Safeway (SWY)

Underfunded plans

Year-end information for plans with accumulated benefit obligations in excess of plan assets (in millions):

Retirement Restoration Plan    The Retirement Restoration Plan provides death benefits and supplemental income payments for senior executives after retirement. The Company recognized expense of $4.8 million in 2007, $5.2 million in 2006 and $6.4 million in 2005. The aggregate projected benefit obligation of the Retirement Restoration Plan was approximately $62.9 million at year-end 2007 and $57.0 million at year-end 2006.

Postretirement Benefits other than Pensions    In addition to the Company’s retirement plans and the Retirement Restoration Plan benefits, the Company sponsors plans that provide postretirement medical and life insurance benefits to certain employees. Retirees share a portion of the cost of the postretirement medical plans. Safeway pays all the costs of the life insurance plans. The plans are not funded.

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SAFEWAY INC. AND SUBSIDIARIES

Notes to Consolidated Financial Statements

The Company’s accrued postretirement benefit obligation (“APBO”) was $64.6 million at year-end 2007 and $51.7 million at year-end 2006. The APBO represents the actuarial present value of the benefits expected to be paid after retirement. Postretirement benefit expense was $7.6 million in 2007, $5.5 million in 2006 and $4.2 million in 2005.

Estimated Future Benefit Payments    The following benefit payments, which reflect expected future service as appropriate, are expected to be paid (in millions):

Multi-Employer Pension Plans    Safeway participates in various multi-employer retirement plans, covering substantially all Company employees not covered under the Company’s non-contributory retirement plans, pursuant to agreements between the Company and various unions. These plans are generally defined benefit plans; however, in many cases, specific benefit levels are not negotiated with or known by the employer-contributors. Contributions of $270.1 million in 2007, $253.8 million in 2006 and $234.5 million in 2005 were made and charged to expense.

Underfunded plans