GROCERY OUTLET HOLDING CORP.
January 7, 2020
S. MacGregor Read, Jr.
The purpose of this letter agreement (this Agreement) is to reflect the mutually agreed upon terms governing your transition from an executive role with Grocery Outlet Holding Corp. (f/k/a Globe Holding Corp., the Company) to a non-executive role. We look forward to your continued involvement with the Company.
1. Role Transition; Board Role. Effective as of April 1, 2020 (the Transition Date), you will resign from your position as Vice Chairman of the Company, at which point your employment relationship with the Company and its subsidiaries will end. However, you will remain a member of the Companys Board of Directors (the Board) and, effective as of the Transition Date, you will transition (the Transition) to the non-executive role of Vice Chairman of the Board.
Except as otherwise set forth in this Agreement, effective as of the Transition Date, you will be compensated in the same manner as other non-employee members of the Board pursuant to the Companys non-employee director compensation policy, as in effect from time to time (presently, an annual cash retainer of $75,000 and an annual restricted stock unit award with a grant date fair value of $100,000). In addition, while you remain Vice Chairman of the Board, you will receive an additional annual cash retainer of $100,000. For purposes of 2020, Board fees will be calculated without proration so as to include 2020 Board service occurring prior to the Transition Date. To the extent that you become a member of any committee of the Board, you will be entitled to such additional compensation as may be provided for by the non-employee director compensation policy for a committee membership.
2. Outstanding Option Awards. The Company and you acknowledge and agree that as of the date hereof, pursuant to (i) the Option Grant Notice and Agreement under the Grocery Outlet Holding Corp. 2019 Incentive Plan (the 2019 Plan), dated as of June 19, 2019, between you and the Company (the IPO Option Agreement), you hold 210,450 Options (as defined in the 2019 Plan), all of which are unvested, (ii) the Time Vesting Stock Option Grant Notice and Agreement under the Globe Holding Corp. 2014 Stock Incentive Plan (the 2014 Plan), dated as of October 21, 2014, between you and the Company (as amended, the Time Option Agreement), you hold 1,007,614 Options (as defined in the 2014 Plan), all of which are vested and (iii) the Performance Vesting Stock Option Grant Notice and Agreement under the 2014 Plan, dated as of October 21, 2014, between you and the Company (as amended, the Performance Option Agreement, and, together with the IPO Option Agreement, the Time Option Agreement, the 2019 Plan, and the 2014 Plan, the Option Documents), you hold 1,357,614 Options (as defined in the 2014 Plan), all of which are unvested.
Solely for purposes of the Option Documents, the Transition shall not constitute a Termination (as defined in the 2019 Plan) or a termination of your Employment (as defined in the 2014 Plan), as applicable, and you will continue to vest in the Options based upon your continued service as a member of the Board, and with such Termination, or termination of Employment, as applicable, occurring upon your cessation of service on the Board.