JOHN DIXON RETIRES AS PRESIDENT OF PENN TRAFFIC.

SYRACUSE, N.Y.--(BUSINESS WIRE)--August 30, 1996--

Syracuse, New York based food company begins search for new President

and Chief Executive Officer

The Penn Traffic Company today announced that John T. Dixon is retiring as its President and Chief Executive Officer for personal and health reasons on September 30, 1996.

Penn Traffic, one of the leading food retailers in the eastern United States, also reported that it was engaging an executive recruiting firm in a national search to identify and evaluate the best candidate to succeed Dixon. Gary D. Hirsch, Penn Traffic's Chairman of the Board, will assume Mr. Dixon's responsibilities during the search process.

"Everyone at Penn Traffic will miss John's hard work and clear thinking," said Mr. Hirsch.

"Over the past 18 months, our Company has been through some adversity, as we adjust to changing industry dynamics. John has been a leader in implementing the strategies we are pursuing to improve our company. We will continue our roll-out of programs to improve customer service and merchandising practices, standardize processes company-wide and contain operating costs. John helped to start these programs, and his past efforts will contribute to Penn Traffic's future successes," Mr. Hirsch said.

"After nearly 40 years in the supermarket business working for Penn Traffic and its divisions, my fondest memories will be the many close, personal friendships I have made," said Mr. Dixon. "I want to thank every associate of Penn Traffic for their help and support during our association."

Mr. Dixon, 56, has been President and Chief Executive Officer of Penn Traffic since January 1995. He served as President of the P&C division of Penn Traffic from 1993-1995, and President of the Quality Markets division from 1992-1993. Mr. Dixon joined Big Bear, Inc., in 1957, and held various positions at Big Bear both before and after Penn Traffic purchased Big Bear in 1989.

The presidents of Penn Traffic's divisions will report directly to Mr. Hirsch during the search for a new President and CEO. "We have begun what will be a careful and exhaustive search, but we hope to have a new president on board as soon as possible," said Mr. Hirsch.

The Penn Traffic Company operates 267 supermarkets in Pennsylvania, upstate New York, Ohio and West Virginia under the "Big Bear," "Big Bear Plus," "Bi-Lo Foods," "Insalaco's," "P&C Foods," "Quality Markets" and "Riverside Markets" trade names. Penn Traffic also operates wholesale food distribution businesses serving 111 licensed franchises and 119 independent operators.

CONTACT: Gary D. Hirsch

Chairman of the Board

914-921-3000

or

Martin A. Fox

Vice Chairman - Finance

914-921-3000