Robert Lynch

About Robert Lynch

Robert “Rob” Lynch (age 48) has served as Shake Shack’s Chief Executive Officer and as a Class II director since May 20, 2024; he holds a BA and an MBA from the University of Rochester and previously led Papa John’s as CEO, and senior roles at Arby’s, Taco Bell, Heinz, and Procter & Gamble . Under Lynch, SHAK reported Q3‑2025 total revenue up 15.9% year over year, same‑Shack sales up 4.9%, and Adjusted EBITDA up 18.2%, with a swing to positive net income versus a loss in 2024; he signed the SOX 302/906 certifications as CEO for the Q3‑2025 10‑Q . His incentive design is heavily at‑risk with multi‑year PSUs tied to Adjusted EBITDA, Same‑Shack Sales, Restaurant‑level profit margin, and sign‑on PSUs that are 50% TSR‑based at an above‑median (55th percentile) target .

Past Roles

External Roles

Fixed Compensation

Performance Compensation

2024 Short‑Term Cash Incentive (STI) – CEO Design

Notes: 2024 CEO STI metrics were annual Adjusted EBITDA (50%), annual Same‑Shack Sales (25%), and annual Restaurant‑level Profit Margin (25%), measured pro‑rata from his start date . The company also disclosed semi‑annual revenue/EBITDA targets for other NEOs; CEO payout factor was 112.3% .

Long‑Term Incentives (LTI) – Grants in 2024

Additional program design notes:

• Company‑wide governance shifts: 2025 LTI moves to 3‑year performance periods and 3‑year vesting for PSUs/RSUs to align with peers; metrics will be Total Revenue and Adjusted EBITDA for PSUs .
• Clawback: Dodd‑Frank policy effective Dec 1, 2023; employment agreement subjects compensation to clawback .

Equity Ownership & Alignment

Employment Terms

Board Governance (Director Service, Committees, Independence)

• Board service: Lynch is a Class II director (appointed May 20, 2024); term expires at the 2026 annual meeting .
• Independence: SHAK separates Chair and CEO (Daniel Meyer is Chair); the Board identifies eight independent directors; Lynch is not listed as independent .
• Lead Independent Director: Role established in 2021; Jeff Flug serves as Lead Director .
• Committee memberships: Audit, Compensation, and Nominating committees are fully independent; Lynch is not listed on committees .
• Meeting attendance: In FY2024, the Board met 10x; each director attended at least 75% of Board/committee meetings; independent directors hold quarterly executive sessions .

Director Compensation Context (non‑employee directors)

• Standard retainer: $62,500 cash + $62,500 in RSUs annually; committee chair and Lead Director receive additional cash/RSUs ($5k–$12.5k each); non‑employee directors may elect equity in lieu of cash; one‑year vesting; deferral available (from 2025) .
• FY2024 payments are disclosed for non‑employee directors; employee directors (e.g., CEO) are not in the non‑employee director compensation table .

Performance & Track Record

Compensation Structure Analysis

• Mix and at‑risk orientation: CEO pay is highly variable via STI tied to Adjusted EBITDA/Same‑Shack margin metrics and multi‑year PSUs; annual PSUs weight EBITDA (50%), Same‑Shack Sales (25%), and Restaurant‑level margin (25%), encouraging both growth and margin discipline .
• Shareholder alignment: Sign‑on PSUs are 50% relative TSR with an above‑median (55th percentile) target; additional operational metrics balance TSR with fundamentals .
• Retention and potential selling pressure: Near‑term vesting of sign‑on RSUs (May 2025/2026) and annual RSUs (2025–2028) creates identifiable liquidity windows; however, non‑compete (18 months), ownership guidelines (2x salary within 5 years), and anti‑hedging/pledging reduce misalignment risk .
• Change‑in‑control economics: Double‑trigger‑like structure (termination within 12 months post‑CIC) yields 24 months base salary, target bonus, pro‑rata RSUs/PSUs, and COBRA; no 280G tax gross‑ups (best‑net cutback applies) .
• Governance safeguards: Independent Compensation Committee, clawback policy, and quarterly executive sessions of independent directors mitigate pay/oversight risk while the Chair/CEO split limits dual‑role concentration .

Investment Implications

• Alignment and upside capture: The heavy weighting of PSUs to EBITDA, margin, and relative TSR should motivate sustained operating leverage and competitive shareholder returns, particularly given the three‑year performance windows and 200% PSU max opportunity .
• Retention vs liquidity: Stacked RSU/PSU vesting (2025–2028) plus 18‑month non‑compete and 2x salary ownership guideline point to manageable retention risk; watch 2025–2027 vesting dates for potential trading windows, though anti‑hedging/pledging rules constrain risk‑taking .
• Event risk discipline: Post‑CIC severance is meaningful but structured (pro‑rata equity, no gross‑ups), limiting egregious parachute optics while preserving leadership continuity in a transaction .
• Early execution reads: With Q3‑2025 revenue/EBITDA growth and margin improvement alongside positive net income, near‑term KPI trends are supportive of Lynch’s PSU scorecard, but investors should track FY2024–FY2026 cumulative targets for annual PSUs and TSR percentile outcomes on sign‑on PSUs .

Appendix: Select 2024 Summary Compensation (from DEF 14A)

Citations:

• Governance, board structure, independence, lead director, committee composition, and director compensation policy .
• CEO biography, education, external board service .
• CEO employment terms, STI/LTI design, severance/CIC, clawback, non‑compete/non‑solicit, stipend, arbitration, 280G ; see also summaries in DEF 14A .
• 2024 STI metrics/targets/actuals and CEO payout .
• 2025 LTI program evolution .
• Ownership/awards and anti‑hedge/pledge/ownership guidelines .
• Operating results context (Q3‑2025 PR and SOX certifications) .