Michael Cowan

About Michael B. Cowan

Michael B. Cowan (age 60) is a Class I independent director of GEN Restaurant Group, Inc. since the company’s Nasdaq listing in 2023; he currently serves as Lead Independent Director. He is President & CEO of H-1 Auto Care, LLC (Honest1 Auto Care) since 2018, Managing Member of SLC Capital Partners, LLC since 2010, and previously held multiple roles including CFO at J.H. Whitney & Co.; he began his career at Purina Mills and holds a B.S. in Finance from La Salle University .

Past Roles

External Roles

Board Governance

• Independence: The Board determined all directors are independent except CEO David Kim and former Co-CEO/director Jae Chang; Cowan is independent .
• Lead Independent Director: Independent directors designated Cowan; responsibilities include presiding over meetings without the chair, approving Board materials, agendas and schedules, liaison with the chair, and investor consultations on request .
• Committee memberships and expertise:
  • Audit Committee member; Board determined Cowan is an “audit committee financial expert” and independent under SEC Rule 10A-3 and Nasdaq listing standards .
  • Compensation & Human Capital Committee chair; meets heightened independence standards .
• Attendance: In 2024, all directors attended all Board and applicable committee meetings and the annual meeting (implies 100% attendance for Cowan) .
• Meeting cadence (2024): Board (4), Audit (4), Compensation & Human Capital (1), Nominating & Governance (1) .
• Governance architecture considerations:
  • GENK is a “controlled company” under Nasdaq; the Nominating & Governance Committee includes CEO David Kim (chair) and director Jae Chang, and is not required to be fully independent .
  • The Board chair (David Kim) serves as a de facto non-paid member of all three committees, which may affect perceived committee independence (though formal committee membership remains independent where required) .
• Insider trading policy: Prohibits hedging and short sales; requires pre-clearance for directors/officers .
• Clawback policy: Executive compensation recoupment policy for restatements or misconduct; applies to executives, not specifically to directors .
• Family relationships: None among directors or executive officers .

Fixed Compensation

Notes:

• GENK has no formal non-employee director compensation plan yet; Board is considering a policy .
• Under the 2023 Plan, aggregate annual non-employee director compensation is capped at $150,000, increased to $200,000 in the year a director first joins the Board or serves as chairman or lead director (Cowan qualifies as lead director) .
• No additional compensation for meetings, travel, projects; none approved in 2024 .

Performance Compensation

Other Directorships & Interlocks

Expertise & Qualifications

• Audit committee financial expert designation under SEC rules .
• Senior finance and PE background (CFO roles at J.H. Whitney; >$5B AUM) .
• Operating CEO experience in multi-unit franchising (Honest1 Auto Care) .
• B.S. in Finance, La Salle University .

Equity Ownership

Additional alignment elements:

• 2024 director equity grant: 6,000 RSUs vesting over one year (time-based) .
• Hedging/short sales prohibited for directors .
• Ownership guidelines: Not disclosed for directors .

Governance Assessment

• Strengths:
  • Lead Independent Director role centralizes independent oversight; responsibilities include agenda/material review and investor liaison .
  • Audit and Compensation committees chaired/manned by independent directors; Cowan designated audit financial expert .
  • 100% attendance by directors in 2024; signals engagement .
  • Director pay mix for Cowan is entirely equity ($50,000 RSUs, 6,000 shares), enhancing alignment with shareholders; no cash retainer or meeting fees .
  • Hedging/short sale prohibitions and executive clawback policy strengthen governance posture .
• Watch items / RED FLAGS:
  • Controlled company status with CEO David Kim chairing Nominating & Governance and serving as de facto non-paid member of all committees may dilute perceived independence of nomination and oversight processes .
  • Related-party transactions primarily involve insiders (Kim/Chang) and affiliates (Ignite, PGD, Wise); although none involve Cowan, the overall related-party profile elevates governance risk at the company level .
• Net view: Cowan’s independence, committee leadership (Compensation chair) and audit financial expertise, combined with strong attendance and equity-heavy director compensation, support board effectiveness and investor confidence. Company-level controlled company dynamics and related-party dealings should remain on the monitoring list, though no Cowan-specific conflicts are disclosed .

Related Party Transactions (context)

• Ignite Consulting (100% owned by David Kim) terminated at IPO; $2.3M expensed/paid in 2023; $0 in 2024 .
• Pacific Global Distribution (100% owned by Jae Chang/family): $678K supplies purchased in 2024; $2.8M in 2023 .
• Wise Universal (60% owned by Jae Chang): $12.4M food purchases in 2023; none in 2024 .
• Administrative services to <10 restaurants owned by David Kim (unrelated to GENK) .
• No related-party transactions disclosed involving Michael Cowan .

Insider Trades

Compensation Structure Considerations

• Non-employee director annual cap: $150,000; raised to $200,000 for year serving as chairman or lead director (applies to Cowan), providing flexibility but requiring monitoring for pay inflation .
• 2024 director compensation for Cowan: $50,000 equity; no cash, meeting or chair fees; no performance-linked metrics .
• Equity grants are time-based RSUs; no repricing/modification language affecting directors disclosed; option repricing prohibited without shareholder approval (under plan) .

Attendance & Executive Sessions

Compensation Committee Analysis

• Members: Michael B. Cowan (Chair), Jonathan Gregory; both meet heightened independence standards under SEC and Nasdaq .
• Responsibilities: Approves compensation and benefits for employees, officers, and independent directors; administers equity plans; recommends equity awards .
• Consultant use: Not disclosed; committee charter references authority to retain advisors (Board charters available) .

Controlled Company & TRA Structure (context)

• GENK’s “controlled company” status affects committee independence expectations, specifically Nominating & Governance .
• Tax Receivable Agreement (TRA) provides substantial payments to GEN LLC members (including Kim/Chang/family) tied to exchanges, potentially impacting liquidity; no Cowan involvement disclosed –.

Equity Compensation Plan Snapshot

Board Governance Summary

• Structure: Classified board with three classes; removal only for cause by 66 2/3% vote—enhances continuity but reduces shareholder influence on board composition .
• Election: Plurality standard; irrevocable resignation policy upon failure to receive required vote .

RED FLAGS Summary

• Controlled company governance and executive presence (Kim) on nominating/governance and as de facto non-paid committee member .
• Significant related-party transactions involving management/founders (not Cowan) .

Conclusion

Cowan’s profile—independent status, lead independent role, audit financial expertise, chairing the compensation committee, strong attendance, and equity-only director pay—supports board effectiveness and shareholder alignment. Company-level governance risks inherent to the controlled structure and related-party transactions should be monitored, though no Cowan-specific conflicts or attendance issues are disclosed .