Safeway (SWY)

7.5 Litigation; Adverse Facts.

Except as set forth in Company’s Annual Report on SEC Form 10-K for its fiscal year ended January 1, 2005 and Company’s 2004 Annual Report to Stockholders or any SEC Form 10-Q or 8-K filed with the SEC prior to the Closing Date, there are no actions, suits, proceedings, arbitrations or governmental investigations (whether or not purportedly on behalf of Company or any of its Subsidiaries) at law or in equity or before or by any Governmental Authority, pending or, to the knowledge of Company, threatened against or affecting Company or any of its Subsidiaries or any property of Company or any of its Subsidiaries that, individually or in the aggregate, would reasonably be expected to result in a Material Adverse Effect. Neither Company nor any of its Subsidiaries is (i) in violation of any applicable laws that, individually or in the aggregate, would reasonably be expected to result in a Material Adverse Effect or

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(ii) subject to or in default with respect to any final judgments, writs, injunctions, decrees, rules or regulations of any court or any other Governmental Authority, that, individually or in the aggregate, would reasonably be expected to result in a Material Adverse Effect.