EXHIBIT 10B

                     FRED MEYER, INC. BONUS PLAN DESCRIPTION

                         AS AMENDED TO JANUARY 31, 1998


INTRODUCTION:

          The  Fred  Meyer,  Inc.  Bonus  Plan  for  1998  compensates  selected
employees based on goals and objectives determined  periodically by the Company.
Under the Bonus Plan,  bonuses are allocated  based on programs  prescribed  for
          each of two categories of participants: (1) Regional and Store
bonusable
participants, and (2) all other bonusable participants.

REGIONAL AND STORE BONUSABLE PARTICIPANTS PROGRAM:

          Awards for regional and store bonusable participants are based upon
predetermined and preapproved objectives for store contribution income,
corporate net inventory control (inventory less payables), and corporate pretax
income. Each semi-annual period and year the Company sets objectives for sales,
contribution income, net inventory, and pretax income based upon the Company's
projections, each region/store manager's projections and historical results.
These objectives are reviewed and approved by the Company's Compensation
Committee. The actual bonus awarded each semi-annual period and for the year is
based on a predefined percentage of the participant's regular salary for the
year, as adjusted for actual versus budgeted results. Budgeted results give rise
to a target bonus, while greater than budgeted results give rise to a larger
bonus (up to 200 percent of target bonus), and lower than budgeted results will
result in a smaller bonus (as low as 0 percent of target bonus). A portion of
each participant's bonus is generally calculated on how well the participant's
area of responsibility does, and a smaller portion is based on how well the
Company does. The Company portion is capped at 200 percent and the store/region
portion is capped at 200 percent.

ALL OTHER BONUSABLE PARTICIPANTS PROGRAM:

          The program applicable to all other management/supervisory and other
bonusable participants not included in the regional and store program is based
on the following formula: The bonus paid is based on the Company's objectives
for sales, pretax


<PAGE>
income, net inventory, and various departmental budgets as prepared by the
department's management, and approved by the Compensation Committee. The bonus
amount paid is determined as a percentage of each participant's salary (target
bonus), adjusted upward or downward based on performance. Participants can
achieve a maximum of 200 percent of their target bonus for exceeding their
performance goals or a minimum of 0 percent of target bonus for lower than
predefined results. A portion of a participant's bonus is generally based on
his/her department's results, with the larger portion based on the Company's
pretax income results. Both the department and Company portion is capped at 200
percent. Eighty percent of the annual bonus payable to each executive officer at
bonus plan for corporate targeted pretax income, net inventory, operational
income, and/or departmental expense is paid in cash. The remaining twenty
percent is withheld pursuant to the Company's Capital Bonus Plan and paid in the
form of restricted shares of Company Common Stock over three years, subject to
the executive officer being an employee at the time of vesting. The shares also
vest on the retirement, death or disability of the executive officer.

YEAR-END REVIEW AND PAYMENT:

          Bonuses are generally paid in April following the year in which
performance goals are measured. The Compensation Committee approves the final
amount of total bonuses to be paid and the amount paid to executive officers
prior to such payment. The Compensation Committee of the Board of Directors can
approve discretionary amounts resulting from unusual circumstances affecting the
Company.

SUPERIOR PERFORMANCE BONUS PLAN:

          Vice Presidents, Senior Vice Presidents, Executive Vice Presidents,
the Subsidiary President and Chief Executive Officer are eligible to receive
stock bonuses based on the Company achieving superior performance levels as
approved in advance by the Compensation Committee of the Board of Directors. The
number of shares paid as a bonus, which vest one-third per year over a
three-year period, is based on the ratio of shareholder value added as a percent
of total assets. The shares are received when vested assuming the officer is an
employee at the time of vesting. The shares also vest on the retirement, death
or disability of the officer.