Form 4: Potbelly Executive's Shares Convert in RaceTrac Merger

Adiya Dixon's Potbelly shares and equity awards converted to cash and cash awards following the company's merger with RaceTrac at $17.12 per share.

Summary

• Potbelly Corp (PBPB) merged with Hero Sub Inc., a subsidiary of RaceTrac, Inc., on October 23, 2025, with Potbelly surviving as a wholly-owned subsidiary of RaceTrac.
• Adiya Dixon, SVP, CLO and Secretary of Potbelly, reported changes in her beneficial ownership due to this merger.
• Each outstanding share of Potbelly common stock was automatically cancelled and converted into the right to receive $17.12 per share in cash.
• Dixon's 155,912 shares of common stock were converted into cash at the Per Share Price of $17.12.
• Her 33,149 unvested restricted stock units (RSUs) were cancelled and substituted into contingent Substituted RSU Cash Awards, equal to the product of the Per Share Price ($17.12) and the number of shares subject to the RSU.
• Outstanding unvested performance-based restricted stock units (PSUs) (21,820, 13,953, and 16,574 units) were cancelled and substituted into contingent Substituted PSU Cash Awards, calculated based on the greater of target or actual achievement of performance metrics, multiplied by the Per Share Price ($17.12).

Sentiment

Score: 7

Explanation: The sentiment is positive for the reporting person as their equity holdings were converted to cash or cash-equivalent awards at a defined merger price, providing liquidity and continued value for unvested awards with favorable acceleration clauses.

Positives

• Reporting person Adiya Dixon received cash for her common stock holdings at a fixed price of $17.12 per share.
• Unvested RSUs and PSUs were converted into cash awards, maintaining their value based on the merger price and original vesting terms, with 'double-trigger' accelerated vesting provisions for certain terminations.

Negatives

• Potbelly Corp common stock is no longer publicly traded, as it became a wholly-owned subsidiary of RaceTrac, Inc.

Future Outlook

Substituted RSU Cash Awards will continue to be subject to the same vesting terms and conditions as the original Unvested RSUs, with 'double-trigger' accelerated vesting upon termination without cause or resignation for good reason post-closing. Substituted PSU Cash Awards will be payable on the last day of their respective performance periods, subject to continued employment, also with 'double-trigger' accelerated vesting under similar conditions.

Industry Context

This filing reflects a significant corporate action within the restaurant and food service industry, where Potbelly Corp, a publicly traded company, has been acquired and taken private by RaceTrac, Inc. This indicates a consolidation trend or strategic expansion by RaceTrac into the fast-casual segment.

Stakeholder Impact

• Shareholders: All public shareholders of Potbelly Corp received $17.12 per share in cash, ceasing to be shareholders of a publicly traded entity.
• Employees (with equity awards): Employees holding RSUs and PSUs, such as Adiya Dixon, had their awards converted into cash awards, preserving their value and vesting schedules, with additional protections for termination.

Next Steps

• Vesting and settlement of Substituted RSU Cash Awards according to their original terms or accelerated vesting conditions.
• Vesting and settlement of Substituted PSU Cash Awards on their respective Vesting Dates, subject to continued employment or accelerated vesting conditions.

Key Dates

Keywords

Potbelly, PBPB, RaceTrac, Merger, Acquisition, Adiya Dixon, Form 4, Equity Conversion, Restricted Stock Units, Performance Stock Units, Corporate Action