Whole Foods 2008 Annual Report Download - page 29

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Item 2. Properties.
As of September 28, 2008, we operated 275 stores: 264 stores in 38 U.S. states and the District of Columbia; six stores in
Canada; and five stores in the United Kingdom. This includes 55 stores acquired from Wild Oats Markets, Inc. on August
28, 2007: 52 stores in 20 U.S. states and three stores in Canada. We own 10 stores, three distribution facilities and land for
one store in development, including the adjacent property. We also own a store and a building on leased land, which is
leased to third parties, and have five stores in development on leased land. All other stores, distribution centers, bakehouses
and administrative facilities are leased, with expiration dates ranging from one to 35 years. We have options to renew most
of our leases in five-year increments with renewal periods ranging from five to 50 years. In addition, as of September 28,
2008, we had 36 leased properties that are not being utilized in current operations, of which 30 are related to Wild Oats, with
expiration dates ranging from one to 16 years. We are actively negotiating to sublease or terminate leases related to these
locations.
The following table shows the number of our stores by state, the District of Columbia, Canada and the United Kingdom as of
September 28, 2008:
Number Number Number
Location of Stores Location of Stores Location of Stores
Alabama 1 Kentucky 2 Ohio 6
Arkansas 1 Louisiana 3 Oklahoma 1
Arizona 7 Maine 1 Oregon 6
California 51 Maryland 7 Pennsylvania 7
Canada 6 Massachusetts 19 Rhode Island 3
Colorado 18 Michigan 5 South Carolina 2
Connecticut 5 Minnesota 2 Tennessee 3
District of Columbia 3 Missouri 3 Texas 14
Florida 14 Nebraska 1 United Kingdom 5
Georgia 7 Nevada 4 Utah 4
Hawaii 1 New Jersey 9 Virginia 9
Illinois 16 New Mexico 5 Washington 5
Indiana 2 New York 8 Wisconsin 2
Kansas 2 North Carolina 5
Item 3. Legal Proceedings.
From time to time we are a party to legal proceedings including matters involving personnel and employment issues,
personal injury, intellectual property, real estate and other proceedings arising in the ordinary course of business. The
Company has established loss provisions for matters in which losses are probable and the amount of loss can be reasonably
estimated. The Company does not believe that any of these proceedings arising in the ordinary course of business, either
alone or in the aggregate, will have a material adverse effect on the Company’s results of operations, cash flows or financial
condition.
The Federal Trade Commission (“FTC”) has resumed its administrative action challenging the Company’s August 28, 2007
acquisition of Wild Oats Markets. On July 29, 2008, the United States Court of Appeals for the District of Columbia Circuit
reversed the August 16, 2007 decision of the United States District Court for the District of Columbia which had denied the
FTC’s motion for a preliminary injunction against the acquisition of Wild Oats Markets by Whole Foods Market, and
remanded the case to the District Court for further proceedings consistent with the appellate decision. On the same day, the
Court of Appeals issued an Order directing the Clerk of the Court of Appeals to withhold issuance of the mandate in the case
until seven days after disposition of any timely petition for rehearing or petition for rehearing en banc. On August 26, 2008,
Whole Foods Market filed a petition for a rehearing en banc with the Court of Appeals, to which the Court of Appeals
ordered the FTC to respond. The FTC opposed the petition. Subsequent to year end, on October 6, 2008, Whole Foods
Market filed a motion for leave to file a reply to the FTC's opposition to the petition for rehearing en banc, which motion the
FTC also opposed. On November 21, 2008 the Court of Appeals denied Whole Foods Market's petition for a rehearing en
banc, amended its earlier opinion and remanded the case to the District Court for further proceedings. On remand the FTC
may renew its motion for some preliminary injunctive relief pending resolution of the administrative action.
On August 8, 2008, the FTC issued an Order rescinding the stay of its administrative proceeding against Whole Foods
Market. The FTC had previously filed a complaint commencing its administrative proceeding on June 28, 2007 but had
stayed the proceeding on its own motion pending resolution of the federal court proceedings related to the merger. On