EXHIBIT 99.1
                                                                   ------------

[GRAPHIC OMITTED]
[LOGO - THE PENN TRAFFIC COMPANY]

                                                                   July 5, 2006

Mr. Greg Young
40 Waterford Drive
Westfield, MA 01085

Dear Greg:

On behalf of The Penn  Traffic  Company and Bob Chapman we are pleased to offer
you the position of SVP - CHIEF MARKETING OFFICER/DISTRIBUTION. Your employment
will commence on Monday,  July 17, 2006. While this letter is not a contractual
agreement, it does contain the major elements of our offer to you.

1.   SALARY. Your starting salary will be $300,000.00 per year.

2.   SIGN-ON BONUS. $100,000.00 payable in 3 installments. First payment of 50%
     upon date you start work in Syracuse,  25% after  3-months,  and the final
     payment after 6-months.

3.   MANAGEMENT  PERFORMANCE  INCENTIVE PROGRAM (BONUS) At Plan, 45% of Base to
     Max of 90% (Penn Traffic  waives the  "pro-rata"  rule).  You have already
     been provided a copy of the Plan.

4.   RELOCATION PLAN. Enhanced Executive  Relocation Plan. As an offset to your
     company car or car allowance request, Penn Traffic will provide $15,000 to
     you after 60-days of employment for miscellaneous expenses associated with
     your relocation to Central New York.

5.   BENEFITS:

     MEDICAL, DENTAL, VISION AND PRESCRIPTION DRUG COVERAGE:  Effective on date
     of hire.

     TERM LIFE (CO. PAID)*:   After  31 days  of  continuous  service,  Company
                              paid, 1 1/2 times salary.

     SUPPLEMENTAL LIFE*:      After  31 days of  continuous  service,  Employee
                              paid 1x or 2x or 3x Salary. (Max. $650,000).

     SHORT TERM DISABILITY:   Effective  on date of hire:  Weeks 1 through  17,
                              100% of salary.  For weeks 18-26,  NYS  Statutory
                              benefits.

     LONG TERM DISABILITY:    Effective on date of hire  following  120 days of
                              disability, $5,000/mo. max. (Company paid).

     *The combined maximum for Basic and Supplemental Life is $650,000.



6.   VACATION.  Four weeks paid  vacation  each year.  Start August 1, 2007 you
     will be entitled to five (5) weeks paid vacation each year.

7.   401(K) PLAN.  Effective on date of hire. Subject to the limits required by
     law and the Plan, (a) may defer from 1-25% of salary, taxed deferred,  (b)
     Company  to match  50% of  first 3% of  employee  deferral.  In  addition,
     company to contribute 3% of your earned total  compensation as further set
     forth in Plan.

8.   PENN TRAFFIC HOLIDAYS. Per Company Plan, currently six (6),

9.   5% EMPLOYEE DISCOUNT

10.  SEVERANCE PLAN. 52 weeks of Severance.

11.  CHANGE OF CONTROL. As described in Plan Document previously provided.

12.  ANNUAL PAY AND PERFORMANCE REVIEW. Beginning of each Fiscal year.

It is important to reiterate that this letter is an offer of employment, and in
no way should be construed  to be an  employment  contract  for definite  term.
Employment at The Penn Traffic  Company is at-will,  subject to  termination by
the Company or you at any time.

We look  forward  to you  rejoining  the  Penn  Traffic  team.  If you have any
questions  regarding  this  offer  letter or the  position,  please  contact me
directly.

Sincerely,

/s/ Donald R. Bregande
-------------------------------
Donald R. Bregande
Vice President, Human Resources
The Penn Traffic Company

cc:  Bob Chapman


-------------------------------------------------------------------------------

Mr. Gregory J. Young:

                  As agreement  with the terms of this letter,  please sign one
         copy of this letter and retain the second copy for your files,  Please
         return to my attention by 12 Noon Monday, July 10, 2006

I, Gregory J. Young accept this offer on this 7th day of July, 2006.

         /s/ Gregory J. Young
----------------------------------
         (Signature)