Exhibit 10.1

 

[Whole Foods Market, Inc. Letterhead]

 

June 14, 2017

 

Keith Manbeck
c/o Whole Foods Market, Inc.
550 Bowie Street
Austin, Texas  78703

 

Re:                             Qualifying Termination Upon or Following a
Change of Control

 

Dear Keith:

 

Reference is made to the offer letter, dated May 2, 2017 (the “Offer Letter”),
by and between Whole Foods Market, Inc. (the “Company”) and you.  This letter
agreement (this “Agreement”) constitutes the “change of control agreement”
referred to in the Offer Letter:

 

Severance.  If, upon or following a Change of Control (as defined in the Whole
Foods Executive Retention Plan and Non-Compete Arrangement (the “Retention
Plan”) as in effect on the date hereof), your employment is terminated (1) by
the Company without “Cause” (as defined in the Retention Plan) or (2) by you
with “Good Reason” (as defined below) (each of clauses (1) and (2) above, a
“Qualifying Termination”), you shall be entitled to receive the following,
subject to your execution and delivery of a general release of claims in favor
of the Company and its affiliates in substantially the form attached to the
Retention Plan (and non-revocation within the time period set forth therein):

 

·                                          A lump sum cash payment equal to $2
million, payable within 30 days following the date of your Qualifying
Termination (subject to the paragraph entitled “Section 409A” below).

 

·                                          If a Qualifying Termination occurs
prior to the date on which the Company pays annual bonuses in respect of its
2017 fiscal year, an additional lump sum cash payment of $975,000; if such
Qualifying Termination occurs on or after the date on which the Company pays
annual bonuses in respect of its 2017 fiscal year but prior to the date on which
the Company pays annual bonuses in respect of its 2018 fiscal year, an
additional lump sum cash payment of $650,000; and if such Qualifying Termination
occurs on or after the date on which the Company pays annual bonuses in respect
of the 2018 fiscal year but prior to the date on which the Company pays annual
bonuses in respect of the 2019 fiscal year, an additional lump sum cash payment
of $325,000; in each case, payable within 30 days following your Qualifying
Termination (subject to the paragraph entitled “Section 409A” below).

 

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·                                          To the extent any portion of the
restricted stock award or option award granted to you pursuant to the Offer
Letter remains unvested as of a Qualifying Termination, full accelerated vesting
of such awards as of the Qualifying Termination.

 

·                                          To the extent any portion of the
$400,000 cash compensation payable under the Offer Letter in respect of equity
awards of a prior employer that you forfeited remains unpaid as of a Qualifying
Termination, a lump sum cash payment equal to such unpaid portion, payable
within 30 days following the date of the Qualifying Termination (subject to the
paragraph entitled “Section 409A” below).

 

For purposes of this Agreement, “Good Reason” has the meaning set forth in the
Retention Plan; provided, however, that, (a) notwithstanding clause (i) of such
definition, any changes in your authority, position, duties, responsibilities,
status, offices, title, or reporting requirements resulting solely the Company
ceasing to be a public company by virtue of becoming a subsidiary or division of
another public company upon and following a Change of Control shall not
constitute Good Reason, and (b) clause (ii) of such definition shall be applied
as though you were a participant in the Retention Plan as of the date of the
applicable Change of Control.

 

Section 409A.  It is intended that this Agreement shall comply with the
provisions of Section 409A of the Internal Revenue Code of 1986, as amended (the
“Code”), and the Treasury Regulations relating thereto, or an exemption to
Section 409A of the Code.  Any payments that qualify for the “short-term
deferral” exception or another exception under Section 409A of the Code shall be
paid under the applicable exception.  For purposes of the limitations on
nonqualified deferred compensation under Section 409A of the Code, each payment
of compensation under this Agreement shall be treated as a separate payment of
compensation for purposes of applying the Section 409A of the Code deferral
election rules and the exclusion under Section 409A of the Code for certain
short-term deferral amounts.  All payments to be made upon a termination of
employment under this Agreement may only be made upon a “separation from
service” under Section 409A of the Code.  In no event may you, directly or
indirectly, designate the calendar year of any payment under this Agreement. 
Notwithstanding any other provision of this Agreement to the contrary, if you
are considered a “specified employee” for purposes of Section 409A of the Code
(as determined in accordance with the methodology established by the Company as
in effect on the date of your termination of employment), any payment that
constitutes nonqualified deferred compensation within the meaning of
Section 409A of the Code that is otherwise due to you under this Agreement
during the six-month period following your separation from service (as
determined in accordance with Section 409A of the Code) on account of your
separation from service shall be accumulated and paid to you on the first
business day of the seventh month following your separation from service (the
“Delayed Payment Date”) to the extent necessary to avoid the imposition of tax
penalties under Section 409A of the Code.  You shall be entitled to interest on
any delayed cash payments from the date of termination to the Delayed Payment
Date at a rate equal to the applicable federal short-term rate in effect under
Section 1274(d) of the Code for the month in which your separation from service
occurs.  If you die during the postponement period, the amounts and entitlements
delayed on account of Section 409A of the Code shall be paid to the personal

 

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representative of your estate on the first to occur of the Delayed Payment Date
or 30 calendar days after the date of your death.

 

Miscellaneous.  This Agreement may not be amended or modified except by an
agreement in writing signed by you and the Company.  This Agreement shall be
binding upon any successor of the Company or its businesses (whether direct or
indirect, by purchase, merger, consolidation, or otherwise), in the same manner
and to the same extent that the Company would be obligated under this Agreement
if no succession had taken place.  The term “Company,” as used in this letter,
shall mean the Company as defined above and any successor or assignee to the
business or assets that by reason hereof becomes bound by this letter.  This
letter shall be governed by, and construed in accordance with, the laws of the
State of Texas without reference to conflict of law rules.

 

*         *         *

 

We appreciate and value your dedicated service to the Company.  If you have any
questions, please feel free to contact me.

 

[Signature Page Follows]

 

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Please confirm your agreement to the foregoing by executing this Agreement as
indicated below.

 

 

Sincerely,

 

 

 

WHOLE FOODS MARKET, INC.

 

 

 

 

 

 

By:

/s/ John Mackey

 

 

Name:

John Mackey

 

 

Title:

Chief Executive Officer

 

 

 

 

Acknowledged and Agreed:

 

 

 

 

 

 

/s/ Keith Manbeck

 

 

Keith Manbeck

 

 

[Signature Page to Change of Control Letter Agreement]

 

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