0000095521 svu:CorporateMember 2009-03-01 2009-06-20 0000095521 svu:CorporateMember 2008-02-24 2008-06-14 0000095521 2008-02-24 2009-02-28 0000095521 2008-06-14 0000095521 2008-02-23 0000095521 2009-06-20 0000095521 2009-02-28 0000095521 svu:SupplyChainServicesMember 2009-03-01 2009-06-20 0000095521 svu:RetailFoodMember 2009-03-01 2009-06-20 0000095521 svu:SupplyChainServicesMember 2008-02-24 2008-06-14 0000095521 svu:RetailFoodMember 2008-02-24 2008-06-14 0000095521 2008-02-24 2008-06-14 0000095521 2008-09-05 0000095521 2009-07-24 0000095521 2009-03-01 2009-06-20 iso4217:USD xbrli:shares xbrli:pure xbrli:shares iso4217:USD  <html> <head></head> <body>  <div style="font-family: 'Times New Roman',Times,serif"> <div align="center" style="font-size: 10pt; margin-top: 0pt"><b></b></div> <div align="left"> </div>  <div align="Center" style="font-size: 10pt; margin-top: 0pt"><b></b></div> <div align="Center" style="font-size: 10pt; margin-top: 0pt"><b></b></div> <div align="Center" style="font-size: 10pt; margin-top: 0pt"><b></b></div> <div align="left" style="font-size: 10pt; margin-top: 12pt"><b>NOTE 1 — THE COMPANY AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES</b> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt"><i>Business Description</i> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">SUPERVALU INC. (“SUPERVALU” or the “Company”), a Delaware corporation, was organized in 1925 as the successor of two wholesale grocery firms established in the 1870’s. SUPERVALU is one of the largest companies in the United States grocery channel. References to the Company refer to SUPERVALU INC. and Subsidiaries. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The Company conducts its retail operations throughout the United States under three retail food store formats: combination stores (defined as food and pharmacy), food stores and limited assortment food stores. Additionally, the Company provides supply chain services, primarily wholesale distribution, across the United States retail grocery channel. </div> <div align="left" style="font-size: 10pt; margin-top: 12pt"><i>Statement of Registrant</i> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The accompanying condensed consolidated financial statements of the Company for the 16 weeks ended June 20, 2009 and June 14, 2008 are unaudited and, in the opinion of management, contain all adjustments that are of a normal and recurring nature necessary to present fairly the financial condition and results of operations for such periods. The condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and related notes in the Company’s Annual Report on Form 10-K for the fiscal year ended February 28, 2009. The results of operations for the 16 weeks ended June 20, 2009 are not necessarily indicative of the results expected for the full year. The Condensed Consolidated Balance Sheet as of February 28, 2009 has been derived from the audited Consolidated Balance Sheet as of that date. </div> <div align="left" style="font-size: 10pt; margin-top: 12pt"><i>Accounting Policies</i> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The summary of significant accounting policies is included in the Notes to Consolidated Financial Statements set forth in the Company’s Annual Report on Form 10-K for the fiscal year ended February 28, 2009. </div> <div align="left" style="font-size: 10pt; margin-top: 12pt"><i>Fiscal Year</i> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The Company’s fiscal year ends on the last Saturday in February. The Company’s first quarter consists of 16 weeks, while the second, third and fourth quarters each consist of 12 weeks, except for the fourth quarter of fiscal 2009 which included 13 weeks. Because of differences in the accounting calendars of the Company and its wholly-owned subsidiary, New Albertson’s, Inc., the accompanying June 20, 2009 and February 28, 2009 Condensed Consolidated Balance Sheets include the assets and liabilities related to New Albertsons, Inc. as of June 18, 2009 and February 26, 2009, respectively. </div> <div align="left" style="font-size: 10pt; margin-top: 12pt"><i>Use of Estimates</i> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The preparation of the Company’s condensed consolidated financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. </div> <div align="left" style="font-size: 10pt; margin-top: 12pt"><i>Cash and Cash Equivalents</i> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The Company considers all highly liquid investments with a maturity of three months or less at the time of purchase to be cash equivalents. The Company’s banking arrangements allow the Company to fund outstanding checks when presented to the financial institution for payment, resulting in book overdrafts. Book overdrafts are recorded in Accounts payable and accrued liabilities in the Condensed Consolidated Balance Sheets and are reflected as an operating activity in the Condensed Consolidated Statements of Cash Flows. As of June 20, 2009 and February 28, 2009, the Company had net book overdrafts of $352 and $389, respectively. </div>   </div>  <div style="font-family: 'Times New Roman',Times,serif"> <div align="left" style="font-size: 10pt; margin-top: 12pt"><i>Net Earnings Per Share</i> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">Basic net earnings per share is calculated using net earnings available to common stockholders divided by the weighted average number of shares outstanding during the period. Diluted net earnings per share is similar to basic net earnings per share except that the weighted average number of shares outstanding is after giving effect to the dilutive impacts of stock options, restricted stock awards and other dilutive securities. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The following table reflects the calculation of basic and diluted net earnings per share: </div> <div align="center"> <table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">  <tr valign="bottom"> <td width="76%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="5%"> </td> <td width="1%"> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="6" style="border-bottom: 1px solid #000000"><b>First Quarter Ended</b></td> <td> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2"><b>June 20,</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2"><b>June 14,</b></td> <td> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>2009</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>2008</b></td> <td> </td> </tr>   <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Net earnings per share—basic </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px">Net earnings available to common stockholders </div></td> <td> </td> <td align="left">$</td> <td align="right">113</td> <td> </td> <td> </td> <td align="left">$</td> <td align="right">162</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:30px; text-indent:-15px">Weighted average shares outstanding—basic </div></td> <td> </td> <td> </td> <td align="right">212</td> <td> </td> <td> </td> <td> </td> <td align="right">212</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px">Net earnings per share—basic </div></td> <td> </td> <td align="left">$</td> <td align="right">0.53</td> <td> </td> <td> </td> <td align="left">$</td> <td align="right">0.76</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Net earnings per share—diluted </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px">Net earnings available to common stockholders </div></td> <td> </td> <td align="left">$</td> <td align="right">113</td> <td> </td> <td> </td> <td align="left">$</td> <td align="right">162</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:30px; text-indent:-15px">Weighted average shares outstanding—basic </div></td> <td> </td> <td> </td> <td align="right">212</td> <td> </td> <td> </td> <td> </td> <td align="right">212</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px">Dilutive impact of options and restricted stock outstanding </div></td> <td> </td> <td> </td> <td align="right">—</td> <td> </td> <td> </td> <td> </td> <td align="right">2</td> <td> </td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td> </td> <td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:30px; text-indent:-15px">Weighted average shares outstanding—diluted </div></td> <td> </td> <td> </td> <td align="right">212</td> <td> </td> <td> </td> <td> </td> <td align="right">214</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px">Net earnings per share—diluted </div></td> <td> </td> <td align="left">$</td> <td align="right">0.53</td> <td> </td> <td> </td> <td align="left">$</td> <td align="right">0.76</td> <td> </td> </tr>  </table> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">Options to purchase 22 and 13 shares of common stock were outstanding during the 16 weeks ended June 20, 2009 and June 14, 2008, respectively, but were excluded from the computation of diluted earnings per share because they were antidilutive. </div> <div align="left" style="font-size: 10pt; margin-top: 12pt"><i>Comprehensive Income</i> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">Comprehensive income consisted of the following: </div> <div align="center"> <table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">  <tr valign="bottom"> <td width="76%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="5%"> </td> <td width="1%"> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="6" style="border-bottom: 1px solid #000000"><b>First Quarter Ended</b></td> <td> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2"><b>June 20,</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2"><b>June 14,</b></td> <td> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>2009</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>2008</b></td> <td> </td> </tr>   <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Net earnings </div></td> <td> </td> <td align="left">$</td> <td align="right">113</td> <td> </td> <td> </td> <td align="left">$</td> <td align="right">162</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px">Pension and other postretirement activity, net of tax </div></td> <td> </td> <td> </td> <td align="right">5</td> <td> </td> <td> </td> <td> </td> <td align="right">—</td> <td> </td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td> </td> <td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Comprehensive income </div></td> <td> </td> <td align="left">$</td> <td align="right">118</td> <td> </td> <td> </td> <td align="left">$</td> <td align="right">162</td> <td> </td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td> </td> <td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td> <td> </td> </tr>  </table> </div> <div align="left" style="font-size: 10pt; margin-top: 12pt"><i>Subsequent Events</i> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">Events that have occurred subsequent to June 20, 2009 have been evaluated through July 29, 2009, the date the Company filed this Quarterly Report on Form 10-Q with the Securities and Exchange Commission. </div> </div> </body> </html>

<html> <head></head> <body>  <div style="font-family: 'Times New Roman',Times,serif"> <div align="left" style="font-size: 10pt; margin-top: 12pt"><b>NOTE 2 — NEW ACCOUNTING STANDARDS</b> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">In December 2008, the Financial Accounting Standards Board (“FASB”) issued FASB Staff Position (“FSP”) FAS 132(R)-1, “Employers’ Disclosures about Postretirement Benefit Plan Assets.” FSP FAS 132(R)-1 provides additional guidance regarding disclosures about plan assets of defined benefit pension or other postretirement plans. FSP FAS 132(R)-1 will be effective for the Company’s fiscal year ending February 27, 2010. The adoption of FSP FAS 132(R)-1 will result in enhanced disclosures, but will not otherwise have an impact on the Company’s consolidated financial statements. </div>   </div>  <div style="font-family: 'Times New Roman',Times,serif"> </div> </body> </html>

<html> <head></head> <body>  <div style="font-family: 'Times New Roman',Times,serif"> <div align="left" style="font-size: 10pt; margin-top: 12pt"><b>NOTE 6 — LONG-TERM DEBT</b> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The Company’s long-term debt and capital lease obligations consisted of the following: </div> <div align="center"> <table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">  <tr valign="bottom"> <td width="76%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="5%"> </td> <td width="1%"> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2"><b>June 20,</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2"><b>February 28,</b></td> <td> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>2009</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>2009</b></td> <td> </td> </tr>   <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">1.19% to 3.25% Revolving Credit Facility and Variable Rate Notes due June 2011 – June 2012 </div></td> <td> </td> <td align="left">$</td> <td align="right">1,617</td> <td> </td> <td> </td> <td align="left">$</td> <td align="right">1,920</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">8.00% Notes due May 2016 </div></td> <td> </td> <td> </td> <td align="right">1,000</td> <td> </td> <td> </td> <td> </td> <td align="right">—</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">7.50% Notes due February 2011 </div></td> <td> </td> <td> </td> <td align="right">700</td> <td> </td> <td> </td> <td> </td> <td align="right">700</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">7.45% Debentures due August 2029 </div></td> <td> </td> <td> </td> <td align="right">650</td> <td> </td> <td> </td> <td> </td> <td align="right">650</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">7.50% Notes due November 2014 </div></td> <td> </td> <td> </td> <td align="right">500</td> <td> </td> <td> </td> <td> </td> <td align="right">500</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">6.34% to 7.15% Medium Term Notes due July 2009 – June 2028 </div></td> <td> </td> <td> </td> <td align="right">452</td> <td> </td> <td> </td> <td> </td> <td align="right">512</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">8.00% Debentures due May 2031 </div></td> <td> </td> <td> </td> <td align="right">400</td> <td> </td> <td> </td> <td> </td> <td align="right">400</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">7.50% Notes due May 2012 </div></td> <td> </td> <td> </td> <td align="right">300</td> <td> </td> <td> </td> <td> </td> <td align="right">300</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">8.00% Debentures due June 2026 </div></td> <td> </td> <td> </td> <td align="right">272</td> <td> </td> <td> </td> <td> </td> <td align="right">272</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">8.70% Debentures due May 2030 </div></td> <td> </td> <td> </td> <td align="right">225</td> <td> </td> <td> </td> <td> </td> <td align="right">225</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">7.75% Debentures due June 2026 </div></td> <td> </td> <td> </td> <td align="right">200</td> <td> </td> <td> </td> <td> </td> <td align="right">200</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">7.25% Notes due May 2013 </div></td> <td> </td> <td> </td> <td align="right">200</td> <td> </td> <td> </td> <td> </td> <td align="right">200</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">6.95% Notes due August 2009 </div></td> <td> </td> <td> </td> <td align="right">173</td> <td> </td> <td> </td> <td> </td> <td align="right">350</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">8.35% Notes due May 2010 </div></td> <td> </td> <td> </td> <td align="right">165</td> <td> </td> <td> </td> <td> </td> <td align="right">275</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">7.875% Notes due August 2009 </div></td> <td> </td> <td> </td> <td align="right">118</td> <td> </td> <td> </td> <td> </td> <td align="right">350</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">7.90% Debentures due May 2017 </div></td> <td> </td> <td> </td> <td align="right">96</td> <td> </td> <td> </td> <td> </td> <td align="right">96</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">7.50% Debentures due May 2037 </div></td> <td> </td> <td> </td> <td align="right">—</td> <td> </td> <td> </td> <td> </td> <td align="right">191</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Accounts Receivable Securitization Facility, currently 1.41% </div></td> <td> </td> <td> </td> <td align="right">125</td> <td> </td> <td> </td> <td> </td> <td align="right">120</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Other </div></td> <td> </td> <td> </td> <td align="right">90</td> <td> </td> <td> </td> <td> </td> <td align="right">97</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Net discount on debt, using an effective interest rate of 6.28% to 8.97% </div></td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(240</td> <td nowrap="nowrap">)</td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(208</td> <td nowrap="nowrap">)</td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Capital lease obligations </div></td> <td> </td> <td> </td> <td align="right">1,319</td> <td> </td> <td> </td> <td> </td> <td align="right">1,334</td> <td> </td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td> </td> <td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Total debt and capital lease obligations </div></td> <td> </td> <td> </td> <td align="right">8,362</td> <td> </td> <td> </td> <td> </td> <td align="right">8,484</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Less current maturities of long-term debt and capital lease obligations </div></td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(257</td> <td nowrap="nowrap">)</td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(516</td> <td nowrap="nowrap">)</td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td> </td> <td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Long-term debt and capital lease obligations </div></td> <td> </td> <td align="left">$</td> <td align="right">8,105</td> <td> </td> <td> </td> <td align="left">$</td> <td align="right">7,968</td> <td> </td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td> </td> <td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td> <td> </td> </tr>  </table> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">Certain of the Company’s credit facilities and long-term debt agreements have restrictive covenants and cross-default provisions which generally provide, subject to the Company’s right to cure, for the acceleration of payments due in the event of a breach of the covenant or a default in the payment of a specified amount of indebtedness due under certain other debt agreements. The Company was in compliance with all such covenants and provisions for all periods presented. </div>   </div>  <div style="font-family: 'Times New Roman',Times,serif"> <div align="left" style="font-size: 10pt; margin-top: 6pt">In May 2009, the Company issued $1,000 in senior notes, which rank equally with all of the Company’s other senior unsecured indebtedness. In conjunction with the debt issuance, the Company paid off $191 of 7.50% Debentures due May 2037 that contained put options exercised in May 2009, early redeemed $60 of 6.77% Medium Term Notes due July 2009 and purchased pursuant to a tender offer $232 of 7.875% Notes due August 2009, $177 of 6.95% Notes due August 2009 and $110 of 8.35% Notes due May 2010 for an aggregate payment of $777 in cash. The remainder of the debt issuance proceeds was used to reduce the Revolving Credit Facility. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">In May 2009, the Company amended and extended its 364-day accounts receivable securitization program. The Company can borrow up to $200 on a revolving basis, with borrowings secured by eligible accounts receivable, which remain under the Company’s control. Facility fees under this program range from 0.75 percent to 2.50 percent, based on the Company’s credit ratings. The facility fee in effect on June 20, 2009, based on the Company’s current credit ratings, is 1.00 percent. As of June 20, 2009, there were $353 of accounts receivable pledged as collateral, classified in Receivables in the Condensed Consolidated Balance Sheet. Due to the Company’s intent to renew the facility or refinance it with the Revolving Credit Facility, the facility is classified in Long-term debt in the Condensed Consolidated Balance Sheets. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">As of June 20, 2009, the Company had $456 of debt, excluding the Accounts Receivable Securitization Facility, with current maturities that are classified in Long-term debt in the Condensed Consolidated Balance Sheets due to the Company’s intent to refinance such obligations with the Revolving Credit Facility or other long-term debt. </div> </div> </body> </html>

<html> <head></head> <body>  <div style="font-family: 'Times New Roman',Times,serif"> <div align="left" style="font-size: 10pt; margin-top: 12pt"><b>NOTE 11 — COMMITMENTS, CONTINGENCIES AND OFF-BALANCE SHEET ARRANGEMENTS</b> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The Company has guaranteed certain leases, fixture financing loans and other debt obligations of various retailers as of June 20, 2009. These guarantees were generally made to support the business growth of independent retail customers. The guarantees are generally for the entire terms of the leases or other debt obligations with remaining terms that range from less than one year to 21 years, with a weighted average remaining term of approximately 10 years. For each guarantee issued, if the independent retail customer defaults on a payment, the Company would be required to make payments under its guarantee. Generally, the guarantees are secured by indemnification agreements or personal guarantees of the independent retail customer. The Company reviews performance risk related to its guarantees of independent retail customers based on internal measures of credit performance. As of June 20, 2009, the maximum amount of undiscounted payments the Company would be required to make in the event of default of all of these guarantees was approximately $160 and represented approximately $107 on a discounted basis. Based on the indemnification agreements, personal guarantees and results of the reviews of performance risk, the Company believes the likelihood that it will be required to assume a material amount of these obligations is remote. Accordingly, no amount has been recorded in the Condensed Consolidated Balance Sheets for these contingent obligations under the Company’s guarantee arrangements. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The Company is contingently liable for leases that have been assigned to various third parties in connection with facility closings and dispositions. The Company could be required to satisfy the obligations under the leases if any of the assignees are unable to fulfill their lease obligations. Due to the wide distribution of the Company’s assignments among third parties, and various other remedies available, the Company believes the likelihood that it will be required to assume a material amount of these obligations is remote. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">In the ordinary course of business, the Company enters into supply contracts to purchase products for resale. These contracts typically include either volume commitments or fixed expiration dates, termination provisions and other standard contractual considerations. As of June 20, 2009, the Company had approximately $1,662 of non-cancelable future purchase obligations primarily related to supply contracts. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The Company is a party to a variety of contractual agreements under which the Company may be obligated to indemnify the other party for certain matters, which indemnities may be secured by operation of law or otherwise, in the ordinary course of business. These contracts primarily relate to the Company’s commercial contracts, operating leases and other real estate contracts, financial agreements, agreements to provide services to the Company and agreements to indemnify officers, directors and employees in the performance of their work. While the Company’s aggregate indemnification obligation could result in a material liability, the Company is aware of no current matter that it expects to result in a material liability. </div> <div align="left" style="font-size: 10pt; margin-top: 12pt"><i>Legal Proceedings</i> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The Company is subject to various lawsuits, claims and other legal matters that arise in the ordinary course of conducting business, none of which, in management’s opinion, is expected to have a material adverse impact on the Company’s financial condition, results of operations or cash flows. </div>   </div>  <div style="font-family: 'Times New Roman',Times,serif"> <div align="left" style="font-size: 10pt; margin-top: 6pt">In April 2000, a class action complaint was filed against Albertsons, as well as American Stores Company, American Drug Stores, Inc., Sav-on Drug Stores, Inc. (“Sav-on Drug Stores”) and Lucky Stores, Inc. (“Lucky Stores”), wholly-owned subsidiaries of Albertsons, in the Superior Court for the County of Los Angeles, California (Gardner, et al. v. American Stores Company, et al.) by assistant managers seeking recovery of overtime based on the plaintiffs’ allegation that they were improperly classified as exempt under California law. In May 2001, the Court certified a class with respect to Sav-on Drug Stores assistant managers. A case with very similar claims, involving the Sav-on Drug Stores assistant managers and operating managers, was also filed in April 2000 against Sav-on Drug Stores in the Superior Court for the County of Los Angeles, California (Rocher, Dahlin, et al. v. Sav-on Drug Stores, Inc.), and was certified as a class action in June 2001 with respect to assistant managers and operating managers. The two cases were consolidated in December 2001. New Albertsons was added as a named defendant in November 2006. Plaintiffs seek overtime wages, meal and rest break penalties, other statutory penalties, punitive damages, interest, injunctive relief and the attorneys’ fees and costs. The parties have entered into a memorandum of understanding regarding settlement of this matter and are currently negotiating terms of a preliminary settlement agreement. Although this lawsuit is subject to the uncertainties inherent in the litigation process, based on the information presently available to the Company, management does not expect that the ultimate resolution of this lawsuit will have a material adverse effect on the Company’s financial condition, results of operations or cash flows. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">In September 2008, a class action complaint was filed against the Company, as well as International Outsourcing Services, LLC (“IOS”), Inmar, Inc., Carolina Manufacturer’s Services, Inc., Carolina Coupon Clearing, Inc. and Carolina Services, in the United States District Court in the Eastern District of Wisconsin. The plaintiffs in the case are a consumer goods manufacturer, a grocery co-operative and a retailer marketing services company who allege on behalf of a purported class that the Company and the other defendants (i) conspired to restrict the markets for coupon processing services under the Sherman Act and (ii) were part of an illegal enterprise to defraud the plaintiffs under the Federal Racketeer Influenced and Corrupt Organizations Act. The plaintiffs seek monetary damages, attorneys’ fees and injunctive relief. The Company intends to vigorously defend this lawsuit, however all proceedings have been stayed in the case pending the result of the criminal prosecution of certain former officers of IOS. Although this lawsuit is subject to the uncertainties inherent in the litigation process, based on the information presently available to the Company, management does not expect that the ultimate resolution of this lawsuit will have a material adverse effect on the Company’s financial condition, results of operations or cash flows. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">In December 2008, a class action complaint was filed in the United States District Court for the Western District of Wisconsin against the Company alleging that a 2003 transaction between the Company and C&S Wholesale Grocers, Inc. (“C&S”) was a conspiracy to restrain trade and allocate markets. In the 2003 transaction, the Company purchased certain assets of the Fleming Corporation as part of Fleming Corporation’s bankruptcy proceedings and sold certain assets of the Company to C&S which were located in New England. The complaint alleges that the conspiracy was concealed and continued through the use of non-compete and non-solicitation agreements and the closing down of the distribution facilities that the Company and C&S purchased from the other. Plaintiffs are seeking monetary damages, injunctive relief and attorneys’ fees. The Company is vigorously defending this lawsuit. Although this lawsuit is subject to the uncertainties inherent in the litigation process, based on the information presently available to the Company, management does not expect that the ultimate resolution of this lawsuit will have a material adverse effect on the Company’s financial condition, results of operations or cash flows. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">In July 2009, a putative class action complaint was filed in the United States District Court for the Southern District of New York against the Company and an officer and the Executive Chairman of the Board alleging fraud under Sections 10(b) and 20(a) of the Exchange Act and SEC Rule 10b-5. The complaint alleges that the Company withheld negative information from the market by inflating its fiscal year 2010 guidance in order to complete the Company’s Note Offering which closed on May 7, 2009. The purported class period runs between April 23, 2009 and June 23, 2009. Plaintiff is seeking class certification, monetary damages and attorneys’ fees and costs. The Company intends to vigorously defend this lawsuit. Although this lawsuit is subject to the uncertainties inherent in the litigation process, based on the information presently available to the Company, management does not expect that the ultimate resolution of this lawsuit will have a material adverse effect on the Company’s financial condition, results of operations or cash flows. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The Company is also involved in routine legal proceedings incidental to its operations. Some of these routine proceedings involve class allegations, many of which are ultimately dismissed. Management does not expect that the ultimate resolution of these legal proceedings will have a material adverse effect on the Company’s financial condition, results of operations or cash flows. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The statements above reflect management’s current expectations based on the information presently available to the Company, however, predicting the outcomes of claims and litigation and estimating related costs and exposures involves substantial uncertainties that could cause actual outcomes, costs and exposures to vary materially from current expectations. In addition, the Company regularly monitors its exposure to the loss contingencies associated with these matters and may from time to time change its predictions with respect to outcomes and its estimates with respect to related costs and exposures and believes recorded reserves are adequate. It is possible, although management believes it is remote, that material differences in actual outcomes, costs and exposures relative to current predictions and estimates, or material changes in such predictions or estimates, could have a material adverse effect on the Company’s financial condition, results of operations or cash flows. </div>   </div>  <div style="font-family: 'Times New Roman',Times,serif"> <div align="left" style="font-size: 10pt; margin-top: 12pt"><i>Pension Plan / Health and Welfare Plan Contingencies</i> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The Company contributes to various multi-employer pension plans under collective bargaining agreements, primarily defined benefit pension plans. These plans generally provide retirement benefits to participants based on their service to contributing employers. Based on available information, the Company believes that some of the multi-employer plans to which it contributes are underfunded. Company contributions to these plans could increase in the near term. However, the amount of any increase or decrease in contributions will depend on a variety of factors, including the results of the Company’s collective bargaining efforts, investment returns on the assets held in the plans, actions taken by the trustees who manage the plans and requirements under the Pension Protection Act and Section 412(e) of the Internal Revenue Code. Furthermore, if the Company were to significantly reduce contributions, exit certain markets or otherwise cease making contributions to these plans, it could trigger a partial or complete withdrawal that would require the Company to fund its proportionate share of a plan’s unfunded vested benefits. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The Company also makes contributions to multi-employer health and welfare plans in amounts set forth in the related collective bargaining agreements. The majority of the Company’s collective bargaining agreements fix or limit the Company’s contributions to multi-employer health and welfare plans. The remaining agreements contain requirements that could result in additional contributions, increasing the Company’s Selling and administrative expenses in the future. </div> </div> </body> </html>

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