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11Jan2013

Delhaize America Makes Structural & Leadership Changes

This memo from Delhaize America president Roland Smith outlines plans for structural and leadership changes at the Delhaize America Leadership Team.

Dear Associates,

It has been six weeks since I communicated with you regarding the structure of the Delhaize America Leadership Team (DALT), the formation of the Strategic Task Force (STF), and the possible consolidation of Support Services. In my note, I committed to communicating the next level of structural changes within the first six weeks of 2013.

I’m pleased to relay that we are ahead of schedule and today I want to share with you additional structural and leadership changes the DALT has made at the Officer level, update you on the progress made by the STF, and clarify my expectations for consolidation of Support Services.

Officer Structure
In the summer of 2012, Delhaize America initiated a Strategic Cost Program in an effort to significantly reduce SG&A costs. The intent was to bring the ratio of SG&A to revenue in line with market standards and reinvest those savings in our banners to improve our customers’ experience and drive revenue. Despite best intentions and efforts, our cost-saving targets were not achieved.

Accordingly, over the past six weeks, the DALT has worked diligently to build a DA Officer structure that is both effective at achieving our goals and as efficient as possible. Through intensive workshops and significant collaboration, each DALT member has worked to develop the structures and teams they need in order to serve their customers, grow our businesses, and create shareholder value.

Our new structure includes 50 Officers, which represents almost a 25 percent reduction, and is a balance of position creation, position elimination, and some positions remaining the same. The following Officers were carefully selected for their roles, whether the position is new or represents continuity. I hope you’ll join me in congratulating them on their success and supporting them in their roles, which are effective immediately:

Strategy and Development
Reporting to Chief Strategy and Development Officer David Criscione, located in Salisbury:

· David Hilse, Vice President, Strategy, Delhaize America, located in Salisbury
· Kyle Mitchell, Vice President, Store Development, Delhaize America, located in Salisbury

Human Resources
As I mentioned in my last message, we are conducting a search for a new Chief People Officer. We have made progress with recruitment, but have yet to make a final decision. In the meantime, Hannaford and Sweetbay President Brad Wise will serve the organization in both his new position and his previous role as Senior Vice President of Human Resources. Reporting to the new CPO, who will be located in Salisbury:

· Tracy Stone, Vice President, Associate Relations, Delhaize America, located in Salisbury
· Dave Bass, Vice President, Compensation and Associate Wellness, Delhaize America, located in Salisbury

Finance
Reporting to Chief Financial Officer Greg Amoroso, located in Salisbury:

· Tom Kelly, Vice President, Controller, Delhaize America, located in Salisbury
· Lionel Desclee, Vice President, Finance, Delhaize America, located in Salisbury

Supply Chain
Reporting to Chief Supply Chain Officer Mike Vail, located in Salisbury:

· Tod Pepin, Senior Vice President, Center Store Merchandising, Delhaize America, located in Salisbury
o Tim Jacques, Vice President, Center Store Merchandising, Delhaize America, will report to Tod and will be located in Salisbury
· Geoff Waldau, Senior Vice President, Fresh Merchandising, Delhaize America, located in Salisbury
o Mark Messier, Vice President, Fresh Merchandising, will report to Geoff and be located in Salisbury
· Chris Lewis, Vice President, Supply Chain Services and Solutions, Delhaize America, located in Scarborough
· Gerry Greenleaf, Vice President, Distribution and Transportation, Delhaize America, located in Scarborough
· Attila Akat, Senior Vice President, Our Brands, Delhaize America, is joining the organization and will be located in Salisbury
· Mike Cantrell, Vice President, Pharmacy, Delhaize America, recently joined the organization and is located in Scarborough

Food Lion, Harveys and Reid’s
Reporting to President Beth Newlands Campbell, located in Salisbury:

· JJ Fleeman, Vice President, Strategy and Business Development, Food Lion, located in Salisbury
· Karen Fernald, Senior Vice President, Merchandising, Food Lion, located in Salisbury; reporting to Karen are:
o Paul LaCroix, Vice President, Pricing, Food Lion, located in Salisbury
o John Barnette, Vice President, Center Store Merchandising, Food Lion, located in Salisbury
o Peter Vail, Vice President, Fresh Merchandising, Food Lion, located in Salisbury
· Greg Finchum, Senior Vice President, Retail Operations, Food Lion, located in Salisbury; reporting to Greg are:
o Rick LaCroix, Vice President, Retail Services, Food Lion, located in Salisbury
o John Garlick, Vice President, Northern Division, Food Lion, located in Salisbury
o Troy Leshko, Vice President, Central Division, Food Lion, located in Salisbury
o Kevin Hill, Vice President, Southern Division, Food Lion, located in Salisbury
· Marci Grebstein, Vice President, Marketing, Food Lion, located in Salisbury
· Barry Robinson, Vice President, Harveys and Reid’s, located in Nashville, Georgia

Hannaford and Sweetbay
Reporting to President Brad Wise, located in Scarborough:

· Peter Forester, Vice President, Strategy and Business Development, Hannaford and Sweetbay, located in Scarborough
· Rick Meyerkopf, Vice President, Merchandising, Hannaford and Sweetbay, located in Scarborough
· Mary Wright, Vice President, Marketing, Hannaford and Sweetbay, located in Scarborough
· Bob Schools, Senior Vice President, Retail Operations, Hannaford, located in Scarborough; reporting to Bob are:
o Heather Paquette, Vice President, Eastern Division, Hannaford, located in Scarborough
o Rudy DiPietro, Vice President, Western Division, Hannaford, located in Schodack, N.Y.
· Eddie Garcia, Vice President, Retail Operations, Sweetbay, located in Tampa

Bottom Dollar Food
Reporting to President Meg Ham, located in Salisbury:

· Gene Faller, Vice President, Retail Operations, Bottom Dollar Food, located in Salisbury
· Jason Wilson, Vice President, Strategy and Business Development, Bottom Dollar Food, located in Salisbury
· Hans Lefebvre, Vice President, Merchandising, Bottom Dollar Food, located in Salisbury

Information Technology/Info Security
Reporting to Chief Information Officer Deb Dixson, located in Salisbury:

· Odile Ducatez, Vice President, Global IT Business Office, Delhaize America, located in Salisbury
· Nathalie Haddad, Vice President, Solutions Delivery, Delhaize America, located in Salisbury
· Eric Norden, Vice President, Global IT Infrastructure, Delhaize America, located in Salisbury
· John Kirkwood, Vice President, Chief Information Security Officer, Delhaize Group, located in Salisbury

Legal
Reporting to Senior Vice President of Legal and Government Affairs Linn Evans, located in Salisbury:

· Teross Young, Vice President, Government Relations, Delhaize America, located in Salisbury

Departures
Developing the new Officer structure required a great number of difficult decisions that led to the departure of many longtime, well-respected leaders. The following Officers are departing the organization effective Friday, Jan. 11:

· Pete Bonneau, Vice President, Center Store Merchandising, Delhaize America
· Mike Brooks, Vice President, Strategy, Delhaize America
· Jim Corby, Vice President, Produce Merchandising, Delhaize America
· Steve Culver, Vice President, Government Relations – Northeast, Delhaize America
· James Egan, Senior Vice President, Retail Operations, Food Lion
· Kristen Hanson, Vice President, Our Brands, Delhaize America
· Mike Harris, Vice President, Risk Management, Delhaize America
· Lisa Miller, Vice President, Sustainability, Delhaize America
· Kyle Price, Vice President, Produce Merchandising, Food Lion
· T.R. Robinson, Senior Vice President, Merchandising, Food Lion
· Lisa Toner, Vice President, Legal Affairs, Delhaize America.

In addition, Shawn Beichler, Vice President, Real Estate, Delhaize America, Steve Campbell, Vice President, Organizational Development, Learning, and Internal Brand and Communication, Delhaize America, Bonnie Moore, Vice President, Associate Relations, Food Lion and Eric Watson, Vice President, Diversity and Inclusion, Delhaize America, will depart the organization in mid-March after a transition period.

Please join me in thanking these leaders for their significant contributions to Delhaize America and wishing them well in their future endeavors.

Strategic Task Force
Under the leadership of David Criscione, a small group of STF members have been working hard along with the DALT to develop a Delhaize America Vision, establish operating principles, and define critical priorities for 2013. We are expanding the STF and it now includes:

· Greg Amoroso, Chief Financial Officer, Delhaize America
· Lionel Desclee, Vice President, Financial Planning & Analysis, Delhaize America
· David Hilse, Vice President, Strategy and Business Development, Delhaize America
· J.J. Fleeman, Vice President, Strategy and Business Development, Food Lion
· Peter Forester, Vice President, Strategy and Business Development, Hannaford and Sweetbay
· Jason Wilson, Vice President, Strategy and Business Development, Bottom Dollar Food
· Tracy Stone, Vice President, Associate Relations, Delhaize America
· Odile Ducatez, Vice President, Global IT Business Office, Delhaize America
· Michael Hoar, Director, Critical Initiatives, Delhaize America
· Robert Canipe, Advisor to the STF

We have made great progress to date and our new Delhaize America Vision and operating principles are nearly complete. This new Vision is meant to support, not replace, the Delhaize Group Vision. We have also made significant progress in reducing hundreds of previous “priorities” into 12 to 15 clearly defined critical priorities on which we will focus our full resources on achieving in 2013. I look forward to sharing our new Vision, operating principles, and critical priorities with you in the near future.

Consolidation of Support Services
In my last message, I relayed that my intent was to relocate my team of direct reports and a select group of key leaders to Salisbury and explore consolidating Support Services in late 2013 or early 2014. After completing the moves contemplated in this announcement, approximately 80 percent of Delhaize America Officers will be located in North Carolina.

After additional analysis and review with the DALT, I now believe that further consolidation of Support Services would result in unnecessary loss of critical talent. Accordingly, our plan is to assess the success of our new structure before making any decisions regarding consolidation.

To be clear, beyond the relocation contemplated in this announcement, if our new structure is effective in accomplishing our goals, we will not consolidate all of Support Services in Salisbury. However, if a current associate leaves Delhaize America, we will carefully consider the optimal location for his or her position before hiring a replacement.

Next Steps
Work has already begun on implementing our new structure. Over the next few weeks, the entire Officer team will focus on finalizing the remaining organizational structure and refining the business strategies necessary for us to refocus, execute, and succeed. I intend to continue to move decisively and quickly and in this respect:

· We’ll announce the organizational structure, addressing positions beyond the Officer level by mid-February.
· I’ll host a number of town hall-style meetings in late February to share our Vision, operating principles, and critical priorities, as well as provide you the opportunity to ask questions.

In the meantime, if you have any questions about your reporting structure or functional responsibilities, please contact your supervisor or the Associate Relations leader in your area.

I appreciate that this is a lot of complex and potentially emotional information to process and it has a profound and personal impact. I also understand that this represents significant change and that some of you may not agree with or fully understand the necessity for these changes. Nevertheless, I sincerely believe this new structure, team of talented Officers, and focus on clear and critical priorities will put Delhaize America back on track and we will achieve our goals in 2013 and beyond. Accordingly, I’m asking for your continued support, hard work, and commitment to excellence.

Thank you and best regards,

Roland Smith
President and Chief Executive Officer
Delhaize America