Donald Berchtold

About Donald J. Berchtold

Donald J. Berchtold (age 80) has served as a director of FAT Brands since March 2023 and is a long‑tenured operating executive currently serving as Chief Concept Officer (role since February 2018). He holds a B.S. in Finance and Marketing from Santa Clara University and brings 50+ years of restaurant/hospitality experience, including prior leadership roles at Fatburger North America, Fog Cutter Capital Group, and Wilshire Financial Services/Wilshire Credit .

Past Roles

External Roles

Board Governance

• Independence: Not independent under NASDAQ standards (serves as an employee director) .
• Committee assignments: Not listed on Audit Committee or Compensation Committee; Audit members are Collier (Chair), Child, Elenowitz, Ellis, Feinstein, Green; Compensation members include Collier, Child, Elenowitz, Ellis, Feinstein, Green, Metz, and Andrew Wiederhorn (Chair) .
• Attendance: Each incumbent director attended at least 75% of Board and applicable committee meetings in fiscal 2024; Board held 25 meetings; Audit Committee held six .
• Board structure: FAT is a “controlled company” (majority voting power held by Fog Cutter Holdings LLC); not required to have a majority independent board nor an independent nominating function; Mark Elenowitz serves as Lead Independent Director .
• Governance reforms (Delaware settlement commitments): Establish Related Party Transactions Committee of independent directors; Audit Committee charter enhancements; rotation of Audit Chair; independent director education; independent‑only sessions at least four times per year; oversight of Wiederhorn consulting fees; hiring independent Delaware corporate counsel for related‑party matters .

Fixed Compensation

Notes:

• As an employee director, compensation is disclosed under “Certain Relationships and Related Transactions”; non‑employee director retainer ($120,000 cash + annual options) applies to independent/non‑employee directors, not employee directors like Berchtold .

Performance Compensation

• Performance metrics tied to Mr. Berchtold’s compensation were not disclosed; for executives, the Company generally references “personal and Company‑wide targets” for eligibility, but no specific metrics are provided for Mr. Berchtold .

Other Directorships & Interlocks

Expertise & Qualifications

• 50+ years in restaurant/hospitality; former owner‑operator (dinner house, catering, food service concepts); active member in Restaurants of Oregon Association .
• Strategic planning, leadership of complex organizations, and industry operations experience .
• Education: B.S. Finance and Marketing, Santa Clara University .

Equity Ownership

• Anti‑hedging/margining: Insider Trading Policy discourages hedging and prohibits short‑sales/margining of Company stock; pledging not specifically addressed and no pledging for Berchtold is disclosed .

Insider Trades

Governance Assessment

• Alignment: Meaningful ownership across both Class A and super‑voting Class B shares (1.6% total voting power) plus options indicates skin‑in‑the‑game, but Class B amplifies voting influence that may not correlate with economic stake (governance complexity in a controlled structure) .
• Independence/Committees: As a non‑independent employee director with deep family interlocks, Berchtold is not positioned on key independent oversight committees (Audit/Compensation), which concentrates oversight among independent members but leaves potential perceptions of influence via board dynamics in a controlled company .
• Attendance/Engagement: Board meeting cadence is high (bi‑weekly, 25 meetings in FY 2024), and incumbents met the ≥75% attendance threshold, supporting engagement .
• Compensation structure: Fixed salary as an employee director ($275,000 annually) and limited disclosed variable pay (one bonus in FY 2023) suggest low at‑risk compensation linkage for Berchtold; lack of disclosed performance metrics for his pay reduces pay‑for‑performance transparency .
• Governance reforms: The Delaware derivative settlement commitments strengthen related‑party oversight and independent processes (e.g., independent‑only sessions, Related Party Transactions Committee, Audit Charter enhancements), which partially mitigates controlled‑company risks .

RED FLAGS

• Controlled company with extensive family ties across Board and management (father/grandfather/sons/grandsons interlocks), elevating conflict‑of‑interest risk and potential minority shareholder disenfranchisement .
• Derivative litigation naming Berchtold among numerous current/former directors/officers; Company obligated to indemnify defense costs, potentially straining financial resources and management attention; outcome uncertain .
• Consulting arrangement and high fees paid to Andrew Wiederhorn while serving as director/consultant prior to CEO re‑appointment highlight related‑party and pay optics (though governance reforms target this area); signals heightened scrutiny on compensation oversight and related‑party transactions .

Potential Investor Implications

• Board effectiveness hinges on the robustness of independent committee oversight (Audit/Comp) and the execution of settlement‑driven governance reforms; monitoring the functioning of the new Related Party Transactions Committee is critical .
• Ownership/voting structure (Class B) plus familial interlocks can entrench control; investors should weigh governance discount risk versus operational experience and engagement levels .
• Litigation overhang introduces headline and indemnification risk; track legal developments and insurer coverage sufficiency .