Michael Diamond

About Michael Diamond

Michael F. Diamond, age 42, was appointed Executive Vice President and Chief Financial Officer of Driven Brands effective August 9, 2024, after joining the company on July 29, 2024; he holds a BBA from Notre Dame and an MBA from Harvard Business School . In fiscal 2024, under the company’s broader leadership transition period, Driven delivered revenue growth of +2% year over year, same-store sales growth of +1% and Adjusted EBITDA +7% (non-GAAP) . Since the January 15, 2021 baseline used in the Pay-Versus-Performance table, Driven’s cumulative TSR measured to year-end 2024 equated to a value of $61 on a $100 initial investment, reflecting a challenging equity backdrop for incentive alignment design .

Past Roles

Fixed Compensation

Performance Compensation

2024 Annual Bonus Plan (ABP) – Metrics, Weighting, and Payout Scales

• Diamond’s 2024 ABP payout: fixed at 50% of target (=$350,000) per his letter agreement (inducement structure) .

2024 Long-Term Incentives (granted on hire)

• Program design: 33% RSUs / 67% PSUs; PSUs split 60% Cumulative Adjusted EBITDA and 40% Relative TSR; EBITDA thresholds 90%/100%/110% for 50%/100%/200% payouts; TSR at 25th/50th/75th percentiles for 50%/100%/200% payouts; cliff vesting post-certification .

Equity Ownership & Alignment

Notes:

• No stock options are reported for Diamond in the outstanding awards table (equity mix is RSUs/PSUs) .
• Equity award timing governed by standard committee cadence; no spring-loading/timing to MNPI in 2024 disclosed .

Non-Qualified Deferred Compensation (NQDC) – 2024

Employment Terms

• Start and appointment dates: Joined July 29, 2024; appointed CFO effective August 9, 2024 .
• Base/bonus/LTI eligibility (from Offer Letter): Base salary $700,000; target annual bonus 100% of salary; annual equity from 2025 at 250% of total cash compensation; one-time cash bonus $200,000; one-time $3.5 million equity (50% RSUs, 50% PSUs) with RSUs vesting over 3 years and PSUs based on TSR and Adjusted EBITDA for 2024–2026 .
• Severance: If terminated without cause or he resigns for good reason, base salary continuation for 12 months; if resignation for good reason, also entitled to any earned but unpaid prior-year bonus, subject to release and covenant compliance .
• Good Reason (illustrative element): includes relocation of primary work location more than 50 miles from Dallas, TX, among other adverse changes, subject to notice/cure .
• Change-in-control: No standalone CIC cash multiple disclosed; severance is payable only on termination without cause or for good reason; proxy’s quantified table indicates $700,000 cash severance upon termination without cause or for good reason in connection with a change in control (double trigger) .
• Treatment of awards: Unvested RSUs and PSUs generally forfeit upon termination; PSUs forfeit if termination before end of performance period/certification; certain “Distributed Shares” and “Top-Up Options” (pre-IPO constructs not applicable to Diamond) accelerate on a “sale transaction” .
• Clawback: Nasdaq Rule 5608/SEC Rule 10D‑1-compliant policy to recoup excess incentive-based pay on restatement; award agreements allow cancellation for misconduct or restrictive covenant violations .

Compensation Structure Analysis (signals)

• Cash vs equity mix: For 2024, Diamond’s compensation was heavily equity-weighted via $3.64 million grant-date stock awards versus cash salary/bonus due to mid-year hire and sign-on structure, aligning with a pay-at-risk philosophy .
• Metric design and adjustments: 2024 ABP re-weighted toward Adjusted EBITDA (75%) and removed net unit growth; mid-year calibration lowered performance targets to align with industry conditions but raised EBITDA threshold to 97% and capped payouts at target—mitigating windfall risk while acknowledging macro headwinds .
• No option repricing and no excise tax gross-ups: Company prohibits repricing and excise tax gross-ups as part of “best practices,” supporting shareholder-friendly design .

Compensation Peer Group (for benchmarking)

• Positioning: Company judged peer set appropriate with DRVN between 25th–50th percentiles on revenue and closer to 50th on system-wide sales .
• Say-on-pay: 78% approval at 2024 annual meeting; investor feedback tied to one-time 2023 modification of pre-IPO awards inflating SCT figures; no major program changes made thereafter .

Performance Compensation – Detail Table (ABP Outcomes for 2024)

Equity Awards Outstanding (12/28/2024) – Michael Diamond

Equity Ownership Snapshot (as of 4/7/2025)

Governance & Policies Relevant to Alignment

• Stock ownership guidelines: 3x salary for NEOs; Diamond compliance deadline August 2029 .
• Hedging/pledging: Prohibited (including short sales, options, swaps, margin, pledging) .
• Compensation risk: Committee concluded programs do not encourage excessive risk-taking .
• Committee/consultant: Independent Compensation Committee retains Meridian as advisor .

Investment Implications

• Alignment and retention: Diamond’s initial package leans toward multi-year equity (RSUs/PSUs) with RSUs vesting annually through 2027 and PSUs tied to 2024–2026 cumulative EBITDA and relative TSR, promoting retention and long-term value creation levers .
• Limited CIC/severance economics: Cash severance equals 12 months’ base salary (including in CIC double-trigger) without equity acceleration for RSUs/PSUs—curbing windfalls and limiting take-private arbitrage incentives .
• Ownership build underway: As of April 2025, Diamond shows no reportable beneficial ownership while holding sizable unvested RSUs/PSUs; he must reach 3x salary ownership by August 2029, suggesting increasing “skin-in-the-game” over time as vesting and accumulation occur .
• Pay-for-performance posture: 2024 bonus mechanics emphasized EBITDA and capped payouts; long-term plan relies on multi-year EBITDA and relative TSR, which is prudent given DRVN’s mixed historical TSR since IPO and the need for operational outperformance to realize PSU value .