DEF: Driven Brands Holdings Inc. Announces 2025 Annual Meeting of Stockholders and Executive Transition

Driven Brands Holdings Inc. will hold its 2025 Annual Meeting of Stockholders virtually on May 20, 2025, and Jonathan Fitzpatrick will step down as President and CEO, succeeded by Daniel Rivera.

Summary

• Driven Brands Holdings Inc. will hold its 2025 Annual Meeting of Stockholders on May 20, 2025, in a virtual-only format.
• Stockholders of record as of March 21, 2025, are entitled to vote at the meeting.
• The meeting will address the election of three Class II director nominees, an advisory vote on executive compensation, and the ratification of PricewaterhouseCoopers LLP as the independent registered public accounting firm for the fiscal year ending December 27, 2025.
• Jonathan Fitzpatrick will step down as President and CEO on May 9, 2025, and become Non-Executive Chair of the Board, with Daniel Rivera succeeding him as President and CEO.
• The company's executive compensation program is designed to align executives' pay with company performance, attract and retain talent, and align executives' interests with those of stockholders.
• The Compensation Committee adjusted the threshold and target levels initially set for the metrics down to align with updated industry expectations.
• The resulting payout percentage for Messrs. Fitzpatrick, Rivera, and OMelia was approximately 75% of their respective bonus targets.
• The 2022 PSU payouts resulted in an aggregate payout at 39% of target.
• The company's compensation policies and practices do not encourage unnecessary or excessive risk behaviors.
• The company's CEO Pay Ratio was 181 to 1.
• PricewaterhouseCoopers LLP (PwC) has served as the company's independent registered public accounting firm since 2022.
• Aggregate fees billed for professional services rendered by PwC to us for the fiscal years ended December 28, 2024, and December 30, 2023 were $4,635,000 and $3,721,500 respectively.

Sentiment

Score: 7

Explanation: The document is primarily informational, outlining the agenda for the annual meeting and changes in leadership. The tone is professional and forward-looking, with a focus on aligning executive compensation with company performance.

Positives

• The company's executive compensation program is designed to align executives' pay with company performance and stockholder interests.
• The company's compensation policies and practices do not encourage unnecessary or excessive risk behaviors.
• The company maintains stock ownership guidelines for NEOs to encourage them to maintain a significant financial stake in the company.
• The company has a clawback policy in place to recover excess incentive-based compensation in the event of accounting restatements.
• The company is dedicated to maintaining robust engagement with our stockholders, through the active involvement of our senior management and investor relations teams.

Negatives

• The 2022 PSU payouts resulted in an aggregate payout at 39% of target.
• At our 2024 Annual Meeting, approximately 78% of the votes cast voted in favor of our NEO compensation program.

Risks

• The company's future results and financial condition could be affected by a number of risks and important factors.
• Historical, current, and forward-looking sustainability-related statements may be based on standards for measuring progress that are still developing, internal controls and processes that continue to evolve, and assumptions that are subject to change in the future.

Future Outlook

The document includes forward-looking statements regarding the company's business and operations, which are subject to risks and uncertainties.

Management Comments

• Jonathan Fitzpatrick: 'Thank you for your continued support of, and interest in, Driven Brands.'

Industry Context

The document does not explicitly discuss broader industry trends, but the peer group used for compensation benchmarking includes companies in the retail, restaurant, and hospitality sectors.

Comparison to Industry Standards

• The Compensation Committee benchmarks executive compensation against a peer group including Academy Sports and Outdoors, Domino's Pizza, Papa John's International, Valvoline, Avis Budget Group, Five Below, Planet Fitness, Williams-Sonoma, Bloomin' Brands, Floor & Decor Holdings, Restaurant Brands International, Wyndham Hotels & Resorts, Choice Hotels International, Hertz Global Holdings, Texas Roadhouse, Dick's Sporting Goods, Jack in the Box, and The Wendy's Co.
• Driven Brands' positioning between the 25th and 50th percentiles of the peer group for annual revenue, and closer to the 50th percentile for system-wide sales, makes the peer group a good basis for compensation benchmarking.

Management Changes

Related Party Transactions

• The company made payments for facilities maintenance services in the aggregate amount of approximately $4 million during the year ended December 28, 2024 to Divisions Maintenance Group, an entity owned by affiliates of Roark Capital Management, LLC, which is related to our Principal Stockholders.

Stakeholder Impact

• Stockholders are invited to participate in the Annual Meeting and vote on key proposals.
• Employees will experience a change in leadership with Daniel Rivera becoming the new President and CEO.
• The company's performance and executive compensation decisions impact shareholder value.

Next Steps

• Stockholders should review the proxy materials and vote on the proposals.
• The company will hold the Annual Meeting on May 20, 2025.
• Daniel Rivera will assume the role of President and CEO on May 9, 2025.
• Jonathan Fitzpatrick will serve as a Senior Advisor to Mr. Rivera from the CEO Transition Date through the end of the 2025 fiscal year.

Key Dates

Keywords

Annual Meeting, Executive Compensation, Board of Directors, Proxy Statement, Director Election, PricewaterhouseCoopers, Driven Brands, Governance