| Page | | | 61 | | | each Named Executive Officer;
each of our directors and nominees for director; and
all of our executive officers and directors as a group.
We have determined beneficial ownership in accordance with the rules of the SEC. Except as indicated by the footnotes below, and subject to applicable community property laws, we believe, based on the information furnished to us, that the persons and entities named in the table below have sole voting and dispositive power with respect to all common stock that they beneficially own.
Common stock subject to stock options that are currently exercisable or exercisable within 60 days of April 12, 2021 and RSUs that vest within 60 days of April 12, 2021 are deemed to be outstanding and to be beneficially owned by the person holding the equity award for the purpose of computing the percentage ownership of that person but are not treated as outstanding for the purpose of computing the percentage ownership of any other person.
The percentages of beneficial ownership set forth below are based on 95,551,903 shares of our common stock outstanding as of April 12, 2021.
Except as otherwise indicated in the footnotes below, the address of each beneficial owner is c/o Grocery Outlet Holding Corp., 5650 Hollis Street, Emeryville, California 94608. 2023 Proxy Statement
5% Stockholders:
| | | | | | | Jackson Square Partners, LLC(1) | | | 9,527,609 | | | 10.0% | Sands Capital Management, LLC(2) | | | 8,875,219 | | | 9.3% | The Vanguard Group(3) | | | 7,277,300 | | | 7.6% | BlackRock, Inc.(4) | | | 7,056,652 | | | 7.4% | Kayne Anderson Rudnick Investment Management LLC(5) | | | 5,885,728 | | | 6.2% | Named Executive Officers and Directors:
| | | | | | | Eric J. Lindberg, Jr.(6) | | | 5,098,439 | | | 5.2% | Charles C. Bracher(7) | | | 310,726 | | | * | Robert Joseph Sheedy, Jr.(8) | | | 202,640 | | | * | Pamela B. Burke.(9) | | | 136,186 | | | * | Heather L. Mayo | | | 1,961 | | | * | Erik D. Ragatz(10) | | | 209,096 | | | * | S. MacGregor Read, Jr.(11) | | | 4,819,837 | | | 5.0% | Kenneth W. Alterman(12) | | | 62,827 | | | * | John E. Bachman | | | 3,061 | | | * | Mary Kay Haben | | | 3,061 | | | * | Thomas F. Herman(13) | | | 78,917 | | | * | Carey F. Jaros | | | — | | | * | Norman S. Matthews(14) | | | 147,696 | | | * | Maria Fernanda Mejía | | | — | | | * | Gail Moody-Byrd | | | — | | | * | Jeffrey York | | | 132,823 | | | * | All directors and executive officers as a group (20 persons)(15) | | | 11,650,899 | | | 11.8% |
| | | *
| Indicates beneficial ownership of less than 1%. | |
(1)
| Based upon statements contained in a Schedule 13G/A filed by Jackson Square Partners, LLC on February 9,
Named Executive Officer Compensation Tables
Narrative Disclosure to Summary Compensation Table and Grants of Plan-Based Awards Our Compensation Discussion and Analysis section of this Proxy Statement describes all material factors necessary to understand and give context to the information in the two preceding tables for Fiscal Year 2022. In March 2023, the Compensation Committee determined our performance achievement applicable to the Fiscal Year 2020 PSUs. Three-year revenue was $9.8 billion, which resulted in a 200% payout for that weighted metric, and three-year adjusted EBITDA growth was 34.6%, which resulted in a 192% payout for that weighted metric. Therefore, earned Fiscal Year 2020 PSUs represented a combined achievement of 196% of the target PSUs granted. See Our Compensation Discussion and Analysis section of this Proxy Statement for additional information. For Fiscal Years 2022 and 2020, each of our NEOs received profit-sharing contributions under our 401(k) Plan, which are included under “All Other Compensation” in the Summary Compensation Table. No payments under this program were made for Fiscal Year 2021. According to the Schedule 13G/A, Jackson Square Partners, LLC has sole voting power over 7,551,889 of the reported shares, shared voting power over 621,204 of the reported shares and sole dispositive power over all reported shares. The address of Jackson Square Partners, LLC is One Letterman Drive, Building A, Suite A3-200, San Francisco, California 94129. Ownership percentage assumes the stockholder continued to own the number of shares reflected in the table above on April 12, 2021. |
| Page | | | 62 | | | 49 Grocery Outlet 2023 Proxy Statement
| | | | |
Named Executive Officer Compensation Tables
Outstanding Equity Awards at 2022 Fiscal Year End The following table includes certain information with respect to outstanding equity awards held by our Named Executive Officers as of December 31, 2022. All specified vesting dates noted below are subject to continued employment or service with us through the applicable vesting date for stock options and RSUs, and through the Compensation Committee’s determination date of achievement for PSUs. | | | | | | | | | | OPTION AWARDS | | | STOCK AWARDS | | | NAME | | | GRANT DATE | | | NUMBER OF SECURITIES UNDERLYING UNEXERCISED OPTIONS EXERCISABLE (#) | | | NUMBER OF SECURITIES UNDERLYING UNEXERCISED OPTIONS UNEXERCISABLE (#) | | | OPTION EXERCISE PRICE ($) | | | OPTION EXPIRATION DATE | | | NUMBER OF SHARES OR UNITS OF STOCK THAT HAVE NOT VESTED (#) | | | MARKET VALUE OF SHARES OR UNITS OF STOCK THAT HAVE NOT VESTED ($)(1) | | | EQUITY INCENTIVE PLAN AWARDS: NUMBER OF UNEARNED SHARES, UNITS OR OTHER RIGHTS THAT HAVE NOT VESTED (#) | | | EQUITY INCENTIVE PLAN AWARDS: MARKET OR PAYOUT VALUE OF UNEARNED SHARES, UNITS OR OTHER RIGHTS THAT HAVE NOT VESTED ($)(1) | | | Eric J. Lindberg, Jr. | | | | | 10/21/2014 | | | | | | 477,565 | | | | | | — | | | | | | 3.81 | | | | | | 10/21/2024 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 10/21/2014 | | | | | | 1,332,614 | | | | | | — | | | | | | 7.13 | | | | | | 10/21/2024 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 6/19/2019 | | | | | | — | | | | | | 210,450(2) | | | | | | 22.00 | | | | | | 6/19/2029 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 5/13/2020 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 8,379(3) | | | | | | 244,583 | | | | | | 117,300(4) | | | | | | 3,423,987(4) | | | | | | 3/4/2021 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 18,054(3) | | | | | | 526,996 | | | | | | 63,188(4) | | | | | | 1,844,458(4) | | | | | | 3/3/2022 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 34,127(3) | | | | | | 996,167 | | | | | | 159,256(4) | | | | | | 4,648,683(4) | | | | Charles C. Bracher | | | | | 11/25/2014 | | | | | | 53,365 | | | | | | — | | | | | | 3.81 | | | | | | 11/25/2024 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 11/25/2014 | | | | | | 78,247 | | | | | | — | | | | | | 7.13 | | | | | | 11/25/2024 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 6/19/2019 | | | | | | — | | | | | | 91,195(2) | | | | | | 22.00 | | | | | | 6/19/2029 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 5/13/2020 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 3,893(3) | | | | | | 113,637 | | | | | | 35,036(4) | | | | | | 1,022,701(4) | | | | | | 3/4/2021 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 8,351(3) | | | | | | 243,766 | | | | | | 18,788(4) | | | | | | 548,422(4) | | | | | | 3/3/2022 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 15,756(3) | | | | | | 460,180 | | | | | | 47,296(4) | | | | | | 1,380,570(4) | | | | Robert J. Sheedy, Jr. | | | | | 11/25/2014 | | | | | | 10,389 | | | | | | — | | | | | | 3.81 | | | | | | 11/25/2024 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 6/19/2019 | | | | | | — | | | | | | 91,195(2) | | | | | | 22.00 | | | | | | 6/19/2029 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 5/13/2020 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 5,270(3) | | | | | | 153,831 | | | | | | 47,426(4) | | | | | | 1,384,365(4) | | | | | | 3/4/2021 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 13,542(3) | | | | | | 395,291 | | | | | | 30,467(4) | | | | | | 889,332(4) | | | | | | 3/3/2022 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 25,565(3) | | | | | | 746,242 | | | | | | 76,694(4) | | | | | | 2,238,698(4) | | | | Pamela B. Burke | | | | | 3/31/2017 | | | | | | 7,015 | | | | | | — | | | | | | 8.57 | | | | | | 3/31/2027 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 12/26/2018(5) | | | | | | 10,284 | | | | | | 9,821 | | | | | | 11.64 | | | | | | 12/26/2028 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 12/26/2018 | | | | | | 34,105 | | | | | | — | | | | | | 11.64 | | | | | | 12/26/2028 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 6/19/2019 | | | | | | — | | | | | | 63,135(2) | | | | | | 22.00 | | | | | | 6/19/2029 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 5/13/2020 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 3,017(3) | | | | | | 88,066 | | | | | | 27,148(4) | | | | | | 792,450(4) | | | | | | 3/4/2021 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 6,470(3) | | | | | | 188,859 | | | | | | 14,557(4) | | | | | | 424,919(4) | | | | | | 3/3/2022 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 12,824(3) | | | | | | 374,333 | | | | | | 38,470(4) | | | | | | 1,122,939(4) | | | | Steven K. Wilson | | | | | 11/25/2014 | | | | | | 5,522 | | | | | | — | | | | | | 3.81 | | | | | | 11/25/2024 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 11/25/2014 | | | | | | 26,495 | | | | | | — | | | | | | 7.13 | | | | | | 11/25/2024 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 6/19/2019 | | | | | | — | | | | | | 56,120(2) | | | | | | 22.00 | | | | | | 6/19/2029 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 5/13/2020 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 3,013(3) | | | | | | 87,949 | | | | | | 27,112(4) | | | | | | 791,399(4) | | | | | | 3/4/2021 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 7,523(3) | | | | | | 219,596 | | | | | | 16,926(4) | | | | | | 494,070(4) | | | | | | 3/3/2022 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 14,202(3) | | | | | | 414,556 | | | | | | 42,606(4) | | | | | | 1,243,669(4) | | |
(1)
The amounts shown in this column represents the number of shares of our common stock that have not vested multiplied by $29.19, the closing price per share of our common stock on December 30, 2022, the last trading day of Fiscal Year 2022. (2)
Represent unvested time-vesting options, which vest and become exercisable in one installment on the fourth anniversary of the grant date. (3)
Each RSU vests in three equal annual installments over the three-year period measured from the vesting commencement date of March 1, 2020 (for Fiscal Year 2020 grants), March 1, 2021 (for Fiscal Year 2021 grants), or March 1, 2022 (for Fiscal Year 2022 grants). (4)
The number and market value of the PSUs reported for Fiscal Year 2020 grants reflect maximum performance because performance through December 31, 2022, the last day of Fiscal Year 2022, was tracking above the target payout level. Earned Fiscal Year 2020 PSUs represented a combined achievement of 196% of the target PSUs granted. See Our Compensation Discussion and Analysis section of this Proxy Statement for additional information. The number and market value of the PSUs reported for Fiscal Year 2021 grants reflect target performance because performance through the last day of Fiscal Year 2022, was tracking above threshold but below the target payout level. The number and market value of the PSUs reported for | Page | | | 63 | | | Grocery Outlet 2023 Proxy Statement | | | | |
Named Executive Officer Compensation Tables
Fiscal Year 2022 grants reflect maximum performance because performance through December 31, 2022, the last day of Fiscal Year 2022, was tracking above the target payout level. The actual numbers of shares of our common stock that will be distributed for Fiscal Years 2021 and 2022 at the end of the three-year performance period are not yet determinable. The PSUs will vest (if at all) based on the achievement of cumulative operating goals over a three-year performance period. See “Compensation Discussion and Analysis—Long-Term Equity Incentive Compensation” for more information on the cumulative operating goals. (5)
The stock option has a vesting commencement date of December 26, 2018 and vests in installments of 9,821 shares of our common stock each year with the final installment vesting on December 26, 2023. TABLE OF CONTENTS
| Page | | | 64 | | | Grocery Outlet 2023 Proxy Statement | | | (2)
| Based upon statements contained in a Schedule 13G filed by Sands Capital Management, LLC on February 16, 2021. Shares reported are beneficially owned by clients of Sands Capital Management, LLC. According to the Schedule 13G, Sands Capital Management, LLC has sole voting power over 6,310,332 of the reported shares, shared voting power over none of the reported shares and sole dispositive power over all of the reported shares. The address of Sands Capital Management, LLC is 1000 Wilson Blvd., Suite 3000, Arlington, Virginia 22209. Ownership percentage assumes the stockholder continued to own the number of shares reflected in the table above on April 12, 2021.![[MISSING IMAGE: lg_groceryoutlet-pn.jpg]](/files/DEF 14A/0001104659-23-053007/lg_groceryoutlet-pn.jpg) | |
(3)
| Based upon statements in a Schedule 13G filed by The Vanguard Group on February 10, 2021. The Vanguard Group may be deemed to beneficially own the reported shares and has filed the Schedule 13G as the parent holding company or control person on behalf of its subsidiaries Vanguard Asset Management, Limited, Vanguard Fiduciary Trust Company, Vanguard Global Advisors, LLC, Vanguard Group (Ireland) Limited, Vanguard Investments Australia Ltd, Vanguard Investments Canada Inc., Vanguard Investments Hong Kong Limited and Vanguard Investments UK, Limited. According to the Schedule 13G, The Vanguard Group has sole voting power over none of the reported shares, shared voting power over 52,753 of the reported shares, sole dispositive power over 7,163,367 of the reported shares and shared dispositive power over 113,933 of the reported shares. The address of The Vanguard Group is 100 Vanguard Blvd., Malvern, Pennsylvania 19355. Ownership percentage assumes the stockholder continued to own the number of shares reflected in the table above on April 12, 2021.
Named Executive Officer Compensation Tables
Option Exercises and Stock Vested During Fiscal Year 2022 The following table provides information about the value realized by the Named Executive Officers on the exercise of stock options and the vesting of stock awards during Fiscal Year 2022. | | | | OPTION AWARDS | | | STOCK AWARDS | | | NAME | | | NUMBER OF SHARES ACQUIRED ON EXERCISE (#) | | | VALUE REALIZED ON EXERCISE ($)(1) | | | NUMBER OF SHARES ACQUIRED ON VESTING (#) | | | VALUE REALIZED ON VESTING ($) | | | Eric J. Lindberg, Jr. | | | | | 305,049 | | | | | | 10,746,064 | | | | | | 17,406 | | | | | | 490,327 | | | | Charles C. Bracher | | | | | 133,699 | | | | | | 4,558,516 | | | | | | 8,068 | | | | | | 227,276 | | | | Robert J. Sheedy, Jr. | | | | | 166,670 | | | | | | 5,768,337 | | | | | | 12,040 | | | | | | 339,167 | | | | Pamela B. Burke | | | | | 94,627 | | | | | | 2,391,169 | | | | | | 6,252 | | | | | | 176,119 | | | | Steven K. Wilson | | | | | 50,000 | | | | | | 1,624,331 | | | | | | 6,773 | | | | | | 190,795 | | |
(1)
Based on the amount by which the market price of a share of our common stock on the dates of exercise exceeded the applicable exercise price per share of the option. | Page | | | 65 | | | Grocery Outlet 2023 Proxy Statement | | | | |
(4)
|
Named Executive Officer Compensation Tables
Potential Payments Upon Termination or Change in Control The information below describes and estimates certain compensation that would have been payable to our Named Executive Officers under existing plans and arrangements if a qualifying termination or change in control occurred on December 31, 2022, the last day of Fiscal Year 2022. These benefits are in addition to benefits available generally to salaried employees. Due to the number of factors that affect the nature and amount of any benefits provided upon the events discussed below, any actual amounts paid or distributed may be different from those estimated below. Factors that could affect these amounts include the timing during the year of any such event and our valuation at that time. There can be no assurance that a termination or change in control would produce the same or similar results as those described below if any assumption used to prepare this information is not correct in fact. SEVERANCE BENEFITS UPON TERMINATION FOR MR. LINDBERG The employment agreement for Mr. Lindberg , which terminated as of December 31, 2022, provided that in the event of a termination of employment without Cause or resignation for Good Reason (as defined in his agreement) he was entitled to (i) accrued base salary and benefits, (ii) continued payment of his base salary in equal installments in accordance with the Company’s regular payroll practices for a period of 24 months; (iii) an amount equal to two times his target bonus for the year in which the termination date occurs, payable in equal installments for a period of 24 months following the termination date; and (iv) payment for up to 18 months of his medical and dental benefits for him and his dependents which are substantially the same as the benefits provided immediately prior to the termination date (including, in our discretion, payment for the costs associated with continuation coverage pursuant to COBRA). Mr. Lindberg’s agreement further provided that if his employment was terminated by reason of his death or disability, he would have been entitled to a lump sum amount equal to his target annual bonus for the year in which the termination occurs, prorated based on the ratio of the number of days during such year that the executive was employed to 365. SEVERANCE BENEFITS UPON TERMINATION FOR MR. SHEEDY The employment agreement (effective January 1, 2023) for Mr. Sheedy provides that in the event of a termination of employment without Cause or resignation for Good Reason (as defined in his agreement) he is entitled to (i) accrued base salary and benefits, (ii) continued payment of his base salary in equal installments in accordance with the Company’s regular payroll practices for a period of 24 months; (iii) an amount equal to two times his target bonus for the year in which the termination date occurs, payable in equal installments for a period of 24 months; (iv) payment for up to 18 months of medical and dental benefits; (v) any unpaid bonus in respect of any fiscal year completed prior to the date of termination; (vi) subject to the satisfaction of applicable performance objectives, payment of a pro-rated bonus with respect to the fiscal year of termination; and (vii) pro-rated vesting of any outstanding time-based restricted stock units or stock options, calculated, in each case, as of the date of termination (“Pro Rata Vesting Rights”). Further, if Mr. Sheedy’s employment is terminated by reason of his death or Disability (as defined in the Employment Agreement), he will be entitled to (i) Pro Rata Vesting Rights; (ii) accrued base salary and benefits (iii) a lump sum amount equal to his pro rata target annual bonus for the year in which the termination occurs, and (iv) any unpaid bonus in respect of any fiscal year completed prior to the date of termination. Upon the effectiveness of such agreement, Mr. Sheedy will no longer participate in the Company’s Executive Severance Plan. In consideration for the benefits provided to Mr. Sheedy, the Employment Agreement contains non-competition covenants during the term of the agreement as well as confidentiality and non-solicitation covenants. EXECUTIVE SEVERANCE PLAN On November 9, 2020, the Compensation Committee adopted the Executive Severance Plan to provide severance benefits to certain eligible employees of the Company and its affiliates who experience a termination of employment under the conditions described in the Executive Severance Plan. Eligible employees under the Executive Severance Plan in Fiscal Year 2022 included all of our Named Executive Officers, other than Mr. Lindberg due to his employment agreement. Mr. Sheedy was an eligible participant during Fiscal Year 2022, but will not be eligible in Fiscal Year 2023 due to his employment agreement. Non-Change-in-Control Severance Under the terms of the Executive Severance Plan, if a participant at the executive vice president level or senior vice president level experiences a termination by the Company without Cause (as defined in the Incentive Plan) or by the participant for Good Based upon statements in a Schedule 13G filed by BlackRock, Inc. on February 2, 2021. BlackRock, Inc. may be deemed to beneficially own the reported shares and has filed the Schedule 13G as the parent holding company or control person on behalf of its subsidiaries BlackRock Life Limited, BlackRock Advisors, LLC, BlackRock (Netherlands) B.V., BlackRock Institutional Trust Company, National Association, BlackRock Asset Management Ireland Limited, BlackRock Financial Management, Inc., BlackRock Asset Management Schweiz AG, BlackRock Investment Management, LLC, BlackRock Investment Management (UK) Limited, BlackRock Asset Management Canada Limited, BlackRock (Luxembourg) S.A., BlackRock Investment Management (Australia) Limited, BlackRock Advisors (UK) Limited, BlackRock Fund Advisors and BlackRock Fund Managers Ltd. According to the Schedule 13G, BlackRock, Inc. has sole voting power over 6,828,420 of the reported shares, shared voting power over none of the reported shares, sole dispositive power over 7,056,652 of the reported shares and shared dispositive power over none of the reported shares. The address of BlackRock, Inc. is 55 East 52nd Street, New York, New York 10055. Ownership percentage assumes the stockholder continued to own the number of shares reflected in the table above on April 12, 2021. | Page | | | 66 | | | Grocery Outlet 2023 Proxy Statement | | | | |
(5)
|
Named Executive Officer Compensation Tables
Reason (as defined in the Executive Severance Plan), either of which is referred to as a “covered termination,” not in connection with a Change in Control (as defined in the 2019 Incentive Plan), the Company will provide the participant with the following severance payments and benefits, subject to his or her continued compliance with a restrictive covenant agreement and the execution and non-revocation of a release of claims. The severance payments and benefits provided to our Named Executive Officers are as follows: •
an amount equal to 1.0 times the sum of the participant’s annual base salary and target annual bonus, payable in accordance with the Company’s normal payroll practice over 12 months; and •
subject to the participant’s timely election under COBRA, payment, or reimbursement for, the difference between the COBRA premium and the premium paid by active Company employees for the same coverage for 12 months. Change-in-Control Severance Under the terms of the Executive Severance Plan, if a participant at the executive vice president or senior vice president level experiences a covered termination within 18 months following a Change in Control, the Company will provide the participant with the following severance payments and benefits, subject to his or her continued compliance with a restrictive covenant agreement and the execution and non-revocation of a release of claims. The payments and benefits provided to our named executive officers are as follows: •
an amount equal to 1.5x times the sum of the participant’s annual base salary and target annual bonus, in each case, payable in a lump sum within 60 days following termination of employment; and •
subject to the participant’s timely election under COBRA, payment, or reimbursement for, the difference between the COBRA premium and the premium paid by active Company employees for the same coverage for 18 months. Eligible employees who receive severance benefits under the Executive Severance Plan will be bound by certain restrictive covenants in favor of the Company, including confidentiality, non-disparagement and non-solicitation covenants. The Executive Severance Plan provides that if payments and benefits provided to the participant would constitute an “excess parachute payment” for purposes of Section 280G of the Code, the participant will either have his or her payments and benefits reduced to the highest amount that could be paid without triggering Section 280G or receive the after-tax amount of his or her payment and benefits, whichever results in the greater after-tax benefit, taking into account the excise tax imposed under Section 4999 of the Code and any applicable federal, state and local taxes. The Executive Severance Plan may be amended, terminated or discontinued in whole or in part, at any time and from time to time at the discretion of the Board or the Compensation Committee; provided, however, that no adverse amendment, termination or discontinuance may be made without the consent of a participant who has undergone a covered termination prior to the effective date of any such adverse amendment, termination or discontinuance. In addition, following a Change in Control, the Executive Severance Plan may not be amended, terminated or discontinued in whole or in part, at any time prior to the second anniversary of the date of such change in control without the written consent of an affected participant. ACCELERATED VESTING OF EQUITY AWARDS UPON CERTAIN EVENTS Except as set forth below or in an employment agreement (described above), unvested equity awards will terminate as of termination of employment or service. Time-Vesting Options Each of our Named Executive Officers were granted time-vesting options under the 2019 Incentive Plan in Fiscal Year 2019, which provide that if the executive undergoes a termination of employment without Cause following a Change in Control (each as defined in the 2019 Incentive Plan), such options will become fully vested and exercisable. In addition, Ms. Burke holds one partially unvested time-based stock option award that was under the 2014 Stock Plan. Those awards provide that if a Change in Control (as defined in such plan) occurs during the optionee’s employment, the option will, to the extent not vested, become fully vested and exercisable immediately prior to the effective time of such Change in Control. Based upon statements in a Schedule 13G/A filed jointly by Kayne Anderson Rudnick Investment Management LLC and Virtus Investment Advisers, Inc. on February 16, 2021. Kayne Anderson Rudnick Investment Management, LLC has sole power to vote or to direct the vote of 1,067,846 of the reported shares, sole power to dispose or to direct the disposition of 1,067,846 of the reported shares, shared power to vote or direct the vote of 4,817,882 of the reported shares (shared with Virtus Investment Advisers, Inc.) and shared power to dispose or direct the disposition of 4,817,882 of the reported shares (shared with Virtus Investment Advisers, Inc.). The address of Kayne Anderson Rudnick Investment Management LLC is 1800 Avenue of the Stars, 2nd Floor, Los Angeles, California 90067. Ownership percentage assumes the stockholder continued to own the number of shares reflected in the table above on April 12, 2021. | Page | | | 67 | | | Grocery Outlet 2023 Proxy Statement | | | | |
(6)
| Consists of 2,265,228s shares issuable upon the exercise of options exercisable within 60 days following April 12, 2021 directly held by Mr. Lindberg, 460 shares directly held by Mr. Lindberg’s wife and 460 shares directly held by Mr. Lindberg’s child, 2,126,670 shares directly held by the Lindberg Revocable Trust u/a/d 2/14/06 of which Mr. Lindberg is a Trustee, 701,500 shares directly held by the Lindberg Irrevocable Trust u/a/d 5/12/17 of which Mr. Lindberg is a Trustee.
Named Executive Officer Compensation Tables
Performance Vesting Stock Units (PSUs) Each of our Named Executive Officers were also granted PSUs under the 2019 Incentive Plan (with all defined terms below defined in the 2019 Incentive Plan). Those awards provide for the following vesting upon various events: •
if the participant undergoes a termination as a result of participant’s death or disability prior to a Change in Control, a prorated portion of the PSU will vest (at target performance) on the date of such termination; •
in the event a participant undergoes a termination without Cause a prorated portion of the PSU will remain outstanding, and, in the event of a subsequent Change in Control following such termination, the outstanding portion of the PSU will vest at target performance; and •
in the event a participant undergoes a termination (i) without Cause, (ii) for Good Reason or (iii) by reason of death or disability, in each case following a Change in Control, the earned PSU will vest in full at target performance on the date of such termination. Time-Vesting Restricted Stock Units (RSUs) Each of our Named Executive Officers were also granted RSUs under the 2019 Incentive Plan (with all defined terms below defined in 2019 Incentive Plan). Those awards provide for full acceleration of the award if the participant undergoes a termination without Cause following a Change in Control. | Page | | | 68 | | | Grocery Outlet 2023 Proxy Statement | | | | |
(7)
| Consists of 265,311 shares issuable upon the exercise of options exercisable within 60 days following April 12, 2021, 44,005 shares held directly by Mr. Bracher and 1,410 shares directly held by Mr. Bracher’s spouse. Not included in the table above are 1,200 shares held in a trust for Mr. Bracher’s children over which Mr. Bracher has no voting or investment power.
Named Executive Officer Compensation Tables
POTENTIAL PAYMENTS UPON TERMINATION OR AFTER CHANGE IN CONTROL (AS OF DECEMBER 31, 2022) The following table describes the potential payments and benefits that would have been payable to our Named Executive Officers under existing plans and arrangements if a qualifying termination or change in control occurred on December 31, 2022, the last business day of our Fiscal Year 2022. The amounts shown in the tables do not include payments and benefits to the extent they are provided generally to all salaried employees upon termination of employment and do not discriminate in scope, terms or operation in favor of our Named Executive Officers. | NAME | | | TRIGGERING EVENT | | | SALARY ($) | | | BONUS ($) | | | HEALTH BENEFITS CONTINUATION COVERAGE ($) | | | VALUE OF OPTION ACCELERATION ($) | | | VALUE OF TIME-BASED RSU ACCELERATION ($) | | | VALUE OF PSU AWARD ACCELERATION ($) | | | TOTAL ($) | | | Eric J. Lindberg, Jr | | | Termination Without Cause or for Good Reason(1) | | | | | 1,650,000 | | | | | | 1,650,000 | | | | | | 77,266 | | | | | | — | | | | | | — | | | | | | — | | | | | | 3,377,266 | | | | Death or Disability prior to Change in Control | | | | | — | | | | | | 825,000(2) | | | | | | — | | | | | | — | | | | | | — | | | | | | 3,716,412(3) | | | | | | 4,541,412 | | | | Termination Without Cause after Change in Control | | | | | — | | | | | | — | | | | | | — | | | | | | 1,513,136(4) | | | | | | 1,767,746(3) | | | | | | 5,880,793(3) | | | | | | 9,161,674 | | | | Death or Disability after a Change in Control | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 5,880,793(3) | | | | | | 5,880,793 | | | | Charles C. Bracher | | | Termination Without Cause or for Good Reason(5) | | | | | 571,666 | | | | | | 343,000 | | | | | | 33,212 | | | | | | — | | | | | | — | | | | | | — | | | | | | 947,877 | | | | Qualifying Termination after Change in Control | | | | | 857,499(5) | | | | | | 514,499(5) | | | | | | 49,818(5) | | | | | | 655,692(4) | | | | | | 817,583(3) | | | | | | 1,750,057(3) | | | | | | 4,645,148 | | | | Death or Disability prior to Change in Control | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 1,107,060(3) | | | | | | 1,107,060 | | | | Death or Disability after a Change in Control | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 1,750,057(3) | | | | | | 1,750,057 | | | | Robert J. Sheedy, Jr | | | Termination Without Cause or for Good Reason(5) | | | | | 618,025 | | | | | | 463,519 | | | | | | 33,136 | | | | | | — | | | | | | — | | | | | | — | | | | | | 1,114,680 | | | | Qualifying Termination after Change in Control | | | | | 927,038(5) | | | | | | 695,278(5) | | | | | | 49,704(5) | | | | | | 655,692(4) | | | | | | 1,295,365(3) | | | | | | 2,770,863(3) | | | | | | 6,323,939 | | | | Death or Disability prior to Change in Control | | | | | | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 1,658,187(3) | | | | | | 1,658,187 | | | | Death or Disability after a Change in Control | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 2,770,863(3) | | | | | | 2,770,863 | | | | Pamela B. Burke | | | Termination Without Cause or for Good Reason(5) | | | | | 465,000 | | | | | | 279,000 | | | | | | 33,212 | | | | | | — | | | | | | — | | | | | | — | | | | | | 777,212 | | | | Qualifying Termination after Change in Control | | | | | 697,500(5) | | | | | | 418,500(5) | | | | | | 49,818(5) | | | | | | 453,941 | | | | | | 651,258 | | | | | | 1,382,614(3) | | | | | | 3,653,630 | | | | Death or Disability prior to Change in Control | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 866,661 | | | | | | 866,661 | | | | Death or Disability after a Change in Control | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 1,382,614(3) | | | | | | 1,382,614 | | | | Change in Control | | | | | — | | | | | | — | | | | | | — | | | | | | 172,359(6) | | | | | | — | | | | | | — | | | | | | 172,359 | | | | Steven K. Wilson | | | Termination Without Cause or for Good Reason(5) | | | | | 412,200 | | | | | | 206,100 | | | | | | 33,092 | | | | | | — | | | | | | — | | | | | | — | | | | | | 651,392 | | | | Qualifying Termination after Change in Control | | | | | 618,300(5) | | | | | | 309,150(5) | | | | | | 49,638(5) | | | | | | 403,503(4) | | | | | | 722,102(3) | | | | | | 1,511,604(3) | | | | | | 3,614,297 | | | | Death or Disability prior to Change in Control | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 932,358(3) | | | | | | 932,358 | | | | Death or Disability after a Change in Control | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 1,511,604(3) | | | | | | 1,511,604 | | |
(1)
The employment agreement for Mr. Lindberg provided that in the event of a termination of employment without cause or resignation for good reason, the executive would be entitled to (i) payment of his base salary, payable in equal installments in accordance with our regular payroll practices for a | Page | | | 69 | | | Grocery Outlet 2023 Proxy Statement | | | | |
(8)
| Consists of 177,059 shares issuable upon the exercise of options exercisable within 60 days following April 12, 2021 and 25,581 shares held directly by Mr. Sheedy.
Named Executive Officer Compensation Tables
period of 24 months following the termination date; (ii) an amount equal to two times his target bonus for the year in which the termination date occurs, payable in equal installments for a period of 24 months following the termination date; and (iii) medical and dental benefit payments and, in our discretion, payment for the costs associated with COBRA premium for a period of 18 months for the executive and his dependents, which benefits are substantially the same as the benefits provided immediately prior to the termination date. For purposes of calculating (iii) we used the COBRA premium amounts. (2)
The employment agreement for Mr. Lindberg provided that if his employment was terminated by reason of his death or disability, he would be entitled to a lump sum amount equal to his target annual bonus for the year in which the termination occurs, prorated based on the ratio of the number of days during such year that the executive was employed to 365. (3)
The form of Time-Based Restricted Stock Unit Notice and Agreement under our 2019 Incentive Plan provides, among other terms, full acceleration of the award if the participant undergoes a termination without Cause following a Change in Control. Additionally, the form of Performance Stock Unit Grant Notice and Agreement under our 2019 Incentive Plan provides, among other terms, (i) in the event a participant undergoes a termination as a result of participant’s death or disability prior to a Change in Control, then a prorated portion of the PSU will vest, with such proration based on the number of days elapsed from the commencement of the performance period through the date of such termination; and (ii) in the event a participation undergoes a termination after a Change in Control either without cause, for good reason or due to participant’s death or disability, then the PSUs will vest in full at target performance as of the date of such termination. (4)
On June 19, 2019, the Company granted each of Messrs. Lindberg, Bracher, Sheedy and Wilson, and Ms. Burke a time-vesting option to purchase shares of our common stock, respectively, at an exercise price of $22.00. As of December 31, 2022, all shares of our common stock subject to the option held by each of the executives are unvested. If the executive undergoes a termination of employment without cause following a change in control, the option will become fully vested and exercisable. The amounts above represent the value associated with the accelerated vesting of the unvested shares of our common stock subject to each option held by the executive upon a change in control, which is the product of (i) the difference between (A) the closing price of our common stock as of December 30, 2022, the last trading day of Fiscal Year 2022 ($29.19) and (B) the exercise price ($22.00); and (ii) the number of unvested shares of our common stock subject to the option as of December 31, 2022. (5)
In connection with the Executive Severance Plan described above each of our NEOs (other than Mr. Lindberg for Fiscal Year 2022) is entitled to the following benefits if he or she is terminated without cause, or by the participant for good reason not in connection with a Change in Control: (i) 1.0 times the sum of the participant’s annual base salary and target bonus, payable in accordance with our regular payroll practices over 12 months; and (ii) subject to participant’s timely election under COBRA, payment, or reimbursement for, the difference between the COBRA premium and the premium paid by active Company employees for the same coverage for 12 months. (6)
On December 26, 2018 Ms. Burke was granted a time-based stock options under our predecessor 2014 Stock Plan at an exercise price of $11.64. That stock option provides that if a Change in Control occurs during the Optionee’s Employment, the Option will, to the extent not vested, become fully vested and exercisable immediately prior to the effective time of such Change in Control. | Page | | | 70 | | | Grocery Outlet 2023 Proxy Statement | | | | |
(9)
| Consists of 134,374 shares issuable upon the exercise of options exercisable within 60 days following April 12, 2021 and 1,812 shares held directly by Ms. Burke.
Named Executive Officer Compensation Tables
Pay Versus Performance The following table provides information about the relationship between executive compensation actually paid and certain financial performance of the Company. Please see “Compensation Discussion and Analysis” for a discussion of our compensation philosophy, objectives, process and components of our NEO compensation program, including how the Compensation Committee structures our NEO compensation program to motivate and reward the achievement of performance-based financial goals that align with our operational and strategic objectives. The SEC-defined Compensation Actually Paid data set forth in the table below does not reflect amounts actually realized by our NEOs, and the Compensation Committee has not used or considered CAP previously in establishing the NEO compensation program. A significant portion of the CAP amounts shown relate to changes in values of unvested awards over the course of the reporting fiscal year. These unvested awards remain subject to significant risk from forfeiture conditions and possible future declines in value based on changes in our stock price. As described in detail in the “Compensation Discussion and Analysis” section above, the PSUs are subject to multi-fiscal year performance conditions tied to objective performance metrics and all of the RSUs and PSUs are subject to time vesting conditions. The ultimate values actually realized by our NEOs from unvested equity awards, if any, will not be determined until the awards fully vest (or thereafter upon exercise, in the case of outstanding stock options). | | | | | | | | | | | | | | | | Average Summary Compensation Table Total for Non-PEO NEOs ($)(3) (d) | | | | | | | | | Value of Initial Fixed $100 Investment Based On: | | | | | | | | | | | | | | | Fiscal Year (a) | | | Summary Compensation Table Total for PEO ($)(1) (b) | | | Compensation Actually Paid to PEO ($)(2) (c) | | | Average Compensation Actually Paid to Non-PEO NEOs ($)(4) (e) | | | Total Shareholder Return ($)(5) (f) | | | Peer Group Total Shareholder Return ($)(6) (g) | | | Net Income (thousands) ($)(7) (h) | | | Adjusted EBITDA (thousands) ($)(8) (i) | | | 2022 | | | | | 5,330,287 | | | | | | 8,453,783 | | | | | | 2,259,365 | | | | | | 3,264,167 | | | | | | 87.21 | | | | | | 118.60 | | | | | | 65,052 | | | | | | 214,682 | | | | 2021 | | | | | 4,008,965 | | | | | | (515,014) | | | | | | 1,693,919 | | | | | | 25,605 | | | | | | 84.49 | | | | | | 172.04 | | | | | | 62,310 | | | | | | 182,892 | | | | 2020 | | | | | 5,452,022 | | | | | | 12,956,398 | | | | | | 2,278,353 | | | | | | 4,068,193 | | | | | | 117.27 | | | | | | 147.65 | | | | | | 106,713 | | | | | | 212,705 | | |
(1)
The dollar amounts reported in column (b) are the amounts of total compensation reported for Mr. Lindberg (our Chief Executive Officer during Fiscal Years 2020 through 2022) for each corresponding fiscal year in the “Total” column of the Summary Compensation Table. Refer to “Named Executive Officer Compensation Tables—Summary Compensation Table in Fiscal Years 2022, 2021 and 2020.” (2)
The dollar amounts reported in column (c) represent the amount of “compensation actually paid” to Mr. Lindberg, as computed in accordance with Item 402(v) of Regulation S-K. The dollar amounts do not reflect the actual amount of compensation earned by or paid to Mr. Lindberg during the applicable fiscal year. In accordance with the requirements of Item 402(v) of Regulation S-K, the following table provides the adjustments that were made to Mr. Lindberg’s total compensation for each fiscal year to determine the compensation actually paid. No amounts were reported in the “Change in Pension Value and Nonqualified Deferred Compensation Earnings” column of the Summary Compensation Table for any applicable fiscal year, and therefore no defined benefit and actuarial pension plan adjustments were made for any applicable fiscal year. | Fiscal Year | | | Reported Summary Compensation Table Total for PEO ($) | | | Reported Value of Equity Awards ($)(a) | | | Equity Award Adjustments ($)(b) | | | Compensation Actually Paid to PEO ($) | | | 2022 | | | | | 5,330,287 | | | | | | (3,300,033) | | | | | | 6,423,529 | | | | | | 8,453,783 | | | | 2021 | | | | | 4,008,965 | | | | | | (3,200,036) | | | | | | (1,323,943) | | | | | | (515,014) | | | | 2020 | | | | | 5,452,022 | | | | | | (3,090,028) | | | | | | 10,594,404 | | | | | | 12,956,398 | | |
(a)
The grant date fair value of equity awards represents the total of the amounts reported in the “Stock Awards” columns in the Summary Compensation Table for the applicable fiscal year. (b)
The equity award adjustments for each applicable fiscal year include the addition (or subtraction, as applicable) of the following: (i) the fiscal year-end fair value of any equity awards granted in the applicable fiscal year that are outstanding and unvested as of the end of the fiscal year; (ii) the amount of change as of the end of the applicable fiscal year (from the end of the prior fiscal year) in fair value of any awards granted in prior fiscal years that are outstanding and unvested as of the end of the applicable fiscal year; (iii) for awards granted in prior fiscal years that vest in the applicable fiscal year, the amount equal to the change as of the vesting date (from the end of the prior fiscal year) in fair value; and (iv) for awards granted in prior fiscal years that are determined to fail to meet the applicable vesting conditions during the applicable fiscal year, a deduction for the amount equal to the fair value at the end of the prior fiscal year. No awards were granted and vested in the same fiscal year for any applicable fiscal year and no dividends or other earnings were paid on stock or option awards (that were not otherwise reflected in fair value or total compensation) in any applicable fiscal year. The fair values of RSUs and PSUs included in the CAP to our PEO and the Average CAP to our other | Page | | | 71 | | | Grocery Outlet 2023 Proxy Statement | | | | |
(10)
| Consists of shares of held by a limited partnership controlled by Mr. Ragatz.
Named Executive Officer Compensation Tables
NEOs are calculated at the required measurement dates, consistent with the approach used to value the awards at the grant date as described in our Annual Report on Form 10-K for Fiscal Year 2022. Any changes to the RSU and PSU fair values from the grant date (for current fiscal year grants) and from prior fiscal year-end (for prior fiscal year grants) are based on our updated stock price at the respective measurement dates, and for PSUs, updated performance metric projections. The following table provides the amounts deducted or added in calculating the equity award adjustments for Mr. Lindberg. | Fiscal Year | | | Year End Fair Value of Equity Awards Granted in the Fiscal Year ($) | | | Fiscal Year over Fiscal Year Change in Fair Value of Outstanding and Unvested Equity Awards ($) | | | Fiscal Year over Fiscal Year Change in Fair Value of Equity Awards Granted in Prior Fiscal Years that Vested in the Year ($) | | | Total Equity Award Adjustments ($) | | | 2022 | | | | | 4,947,547 | | | | | | 1,477,897 | | | | | | (1,915) | | | | | | 6,423,529 | | | | 2021 | | | | | 2,016,720 | | | | | | (3,312,680) | | | | | | (27,983) | | | | | | (1,323,943) | | | | 2020 | | | | | 4,439,607 | | | | | | 1,142,154 | | | | | | 5,012,643 | | | | | | 10,594,404 | | |
(3)
The dollar amounts reported in column (d) represent the average of the amounts reported for the NEOs as a group (excluding Mr. Lindberg) for each corresponding fiscal year in the “Total” column of the Summary Compensation Table. The names of each of the NEOs (excluding Mr. Lindberg) included for purposes of calculating the average amounts in each applicable fiscal year are as follows: (i) for Fiscal Years 2022 and 2021, Charles C. Bracher, Robert J. Sheedy, Jr., Steven K. Wilson and Pamela B. Burke; and (ii) for Fiscal Year 2020, Charles C. Bracher, Robert J. Sheedy, Jr., Pamela B. Burke and Heather L. Mayo. Refer to “Named Executive Officer Compensation Tables—Summary Compensation Table in Fiscal Years 2022, 2021 and 2020” herein, and “Executive Compensation—Summary Compensation Table” in the Company’s proxy statement for the 2020 annual meeting of stockholders. (4)
The dollar amounts reported in column (e) represent the average amount of “compensation actually paid” to the NEOs as a group (excluding Mr. Lindberg), as computed in accordance with Item 402(v) of Regulation S-K. The dollar amounts do not reflect the actual average amount of compensation earned by or paid to the NEOs as a group (excluding Mr. Lindberg) during the applicable fiscal year. In accordance with the requirements of Item 402(v) of Regulation S-K, the following table provides the adjustments that were made to average total compensation for the NEOs as a group (excluding Mr. Lindberg) for each fiscal year to determine the compensation actually paid, using the same methodology described above in Note 2. No amounts were reported in the “Change in Pension Value and Nonqualified Deferred Compensation Earnings” column of the Summary Compensation Table for any applicable fiscal year, so no defined benefit and actuarial pension plan adjustments were made for any applicable fiscal year, and therefore no defined benefit and actuarial pension plan adjustments were made for any applicable fiscal year. | Fiscal Year | | | Average Reported Summary Compensation Table Total for Non-PEO NEOs ($) | | | Average Reported Value of Equity Awards ($) | | | Average Equity Award Adjustments ($)(a) | | | Average Compensation Actually Paid to Non-PEO NEOs ($) | | | 2022 | | | | | 2,259,365 | | | | | | (1,239,373) | | | | | | 2,244,175 | | | | | | 3,264,167 | | | | 2021 | | | | | 1,693,919 | | | | | | (1,192,583) | | | | | | (475,731) | | | | | | 25,605 | | | | 2020 | | | | | 2,278,353 | | | | | | (1,092,192) | | | | | | 2,882,032 | | | | | | 4,068,193 | | |
(a)
See Note (b) to footnote (2) above for an explanation of the equity award adjustments made in accordance with Item 402(v) of Regulation S-K. The following tables provides the amounts deducted or added in calculating the total average equity award adjustments for the NEOs as a group (excluding Mr. Lindberg). | Page | | | 72 | | | Grocery Outlet 2023 Proxy Statement | | | | |
(11)
| Consists of (i) 200,000 shares issuable upon the exercise of options exercisable within 60 days following April 12, 2021 directly held by Mr. Read, (ii) 1,175 shares held as fully vested deferred stock units under our Director Deferral Program directly held by Mr. Read, (iii) 2,307,975 shares directly held by The Nordlingen Trust dated 1/23/2012, as amended and restated, 9/17/2014 of which Mr. Read is a Trustee and (iv) 2,307,975 shares directly held by The Redmond Trust dated 10/19/2003, as amended and restated, 9/17/2014 of which Mr. Read is a Trustee.
Named Executive Officer Compensation Tables
| Fiscal Year | | | Average Fiscal Year End Fair Value of Equity Awards ($) | | | Fiscal Year over Fiscal Year Average Change in Fair Value of Outstanding and Unvested Equity Awards ($) | | | Fiscal Year over Fiscal Year Average Change in Fair Value of Equity Awards Granted in Prior Fiscal Years that Vested in the Fiscal Year ($) | | | Total Average Equity Award Adjustments ($) | | | 2022 | | | | | 1,770,827 | | | | | | 462,087 | | | | | | 11,261 | | | | | | 2,244,175 | | | | 2021 | | | | | 780,129 | | | | | | (1,211,359) | | | | | | (44,501) | | | | | | (475,731) | | | | 2020 | | | | | 1,495,126 | | | | | | 391,680 | | | | | | 995,226 | | | | | | 2,882,032 | | |
(5)
Based on the Cumulative TSR as of the end of the applicable fiscal year, which is calculated by dividing the sum of the cumulative amount of dividends for the measurement period, assuming dividend reinvestment, and the difference between our stock price at the end and the beginning of the measurement period by our stock price at the beginning of the measurement period. Historical stock performance is not necessarily indicative of future stock performance. (6)
Represents the weighted peer group TSR, weighted according to the respective companies’ stock market capitalization at the beginning of each period for which a return is indicated. The peer group used for this purpose is the following published industry index: Nasdaq US Benchmark General Retailers Index. (7)
The dollar amounts reported represent the amount of net income reflected in our audited consolidated financial statements for the applicable fiscal year. (8)
Adjusted EBITDA is defined as net income before net interest expense, income taxes, depreciation and amortization expenses, share-based compensation expense, asset impairment and gain or loss on disposition and certain other expenses that may not be indicative of, or are unrelated to, our core operating results, and that may vary in frequency or magnitude. Beginning with the fourth quarter of fiscal 2022, we updated our definition of adjusted EBITDA to exclude the impact of non-cash rent expense and the provision for (write-off of) accounts receivable reserves. The presentation for adjusted EBITDA for Fiscal Years 2021 and 2020 has been recast to reflect these changes. While we use other financial and non-financial performance measures for the purpose of evaluating performance for our compensation programs, we have determined that adjusted EBITDA is the financial performance measure that, in our assessment, represents the most important performance measure (that is not otherwise required to be disclosed in the table) used by us to link compensation actually paid to our NEOs, for the most recently completed fiscal year, to Company performance. Adjusted EBITDA is used as a significant performance metric for both our Fiscal Year 2022 AIP and the PSUs granted in Fiscal Year 2022. We may determine a different financial performance measure to be the most important financial performance measure in future fiscal years. Financial Performance Measures As described in greater detail in “Compensation Discussion and Analysis,” a significant portion of our executive pay is tied to Company performance in line with our compensation philosophy. Our executive compensation program rewards the achievement of specific short-term (annual) and long-term financial goals, which are aligned with our operational and strategic objectives. The most important financial performance measures used by us to link executive compensation actually paid to our NEOs, for the most recently completed fiscal year, to our performance are as follows: •
Adjusted EBITDA; •
Comparable store sales growth; and •
Net sales. Analysis of the Information Presented in the Pay Versus Performance Table The Company is providing the following descriptions of the relationships between information presented in the Pay Versus Performance table, including “compensation actually paid”, as required by Item 402(v) of Regulation S-K. The Compensation Committee has not previously used or considered “compensation actually paid” as computed in accordance with Item 402(v) of Regulation S-K to set NEO target pay or align our NEO compensation to Company performance. See “Compensation Discussion and Analysis” for a discussion of how the Compensation Committee designs our executive compensation program and sets NEO target pay. | Page | | | 73 | | | Grocery Outlet 2023 Proxy Statement | | | | |
(12)
| Includes 39,592 shares directly held by the Alterman Revocable Trust, of which Mr. Alterman is a Trustee.
Named Executive Officer Compensation Tables
Compensation Actually Paid and Cumulative TSR; Cumulative TSR of the Company and Nasdaq US Benchmark General Retailers Index. As demonstrated by the following graph, the amount of compensation actually paid to Mr. Lindberg and the average amount of compensation actually paid to the Company’s NEOs as a group (excluding Mr. Lindberg) are aligned with the Company’s cumulative TSR over the three fiscal years presented in the table, which we believe is because a significant portion of the compensation actually paid to Mr. Lindberg and to the other NEOs is comprised of equity awards. As described in more detail in the section “Compensation Discussion and Analysis,” the Company’s NEO target total compensation in Fiscal Year 2022 included 83% of our Chief Executive Officer’s and 75% of our other NEO’s target total compensation comprised of variable compensation (with value ultimately tied to either the achievement of objective corporate goals or stock price performance, or both), and 67% and 60%, respectively, comprised of equity awards (RSUs and PSUs). Further, as demonstrated by the following graph, the Company’s cumulative TSR was generally lower than the TSR for the Nasdaq US Benchmark General Retailers Index over the three fiscal year period presented in the table. The Nasdaq US Benchmark General Retailers Index represents a published industry or line-of-business index and is not used by our Compensation Committee for purposes of determining target compensation for our NEOs. See “Compensation Discussion and Analysis” herein for the list of companies constituting our peer group for compensation benchmarking. Compensation Actually Paid and Net Income As demonstrated by the following graph, the amount of compensation actually paid to Mr. Lindberg and the average amount of compensation actually paid to the Company’s NEOs as a group (excluding Mr. Lindberg) are generally aligned with the Company’s net income over the three fiscal years presented in the table. The compensation program for our NEOs does not use net income as a financial performance measure; however, our adjusted EBITDA performance is correlated with net income. See “Compensation Actually Paid and Adjusted EBITDA” below. | Page | | | 74 | | | Grocery Outlet 2023 Proxy Statement | | | | |
(13)
| Includes 68,805 shares directly held by the Thomas F. Herman Separate Property Trust, of which Mr. Herman is a Trustee.
Named Executive Officer Compensation Tables
Compensation Actually Paid and Adjusted EBITDA As demonstrated by the following graph, the amount of compensation actually paid to Mr. Lindberg and the average amount of compensation actually paid to the Company’s NEOs as a group (excluding Mr. Lindberg) is aligned with the Company’s adjusted EBITDA over the three fiscal years presented in the table. In identifying adjusted EBITDA as the most important performance measure used by the Company to link compensation actually paid for the NEOs to performance for 2022, we considered that (1) 60% of the target bonus weighting of our AIP related to adjusted EBITDA for Fiscal Year 2022, and (2) 30% to 35% of our long-term equity incentives for Fiscal Year 2022 include PSUs based on adjusted EBITDA growth over a three-fiscal year performance period. | Page | | | 75 | | | Grocery Outlet 2023 Proxy Statement | | | | |
(14)
| Includes 612 shared held as fully vested deferred stock units under our Director Deferral Program.
Named Executive Officer Compensation Tables
| Page | | | 76 | | | Grocery Outlet 2023 Proxy Statement | | | | |
(15)
| Consists of (i) 3,242,319 shares issuable upon the exercise of options exercisable within 60 days following April 12, 2021; (ii) 1,787 shares held as fully vested deferred stock units under our Director Deferral Program; and (iii) 8,406,793 shares held by our current executive officers and directors. |
TABLE OF CONTENTS
EQUITY COMPENSATION PLAN INFORMATIONThe following table summarizes information about our equity compensation plans as of January 2, 2021. All outstanding awards relate to our common stock.
Equity Compensation Plans Approved by Stockholders(1) | | | 7,075,476(2) | | | $9.46(3) | | | 3,076,015(4) | Equity Compensation Plans Not Approved by Stockholders | | | — | | | — | | | — | Total | | | 7,075,476 | | | $9.46 | | | 3,076,015 |
(1)
| Consists of options and restricted stock unit awards issued under our 2019 Incentive Plan and our 2014 Stock Plan. Our 2014 Stock Plan terminated in June 2019 in connection with the adoption of the 2019 Incentive Plan.
CEO PAY RATIO We cannot issue any further awards under the 2014 Stock Plan. |
(2)
| Includes (i) 3,864,772 shares issuable in connection with time-based options, (ii) 2,325,580 shares issuable in connection with performance-based options, (iii) 341,842 shares issuable in connection with unvested restricted stock units, and (iv) 543,282 shares issuable in connection with PSUs (assuming maximum performance level). |
(3)
| Represents weighted average exercise price of outstanding options. Excludes restricted stock units, which have no exercise price. |
(4)
| Represents all shares available for future issuance under the 2019 Incentive Plan as of January 2, 2021. On the first day of each fiscal year beginning in Fiscal Year 2020 and ending in fiscal 2029, the 2019 Incentive Plan provides for an annual automatic increase of the shares reserved for issuance in an amount equal to the positive difference between (i) 4% of the outstanding common stock on the last day of the immediately preceding fiscal year and (ii) the plan share reserve on the last day of the immediately preceding fiscal year, or a lesser number as determined by our board of directors. Pursuant to this provision, on January 3, 2021, 718,158 new shares became available for issuance under the 2019 Incentive Plan. |
As required by Section 953(b) of the Dodd-Frank Wall Street Reform and Consumer Protection Act, and Item 402(u) of Regulation S-K, we are providing the following information regarding the ratio of the annual total compensation of Eric J. Lindberg, Jr., our Chief Executive Officer during Fiscal Year 2022, to the annual total compensation of our median employee.
For Fiscal Year 2022: | MEDIAN EMPLOYEE | | | The annual total compensation of our median compensated employee (other than our CEO) was $67,337 | | | CHIEF EXECUTIVE OFFICER | | | The annual total compensation of our CEO, as reported in the Summary Compensation Table above, was $5,330,287 | | | PAY RATIO | | | The annual total compensation of our CEO was approximately 79.2 times the annual total compensation of our median employee to the annual total compensation of Eric J. Lindberg, Jr., our Chief Executive Officer (our “CEO”). We consider the pay ratio specified below to be a reasonable estimate, calculated in a manner that is intended to be consistent with the requirements Item 402(u) of Regulation S-K.For Fiscal Year 2020:
1.
| the annual total compensation of the employee who represents our median compensated employee (other than our CEO) was $54,870; and |
2.
| the annual total compensation of our CEO, as reported in the Summary Compensation Table above, was $5,452,022. |
Based on this information, for Fiscal Year 2020, the annual total compensation of our CEO was approximately 99.4 times the median of the annual total compensation of all of our employees (other than the CEO).
This pay ratio is a reasonable estimate calculated in a manner consistent with SEC rules. Because the SEC rules for identifying the median compensated employee and calculating the pay ratio based on that employee’s annual total compensation allow companies to adopt a variety of methodologies, to apply certain exclusions, and to make reasonable estimates and assumptions that reflect their compensation practices, the pay ratio reported by other companies—including companies in our peer group—may not be comparable to the pay ratio reported above. Other companies may have different employment & compensation practices, different geographic breadth, perform different types of work, and may utilize different methodologies, exclusions, estimates and assumptions in calculating their own pay ratios. This information is being provided for compliance purposes. Neither the Compensation Committee nor management of the company used the pay ratio measure in making compensation decisions.
TABLE OF CONTENTS
Determining the Median Employee
Employee Population
The Company used our employee population data as of December 1, 2020 as the reference date for identifying our median employee. As of such date, our employee population consisted of approximately 960 individuals, approximately 70% of which were hourly employees, and all of whom were located in the United States. For purposes of the pay ratio calculation our employee population consists of all full- and part-time employees at all locations (other than our CEO)
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This pay ratio is a reasonable estimate calculated in a manner consistent with SEC rules based on the methodology described below. Because the SEC rules for identifying the median compensated employee and calculating the pay ratio based on that employee’s annual total compensation allow companies to adopt a variety of methodologies, to apply certain exclusions, and to make reasonable estimates and assumptions that reflect their compensation practices, the pay ratio reported by other companies—including companies in our peer group—may not be comparable to the pay ratio reported above. Further, other companies may have different employment and compensation practices, different geographic breadth, and have more or less employees at comparable skill and pay levels. This information is being provided for compliance purposes. Neither the Compensation Committee nor management of the Company used the pay ratio measure in making compensation decisions. Determining the Median Employee We had previously identified a median employee for disclosure in our 2021 proxy statement using the methodology set forth below. For purposes of determining our CEO pay ratio for Fiscal Year 2022, SEC rules allow us to use the same median employee (or comparable employee) for three years as long as there has been no change in our employee population or employee compensation programs that we reasonably believe would result in a significant change to our CEO pay ratio disclosure. We determined that there was no change in our employee population or employee compensation programs in Fiscal Year 2022 that would significantly impact our CEO pay ratio disclosure, and given that we determined to use the same median employee for this pay ratio calculation as we had used in the prior two fiscal years. EMPLOYEE POPULATION As previously disclosed, to identify our median employee in Fiscal Year 2020, we used our employee population data as of December 1, 2020 as the reference date. As of such date, our employee population consisted of approximately 960 individuals, approximately 70% of which were hourly employees and all of whom were located in the United States. For purposes of the pay ratio calculation, our employee population consists of all full- and part-time employees at all locations (other than our CEO), including all temporary employees employed as of the measurement date. METHODOLOGY FOR DETERMINING OUR MEDIAN EMPLOYEE To identify the median employee from our employee population, we used Box 1 Form W-2 earnings for Fiscal Year 2020 as reflected in our U.S. and local payroll records, which includes the value of all benefits and employee discounts provided to all employees on a non-discriminatory basis. In identifying the median employee, we annualized the compensation for full-time employees hired during the fiscal year, and we did not make any cost-of-living adjustments. Annual Total Compensation of Median Employee We calculated the median employee’s compensation for Fiscal Year 2022 on the same basis as required by the Summary Compensation Table, which includes the value of benefits provided to our median employee under non-discriminatory benefit plans available to all employees during Fiscal Year 2022. Methodology for Determining Our Median Employee
| Page | | | 77 | | | To identify the median employee from our employee population, we used Box 1 Form W-2 earnings for 2020 as reflected in our U.S. and local payroll records plus the value of all benefits and employee discounts provided to all employees on a non-discriminatory basis. In identifying the median employee, we did not make any cost-of-living adjustments.
Compensation Measure and Annual Total Compensation of Median Employee
With respect to the annual total compensation of the median employee, we calculated such employee’s compensation for 2020 in accordance with the requirements of Item 402(c)(2)(x) of Regulation S-K, plus, pursuant to SEC rules and to maintain consistency with the calculation of compensation for our CEO, we have elected to voluntarily include the value of benefits provided to our median employee under non-discriminatory benefit plans available to all employees during 2020, which includes, for this purpose, medical benefit premiums paid by the Company, educational reimbursement benefits and the value of employee discounts provided to the median employee during 2020. The value of these non-discriminatory benefits provided to our CEO (if applicable to him) during 2020 are also included in the annual total compensation of our CEO, as applicable, reported in our 2020 Summary Compensation Table above.
Annual Total Compensation of CEO
With respect to the annual total compensation of our CEO, we used the amount reported in the “Total” column of our 2020 Summary Compensation Table included in thisGrocery Outlet 2023 Proxy Statement which includes the value of benefits provided to our CEO under non-discriminatory benefit plans available to all employees during 2020.
| | | DELINQUENT SECTION 16(A) REPORTS![[MISSING IMAGE: lg_groceryoutlet-pn.jpg]](/files/DEF 14A/0001104659-23-053007/lg_groceryoutlet-pn.jpg) Section 16(a) of the Exchange Act requires the Company’s officers and directors and persons who own more than 10% of a registered class of the Company’s equity securities to file reports of ownership and changes in ownership with the SEC. Such officers, directors and stockholders are required by SEC regulations to furnish the Company with copies of all such reports that they file. Based solely on a review of copies of reports filed with the SEC and of written representations by officers and directors, the Company believes that during Fiscal Year 2020, all officers and directors subject to the reporting requirements of Section 16(a) filed the required reports on a timely basis, except that (i) Mr. Herman filed a late Form 4 on November 30, 2020 to report a sale on November 16, 2020; and (ii) Mr. Lindberg filed a late Form 4 on December 21, 2020 to report a stock option exercise and subsequent sale on December 16, 2020.
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Annual Total Compensation of CEO With respect to the annual total compensation of our CEO, we used the amount reported in the “Total” column of our 2022 Summary Compensation Table included in this Proxy Statement, which includes the value of benefits provided to our CEO under non-discriminatory benefit plans available to all employees during Fiscal Year 2022. | Page | | | 78 | | | 52 Grocery Outlet 2023 Proxy Statement
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CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS Related Persons Transaction Policy We have a written policy on transactions with related persons, which we refer to as our Related Person Policy. Our Related Person Policy requires the prompt disclosure to our General Counsel of any transaction in which we were or are to be a participant and the amount involved exceeds $120,000 and in which any related person had or will have a direct or indirect material interest, with a related person being a person (i) who is or was at any time since the beginning of our last fiscal year, a director, director nominee, or executive officer; (ii) who is the beneficial holder of more than 5% of any class of our voting securities; (iii) any of their immediate family members; or (iv) any entity owned or controlled by any of the foregoing persons. Our general counsel will communicate that information to our Audit and Risk Committee. Our Related Person Policy provides that no related person transaction will be executed without the approval or ratification of our Audit and Risk Committee. It is our policy that any directors interested in a related person transaction must recuse themselves from any vote on a related person transaction in which they have an interest. Related Party Transactions STOCKHOLDERS AGREEMENT On October 7, 2014, we entered into a stockholders agreement with an affiliate of H&F (referred to as the “H&F Investor”), certain executive officers and their family trusts, including Messrs. Lindberg, Read, Bracher and Wilson, and certain of our directors and their family trusts, including Messrs. Herman, Mathews and York. We amended and restated this stockholders agreement on June 19, 2019 in connection with our IPO. The Amended and Restated Stockholders Agreement provides, among other terms, that the Executive Stockholders (as defined in the Amended and Restated Stockholders Agreement) and the Read Trust Rollover Stockholders (as defined in the Amended and Restated Stockholders Agreement), trusts controlled by Mr. Lindberg, Mr. Read or members of their immediate family, acting together by majority vote, have the right to nominate one person (such person, the “Stockholder Nominee”) to our Board for so long as such stockholders collectively own at least 5% of outstanding shares of our common stock. The Amended and Restated Stockholders Agreement also provides that our Chief Executive Officer will be nominated to our Board. The Stockholder Nominee position was formerly filled by Mr. Read, then a Class II director and the Chief Executive Officer, Mr. Sheedy, is a Class III director. Pursuant to the Amended and Restated Stockholders Agreement, we will include the Stockholder Nominee (if one is designated) and the Chief Executive Officer nominee on the slate that is included in our proxy statement relating to the election of directors of the class to which such persons belong and provide the highest level of support for the election of each such person as we provide to any other individual standing for election as a director. In addition, each stockholder party to the Amended and Restated Stockholders Agreement agrees to vote in favor of the Company slate that is included in our proxy statement. In the event that the Stockholder Nominee ceases to serve as a director for any reason (other than the failure of our stockholders to elect such individual as a director), the persons entitled to designate such nominee director under the Amended and Restated Stockholders Agreement are entitled to appoint another nominee as a Class II director to fill the resulting vacancy. Since Mr. Read (as the former Stockholder Nominee) has ceased to serve as a director, the persons entitled to designate the Stockholder Nominee under the Amended and Restated Stockholders Agreement are entitled to appoint another nominee to that position, however, to date, have not done so. The Amended and Restated Stockholders Agreement contains provisions that entitle the Executive Stockholders and the Read Trust Rollover Stockholders to certain rights to have their securities registered by us under the Securities Act. | Page | | | 79 | | | Grocery Outlet 2023 Proxy Statement | | | | |
Certain Relationships and Related Party Transactions
INDEMNIFICATION OF DIRECTORS AND OFFICERS We have entered into an indemnification agreement with each of our directors and executive officers. The indemnification agreements, together with our amended and restated bylaws, provide that we will jointly and severally indemnify each indemnitee to the fullest extent permitted by the Delaware general corporation law from and against all loss and liability suffered and expenses, judgments, fines and amounts paid in settlement actually and reasonably incurred by or on behalf of the indemnitee in connection with any threatened, pending, or completed action, suit or proceeding. Additionally, we agree to advance to the indemnitee all out-of-pocket costs of any type or nature whatsoever incurred in connection therewith. LEASE ARRANGEMENTS As of April 28, 2023, we leased fourteen store properties and one distribution center from entities in which Messrs. Lindberg and Read, or their respective families, had a direct or indirect material interest. These entities received aggregate annual lease payments in Fiscal Year 2022 of $6.8 million (which amount includes revenue from one additional store property prior to January 1, 2023) and of $1.7 million in the 13 weeks ended April 1, 2023. The leases for seven of these stores expire in August 2024. The leases on the eight remaining properties expire on various dates between December 2025 and March 2037.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT The following table sets forth information about the beneficial ownership of the common stock of Grocery Outlet Holding Corp. as of April 24, 2023 for: •
each person known by us to own beneficially 5% or more of our outstanding shares of our common stock; •
each Named Executive Officer; •
each of our directors and nominees for director; and •
all of our executive officers and directors as a group. For each executive officer, director, or director nominee, information with respect to beneficial ownership is based upon information furnished to us by such person and for each person known by us to own beneficially 5% or more of our outstanding shares of our common stock, based on information reported in Schedules 13D or 13G filed with the SEC. We have determined beneficial ownership in accordance with the rules of the SEC. Under these rules, a person is deemed to be a “beneficial owner” of a security if that person has sole or shared “voting power,” which includes the power to vote or direct the voting of such security, or “investment power,” which includes the power to dispose of or to direct the disposition of such security. Common stock subject to stock options that are currently exercisable or exercisable within 60 days of April 24, 2023 and RSUs that vest within 60 days of April 24, 2023 are deemed to be outstanding and to be beneficially owned by the person holding the equity award for the purpose of computing the percentage ownership of that person but are not treated as outstanding for the purpose of computing the percentage ownership of any other person. Except as indicated by the footnotes below, and subject to applicable community property laws, we believe, based on the information furnished to us, that the persons and entities named in the table below have sole voting and dispositive power with respect to all common stock that they beneficially own. The percentages of beneficial ownership set forth below are based on 98,286,452 shares of our common stock outstanding as of April 24, 2023. Except as otherwise indicated in the footnotes below, the address of each beneficial owner is c/o Grocery Outlet Holding Corp., 5650 Hollis Street, Emeryville, California 94608. | NAME OF BENEFICIAL OWNER | | | SHARES BENEFICIALLY OWNED | | | PERCENTAGE BENEFICIALLY OWNED (%) | | | 5% Stockholders: | | | | | | | | | | | | | | | BlackRock, Inc.(1) | | | | | 9,492,161 | | | | | | 9.7 | | | | The Vanguard Group(2) | | | | | 8,825,894 | | | | | | 9.0 | | | | Capital Research Global Investors(3) | | | | | 8,619,895 | | | | | | 8.8 | | | | AllianceBernstein L.P.(4) | | | | | 5,445,064 | | | | | | 5.5 | | | | Jackson Square Partners, LLC(5) | | | | | 5,288,762 | | | | | | 5.4 | | | | Parnassus Investments, LLC(6) | | | | | 5,133,018 | | | | | | 5.2 | | | | Named Executive Officers and Directors: | | | | | | | | | | | | | | | Eric J. Lindberg, Jr.(7) | | | | | 4,629,571 | | | | | | 4.6 | | | | Charles C. Bracher(8) | | | | | 303,577 | | | | | | * | | | | Robert J. Sheedy, Jr.(9) | | | | | 241,419 | | | | | | * | | |
ELECTION OF DIRECTORS | Page | | | 81 | | | Grocery Outlet 2023 Proxy Statement | | | | |
Security Ownership of Certain Beneficial Owners and Management
| NAME OF BENEFICIAL OWNER | | | SHARES BENEFICIALLY OWNED | | | PERCENTAGE BENEFICIALLY OWNED (%) | | | Steven K. Wilson(10) | | | | | 244,501 | | | | | | * | | | | Pamela B. Burke(11) | | | | | 144,864 | | | | | | * | | | | Kenneth W. Alterman(12) | | | | | 72,463 | | | | | | * | | | | John E. Bachman | | | | | 10,035 | | | | | | * | | | | Mary Kay Haben(13) | | | | | 10,035 | | | | | | * | | | | Thomas F. Herman(14) | | | | | 33,553 | | | | | | * | | | | Carey F. Jaros | | | | | 7,734 | | | | | | * | | | | Norman S. Matthews(15) | | | | | 112,611 | | | | | | * | | | | Gail Moody-Byrd | | | | | 6,974 | | | | | | * | | | | Erik D. Ragatz(16) | | | | | 328,134 | | | | | | * | | | | Jeffrey R. York | | | | | 67,459 | | | | | | * | | | | All directors and executive officers as a group (17 persons)(17) | | | | | 6,241,785 | | | | | | 6.2 | | |
*
Indicates beneficial ownership of less than 1%. (1)
Based upon statements in a Schedule 13G/A filed by BlackRock, Inc. on February 7, 2023. The report includes holdings of various subsidiaries of the holding company, none of whom are reported to beneficially own more than 5% of our common stock. According to the Schedule 13G/A, BlackRock, Inc. has sole voting power over 8,928,183 of the reported shares, shared voting power over none of the reported shares, sole dispositive power over 9,492,161 of the reported shares and shared dispositive power over none of the reported shares. The address of BlackRock, Inc. is 55 East 52nd Street, New York, New York 10055. (2)
Based upon statements in a Schedule 13G/A filed by The Vanguard Group on February 9, 2023. According to the Schedule 13G/A, The Vanguard Group has sole voting power over none of the reported shares, shared voting power over 33,834 of the reported shares, sole dispositive power over 8,700,842 of the reported shares and shared dispositive power over 125,052 of the reported shares. The address of The Vanguard Group is 100 Vanguard Blvd., Malvern, Pennsylvania 19355. (3)
Based upon statements contained in a Schedule 13G/A filed by Capital Research Global Investors on February 13, 2023. According to the Schedule 13G/A, Capital Research Global Investors has sole voting power over all of the reported shares, shared voting power over none of the reported shares and sole dispositive power over all reported shares. The address of Capital Research Global Investors is 333 South Hope Street, 55th Fl, Los Angeles, California 90071. (4)
Based upon statements contained in a Schedule 13G filed by AllianceBernstein L.P. on February 14, 2023. According to the Schedule 13G, AllianceBernstein L.P. has sole voting power over 5,022,903 of the reported shares, shared voting power over none of the reported shares and sole dispositive power over 5,305,898 of the reported shares, and shared dispositive power over 139,166 of the reported shares. The address of AllianceBernstein L.P. is 1345 Avenue of the Americas, New York, New York 10105. (5)
Based upon statements contained in a Schedule 13G/A filed by Jackson Square Partners, LLC on February 10, 2023. According to the Schedule 13G/A, Jackson Square Partners, LLC has sole voting power over 4,247,541 of the reported shares, shared voting power over none of the reported shares and sole dispositive power over all reported shares. The address of Jackson Square Partners, LLC is One Letterman Drive, Building A, Suite A3-200, San Francisco, California 94129. (6)
Based upon statements contained in a Schedule 13G/A filed by Parnassus Investments LLC on February 2, 2023. According to the Schedule 13G Parnassus Investments LLC has sole voting and dispositive power over all of the reported shares. The address of Parnassus Investments LLC is 1 Market Street, Suite 1600, San Francisco, CA 94105. (7)
Consists of (i) 79,852 shares directly held by Mr. Lindberg, (ii) 2,020,629 shares issuable upon the exercise of options exercisable within 60 days following April 24, 2023 directly held by Mr. Lindberg, (iii) 460 shares directly held by Mr. Lindberg’s wife, (iv) 460 shares directly held by one of Mr. Lindberg’s children, (v) 2,126,670 shares directly held by the Lindberg Revocable Trust u/a/d 2/14/06 of which Mr. Lindberg is a Trustee, and (vi) 401,500 shares directly held by the Lindberg Irrevocable Trust u/a/d 5/12/17 of which Mr. Lindberg is a Trustee. Mr. Lindberg reports that he has sole voting and dispositive power over 2,100,481 shares and shared voting and dispositive power over 2,529,090 shares. (8)
Consists of (i) 79,360 shares held directly by Mr. Bracher, (ii) 1,410 shares directly held by Mr. Bracher’s spouse, and (iii) 222,807 shares issuable upon the exercise of options exercisable within 60 days following April 24, 2023. Not included in the table above are 1,200 shares held in a trust for Mr. Bracher’s children over which Mr. Bracher has no voting or investment power. At our Annual Meeting, stockholders will elect three Class II directors to hold office until our 2024 annual meeting of stockholders. Nominees were recommended and approved for nomination by our Nominating and Corporate Governance Committee. The directors shall serve until their successors have been duly elected and qualified or until any such director’s earlier resignation or removal. Proxies cannot be voted for a greater number of persons than the number of nominees named. If you sign and return the accompanying proxy, your shares will be voted “FOR” the election of the four nominees recommended by our board of directors, unless you mark the proxy in such a manner as to vote “WITHHOLD” with respect to one or more nominees. If any nominee for any reason is unable to serve or will not serve, the proxies may be voted for such substitute nominee as the proxy holder may determine. We are not aware of any nominee who will be unable to or will not serve as a director. | Page | | | 82 | | | Grocery Outlet 2023 Proxy Statement | | | | |
Security Ownership of Certain Beneficial Owners and Management
(9)
Consists of 59,915 shares held directly by Mr. Sheedy and 181,504 shares issuable upon the exercise of options exercisable within 60 days following April 24, 2023. (10)
Consists of 156,364 shares held directly by Mr. Wilson and 88,137 shares issuable upon the exercise of options exercisable within 60 days following April 24, 2023. (11)
Consists of 30,325 shares held directly by Ms. Burke and 114,539 shares issuable upon the exercise of options exercisable within 60 days following April 24, 2023. (12)
Consists of (i) 30,050 shares directly held by Mr. Alterman, (ii) 39,592 shares directly held by the Alterman Revocable Trust, of which Mr. Alterman is a Trustee and (iii) 2,821 shares held as fully vested DSUs under our Director Deferral Program. (13)
Consists of 3,061 shares directly held by Ms. Haben and 6,974 shares held as fully vested DSUs under our Director Deferral Program. (14)
Consists of 4,153 shares directly held by Mr. Herman, and 29,400 shares directly held by the Thomas F. Herman Separate Property Trust, of which Mr. Herman is a Trustee. (15)
Consists of (i) 25,897 shares directly held by Mr. Matthews, (ii) 73,849 shares held by The Matthews Family 2020 Trust dtd 11/24/2020 of which Mr. Matthews is a Trustee; and (iii) 12,865 shares held as fully vested DSUs under our Director Deferral Program. (16)
Consists of shares of (i) 20,996 shares held directly by Mr. Ragatz, (ii) 259,785 held by a limited partnership controlled by Mr. Ragatz; (iii) 5,200 shares directly held by Mr. Ragatz’ spouse; (iv) 38,000 shares held by a 401(K) (not affiliated with the Company); and (v) 4,153 shares held as fully vested DSUs under our Director Deferral Program (17)
Includes (i) 2,633,039 shares issuable upon the exercise of options exercisable within 60 days following April 24, 2023; and (ii) 3,720 shares held as fully vested DSUs under our Director Deferral Program. SECURITIES AUTHORIZED FOR ISSUANCE UNDER EQUITY COMPENSATION PLANS The following table summarizes information about our equity compensation plans as of December 31, 2022. All outstanding awards relate to our common stock. | PLAN CATEGORY | | | NUMBER OF SECURITIES TO BE ISSUED UPON EXERCISE OF OUTSTANDING EQUITY AWARDS (A) | | | WEIGHTED-AVERAGE EXERCISE PRICE OF OUTSTANDING EQUITY AWARDS (B) | | | NUMBER OF SECURITIES REMAINING AVAILABLE FOR FUTURE ISSUANCE UNDER EQUITY COMPENSATION PLANS (EXCLUDING SECURITIES REFLECTED IN COLUMN (A)) (C) | | | Equity Compensation Plans Approved by Stockholders(1) | | | | | 5,841,682(2) | | | | | $ | 10.36(3) | | | | | | 2,795,328(4) | | | | Equity Compensation Plans Not Approved by Stockholders | | | | | — | | | | | | — | | | | | | — | | | | Total | | | | | 5,841,682 | | | | | $ | 10.36 | | | | | | 2,795,328 | | |
(1)
Consists of options, RSUs and PSUs issued under our 2019 Incentive Plan and our 2014 Stock Plan. For the PSUs included in this number, maximum achievement levels were used. The actual number of shares of our common stock issuable will be determined at the time of vesting and could be less. Our 2014 Stock Plan terminated in June 2019 in connection with the adoption of the 2019 Incentive Plan. We cannot issue any further awards under the 2014 Stock Plan. (2)
Includes (i) 2,562,774 shares of our common stock issuable in connection with time-based options, (ii) 801,635 shares of our common stock issuable in connection with performance-based options, (iii) 677,895 shares of our common stock issuable in connection with unvested time-based RSUs, (iv) 38,826 shares of our common stock issuable in connection with DSUs under the Director Deferral Program and (v) 1,760,552 shares of our common stock issuable in connection with PSUs (assuming target performance level). (3)
Represents weighted average exercise price of outstanding options. Excludes RSUs and PSUs, which have no exercise price. (4)
Represents all shares of our common stock available for future issuance under the 2019 Incentive Plan as of December 31, 2022. On the first day of each fiscal year beginning in Fiscal Year 2020 and ending in fiscal 2029, the 2019 Incentive Plan provides for an annual automatic increase of the shares of our common stock reserved for issuance in an amount equal to the positive difference between (i) 4% of the Outstanding Common Stock (as defined in the 2019 Incentive Plan) on the last day of the immediately preceding fiscal year and (ii) the plan share reserve on the last day of the immediately preceding fiscal year, or a lesser number as determined by our Board. Pursuant to this provision, on January 1, 2023, 429,826 new shares of our common stock became available for issuance under the 2019 Incentive Plan. | Page | | | 83 | | | Grocery Outlet 2023 Proxy Statement | | | | |
PROPSALS FOR CONSIDERATION AT ANNUAL MEETING Proposal 1—Election of Class I Directors At our Annual Meeting, stockholders will elect four Class I directors to hold office until our 2026 annual meeting of stockholders. The following directors are being nominated for re-election to our Board: Kenneth W. Alterman, John E. Bachman, Thomas F. Herman, and Erik D. Ragatz. These nominees were recommended by our Nominating and Corporate Governance Committee and approved for nomination by our Board. Biographical information regarding the nominees and information regarding the qualifications of the nominees appears under the heading “Corporate Governance and Board Matters—Directors as of the Record Date”. Our Nominating and Corporate Governance Committee and Board believes that each director nominee has the requisite experience, qualification, personal and professional integrity, and diversity of background and understands our business and industry. Our Board believes that each director nominee has demonstrated the willingness and the ability to dedicate adequate time and attention to fulfill the responsibilities required as a director. The Board has determined that Messrs. Alterman, Bachman, Herman and Ragatz are independent directors. The directors will serve until their successors have been duly elected and qualified, or until any such director’s earlier resignation, retirement or other termination of service. The individuals named as proxies in the form of proxy solicited by our Board intend to vote the represented shares of our common stock for such nominees, unless otherwise instructed on the form of proxy. Proxies cannot be voted for a greater number of persons than the number of nominees named. If any nominee for any reason is unable to serve or will not serve, the proxies may be voted for such substitute nominee as the proxy holder may determine. Alternatively, the Board may reduce the size of the Board and, therefore, the number of directors to be elected. If any substitute nominee is designated, we will file amended proxy materials that, as applicable, identify any substitute nominee, disclose that such nominee has consented to being named in the revised proxy statement and to serve if elected, and include certain biographical and other information about such nominee as required by the rules of the SEC. We are not aware of any nominee who will be unable to or will not serve as a director. Voting, Election and Conditional Resignations. Our Amended and Restated Bylaws provides that in an uncontested director election, a director nominee will be elected to the Board by the stockholders only if the votes cast “FOR” such nominee’s election exceed the votes cast “AGAINST” such nominee’s election. Although counted for quorum purposes, abstentions, withheld votes, and broker non-votes, if any, will not be included in the total number of votes cast or be counted as votes for or against any nominee’s election. If a nominee who currently serves as a director is not re-elected, Delaware law provides that the director would continue to serve on the Board as a “holdover director.” Under our Corporate Governance Guidelines, we maintain a director resignation policy which provides for the contingent resignation of a director who receives more “against” votes than “for” votes in an uncontested director election, as well as the process of the Nominating and Corporate Governance Committee and the Board to review such resignation offer and publicly disclose the Board’s decision on whether to accept such offer. | | The following directors are being nominated for election to our board of directors: Mary Kay Haben, Gail Moody-Byrd, S. MacGregor Read, Jr., and Jeffrey York. Please see the discussion under “Board of Directors” in this Proxy Statement for information concerning each of our nominees for director. Required Vote
Our bylaws provide for a plurality voting standard for the election of directors. Under this voting standard, once a quorum has been established, the nominees who receive the largest number of votes are elected as directors up to the maximum number of directors to be elected at the meeting. This meansBoard unanimously recommends that the four nominees receiving the highest number of votes at the Annual Meeting will be elected, even if these votes do not constitute a majority of the votes cast. Only votes cast “FOR” a nominee will be counted in the election of directors. Votes that are “WITHHELD” with respect to one or more nominees will result in those nominees receiving fewer votes but will not count as astockholders vote against the nominees.
The board of directors recommends a vote “FOR”“FOR” the election of each of the nominated Class I directors.
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Proposals for Consideration at Annual Meeting
Proposal 2—Ratification of Independent Registered Public Accounting Firm The Audit and Risk Committee has re-appointed Deloitte & Touche LLP to serve as our independent registered public accounting firm for Fiscal Year 2023. Deloitte & Touche LLP has served as the independent auditor of the Company since 2007. In Fiscal Year 2022, its services included providing a report on the Company’s consolidated financial statements as of the end of and for Fiscal Year 2022 and on the effectiveness of the Company’s internal control over financial reporting as of the end of Fiscal Year 2022. In determining that retaining Deloitte & Touche LLP for Fiscal Year 2023 was in the best interests of the Company and its stockholders, our Audit and Risk Committee reviewed: •
The significant benefits from Deloitte’s extensive historical experience, including: –
Higher quality audit work and accounting advice due to Deloitte’s institutional knowledge of and familiarity with our business and operations, accounting policies and financial systems, and internal control framework; and –
Operational efficiencies and a resulting reasonable fee structure reflecting Deloitte’s history and familiarity with our business; •
The positive assessment of management and the Audit and Risk Committee regarding Deloitte’s performance of services during Fiscal Year 2022; •
Deloitte’s qualifications, independence, capabilities and expertise, evident through its audit planning and reports, industry knowledge, resources and staffing, objectivity and professional skepticism; •
Deloitte’s rigorous process for monitoring and maintaining independence, and its transparent disclosure regarding related considerations; and •
The quality and frequency of Deloitte’s communications to and interactions with the Committee, including the Chair, at meetings and between meetings. The fees paid to Deloitte & Touche for services rendered for Fiscal Years 2021 and 2022 can be found under the heading “Other Audit and Risk Committee Matters” above. The Company is not required by its Amended and Restated Bylaws or applicable law to submit the appointment of Deloitte & Touche for stockholder approval. However, as a matter of good corporate governance, the Board has determined to submit the Audit and Risk Committee’s appointment of Deloitte & Touche as our independent registered public accounting firm for Fiscal Year 2023 to stockholders for ratification. If stockholders do not ratify the appointment of Deloitte & Touche, the Audit and Risk Committee may consider such vote when determining whether to appoint our independent registered public accounting firm in the future, or determine to appoint another independent registered public accounting firm. In addition, even if stockholders ratify the Audit and Risk Committee’s selection, the Audit and Risk Committee, in its discretion, may appoint a different independent registered public accounting firm if it believes that such a change would be in the best interests of the Company and our stockholders. A representative of Deloitte & Touche is expected to attend the 2023 Annual Meeting. The representative will have the opportunity to make a statement if he or she desires to do so, and is expected to be available to answer appropriate questions from stockholders. TABLE OF CONTENTS
RATIFICATION OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
| | The Audit and Risk Committee has appointed Deloitte & Touche LLP to serve as our independent registered public accounting firm for the fiscal year ending January 1, 2022. The Company is not required by its bylaws or applicable law to submit the appointment of Deloitte & Touche LLP for stockholder approval. However, as a matter of good corporate governance, the board of directors has determined to submit the Audit and Risk Committee’s appointment of Deloitte & Touche LLP as our independent registered public accounting firm to stockholders for ratification. If stockholders do not ratify the appointment of Deloitte & Touche LLP, the Audit and Risk Committee may consider the appointment of another independent registered public accounting firm. In addition, even if stockholders ratify the Audit and Risk Committee’s selection, the Audit and Risk Committee, in its discretion, may appoint a different independent registered public accounting firm if it believes that such a change would be in the best interests of the Company and our stockholders. Required Vote
The affirmative vote of a majority of votes cast is required to ratify the appointment of Deloitte & Touche LLP as our independent registered public accounting firm for the fiscal year ending January 1, 2022.
The board of directorsBoard unanimously recommends that youthe stockholders vote “FOR” ratification of“FOR” Proposal 2 to ratify the appointment of Deloitte & Touche LLP as the Company’s independent registered public accounting firm for the fiscal year ending January 1, 2022.
A representative of Deloitte & Touche LLP is expected to attend the Annual Meeting. The representative will have the opportunity to make a statement if he or she desires to do so, and is expected to be available to answer appropriate questions from stockholders.
Fee Information
The following table sets forth fees in connection with services rendered by Deloitte & Touche LLP, the Company’s independent registered public accounting firm, for Fiscal Year 2020 and Fiscal Year 2019.2023.
Audit Fees | | | $2,402,790 | | | $3,237,693 | Audit-Related Fees | | | $— | | | $90,000 | Tax Fees | | | $290,875 | | | $214,693 | All Other Fees | | | $1,895 | | | $3,790 | Total Fees | | | $2,695,560 | | | $3,546,176 |
Audit Fees
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Audit fees include fees for professional services rendered in connection with the annual audit of the Company’s financial statements and the review of the Company’s interim financial statements included in quarterly reports, as well as fees for services that generally only the independent registered public accounting firm can be reasonably expected to provide, including comfort letters, consents, and review of registration statements filed with the SEC. | Page | | | 85 | | | Grocery Outlet 2023 Proxy Statement | | | Audit-Related Fees![[MISSING IMAGE: lg_groceryoutlet-pn.jpg]](/files/DEF 14A/0001104659-23-053007/lg_groceryoutlet-pn.jpg) | |
Proposals for Consideration at Annual Meeting
Proposal 3—Advisory (Non-Binding) Vote to Approve the Company’s Named Executive Officer Compensation We are asking our stockholders to indicate their support for our Named Executive Officers’ compensation as described in this Proxy Statement as required by Section 14A of the Exchange Act. This proposal, commonly known as a “say-on-pay” proposal, gives our stockholders the opportunity to express their views on our Named Executive Officers’ compensation. This vote is not intended to address any specific item of compensation, but rather the overall compensation of our Named Executive Officers and the philosophy, policies and practices described in this Proxy Statement. In a non-binding advisory vote on the frequency of the say-on-pay proposal held at our 2020 annual meeting of stockholders, a majority of stockholders voted in favor of holding say-on-pay votes annually. In light of this result and other factors, our Board determined that we would hold advisory say-on-pay votes on an annual basis until the next required advisory vote on such frequency, which must be held no later than the 2026 annual meeting of stockholders. As described in detail under the heading “Compensation Discussion and Analysis,” our executive compensation programs are designed to attract, develop, motivate, and retain our Named Executive Officers, who are critical to our success. Under these programs, our Named Executive Officers are rewarded for the achievement of specific annual, long-term and strategic goals, corporate goals, and the realization of increased stockholder value. Please read the “Compensation Discussion and Analysis” for additional details about our executive compensation programs, including information about the Fiscal Year 2022 compensation of our Named Executive Officers. Our Board requests your advisory vote on the following resolution at the 2023 Annual Meeting: RESOLVED, that the compensation paid to the Named Executive Officers, as disclosed in this Proxy Statement pursuant to the SEC’s executive compensation disclosure rules (which disclosure includes the Compensation Discussion and Analysis, the compensation tables and the narrative discussion that accompanies the compensation tables), is hereby approved. This “say-on-pay” vote is advisory, and therefore not binding on the Company, the Compensation Committee or our Board. Our Board and our Compensation Committee value the opinions of our stockholders and to the extent there is any significant vote against the Named Executive Officer compensation as disclosed in this Proxy Statement, we will consider our stockholders’ concerns and the Compensation Committee will evaluate whether any actions are necessary to address those concerns. | | Audit-related fees in 2019 include fees for professional services rendered in connection with planning for Fiscal Year 2020 SOX compliance.
Tax Fees
Tax fees include fees for professional services rendered for tax compliance and tax consultation.
All Other Fees
All other fees include fees for a technical research tool subscription service.
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Audit Committee Pre-Approval Policies and Procedures
Under our Audit and Risk Committee’s charter, the Audit and Risk Committee must pre-approve all audit and other permissible non-audit services proposed to be performed by the Company’s independent registered public accounting firm. The Committee may delegate authority to one or more independent members to grant pre-approvals of audit and permitted non-audit services; provided that any such preapprovals shall be presented to the full Committee at its next scheduled meeting. The following shall be “prohibited non-audit services”: (i) bookkeeping or other services related to the accounting records or financial statements of the Company; (ii) financial information systems design and implementation; (iii) appraisal or valuation services, providing fairness opinions or preparing contribution-in-kind reports; (iv) actuarial services; (v) internal audit outsourcing services; (vi) management functions or human resources; (vii) broker or dealer, investment adviser or investment banking services; (viii) legal services and expert services unrelated to the audit; and (ix) any other serviceBoard unanimously recommends that the PCAOB prohibits through regulation. Notwithstanding the foregoing, pre-approval is not necessary for minor non-audit services if: (i) the aggregate amount of all such non-audit services providedstockholders vote “FOR” Proposal 3 to the Company constitutes not more than five percent of the total amount of revenues paid by the Company to its registered public accounting firm during the fiscal year in which the non-audit services are provided; (ii) such services were not recognized by the Company at the time of the engagement to be non-audit services; and (iii) such services are promptly brought to the attention of the Committee and approved prior to the completion of the audit by the Committee or by one or more members of the Committee who are members of the board of directors to whom authority to grant such approvals has been delegated by the Committee.
All of the services provided by Deloitte & Touche described above were approved by our Audit and Risk Committee. The Audit and Risk Committee approved a pre-approval policy for services provided by the independent registered public accounting firm. Under the policy, our Audit and Risk Committee has pre-approved the provision by the independent registered public accounting firm of certain services that fall within specified categories. Any services exceeding pre-approved cost levels or budgeted amounts, or any services that fall outside of the general pre-approved categories, require specific pre-approval by the Audit and Risk Committee.
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ADVISORY (NON-BINDING) VOTE TO APPROVE
THE COMPANY’S NAMED EXECUTIVE OFFICER COMPENSATION
The Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (the “Dodd-Frank Act”) enables our stockholders to vote to approve on an advisory (non-binding) basis, the compensation of our Named Executive Officers, as disclosed in this Proxy Statement in accordance withpursuant to the SEC’s rules.rules of the SEC.
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As described in detail under | Page | | | 86 | | | Grocery Outlet 2023 Proxy Statement | | | | |
ADDITIONAL INFORMATION Frequently Asked Questions About the Proxy Materials and the Annual Meeting WHEN AND WHERE WILL THE MEETING TAKE PLACE? The 2023 Annual Meeting will be held on Monday, June 20, 2023 at 11:00 a.m. Pacific Daylight Time. The 2023 Annual Meeting will again be a virtual meeting of stockholders. You will be able to attend the 2023 Annual Meeting from any location with Internet connectivity and submit your questions during the meeting via live webcast by visiting www.virtualshareholdermeeting.com/GO2023. To participate in the meeting, you must have the sixteen-digit number that is shown on your Notice of Internet Availability of Proxy Materials or on your proxy card or voting instruction form (if you elected to receive proxy materials by mail). Online access to the 2023 Annual Meeting will begin at 10:45 a.m. Pacific Daylight Time on June 20, 2023. We encourage our stockholders to access the meeting prior to the start time. HOW DO STOCKHOLDERS PARTICIPATE IN THE VIRTUAL MEETING? To participate in the meeting, you must have the 16-digit number that is shown on your Notice of Internet Availability of Proxy Materials or on your proxy card or voting instruction form if you elected to receive proxy materials by mail. You may access the 2023 Annual Meeting by visiting www.virtualshareholdermeeting.com/GO2023. We will have technicians ready to assist you with any technical difficulties you may have accessing the virtual meeting or submitting questions. If you encounter any difficulties accessing the virtual meeting during the check-in or meeting time, please call the technical support number that will be posted on the virtual meeting login page. If you are a stockholder of record, appointing a proxy in response to this solicitation will not affect your right to attend the 2023 Annual Meeting and to vote during the 2023 Annual Meeting. Please note that if you hold your common stock in “street name” (that is, through a broker, bank or other intermediary), you will receive instructions from your broker, bank or other nominee that you must follow to have your shares of our common stock voted. This virtual meeting will provide the same rights and advantages that would be provided by a physical meeting. Stockholders will be able to present questions online during the meeting, providing our stockholders with the opportunity for meaningful engagement with the Company. We will spend up to 15 minutes answering stockholder questions that comply with the meeting rules of procedure. The rules of procedure will be posted on the virtual meeting web portal. If we receive substantially similar questions, we will group such questions together and provide a single response to avoid repetition. WHY DID I RECEIVE ONLY A NOTICE OF INTERNET AVAILABILITY OF PROXY MATERIALS? As permitted by the SEC, the Company is furnishing to stockholders its notice of the 2023 Annual Meeting (the “Notice”), this Proxy Statement and the 2022 Annual Report primarily over the Internet. On or about April 28, 2023, we will mail to each of our stockholders of record (other than those who previously requested electronic delivery or previously elected to receive delivery of a paper copy of the proxy materials) a Notice of Internet Availability of Proxy Materials (the “Notice of Internet Availability”) containing instructions on how to access and review the proxy materials via the Internet and how to submit a proxy electronically using the Internet. The Notice of Internet Availability also contains instructions on how to receive, free of charge, paper copies of the proxy materials. If you received the Notice of Internet Availability, you will not receive a paper copy of the proxy materials unless you request one. We believe the delivery options that we have chosen will allow us to provide our stockholders with the proxy materials they need, while minimizing the environmental impact and the cost of printing and mailing paper copies. WHAT IS THE PURPOSE OF THIS MEETING AND WHAT ARE THE VOTING RECOMMENDATIONS OF THE BOARD OF DIRECTORS? We are providing these proxy materials in connection with the solicitation by our Board of proxies to be voted at the 2023 Annual Meeting and any adjournment or postponement of the meeting. | Page | | | 87 | | | Grocery Outlet 2023 Proxy Statement | | | | |
At the 2023 Annual Meeting, you will be asked to vote on the following matters and the Board recommends you vote your shares of our common stock as follows: | PROPOSAL | | | VOTING ALTERNATIVES | | | BOARD RECOMMENDATION | | | 1
Election of Class I directors to hold office until the heading “Compensation Discussion and Analysis,”2026 annual meeting of stockholders | | | FOR or AGAINST the election of each of the Class I director nominees named herein ABSTAIN from voting on the matter | | | FOR each director nominee | | | 2
Ratification of appointment of Deloitte & Touche LLP as our executive compensation programs are designedindependent registered public accounting firm for Fiscal Year 2023 | | | FOR or AGAINST the ratification of the appointment of Deloitte & Touche LLP as our independent registered public accounting firm for Fiscal Year 2023 ABSTAIN from voting on the matter | | | FOR | | | 3
Advisory (non-binding) vote to attract, develop, motivate, and retainapprove our Named Executive Officers, who are criticalOfficer compensation | | | FOR or AGAINST the advisory vote to our success. Under these programs,approve our Named Executive Officers are rewarded for the achievement of specific annual, long-term and strategic goals, corporate goals, and the realization of increased stockholder value. Please read the “Compensation Discussion and Analysis” for additional details about our executiveOfficer compensation programs, including information about the Fiscal Year 2020 compensation of our Named Executive Officers. We are asking our stockholders to indicate their support for our Named Executive Officers’ compensation as described in this Proxy Statement. This proposal, commonly known as a “say-on-pay” proposal, gives our stockholders the opportunity to express their views on our Named Executive Officers’ compensation. This vote is not intended to address any specific item of compensation, but rather the overall compensation of our Named Executive Officers and the philosophy, policies and practices described in this Proxy Statement.
In accordance with the requirements of Section 14A of the Exchange Act (which was added by the Dodd-Frank Act) and the related rules of the SEC, our board of directors requests your advisory voteABSTAIN from voting on the following resolution atmatter
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WHAT VOTE IS REQUIRED TO APPROVE EACH PROPOSAL AT THE ANNUAL MEETING? | | | | | | | VOTE IMPACT | | | PROPOSAL NO. | | | VOTE REQUIRED | | | FOR | | | AGAINST | | | ABSTAIN | | | BROKER NON-VOTES | | | Proposal No. 1 | | | Majority of Shares Cast | | | For the Annual Meeting:RESOLVED, thatdirector nominee(s)
| | | Against the compensation paid to the Named Executive Officers, as disclosed in this Proxy Statement pursuant to the SEC’s executive compensation disclosure rules (which disclosure includes the Compensation Discussion and Analysis, the compensation tables and the narrative discussion that accompanies the compensation tables), is hereby approved.This “say-on-pay” vote is advisory, and therefore not binding on the Company, the Compensation Committee or our board of directors. Our board of directors and our Compensation Committee value the opinions of our stockholders and to the extent there is any significant vote against the Named Executive Officer compensation as disclosed in this Proxy Statement, we will consider our stockholders’ concerns and the Compensation Committee will evaluate whether any actions are necessary to address those concerns.
The board of directors recommendsdirector nominee(s)
| | | Not a vote “FOR”cast | | | Not a vote cast | | | Proposal No. 2 | | | Majority of Shares Present or Represented and Entitled to Vote | | | For the approvalproposal | | | Against the proposal | | | Against the proposal | | | — | | | Proposal No. 3 | | | Majority of Shares Present or Represented and Entitled to Vote | | | For the compensation ofproposal | | | Against the Named Executive Officers as disclosed in thisproposal | | | Against the proposal | | | Not entitled to vote | |
Voting, Election and Conditional Resignations. With respect to Proposal No. 1, our Amended and Restated Bylaws provides that in an uncontested director election, a director nominee will be elected to the Board by the stockholders only if the votes cast “FOR” such nominee’s election exceed the votes cast “AGAINST” such nominee’s election. Although counted for quorum purposes, abstentions, withheld votes, and broker non-votes, if any, will not be included in the total number of votes cast or be counted as votes for or against any nominee’s election. Proxies may not be voted for more than four directors and stockholders may not cumulate votes in the election of directors. If a nominee who currently serves as a director is not re-elected, Delaware law provides that the director would continue to serve on the Board as a “holdover director.” Under our Corporate Governance Guidelines, we maintain a director resignation policy which provides for the contingent resignation of a director who receives more “against” votes than “for” votes in an uncontested director election, as well as the process of the Nominating and Corporate Governance Committee and the Board to review such resignation offer and publicly disclose the Board’s decision on whether to accept such offer. | Page | | | 88 | | | Grocery Outlet 2023 Proxy Statement pursuant to Item 402 of Regulation S-K under the Securities Exchange Act of 1934, including the Compensation Discussion and Analysis, the compensation tables and narrative discussion that accompanies the compensation tables. | | | | |
ARE ALL OF THE COMPANY’S DIRECTORS STANDING FOR ELECTION TO THE BOARD OF DIRECTORS AT THE ANNUAL MEETING? No, only our Class I directors are standing for re-election at this time. Our Class II directors will stand for election in 2024 and our Class III directors will stand for election in 2025. Beginning with the annual meeting of stockholders in 2026, each director will be elected for one-year terms. WHO IS ENTITLED TO VOTE AT THE ANNUAL MEETING? If at the close of business on the record date, April 24, 2023, you were a stockholder of record or held shares through a bank, broker or other intermediary, you may vote your shares of our common stock on the matters presented at the 2023 Annual Meeting. You have one vote for each share of our common stock that you owned at the close of business on the record date. As of that date, there were 98,286,452 shares of our common stock outstanding entitled to vote. There is no other class of voting securities outstanding. WHAT IS THE DIFFERENCE BETWEEN HOLDING SHARES AS A STOCKHOLDER OF RECORD AND HOLDING SHARES AS A BENEFICIAL OWNER? Key distinctions between shares held of record and those owned beneficially are summarized below. Stockholder of Record If your shares of our common stock are registered directly in your name with our transfer agent, American Stock Transfer & Trust Company, LLC, you are considered to be the stockholder of record with respect to those shares, and we have sent the Notice of Internet Availability directly to you. As a stockholder of record, you have the right to grant your voting proxy directly to us or to vote during the live webcast of the 2023 Annual Meeting. However, even if you plan to attend the 2023 Annual Meeting, we recommend that you vote your shares in advance, so that your vote will be counted if you later decide not to attend the 2023 Annual Meeting. Beneficial Owner Stockholders If you hold your shares of our common stock through a bank, broker or other intermediary, you are considered to be the beneficial owner of shares held in “street name,” and the Notice of Internet Availability has been forwarded to you by your bank, broker, or intermediary (which is considered to be the stockholder of record with respect to those shares). Most of our stockholders are beneficial owner stockholders. As a beneficial owner, you have the right to direct your bank, broker, or intermediary on how to vote. Your bank, broker, or intermediary has sent you a voting instruction form for you to use in directing the bank, broker, or intermediary regarding how to vote your shares. The availability of online voting during the meeting for beneficial stockholders may depend on the voting procedures of the organization that holds your shares. Please instruct your broker, bank, or other nominee how to vote your shares using the voting instruction form you received from them. Even if you plan to attend the 2023 Annual Meeting, we recommend that you vote your shares in advance, so that your vote will be counted if you later decide not to attend the 2023 Annual Meeting. WHAT OPTIONS ARE AVAILABLE TO ME TO VOTE MY SHARES? Whether you hold shares directly as the stockholder of record or indirectly through a bank, broker, or other intermediary, your shares of our common stock may be voted by following any of the voting options available to you below: You may vote via the Internet. •
You can submit your proxy or voting instructions over the Internet by following the instructions provided in the Notice of Internet Availability or, if you received a printed set of the proxy materials by mail, on the proxy card or voting instruction form. You may vote via the telephone. •
If you are a stockholder of record, you can submit your proxy by calling the telephone number specified on the paper copy of the proxy card you received if you received a printed set of the proxy materials. You must have the control number that appears on your proxy card available when submitting your proxy over the telephone. | Page | | | 89 | | | 56 Grocery Outlet 2023 Proxy Statement
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Most beneficial owner stockholders (also referred to as holding shares in “street name”) may submit voting instructions by calling the number specified on the paper copy of the voting instruction form provided by their bank, broker, or other intermediary. Those stockholders should check the voting instruction form for telephone voting instructions and availability. You may vote by mail. •
If you received a printed set of the proxy materials, you can submit your proxy or voting instructions by completing and signing the separate proxy card or voting instruction form you received and mailing it in the accompanying prepaid and addressed envelope. You may vote during the meeting. •
Stockholders of record may vote while attending the 2023 Annual Meeting via live webcast while the polls remain open by visiting www.virtualshareholdermeeting.com/GO2023. You will need your 16-digit number found in the Notice of Internet Availability or your proxy card. If you are the beneficial owner of shares holding your shares through a bank, broker, or other intermediary, you should receive separate instructions from the holder of record of your common stock describing how you can vote that stock. Even if you plan to attend the 2023 Annual Meeting, we recommend that you submit your proxy or voting instructions in advance to authorize the voting of your shares of our common stock at the 2023 Annual Meeting. This will ensure that your vote will be counted if you later are unable to attend. WHAT IF I DON’T VOTE FOR SOME OF THE ITEMS LISTED ON MY PROXY CARD OR VOTING INSTRUCTION FORM? If you properly execute and return your proxy card but do not mark selections, your shares of our common stock will be voted in accordance with the recommendations of our Board. If you indicate a choice with respect to any matter to be acted upon on your proxy card, your shares of our common stock will be voted in accordance with your instructions. If you are a beneficial owner and hold your shares in street name through a bank, broker, or other intermediary and do not give voting instructions to the bank, broker, or intermediary, the bank, broker, or other intermediary, as applicable, will determine if it has the discretionary authority to vote on the particular matter. Under applicable rules, brokers have the discretion to vote on routine matters (sometimes referred to as “broker discretionary voting”), such as the ratification of the appointment of an independent registered public accounting firm, but do not have discretion to vote on non-routine matters, including the election of directors and the advisory vote to approve named executive officer compensation. Our Proposal 2 (ratification of the appointment of our independent registered public accounting firm for Fiscal Year 2022) is the only proposal in this Proxy Statement that is considered a routine matter. The other proposals are not considered routine matters, and without your instructions, your broker cannot vote your shares. If you do not provide voting instructions to your broker, and your broker indicates on its proxy card that it does not have discretionary authority to vote on a particular proposal, your shares of our common stock will be considered to be “broker non-votes” with regard to that matter. If you are a stockholder of record, then your shares of our common stock will not be voted if you do not provide your proxy, unless you attend the live webcast and vote online during the 2023 Annual Meeting. HOW IS A QUORUM DETERMINED? The representation, at the 2023 Annual Meeting or by proxy, of holders entitled to cast at least a majority of the votes entitled to be cast at the 2023 Annual Meeting constitutes a quorum at the 2023 Annual Meeting. Shares represented by proxy or voting instructions are considered present and entitled to vote for purposes of establishing a quorum for the transaction of business at the 2023 Annual Meeting. If a quorum is not present by attendance at the 2023 Annual Meeting or represented by proxy, the stockholders present by attendance at the meeting or by proxy may adjourn the meeting, until a quorum is present. If a new record date is fixed for the adjourned meeting, we will provide notice of the adjourned meeting to each stockholder of record entitled to vote at the meeting. | Page | | | 90 | | | Grocery Outlet 2023 Proxy Statement | | | | |
CAN I CHANGE MY VOTE OR REVOKE MY PROXY? Yes. Any stockholder of record has the power to change or revoke a previously submitted proxy at any time before it is voted at the 2023 Annual Meeting by: •
Submitting to our Corporate Secretary, before the voting at the 2023 Annual Meeting, a written notice of revocation bearing a later date than the proxy; •
Timely delivery of a valid, later-dated proxy (only the last proxy submitted by a stockholder by Internet, telephone or mail will be counted); or •
Attending the 2023 Annual Meeting and voting during the live webcast while the polls are open; however, attendance at the 2023 Annual Meeting will not by itself constitute a revocation of a proxy. For shares held in street name, you may revoke any previous voting instructions by submitting new voting instructions to the bank, broker, or intermediary holding your shares by the deadline for voting specified in the voting instructions provided by your bank, broker, or intermediary. ARE THERE OTHER MATTERS TO BE VOTED ON AT THE 2023 ANNUAL MEETING? We do not know of any other matters that may come before the 2023 Annual Meeting other than Proposals 1, 2 and 3 included herein. If any other matters are properly presented at the 2023 Annual Meeting, the persons named as proxies in the enclosed proxy card intend to vote or otherwise act in accordance with their judgment on the matter. IS A LIST OF STOCKHOLDERS AVAILABLE? A list of these stockholders will be open for examination electronically by any stockholder for any purpose germane to the Annual Meeting for a period of 10 days prior to the 2023 Annual Meeting by contacting our Investor Relations department at 203-682-4810 and during the Annual Meeting at www.virtualshareholdermeeting.com/GO2023. WHERE CAN I FIND THE VOTING RESULTS? We intend to announce preliminary voting results at the 2023 Annual Meeting and final voting results in a Current Report on Form 8-K filed with the SEC within four business days following the 2023 Annual Meeting. WHO IS SOLICITING PROXIES, HOW ARE THEY BEING SOLICITED, AND WHO PAYS THE COST? The solicitation of proxies is being made on behalf of our Board and we will bear the costs of the solicitation. This solicitation is being made by mail and through the Internet, but also may be made by telephone or in person. We will reimburse brokerage firms and other custodians, nominees and fiduciaries for their reasonable out-of-pocket expenses for sending proxy materials to stockholders and obtaining their votes. No additional compensation will be paid to our directors, officers or other employees for such services. Delinquent Section 16(a) Reports Section 16(a) of the Exchange Act requires the Company’s officers and directors and persons who own more than 10% of a registered class of the Company’s equity securities to file reports of ownership and changes in ownership with the SEC. Based solely on a review of copies of reports filed with the SEC and of written representations by officers and directors, the Company believes that during Fiscal Year 2022, all officers and directors subject to the reporting requirements of Section 16(a) filed the required reports on a timely basis, except that, due to administrative errors, each of Messrs. Herman and Matthews filed one late Form 4 with respect to one transaction. TABLE OF CONTENTS
| Page | | | 91 | | | Our board of directors does not presently intend to bring any other business before the meeting, and, so far as is known to our board of directors, no matters are to be brought before the meeting except as specified in the Notice of Annual Meeting. As to any business that may properly come before the meeting, however, it is intended that proxies, in the form enclosed, will be voted in respect thereof in accordance with the judgment of the persons voting such proxies.
ANNUAL REPORT TO STOCKHOLDERSOur 2020 Annual Report has been posted, and is available without charge, on our corporate website at https://investors.groceryoutlet.com/financial-information/sec-filings in the Company / Investor Relations / Financial Information section. For stockholders receiving a Notice of Internet Availability, such Notice will contain instructions on how to request a printed copy of our 2020 Annual Report. For stockholders receiving a printed copy of thisGrocery Outlet 2023 Proxy Statement a copy of our 2020 Annual Report has also been provided to you (including the financial statements and the financial statement schedules but excluding the exhibits thereto). In addition, we will provide, without charge, a copy of our 2020
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OTHER MATTERS Our Board does not presently intend to bring any other business before the meeting, and, so far as is known to our Board, no matters are to be brought before the meeting except as specified in the Notice of Annual Meeting. As to any business that may properly come before the meeting, however, it is intended that proxies, in the form enclosed, will be voted in respect thereof in accordance with the judgment of the persons voting such proxies. Availability of Fiscal Year 2022 Annual Report to Stockholders Our 2022 Annual Report has been posted, and is available without charge, at www.proxyvote.com. For stockholders receiving a Notice of Internet Availability, such Notice will contain instructions on how to request a printed copy of our 2022 Annual Report. For stockholders receiving a printed copy of this Proxy Statement, a copy of our 2022 Annual Report has also been provided to you (including the financial statements and the financial statement schedules but excluding the exhibits thereto). In addition, we will provide, without charge, a copy of our 2022 Annual Report (including the financial statements and the financial statement schedules but excluding the exhibits thereto) to any stockholder of record or beneficial owner of our common stock. Requests can be made by writing to Corporate Secretary, c/o Grocery Outlet Holding Corp., 5650 Hollis Street, Emeryville, CA 94608. Stockholder Proposals and Director Nominations for the 2024 Annual Meeting of Stockholders Stockholders wishing to include a proposal for stockholder consideration in our 2024 proxy statement or bring business before our annual meeting of stockholders in 2024 must send notice to our Corporate Secretary at our principal executive offices at 5650 Hollis Street, Emeryville, CA 94608 by registered, certified, or express mail and provide the required information and follow the other procedural requirements described below. STOCKHOLDER PROPOSALS AND DIRECTOR NOMINATIONS FOR THE 2024 ANNUAL MEETING OF STOCKHOLDERS Stockholders who wish to present a proposal in accordance with SEC Rule 14a-8 for inclusion in our proxy materials to be distributed in connection with our 2024 annual meeting of stockholders must submit their proposals in accordance with that rule so that they are received by our Corporate Secretary at the address set forth above no later than the close of business on December 30, 2023. If the date of our 2024 annual meeting is more than 30 days before or after June 20, 2024, then the deadline to timely receive such material will be a reasonable time before we begin to print and send our proxy materials. Failure to deliver a proposal in accordance with this procedure may result in it not being deemed timely received. As the rules of the SEC make clear, simply submitting a timely proposal does not guarantee that it will be included in our proxy materials. Our bylaws provide procedures by which a stockholder may bring business before any meeting of stockholders or nominate individuals for election to our Board at an annual meeting of stockholders. If a stockholder wishes to bring business to a meeting for consideration other than a matter brought pursuant to SEC Rule 14a-8 or to nominate one or more persons for election to our Board, the stockholder must deliver a written notice to our Corporate Secretary at the address written above and provide the information required by the provisions of our bylaws dealing with stockholder proposals or director nominations. In addition, stockholders who intend to solicit proxies in support of director nominees other than the Company’s nominees must also comply with the additional requirements of Rule 14a-19(b) of the Exchange Act, to the extent applicable. The notice of such a proposal or director nomination must be delivered to (or mailed to and received at) the address set forth above no later than March 22, 2024 and no earlier than February 21, 2024, unless our 2024 annual meeting of stockholders is to be held more than 30 days before, or more than 70 days after, June 20, 2024, in which case the stockholder’s notice must be delivered not earlier than the close of business on the 120th day prior to the 2024 annual meeting and not later than the close of business on the later of the 90th day prior to the 2024 annual meeting or the 10th day after public announcement of the date of the 2024 annual meeting is first made by the Company. Public announcement of an adjournment or postponement of an annual meeting will not commence a new time period for the giving of stockholder notice. If the number of directors to be elected to the Board at an annual meeting is increased and there is no public announcement by the Company naming all of the nominees for director or specifying the size of the increased Board by March 12, 2024, then a stockholder’s notice will be considered timely, but only with respect to nominees for any new positions created by such increase, if it is received by the | Page | | | 92 | | | Grocery Outlet Holding Corp., 5650 Hollis Street, Emeryville, CA 94608. INCORPORATION BY REFERENCENo information contained on or available through any website referenced in this 2023 Proxy Statement our corporate website or any other website that we may maintain shall be deemed included or incorporated by reference into
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Corporate Secretary not later than the close of business on the tenth calendar day following the day on which such public announcement is first made by the Company. The requirements for such stockholder’s notice are set forth in our bylaws, which are posted in the Corporate Governance section of the Investor Relations page on our website at https://investors.groceryoutlet.com. Candidates proposed by stockholders in accordance with the procedures set forth in the Company’s bylaws will be considered by the Nominating and Corporate Governance Committee under criteria similar to the evaluation of other candidates set forth above in “—Director Recruitment, Nomination and Appointment Process.” Candidates submitted this way may include an analysis of the candidate from our management. Any stockholder making a nomination in accordance with the foregoing process will be notified of the Nominating and Corporate Governance Committee’s decision. Certain stockholders have director nomination rights pursuant to our Amended and Restated Stockholders Agreement. See “—Nomination Rights and Support Obligations under our Amended and Restated Stockholders Agreement” above for more information. Delivery of Documents to Stockholders Sharing an Address We have adopted a procedure, approved by the SEC, called “householding.” Under this procedure, stockholders of record who have the same address and last name and did not receive a Notice of Internet Availability or otherwise receive their proxy materials electronically will receive only one copy of this Proxy Statement and the 2022 Annual Report, unless we are notified that one or more of these stockholders wishes to continue receiving individual copies. This procedure will reduce our printing costs and postage fees. If you are eligible for householding, but you and other stockholders of record with whom you share an address currently receive multiple copies of this Proxy Statement and the 2022 Annual Report, or if you hold our stock in more than one account, and in either case you wish to receive only a single copy of each of these documents for your household, please contact our Corporate Secretary by mail, c/o Grocery Outlet Holding Corp., 5650 Hollis Street, Emeryville, CA 94608 or by phone at (510) 346-5166. If you participate in householding and wish to receive a separate copy of this Proxy Statement and the 2022 Annual Report, or if you do not wish to continue to participate in householding and prefer to receive separate copies of these documents in the future, please contact our Corporate Secretary as indicated above and such separate copies will be delivered promptly. If your shares are held in street name through a broker, bank or other intermediary, please contact your broker, bank or intermediary directly if you have questions, require additional copies of this Proxy Statement or the 2022 Annual Report or wish to receive a single copy of such materials in the future for all beneficial owners of shares of our common stock sharing an address. Transfer Agent Information American Stock Transfer & Trust Company, LLC., or AST, is the transfer agent for our common stock. AST can be reached at American Stock Transfer & Trust Company, LLC 6201 15th Ave, Brooklyn, NY 11219, Attention: Shareholder Services, (800) 937-5449 or (718) 921-8124. You should contact AST if you are a registered stockholder and have a question about your account or if you would like to report a change in your name or address. Forward-Looking Statements Certain statements contained in this Proxy Statement constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. All statements contained in this Proxy Statement and the documents incorporated by reference herein other than statements of historical fact, including statements regarding the Company’s future operating results and financial position, its business strategy and plans, industry and market trends, macroeconomic conditions, compensation programs, performance goals and payouts, and the Company’s programs, plans and commitments regarding human capital management and sustainability/ESG initiatives, may constitute forward-looking statements. Words such as “anticipate,” “believe,” “estimate,” “expect,” “intend,” “may,” “outlook,” “plan,” “project,” “seek,” “will,” and similar expressions, are intended to identify such forward-looking statements. These forward-looking statements are subject to a number of risks, uncertainties and assumptions that may cause actual results to differ materially from those expressed or | Page | | | 93 | | | Grocery Outlet 2023 Proxy Statement.Statement | | | DELIVERY OF DOCUMENTS TO STOCKHOLDERS SHARING AN ADDRESS![[MISSING IMAGE: lg_groceryoutlet-pn.jpg]](/files/DEF 14A/0001104659-23-053007/lg_groceryoutlet-pn.jpg) We have adopted a procedure, approved by the SEC, called “householding.” Under this procedure, stockholders of record who have the same address and last name and did not receive a Notice of Internet Availability or otherwise receive their proxy materials electronically will receive only one copy
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implied by any forward-looking statements we make, including those described under the headings “Risk Factors,” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our 2022 Annual Report or as described in other subsequent reports we file with the SEC. Moreover, we operate in a very competitive and rapidly changing environment. New risks emerge from time to time. It is not possible for our management to predict all risks, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements we may make. You should not rely upon forward-looking statements as predictions of future events. The events and circumstances reflected in the forward-looking statements may not be achieved or occur. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activities, performance or achievements. These forward-looking statements are made as of the date of this Proxy Statement or as of the date specified herein and we have based these forward-looking statements on our current expectations and projections about future events and trends. Except as required by law, we do not undertake any duty to update any of these forward-looking statements after the date of this Proxy Statement or to conform these statements to actual results or revised expectations. | Page | | | 94 | | | Grocery Outlet 2023 Proxy Statement and the 2020 Annual Report, unless we are notified that one or more of these stockholders wishes to continue receiving individual copies. This procedure will reduce our printing costs and postage fees. | | | If you are eligible for householding, but you and other stockholders of record with whom you share an address currently receive multiple copies of this Proxy Statement and the 2020 Annual Report, or if you hold our stock in more than one account, and in either case you wish to receive only a single copy of each of these documents for your household, please contact our Corporate Secretary by mail, c/o Grocery Outlet Holding Corp., 5650 Hollis Street, Emeryville, CA 94608 or by phone at (510) 704-2859. If you participate in householding and wish to receive a separate copy of this Proxy Statement and the 2020 Annual Report, or if you do not wish to continue to participate in householding and prefer to receive separate copies of these documents in the future, please contact our Corporate Secretary as indicated above.![[MISSING IMAGE: lg_groceryoutlet-pn.jpg]](/files/DEF 14A/0001104659-23-053007/lg_groceryoutlet-pn.jpg) If your shares are held in street name through a broker, bank or other intermediary, please contact your broker, bank or intermediary directly if you have questions, require additional copies of this Proxy Statement or the 2020 Annual Report or wish to receive a single copy of such materials in the future for all beneficial owners of shares of the Company’s common stock sharing an address.
TRANSFER AGENT INFORMATIONAmerican Stock Transfer & Trust Company, LLC., or AST, is the transfer agent for our common stock. AST can be reached at American Stock Transfer & Trust Company, LLC 6201 15th Ave, New York NY 11219, Attention: Shareholder Services, (800) 937-5449. You should contact AST if you are a registered stockholder and have a question about your account or if you would like to report a change in your name or address.
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![[MISSING IMAGE: px_01page-bw.jpg]](/files/DEF 14A/0001104659-23-053007/px_01page-bw.jpg) GROCERY OUTLET HOLDING CORP. 5650 HOLLIS STREETEMERYVILLE, CA 94608 SCAN TO VIEW MATERIALS & VOTEVOTE BY INTERNETBefore The Meeting - Go to www.proxyvote.com or scan the QR Barcode aboveUse the Internet to transmit your voting instructions and for electronic delivery of information up until 11:59 p.m. Eastern Time the day before the meeting date. Have your proxy card in hand when you access the web site and follow the instructions to obtain your records and to create an electronic voting instruction form.During The Meeting - Go to www.virtualshareholdermeeting.com/GO2023You may attend the meeting via the Internet and vote during the meeting. Have the information that is printed in the box marked by the arrow available and follow the instructions.VOTE BY PHONE - 1-800-690-6903Use any touch-tone telephone to transmit your voting instructions up until 11:59 p.m. Eastern Time the day before the meeting date. Have your proxy card in hand when you call and then follow the instructions.VOTE BY MAILMark, sign and date your proxy card and return it in the postage-paid envelope we have provided or return it to Vote Processing, c/o Broadridge, 51 Mercedes Way, Edgewood, NY 11717. TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS:V14418-P91625KEEP THIS PORTION FOR YOUR RECORDSTHIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED.DETACH AND RETURN THIS PORTION ONLYGROCERY OUTLET HOLDING CORP.The Board of Directors recommends you vote FOR thefollowing:1. Election of Class I Directors.Nominees:For Against Abstain 1a.Kenneth W. Alterman1b.John E. Bachman1c.Thomas F. Herman1d.Erik D. Ragatz The Board of Directors recommends you vote FOR proposals 2 and 3:2.To ratify the appointment of Deloitte & Touche LLP as the Company’s independent registered public accounting firm for the current fiscal year ending December 30, 2023. 3.To hold an advisory (non-binding) vote to approve the Company’s named executive officer compensation. NOTE: In their discretion, the proxies, and each of them acting alone, are authorized to vote on such other business as may properly come before the Annual Meeting or any adjournments or postponements thereof. For Against Abstain Please sign exactly as your name(s) appear(s) hereon. When signing as attorney, executor, administrator, or other fiduciary, please give full title as such. Joint owners should each sign personally. All holders must sign. If a corporation or partnership, please sign in full corporate or partnership name by authorized officer.Signature [PLEASE SIGN WITHIN BOX]DateSignature (Joint Owners)Date
![[MISSING IMAGE: px_02page-bw.jpg]](/files/DEF 14A/0001104659-23-053007/px_02page-bw.jpg) Important Notice Regarding the Availability of Proxy Materials for the Annual Meeting:The Notice and Proxy Statement and Annual Report are available at www.proxyvote.com.V14419-P91625GROCERY OUTLET HOLDING CORP.Annual Meeting of StockholdersJune 20, 2023 11:00 AM Pacific Daylight TimeTHIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORSThe undersigned hereby appoints Robert J. Sheedy, Jr. and Charles C. Bracher, or either of them, as proxies, each with the power to appoint his substitute, and hereby authorizes them to represent and to vote, as designated on the reverse side, all of the shares of Common Stock of Grocery Outlet Holding Corp. ("Grocery Outlet") that the undersigned would be entitled to vote at the Annual Meeting of Stockholders of Grocery Outlet to be held on June 20, 2023 at 11:00 AM Pacific Daylight Time at www.virtualshareholdermeeting.com/GO2023 and any adjournment or postponement thereof (the "Annual Meeting"). The undersigned revokes any proxy previously given to vote at such meeting.This proxy, when properly executed, will be voted in the manner directed herein. If no such direction is made, this proxy will be voted in accordance with the Board of Directors' recommendations.In their discretion, the proxies are authorized to vote upon such other business as may properly come before the Annual Meeting or any adjournment or postponement thereof. Continued and to be signed on reverse side
0001771515 3 2022-01-02 2022-12-31 |
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