AGM 2020

Jun 10, 2020

Good morning, and welcome to Shake Shack's 2020 Annual Meeting of Shareholders. At this time, I would like to turn the conference over to Randy Garutti, Shake Shack's Chief Executive Officer and a member of the company's Board of Directors. Please go ahead. Thanks so much and good morning everyone. We really appreciate your interest in Shake Shack and for taking the time to join us today. I want to provide just a few brief introductory remarks we begin the formal part of this meeting in order to acknowledge the unprecedented time we're living through. Today, I really just want to spend this time thanking our team. Through this deeply difficult time, our team has continued to show up to support each other, our guests, our communities and our suppliers. They've had an unwavering commitment to excellence in the face of one of the most difficult public health crises the world has ever faced and we owe them a debt of gratitude. At Shake Shack, we are more committed than ever to supporting their development and creating equitable opportunity for each and every team member. They are the future of this company. They will rebuild for the bright future ahead. I also want to be sure to acknowledge the work of that team and this company throughout last year in 2019. We celebrated outstanding growth and success across the business while capturing our largest ever class of Shacks. No one could have anticipated what lay ahead as 2020 began. Now firmly into this year, we continue to work to execute and adjust our strategic plan. These last months have seen an amplification and acceleration of the work we had already committed to long before the current challenges. We remain with 4 main focuses: putting our people first, focusing on recruiting, retention, compliance, diversity, inclusion and the all important development our leaders. There is just so much more we must do and we're committed to that change and that improvement. We're going to simplify and support our Shacks, improving our workflow, our throughput, our cost efficiency and making the deep investments in tech and operational infrastructure to further enable our teams to focus on serving our guests. We're working to win the guest experience, capitalizing on our brand power using data insights and building a next generation of guest experience in an omnichannel world and innovating new and exciting menu items that entice new guests and drive returns amongst existing fans, all within a new era of safety, spacing and the ease of use that we are working towards. Finally, we're building out and evolving the tremendous white space opportunity we now have all over the world. And what we expect to be a forever changed retail environment, many new opportunities will be available to us and we'll continue to build those community gathering places we've always been known for. But the work of our digital ops and tech teams will add a new level of convenience to Shack fans as we make it even easier and more comfortable to get your Shack. We enter this crisis in a position of strength and with strong momentum. Our balance sheet is strong and we will come out of this movement with an unmatched resolve and determination to grow again and to improve the lives of our team along the way. We believe as the world begins to carefully reopen, the human need to gather is fundamental. And indeed, it's what this company has been built upon. And you can bet that when the day comes, when friends, families, co workers, travelers and everyone in our community gathers again, Shake Shack will be a place they choose to do so. Stay safe, stay healthy, we'll get through this together. With that, I'll turn the meeting over to Ron Palmides, our General Counsel and Senior Vice President, to conduct the formal business of this meeting. Thank you, Randy. We are pleased to once again be holding our annual meeting virtually, which we believe provides our shareholders with the best opportunity to attend our annual meeting and serves best to protect the health and well-being of our stockholders, employees, directors, officers and representatives. I'm joined, as you know, by Randy Grudi, our CEO and a member of the Board of Directors Tara Camont, our President and Chief Financial Officer and Zachary Kaufman, our Chief Operating Officer. We are also joined by our director nominees, our other directors and representatives from our registered accounting firm Ernst and Young. Today's session allows our shareholders to participate in the meeting regardless of their location. Not only can you view the meeting, you can also submit questions and vote your shares online before the polls close. We have allocated time after the adjournment of the formal part of the meeting for Q and A. There is a text box on your screen where you can submit your questions anytime throughout the meeting. If we're unable to get to your questions, you may always email us at investorkshakeshack.com. Before we begin our prepared remarks, it is possible that some of this morning's comments or responses to your questions may contain forward looking statements that are based on certain assumptions and that are subject to known and unknown risks, uncertainties and other important factors that may cause actual results to be materially different. We have 3 items of business to conduct today's meeting. They are to reelect 3 of our directors, to consider and act upon a proposal to ratify the appointment of our auditors as our independent registered public accounting firm for the current fiscal year ending December 25, 2020 and to conduct an advisory vote on the compensation of Shake Shack's named executive officers. Momentarily, I will announce the opening of the polls as we call for a vote on the matters to be presented for your consideration at this meeting. After the votes are tallied and announced, we will adjourn the formal part of our meeting. The Board of Directors has appointed Peter Dziskovich of Broadridge to serve as our Inspector of Election. He is present at the meeting today. And as required by law, Mr. Dzhkovitch has taken and signed an oath as Inspector of Election. A certified list of the shareholders of record entitled to vote at today's meeting for purposes of sending the notice of meeting and proxy statement is available online, and I have an affidavit from Broadridge attesting to the delivery of the notice. Mr. Dzhskovich has advised me that a majority of the company's outstanding voting shares held of record as of the close of business on April 16, the record date for this meeting, are represented at today's meeting in person or by proxy. I declare that a quorum is present and that we may proceed with the business of the meeting. Please remember that you may vote your shares online anytime during this meeting prior to the closing of the polls. We will now proceed to the voting on the items I described. Is approximately 9:0:6 a. M. Eastern Time and the polls are now open for voting on each of the items of business. If you have previously voted by proxy and do not wish to change your vote, did not send in a proxy and wish to cast your vote now or have did not send in a proxy and wish to cast your vote now or have not already cast your vote using our electronic voting system, you may cast your vote by electronic ballot at virtualshareholdermeading.com/shack2020 at this or any time until the conclusion of the meeting. You will notice a link to the voting site on your screen. Access to virtual shareholdermeeting.com/shack2020 requires the control number you received prior to this meeting. As mentioned, the first order of business is the election of 3 directors. The following persons are nominated as our directors: Randy Grudi, Joshua Silverman and Jonathan Sokoloff. The second item is a proposal to ratify the appointment of Ernst and Young LLP as our independent registered public accounting firm for the fiscal year ending December 25, 2020. And the third item is to conduct the advisory vote on the compensation of the company's named executive officers. We will be closing the polls momentarily. We must submit your electronic ballot in order for your votes to be counted. The Inspector of Election will not accept votes submitted after the closing of the polls. Please note that any votes by electronic ballot submitted today will be subject to final verification by our Inspector of Election. There being no further ballots, I hereby declare the polls are now closed at 9:0:8 a. M. Eastern Time for voting on the items of business. All electronic ballots and proxies are now in the custody of our Inspector of Election. We have received the preliminary tabulation of votes by the Inspector of Election. All votes are subject to final count certified by the Inspector. Each of the persons nominated as a Director received majority of votes cast and is hereby elected the Director of the Company. The resolution relating to the ratification of the appointment of Ernst and Young as independent registered public accounting firm for the fiscal year ending December 25, 2020, received the majority of those cast and Ernst and Young is hereby approved as our accounting firm. And the proposal to approve on an advisory basis the compensation of the company's named officers receive the majority of votes cast and hereby pass. Based on the vote, I declare that the proposals have been approved. It's now 9:0:9 a. M. Eastern Time, and I declare the formal business of today's meeting is concluded. The company will report the final results on a Form 8 ks filed within the 4 business days of today's meeting. At this time, I'd now like to open the meeting to questions. Hi, it's Randy again and we've got some questions that I appreciate just regarding the venue, which I'll take quickly here. There was a question about whether we would offer organic fries or a fish sandwich. We're excited in our Innovation Kitchen to continue to innovate exciting new items. We have some great LTOs that we had planned for earlier in the year that we've paused. We're hoping to do those later in the year, specifically focused on chicken as well as, a great new veggie burger. We're continuing to evolve that we've been testing over the last couple of years. So we're going to continue to do that, making sure that everything we do is on par with the Shake Shack brand and fits, especially during this tough time. There was also a question about our packaging, which is something we continue to look at nonstop, mostly really geared today towards the focus of safety, making sure that our team, our guests and everyone can be safe with sealed packaging. That requires a little extra packaging these days, that comes at an extra cost, but something that we believe is right and we're going to keep working on that. So thanks for the questions. At this point, we don't have any further questions. I just want to thank everyone for attending again and for your continued support of Shake Shack. Take care all. Thanks, everybody. This concludes the meeting. You may now disconnect.