neil T. Anderson, Esq.
            Telecopy: (212) 558-3588

      (b)  if to the Company:


            Star Markets Company, Inc.
            625 Mount Auburn Street
            Cambridge, Massachusetts 02138
            Attention: President
            Telecopy: (617) 528-2321

      with a copy to: 


            Gibson, Dunn & Crutcher LLP
            200 Park Avenue
            New York, New York 10016
            Attention: E. Michael Greaney, Esq.
            Telecopy: (212) 351-4035

      if to Sellers: 


            c/o Investcorp Management Services Limited
            P.O. Box 5340
            Manama, Bahrain
            Attention: H. Richard Lukens III
            Telecopy:  011-973-531-927

      with a copy to:


            Gibson, Dunn & Crutcher LLP
            200 Park Avenue
            New York, New York 10016
            Attention: E. Michael Greaney, Esq.
            Telecopy: (212) 351-4035

      (d  if to Holdings:


            c/o Investcorp International, Inc.
            280 Park Avenue
            New York, New York 10017
            Attention: Christopher J. O'Brien
            Telecopy:  212-983-7073

      with a copy to:

            Gibson, Dunn & Crutcher LLP
            200 Park Avenue
            New York, New York  10166
            Attention: E. Michael Greaney, Esq.
            Telecopy: 212-351-4035

      10.3.  Partial Invalidity.  Wherever possible, each provision hereof shall
be interpreted in such manner as to be effective and valid under applicable law,
but in the case that any provision contained herein shall, for any reason, be 
held to be invalid, illegal or unenforceable in any respect, such invalidity, 
illegality or unenforceability shall not affect any other provisions of this 
Agreement, and this Agreement shall be construed as if such invalid, illegal or 
unenforceable provision or provisions had never been contained herein unless the
deletion of such provision or provisions would result in such a material change 
as to cause completion of the transactions contemplated hereby to be 
unreasonable.

      10.4.  Execution in Counterparts.  This Agreement may be executed in one 
or more counterparts, each of which shall be considered an original instrument, 
but all of which shall be considered one and the same agreement, and shall 
become binding when one or more counterparts have been signed by each of the 
parties and delivered to each of the Company, Holdings and Purchaser.

      10.5.  Governing Law.  This Agreement shall be governed by and construed 
in accordance with the laws of the State of New York, without regard to 
principles of conflicts of laws.  The parties hereby irrevocably submit to the 
jurisdiction of the courts of the State of New York and the Federal courts of 
the United States of America located in the Borough of Manhattan, the City of 
New York solely in respect of the interpretation and enforcement of the 
provisions of this Agreement and the transactions contemplated hereby and hereby
waive, and agree not to assert, as a defense in any action, suit or proceeding 
for the interpretation or enforcement hereof, that it is not subject thereto or 
that such action, suit or proceeding may not be brought or is not maintainable 
in said courts or that the venue thereof may not be appropriate or that this 
Agreement may not be enforced in or by such courts, and the parties hereto 
irrevocably agree that all claims with respect to such action or proceeding 
shall be heard and determined in such courts.  The parties consent to and grant 
any such court jurisdiction over the person of such parties and over the subject
matter of such dispute and agree that mailing of process or other papers in 
connection with any such action or proceeding in the manner provided in Section 
10.2 or in such other manner as may be permitted by law shall be valid and 
sufficient service thereof.

      10.6.  Assignment; Successors and Assigns.  Neither this Agreement nor any
of the rights, interests or obligations hereunder shall be assigned by any of 
the parties hereto without the prior written consent of the other parties except
that Purchaser may assign its rights (but not its obligations) under this 
Agreement to any direct or indirect Subsidiary of Purchaser.  Subject to the 
foregoing, this Agreement shall be binding upon and inure to the benefit of the 
parties hereto and their respective successors or assigns, heirs, legatees, 
distributees, executors, administrators and guardians.  Nothing in this 
Agreement, expressed or implied, is intended or shall be construed upon any 
Person (other than the parties hereto and the successors and assigns permitted 
by this Section 10.6, the officers and directors of Holdings and the Company and
their respective heirs, legatees and personal representatives with respect to 
Section 6.6) any right, remedy or claim under or by reason of this Agreement.

      10.7.  Titles and Headings.  Titles and headings to sections herein are 
inserted for convenience of reference only and are not intended to be a part of 
or to affect the meaning or interpretation of this Agreement.
10.8.  Schedules and Exhibits.  The schedules and exhibits referred to in this 
Agreement shall be construed with and as an integral part of this Agreement to 
the same extent as if the same had been set forth verbatim herein.  Except as 
expressly set forth herein, disclosure of any fact or item in any schedule 
hereto shall, to the extent apparent from the face of such schedule and relevant
to any other schedule or schedules, be deemed to be disclosed in such other 
schedule or schedules, notwithstanding the lack of a specific cross-reference.

      10.9.  Knowledge.  In each provision of this Agreement in which a 
representation or warranty is qualified to the "knowledge" of a Person or to the
"best of the knowledge" of a person, unless otherwise stated in such provision, 
each such phrase means that the Person does not have actual knowledge after due 
investigation thereof of any state of facts which is different from the facts 
described in the warranty or representation.  With respect to Holdings and the 
Company, such knowledge shall refer solely to the "knowledge" of one or more of 
those Persons identified in Schedule 10.9.  In Article III of this Agreement 
where a representation or warranty is qualified to the "actual knowledge" of a 
Person each such phrase means that the Person does not have actual knowledge of 
any state of facts which is different from the facts described in the warranty 
or representation.  With respect to Holdings and the Company, such actual 
knowledge shall refer solely to the "actual knowledge" of one or more of those 
Persons identified in Schedule 10.9.

      10.10.  Entire Agreement; Amendments.  This Agreement, including the 
schedules and exhibits, contains the entire understanding of the parties hereto 
with regard to the subject matter contained herein.  The parties hereto, by 
mutual agreement in writing, may amend, modify and supplement this Agreement.  
Any such agreement shall be validly and sufficiently authorized for purposes of 
this Agreement if it is signed by Purchaser and Holdings, the Company and 
Sellers.  Any purported amendment that does not comply with the foregoing shall 
be null and void.

      10.11.  Waivers.  Any term or provision of this Agreement may be waived, 
or the time for its performance may be extended, by the party or parties 
entitled to the benefit thereof.  The failure of any party hereto to enforce at 
any time any provision of this Agreement shall not be construed to be a waiver 
of such provision, nor in any way to affect the validity of this Agreement or 
any part hereof or the right of any party thereafter to enforce each and every 
such provision.  No waiver of any breach of this Agreement shall be held to 
constitute a waiver of any other or subsequent breach.

      10.12.  Waiver of Jury Trial.  Each party acknowledges and agrees that any
controversy which may arise under this Agreement is likely to involve 
complicated and difficult issues, and therefore each such party hereby 
irrevocably and unconditionally waives any right such party may have to a trial 
by jury in respect of any litigation directly or indirectly arising out of or 
relating to this Agreement or the transactions contemplated hereby.  Each party 
certifies and acknowledges that (i) no representative, agent or attorney of any 
other party has represented, expressly or otherwise, that such other party would
not, in the event of litigation, seek to enforce the foregoing waiver, (ii) each
party understands and has considered the implications of this waiver, (iii) each
party makes this waiver voluntarily, and (iv) each party has been induced to 
enter into this agreement by, among other things, the mutual waivers and 
certifications in this Section 10.12.

      10.13.  Expenses.  Each party hereto will bear all expenses incurred by it
in connection with this Agreement and the transactions contemplated hereby.


                                       [Signatures on next page]

      IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be 
executed as of the day and year first above written.


J SAINSBURY PLC                        STAR MARKETS COMPANY, INC.,
                                        a Massachusetts corporation


By: /s/_____________________           By:  /s/_____________________
----------------------------------          ------------------------------
    Name: David Bremner                     Name:
    Title: Deputy Group Chief Executive     Title:


                                       STAR MARKETS HOLDINGS, INC.,
                                        a Massachusetts corporation


                                       By:  /s/_____________________
                                            ------------------------------
                                            Name:
                                            Title:


BALLET LIMITED, a Caymen Islands       DENARY LIMITED, a Caymen Islands
 Company                                Company


By: /s/___________________             By:  /s/___________________
    ------------------------------          ------------------------------
    Name: Investcorp Management             Name: Investcorp Management
          Services Limited                        Services Limited
    Title: Authorized Representative        Title: Authorized Representative


GLEAM LIMITED, a Caymen Islands        HIGHLANDS LIMITED, a Caymen Islands
 Company                                 Company


By: /s/___________________             By:  /s/___________________
    ------------------------------          ------------------------------
    Name: Investcorp Management             Name: Investcorp Management
           Services Limited                        Services Limited 
    Title: Authorized Representative        Title: Authorized Representative 


NOBLE LIMITED, a Caymen Islands        OUTRIGGER LIMITED, a Caymen Islands 
 Company                                 Company


By: /s/___________________             By:  /s/___________________
    ------------------------------          ------------------------------
    Name: Investcorp Management             Name: Investcorp Management
           Services Limited                        Services Limited
    Title: Authorized Representative        Title: Authorized Representative 


QUILL LIMITED, a Caymen Islands        RADIAL LIMITED, a Caymen Islands
 Company                                Company


By: /s/___________________              By:  /s/___________________
    ------------------------------           -----------------------------
    Name: Investcorp Management             Name: Investcorp Management
           Services Limited                        Services Limited
    Title: Authorized Representative        Title: Authorized Representative 


SHORELINE LIMITED, a Caymen Islands    ZINNIA LIMITED, a Caymen Islands
 Company                                Company


By: /s/___________________             By:  /s/___________________
    ------------------------------          ------------------------------
    Name: Investcorp Management             Name: Investcorp Management
           Services Limited                        Services Limited 
    Title: Authorized Representative        Title: Authorized Representative 


INVESTCORP INVESTMENT EQUITY
 LIMITED, A Caymen Islands Company


By: /s/___________________
    ------------------------------
    Name: The Director Ltd.
    Title: Director


NA982850.067/25+