General Counsel Employment Agreement

April 3, 2002


John Sims 9310 Old Indian Hill Road Cincinnati, OH 45243


Dear John:


I am pleased to confirm my verbal offer of employment for the position of Executive Vice President and General Counsel for Albertson's, Inc. (the "Company"). In this assignment, you will report directly to Larry Johnston, our CEO. Your employment with the Company will commence on March 25, 2002 (the "Effective Date").


Your initial base salary ("Base Salary") will be $400,000 per annum, payable in accordance with the Company's policies relating to salaried employees. Your Base Salary may be changed by the Compensation Committee of the Board of Directors of the Company (the "Compensation Committee") in its sole discretion.


Commencing with the fiscal year of the Company ("Fiscal Year") in which the Effective Date occurs, you will have the opportunity to earn an incentive for each Fiscal Year as recommended by the Compensation Committee in accordance with the Company's annual incentive plan applicable to the Company's senior officers (the "Annual Incentive Compensation Plan"). The amount of each annual incentive shall be set by the Compensation Committee and is currently equal to seventy percent (70%) of Base Salary for the fiscal year if the applicable "target" performance goals (as defined in the Annual Bonus Plan for such period) are met (the "Target Award"), except that the award cannot exceed one hundred fifty percent (150%) of Target Award. The criteria for determining the amount of any Target Award and the bases upon which such Target Award shall be payable shall be no less favorable to you than those used for other senior executives of the Company, such criteria and bases to be determined in the sole discretion of the Compensation Committee.


As of the Effective Date, you will receive a $100,000 sign-on bonus.


As of the Effective Date, you will be granted 40,000 shares of deferrable restricted stock units of the Company ("Restricted Stock Unit Award") in accordance with the form of grant used by the Company for grants made to its senior executive officers. Such grants shall vest at twenty percent (20%) per


Mr. John Sims March 22, 2002 Page 2


year on the first, second, third, fourth, and fifth anniversaries of the Effective Date; provided in each case that you have been continuously employed as a senior executive with the Company from the Effective Date through the applicable vesting date, except as otherwise provided in this letter agreement and in such deferrable restricted stock unit agreement. To the extent that dividends are paid on Company common stock after the Effective Date and prior to the date that the Company common stock that is subject to a Restricted Stock Unit Award is issued to you, you shall be entitled to receive a cash payment in an amount equal to the dividends you would have been entitled to receive had you been the owner of such unissued shares on the date such dividends are paid. Such cash payment shall be made at the same time payment of dividends are made to other shareholders of Company common stock.


As of the Effective Date, you will be granted an option ("Initial Option") to purchase an amount equal in value to three million dollars ($3,000,000) of common stock of the Company at a per share exercise price equal to the fair market value of the co ...