Form 4: Darden Restaurants CFO Rajesh Vennam Earns Double Target Performance Stock Units

Darden Restaurants' SVP and CFO, Rajesh Vennam, has earned 14,570 performance restricted stock units (PSUs), doubling the target award, based on the achievement of strong performance criteria.

Summary

• Rajesh Vennam, SVP and CFO of Darden Restaurants Inc. (DRI), reported changes in his beneficial ownership of company securities.
• On June 17, 2025, the Compensation Committee of the Board of Directors determined that 14,570 Performance Restricted Stock Units (PSUs) were earned by Mr. Vennam.
• These PSUs were originally awarded on July 27, 2022, with a target of 7,285 units.
• The earning of these units was based on the achievement of specific performance criteria, primarily relative total shareholder return compared to a selected comparison group, over the period from July 27, 2022, to May 25, 2025.
• The earned PSUs convert into common stock on a one-for-one basis and will vest in two equal annual installments, with the first installment beginning on July 27, 2025.
• Following this transaction, Mr. Vennam directly beneficially owns 10,335.158 shares of Common Stock, which includes shares acquired through the Employee Stock Purchase Plan and dividend reinvestment, and 14,570 Performance Restricted Stock Units.

Sentiment

Score: 8

Explanation: The document reports the earning of performance-based equity awards at double the target amount, indicating strong company performance against set criteria. This is a positive signal regarding the company's recent operational and market performance and aligns executive incentives with shareholder value.

Positives

• The earning of 14,570 PSUs, which is double the target award of 7,285 units, indicates strong performance by Darden Restaurants relative to its peers over the performance period (July 27, 2022, to May 25, 2025).
• This significant award aligns the financial interests of the CFO directly with shareholder value creation, incentivizing continued strong performance.
• The successful achievement of performance criteria demonstrates the effectiveness of the company's performance-based compensation structure for its executives.

Future Outlook

The document indicates that the earned PSUs will vest in two equal annual installments beginning on July 27, 2025, with an expiration date of July 27, 2026. This structure aims to maintain executive alignment with the company's long-term performance and shareholder value creation.

Management Comments

• "On June 17, 2025, the Compensation Committee of the Board of Directors determined the final results under the applicable performance criteria resulting in 14,570 PSUs being earned in accordance with the provisions of the applicable award agreement."
• "This grant vests in two equal annual installments beginning on July 27, 2025."

Industry Context

The earning of performance-based equity awards is a common and widely accepted practice in the restaurant and broader consumer discretionary industry. The fact that Darden Restaurants' CFO earned double the target award suggests the company's relative total shareholder return significantly outperformed its selected comparison group, indicating strong operational execution or favorable market positioning within the industry during the performance period.

Comparison to Industry Standards

• The use of Performance Restricted Stock Units (PSUs) tied to relative total shareholder return (TSR) is a standard executive compensation mechanism across various industries, including the restaurant sector, designed to align executive incentives with shareholder interests.
• While specific comparable companies or projects are not detailed in this filing, the achievement of double the target award (14,570 PSUs earned versus 7,285 target) indicates that Darden Restaurants' TSR performance from July 27, 2022, to May 25, 2025, was exceptionally strong compared to its peer group, suggesting a high level of shareholder value creation relative to competitors.

Corporate Governance

Related Party Transactions

• The earning of Performance Restricted Stock Units by Rajesh Vennam, SVP and CFO, constitutes a related party transaction as it involves compensation to a key executive of the company.

Stakeholder Impact

• **Shareholders**: The significant earning of PSUs, reflecting strong relative total shareholder return, is positive for existing shareholders as it indicates successful value creation and aligns executive incentives with shareholder interests.
• **Management**: Rajesh Vennam directly benefits from the earned PSUs, increasing his equity stake and reinforcing his long-term commitment and alignment with the company's strategic goals.
• **Employees**: While not directly impacting all employees, the strong performance leading to this executive award could reflect overall company success, potentially boosting morale and confidence in leadership.

Next Steps

• The earned PSUs will begin vesting in two equal annual installments starting on July 27, 2025.
• The final vesting of these PSUs is expected by July 27, 2026.

Key Dates

Keywords

Darden Restaurants, DRI, Rajesh Vennam, SVP CFO, Performance Restricted Stock Units, PSUs, Executive Compensation, Insider Trading, SEC Form 4, Stock Award, Shareholder Return, Corporate Governance