Panera Bread Company (NASDAQ:PNRA) Files An 8-K Entry into a Material Definitive Agreement

Item1.01.

On April4, 2017, Panera Bread Company, a Delaware corporation
(the Company or Panera), entered into an Agreement and Plan of
Merger (the Merger Agreement) with Rye Parent, Corp., a Delaware
corporation (Parent), Rye Merger Sub, Inc., a Delaware
corporation and a wholly owned subsidiary of Parent (Merger Sub),
and JAB Holdings B.V., a private limited liability company
incorporated under the laws of the Netherlands (JAB), providing
for the merger of Merger Sub with and into the Company (the
Merger), with the Company surviving the Merger as a wholly owned
subsidiary of Parent. Subject to the terms and conditions of the
Merger Agreement, at the effective time of the Merger (the
Effective Time), each issued and outstanding share of (i)Class A
common stock, with a par value of $0.0001 per share, of the
Company (the Class A Common Stock), and (ii)Class B common stock,
with a par value of $0.0001 per share, of the Company (the Class
B Common Stock, and, together with the ClassA Common Stock, the
Common Stock), except for certain excluded shares, will be
automatically cancelled and converted into the right to receive
$315.00 in cash (the Merger Consideration).

In addition, subject to the terms and conditions of the Merger
Agreement, at the Effective Time, (a)each outstanding stock
option and stock appreciation right of the Company will
accelerate and will be converted into the right to receive a cash
amount based on the spread, if any, between the Merger
Consideration and the exercise price payable per share under such
stock option or stock appreciation right, as applicable, (b)each
outstanding restricted share of the Company will accelerate and
receive the same treatment as the Common Stock, in each case,
paid as soon as reasonably practicable after the Effective Time,
net of any applicable withholding taxes. In addition, each
outstanding performance award of the Company will be cancelled
and converted into the right to receive a cash amount based on
the greater of target and actual performance determined through
the Effective Time, to be paid as follows: (i)a pro-rata portion
of each performance award will be paid as soon as reasonably
practicable after the Effective Time; and (ii)the remaining
portion of each performance award will be paid on the earlier of
the date on which such performance award was originally scheduled
to vest (subject to the holders continued employment with the
Company or any of its affiliates through such date), and the
holders termination of employment without cause or resignation
for good reason, in each case, net of any applicable withholding
taxes.

Consummation of the Merger is subject to the satisfaction or
waiver of specified closing conditions, including (i)the adoption
of the Merger Agreement by the affirmative vote of the holders of
a majority of the voting power of the shares of Common Stock
issued and outstanding and entitled to vote at a meeting of the
Companys stockholders, (ii)the expiration or termination of the
applicable waiting period under the Hart-Scott-Rodino Antitrust
Improvements Act of 1976, and (iii)other customary closing
conditions, including (a)the absence of any law, order, or
pending action by a governmental entity prohibiting or seeking to
prohibit the Merger or the other transactions contemplated by the
Merger Agreement, (b)the accuracy of each partys representations
and warranties (subject to customary materiality qualifiers),
(c)each partys performance of its obligations and covenants
contained in the Merger Agreement and (d)as a condition to
Parents obligation to close the merger, the absence of any
Material Adverse Effect (as defined in the Merger Agreement) on
the Company.

The Merger Agreement also contains customary representations,
warranties and covenants of the Company, Parent, JAB and Merger
Sub. The Company has also made certain covenants in the Merger
Agreement, including covenants regarding the operation of the
business of the Company and its subsidiaries prior to the
Effective Time of the Merger. The Company has also agreed to a
customary non-solicitation covenant in the Merger Agreement
prohibiting the Company from (a)soliciting, providing non-public
information or engaging or participating in any discussions or
negotiations concerning proposals relating to alternative
business combination transactions, or (b)entering into an
acquisition agreement in connection with such an alternative
business combination transaction, in each case, except as
permitted under the Merger Agreement (including a customary
exception for the Companys board of directors to consider certain
unsolicited proposals relating to alternative business
combination transactions received prior to the adoption of the
Merger Agreement by the Companys stockholders, but subject to
Parents right to match, or otherwise propose amendments to its
transaction in response to, any such acquisition proposal during
a specified notice period).

The Merger Agreement may be terminated by each of the Company and
Parent under certain circumstances, including if the Merger is
not consummated by October4, 2017 (provided that no party may
terminate the Merger Agreement if such partys breach primarily
contributed to the failure of a condition to consummate the
Merger by such date). The Merger Agreement also provides for
certain other customary termination rights for the Company and
Parent, and further provides that a termination fee in the amount
of $215 million will be payable by the Company to Parent in
connection with the termination of the Merger Agreement under
certain specified circumstances, including if the Company
terminates the Merger Agreement in order to accept a superior
proposal for an alternative business combination transaction and
enters into an acquisition agreement related to such superior
proposal.

The representations, warranties and covenants of each of the
Company, JAB, Parent, and Merger Sub contained in the Merger
Agreement have been made solely for the benefit of the parties to
the Merger Agreement. In addition, such representations,
warranties and covenants (i)have been made only for purposes of
the Merger Agreement, (ii)have been qualified by confidential
disclosures made by the parties in connection with the Merger
Agreement, (iii)are subject to materiality qualifications
contained in the Merger Agreement which may differ from what may
be viewed as material by investors, (iv)were made only as of the
date of the Merger Agreement or such other date as is specified
in the Merger Agreement and (v)have been included in the Merger
Agreement for the purpose of allocating risk between the
contracting parties rather than establishing matters as facts.
Accordingly, the Merger Agreement is included with this filing
only to provide investors with information regarding the terms of
the Merger Agreement, and not to provide investors with any other
factual information regarding the parties or their respective
businesses. Investors should not rely on the representations,
warranties and covenants or any descriptions thereof as
characterizations of the actual state of facts or condition of
the parties or any of its subsidiaries or affiliates. Moreover,
information concerning the subject matter of the representations
and warranties may change after the date of the Merger Agreement,
which subsequent information may or may not be fully reflected in
the public disclosures by the parties or their subsidiaries. The
Merger Agreement should not be read alone, but should instead be
read in conjunction with the other information regarding the
parties that is or will be contained in, or incorporated by
reference into, the Forms10-K, Forms 10-Q and other documents
that the parties file with the Securities and Exchange Commission
(SEC).

The foregoing summary of the Merger Agreement and the
transactions contemplated thereby does not purport to be complete
and is subject to, and qualified in its entirety by, the full
text of the Merger Agreement attached hereto as Exhibit 2.1 and
incorporated herein by reference.

Ronald M. Shaich, the Companys Founder, Chairman and Chief
Executive Officer, and certain stockholders of the Company
affiliated with Mr.Shaich (including entities for which Domenic
Colasacco, a director of the Company, serves as a trustee or
manager) (collectively with Mr.Shaich, the Shaich Holders), have
entered into a voting agreement with Parent and Merger Sub (the
Voting Agreement) to which the Shaich Holders have agreed to,
among other things, vote in favor of the adoption of the Merger
Agreement and the transactions contemplated by the Merger
Agreement. The Shaich Holders have the power to vote in the
aggregate approximately 15.5% of the voting power of the shares
of Common Stock issued and outstanding.

The foregoing summary of the Voting Agreement does not purport to
be complete and is subject to, and qualified in its entirety by,
the full text of the Voting Agreement attached hereto as Exhibit
99.1 and incorporated herein by reference.

On April4, 2017, in connection with the Merger, the Company
entered into a Non-Competition Agreement with Mr.Shaich (the
Non-Competition Agreement). The Non-Competition Agreement
restricts Mr.Shaich, for a period of one year following his
termination of employment with the Company for any reason, from
engaging in competitive activities against the Company and from
soliciting the Companys employees, contractors, consultants,
catering customers or franchisees. As consideration for the
non-competition and non-solicitation covenants, Mr.Shaich will
receive a lump sum payment of $7 million upon the closing of the
Merger, which Mr.Shaich will be required to repay to the Company
if he violates the covenants during the one year restricted
period. The Non-Competition Agreement also provides that
Mr.Shaich will be entitled to receive a lump sum payment equal to
three times the sum of his base salary and target annual
incentive bonus upon his termination by the Company without cause
or by Mr.Shaich for good reason, each as defined in the
Non-Competition Agreement (a

qualifying termination), or, if later, upon the second
anniversary of the Closing. Upon a qualifying termination,
Mr.Shaich will also be eligible to receive a pro-rated portion of
his annual incentive bonus based on actual performance and paid
at the time such bonuses are paid to similarly situated employees
and 18 months of continued medical insurance coverage.

The foregoing description of the Non-Competition Agreement is
qualified in its entirety by reference to the full text of the
Non-Competition Agreement attached hereto as Exhibit 10.1 and
incorporated herein by reference.

Additional Information and Where to Find It

This communication relates to the proposed Merger involving
Panera, Parent, Merger Sub, and JAB. In connection with the
proposed Merger, Panera and Parent intend to file relevant
materials with the SEC, including Paneras proxy statement on
Schedule14A (the Proxy Statement). This communication does not
constitute an offer to sell or the solicitation of an offer to
buy any securities or a solicitation of any vote or approval, and
is not a substitute for the Proxy Statement or any other document
that Panera may file with the SEC or send to its stockholders in
connection with the proposed Merger. STOCKHOLDERS OF PANERA ARE
URGED TO READ ALL RELEVANT DOCUMENTS FILED WITH THE SEC,
INCLUDING THE PROXY STATEMENT, BECAUSE THEY WILL CONTAIN
IMPORTANT INFORMATION ABOUT THE PROPOSED TRANSACTION. Investors
and security holders will be able to obtain the documents free of
charge at the SECs web site, http://www.sec.gov and Panera
stockholders will receive information at an appropriate time on
how to obtain transaction-related documents for free from Panera.

Participants in the Solicitation

Panera, Parent and their respective directors and executive
officers may be deemed to be participants in the solicitation of
proxies from the holders of Common Stock in respect of the
proposed Merger. Information about the directors and executive
officers of Panera is set forth in the proxy statement for
Paneras 2016 Annual Meeting of stockholders, which was filed with
the SEC on April15, 2016, and in Paneras Annual Report on Form
10-K for the fiscal year ended December27, 2016, which was filed
with the SEC on February22, 2017. Other information regarding the
participants in the proxy solicitation and a description of their
direct and indirect interests, by security holdings or otherwise,
will be contained in the Proxy Statement and other relevant
materials to be filed with the SEC in respect of the proposed
transaction when they become available.

Cautionary Statements Regarding Forward-Looking
Information

Certain statements contained in this communication and in our
public disclosures, whether written or oral, relating to future
events or our future performance, including any discussion,
expressed or implied, regarding our anticipated growth, operating
results, future earnings per share, plans, objectives, the impact
of our investments in sales-building initiatives and operational
capabilities on future sales and earnings, contain
forward-looking statements within the meaning of Section27A of
the Securities Act of 1933, as amended, and Section21E of the
Securities Exchange Act of 1934, as amended. These statements are
often identified by the words believe, positioned, estimate,
project, target, plan, goal, assumption, continue, intend,
expect, future, anticipate, and other similar expressions,
whether in the negative or the affirmative, that are not
statements of historical fact.

These forward-looking statements are not guarantees of future
performance and involve certain risks, uncertainties, and
assumptions that are difficult to predict, and you should not
place undue reliance on our forward-looking statements. Our
actual results and timing of certain events could differ
materially from those anticipated in these forward-looking
statements as a result of certain factors, including, but not
limited to: the risk that Paneras shareholders do not approve the
Merger; uncertainties as to the timing of the Merger; the
conditions to the completion of the Merger may not be satisfied,
or the regulatory approvals required for the Merger may not be
obtained on the terms expected or on the anticipated schedule;
the parties ability to meet expectations regarding the timing,
completion and accounting and tax treatments of the Merger; the
occurrence of any event, change or other circumstance that could
give rise to the termination of the Merger Agreement; the effect
of the announcement or pendency of the Merger on Paneras business
relationships, operating results, and business

generally; risks that the Merger disrupts current plans and
operations of Panera and potential difficulties in Paneras
employee retention as a result of the Merger; risks related to
diverting managements attention from Paneras ongoing business
operations; the outcome of any legal proceedings that may be
instituted against Panera related to the Merger Agreement or the
Merger; the amount of the costs, fees, expenses and other charges
related to the Merger; and other factors discussed from time to
time in our reports filed with the Securities and Exchange
Commission, including our Annual Report on Form 10-K for the
fiscal year ended December27, 2016. All forward-looking
statements and the internal projections and beliefs upon which we
base our expectations included in this release are made only as
of the date of this release and may change. While we may elect to
update forward-looking statements at some point in the future, we
expressly disclaim any obligation to update any forward-looking
statements, whether as a result of new information, future
events, or otherwise. Readers are cautioned not to place undue
reliance on these forward-looking statements that speak only as
of the date hereof.

About Panera Bread Company (NASDAQ:PNRA)

Panera Bread Company (Panera) is a food service provider. Panera is a national bakery-cafe concept with approximately 1,970 Company-owned and franchise-operated bakery-cafe locations in over 45 states, the District of Columbia, and Ontario, Canada. The Company operates through three segments: Company Bakery-Cafe Operations, Franchise Operations, and Fresh Dough and Other Product Operations. The Company’s menu groups are daily baked goods, including a range of freshly baked bagels, breads, muffins, scones, rolls, and sweet goods, made-to-order sandwiches on freshly baked breads, soups, freshly prepared and hand-tossed salads, pasta dishes, and roasted coffees and cafe beverages, such as hot or cold espresso and cappuccino drinks and smoothies. The Company offers Panera Catering, a catering service that provides breakfast assortments, sandwiches, salads, soups, pasta dishes, drinks, and bakery items.

Panera Bread Company (NASDAQ:PNRA) Recent Trading Information

Panera Bread Company (NASDAQ:PNRA) closed its last trading session up +38.94 at 312.94 with 2,391,523 shares trading hands.