Sample Business Contracts

Separation Agreement - Safeway Inc. and Richard W. Dreiling

                              SEPARATION AGREEMENT

         DREILING, as used herein, refers to Richard W. Dreiling, and his
marital community, heirs, executors, administrators and assigns.

         SAFEWAY, as used herein, refers to Safeway Inc., and its successors and
assigns, subsidiaries, divisions, directors, officers, managers, agents and
employees, and each of them.

         WHEREAS Dreiling and Safeway desire to terminate their employment
relationship on mutually agreeable terms, as set forth in this Separation
Agreement ("Agreement"); and

         WHEREAS Safeway desires to acknowledge Dreiling's contributions to the
company during the course of his employment; and

         WHEREAS Dreiling desires to compromise, settle and fully release any
and all claims which he may have against Safeway related in any way to his
employment with Safeway, any term or condition of that employment, or the
termination of that employment;

         NOW THEREFORE, Dreiling and Safeway freely and voluntarily enter into
and execute this Agreement in consideration of the following terms and

         A.       Leave of Absence. Except as provided in Paragraph F, below,
Dreiling will be on leave of absence from January 5, 2003 through and including
May 30, 2006. During the period from January 5, 2003 through January 2, 2004,
Safeway will pay to Dreiling, in weekly installments payable in accordance with
normal Company payroll cycles, severance in the gross amount of $10,350 per week
(equivalent to $538,200 per year, Dreiling's current base salary), less tax
withholdings and authorized deductions. In consideration of Dreiling's work in
connection with Safeway's plan for 2003, Safeway will pay to Dreiling the
greater of (a) 75%, or (b) such other amount determined by Safeway in the
ordinary course, of his maximum bonus for the year 2003, such amount to be paid
in 52 weekly installments from January 2, 2004 through December 31, 2004.
Dreiling may elect to have such weekly payments mailed to his home address or
direct-deposited to his bank. For services rendered in 2002, Dreiling shall be
eligible for a bonus equal to the maximum percentage bonus payment, if any,
which Safeway may hereafter elect to make under the bonus plan applicable to
Dreiling as an Executive Vice President; said bonus, if any, to be paid in March
of 2003. Dreiling shall not be paid a bonus for work performed in any year
thereafter except as set forth in this Paragraph.

         B.       Vacation. On or about January 5, 2003, Dreiling shall be paid
for all accrued vacation benefits earned, but unused, up to that time and shall
thereafter cease to accrue any vacation benefits.



                                                          EXHIBIT 10(iii).24

         C.       Benefits. During the leave of absence period provided for in
Paragraph A, above, Dreiling's retirement, 401(k), group health (i.e. medical,
dental, orthodontia and vision) and stock option coverages will remain in
effect, on the same terms and conditions on which such coverages are made
available to salaried Safeway employees, including Dreiling's payment of any
premiums, deductibles or co-payments allocable to him as a benefit plan
participant. After December 31, 2004, Dreiling shall make direct payments to
Safeway for his employee benefit contributions. Dreiling's right to continued
group health plan coverage after the effective date of his resignation of
employment in accordance with Paragraph 1, below, shall be governed by COBRA.
Releasor will no longer be eligible for active participation in the life
insurance or Long-Term Disability plans as of January 31, 2003.

         D.       Outplacement. At Safeway's expense, Dreiling will be eligible
for a 12-month, executive level outplacement assistance program through the Lee
Hecht Harrison firm.

         E.       New Employment. Dreiling's leave of absence shall end
immediately upon Dreiling's commencement of employment with an employer other
than Safeway. Upon such commencement of employment, (1) Dreiling shall cease
employment with Safeway; (2) Safeway shall pay to Dreiling in a lump sum any
remaining amounts payable to Dreiling under Paragraph A, above (unless
Dreiling's new employment is as described in Paragraph F, below); (3) Dreiling's
coverage under all Safeway benefit plans or programs shall cease, subject to
COBRA, including any further retirement plan accruals; and (4) Dreiling's stock
option participation and vesting shall cease, triggering Dreiling's obligation
to exercise any vested stock options within 90 days. Dreiling agrees promptly
(within 5 days or less) to notify Safeway if he commences any new employment or
undertakes any activity that would result in the termination of his leave of
absence in accordance with this Paragraph.

         F.       Termination of Payments. Dreiling's entitlement to any weekly
payment under Paragraph A, and/or any lump sum payment under Paragraph E, of
this Agreement shall end, and Safeway shall have no further obligations to
Dreiling, immediately upon Dreiling's commencement of employment with, or
undertaking to provide any paid or unpaid consulting services to, any person or
entity, other than Safeway, that is engaged in or is preparing to engage in the
food and/or drug retailing business, and that competes directly or indirectly
with Safeway in any geographical location regardless of whether that is the
geographical location in which Dreiling is assigned to work.

         G.       Relocation Benefits. In the event that Dreiling commences new
employment (unless Dreiling's new employment is as described in Paragraph F,
above) prior to the termination of his leave of absence, Safeway shall provide
Dreiling with the benefits of Safeway Relocation Policy Level 1 - Movement of
Household Goods, provided that such benefits are not provided by Dreiling's new

         In consideration of the foregoing, Dreiling agrees as follows:



                                                          EXHIBIT 10(iii).24

         1.       Resignation. Dreiling agrees to, and hereby does, resign his
position as an officer of Safeway effective January 5, 2003. Dreiling further
agrees to, and hereby does, resign his Safeway employment effective the earlier
of: (a) the date on which Dreiling's leave of absence ends in accordance with
Paragraph E of this Agreement; or (b) May 30, 2006.

         2.       Release of Claims. Dreiling hereby releases and forever
discharges Safeway of and from any and all claims, demands, actions, causes of
action, damages and liabilities (all hereinafter referred to as "claims"),
whether or not now known, suspected or claimed, which Releasor ever had, now
has, or may hereafter claim to have had against Safeway, relating in any way to
his employment with Safeway, or any status, term or condition of such employment
or the termination of that employment. This release of claims is expressly
intended to, and does, extend to and include, but is not limited to, claims
under: Title VII of the Civil Rights Act of 1964, as amended; the Equal Pay Act,
as amended; the Fair Labor Standards Act, as amended; the Age Discrimination in
Employment Act of 1967, as amended; the Americans With Disabilities Act, as
amended; the Employee Retirement Income Security Act, as amended; the Older
Workers Benefit Protection Act, as amended; the California Fair Employment and
Housing Act, as amended; the California Labor Code; and any other federal, state
or local statutes, ordinances or regulations prohibiting any form or forms of
discrimination in employment and/or relating to the payment of wages and
benefits. This release also extends to and includes, but is not limited to, any
claims by Dreiling for: breach of any express or implied written or oral
contract; intentional or negligent infliction of emotional distress; impairment
or interference with economic activities or opportunities; unlawful interference
with employment rights; defamation; wrongful termination; wrongful discharge in
violation of public policy; breach of any express or implied covenant of good
faith and fair dealing; and any and all other common law contract and/or tort

         3.       Covenant Not to Sue. Dreiling covenants and agrees never,
individually or with any other person or in any way, voluntarily to commence,
aid in any way, prosecute or cause or permit to be commenced or prosecuted
against Safeway any action or other proceeding based upon any claim which is
covered by this Agreement.

         4.       Sole Right to Claims. Dreiling represents and warrants that no
other person had or has any interest in the claims referred to in this
Agreement; that he has the sole right and exclusive authority to execute this
Agreement; and that he has not sold, assigned, transferred, conveyed or
otherwise disposed of any claim or demand relating to any matter covered by this

         5.       No Admission of Liability. Dreiling acknowledges and
understands that the consideration referred to herein is provided without
admission or concession by Safeway of any violation of any law or liability to
Dreiling; that said consideration satisfies and fully extinguishes any
obligations owed to him by Safeway under any prior contract or agreement, and



                                                          EXHIBIT 10(iii).24

that said consideration provides him with valuable benefits in addition to any
to which he already is entitled under Safeway's employee benefit plans or

         6.       Release of Unknown Claims. Dreiling expressly waives any right
or benefit available in any capacity under the provisions of Section 1542 of the
California Civil Code, which section provides:


         7.       No Other Consideration. Dreiling acknowledges and agrees that
no consideration other than as provided for in this Agreement has been or will
be paid or furnished by Safeway; that he will make no claim and hereby waives
any right he may now have or may hereafter have, based upon any alleged oral
alteration, amendment, modification or any other alleged change in this
Agreement; and that Dreiling understands and has freely and voluntarily entered
into and executed this Agreement.

         8.       Dreiling's Rights. Releasor understands and agrees that:

                  a.       he has a period of twenty-one (21) days to consider
                           this Agreement and determine whether he wishes to
                           execute the same;

                  b.       any rights or claims that may arise after the date of
                           this Agreement are not waived by his execution of the

                  c.       he is advised carefully to consider the terms of this
                           Agreement and to consult with an attorney of his
                           choice before signing this Agreement;

                  d.       he has a period of seven (7) days after his execution
                           of the Agreement within which he may revoke the
                           Agreement and that the Agreement shall not become
                           effective or enforceable until the seven-day
                           revocation period has expired; and

                  e.       in the event that Dreiling fails timely to execute
                           this Agreement and return the executed original
                           thereof to Safeway, or if Dreiling timely exercises
                           the right of revocation provided for in Paragraph
                           8(d), above, then Safeway shall be relieved of any
                           and all obligations to Dreiling under this Agreement.

         9.       Confidential Information. Dreiling covenants and agrees that,
without the express written consent of an executive officer of Safeway, he will
not at any time reveal any confidential



                                                          EXHIBIT 10(iii).24

or proprietary information about Safeway obtained during the course of his
employment with Safeway.

         10.      Cooperation in Lawsuits. Dreiling covenants and agrees that he
will cooperate fully when and as reasonably required by Safeway in the defense
or prosecution of any claims, charges, complaints or lawsuits that have been or
may hereafter be filed by or against Safeway, in which event Safeway will
indemnify Dreiling in the same manner and to the same extent as he if were still
employed by Safeway. Such cooperation will include, but is not limited to,
meeting with Safeway's counsel and being available for deposition and/or trial
testimony upon reasonable notice. Safeway agrees to reimburse Dreiling for
reasonable expenses incurred by him in furnishing such cooperation.

         11.      Injunctive Relief. Dreiling understands and agrees that a
breach of any of the covenants set forth in paragraphs 3, 9 and 10, above, shall
be a material breach of the Agreement, for which Safeway may, at its sole
option: i) immediately cease providing to Dreiling any of the benefits provided
for in this Agreement; and/or ii) seek injunctive relief, damages, attorneys'
fees and costs.

Dated: January 6, 2003                      /s/ Richard W. Dreiling
                                            Richard W. Dreiling

Dated: January 6, 2003                      Safeway Inc.

                                            /s/ Robert A. Gordon
                                            By: Robert A. Gordon

                                            Its: Senior Vice President &
                                                 General Counsel