Amendment No. 3 to Form S-1 Table of Contents NEW ALBERTSON'S BUSINESS OF SUPERVALU INC. AND SUBSIDIARIES Notes to Combined Financial Statements February 21, 2013 and February 23, 2012 (Dollars in millions) contains significant judgments and estimates related to such items as the weighted average cost of capital, future revenue, profitability, cash flows and fair values of assets and liabilities. Amortization expense for intangible assets with definite useful lives of $40. $47 and $48 was recorded in fiscal 2012, 2011, and 2010. Future amortization expense will average approximately $22 per year for the next five years. NAI had unfavorable operating lease intangibles, related to certain above-market leases acquired and pushed down by Parent, of S110 and $121 as of February 21, 2013 and February 23, 2012, respectively, included as a component of Other long-term liabilities within the Combined Balance Sheets. Amortization benefit relating to these unfavorable operating leases was $11, $15 and $20 for fiscal 2012, 2011 and 2010, respectively. (4) Reserves for Closed Properties and Property, Plant and Equipment-Related Impairment Charges Reserves for Closed Properties NAI maintains reserves for costs associated with closures of retail stores, distribution centers and other properties that are no longer being utilized in current operations. NAI provides for closed property operating lease liabilities based on the present value of the remaining noncancelable lease payments after the closing date, reduced by estimated subtenant rentals that could be reasonably obtained for the property. Adjustments to closed property reserves primarily relate to changes in expected subtenant income or actual exit costs differing from original estimates. Changes in NAI's reserves for closed properties consisted of the following: 2012 2011 2010 Beginning balance $ 79 92 74 Additions 26 9 36 Payments (21) (26) (22) Adjustments 1 4 4 Ending balance $