Company: RRGB
Filing Date: 2025-03-18
Form Type: PRE 14A
Source: 0001104659-25-025001
Chunk: 33

Company: RED ROBIN GOURMET BURGERS INC
Filing Date: 2025-03-18
Form: PRE 14A
Chunk 33
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Deductibility of Executive Compensation The Compensation Committee considers the tax impacts of material elements of our executive compensation program. These factors alone do not drive our compensation decisions, but rather they are considered along with other factors such as the cash and non-cash impact of the program, and whether the program is consistent with our compensation objectives. Historically, the Compensation Committee had generally structured our executive compensation in a manner designed to qualify for deductibility under the performance-based compensation exception from the limitation otherwise applicable under Section 162(m) of the Internal Revenue Code. The performance-based compensation exception has been repealed, effective for taxable years beginning after December 31, 2017, such that compensation paid to our named executive officers in excess of $1 million is generally not deductible. Due to ambiguities and uncertainties in the application and interpretation of Section 162(m) and the regulations issued thereunder, including the uncertain scope of potential transition relief under the legislation repealing Section 162(m)’s exemption from the deduction limit, no assurance can be given that compensation intended to satisfy the requirements for exemption from Section 162(m) in fact will. Further, while we consider deductibility as one factor in determining executive compensation, in some cases we may decide it is either not possible or desirable to satisfy all of the conditions of Section 162(m) for deductibility and still meet our compensation needs. Accordingly, we may pay compensation that is not deductible under Section 162(m) from time to time.

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TABLE OF CONTENTS GOVERNANCE OF EXECUTIVE COMPENSATION ✓ Pay for performance-focused executive compensation structure, with a significant portion of pay “at-risk” ✓ Independent Compensation Committee approves executive compensation structure and performance goals ✓ Independent compensation consultant advises the Compensation Committee ✓ Payouts under our annual and long-term incentive compensation plans are capped ✓ Long-term incentives feature multiple components; performance is measured over multi-year periods with value dependent on share price as compared to a group of key competitors; payouts are capped if TSR is negative ✓ Double trigger required for cash severance and equity vesting upon change in control (other than certain performance awards) ✓ Meaningful stock ownership guidelines for executives and Board members ✓ Formal policy prohibiting hedging and pledging of Company securities by executive officers and directors ✓ Clawback policy for the return of incentive-based compensation in the event of a financial restatement ✓ Limited perquisites ✓ No incentivizing of short-term results to the detriment of long-term goals