SEC Form PREM14A filed by Denny's Corporation

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

SCHEDULE 14A

Proxy Statement Pursuant to Section 14(a) of the

Securities Exchange Act of 1934

 

 

Filed by the Registrant  ☒

Filed by a Party other than the Registrant  ☐

Check the appropriate box:

 

☒	Preliminary Proxy Statement

 

☐	Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))

 

☐	Definitive Proxy Statement

 

☐	Definitive Additional Materials

 

☐	Soliciting Material Pursuant to §240.14a-12

DENNY’S CORPORATION

(Name of Registrant as Specified In Its Charter)

(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

Payment of Filing Fee (Check the appropriate box):

 

☐	No fee required.

 

☐	Fee paid previously with preliminary materials.

 

☒	Fee computed on table in exhibit required by Item 25(b) per Exchange Act Rules 14a-6(i)(1) and 0-11.

 

PRELIMINARY PROXY STATEMENT-SUBJECT TO COMPLETION

DATED NOVEMBER 18, 2025

 

203 E. Main Street

Spartanburg, South Carolina 29319

MERGER PROPOSED-YOUR VOTE IS VERY IMPORTANT

[●], 2025

Dear Fellow Stockholders:

A special meeting of stockholders of Denny’s Corporation, a Delaware corporation (the “Company,” “we” or “us”), will be held on [●], 2026 at [●], Eastern Time (the “Special Meeting”). You will not be able to attend the Special Meeting in person. The Special Meeting will be held in a virtual meeting (audio webcast) format only. Stockholders of record at the close of business on [●], 2025, the record date for the Special Meeting, will be able to attend the Special Meeting by visiting [●]. A secure control number that will allow you to participate in the meeting electronically can be found on the enclosed proxy card. For purposes of attendance at the Special Meeting, all references in this proxy statement to “present in person” or “in person” shall mean virtually present at the Special Meeting. This proxy statement is dated [●], 2025 and is first being mailed to stockholders of the Company on or about [●], 2025.

At the special meeting, you will be asked to consider and vote on three proposals:

 

•

a proposal to adopt the Agreement and Plan of Merger, dated as of November 3, 2025 (as it may be amended from time to time, the “Merger Agreement”), by and among Sparkle Topco Corp., a Delaware corporation (“Parent”), Sparkle Acquisition Corp., a Delaware corporation and wholly owned, indirect subsidiary of Parent (“Merger Sub”), and the Company, providing for, among other things, the merger of Merger Sub with and into the Company (the “Merger”), with the Company surviving the Merger as a wholly owned, indirect subsidiary of Parent (the “Merger Proposal”);

 

•

a proposal to approve, on a non-binding, advisory basis, certain compensation that may be paid or become payable to the Company’s named executive officers that is based on or otherwise relates to the Merger (the “Compensation Advisory Proposal”); and

 

•

a proposal to approve one or more adjournments of the Special Meeting to a later date or time, if necessary or appropriate, to solicit additional proxies if there are insufficient votes to adopt the Merger Agreement at the time of the Special Meeting (the “Adjournment Proposal”).

If the Merger is completed, you will be entitled to receive $6.25 in cash, without interest and less any applicable withholding tax, for each share of the Company’s common stock, par value $0.01 per share (“Common Stock”), you own (unless you have properly demanded appraisal for your shares in accordance with, and have complied in all respects with, Section 262 of the General Corporation Law of the State of Delaware and such demand is not effectively withdrawn).

After reviewing and considering the terms and conditions of the Merger and the factors more fully described in the accompanying proxy statement, our board of directors unanimously: (i) determined that the Merger Agreement and the transactions contemplated thereby, including the Merger, are advisable, fair to, and in the best interests of the Company and its stockholders and declared it advisable for the Company to enter into the Merger Agreement; (ii) approved and declared advisable the execution and delivery by the Company of the Merger

Agreement, the performance by the Company of its covenants and agreements contained therein, and the consummation of the Merger and the other transactions contemplated thereby upon the terms and subject to the conditions contained therein; (iii) resolved that the Merger be effected under Section 251 of the General Corporation Law of the State of Delaware (the “DGCL”); (iv) directed that the Merger Agreement be submitted to the stockholders of the Company for adoption at the Special Meeting; and (v) recommended that the Company’s stockholders vote “FOR” the adoption of the Merger Agreement.

Our board of directors recommends that you vote: (1) “FOR” the Merger Proposal; (2) “FOR” the Compensation Advisory Proposal; and (3) “FOR” the Adjournment Proposal.

The accompanying proxy statement contains, among other things, detailed information about the Company, the Special Meeting, the Merger, the Merger Agreement and the Merger-related compensation. We encourage you to read the accompanying proxy statement, including its annexes and all documents incorporated by reference therein, carefully and in their entirety.

Your vote is very important, regardless of the number of shares of Common Stock that you own. We cannot complete the Merger unless the Merger Agreement is adopted by the affirmative vote of the holders of a majority of the shares of outstanding Common Stock as of the record date entitled to vote on the matter. The failure of any stockholder of record to vote in person by ballot at the Special Meeting or to submit a proxy will have the same effect as a vote “AGAINST” the Merger Proposal. If you hold your shares in “street name,” the failure to instruct your broker, bank or nominee on how to vote your shares will have the same effect as a vote “AGAINST” the Merger Proposal. If you sign, date and return your proxy card without indicating how you wish to vote, your proxy will be voted “FOR” the Merger Proposal.

We hope that you will be able to attend the Special Meeting. However, whether or not you plan to attend, please complete, sign, date and return the proxy card enclosed with the accompanying proxy statement, or, if your shares are held in “street name” through a broker, bank or nominee, instruct your broker, bank or nominee on how to vote your shares using the voting instruction form furnished by your broker, bank or nominee, as promptly as possible. Submitting a signed proxy by mail, over the Internet or by phone will ensure your shares are represented at the Special Meeting. If your shares are held in “street name” through a broker, bank or nominee, you may provide voting instructions through your broker, bank or nominee by completing and returning the voting instruction form provided by your broker, bank or nominee, or electronically over the Internet or by telephone through your broker, bank or nominee if such a service is provided. To provide voting instructions over the Internet or by telephone through your broker, bank or nominee, you should follow the instructions on the voting instruction form provided by your broker, bank or nominee.

The Special Meeting may be adjourned by the chair of the meeting if a quorum is not present or by a majority of the shares represented in person or by proxy at the Special Meeting, whether or not there is a quorum.

On behalf of our board of directors and management of the Company, I extend our appreciation for your continued support and your consideration of this matter.

Sincerely yours,

 

 

Olu Beck Board Chair		Kelli F. Valade Chief Executive Officer

203 E. Main Street

Spartanburg, South Carolina 29319

NOTICE OF SPECIAL MEETING OF STOCKHOLDERS

TO BE HELD ON [●], 2026

Notice is hereby given that a special meeting of stockholders of Denny’s Corporation, a Delaware corporation (the “Company,” “Denny’s Corporation,” “we” or “us”), will be held on [●], 2026, virtually via the Internet at [●], at [●], Eastern Time, for the following purposes:

 

•

to vote on a proposal to adopt the Agreement and Plan of Merger, dated as of November 3, 2025 (as it may be amended from time to time, the “Merger Agreement”), by and among Sparkle Topco Corp., a Delaware corporation (“Parent”), Sparkle Acquisition Corp., a Delaware corporation and wholly owned, indirect subsidiary of Parent (“Merger Sub”), and the Company, providing for, among other things, the merger of Merger Sub with and into the Company (the “Merger”), with the Company surviving the Merger as a wholly owned, indirect subsidiary of Parent (the “Merger Proposal”);

 

•

to vote on a proposal to approve, on a non-binding, advisory basis, certain compensation that may be paid or become payable to the Company’s named executive officers that is based on or otherwise relates to the Merger (the “Compensation Advisory Proposal”); and

 

•

to vote on a proposal to approve one or more adjournments of the special meeting to a later date or time, if necessary or appropriate, to solicit additional proxies if there are insufficient votes to adopt the Merger Agreement at the time of the Special Meeting (the “Adjournment Proposal”).

Only stockholders of record as of the close of business on [●], 2025 are entitled to notice of the special meeting and to vote at the special meeting or at any adjournment or postponement thereof.

The accompanying proxy statement contains, among other things, detailed information about the Merger Proposal, the Adjournment Proposal and the Compensation Advisory Proposal. We encourage you to read the accompanying proxy statement, including its annexes and all documents incorporated by reference therein, carefully and in its entirety.

The affirmative vote of the holders of a majority of the shares of the common stock of the Company, par value $0.01 (“Common Stock”), outstanding as of the record date and entitled to vote on the matter is required to approve the Merger Proposal. The affirmative vote of the holders of a majority of the votes cast at the special meeting and entitled to vote and voting on the matter is required to approve the Compensation Advisory Proposal. The affirmative vote of the holders of a majority of the votes cast at the special meeting and entitled to vote and voting on the matter is required to approve the Adjournment Proposal.

Your vote is very important, regardless of the number of shares of Common Stock that you own. The failure of any stockholder of record to vote in person by ballot at the special meeting or to submit a signed proxy card will have the same effect as a vote “AGAINST” the Merger Proposal. If you hold your shares in “street name,” you should instruct your broker, bank or nominee on how to vote your shares using the voting instruction form furnished by your broker, bank or nominee. The failure to do so will have the same effect as a vote “AGAINST” the Merger Proposal, but assuming a quorum is present, will have no effect on the outcome of any vote on the Adjournment Proposal or the Compensation Advisory Proposal. Abstentions will have the same effect as a vote “AGAINST” the Merger Proposal and will have no effect on the outcome of the Adjournment

Proposal and the Compensation Advisory Proposal. If you sign, date and return your proxy card without indicating how you wish to vote on a proposal, your proxy will be voted “FOR” such proposal.

The presence at the special meeting, in person or by proxy, of the holders of a majority of the voting power of all of the shares of stock of the Company issued, outstanding and entitled to vote constitute a quorum for the transaction of business at the special meeting. Abstentions will be counted as present for purposes of determining the existence of a quorum. Shares held in “street name” for which the applicable broker, bank or nominee receives no instructions regarding how to vote on any of the proposals before the special meeting will not be counted as present at the special meeting for quorum purposes. Shares held in “street name” for which the applicable broker, bank or nominee receives instructions regarding how to vote on one or more but not all of the proposals before the special meeting will be counted present at the special meeting for quorum purposes.

Stockholders and beneficial owners who do not vote in favor of the Merger Proposal and who otherwise meet the requirements of Section 262 of the General Corporation Law of the State of Delaware (the “DGCL”) will have the right to seek appraisal of the fair value of their shares of Common Stock, as determined in accordance with Section 262 of the DGCL. In addition to not voting in favor of the Merger Proposal, any stockholder or beneficial owner (as defined in Section 262 of the DGCL) wishing to exercise its appraisal rights must deliver a written demand for appraisal to the Company before the vote on the Merger Proposal at the special meeting and must comply in all respects with the requirements of Section 262 of the DGCL, which can be accessed without subscription or cost at the following publicly available website: https://delcode.delaware.gov/title8/c001/sc09/index.html#262.

Our board of directors recommends that you vote: (i) “FOR” the Merger Proposal; (ii) “FOR” the Compensation Advisory Proposal; and (iii) “FOR” the Adjournment Proposal.

By Order of the Board of Directors,

Sincerely yours,

 

 

Olu Beck Board Chair		Kelli F. Valade Chief Executive Officer

YOUR VOTE IS IMPORTANT

Ensure that your shares of Common Stock are voted at the special meeting by submitting your proxy or, if your shares of Common Stock are held in “street name” through a broker, bank or nominee, by contacting your broker, bank or nominee. If you do not submit a proxy, vote in person at the special meeting or instruct your broker, bank or nominee how to vote your shares, it will have the same effect as voting “AGAINST” the Merger Proposal, but assuming a quorum is present, will have no effect on the outcome of any vote on the Compensation Advisory Proposal or the Adjournment Proposal.

If your shares of Common Stock are registered directly in your name: If you are a stockholder of record, you may submit a proxy to vote your shares of Common Stock by mail, over the Internet or by phone. Please follow the instructions on the enclosed form of proxy.

If your shares of Common Stock are held in the name of a broker, bank or nominee: You will receive voting instructions from the organization holding your account and you must follow those instructions to vote your shares of Common Stock. As a beneficial owner, you have the right to direct your broker, bank or nominee on how to vote the shares of Common Stock in your account. Your broker, bank or nominee cannot vote on any of the proposals, including the Merger Proposal, without your instructions.

If you fail to submit a signed proxy card, fail to attend the special meeting or, if you hold your shares through a bank, broker or nominee, fail to provide voting instructions to your bank, broker or nominee, your shares of Common Stock will not be counted for purposes of determining whether a quorum is present at the special meeting. If you hold your shares of Common Stock through a broker, bank or nominee, you must obtain from the record holder a valid legal proxy issued in your name in order to vote in person at the special meeting. A stockholder providing a proxy may revoke it if such revocation is exercised by submitting a new proxy via Internet or by telephone before 11:59 p.m., Eastern Time on [●], 2026, the day before the special meeting, by completing, signing and dating a proxy bearing a later date and returning it to us before 11:59 p.m., Eastern Time on [●], 2026, the day before the special meeting, by providing written notice of revocation to our Secretary, or by voting in person at the special meeting. See the instructions set forth in “The Special Meeting—Revocability of Proxies” on page 20 of the accompanying proxy statement. Attendance at the special meeting alone will not revoke a submitted proxy.

We encourage you to read the accompanying proxy statement, including its annexes and all documents incorporated by reference therein, carefully and in their entirety. If you have any questions concerning the Merger, the special meeting or the accompanying proxy statement, would like additional copies of the accompanying proxy statement or need help voting your shares of Common Stock, please contact our proxy solicitor:

Okapi Partners LLC

1212 Avenue of the Americas, 17th Floor

New York, NY 10036

Banks and Brokerage Firms, Please Call: (212) 297-0720

Shareholders and All Others Call Toll-Free: (844) 203-3605

E-mail: [email protected]

YOUR VOTE IS IMPORTANT. WHETHER OR NOT YOU PLAN TO ATTEND THE SPECIAL MEETING, PLEASE SUBMIT YOUR PROXY, OR INSTRUCT YOUR BROKER, BANK OR NOMINEE ON HOW TO VOTE YOUR SHARES USING THE VOTING INSTRUCTION FORM FURNISHED BY YOUR BROKER, BANK OR NOMINEE, AS PROMPTLY AS POSSIBLE.

TABLE OF CONTENTS

 

		Page
SUMMARY			1
QUESTIONS AND ANSWERS ABOUT THE MERGER AND THE SPECIAL MEETING			14
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS			18
THE SPECIAL MEETING			19
Date, Time and Place			19
Purpose of the Special Meeting			19
Record Date; Shares Entitled to Vote; Quorum			19
Vote Required; Abstentions and Broker Non-Votes			19
Stock Ownership and Interests of Certain Persons			20
Voting of Proxies			20
Revocability of Proxies			20
Denny’s Corporation Board of Directors’ Recommendation			21
Expenses of Proxy Solicitation			21
Anticipated Date of Completion of the Merger			21
Other Matters			21
Important Notice Regarding the Availability of Proxy Materials for the Special Meeting			21
Householding of Special Meeting Materials			21
Rights of Stockholders Who Assert Appraisal Rights			22
Questions and Additional Information			22
THE MERGER			23
Parties Involved in the Merger			23
Certain Effects of the Merger			24
Effect on the Company if the Merger is Not Completed			24
Merger Consideration			24
Background of the Merger			25
Recommendations of the Denny’s Corporation Board and Reasons for the Merger			40
Opinion of Truist Securities			44
Certain Projected Financial Information			49
Interests of Denny’s Corporation Directors and Executive Officers in the Merger			52
Financing the Merger			60
Appraisal Rights			63
Material U.S. Federal Income Tax Consequences of the Merger			67
Regulatory Approvals Required for the Merger			71
THE MERGER AGREEMENT			73
Explanatory Note Regarding the Merger Agreement and the Summary of the Merger Agreement			73
Structure of the Merger			74
Consummation and Effectiveness of the Merger			74
Merger Consideration			74
Appraisal Rights			74
Exchange and Payment Procedures			75
Treatment of Denny’s Corporation Equity-Based Awards			78
Company Equity Plans			78
Conditions to the Consummation of the Merger			78
Representations and Warranties			80
Covenants Related to Conduct of Business			83
No Solicitation			87
The Denny’s Corporation Board’s Recommendation; Adverse Recommendation Change			89
Denny’s Corporation Stockholders Meeting			90
Access to Information; Confidentiality			91

 

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TABLE OF CONTENTS

(continued)

 

		Page
Efforts to Complete the Merger; Regulatory Approvals			91
Indemnification, Exculpation and Insurance			92
Employee Matters			92
Financing; Financing Cooperation			93
Sale/Leaseback Transaction			97
Treatment of the Company’s Indebtedness			98
Other Agreements			98
Termination of the Merger Agreement			99
Fees and Expenses; Termination Fees			100
Exclusive Remedy			101
Third Party Beneficiaries			101
Specific Performance			102
Governing Law; Consent to Jurisdiction			103
Amendments; Waivers			103
Waiver of Jury Trial			103
PROPOSAL 1: ADOPTION OF THE MERGER AGREEMENT			105
The Merger Proposal			105
Vote Required and Board Recommendation			105
PROPOSAL 2: ADVISORY VOTE ON MERGER-RELATED NAMED EXECUTIVE OFFICER COMPENSATION			106
The Compensation Advisory Proposal			106
Vote Required and Board Recommendation			106
PROPOSAL 3: ADJOURNMENT OF THE SPECIAL MEETING			107
The Adjournment Proposal			107
Vote Required Board Recommendation			107
MARKET PRICES AND DIVIDEND DATA			108
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT			109
HOUSEHOLDING OF PROXY MATERIALS			111
FUTURE STOCKHOLDER PROPOSALS			112
WHERE YOU CAN FIND MORE INFORMATION			113
ANNEX A: MERGER AGREEMENT			A-1
ANNEX B: OPINION OF TRUIST SECURITIES, INC.			B-1

 

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SUMMARY

This summary, together with the following section of this proxy statement entitled “Questions and Answers About the Special Meeting and the Merger,” highlights selected information from this proxy statement and may not contain all the information that is important to you as a holder of Common Stock or that you should consider before voting on the Merger Proposal. To better understand the Merger Proposal, you should read this proxy statement, including its annexes and the documents incorporated by reference herein, carefully and in its entirety. You may obtain the documents and information incorporated by reference into this proxy statement without charge by following the instructions under “Where You Can Find More Information” on page 113 of this proxy statement. The Merger Agreement is attached as Annex A to this proxy statement and is incorporated by reference herein.

Parties Involved in the Merger (see page 23)

Denny’s Corporation

203 East Main Street

Spartanburg, South Carolina 29319

Denny’s Corporation is a Delaware-based company operating two restaurant brands, Denny’s and Keke’s Breakfast Cafe, with a total of 1,568 restaurants as of December 25, 2024—1,493 franchised or licensed and 75 company-operated. Denny’s, known for its 24/7 service and all-day breakfast menu, accounted for 1,499 locations, 96% of which were franchised or licensed, including 165 international units. Keke’s, acquired in 2022, is a daytime eatery focused on made-to-order breakfast and lunch, with 69 U.S. locations, 80% of which are franchised.

Denny’s Corporation Common Stock is listed under the symbol “DENN” on The Nasdaq Stock Market, LLC (“Nasdaq”).

Sparkle Topco Corp.

445 Park Avenue, 17^th Floor

New York, NY 10022

Sparkle Topco Corp. is a Delaware corporation that was formed on October 30, 2025, solely for the purpose of engaging in the transactions contemplated by the Merger Agreement, and has not engaged in any activities other than in connection with or as contemplated by the Merger Agreement. Sparkle Topco Corp. is controlled by funds managed by affiliates of TriArtisan Capital Advisors LLC (“TriArtisan Capital Advisors”).

Upon consummation of the Merger in accordance with the Merger Agreement, Parent will be the parent company of Denny’s Corporation.

Sparkle Acquisition Corp.

445 Park Avenue, 17^th Floor

New York, NY 10022

Merger Sub is a Delaware corporation that was formed solely for the purpose of engaging in the transactions contemplated by the Merger Agreement, and has not engaged in any activities other than in connection with or as contemplated by the Merger Agreement. Merger Sub is a wholly owned, indirect subsidiary of Parent that was incorporated on October 30, 2025. Upon consummation of the Merger, Merger Sub will cease to exist, and Denny’s Corporation will survive the Merger as a wholly owned, indirect subsidiary of Parent.

TriArtisan Capital Advisors LLC

445 Park Avenue, 17^th Floor

New York, NY 10022

TriArtisan Capital Advisors invests and manages private equity capital provided by a broad roster of institutions including sovereign wealth funds, alternative asset managers, and family offices, and targets investments in companies with EBITDA of $25-300 million across multiple industries including Retail / Consumer, Business and Professional Services, Industrial, Media and Healthcare.

Date, Time and Place

A special meeting of our stockholders will be held on [●], 2026 at [●], Eastern Time (the “Special Meeting”). The Special Meeting will be held in a virtual format only and will be accessible through the Internet. You will be able to attend the Special Meeting by visiting [●]. A secure control number that will allow you to participate in the meeting electronically can be found on the enclosed proxy card. For purposes of attendance at the Special Meeting, all references in this proxy statement to “present in person” or “in person” shall mean virtually present at the Special Meeting.

Record Date; Shares Entitled to Vote

You are entitled to vote at the Special Meeting if you owned shares of Common Stock at the close of business on [●], 2025 (the “Record Date”). You will have one vote at the Special Meeting for each share of Common Stock you owned at the close of business on the Record Date.

Stockholder List

For a period of ten days ending on the day before the Special Meeting date, a list of our stockholders entitled to vote at the Special Meeting will be available for inspection by any stockholder for any purpose germane to the Special Meeting during ordinary business hours at our corporate offices located at 203 East Main Street Spartanburg, South Carolina 29319.

Purpose

At the Special Meeting, we will ask our stockholders of record as of the Record Date to vote on the following proposals:

(i) to adopt the Merger Agreement (the “Merger Proposal”);

(ii) to approve, on a non-binding, advisory basis, certain compensation that may be paid or become payable to our named executive officers that is based on or otherwise relates to the Merger (the “Compensation Advisory Proposal”); and

(iii) to approve one or more adjournments of the Special Meeting to a later date or time, if necessary or appropriate, to solicit additional proxies if there are insufficient votes to adopt the Merger Agreement at the time of the Special Meeting (the “Adjournment Proposal”).

Quorum

As of the Record Date, there were [●] shares of Common Stock outstanding and entitled to be voted at the Special Meeting. The holders of a majority of the voting power of all of the shares of stock of the Company issued, outstanding and entitled to vote constitute a quorum for the transaction of business at the Special Meeting. As a result, for business to be transacted at the Special Meeting, at least [●] shares of Common Stock must be represented by proxy or by stockholders entitled to vote at the Special Meeting.

 

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Required Vote

Approval of the Merger Proposal requires the affirmative vote of the holders of a majority of the shares of Common Stock outstanding as of the Record Date and entitled to vote on the matter. Approval of the Compensation Advisory Proposal and the Adjournment Proposal requires the affirmative vote of the holders of a majority of the votes cast at the Special Meeting. Abstentions or a failure to vote will have the same effect as a vote “AGAINST” the Merger Proposal but will have no effect on the outcome of the Adjournment Proposal and the Compensation Advisory Proposal. The failure of any stockholder of record to vote in person by ballot at the Special Meeting or to submit a signed proxy card will have the same effect as a vote “AGAINST” the Merger Proposal. If you hold your shares in “street name,” the failure to instruct your broker on how to vote your shares will have the same effect as a vote “AGAINST” the Merger Proposal, but assuming a quorum is present, will have no effect on the outcome of any vote on the Adjournment Proposal or the Compensation Advisory Proposal.

Stock Ownership and Interests of Certain Persons

As of the Record Date, our directors and executive officers beneficially owned and were entitled to vote an aggregate of [●] shares of Common Stock, representing approximately [●]% of the outstanding shares of Common Stock. Our directors and executive officers have informed us that they currently intend to vote all of their shares of Common Stock: (i) “FOR” the Merger Proposal; (ii) “FOR” the Compensation Advisory Proposal; and (iii) “FOR” the Adjournment Proposal.

Voting of Proxies

Any Company stockholder of record entitled to vote at the Special Meeting may submit a proxy by returning a signed proxy card by mail or submitting a proxy over the Internet or by telephone or may attend the Special Meeting and vote in person. If you are a beneficial owner and hold your shares of Common Stock in “street name” through a broker, bank or nominee, you should instruct your broker, bank or nominee on how you wish to vote your shares of Common Stock using the instructions provided by your broker, bank or nominee. Under applicable stock exchange rules, brokers, banks or nominees have the discretion to vote your shares on routine matters if you fail to instruct your broker, bank or nominee on how to vote your shares with respect to such matters. The proposals in this proxy statement are non-routine matters, and brokers, banks and nominees therefore cannot vote on these proposals without your instructions. Generally, if a broker exercises its discretion on routine matters at a stockholder meeting, a stockholder’s shares will be voted on the routine matter in the manner directed by the broker, but will constitute a “broker non-vote” on all of the non-routine matters to be presented at the stockholder meeting. Because all of the proposals to be voted on at the Special Meeting are non-routine matters, if you hold your shares in street name through a brokerage account, your broker will not be able to exercise its discretion to vote uninstructed shares on any of the proposals presented at the Special Meeting. As a result, we do not expect any broker non-votes at the Special Meeting. Therefore, it is important that you instruct your broker, bank or nominee on how you wish to vote your shares of Common Stock or that you obtain from such broker, bank or nominee a valid legal proxy issued in your name and vote in person at the Special Meeting.

If you are a stockholder of record, you may change your vote or revoke your proxy at any time before it is voted at the Special Meeting by signing another proxy card with a later date and returning it to us before 11:59 p.m., Eastern Time on [●], 2026, the day before the Special Meeting, by providing written notice of revocation to our Secretary before your proxy is exercised, by submitting a new proxy card electronically over the Internet or by telephone after the date of the earlier submitted proxy, or by accessing the Special Meeting virtually and voting during the Special Meeting. See the instructions set forth in “The Special Meeting—Revocability of Proxies” on page 20 of this proxy statement. If you hold your shares of Common Stock in “street name,” you should contact your broker, bank or nominee for instructions regarding how to change your vote.

 

3

The failure of any stockholder of record to submit a proxy or to vote in person by ballot at the Special Meeting will have the same effect as a vote “AGAINST” the Merger Proposal. If you sign, date and return your proxy card without indicating how you wish to vote on the Merger Proposal, your proxy will be voted “FOR” the Merger Proposal. Broker non-votes, if any, will have the same effect as a vote “AGAINST” the Merger Proposal, but assuming a quorum is present, will have no effect on the outcome of any vote on the Compensation Advisory Proposal or the Adjournment Proposal. Because all of the proposals to be voted on at the Special Meeting are non-routine matters, if you hold your shares in street name through a brokerage account, your broker will not be able to exercise its discretion to vote uninstructed shares on any of the proposals presented at the Special Meeting and, as a result, we do not expect any broker non-votes at the Special Meeting. Abstentions will have the same effect as a vote “AGAINST” the Merger Proposal and will have no effect on the outcome of the Adjournment Proposal and the Compensation Advisory Proposal.

Neither the U.S. Securities Exchange Commission (the “SEC”) nor any state securities regulatory agency has approved or disapproved of the transactions described in this proxy statement, including the Merger, passed upon the merits or fairness of such transactions, or passed upon the adequacy or accuracy of the disclosure in this proxy statement. Any representation to the contrary is a criminal offense.

Expenses of Proxy Solicitation (see page 21)

Our board of directors (the “Board”) is soliciting your proxy, and the Company will bear the cost of soliciting proxies. We have engaged the services of Okapi Partners LLC (“Okapi”) to solicit proxies for the Special Meeting. In connection with its retention, Okapi has agreed to provide strategic advice, analytic, and proxy solicitation services. We have agreed to pay Okapi an initial fee for its proxy solicitation services of $15,000, plus additional fees for consulting and related services and a performance fee payable upon the successful conclusion of the solicitation, plus reimbursement for out-of-pocket expenses. We have also agreed to indemnify Okapi for certain losses arising out of its proxy solicitation services. In addition to the solicitation of proxies by mail, proxies may be solicited by our directors, officers and employees, or representatives of Okapi, in person or by telephone, email, fax or other means of communication, and we may pay persons holding shares of Common Stock on behalf of others their expenses for sending proxy materials to their principals. No additional compensation will be paid to our directors, officers or employees for their services in connection with solicitation of proxies, but our directors and officers may be reimbursed for out-of-pocket expenses incurred in connection with the solicitation.

Certain Effects of the Merger (see page 24)

Upon the terms and subject to the conditions of the Merger Agreement, Merger Sub will merge with and into the Company, with the Company continuing as the surviving company (the “Surviving Company”) and, as a result of the Merger, the separate corporate existence of Merger Sub will cease, and the Company will continue as a wholly owned, indirect subsidiary of Parent. As promptly as practicable following the effective time of the Merger (the “Effective Time”), the Company and our Common Stock will be delisted from Nasdaq and our Common Stock will be deregistered under the Securities Exchange Act of 1934, as amended (the “Exchange Act”). If the Merger is completed, you will not own any shares of common stock of the Surviving Company, and instead will only be entitled to receive the Merger Consideration described below (unless you are entitled to and have properly demanded appraisal for your shares in accordance with Section 262 of the DGCL, in which case your shares will be cancelled and cease to exist and you will be entitled to the rights granted under Section 262 of the DGCL).

The Effective Time will occur upon the filing of a certificate of merger with the Secretary of State of the State of Delaware (or at such later date and time as the Company, Parent and Merger Sub may agree and specify in the certificate of merger).

 

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Effect on Denny’s Corporation if the Merger is Not Completed (see page 24)

If the Merger Proposal is not approved by the stockholders of Denny’s Corporation or if the Merger is not completed for any other reason, you will not receive any payment for your shares of Common Stock. Instead, we will remain a public company, our Common Stock will continue to be listed and traded on Nasdaq and registered under the Exchange Act, and we will continue to be obligated to file periodic reports with the SEC. Under specified circumstances, we may be required to pay Parent a termination fee or may be entitled to receive a termination fee from Parent upon the termination of the Merger Agreement, as described in “The Merger Agreement—Fees and Expenses; Termination Fees” on page 100 of this proxy statement.

Merger Consideration (see page 74)

At the Effective Time, each outstanding share of Common Stock (other than (i) shares owned directly by the Company (or any of its wholly owned subsidiaries) or owned by Parent, Merger Sub or any of their respective affiliates (collectively, “Cancelled Shares”) and (ii) shares held by stockholders who are entitled to and have properly demanded appraisal for such shares in accordance with Section 262 of the DGCL (“Dissenting Shares”)) will be converted automatically into the right to receive $6.25 in cash, without interest and less any applicable withholding tax (the “Merger Consideration”). All shares of Common Stock converted into the right to receive the Merger Consideration will automatically be cancelled and cease to exist at the Effective Time.

As described further in “The Merger Agreement—Exchange and Payment Procedures” on page 75 of this proxy statement, prior to the Effective Time, the Company and Parent shall enter into a paying agent agreement with the Paying Agent (as defined in “The Merger Agreement—Exchange and Payment Procedures” on page 75 of this proxy statement), for which Parent shall pay, or cause to be paid, the fees and expenses of the Paying Agent. Parent shall deposit, or cause to be deposited, with the Paying Agent cash in immediately available funds in an amount equal to the aggregate Merger Consideration. Following the completion of the Merger, after a stockholder has provided the Paying Agent with such stockholder’s stock certificates, if applicable, and a letter of transmittal, if required by the Paying Agent, Parent will cause the Paying Agent to pay the stockholder the Merger Consideration to which such stockholder is entitled. Holders of shares of Common Stock in book-entry form who hold such shares through The Depository Trust Company (“DTC”) will be handled in accordance with DTC’s customary procedures.

After the completion of the Merger, under the terms of the Merger Agreement, you will have the right to receive the Merger Consideration, but you will no longer have any rights as a Denny’s Corporation stockholder (except that stockholders who hold Dissenting Shares will not have the right to receive the Merger Consideration but will instead have the right to receive a payment for the “fair value” of their Dissenting Shares as determined by the Delaware Court of Chancery pursuant to an appraisal proceeding as contemplated by Delaware law, as described in “The Merger—Appraisal Rights” on page 63 of this proxy statement).

Treatment of Equity Awards and the Denny’s Corporation Equity Plans (see page 78)

Pursuant to the Merger Agreement, (i) each outstanding award of restricted stock units (including deferred stock units granted to the Company’s non-employee directors) with respect to Company Shares (as defined in the Merger Agreement) issued under a Company Equity Plan (as defined in the Merger Agreement) subject to vesting or forfeiture based solely on criteria related to continued service or employment (each, a “Company RSU Award”) will, by virtue of the Merger, automatically and without any action on the part of the Company, Parent or the holder thereof, be cancelled and terminated and converted into the right of the holder of the Company RSU Award to receive from the Surviving Company an amount in cash (without interest and less any applicable withholding taxes), equal to the product of (A) the aggregate number of Company Shares underlying such Company RSU Award, multiplied by (B) the Merger Consideration, and (ii) each outstanding award of restricted stock units with respect to Company Shares issued under a Company Equity Plan that is subject to conditions of

 

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vesting or forfeiture that are based on performance criteria (each, a “Company PSU Award”) will, by virtue of the Merger, automatically and without any action on the part of the Company, Parent or the holder thereof, be cancelled and terminated and converted into the right of the holder of the Company PSU Award to receive from the Surviving Company an amount in cash (without interest and subject to applicable withholding taxes), equal to the product of (A) the aggregate number of Company Shares underlying such Company PSU Award (with such number of Company Shares determined in accordance with the terms of the applicable award agreement pursuant to which such Company PSU Award was granted (and without discretionary adjustment by the Board (or a committee thereof))), multiplied by (B) the Merger Consideration. Any Company PSU Award that is unvested as of immediately prior to the Effective Time in accordance with the terms of the applicable award agreement pursuant to which it was granted will automatically be cancelled without further action and for no consideration.

Pursuant to the Merger Agreement, the Company Board (or a committee thereof) will take all actions necessary, with effect as of the Effective Time, to terminate each Company Equity Plan, including under which there are outstanding awards of deferred stock units subject to Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”).

Recommendations of the Denny’s Corporation Board and Reasons for the Merger (see page 40)

The Board, after consulting with its financial advisor and outside legal counsel and carefully reviewing and considering various factors described in “The Merger—Recommendations of the Denny’s Corporation Board and Reasons for the Merger” on page 40 of this proxy statement, unanimously: (i) determined that the Merger Agreement and the transactions contemplated thereby, including the Merger, are advisable, fair to, and in the best interests of the Company and its stockholders and declared it advisable for the Company to enter into the Merger Agreement; (ii)approved and declared advisable the execution and delivery by the Company of the Merger Agreement, the performance by the Company of its covenants and agreements contained therein, and the consummation of the Merger and the other transactions contemplated thereby upon the terms and subject to the conditions contained therein; (iii) resolved that the Merger be effected under Section 251 of the DGCL; (iv) directed that the Merger Agreement be submitted to the stockholders of the Company for adoption at the Special Meeting; and (v) recommended that the Company’s stockholders vote “FOR” the adoption of the Merger Agreement.

Opinion of Truist Securities (see page 44)

On November 3, 2025, Truist Securities, Inc. (“Truist Securities”) rendered its oral opinion to the Board (which was subsequently confirmed in writing by delivery of Truist Securities’ written opinion dated November 3, 2025) as to the fairness, from a financial point of view, to the holders of Company Shares of the Merger Consideration to be received by such holders in the Merger pursuant to the Merger Agreement.

Truist Securities’ opinion was directed to the Board (in its capacity as such) and only addressed the fairness, from a financial point of view, to the holders of Company Shares of the Merger Consideration to be received by such holders in the Merger pursuant to the Merger Agreement and did not address any other aspect or implication of the Merger or any agreement, arrangement or understanding entered into in connection therewith or otherwise. The summary of Truist Securities’ opinion in this proxy statement is qualified in its entirety by reference to the full text of its written opinion, which is included as Annex B to this proxy statement and sets forth the procedures followed, assumptions made, qualifications to and limitations on the review undertaken and other matters considered by Truist Securities in preparing its opinion. However, neither Truist Securities’ written opinion nor the summary of its opinion and the related analyses set forth in this proxy statement is intended to be, nor does any of them constitute, advice or a recommendation as to, or otherwise address, how the Board, the Company, any security holder or any other person should act or vote with respect to any matter relating to the Merger or otherwise.

 

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Interests of Denny’s Corporation Directors and Executive Officers in the Merger (see page 52)

When considering the recommendation of the Board that you vote “FOR” the Merger Proposal, you should be aware that certain of our directors and executive officers may have interests in the Merger that may be different from, or in addition to, your interests as a stockholder. You should be aware that the Company’s directors and executive officers may have certain interests in the Merger that may be different from, or in addition to, the interests of the Company’s stockholders more generally, including (a) the accelerated vesting, cancellation and cash-out of Company RSU Awards and Company PSU Awards in connection with the Merger, as described in more detail in the section titled “Interests of Denny’s Corporation Directors and Executive Officers in the Merger—Treatment of Company Equity Awards,” (b) the entitlement of executive officers to receive severance payments and other benefits pursuant to the Severance Plan (as defined below) in the event of certain terminations of employment in connection with, or following, the Merger, which for purposes of such severance plan constitutes a “change in control”, as described in more detail in the section titled “Interests of Denny’s Corporation Directors and Executive Officers in the Merger—Potential Change in Control and Severance Entitlements to the Company’s Executive Officers,” and (c) the entitlement of certain executive officers to a lump sum payment in respect of their notional accounts under the Company’s Deferred Compensation Plan, as amended and restated, as described in more detail in the section titled “Interests of Denny’s Corporation Directors and Executive Officers in the Merger—Nonqualified Deferred Compensation Plan.”

The Board was aware of these interests and considered them, among other matters, in (1) evaluating and negotiating the Merger Agreement, (2) approving the Merger Agreement and the Merger, and (3) recommending that the Merger Agreement Proposal be approved by the Company’s stockholders.

These interests, among others, are discussed in more detail in “Interests of Denny’s Corporation Directors and Executive Officers in the Merger” on page 52 of this proxy statement.

Financing the Merger (see page 60)

The Merger is not subject to any financing condition. Parent estimates that the total funds necessary to complete the Merger and pay the Merger Consideration will be approximately $640 million, including the amounts necessary to (i) pay the aggregate Merger Consideration and the other amounts required to be paid by Parent or Merger Sub in connection with the consummation of the Transactions; (ii) pay all related fees, costs and expenses incurred by Parent in connection with the Transactions; and (iii) repay certain indebtedness of the Company, as contemplated by the Merger Agreement. Parent expects these amounts to be funded through a combination of (i) an equity commitment of up to $220 million (the “Equity Financing”), (ii) committed senior secured term loan financing in an aggregate amount of $300 million, and (iii) proceeds of a sale/leaseback transaction of up to approximately $146.8 million.

Parent has delivered to the Company an equity commitment letter (the “Equity Commitment Letter”), pursuant to which TriArtisan Capital Advisors has agreed to make, or cause to be made, an equity investment in Parent, on the terms and subject to the conditions set forth therein, in the aggregate amount of up to $220 million in cash.

Parent has delivered to the Company a debt commitment letter (the “Debt Commitment Letter”), pursuant to which the Debt Financing Sources (as defined in the Merger Agreement) have committed to provide debt financing to wholly owned, indirect subsidiary of Parent, on the terms and subject to the conditions set forth therein, in an aggregate amount of $335 million, consisting of a $300 million senior secured term loan facility and a $35 million senior secured revolving credit facility.

Parent has delivered to the Company a purchase and sale agreement (the “Sale/Leaseback Purchase and Sale Agreement”), pursuant to which the sale/leaseback purchaser has agreed to purchase, substantially concurrent

 

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with the consummation of the Merger and on the terms and subject to the conditions set forth therein, certain of the Company’s owned real property assets for up to approximately $146.8 million, and immediately lease back to the Company certain of those properties (the “Sale/Leaseback Transaction”).

The Company and TriArtisan Capital Advisors have also entered into a limited guarantee (the “Limited Guarantee”) with respect to the Parent Termination Fee (as defined below), if and when payable pursuant to the Merger Agreement, and certain other obligations as expressly set forth in the Limited Guarantee, in each case up to the aggregate amount specified therein and subject to the terms and conditions of the Limited Guarantee and the Merger Agreement.

Appraisal Rights (see page 63)

Record holders and beneficial owners of Common Stock of the Company will be entitled to seek statutory appraisal of their shares pursuant to Section 262 of the DGCL in connection with the Merger. This means that such stockholders and beneficial owners are entitled to seek appraisal of their Dissenting Shares and, if all requirements of Section 262 of the DGCL are met, to receive payment in cash for the “fair value” of such Dissenting Shares, exclusive of any element of value arising from the accomplishment or expectation of the Merger, as determined by the Delaware Court of Chancery, together with interest, if any, to be paid upon the amount determined to be the fair value. The ultimate amount holders receive in an appraisal proceeding may be less than, equal to or more than the amount such holders would have received under the Merger Agreement. For a description of the rights of holders of Dissenting Shares and of the procedures to be followed in order to assert such rights and obtain payment of the fair value of such Dissenting Shares, see Section 262 of the DGCL, which can be accessed without subscription or cost at the following publicly available website: https://delcode.delaware.gov/title8/c001/sc09/index.html#262, as well as the information set forth below.

IN ORDER TO PROPERLY EXERCISE YOUR APPRAISAL RIGHTS IN CONNECTION WITH THE MERGER, A RECORD HOLDER OR BENEFICIAL OWNER MUST DELIVER A WRITTEN DEMAND FOR APPRAISAL IN ACCORDANCE WITH THE REQUIREMENTS OF SECTION 262 OF THE DGCL TO DENNY’S CORPORATION BEFORE THE VOTE IS TAKEN ON THE ADOPTION OF THE MERGER AGREEMENT AT THE SPECIAL MEETING, MUST NOT VOTE, IN PERSON OR BY PROXY, IN FAVOR OF THE MERGER PROPOSAL, MUST CONTINUE TO HOLD SHARES OF COMMON STOCK FROM THE DATE OF MAKING THE DEMAND FOR APPRAISAL THROUGH THE EFFECTIVE TIME OF THE MERGER AND MUST COMPLY WITH THE OTHER REQUIREMENTS OF SECTION 262 OF THE DGCL. MERELY VOTING AGAINST THE MERGER PROPOSAL WILL NOT PRESERVE YOUR RIGHT TO APPRAISAL UNDER SECTION 262 OF THE DGCL. BECAUSE A PROXY THAT IS SIGNED AND SUBMITTED BUT DOES NOT OTHERWISE CONTAIN VOTING INSTRUCTIONS WILL, UNLESS REVOKED, BE VOTED IN FAVOR OF THE ADOPTION OF THE MERGER AGREEMENT, IF YOU SUBMIT A PROXY AND WISH TO EXERCISE YOUR APPRAISAL RIGHTS, YOU MUST INCLUDE VOTING INSTRUCTIONS TO VOTE YOUR SHARES OF COMMON STOCK AGAINST, OR ABSTAIN WITH RESPECT TO, THE ADOPTION OF THE MERGER AGREEMENT. NEITHER VOTING AGAINST THE ADOPTION OF THE MERGER AGREEMENT, NOR ABSTAINING FROM VOTING OR FAILING TO VOTE ON THE MERGER PROPOSAL, WILL IN AND OF ITSELF CONSTITUTE A WRITTEN DEMAND FOR APPRAISAL SATISFYING THE REQUIREMENTS OF SECTION 262 OF THE DGCL. THE WRITTEN DEMAND FOR APPRAISAL MUST BE IN ADDITION TO AND SEPARATE FROM ANY PROXY OR VOTE ON THE ADOPTION OF THE MERGER AGREEMENT. IN VIEW OF THE COMPLEXITY OF THE DGCL, STOCKHOLDERS AND BENEFICIAL OWNERS WHO MAY WISH TO PURSUE APPRAISAL RIGHTS SHOULD PROMPTLY CONSULT THEIR LEGAL AND FINANCIAL ADVISORS.

Material U.S. Federal Income Tax Consequences of the Merger (see page 67)

The receipt of cash in exchange for shares of Common Stock pursuant to the Merger will generally be a taxable transaction for U.S. federal income tax purposes. The receipt of cash by a U.S. holder (as defined in “The Merger—Material U.S. Federal Income Tax Consequences of the Merger” on page 67 of this proxy statement)

 

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in exchange for such U.S. holder’s shares of Common Stock in the Merger will generally result in the recognition of taxable gain or loss in an amount equal to the difference, if any, between the cash such U.S. holder receives in the Merger (including any amounts required to be withheld for tax purposes) and such U.S. holder’s adjusted tax basis in such surrendered shares. Gain or loss will be determined separately for each block of shares of Common Stock (that is, shares acquired for the same cost in a single transaction). A non-U.S. holder (as defined in “The Merger—Material U.S. Federal Income Tax Consequences of the Merger” on page 67 of this proxy statement) will generally not be subject to U.S. federal income tax with respect to the exchange of such non-U.S. holder’s shares of Common Stock for cash in the Merger unless such non-U.S. holder has certain connections to the United States. Stockholders should refer to “The Merger—Material U.S. Federal Income Tax Consequences of the Merger” on page 67 of this proxy statement, and consult their own tax advisors concerning the U.S. federal income tax consequences to them of the Merger in light of their particular circumstances and any consequences arising under the laws of any state, local or non-U.S. jurisdiction.

Regulatory Approvals Required for the Merger (see page 71)

Under the terms of the Merger Agreement, Parent must notify the Company in writing by November 26, 2025, of its determination of whether any filings are required under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (the “HSR Act”). If filings are required under the HSR Act, Parent and the Company would be required to make such premerger notification filings within 15 Business Days of Parent’s notice and to await the expiration or termination of the statutory waiting period under the HSR Act prior to completing the Merger. Parent has notified the Company that it does not expect a filing to be required under the HSR Act to consummate the Merger.

Under the terms of the Merger Agreement, Parent and the Company have agreed to use their reasonable best efforts to obtain all required regulatory approvals. The parties shall be mutually responsible for substantive communications and strategic and timing decisions relating to the HSR Act and any other applicable antitrust laws, but if there is a disagreement that the parties cannot resolve, the determination of Parent shall prevail. Parent must use reasonable best efforts to take, or cause to be taken, all appropriate action and do, or cause to be done all things necessary, proper or advisable under any law to enable the parties to close the Merger by June 30, 2026 (as such date may be extended by the mutual written consent of the Company, Parent and Merger Sub, the “Outside Date”). However, the parties are not required to agree to take any action that is not conditioned upon the Merger, or that would reasonably be expected to have a material adverse impact on the Company or the benefits expected from the Merger.

No Solicitation of Other Offers; Change of Recommendation (see page 87)

The Company has agreed under the Merger Agreement to, through the Board, recommend to the Company’s stockholders that they vote in favor of the adoption of the Merger Agreement (the “Denny’s Recommendation”) and to include such recommendation in this proxy statement.

The Merger Agreement provides that, subject to the exceptions described below, neither the Board nor any committee thereof, will take any of the following actions (any such action, a “Denny’s Adverse Recommendation Change”):

 

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withhold or withdraw (or change, modify, amend or qualify in a manner adverse to Parent or Merger Sub) (or publicly propose to withhold or withdraw (or change, modify, amend or qualify in a manner adverse to Parent or Merger Sub)) the Denny’s Recommendation;

 

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approve, endorse, adopt, recommend or otherwise declare advisable, or propose publicly to approve, endorse, adopt, recommend or otherwise declare advisable, any Company Acquisition Proposal (as defined in “The Merger Agreement—No Solicitation” on page 87 of this proxy statement);

 

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fail to include the Denny’s Recommendation in this proxy statement;

 

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if any Company Acquisition Proposal that is not subject to Regulation 14D under the Exchange Act has been made public, fail to reaffirm the Denny’s Recommendation upon request by Parent within the earlier of three business days prior to the Denny’s Corporation Stockholders Meeting or ten business days after Parent requests in writing such reaffirmation with respect to such Company Acquisition Proposal; or

 

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fail to recommend, in a Solicitation/Recommendation Statement on Schedule 14D-9, against any Company Acquisition Proposal subject to Regulation 14D under the Exchange Act within ten business days after the commencement thereof.

Further, the Company will not, and will use its reasonable best efforts to cause its subsidiaries and its and their representatives (on behalf of the Company of the Company’s subsidiaries) not to, approve, endorse or recommend or publicly propose to approve, endorse or recommend, or execute or enter into, any merger agreement, acquisition agreement, exchange agreement, joint venture agreement, partnership agreement, option agreement, letter of intent, memorandum of understanding, agreement in principle, confidentiality agreement or other similar agreement or arrangement for, relating to or that would reasonably be expected to result in or lead to any Company Acquisition Proposal (other than a permitted confidentiality agreement).

Notwithstanding the foregoing restrictions, at any time prior to obtaining the Denny’s Stockholder Approval, the Board may make a Denny’s Adverse Recommendation Change in response to either (A) a Superior Company Proposal (as defined in “The Merger Agreement—No Solicitation” on page 87 of this proxy statement) that did not result from a breach of the Merger Agreement or (B) a Denny’s Intervening Event (as defined in “The Merger Agreement—No Solicitation” on page 87 of this proxy statement), if, in either case, the Board determines in good faith (after consultation with its outside counsel and financial advisors) that the failure to do so would be inconsistent with its fiduciary duties under applicable law. In the case of a Superior Company Proposal, the Board may also cause the Company to terminate the Merger Agreement to enter into a definitive agreement with respect to such Superior Company Proposal (so long as the Company pays the Denny’s Termination Fee as described below).

For a further discussion, see “The Merger Agreement—No Solicitation” on page 87 of this proxy statement.

Conditions to the Consummation of the Merger (see page 78)

The completion of the Merger is subject to the satisfaction or, where permitted by law, waiver by written consent of several conditions, including (among other conditions):

 

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the approval of the proposal to adopt the Merger Agreement by the vote of holders of a majority of shares of the Company’s Common Stock outstanding and entitled to vote (the “Denny’s Stockholder Approval”);

 

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(a) the expiration of termination of any waiting period (and any extension thereof) applicable to the Merger and the other transactions contemplated hereby under the HSR Act and (b) the receipt of all required consents and expirations or terminations of waiting or review periods (as applicable) with respect to any other specified regulatory approvals (the “Required Regulatory Approvals”);

 

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the absence of (a) any law (whether temporary, preliminary or permanent) or (b) judgment, order, decision, writ, injunction, decree, ruling, legal or arbitration award, stipulation, SEC requirement or settlement or consent agreement, in each case, with a governmental entity of competent jurisdiction that is binding on the applicable person under applicable law (in each case, whether temporary, preliminary or permanent) that is in effect and has the effect of making the Merger illegal or which has the effect of prohibiting or otherwise preventing the consummation of the Merger and the other transactions contemplated by the Merger Agreement (any such item pursuant to clauses (a) or (b), a “Legal Restraint”);

 

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the accuracy of the representations and warranties of each party, subject in some instances to materiality or “material adverse effect” qualifiers;

 

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the performance in all material respects by each party of its covenants and agreements required to be performed under the Merger Agreement on or before the Closing Date; and

 

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since the date of the Merger Agreement, the absence of a “Denny’s Material Adverse Effect” (as defined in “The Merger Agreement—Representations and Warranties” on page 80 of this proxy statement).

For a further discussion, see “The Merger Agreement—Conditions to the Consummation of the Merger” on page 78 of this proxy statement.

Termination of the Merger Agreement (see page 99)

The Merger Agreement may be terminated prior to the effective time of the Merger in the following ways, among others:

 

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By mutual written agreement of the Company and Parent.

 

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By either the Company or Parent if:

 

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the Merger has not been consummated by the Outside Date, which termination right is not available to a party whose material breach of the Merger Agreement was the principal cause of the failure of the Effective Time to occur by the Outside Date;

 

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any governmental entity of competent and applicable jurisdiction has issued or enacted a Legal Restraint, and such Legal Restraint has become final and nonappealable, which termination right will be available only if the party seeking to terminate the Merger Agreement (including, in the case of Parent and Merger Sub) shall have complied in all material respects with its applicable efforts obligations under the Merger Agreement; or

 

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the Denny’s Stockholder Approval is not obtained at the Special Meeting or at any adjournment or postponement thereof.

By Parent if:

 

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the Company has breached its representations, warranties, or covenants such that a closing condition would not be satisfied, and such breach is not cured within 30 days of notice (so long as Parent is not then in material breach of its own obligations); or

 

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prior to the Denny’s Stockholder Approval, the Board makes a Denny’s Adverse Recommendation Change.

 

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By the Company if:

 

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Parent or Merger Sub has breached their representations, warranties, or covenants such that a closing condition would not be satisfied, and such breach is not cured within 30 days of notice (so long as the Company is not then in material breach of its own obligations);

 

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the closing conditions have been satisfied (other than those conditions that by their nature are to be satisfied as of the Closing, but subject to such conditions being able to be satisfied or waived at the Closing) but Parent fails to consummate the Merger within three business days after the Company confirms that the Company is ready, willing and able to consummate the Merger; or

 

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at any time prior to obtaining the Denny’s Stockholder Approval, to enter into a definitive agreement with respect to a Superior Company Proposal, so long as the Company has complied with its non-solicitation obligations and concurrently pays the Parent Termination Fee and applicable reimbursements and, substantially concurrently with such termination, the Company enters into a definitive agreement with respect to such Superior Company Proposal.

For a further discussion, see “The Merger Agreement—Termination of the Merger Agreement” on page 99 of this proxy statement.

 

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Fees and Expenses (see page 100)

Except in specified circumstances, all fees and expenses incurred in connection with the transactions contemplated by the Merger Agreement will be paid by the party incurring such fees or expenses.

For a further discussion, see “The Merger Agreement—Fees and Expenses; Termination Fees” on page 100 of this proxy statement.

Termination Fees (see page 100)

Under the Merger Agreement, the Company may be required to pay Parent (or its designee) a termination fee of $10,320,000 (the “Denny’s Termination Fee”), and Parent may be required to pay the Company a termination fee of $17,200,000 (the “Parent Termination Fee”), if the Merger Agreement is terminated under specified circumstances.

The Company is obligated to pay the Denny’s Termination Fee if, among other reasons, the Merger Agreement is terminated by Parent prior to obtaining the Denny’s Stockholder Approval because the Board made a Denny’s Adverse Recommendation Change, or if the Merger Agreement is terminated by Parent or the Company because the Company terminates to enter into a definitive agreement for a Superior Company Proposal. In addition, the Denny’s Termination Fee is also payable if the Merger Agreement is terminated due to the Outside Date having passed, the failure to obtain the Denny’s Stockholder Approval, or by Parent due to a terminable breach by the Company, in each case after a Company Acquisition Proposal was made or publicly announced prior to termination and the Company enters into a definitive agreement for or consummates a Company Acquisition Proposal in which any person (a) is issued or sold, or would acquire (pursuant to a merger, or other business combination transaction or series of related transactions involving the Company or a tender offer or exchange offer) beneficial ownership of equity interests representing more than 50% of the voting power of the Company or (b) or would acquire assets of the Company or its subsidiaries representing more than 50% of the Consolidated assets of the Company and its subsidiaries, the within twelve months.

Parent is obligated to pay the Parent Termination Fee if, among other reasons, the Merger Agreement is terminated by the Company (a) due to Parent’s uncured breach of representations, warranties or covenants or (b) because all closing conditions have been satisfied (other than those conditions that by their nature are to be satisfied as of the Closing, but subject to such conditions being able to be satisfied or waived at the Closing), but Parent fails to consummate the Merger within three business days after the Company confirms that the Company is ready, willing and able to consummate the Merger.

For a further discussion of the circumstances under which termination fees are payable, see “The Merger Agreement—Fees and Expenses; Termination Fees” on page 100 of this proxy statement.

Market Prices and Dividend Data (see page 108)

Our Common Stock is listed on Nasdaq under the symbol “DENN.”

On November 3, 2025, the last trading day prior to the public announcement of the execution of the Merger Agreement, the closing price of our Common Stock on Nasdaq was $4.11 per share. On [●], 2026, the latest practicable trading day before the date of this proxy statement, the closing price of our Common Stock on Nasdaq was $[●] per share. You are encouraged to obtain current market prices of our Common Stock in connection with voting your shares.

Under the terms of the Merger Agreement, from the date of the Merger Agreement until the Effective Time, the Company may not declare or pay dividends to the holders of Common Stock without Parent’s written consent.

 

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Delisting and Deregistration of Our Common Stock

As promptly as practicable following the completion of the Merger, our Common Stock will be delisted from Nasdaq and deregistered under the Exchange Act, and we will no longer be required to file periodic reports with the SEC on account of Common Stock. See “The Merger Agreement—Other Agreements” on page 98 of this proxy statement.

 

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QUESTIONS AND ANSWERS ABOUT THE MERGER AND THE SPECIAL MEETING

The following questions and answers are intended to address some commonly asked questions regarding the Special Meeting, the Merger Agreement and the Merger. These questions and answers may not address all questions that may be important to you as a stockholder of Denny’s Corporation. Please refer to the preceding section of this proxy statement entitled “Summary” and the more detailed information contained elsewhere in this proxy statement, its annexes, including the Merger Agreement, and the documents incorporated by reference herein, which you should read carefully and in their entirety.

Q: Why am I receiving these materials?

A: On November 3, 2025, Denny’s Corporation entered into the Merger Agreement, pursuant to which, among other things, Merger Sub will merge with and into Denny’s Corporation, with Denny’s Corporation surviving the Merger and becoming wholly owned, indirect subsidiary of Parent. A copy of the Merger Agreement is attached as Annex A to this proxy statement. The Board is furnishing this proxy statement and form of proxy card to the holders of Common Stock in connection with the solicitation of proxies in favor of the Merger Proposal, the Compensation Advisory Proposal, and the Adjournment Proposal to be voted at the Special Meeting or at any adjournments or postponements thereof.

Q: When and where is the Special Meeting?

A: The Special Meeting will take place on [●], 2026 at [●], Eastern Time, unless the meeting is postponed or adjourned. The Special Meeting will be held in a virtual meeting (audio webcast) format only and will be accessible through the Internet in order to provide expanded access, improved communication and cost savings for our stockholders. You will be able to attend the Special Meeting by visiting [●]. A secure control number that will allow you to participate in the meeting electronically can be found on the enclosed proxy card. For purposes of attendance at the Special Meeting, all references in this proxy statement to “present in person” or “in person” shall mean virtually present at the Special Meeting.

Q: Who is entitled to vote at the Special Meeting?

A: To be able to vote on the matters presented at the Special Meeting, you must have been a stockholder of record at the close of business on [●], 2025, the Record Date for the Special Meeting. The aggregate number of shares of Common Stock entitled to vote at this meeting is [●], which is the number of shares that were outstanding as of the Record Date.

Q: Who is soliciting proxies and who will bear the cost?

A: The Board is soliciting your proxy, and the Company will bear the cost of soliciting proxies. We have engaged the services of Okapi to solicit proxies for the Special Meeting. We have agreed to pay Okapi an initial fee for its proxy solicitation services of $15,000, plus additional fees for consulting and related services and a performance fee payable upon the successful conclusion of the solicitation, plus reimbursement for out-of-pocket expenses. We will also reimburse Okapi for reasonable out-of-pocket expenses and have agreed to indemnify Okapi against certain losses. In addition to solicitation by mail, our directors, officers, and employees may solicit proxies by telephone, internet or otherwise. Our directors, officers and employees will not be additionally compensated for the solicitation, but may be reimbursed for out-of-pocket expenses incurred in connection with the solicitation. Copies of solicitation materials will be furnished to brokerage firms, fiduciaries and other custodians who hold our Common Stock of record for beneficial owners for forwarding to such beneficial owners. We may also reimburse persons representing beneficial owners of our Common Stock for their reasonable expenses incurred in forwarding such materials.

 

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Q: How many votes do I have?

A: Each share of Common Stock that you owned as of the close of business on the Record Date entitles you to one vote on each matter that is voted on at the Special Meeting.

Q: What am I being asked to vote on at the Special Meeting?

A: You are being asked to consider and vote on the following proposals:

 

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to adopt the Merger Agreement (the “Merger Proposal”);

 

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to approve, on a non-binding, advisory basis, certain compensation that may become payable to our named executive officers that is based on or otherwise relates to the Merger (the “Compensation Advisory Proposal”); and

 

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to approve one or more adjournments of the Special Meeting, to a later date or time, if necessary or appropriate, if there are insufficient votes to adopt the Merger Agreement at the time of the Special Meeting (the “Adjournment Proposal”).

Q: What is the proposed Merger and what effects will it have on Denny’s Corporation?

A: The proposed Merger is the acquisition of Denny’s Corporation by Parent pursuant to the Merger Agreement. If the Merger Proposal is approved and the other closing conditions are satisfied or waived, Merger Sub will merge with and into Denny’s Corporation, with Denny’s Corporation continuing as the Surviving Company. As a result, the Company will become wholly owned, indirect subsidiary of Parent. Denny’s Corporation will be delisted from Nasdaq and deregistered under the Exchange Act and will no longer be a publicly traded company required to file periodic reports with the SEC. If the Merger is consummated, you will not own any shares of the common stock of the Surviving Company or of Parent.

Q: What will I receive if the Merger is completed?

A: Upon completion of the Merger, you will be entitled to receive the Merger Consideration of $6.25 in cash, without interest and less any applicable withholding tax, for each share of Common Stock that you own, unless you have properly exercised your appraisal rights under the DGCL. For example, if you own 100 shares of Common Stock, you will be entitled to receive $625.00 in cash (without interest and less any applicable withholding taxes) in exchange for such shares. As a result of the Merger, your shares will be cancelled and you will not own any shares in Denny’s Corporation or the Surviving Company.

Q: What is the position of the Board regarding the Merger?

A: After consulting with its financial advisor and outside legal counsel, the Board unanimously (i) determined that the Merger Agreement and the transactions contemplated thereby are advisable, fair to, and in the best interests of, the Company and its stockholders and declared it advisable for the Company to enter into the Merger Agreement; (ii)approved and declared advisable the execution and delivery by the Company of the Merger Agreement, the performance by the Company of its covenants and agreements contained therein, and the consummation of the Merger and the other transactions contemplated thereby upon the terms and subject to the conditions contained therein; (iii) resolved that the Merger be effected under Section 251 of the DGCL; (iv) directed that the Merger Agreement be submitted to stockholders of the Company for adoption at the Special Meeting; and (v) recommended that the Company’s stockholders adopt the Merger Agreement. The Board recommends that you vote: (i) “FOR” the Merger Proposal; (ii) “FOR” the Compensation Advisory Proposal; and (iii) “FOR” the Adjournment Proposal.

Q: What happens if the Merger is not completed?

A: If the Merger Agreement is not adopted by the stockholders of the Company or if the Merger is not consummated for any other reason, you will not receive any payment for your shares of Common Stock. Instead,

 

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Denny’s Corporation will remain a public company, and Common Stock will continue to be listed and traded on Nasdaq and registered under the Exchange Act, and we will continue to be obligated to file periodic reports with the SEC.

Under specified circumstances, we may be required to pay Parent (or its designee) the Denny’s Termination Fee or may be entitled to receive the Parent Termination Fee upon the termination of the Merger Agreement, as described in “The Merger Agreement—Fees and Expenses; Termination Fees” on page 100 of this proxy statement.

Q: What vote is required to adopt the Merger Agreement?

A: The affirmative vote of the holders of a majority of the shares of Common Stock outstanding as of the Record Date and entitled to vote on the matter is required to approve the Merger Proposal. The failure to vote, an abstention, or a broker non-vote will have the same effect as a vote “AGAINST” the Merger Proposal.

Q: What vote is required to approve the Compensation Advisory Proposal and the Adjournment Proposal?

A: Approval of the Compensation Advisory Proposal and the Adjournment Proposal requires the affirmative vote of a majority of the votes cast at the Special Meeting. A failure to vote, an abstention, or a broker non-vote will have no effect on the outcome of these proposals, assuming a quorum is present.

Q: What happens if stockholders do not approve the Compensation Advisory Proposal?

A: SEC rules require the Company to seek approval on a non-binding, advisory basis with respect to certain payments and benefits that will or may be made or provided to the Company’s named executive officers in connection with the Merger. Approval of the Compensation Advisory Proposal is not a condition to the completion of the Merger. The vote is advisory and will not be binding on the Company or Parent. Accordingly, if the Merger Proposal is approved and the Merger is completed, the Merger-related compensation will be paid to the Company’s named executive officers in accordance with the terms of their compensation agreements and arrangements even if stockholders fail to approve the Compensation Advisory Proposal.

Q: If my broker holds my shares in “street name,” will my broker vote my shares for me?

A: Not without your direction. The proposals in this proxy statement are non-routine matters, and brokers, banks and nominees therefore cannot vote on these proposals without your instructions. It is important that you instruct your broker, bank or nominee on how you wish to vote your shares. A failure to instruct your broker will have the same effect as a vote “AGAINST” the Merger Proposal.

Q: May I revoke my proxy?

A: Yes. If you are a stockholder of record, you may revoke your proxy at any time before it is voted at the Special Meeting by:

 

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completing and returning another proxy card with a later date;

 

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submitting a new proxy via the Internet or telephone;

 

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giving written notice of revocation to the Company’s Secretary at Denny’s Corporation, 203 East Main Street Spartanburg, South Carolina 29319; or

 

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accessing the Special Meeting virtually and voting during the Special Meeting.

If you own shares in “street name,” your bank or broker should provide you with instructions for revoking your vote.

 

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Q: Who can help answer my questions?

A: If you have any questions concerning the Merger or this proxy statement, would like additional copies of this proxy statement or need help voting your shares of Common Stock, please contact Okapi, our proxy solicitor:

Okapi Partners LLC

1212 Avenue of the Americas, 17th Floor

New York, NY 10036

Banks and Brokerage Firms, Please Call: (212) 297-0720

Shareholders and All Others Call Toll-Free: (844) 203-3605

E-mail: [email protected]

 

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CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

The matters discussed in this proxy statement and the accompanying materials include “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Exchange Act, about the plans, strategies, objectives, goals or expectations of Denny’s Corporation. These statements include, but are not limited to, statements about the benefits of the proposed transaction between the Company, Parent and Merger Sub, the expected timing of the completion of the transaction, and other statements that are not historical facts. You can identify forward-looking statements by terminology such as “may,” “will,” “should,” “could,” “expects,” “believes,” “projects,” “forecasts,” “intends,” “plans,” and similar expressions.

These forward-looking statements are based upon current plans, estimates, and expectations that are subject to risks, uncertainties, and assumptions, many of which are beyond the control of the Company and Parent, that could cause actual results to differ materially from those expressed in such statements. Key factors that could cause actual results to differ materially include, but are not limited to the risks detailed in the Company’s filings with the SEC, including in the Company’s most recent filings on Forms 10-K and 10-Q, factors and matters described in this proxy statement, and the following factors:

 

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The risk that the Merger may not be completed in a timely manner or at all, which may adversely affect the businesses and the market price of our Common Stock;

 

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The failure to obtain the required approval of the Company’s stockholders;

 

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The occurrence of any event, change, or other circumstance that could give rise to the termination of the Merger Agreement, including in circumstances that would require the Company or Parent to pay a termination fee;

 

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The effect of the announcement and pendency of the Merger on the Company’s business relationships, operating results, and business generally, including the risk of potential difficulties in employee retention and the risk of disruption to management’s attention from ongoing business operations; and

 

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The risk of litigation related to the Merger.

Additional risks and uncertainties are described in the “Risk Factors” sections of the Company’s most recent Annual Reports on Form 10-K and in subsequent filings with the SEC. The foregoing list of factors is not exhaustive. You should not place undue reliance on any forward-looking statements, which are based only on information currently available to the Company. Denny’s Corporation does not undertake any obligation to update or revise any forward-looking statement, whether as a result of new information, future events, or otherwise, except as required by law.

 

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THE SPECIAL MEETING

The enclosed proxy is solicited on behalf of the Board for use at the Special Meeting or at any adjournments or postponements thereof.

Date, Time and Place

We will hold the Special Meeting on [●], 2026, at [●] Eastern Time, unless the meeting is postponed or adjourned. The Special Meeting will be held in a virtual meeting (audio webcast) format only and will be accessible through the Internet in order to provide expanded access, improved communication and cost savings for our stockholders. To attend the Special Meeting, you must access the meeting website at [●] and provide the control number on your proxy card. For purposes of attendance at the Special Meeting, all references in this proxy statement to “present in person” or “in person” shall mean virtually present at the Special Meeting.

Purpose of the Special Meeting

At the Special Meeting, we will ask our stockholders of record as of the Record Date to consider and vote on the following proposals: (i) the “Merger Proposal”; (ii) the Compensation Advisory Proposal; and (iii) the Adjournment Proposal.

Record Date; Shares Entitled to Vote; Quorum

Only stockholders of record as of the close of business on the Record Date of [●], 2025, are entitled to notice of the Special Meeting and to vote at the Special Meeting or at any adjournments or postponements thereof. Each holder of record of Common Stock on the Record Date will be entitled to one vote for each share of Common Stock held as of the Record Date on each matter submitted to our stockholders for approval. If you sell or transfer your shares of Common Stock after the Record Date but before the Special Meeting, you will transfer the right to receive the Merger Consideration, if the Merger is completed, to the person to whom you sell or transfer your shares, but you will retain your right to vote those shares at the Special Meeting.

As of the Record Date, there were [●] shares of Common Stock outstanding and entitled to be voted at the Special Meeting.

A quorum of stockholders is necessary to hold the Special Meeting. The holders of a majority of the voting power of all of the shares of stock of the Company issued, outstanding and entitled to vote constitute a quorum for the transaction of business at the Special Meeting. As a result, [●] shares must be represented by proxy or by stockholders present and entitled to vote at the Special Meeting to have a quorum. Shares that are voted to abstain on one or more of the proposals will be deemed to be present for quorum purposes. If you hold your shares in “street name” and you fail to provide your broker with instructions on how to vote such shares on any of the proposals, your shares will not be deemed to be present at the Special Meeting for quorum purposes.

In the event that a quorum is not present at the Special Meeting, it is expected that the Special Meeting would be adjourned.

Vote Required; Abstentions and Broker Non-Votes

The affirmative vote of the holders of a majority of the shares of Common Stock outstanding as of the Record Date and entitled to vote on the matter is required to approve the Merger Proposal. Adoption of the Merger Agreement by our stockholders is a condition to the closing of the Merger. A failure to vote your shares of Common Stock, an abstention from voting, or a broker non-vote will have the same effect as a vote “AGAINST” the Merger Proposal.

 

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Approval of each of the Adjournment Proposal and the Compensation Advisory Proposal requires the affirmative vote of a majority of the votes cast at the Special Meeting. Assuming a quorum is present, a failure to vote, a broker non-vote, or an abstention will have no effect on the outcome of the Adjournment Proposal or the Compensation Advisory Proposal.

Because the vote on the Compensation Advisory Proposal is only advisory in nature, it will not be binding on the Company or the Board. Accordingly, because the Company is contractually obligated to pay the compensation, such compensation will be paid or become payable, subject only to the conditions applicable thereto, if the Merger is consummated and regardless of the outcome of the vote.

Stock Ownership and Interests of Certain Persons

As of the Record Date, our directors and executive officers beneficially owned and were entitled to vote an aggregate of [●] shares of Common Stock, representing approximately [●]% of the outstanding shares of Common Stock. Our directors and executive officers have informed us that they currently intend to vote all of their shares of Common Stock: (i) “FOR” the Merger Proposal; (ii) “FOR” the Compensation Advisory Proposal; and (iii) “FOR” the Adjournment Proposal.

Voting of Proxies

If your shares of Common Stock are registered in your name with our transfer agent, you may cause your shares to be voted at the Special Meeting by submitting your proxy or by voting in person. If you submit a proxy, the proxy holders will vote your shares of Common Stock according to your directions.

Voting instructions are included on your proxy card. All shares of Common Stock represented by properly executed proxies received in time for the Special Meeting will be voted at the Special Meeting in accordance with the instructions of the stockholder. Properly executed proxies that do not contain voting instructions will be voted (i) “FOR” the Merger Proposal; (ii) “FOR” the Adjournment Proposal; and (iii) “FOR” the Compensation Advisory Proposal.

If your shares of Common Stock are held in “street name” through a broker, bank or other nominee, you may provide voting instructions through your broker by completing and returning the voting instruction form provided. Because all of the proposals to be voted on at the Special Meeting are non-routine matters, your broker will not be able to vote your uninstructed shares on any of the proposals. A failure to instruct your broker will have the same effect as if you voted “AGAINST” the Merger Proposal, but will have no effect on the other proposals.

Revocability of Proxies

If you are a stockholder of record, you may revoke your proxy at any time before it is voted at the Special Meeting by:

 

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submitting a new proxy by Internet or telephone as instructed on your proxy card before 11:59 p.m., Eastern Time on [●], 2026, the day before the Special Meeting;

 

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delivering a written notice of revocation to Denny’s Corporation, 203 East Main Street Spartanburg, South Carolina 29319, Attention: Secretary;

 

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signing another proxy card with a later date and returning it to us before the Special Meeting; or

 

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accessing the Special Meeting virtually and voting during the Special Meeting.

If you hold your shares of Common Stock in “street name,” you should contact your broker for instructions regarding how to revoke your voting instructions.

 

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Denny’s Corporation Board of Directors’ Recommendation

The Board, after considering various factors, unanimously: (i) determined that the Merger Agreement and the transactions contemplated thereby, including the Merger, are advisable, fair to, and in the best interests of, the Company and its stockholders, and declared it advisable for the Company to enter into the Merger Agreement; (ii) approved and declared advisable the execution and delivery by the Company of the Merger Agreement, the performance by the Company of its covenants and agreements contained therein, and the consummation of the Merger and the other transactions contemplated by the Merger Agreement upon the terms and subject to the conditions contained therein; (iii) resolved that the Merger be effected under Section 251 of the DGCL; (iv) directed that the Merger Agreement be submitted to the stockholders of the Company for adoption at the Special Meeting; and (iv) recommended that the Company’s stockholders adopt the Merger Agreement.

The Board recommends that you vote: (i) “FOR” the Merger Proposal; (ii) “FOR” the Compensation Advisory Proposal; and (iii) “FOR” the Adjournment Proposal.

Expenses of Proxy Solicitation

This proxy statement is being furnished in connection with the solicitation of proxies by the Board. Expenses incurred in connection with the printing and mailing of this proxy statement are our responsibility. We have agreed to pay Okapi an initial fee for its proxy solicitation services of $15,000, plus additional fees for consulting and related services and a performance fee payable upon the successful conclusion of the solicitation, plus reimbursement for out-of-pocket expenses. We may also reimburse persons representing beneficial owners for their costs of forwarding solicitation materials. In addition to the solicitation of proxies by mail, proxies may be solicited by our directors, officers and employees in person or by telephone or other means of communication. No additional compensation will be paid to our directors, officers or employees for their services in connection with the solicitation, but they may be reimbursed for reasonable out-of-pocket expenses.

Anticipated Date of Completion of the Merger

Assuming timely satisfaction of necessary closing conditions, including the approval of the Merger Proposal by our stockholders, we anticipate that the Merger will be consummated during the first quarter of 2026.

Other Matters

At this time, we know of no other matters to be submitted at the Special Meeting.

Important Notice Regarding the Availability of Proxy Materials for the Special Meeting

This proxy statement is available on our investor relations website at www.dennys.com.

Householding of Special Meeting Materials

The SEC permits companies and intermediaries (e.g., brokers) to satisfy the delivery requirements for proxy materials with respect to two or more stockholders sharing the same address by delivering a single proxy statement addressed to those stockholders. This process, which is commonly referred to as “householding,” potentially means extra convenience for stockholders and cost savings for companies. Stockholders who hold their shares through a nominee, such as a broker, bank, broker-dealer or similar organization may receive notice from that nominee regarding the householding of proxy materials. As indicated in the notice, a single proxy statement will be delivered to multiple stockholders sharing an address unless contrary instructions have been received from an affected stockholder. Once a stockholder has received notice that a nominee will be householding, such householding will continue until the stockholder is notified otherwise or until the stockholder has revoked consent by notifying the nominee. If you hold your shares in “street name” and would prefer to

 

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receive separate copies of a proxy statement for other stockholders in your household, either now or in the future, please contact your nominee. If you are record holder of your shares and would prefer to receive separate copies of a proxy statement for other stockholders in your household, either now or in the future, please contact: Denny’s Corporation, 203 East Main Street Spartanburg, South Carolina 29319, Attention: Secretary. Stockholders who currently receive multiple copies of the proxy statement at their addresses and would like to request “householding” of their communications should contact their broker or the Company, as applicable.

Rights of Stockholders Who Assert Appraisal Rights

Record holders and beneficial owners of shares of Common Stock who have not voted in favor of the Merger and who have properly demanded appraisal for such shares in accordance with Section 262 of the DGCL will be entitled to statutory appraisal rights. This means that such stockholders are entitled to seek appraisal of their Dissenting Shares and, if all requirements of Section 262 of the DGCL are met, to receive payment in cash for the “fair value” of such shares, as determined by the Delaware Court of Chancery. For a description of these appraisal rights, stockholders should consult Section 262 of the DGCL, which can be accessed without subscription or cost at the following publicly available website: https://delcode.delaware.gov/title8/c001/sc09/index.html#262.

Questions and Additional Information

If you have more questions about the Merger or how to submit your proxy, or if you need additional copies of this proxy statement or the enclosed proxy card, please contact our proxy solicitor:

Okapi Partners LLC

1212 Avenue of the Americas, 17th Floor

New York, NY 10036

Banks and Brokerage Firms, Please Call: (212) 297-0720

Shareholders and All Others Call Toll-Free: (844) 203-3605

E-mail: [email protected]

 

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THE MERGER

This discussion of the Merger is qualified in its entirety by reference to the Merger Agreement, which is attached as Annex A to, and incorporated by reference into, this proxy statement. You should read the Merger Agreement carefully and in its entirety as it is the legal document that governs the Merger.

Parties Involved in the Merger

Denny’s Corporation

203 East Main Street

Spartanburg, South Carolina 29319

Denny’s Corporation is a Delaware-based company operating two restaurant brands, Denny’s and Keke’s Breakfast Cafe, with a total of 1,568 restaurants as of December 25, 2024—1,493 franchised or licensed and 75 company-operated. Denny’s, known for its 24/7 service and all-day breakfast menu, accounted for 1,499 locations, 96% of which were franchised or licensed, including 165 international units. Keke’s, acquired in 2022, is a daytime eatery focused on made-to-order breakfast and lunch, with 69 U.S. locations, 80% of which are franchised.

Denny’s Corporation Common Stock is listed under the symbol “DENN” on Nasdaq.

Sparkle Topco Corp.

445 Park Avenue, 17^th Floor

New York, NY 10022

Sparkle Topco Corp. is a Delaware corporation that was formed on October 30, 2025 solely for the purpose of engaging in the transactions contemplated by the Merger Agreement, and has not engaged in any activities other than in connection with or as contemplated by the Merger Agreement. Sparkle Topco Corp. is controlled by funds managed by affiliates of TriArtisan Capital Advisors LLC.

Upon consummation of the Merger in accordance with the Merger Agreement, Parent will be the parent company of Denny’s Corporation.

Sparkle Acquisition Corp.

445 Park Avenue, 17^th Floor

New York, NY 10022

Merger Sub is a Delaware corporation that was formed solely for the purpose of engaging in the transactions contemplated by the Merger Agreement, and has not engaged in any activities other than in connection with or as contemplated by the Merger Agreement. Merger Sub is a wholly owned, indirect subsidiary of Parent that was incorporated on October 30, 2025. Upon consummation of the Merger, Merger Sub will cease to exist, and Denny’s Corporation will survive the Merger as a wholly owned, indirect subsidiary of Parent.

TriArtisan Capital Advisors LLC

445 Park Avenue, 17^th Floor

New York, NY 10022

TriArtisan Capital Advisors LLC invests and manages private equity capital provided by a broad roster of institutions including sovereign wealth funds, alternative asset managers, and family offices, and targets investments in companies with EBITDA of $25-300 million across multiple industries including Retail / Consumer, Business and Professional Services, Industrial, Media and Healthcare.

 

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Certain Effects of the Merger

Upon the terms and subject to the conditions of the Merger Agreement, at the Effective Time, Merger Sub will merge with and into the Company, with the Company continuing as the Surviving Company and, as a result of the Merger, the separate corporate existence of Merger Sub will cease, and the Company will continue as a wholly owned, indirect subsidiary of Parent. The Company and all shares of Common Stock will be delisted from Nasdaq and all shares of Common Stock will be deregistered under the Exchange Act as soon as reasonably practicable following the Effective Time, and at such time, we will cease to be a publicly traded company and will no longer be obligated to file periodic reports with the SEC. If the Merger is completed, you will not own any shares of the common stock of the Surviving Company, and instead will only be entitled to receive the Merger Consideration (unless you are entitled to and have properly demanded appraisal for your shares in accordance with Section 262 of the DGCL, in which case your shares will be cancelled and cease to exist and you will be entitled to the rights granted under Section 262 of the DGCL).

The Effective Time will occur upon the filing of a certificate of merger with the Secretary of State of the State of Delaware (or at such later date and time as the Company, Parent and Merger Sub may agree and specify in the certificate of merger).

Effect on the Company if the Merger is Not Completed

If the Merger Proposal is not approved by the stockholders of Denny’s Corporation or if the Merger is not completed for any other reason, you will not receive any payment for your shares of Common Stock. Instead, we will remain a public company, and Common Stock will continue to be listed and traded on Nasdaq and registered under the Exchange Act, and we will continue to be obligated to file periodic reports with the SEC.

Furthermore, depending on the circumstances that would have caused the Merger not to be completed, it is possible that the price of Common Stock will decline significantly. If that were to occur, it is uncertain when, if ever, the price of Common Stock would return to the price at which it trades as of the date of this proxy statement.

Accordingly, if the Merger is not completed, there can be no assurance as to the effect of these risks and opportunities on the future value of your shares of Common Stock. If the Merger is not consummated, the Board will continue to evaluate and review our business operations, properties and capitalization, among other things, make such changes as are deemed appropriate and continue to seek to enhance stockholder value. If the Merger Proposal is not approved by the stockholders of Denny’s Corporation or if the Merger is not completed for any other reason, there can be no assurance that any other transaction acceptable to the Board will be offered or that our business, prospects or results of operation will not be adversely impacted.

In addition, under specified circumstances, we may be required to pay the Denny’s Termination Fee to Parent (or its designee) or may be entitled to receive the Parent Termination Fee from Parent upon the termination of the Merger Agreement, as described under “The Merger Agreement—Fees and Expenses; Termination Fees” on page 100 of this proxy statement.

Merger Consideration

At the Effective Time, each outstanding share of Common Stock (other than (i) Cancelled Shares and (ii) Dissenting Shares) will be converted automatically into the right to receive the Merger Consideration, without interest and less any applicable withholding taxes. All shares of Common Stock converted into the right to receive the Merger Consideration will automatically be cancelled and cease to exist at the Effective Time, and each certificate formerly representing such shares will thereafter represent only the right to receive the Merger Consideration, except for certificates representing any Dissenting Shares, which shall represent the right to receive payment of the fair value of such shares of Common Stock in accordance with and to the extent provided by Section 262 of the DGCL, or any Cancelled Shares.

 

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After the completion of the Merger, under the terms of the Merger Agreement, you will have the right to receive the Merger Consideration, but you will no longer have any rights as a Denny’s Corporation stockholder (except that stockholders who hold Dissenting Shares will not have the right to receive the Merger Consideration but will instead have the right to receive a payment for the “fair value” of their Dissenting Shares as determined by the Delaware Court of Chancery pursuant to an appraisal proceeding as contemplated by Delaware law, as described in “The Merger—Appraisal Rights” on page 63 of this proxy statement).

Following completion of the Merger, Denny’s Corporation will cease to be a publicly traded company and will become a wholly-owned subsidiary of Parent.

The Merger Consideration will be adjusted appropriately and equitably to reflect the effect of any reclassification, recapitalization, stock split (including a reverse stock split), or subdivision or combination, exchange or readjustment of shares, or any stock dividend or stock distribution thereon (including any dividend or other distribution of securities convertible into Common Stock), with respect to outstanding shares of capital stock of Denny’s Corporation, with a record date between the date of the Merger Agreement and the Effective Time, to provide to the holders of shares of capital stock of Denny’s Corporation the same economic effect as contemplated by the Merger Agreement prior to such event.

Background of the Merger

The following chronology summarizes certain key meetings and events that led to the signing of the Merger Agreement. The following chronology does not purport to catalogue every conversation among the Board or the representatives of the Company, Parent, its affiliates and other parties.

As part of the Company’s ongoing consideration and evaluation of its long-term strategic goals and plans, the Board and management of the Company periodically review, consider and assess the Company’s operations and financial performance and overall industry and macroeconomic conditions, as they may affect those strategic goals and plans, with the goal of enhancing stockholder value. This review at times includes, among other things, the consideration of potential opportunities for strategic transactions, business combinations, acquisitions and other financial and strategic alternatives.

On April 10, 2024, at a dinner during the Allied Partner Summit hosted by the Denny’s Franchise Association (the “DFA”), Anil Yadav, the CEO and President of Yadav Enterprises, Inc. (“Yadav Enterprises”), a restaurant franchisee company with over 300 restaurants covering multiple brands, including approximately 70 Denny’s franchises, mentioned to Robert P. Verostek, the Company’s Chief Financial Officer, that Yadav Enterprises and several other parties might have an interest in acquiring the Company. Mr. Verostek informed the other members of the Company’s management team of this conversation, and management later informed the Board of this conversation on or around April 26, 2024, when the Board’s Audit Committee held a meeting.

On July 17, 2024, during the Franchise Owners Summit hosted by the DFA, Mr. Yadav informed Mr. Verostek that a letter would be forthcoming conveying an offer to acquire the Company.

On July 18, 2024, later during the Franchise Owners Summit, representatives of Yadav Enterprises requested a meeting with Company management to discuss their potential interest in acquiring the Company. The requested meeting took place that day and was attended by Mr. Yadav and on behalf of the Company by Kelli F. Valade, the Company’s President and Chief Executive Officer, and Mr. Verostek. At the meeting, the representatives of Yadav Enterprises reiterated their interest in acquiring the Company.

Later on July 18, 2024, following the meeting, the Company received an unsolicited non-binding indication of interest from Yadav Enterprises and TriArtisan Capital Advisors LLC (in this Background section, “TriArtisan”), a private equity firm with, at the time, several existing restaurant holdings, including PF Chang’s, TGI Friday’s and Hooters (the “July 18, 2024 IOI”), that contemplated those entities acquiring the Company for

 

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approximately $470 million, or $9.00 per share, subject to completion of due diligence and the negotiation of a definitive agreement. The July 18, 2024 IOI stated that the proposed acquisition would be on a cash-free, debt-free basis, free and clear of all liens and encumbrances, and assumed that the Company would be delivered with sufficient working capital to operate the business in the normal course. It stated further that the proposed acquisition would be funded with cash on hand from Yadav Enterprises, TriArtisan’s sources of equity capital, senior secured debt financing, including the Company’s current assumable debt, as well as with financing to be obtained from other sources.

The following Monday, July 22, 2024, management of the Company distributed the July 18, 2024 IOI to the Board.

On July 29, 2024, the Company replied to Yadav Enterprises and TriArtisan, acknowledging receipt of the July 18, 2024 IOI, and indicating that the Board would be discussing the letter at a meeting in the near future, after which the Company would provide a more fulsome response to Yadav Enterprises and TriArtisan.

On August 2, 2024, the Board held a special virtual meeting, also attended by members of management, at which it discussed the July 18, 2024 IOI. The Board directed management to contact representatives of Truist Securities (“Truist Securities”), who had previously served as financial advisors to the Company when affiliated with a different investment bank, and were familiar with the Company as well as with the restaurant industry. Management contacted Truist Securities on August 2, 2024 to discuss the July 18, 2024 IOI, as well as Truist Securities’ views on the Company, the full-service restaurant industry, TriArtisan, Yadav Enterprises and related matters. Truist Securities provided information regarding these matters and held discussions with Company management on August 6, 2024.

On August 7, 2024, the Board held a special virtual meeting, also attended by certain of the Company’s senior officers and representatives of Truist Securities, at which it discussed the July 18, 2024 IOI, as well as certain potential stockholder activism suggested by communications recently received by the Company from certain other entities, including franchisees of the Company as well as outside investment firms, regarding the operations of the Company and the Denny’s restaurants, as well as Company corporate governance matters.

On August 15, 2024, the Board held a special virtual meeting, also attended by certain of the Company’s senior officers and representatives of Truist Securities and Morgan, Lewis & Bockius LLP (“Morgan Lewis”), the Company’s corporate counsel. At the meeting, the Board discussed matters relating to the Company’s current five-year financial model, covering the years 2024-2028, as prepared by management, and the actions of Yadav Enterprises and TriArtisan and potential next steps with respect thereto. The Board also received an update from Truist Securities regarding the current state of market valuations for restaurant companies, as well as advice regarding processes for undertaking a market check to get a sense of the market’s valuation of the Company. The Board and management discussed various potential operational initiatives, as well as strategic and financial options potentially available to the Company in light of the interest expressed by Yadav Enterprises and TriArtisan, and also discussed the communications received from certain company stockholders regarding operational and corporate governance matters. The Board directed management to continue to refrain from responding to Yadav Enterprises and TriArtisan unless and until being contacted again, and also directed management to prepare, for discussion at the scheduled in-person Board meeting to be held on August 27 and 28, 2024, an updated five-year financial model, as well as recommendations for potential plans and actions to be taken in light of the communications regarding operational and corporate governance matters that were discussed at the meeting.

On August 23, 2024, the Company received a revised unsolicited non-binding indication of interest from TriArtisan (the “August 23, 2024 IOI”). Yadav Enterprises was not a party to this indication of interest. The August 23, 2024 IOI contemplated TriArtisan acquiring the Company for a reduced price of approximately $420 million, or $8.25 per share, while otherwise substantially repeating the elements of the July 18, 2024 IOI, other than stating that the proposed acquisition would be funded with cash on hand from TriArtisan’s sources of equity capital, senior secured debt financing, including the Company’s current assumable debt, as well as with financing to be obtained from other sources. 

 

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On August 26, 2024, management of the Company distributed the August 23, 2024 IOI to the members of the Board. Later that day, at a dinner prior to a regularly scheduled August 27 and 28, 2024 in-person Board meeting, representatives of Truist Securities and Morgan Lewis presented to the Board and members of senior management regarding various matters raised by and relating to the August 23, 2024 IOI. Among other things, the Board and its advisors discussed proposed responses to TriArtisan, potential processes and methodologies for assessing the attractiveness of the offer in the context of the potential value of the Company, and the Board’s fiduciary obligations in relation to such considerations. A representative of Morgan Lewis reviewed with the Board the legal and process considerations in connection with a potential change of control transaction involving the Company and the directors’ fiduciary duties under Delaware law when considering any such change in control transaction, evaluating next steps in connection with the indications of interest from TriArtisan and a review of other potential strategic alternatives, including remaining a standalone public company. The Morgan Lewis representative also discussed with the Board the need to be cognizant of any conflicts of interest and the need to be alert for any interest of any director or officer in a potential transaction that differed from the Company’s other stockholders. The representatives of Truist Securities and Morgan Lewis also joined a portion of the meeting on August 28, 2024 to discuss the same topics, as well as a response to TriArtisan.

On August 27, 2024, during the meeting, Company management reviewed with the Board a draft of certain financial projections of the Company prepared by management for fiscal years 2024 to 2028 (the “August 27 Draft Financial Projections”), and summarized for the Board the assumptions used in management’s preparation of the August 27 Draft Financial Projections. Management and the Board also discussed various operational and financial initiatives and plans for the Company going forward.

On August 28, 2024, following the conclusion of the Board meeting and at the direction of the Board, the Company responded to TriArtisan by letter, indicating that the Board had unanimously determined not to pursue the proposed transaction at the present time.

Over the next several days, through September 9, 2024, members of Company management and representatives of Truist Securities engaged in informal discussions regarding the Company and the full-service restaurant industry, as well as mechanisms for gauging potential third party interest in the Company in light of the TriArtisan indication of interest.

On or around September 10, 2024, in order to facilitate the Board’s consideration of a possible transaction or transactions involving the Company, including the evaluation of potential transactions and alternatives thereto, the Board formed an ad hoc committee (the “2024 Transaction Committee”) consisting of three independent directors. The 2024 Transaction Committee was asked to, among other things, consider, and then report to the Board regarding, certain matters relating to potential strategic transactions and related matters.

Beginning in mid-September 2024, at the Company’s request, Truist Securities contacted 26 private equity firms that were identified by Truist Securities to the Company as being the most likely potential candidates for a strategic transaction with the Company. In identifying these parties, consideration was given to various factors, including the parties’ financial resources and their experience with companies in the restaurant space. These parties were provided with a basic overview of the Company and informed that if they entered into a non-disclosure agreement they would receive packages containing non-public financial and operating information regarding the Company. A total of ten parties entered into non-disclosure agreements with the Company, each of which contained a standstill provision that included a “don’t ask, don’t waive” provision, and were thereafter provided with a confidential information presentation regarding the Company.

Between mid-September and early October 2024, representatives of Truist Securities worked with the Company to prepare and populate a virtual data room to house due diligence materials regarding the Company, which data room was opened on October 2, 2024 to those third parties who signed non-disclosure agreements.

 

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On October 7, 2024, the Company formalized its engagement with Truist Securities by entering into an engagement letter for Truist Securities to serve as the Company’s exclusive financial advisor for the purpose of assisting the Board of Directors of the Company in its analysis and consideration of a sale transaction.

Over the next several weeks, several of the third parties that had executed non-disclosure agreements engaged in due diligence activities.

On October 29, 2024, one of the private equity firms that had executed a non-disclosure agreement (“Party A”) submitted to Truist Securities a letter containing a non-binding indication of interest with a preliminary price per share of $8.00 to $9.00, subject to confirmatory due diligence.

On October 30, 2024, another such private equity firm (“Party B”) verbally conveyed to Truist Securities a non-binding indication of interest to acquire the Company with a preliminary price per share of $7.00 to $8.00, subject to confirmatory due diligence. Based on Party B’s proposed range, the Company determined not to further pursue discussions with Party B. Party A conducted additional due diligence on the Company over the following weeks.

On November 1, 2024, in advance of the Board’s regularly scheduled meeting to be held the following week, the 2024 Transaction Committee held a virtual meeting, with certain of the Company’s senior officers and representatives of Truist Securities and Morgan Lewis participating. At the meeting, management updated the Committee on reactions to the Company’s investor day held on October 22, 2024 and the financial model shared in that meeting. The representatives of Truist Securities shared with the Committee the results thus far of the process of contacting potential interested third parties. The Committee discussed the interest expressed in the Company in light of the Board’s and management’s views on operational opportunities and challenges facing the Company.

On November 5, 2024, the Board held a regularly scheduled in-person meeting, with certain of the Company’s senior officers and representatives of Truist Securities and Morgan Lewis participating, at which it discussed numerous matters, including the matters discussed at the November 1 meeting of the 2024 Transaction Committee. Representatives of Truist Securities reviewed with the Board an update on the market check as well as Truist Securities’ preliminary financial analyses of the Company, including certain financial analyses based on a five-year financial model provided by Company management, which had been updated and refined by Company management following the August Board meeting to, among other things, add fiscal year 2029 to the projection period and to reflect increased EBITDA expectations and reduced free cash flow generation over the projection period due to higher expected capital expenditures.

On November 20, 2024, a slightly modified five-year financial model was provided by Company management to the Board, with the modifications reflecting edits to the forecasts for 2024 and 2025.

On November 26, 2024, the Board held a special virtual meeting, with certain of the Company’s senior officers and representatives of Truist Securities and Morgan Lewis participating, at which the Board received an update regarding the discussions with Party A.

On December 11, 2024, senior members of Company management hosted a virtual management meeting with representatives of Party A.

On December 17, 2024, Party A indicated to Truist Securities that it was not interested in further pursuing a potential acquisition of the Company.

On April 1, 2025, Mr. Yadav contacted Ms. Valade and sent her a new unsolicited indication of interest from TriArtisan, dated April 2, 2025 (the “April 2, 2025 IOI”) that contemplated TriArtisan acquiring the Company for approximately $310 million, or $6.00 per share. The April 2, 2025 IOI stated that the proposed

 

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acquisition would be on a cash-free, debt-free basis, free and clear of all liens and encumbrances, and assumed that the Company would be delivered with sufficient working capital to operate the business in the normal course. It stated further that the proposed acquisition would be funded with TriArtisan’s sources of equity capital, debt financing, including the Company’s current assumable debt, as well as with financing to be obtained from other sources.

On April 9, 2025, the Board held a special virtual meeting, with certain of the Company’s senior officers and representatives of Truist Securities and Morgan Lewis participating, to discuss the April 2, 2025 IOI. As part of the discussion, the representatives of Truist Securities summarized the outreach process conducted in the fall of 2024. They then discussed a proposed outreach approach to potential buyers in light of the April 2, 2025 IOI, which would include engaging with TriArtisan, as well as reaching out to the ten parties contacted in the Fall 2024 process who had executed NDAs, two parties contacted in the Fall 2024 process who had declined to execute NDAs but which Truist Securities believed might have potential interest in a transaction, and 16 additional potential buyers, including a strategic buyer. They also discussed an illustrative timeline for a transaction.

Beginning on April 10, 2025, representatives of Truist Securities worked with the Company to update the virtual data room that had been utilized in the Fall 2024 process, as well as to update the confidential information presentation regarding the Company that had been provided to potential bidders in the Fall 2024 process.

During April 2025, as it had described to the Board at the April 9, 2025 meeting, representatives of Truist Securities contacted 28 other third parties, including the ten parties contacted in the Fall 2024 process who had executed NDAs. Of these parties, 19 entered into non-disclosure agreements containing certain customary non-solicit and standstill provisions that included “don’t ask, don’t waive” provisions.

In mid-April, representatives of Truist Securities engaged with representatives of TriArtisan to discuss certain aspects of the proposed transaction. During these discussions, TriArtisan indicated that given the expected size of a potential transaction, it would need to bring other partners into the transaction, including Yadav Enterprises.

On April 21, 2025, the Company entered into non-disclosure agreements, which contained certain customary non-solicit and standstill provisions that included “don’t ask, don’t waive” provisions, with TriArtisan and Yadav Enterprises.

On April 23, 2025, the Company supplied Truist Securities, for posting in the virtual data room, its current five-year financial model, which model was approved by the Company’s Audit Committee at its meeting on April 24, 2025.

On May 13 and 14, 2025, the Board held a regularly scheduled in-person meeting, with certain of the Company’s senior officers and representatives of Truist Securities and Morgan Lewis participating, at which it discussed various matters, including receiving updates from management on the status of the business and certain operational and financial matters. Management also provided an update on the status of discussions of TriArtisan and Yadav Enterprises, as well as the outreach to other potentially interested parties. Representatives of Truist Securities indicated that outreach was conducted by management and Truist Securities to 28 potential third-party buyers (as well as TriArtisan and Yadav Enterprises), after which calls were scheduled with seven. The potential third-party buyers included one potential strategic buyer, a public company, which indicated that it was not currently interested in pursuing a transaction with the Company. The Truist Securities representatives indicated that Truist Securities anticipated preliminary indications of interest would be submitted by June 4, 2025. A representative of Morgan Lewis reviewed with the Board the legal and process considerations in connection with a potential change of control transaction involving the Company and the directors’ fiduciary duties under Delaware law when considering any such change in control transaction, including the Board’s duty to obtain the highest value reasonably attainable for the benefit of the Company’s stockholders in such a transaction. The Board also received advice from representatives of Sidley & Austin LLP (“Sidley”), which had recently

 

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represented the Company in connection with an unsuccessful attempt by a stockholder to nominate a director for election at the Company’s 2025 Annual Meeting of Stockholders, regarding best practices for dealing with activist stockholders.

During April and May 2025, members of management, with the assistance of Truist Securities, engaged in discussions with the parties that had entered into NDAs, and such parties engaged in due diligence activities.

On June 4, 2025, Truist Securities received a revised non-binding indication of interest from TriArtisan (the “June 4, 2025 IOI”), as well as a non-binding indication of interest from a private equity firm contacted by Truist Securities in its outreach process, “Party C.”

TriArtisan’s June 4, 2025 IOI continued to propose a purchase price of $6.00 per share, on substantially the same basis and subject to the same conditions as set forth in its April 2, 2025 IOI. Party C’s indication of interest proposed a price per share in a range from $4.65 to $5.45 to acquire the Company on a cash-free and debt-free basis, subject to confirmatory business, accounting, tax, benefits, insurance, environmental and legal due diligence, and subject to Party C obtaining market-based financing.

On June 12, 2025, Truist Securities received a non-binding indication of interest from another private equity firm contacted by Truist Securities in its outreach process, “Party D.” Party D’s indication of interest proposed a price per share in a range from $5.50 to $6.00, subject to confirmatory business and legal due diligence with certain specific focus areas for the business diligence. It stated further that the proposed acquisition would be funded with equity capital from Party D’s various funds and co-investment vehicles and debt financing either in the form of a securitization facility or a traditional term loan.

On June 12, 2025, the Board held a special virtual meeting, with certain of the Company’s senior officers and representatives of Truist Securities and Morgan Lewis participating, to discuss the offers received from TriArtisan, Party C and Party D. Truist Securities noted that all other parties contacted, including those who had entered into non-disclosure agreements, had declined to proceed. The Board discussed the offers and determined that the range proposed by Party C was insufficient, and that Party C’s offer should not be pursued. The Board directed Truist Securities to invite TriArtisan and Party D to conduct additional due diligence, with guidance that they would have to raise their proposed price in order for the Company to move forward toward a transaction. Members of management also discussed with the Board efforts that had been taken with respect to a potential securitization transaction by the Company, including engaging with investment banking and legal advisors, and potential next steps, including an upcoming meeting by management with representatives of credit rating agencies.

Through the remainder of June 2025, both TriArtisan and Party D conducted additional due diligence on the Company.

On June 30, 2025, Truist Securities received and forwarded to the Company a revised non-binding indication of interest from TriArtisan (the “June 30, 2025 IOI”). The June 30, 2025 IOI proposed an increased purchase price of $6.25 per share, on substantially the same basis and subject to the same conditions as set forth in its June 12, 2025 IOI, and described the following committed financing arrangements to which it was subject: (i) $200 million in sale/leaseback financing on all Company-owned real estate properties; (ii) $225 million in debt financing, to be provided either by the Company’s existing lenders or third-party debt sources, subject to customary terms; and (iii) $200 million in equity financing from TriArtisan-affiliated equity sources. TriArtisan did not include with its offer, as it had been requested to do, support letters from its equity financing sources.

On July 1, 2025, Truist Securities received and forwarded to the Company a revised non-binding indication of interest from Party D. Party D’s revised indication of interest proposed a price per share of $5.50, which was at the low end of its previously suggested range. Party D indicated that its offer was subject to confirmatory business and legal due diligence with certain specific focus areas for the business diligence, and that the proposed

 

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acquisition would be funded with equity capital from Party D’s various funds and co-investment vehicles and debt financing (with respect to which it submitted a highly confident letter in customary form) utilizing a loan facility to bridge to both senior term and variable securitization notes, as well as junior notes, if necessary.

On July 2, 2025, the Board held a special virtual meeting, with certain of the Company’s senior officers and representatives of Truist Securities and Morgan Lewis participating, to discuss the revised offers received from TriArtisan and Party D. Members of management provided an update on the current state of the Company’s business. They then provided the Board with an update on the Company’s internal valuation and current outlook for the business, views of securities analysts on the Company and its valuation, and the state of the full service dining industry. They also discussed the Company’s five-year financial model. Representatives of Truist Securities reviewed with the Board Truist Securities’ updated preliminary financial analyses of the Company. A representative of Morgan Lewis reviewed with the Board the legal and process considerations in connection with a potential change of control transaction involving the Company and the directors’ fiduciary duties under Delaware law when considering any such change in control transaction. The Board then discussed potential next steps in connection with the indications of interest from TriArtisan and Party D and a review of other potential strategic alternatives, including remaining a standalone public company. Representatives of Truist Securities noted that both TriArtisan and Party D had requested a period of exclusivity through early to mid-August. During the discussion, the members of management present conveyed their recommendation to the Board that the Company pursue a sale, whether to TriArtisan or to Party D, at a price per share above $6.00. The Board then conducted an executive session, during which the members of the Board unanimously determined to accept management’s recommendation.

Following the meeting, the Company instructed Truist Securities to interact with Party D and with TriArtisan, with the goals of focusing on having Party D increase its offer price to at least $6.00 following further due diligence, and of having TriArtisan provide support letters from its proposed equity financing sources. Over the next two weeks, Truist Securities engaged in this effort.

Despite these efforts, Party D remained unwilling to increase its per share offer price above $5.50. On July 15, 2025, TriArtisan provided a letter to Truist Securities (dated July 14, 2025) confirming its offer price of $6.25 per share, and also provided equity support letters from Yadav Enterprises as well as from an alternate source of equity financing. TriArtisan also noted that they expected several other of their key investors to participate in the committed equity for the transaction.

On July 22, 2025, the Board held a special virtual meeting, with certain of the Company’s senior officers and representatives of Truist Securities and Morgan Lewis participating, to discuss the status of the discussions with TriArtisan and Party D, as well as to provide an update on the status of the Company’s efforts to prepare for the potential securitization transaction previously discussed with the Board and perspective on how the process and timeline for continuing to pursue the securitization would be impacted by a continued sale process. Members of management provided an update on the current state of the Company’s business, and then discussed the interactions since the July 2, 2025 meeting with TriArtisan and Party D, noting that Party D was unwilling to increase its purchase price and the receipt of the support letter from TriArtisan. Representatives of Truist Securities then reviewed the status of discussions with TriArtisan and Party D, and discussed a potential timeline for a transaction.

Following the meeting, at the instruction of the Board, the Company instructed its advisors to inform TriArtisan that it would accept the proposed $6.25 per share offer price, and to work towards preparing definitive transaction documents while the Board also continued to consider in parallel a potential securitization transaction and otherwise remaining a standalone company.

On July 30, 2025, Ms. Valade, Mr. Verostek and a representative of Truist Securities met in person with representatives of TriArtisan. Representatives of Yadav Enterprises, including Mr. Yadav, and of the alternate

 

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source of equity financing that had provided the July 14 equity support letter, participated in the meeting remotely. The participants in the meeting discussed the Company’s business, the restaurant industry, potential plans for the Company’s real estate, and other related matters.

On August 7, 2025, the Board held a special virtual meeting, with certain of the Company’s senior officers and representatives of Truist Securities and Morgan Lewis participating, to discuss the status of the discussions with TriArtisan. Members of management provided an update on the discussions with TriArtisan, as well as on the Company’s business and the casual dining sector and the reaction of the market to the Company’s recent second quarter earnings call. Representatives of Truist Securities updated the Board on conversations with TriArtisan and its progress with its financing, noting that TriArtisan was planning to engage in conversations with several direct lending sources regarding providing the debt financing for the transaction. The representatives of Truist Securities indicated that they expected to receive a letter from TriArtisan later in the day affirming its offer price of $6.25 per share, and providing further detail regarding its financing structure. Members of management provided an update on the status of the Company’s efforts to prepare for the potential securitization transaction, and management and the Board discussed the potential timeline for a securitization and the flexibility that the Company would have to pursue a securitization should the sale process continue into September.

Later on August 7, 2025, TriArtisan provided a letter reaffirming its non-binding offer of $6.25 per share. TriArtisan reiterated that it intended to finance the transaction with a combination of third-party senior debt and equity capital, with the equity portion coming from sources including TriArtisan and Yadav Enterprises as well as the alternate source of equity financing already identified, and the debt capital coming from one or more of various lenders identified in the letter.

On August 13, 2025, representatives of Morgan Lewis engaged in an introductory telephone conversation with representatives of Ropes & Gray LLP (“Ropes & Gray”), counsel to TriArtisan. During the call, the attorneys discussed various matters including the structure of the transaction, the timing for the initial draft of the merger agreement, and certain high-level due diligence questions. In addition, the attorneys discussed an exclusivity period.

Later on August 13, 2025, Morgan Lewis provided Ropes & Gray with an initial draft of an addendum to the April 21, 2025 non-disclosure agreement between the Company and TriArtisan that contemplated an agreement to provide TriArtisan with exclusivity period through September 5, 2025, with such period to automatically extended through September 19, 2025 so long as by or before September 5, 2025, TriArtisan delivered to the Company a comprehensive revised draft of the Company’s draft merger agreement for the potential merger and evidence, satisfactory to the Company in its reasonable discretion, that TriArtisan would be able to secure binding commitments for the necessary debt and equity financing for the potential merger.

On August 14, 2025, the Company granted TriArtisan permission to contact a select group of potential direct lenders, subject to such direct lenders executing acceptable non-disclosure agreements with the Company.

On August 15, 2025, the Company received an e-mail from JCP Investment Management, LLC (“JCP”), which characterized itself as a new investor in the Company, in which JCP requested an in-person meeting with Ms. Valade and Mr. Verostek for mid to late September in South Carolina.

On August 21, 2025, the Board held a special meeting via teleconference, with certain of the Company’s senior officers and representatives of Truist Securities, Morgan Lewis and Sidley participating. Representatives of Truist Securities updated the Board on the status of TriArtisan’s work towards finalizing a transaction. The representatives of Truist Securities also conveyed to the Board that TriArtisan had requested an exclusivity agreement, and the Board discussed the request and how an exclusivity period might interplay with the potential timeline for the potential securitization. Representatives of Truist Securities and Morgan Lewis discussed the exclusivity structure that had been proposed to Ropes & Gray, in which TriArtisan would be granted exclusivity through September 5, 2025, with the period to be automatically extended through September 19, 2025 if, by no

 

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later than September 5, TriArtisan delivered materials showing adequate progress towards obtaining viable financing, as well as a markup of a draft definitive merger agreement. The exclusivity agreement would provide the Company with latitude to continue with efforts towards the securitization. Later in the meeting, the Board approved entering into the exclusivity agreement on the basis presented. Representatives of Truist Securities also reviewed with the Board Truist Securities’ updated preliminary financial analyses relating to the Company and the proposed transaction. The representatives of Truist Securities reviewed with the Board updates to management’s projections since those approved on April 24, 2025, which consisted of updates to the 2025 full-year projections (but not to any of the other years in the projections) to reflect actual results for the second quarter of 2025. Following discussion, the Board determined to continue to work toward finalizing the transaction documentation by September 1, 2025.

Also at the August 21, 2025 meeting, representatives of Sidley provided advice to the Board regarding the email received on August 15 from JCP. They discussed the history and past activities of JCP and its principal, and, on a preliminary basis, the manner in which the Company could meet with JCP in late September or early October.

Also on August 21, 2025, representatives of Morgan Lewis delivered to representatives of Ropes & Gray an initial draft of a proposed merger agreement for the proposed transaction, which included the following key terms: (1) a “two-step” tender offer/merger structure in accordance with Section 251(h) of the Delaware General Corporation Law; (2) extensive, broad representations and warranties of the Company; (3) interim operating covenants with which the Company would be obligated to comply between the signing of the merger agreement and the closing of the merger; (4) the right of the Company to accept a Superior Proposal, with a “Superior Proposal” defined as a bona fide proposal to acquire more than 50% of the stock or assets of the Company that is deemed in good faith by the Board to be more favorable to the Company’s stockholders than the merger contemplated by the proposed merger agreement; (5) the right of the Board to change its recommendation with respect to the merger in certain limited circumstances, including the occurrence of certain events following the execution of the merger agreement; (6) payment of a termination fee by the Company under certain circumstances, including in the event of a material breach by the Company or any of its representatives of the no-shop provisions of the merger agreement, with a proposal that such fee be equal to 1.0% of the Company’s total enterprise value, and (7) payment of a termination fee by TriArtisan under certain circumstances, including certain terminations of the merger agreement by the Company upon TriArtisan’s failure to consummate the transaction in accordance with its terms, but without a proposal for the amount for such fee.

On August 29, 2025, members of the Company’s management team met in Spartanburg, South Carolina with representatives of TriArtisan.

During the remainder of August and the first week of September, the Company received and entered into non-disclosure agreements with various potential debt and equity financing sources identified by TriArtisan, as well as with a well-established commercial real estate owner (with whom the Company had previously had discussions regarding a potential sale/leaseback transaction) as the potential purchaser of the Company’s real estate in a sale/leaseback transaction.

On September 5, 2025, the Board held a special meeting via teleconference, with certain of the Company’s senior officers and representatives of Truist Securities and Morgan Lewis participating. The Board discussed that the exclusivity agreement approved by the Board at its August 21 meeting had not in fact been executed, and that the purpose of the meeting was to determine whether TriArtisan had demonstrated sufficient progress such that the Company should continue in discussions with them concerning a potential transaction. Representatives of Truist Securities then provided an update on information received from TriArtisan, including a revised draft of the merger agreement that was received by Morgan Lewis during that meeting. The representatives of Truist Securities also informed the Board that TriArtisan had indicated that it would be forwarding later that day a letter detailing their progress with respect to financing, as well as letters from proposed financing sources in a total amount equal to or greater than the amount needed to complete the proposed transaction.

 

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The Truist Securities representatives also told the Board that TriArtisan had communicated that they would need 30 days of exclusivity in order to move forward with finalizing the financing documents and the merger agreement. The Board discussed the request for 30 days, noting that it exceeded the September 19 deadline discussed at the prior meeting. After discussion, including with respect to the timeline of the potential securitization, the Board approved agreeing to an exclusivity period with TriArtisan through September 29, 2025, subject to the Company being able to continue work on the sale/leaseback during that period.

Later on September 5, 2025, TriArtisan provided an updated bid package that included a term sheet for debt financing from a well-established provider of private debt financing, equity support letters from Yadav Enterprises and the alternate source of equity financing previously identified to the Board and a letter of intent for a sale/leaseback transaction from a well-established commercial real estate owner as the potential purchaser of the Company’s real estate.

The revised draft of the merger agreement sent by Ropes & Gray to Morgan Lewis on September 5, 2025 included, among other things: (1) modification of the structure of the transaction from a “two-step” tender offer/merger structure to a “one-step” merger structure; (2) substantially expanded representations and warranties of the Company; (3) expanded interim operating covenants with which the Company would be obligated to comply between the signing of the merger agreement and the closing of the merger; (4) increased restrictions on the ability of the Company to engage in discussions with other parties following the execution of the merger agreement, and limiting modifications to the provisions relating to the right of the Company to accept a Superior Proposal; (5) increased limitations on the right of the Board to change its recommendation with respect to the merger in certain limited circumstances, including the occurrence of certain events following the execution of the merger agreement; (6) a proposal that the termination fee payable by the Company under certain circumstances be equal to 4.0% of the Company’s total equity value, and (7) a proposal that the termination fee payable by TriArtisan under certain circumstances also be equal to 4.0% of the Company’s total equity value.

On September 6, 2025, Truist Securities communicated to TriArtisan the proposed terms of the exclusivity agreement approved by the Board, including the September 29 expiration date and the ability of the Company to continue work on the securitization, and TriArtisan orally agreed to that structure. Representatives of Morgan Lewis and Ropes & Gray spoke on September 7, 2025 and confirmed this structure.

On September 9, 2025, the Company received, from the potential purchaser of the Company’s real estate in a sale/leaseback transaction described above, a draft letter of intent for the sale/leaseback transaction. The draft letter of intent was addressed to TriArtisan and contemplated that TriArtisan would be the seller in the transaction. The letter of intent contemplated the sale of approximately 75 properties owned by the Company for a purchase price of approximately $150 million, with such properties to be leased back to the Company, or in certain cases to franchisees of the Company, at the closing of the transaction.

On September 11, 2025, Ropes & Gray sent to Morgan Lewis a revised draft of the exclusivity addendum to the April 21, 2025 non-disclosure agreement that Morgan Lewis had shared on August 13. The revised draft contemplated the previously discussed September 29 expiration date and the ability of the Company to continue work on the securitization. It also provided that in the event the merger is not ultimately consummated, the Company would pay certain third-party costs associated with the proposed sale/leaseback transaction, and that the Company and TriArtisan would each pay one-half of the attorney fees and costs generated by the proposed purchaser in the sale/leaseback transaction. The exclusivity addendum was subsequently executed by the parties on September 15, 2025.

On September 12, 2025, the Company received, from the potential purchaser of the Company’s real estate in a sale/leaseback transaction described above, a draft purchase and sale agreement incorporating the terms of the letter of intent for the sale/leaseback transaction.

 

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On September 15, 2025, Morgan Lewis sent a revised draft of the merger agreement to Ropes & Gray, which included, among other things: (1) acceptance of the “one-step” merger structure; (2) acceptance of the expanded representations and warranties of the Company, subject to certain tailoring with respect to scheduling burdens; (3) strengthened covenants with respect to equity and debt financing; (4) updates to the proposed interim operating covenants to permit certain ordinary course operations of the Company during the period between the signing of the merger agreement and the closing of the merger; (5) expanded permissibility relating to the right of the Company to accept a Superior Proposal or for the Board to change its recommendation, but acceptance of certain other restrictions on the ability to engage in discussions with respect to an unsolicited offer; (6) a proposal that the termination fee payable by the Company under certain circumstances be equal to 3.0% of the Company’s total equity value, and (7) a proposal that the termination fee payable by TriArtisan under certain circumstances be equal to 6.0% of the Company’s total equity value.

Also on September 15, 2025, JCP filed with the U.S. Securities and Exchange Commission a Schedule 13D. The Schedule 13D reported that JCP had formed a group with Jumana Capital Investments LLC (“Jumana”), a private investment fund headquartered in Houston, Texas that is known as an activist investor, with respect to the securities of the Company owned by them. The Schedule 13D disclosed that the group (the “JCP/Jumana Group”) intended to engage in discussions with Company management and the Board “regarding opportunities to enhance stockholder value, and believe there is a significant opportunity for [the Company] to increase its earnings over the coming years.”

On September 16 and 17, 2025, the Board held a regularly scheduled in-person meeting, with certain of the Company’s senior officers and representatives of Morgan Lewis and Sidley participating, at which it discussed various matters, including receiving updates on the status of the business and certain operational and financial matters, as well as on the status of the transaction with TriArtisan, the proposed securitization, and expected interactions with the JCP/Jumana Group. Sidley discussed the filing of the Schedule 13D by the JCP/Jumana Group, and the activist histories of the two entities, as well as preparations for the upcoming meeting with the JCP/Jumana Group. Representatives of Morgan Lewis then provided an update on the status of the negotiations with TriArtisan, noting that the draft merger agreement was progressing, and that TriArtisan appeared to be focused primarily on completing their financing. The Board expressed its continued belief that the Company and its advisors should be pushing for TriArtisan to move as quickly as possible. Mr. Verostek also described the Company’s ongoing work to obtain an extension of the maturity of its existing revolving line of credit, in light of the apparent timing of the transaction with TriArtisan and the fact that any securitization transaction would be delayed from its originally planned timing.

On September 19, 2025, Truist Securities provided a relationships disclosure memorandum to the Company, which was subsequently provided to the Board. The memorandum confirmed among other things that based on a review of its information management systems, Truist Securities did not identify any M&A advisory fees, other investment banking revenues or corporate banking revenues, during the period from January 1, 2023 to September 19, 2025, that it received from any of TriArtisan, Yadav Enterprises or the alternate source of equity financing then identified to the Board.

On September 23, 2025, TriArtisan informed representatives of Truist Securities that it was expecting to cease discussions with the entity that had been the anticipated purchaser of the Company’s real estate in the sale/leaseback, and instead engage with another well-established commercial real estate owner as the potential purchaser in the transaction.

On September 24, 2025, Morgan Lewis shared with Ropes & Gray an initial draft of the Company’s disclosure schedules to the Merger Agreement.

On September 25, 2025, TriArtisan shared with the Company a draft letter of intent for the sale/leaseback transaction, with the new expected purchaser. The draft letter of intent was addressed to TriArtisan and contemplated that TriArtisan would be the seller in the transaction. The letter of intent contemplated the sale of

 

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approximately 75 properties owned by the Company for a purchase price of $147.5 million, with such properties to be leased back to the Company, or in certain cases to franchisees of the Company, at the closing of the transaction.

On September 28, 2025, representatives of Truist Securities spoke with TriArtisan. TriArtisan indicated that it would be forwarding updated materials later that day, including a letter setting forth the progress (substantially completed business, accounting and legal due diligence) made on the transaction, and reiterating its desire to complete the transaction at a per share purchase price of $6.25, as well as detailed term sheets from two well-established providers of private debt financing, each offering to provide the full amount of the debt capital required for the deal, an executed term sheet with the new expected purchaser in the sale/leaseback, and communications from the previously identified providers of equity financing reiterating their equity commitments. TriArtisan also indicated that Ropes & Gray would send a revised draft of the merger agreement.

Later that day, TriArtisan provided the materials it had described in the earlier call. In addition, Ropes & Gray sent a revised draft of the merger agreement to Morgan Lewis, which it supplemented with an additional draft on October 2, 2025, which included, among other things, (1) limited expansion of representations and warranties of the Company; (2) significant expansion of interim operating covenants restricting the Company’s actions during the period between the signing of the merger agreement and the closing of the merger; (3) acceptance that the termination fee payable by the Company under certain circumstances be equal to 3.0% of the Company’s total equity value; (4) a proposal that the termination fee payable by TriArtisan under certain circumstances be equal to 4.5% of the Company’s total equity value; (5) a proposal that the Company’s equity awards would not be subject to adjustment by the Board but would pay out based on the terms of the underlying agreement; and (6) a proposal that, following the merger, employees would receive compensation and benefits “substantially similar”, instead of “no less favorable”, to their pre-merger compensation and benefits.

On September 29, 2025, the Board held a special meeting via teleconference, with certain of the Company’s senior officers and representatives of Truist Securities, Morgan Lewis and Sidley participating. With representatives of Truist Securities and Morgan Lewis joining, the Board and members of management discussed the transaction and its status, including with respect to the merger agreement and the status of TriArtisan’s financing discussions. The Board then discussed the securitization, confirming that it remained on hold, and informed the Board that the previously discussed extension of the revolving credit facility remained on track. Representatives of Truist Securities then reviewed the history of the transaction with TriArtisan and its current status, noting the reaffirmations provided by TriArtisan and its financing sources the previous day. The Board asked management to discuss the sale/leaseback transaction, and they noted that all third-party work was expected to be finished in the week of October 13. Representatives of Sidley then spoke to the Board regarding the meeting it planned to have later on September 29 with representatives of the JCP/Jumana Group, as well as other related matters including the current ownership level of certain of the Company’s other large stockholders. Thereafter, following additional discussion of the request by TriArtisan for an extension of exclusivity, the Board approved an extension of exclusivity to October 13, 2025, with management having the authority to further extend the exclusivity period through October 17, 2025, subject to first consulting with the Board’s Audit Committee. Thereafter, effective September 29, 2025, the parties agreed to an amendment to the exclusivity addendum to extend its term through October 13, 2025.

Later on September 29, 2025, members of management held the planned meeting with representatives of the JCP/Jumana Group, at which such representatives expressed their views on certain operational, strategic and governance matters regarding the Company.

On October 2, 2025, Ropes & Gray sent to Morgan Lewis drafts of proposed term sheets submitted to TriArtisan by the two providers of private debt financing referred to above.

On October 6, 2025, representatives of Morgan Lewis delivered a revised draft of the merger agreement to representatives of Ropes & Gray that included, among other things: (1) carveouts to interim operating covenants,

 

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including with respect to ability to draw down on the Company’s revolving credit facility during this period; (2) a proposal that the termination fee payable by TriArtisan under certain circumstances be equal to 5.0% of the Company’s total equity value; (3) a proposal that the Company’s equity awards be paid out at the greater of the value based on assumed target performance and the terms of the underlying agreement; and (4) a proposal that, following the merger, employees would receive compensation and benefits “no less favorable” than their pre-merger compensation and benefits.

On October 7, 2025, representatives of the JCP/Jumana Group contacted Ms. Valade and Mr. Verostek, thanking them for the meeting the prior week and requesting a follow up call on October 16, 2025.

On October 8, 2025, Truist Securities forwarded to Morgan Lewis a draft purchase and sale agreement from the proposed purchaser in the sale/leaseback transaction, incorporating the terms of the September 25 letter of intent.

On October 9, 2025, the expected purchaser in the sale/leaseback transaction informed the other parties to the transaction that it was proposing a closing condition to the sale/leaseback transaction that the Company obtain, between signing of the sale/leaseback purchase agreement and the closing of the transaction, lease amendments from current tenants and subtenants of the properties to be purchased.

On October 10, 2025, representatives of the Company, TriArtisan, Ropes & Gray and Morgan Lewis held a video conference during which Ropes & Gray posed certain questions as part of its ongoing legal due diligence process.

Around this time, TriArtisan informed the Company that it was contemplating replacing the alternate source of equity financing that it had expected to provide the largest portion of the equity financing with Treville Capital Group (“Treville”), an investment firm focused on alternative assets with substantial assets under management and transactional experience. Treville executed a joinder to TriArtisan’s non-disclosure agreement with the Company on October 11, 2025.

On October 13, 2025, representatives of Ropes & Gray delivered a revised draft of the merger agreement to representatives of Morgan Lewis that included ongoing back-and-forth on the open issues from prior drafts, as well as a covenant regarding the Company’s required efforts to support TriArtisan’s sale/leaseback transaction.

Also on October 13, 2025, Ropes & Gray conveyed to Morgan Lewis TriArtisan’s request that the exclusivity period be extended through October 23, 2025, and provided a draft amendment to the existing exclusivity addendum.

On October 16, 2025, Ropes & Gray sent to Morgan Lewis a draft of an equity commitment letter to be entered into by the proposed sources of equity financing.

Also On October 16, 2025, the law firm providing legal counsel provided to the expected purchaser in the sale/leaseback transaction provided a form of lease amendment to address the amendment they had proposed on October 9.

On October 17, 2025, Morgan Lewis, Ropes & Gray and representatives of the law firm providing legal counsel to the expected purchaser in the sale/leaseback transaction engaged in a discussion regarding several aspects of the transaction, including a requirement by the purchaser that the Company obtain, between signing of the sale/leaseback purchase agreement and the closing of the transaction, lease amendments from current tenants and subtenants of the properties to be purchased. The representatives of Morgan Lewis conveyed that requiring such a closing condition to the sale/leaseback would be unacceptable to the Company.

Also on October 17, 2025, the Board held a special meeting via teleconference, with certain of the Company’s senior officers and representatives of Morgan Lewis participating. After a discussion of the progress

 

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of the proposed amendment to the Company’s revolving credit agreement, the Board engaged in a discussion of the progress of the transaction with TriArtisan, with representatives of Morgan Lewis providing an update on the status of the merger agreement and certain open items therein, as well as the status of TriArtisan’s efforts to finalize their equity and debt financing and the sale/leaseback transaction, and of the request by the expected purchaser in the sale/leaseback that certain provisions of the existing subleases with franchisees be modified. Management and a representative of Morgan Lewis also indicated that TriArtisan had requested a further extension of the exclusivity period through October 23. The Board discussed this request, and then approved an extension of exclusivity to October 21, 2025, with management having the authority to further extend the exclusivity period through October 27, 2025, subject to first consulting with the Board’s Audit Committee.

Also on October 17, 2025, Morgan Lewis sent a revised draft of the merger agreement to Ropes & Gray, which included, among other things, (1) limitations on the cooperation covenant for the sale/leaseback transaction in light of review of the proposed purchase and sale agreement for the sale/leaseback transaction. (2) a proposal that the Company’s equity awards granted in 2024 be paid out at the greater of the value based on assumed target performance and the terms of the underlying agreement; and (3) a proposal that, following the merger, employees would receive compensation and benefits “no less favorable” than their pre-merger compensation and benefits.

Over the weekend of October 18 and 19, 2025, TriArtisan and its counsel discussed sublease amendments. Additionally, the Company and its counsel and the expected purchaser in the sale/leaseback and its counsel discussed in separate communications the expected purchaser’s requirement that it receive lease amendments prior to being obligated to consummate the sale/leaseback transaction. Because the Company was unwilling to accept a structure where this requirement would constitute a closing condition to the sale/leaseback transaction, the Company agreed to undertake to obtain a substantial number of such amendments prior to the signing of the purchase agreement for the sale/leaseback and the merger agreement. The Company in fact undertook these efforts over the following days and obtained a significant majority of the requested amendments.

On October 21, 2025, Ropes & Gray sent to Morgan Lewis revised drafts of the equity commitment letter and debt commitment letter originally sent on October 16, as well as a form of a limited guarantee to be entered into by the providers of equity financing with respect to the obligations of the purchaser under the merger agreement to pay the Parent Termination Fee.

On October 22, 2025, members of Company management spoke with representatives of the JCP/Jumana Group, per the request from the group on October 7, 2025. At the meeting, among other things, the JCP/Jumana Group stated that while it preferred that the Company remain a public company, it would potentially have interest in acquiring the Company should it determine to go private.

Also on October 22, 2025, after considering certain issues potentially raised by the conversation the prior day with the JCP/Jumana Group, and discussing the matter with its current counsel at Morgan Lewis and Sidley, the Company decided to engage counsel specializing in Delaware law, and engaged Morris, Nichols, Arsht & Tunnell LLP (“Morris Nichols”) for this purpose.

Also beginning on October 22, 2025, and continuing through the signing of the merger agreement on November 3, 2025, Ropes & Gray and Morgan Lewis exchanged revised drafts of the merger agreement, working to resolve all remaining open items in the agreement.

On October 23, 2025, the Board held a special meeting via teleconference, with certain of the Company’s senior officers and representatives of Truist Securities, Morgan Lewis and Sidley participating. The Board primarily engaged in a discussion of the JCP/Jumana Group’s expressed interest in a potential acquisition of the Company. Representatives of Morgan Lewis discussed legal considerations under Delaware law regarding the Board’s fiduciary obligations and potential courses of action in the context of the JCP/Jumana Group’s

continuing stockholder activism and their expressed interest in a transaction with the Company. A representative

 

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of Morgan Lewis noted that as directed by management and the Board after the October 22 meeting, he had reached out to lawyers at Morris Nichols, who would be available for discussions. Representatives of Sidley then discussed the potential implications of the JCP/Jumana Group’s activities.

At the request of the Board, representatives of Truist Securities then reviewed information regarding Jumana and JCP, including their apparent financial resources and areas of industry interest based on their public disclosures and participation in past transactions. They also noted the lengthy timeframe of TriArtisan’s efforts to identify sources of equity and debt financing for its bid for the Company (most of which appeared to be attributable to an apparent limited interest in the business category), and how that would be instructive of the challenges that the JCP/Jumana Group would likely face in seeking to put together financing for an potential bid they may make.

The Board then discussed the status of the transaction with TriArtisan, which appeared to be moving toward signing in the near future. In response to a question from the Board, representatives of Truist Securities indicated that TriArtisan had not communicated anything suggesting they were not committed to the $6.25 per share price. The Board also discussed the structure of the deal protection provisions in the draft merger agreement, including the nature of the no shop and the reasonable break fee, contemplated to be 3% of total equity value. The Board then discussed whether to consider and potentially adopt a stockholder rights plan in conjunction with the transaction and agreed to further consider that matter going forward. Following this discussion, the Board unanimously instructed its advisors to move forward in working to finalize and execute the merger agreement with TriArtisan, and not to further engage with the JCP/Jumana Group.

From October 24, 2025 through October 31, 2025, the parties and their representatives engaged in numerous calls and communications focused on finalizing the terms of the transaction and the transaction documentation, including exchanging comments on the merger agreement, disclosure schedules, equity and debt commitment letters, and limited guarantees, as well as the purchase agreement for the sale/leaseback transaction.

Over the weekend of November 1 and November 2, 2025, TriArtisan agreed that it would be the party to the equity commitment letter and limited guarantee, with TriArtisan and the equity investors being party to a proposed interim investors agreement to govern certain matters as among TriArtisan and the various financing sources between signing and closing of the proposed merger.

On November 3, 2025, the Board held a meeting at which members of senior management of the Company and representatives of Truist Securities, Morgan Lewis, Morris Nichols and Sidley were present, to consider approval of the proposed transaction with Parent. The meeting commenced with a summary by members of management and representatives of the various advisors of the developments in the transaction and the merger agreement over the last several days, including a description of the modifications made over the weekend to the structure of the equity commitments and limited guarantee and the addition of the interim investors agreement.

Representatives of Truist Securities then reviewed and discussed with the Board its financial analyses with respect to the Company and the proposed Merger, based on the financial projections provided to it by the Company (which were the same projections modified by the Company in August 2025 and reviewed at the August 21, 2025 Board meeting) for reliance on and use by Truist Securities in connection with rendering its opinion to the Board and performing its related financial analyses as described in the section of this proxy statement captioned “—Opinion of Truist Securities.” Thereafter, at the request of the Board, Truist Securities rendered its oral opinion to the Board as to, as of November 3, 2025, the fairness, from a financial point of view, to the holders of Company Shares of the Merger Consideration to be received by such holders in the Merger pursuant to the Merger Agreement, as more fully described below under the caption “—Opinion of Truist Securities.”

Representatives of Morgan Lewis then reviewed the terms of the final proposed Merger Agreement with Parent and discussed with the Board its fiduciary duties in the context of considering the transaction, referring to

 

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past discussions of these issues during prior meetings. They also reviewed with the Board the sale/leaseback transaction and indicated the parties thereto were prepared to sign the purchase agreement.

Representatives of Sidley then discussed the potential implementation of a stockholder rights plan following the transaction in light of the recent activism and interest in the Company expressed by the JCP/Jumana Group, noting that any such rights plan would be structured to permit a potential buyer to make an offer that would constitute a Superior Company Proposal as contemplated by the Merger Agreement. Following brief discussion, the Board indicated that it was not inclined to adopt a rights plan at the present time.

Representatives of Morgan Lewis then summarized the resolutions that had been distributed to the Board in advance of the meeting, and following additional discussion and consideration of the Merger Agreement, the Merger and the other transactions contemplated by the Merger Agreement (including the factors described in “—Recommendations of the Denny’s Corporation Board and Reasons for the Merger”), the Board unanimously approved resolutions: (i) determining that the Merger Agreement and the transactions contemplated thereby, including the Merger, are advisable, fair to and in the best interests of the Company and the Stockholders, and declaring it advisable for the Company to enter into the Merger Agreement, (ii) approving and declaring advisable the execution and delivery by the Company of the Merger Agreement, the performance by the Company of its covenants and agreements contained in the Merger Agreement, and the consummation of the Contemplated Transactions upon the terms and subject to the conditions contained in the Merger Agreement, and (iii) directing that the Merger Agreement and the transactions contemplated thereby be submitted to the Stockholders at a special meeting of the stockholders for adoption as contemplated by the Merger Agreement, and recommending that the Stockholders vote in favor of the adoption of the Merger Agreement and the approval of the transactions contemplated thereby at such meeting.

Following the Board meeting, the Company, Parent and Merger Sub executed the Merger Agreement, and exchanged executed copies of the other agreements entered into in connection therewith, including the equity and debt commitment letters, limited guarantee, the interim investors agreement and the purchase agreement for the sale/leaseback transaction.

Later in the evening of November 3, 2025, the Company issued a press release announcing the execution of the Merger Agreement.

Recommendations of the Denny’s Corporation Board and Reasons for the Merger

At a meeting of the Board held on November 3, 2025, the Board reviewed and considered the terms of the Merger Agreement, and unanimously (i) determined that the Merger Agreement and the transactions contemplated thereby, including the Merger, are advisable, fair to, and in the best interests of the Company and its stockholders and declared it advisable for the Company to enter into the Merger Agreement; (ii) approved and declared advisable the execution and delivery by the Company of the Merger Agreement, the performance by the Company of its covenants and agreements contained therein, and the consummation of the Merger and the other transactions contemplated thereby upon the terms and subject to the conditions contained therein; (iii) resolved that the Merger be effected under Section 251 of the DGCL; (iv) directed that the Merger Agreement be submitted to the stockholders of the Company for adoption at the Special Meeting; and (v) recommended that the Company’s stockholders vote “FOR” the adoption of the Merger Agreement. The Board recommends that the Company’s stockholders vote “FOR” the approval of the Merger Proposal, “FOR” the Compensation Advisory Proposal and “FOR” the Adjournment Proposal.

In reaching the decisions to approve the Merger Agreement and the Merger, and to recommend that the Company’s stockholders vote to adopt the Merger Agreement, the Board consulted extensively with its outside financial and legal advisors and Company management and conducted comparative analysis and considered a

 

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number of factors that the Board viewed as being significant in coming to its determination and recommendation. These factors included, without limitation, the following considerations, which are not presented in any relative order of importance:

Stockholder Value

The Board considered several factors pertaining to the value to be received by the Company’s stockholders pursuant to the Merger Agreement, including, but not limited to, the following:

 

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The current, historical and projected financial condition and results of operations of the Company on a stand-alone basis.

 

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The risk-adjusted probabilities associated with achieving the Company’s long-term strategic plan as a stand-alone company.

 

•

The fact that, upon the Closing, each stockholder of the Company will have the right to receive the Merger Consideration of $6.25 in cash for each share of Common Stock owned by such stockholder.

 

•

The Merger Consideration represents a premium to the Company’s stockholders compared to the prevailing market price across several measurement periods, including a premium of approximately 52.1% to the Company’s stockholders based on the closing price of the Common Stock on November 3, 2025, the last trading day before the execution of the Merger Agreement.

 

•

The Merger Consideration consists solely of cash, which provides immediate liquidity and certainty of value to the Company’s stockholders.

 

•

The financial analyses reviewed and discussed with the Board by representatives of Truist Securities as well as the oral opinion of Truist Securities rendered to the Board on November 3, 2025 (which was subsequently confirmed in writing by delivery of Truist Securities’ written opinion dated November 3, 2025), as to the fairness, from a financial point of view, to the holders of Company Shares of the Merger Consideration to be received by such holders in the Merger pursuant to the Merger Agreement, which opinion was based on and subject to the matters considered, the procedures followed, the assumptions made and various limitations of and qualifications to the review undertaken as more fully described under the section entitled “—Opinion of Truist Securities” below.

 

•

The historical and current market price of the Common Stock.

 

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The Board’s analysis of other strategic alternatives for the Company, including continued growth as an independent company and the potential to acquire, be acquired or combine with other third parties.

 

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The fact that if the Company’s stockholders so desire and if they comply fully with all of the required procedures under the DGCL, they will be able to exercise appraisal rights with respect to the Merger, which would allow such stockholders to seek appraisal of the fair value of their shares of Common Stock as determined by the Delaware Court of Chancery as further described in detail below under the section entitled “The Merger—Appraisal Rights” beginning on page 63.

 

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The Merger is not subject to any financing condition, which enhances the likelihood of the Merger’s consummation, and Parent having obtained committed debt financing from reputable financial institutions, a commitment to obtain or cause to be obtained equity financing from TriArtisan Capital Advisors, and committed funds from consummating a Sale/Leaseback Transaction with a reputable real property purchaser, in an aggregate amount sufficient to fund the required amounts.

 

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The Board’s risk assessment, after consultation with the Company’s outside legal counsel, that no regulatory authorities would impose conditions sufficiently material to preclude the Merger, and that it would otherwise be consummated in accordance with the terms of the Merger Agreement.

 

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The recommendation of Company management in favor of the transaction.

 

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•

The Board’s belief that the terms of the Merger Agreement, including the parties’ representations, warranties and covenants and the conditions to their respective obligations, are fair and reasonable.

 

•

The Board’s belief that the terms of the Merger Agreement, taken as a whole, provide a degree of certainty that the Merger will be completed, including the fact that (1) the conditions required to be satisfied prior to completion of the Merger, such as the receipt of the Company’s stockholder approval and regulatory approvals, if any, are expected to be fulfilled, (2) the Merger Agreement contains no financing condition, and (3) there are limited circumstances in which Parent may terminate the Merger Agreement.

 

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The fact that the Merger Agreement provides that, under certain circumstances, and subject to certain conditions, the Company is permitted to furnish information to and conduct negotiations with a third party in connection with an unsolicited proposal for a business combination or acquisition of the Company that constitutes or would reasonably be expected to lead to a Superior Company Proposal (as defined in the Merger Agreement).

 

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That Parent may be required to pay to the Company a termination fee in the amount of $17,200,000 in certain circumstances specified in the Merger Agreement.

 

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The commitments by Parent to, among other things, (1) for a period of twelve months following the consummation of the Merger, maintain for the benefit of each continuing employee of the Company and Parent an annual base salary or wage rate and a target short-term incentive cash compensation opportunity that, in each case, is no less favorable than that provided immediately prior to the Merger, (2) treat similarly situated continuing employees on a substantially equivalent basis, taking into account all relevant factors, including duties, geographic location, tenure qualifications and abilities, and (3) treat each continuing employee’s service with each of Parent and the Company (as well as service with any predecessor employer of the foregoing, to the extent service with the predecessor employer was recognized by Parent or the Company prior to the closing of the Merger and is accurately reflected within its employee’s records) as service with the combined company or any of its subsidiaries for all purposes, including determining eligibility to participate in incentive and health and welfare benefits, level of benefits, vesting and benefit accrual, which the Board believed would redound to the benefit of the combined company.

In addition to the above factors, the Board also identified and considered a number of uncertainties, risks and other potentially negative factors in its consideration of the Merger and the Merger agreement, including without limitation:

 

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The Company will no longer exist as an independent company, and accordingly, the Company’s stockholders will no longer participate in any future growth it may have or any potential future increase in its value.

 

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The fact that the Merger might not be completed in a timely manner or at all in the event of a failure of certain closing conditions, including in particular (1) any regulatory clearances and (2) that any regulatory approvals might impose conditions which could adversely affect the operations and value of the combined company.

 

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The fact that Parent and Merger Sub are newly formed entities with essentially no assets and the Limited Guarantee (as defined in the Merger Agreement), provided by TriArtisan Capital Advisors, guarantees Parent’s and Merger Sub’s obligations under the Merger Agreement only with respect to payment of the Parent Termination Fee payable by Parent and certain other reimbursement obligations, subject to the Reimbursement and Enforcement Cap (as defined in the Limited Guarantee).

 

•

The risks and costs to the Company if the Merger is not completed, including the diversion of management and employee attention, and potential employee attrition and the potential effect on the Company’s business and relations with customers, franchisees and suppliers.

 

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•

The restrictions on the conduct of the Company’s business prior to completion of the Merger, which could delay or prevent the Company from undertaking business opportunities that might arise pending completion of the Merger.

 

•

The fact that the Company has incurred and will continue to incur costs related to the Merger, a portion of which will be payable whether or not the Merger is completed.

 

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The potential for litigation relating to the Merger and the associated costs, burden and inconvenience involved in defending those proceedings.

 

•

The fact that the Company’s directors and executive officers may have interests in the Merger that are different from, or in addition to, those the Company’s stockholders generally, including certain interests arising from the equity and other compensation arrangements of the Company’s directors and executive officers, and the manner in which they would be affected by the Merger. See “—Interests of Denny’s Corporation Directors and Executive Officers in the Merger” beginning on page 52 for further information.

 

•

The restrictions on the Company’s ability to solicit or participate in discussions or negotiations regarding alternative business combination transactions, subject to specified exceptions, and the requirement that the Company pay to Parent (or its designee) a termination fee in the amount of $10,320,000 in certain circumstances specified in the Merger Agreement, which the Board understood, while potentially having the effect of discouraging third parties from proposing a competing business combination transaction, were conditions to Parent’s willingness to enter into the Merger Agreement and were reasonable in light of, among other things, the anticipated benefits of the Merger to the Company’s stockholders.

 

•

The restrictions in the Merger Agreement on the conduct of the Company’s business prior to the consummation of the Merger, including that the Company must conduct its business in the ordinary course of business, subject to specific limitations, which may delay or prevent the Company from undertaking business opportunities that may arise or taking other actions it would otherwise take with respect to its operations pending consummation of the Merger.

 

•

That the receipt of the Merger Consideration in exchange for shares of Common Stock will be a taxable transaction to U.S. holders (as defined below) for U.S. federal income tax purposes.

 

•

The risk that the Company’s stockholders may not approve the proposals at the Company stockholder meeting.

The Board believed that, overall, the potential benefits of the Merger to the Company and its stockholders outweighed the risks that are mentioned above.

The foregoing discussion of factors considered by the Board in reaching its conclusions and recommendation includes the principal factors considered by the Board, but is not intended to be exhaustive and may not include all of the factors considered by the Board. In light of the variety of factors considered in connection with its evaluation of the Merger, the Board did not consider it practicable and did not attempt to quantify or otherwise assign relative weights to the specific factors it considered. Rather, the Board made its determination based on the totality of the information it considered. Individually, each director may have given greater or lesser weight to a particular factor or consideration. The Board based its recommendation on the totality of the information available to it, including discussions with Company management and the Company’s outside legal and financial advisors It should be noted that this explanation of the reasoning of the Board and certain information presented in this section is forward-looking in nature and should be read in light of the factors set forth in “Cautionary Statement Regarding Forward-Looking Statements” beginning on page 18.

Opinion of Truist Securities

The Board considered the opinion, delivered orally on November 3, 2025 and confirmed by delivery of a written opinion dated as of November 3, 2025, of Truist Securities’ to the Board as to the fairness, from a

 

43

financial point of view, of the Merger Consideration of $6.25 in cash to the holders of Common Stock (excluding shares of Common Stock owned by the Company as treasury stock and shares of Common Stock owned by Parent or Merger Sub), which opinion was based on and subject to the matters considered, the procedures followed, the assumptions made and various limitations of and qualifications to the review undertaken as more fully described under the section entitled “—Opinion of Truist Securities” below. The full text of the written opinion of Truist Securities’ is attached to this proxy statement as Annex B.

Opinion of Truist Securities

On November 3, 2025, Truist Securities rendered its oral opinion to the Board (which was subsequently confirmed in writing by delivery of Truist Securities’ written opinion dated November 3, 2025) as to the fairness, from a financial point of view, to the holders of Company Shares of the Merger Consideration to be received by such holders in the Merger pursuant to the Merger Agreement.

Truist Securities’ opinion was directed to the Board (in its capacity as such) and only addressed the fairness, from a financial point of view, to the holders of Company Shares of the Merger Consideration to be received by such holders in the Merger pursuant to the Merger Agreement and did not address any other aspect or implication of the Merger or any agreement, arrangement or understanding entered into in connection therewith or otherwise. The summary of Truist Securities’ opinion in this proxy statement is qualified in its entirety by reference to the full text of its written opinion, which is included as Annex B to this proxy statement and sets forth the procedures followed, assumptions made, qualifications to and limitations on the review undertaken and other matters considered by Truist Securities in preparing its opinion. However, neither Truist Securities’ written opinion nor the summary of its opinion and the related analyses set forth in this proxy statement is intended to be, nor does any of them constitute, advice or a recommendation as to, or otherwise address, how the Board, the Company, any security holder or any other person should act or vote with respect to any matter relating to the Merger or otherwise.

In connection with its opinion, Truist Securities conducted such reviews, analyses and inquiries as it deemed necessary and appropriate under the circumstances. Among other things, Truist Securities:

 

•

reviewed a draft, dated November 3, 2025, of the Merger Agreement;

 

•

reviewed certain publicly available business and financial information relating to the Company and the industry in which it operates;

 

•

reviewed certain other information relating to the historical, current and future business, financial condition, results of operations and prospects of the Company made available to Truist Securities by the Company, including projections with respect to the future financial performance of the Company prepared and provided to Truist Securities by the management of the Company in connection with the August 21, 2025, meeting of the Board (the “Denny’s Projections”);

 

•

reviewed the financial and operating performance of the Company as compared to that of companies with publicly traded equity securities that Truist Securities deemed relevant;

 

•

reviewed the publicly available financial terms of certain transactions that Truist Securities deemed relevant;

 

•

had discussions with certain members of the management of the Company and with certain of its representatives and advisors regarding the business, financial condition, results of operations and prospects of the Company and the Merger; and

 

•

undertook such other studies, analyses and investigations as Truist Securities deemed appropriate.

Truist Securities relied upon and assumed, without independent verification, the accuracy and completeness of all data, material and other information furnished, or otherwise made available, to it, discussed with or reviewed by it, or publicly available, and did not assume any responsibility with respect to such data, material

 

44

and other information. Truist Securities’ role in reviewing such data, material and other information was limited solely to performing such review as Truist Securities deemed necessary and appropriate to support its opinion and such review was not conducted on behalf of the Board, the Company or any other person. Management of the Company advised Truist Securities, and Truist Securities assumed, that the Denny’s Projections were reasonably prepared in good faith on bases reflecting the best currently available estimates and judgments of such management as to the future financial results and condition of the Company. At the Board’s direction, Truist Securities assumed that the Denny’s Projections provided a reasonable basis on which to evaluate the Company and the Merger, and at the Board’s direction, Truist Securities used and relied upon the Denny’s Projections for purposes of its analyses and opinion. Truist Securities expressed no view or opinion with respect to the Denny’s Projections or the assumptions on which they were based. Truist Securities further relied upon and assumed, without independent verification, that there had been no change in the business, assets, liabilities, financial condition, results of operations, cash flows or prospects of the Company since the dates of the information, financial or otherwise, provided to Truist Securities and that there was no information or any facts that would make any of the information discussed with or reviewed by Truist Securities incomplete or misleading.

Truist Securities also relied upon and assumed without independent verification that (a) the representations and warranties of all parties to the Merger Agreement and all of the documents and agreements referred to therein were true and correct; (b) each party to the Merger Agreement and all of the documents and agreements referred to therein would fully and timely perform all of the covenants and agreements required to be performed by such party under the Merger Agreement, and such other documents and agreements, as applicable; (c) the Merger would be consummated in accordance with the terms of the Merger Agreement without waiver, modification or amendment of any term, condition or agreement therein; and (d) in the course of obtaining any regulatory or third party consents, approvals or agreements in connection with the Merger, no delay, limitation, restriction or condition would be imposed that would have an adverse effect on the Company or the Merger. Truist Securities also assumed that the Merger Agreement, when executed by the parties thereto, would conform to the draft reviewed by Truist Securities in all respects material to its analyses and opinion.

Furthermore, in connection with its opinion, Truist Securities was not requested to, and did not, make any physical inspection or independent appraisal or evaluation of any of the assets, properties or liabilities (fixed, contingent, derivative, off-balance-sheet or otherwise) relating to the Company or any other party to the Merger, nor was Truist Securities provided with any such appraisal or evaluation. Truist Securities did not undertake any independent analysis of any potential or actual litigation, regulatory action, possible unasserted claims or other contingent liabilities to which the Company was or may have been a party or was or may have been subject, or of any governmental investigation of any possible unasserted claims or other contingent liabilities to which the Company was or may have been a party or was or may have been subject. Truist Securities did not express any opinion as to the price or range of prices at which Company Shares could be purchased or sold at any time.

Truist Securities’ opinion was necessarily based on financial, economic, monetary, market and other conditions as in effect on, and the information made available to Truist Securities as of, the date of its opinion. Truist Securities has no obligation to update, revise, reaffirm or withdraw its opinion or otherwise comment upon events occurring or information that otherwise comes to its attention after the date of its opinion. Furthermore, as the Board was aware, the credit, financial and stock markets were experiencing significant volatility and Truist Securities expressed no opinion or view as to any potential effects of such volatility on the Company or the Merger.

Truist Securities’ opinion only addressed the fairness, from a financial point of view, to the holders of Company Shares of the Merger Consideration to be received by such holders in the Merger pursuant to the Merger Agreement and did not address any other aspects or implications of the Merger or any agreement, arrangement or understanding entered into in connection therewith or otherwise. Truist Securities was not requested to opine as to, and its opinion did not express an opinion as to or otherwise address, among other things: (i) the underlying business decision of the Board, the Company or any other party to proceed with or effect the Merger; (ii) the form, structure or any other portion or aspect of the Merger; (iii) the fairness of any portion or aspect of the Merger to the holders of any class of securities, creditors or other constituencies of the Company or any other party (other than the holders of Company Shares in the manner set forth therein); (iv) the relative merits of the Merger as compared to

 

45

any alternative business strategies that might have existed for the Company or any other party or the effect of any other transaction in which the Company or any other party might have engaged; (v) whether or not the Company, Parent, Merger Sub or any other party was receiving or paying reasonably equivalent value in the Merger; (vi) the fairness of any portion or aspect of the Merger to any one class or group of the Company’s or any other party’s security holders or other constituents vis-à-vis any other class or group of the Company’s or such other party’s security holders or other constituents or the fairness of the allocation of any consideration amongst or within classes or groups of security holders or other constituents; (vii) the solvency, creditworthiness or fair value of the Company or any other participant in the Merger, or any of their respective assets, under any applicable laws relating to bankruptcy, insolvency, fraudulent conveyance or similar matters; or (viii) the fairness, financial or otherwise, of the amount, nature or any other aspect of any compensation or consideration payable to, or received by, any advisors, managers, officers, directors or employees of any party to the Merger, any class of such persons or any other party, relative to the Merger Consideration or otherwise. In addition, Truist Securities did not provide any opinion, counsel or interpretation regarding matters requiring legal, regulatory, accounting, insurance, tax, executive compensation, environmental or other similar professional advice. Truist Securities assumed that any such opinions, counsel or interpretations, to the extent desired by the Board, had been or would be obtained from appropriate professional sources. Furthermore, Truist Securities relied, with the Board’s consent, on the assessments by the Board, the Company and their respective advisors as to all legal, regulatory, accounting, insurance, tax, executive compensation, environmental or other matters with respect to the Company and the Merger.

Truist Securities’ opinion was furnished for the use of the Board (in its capacity as such) in connection with its evaluation of the Merger and may not be used for any other purpose without Truist Securities’ prior written consent. Truist Securities’ opinion is not intended to be, and does not constitute, a recommendation to the Board, the Company, any security holder or any other party as to how to act or vote with respect to any matter relating to the Merger or otherwise.

In performing its analyses, Truist Securities considered business, economic, industry and market conditions, financial and otherwise, and other matters as they existed on, and could be evaluated as of, the date of its opinion. No company, business or transaction used in Truist Securities’ analyses for comparative purposes is identical to the Company or the Merger. The implied valuation reference ranges indicated by Truist Securities’ analyses are illustrative and not necessarily indicative of actual values nor predictive of future results or values, which may be significantly more or less favorable than those suggested by the analyses. In addition, any analyses relating to the value of assets, businesses or securities do not purport to be appraisals or to reflect the prices at which businesses or securities actually may be sold, which may depend on a variety of factors, many of which are beyond the control of the Company and Truist Securities. Much of the information used in, and accordingly the results of, Truist Securities’ analyses are inherently subject to substantial uncertainty.

Truist Securities’ opinion and analyses were provided to the Board in connection with its evaluation of the proposed Merger and were among many factors considered by the Board in evaluating the proposed Merger. Neither Truist Securities’ opinion nor its analyses were determinative of the Merger Consideration or of the views of the Board with respect to the proposed Merger.

The following is a summary of the material financial analyses performed by Truist Securities in connection with its opinion rendered to the Board on November 3, 2025 (which was subsequently confirmed in writing by delivery of Truist Securities’ written opinion dated November 3, 2025). The analyses summarized below include information presented in tabular format. The tables alone do not constitute a complete description of the analyses. Considering the data in the tables below without considering the full narrative description of the analyses, as well as the methodologies underlying, and the assumptions, qualifications and limitations affecting, each analysis, could create a misleading or incomplete view of Truist Securities’ analyses.

For purposes of its analyses, Truist Securities reviewed a number of financial metrics, including:

 

•

Adjusted EBITDA – generally, the amount of the relevant company’s earnings before interest, taxes, depreciation and amortization and stock-based compensation expense for a specified time period, as adjusted for certain non-recurring items.

 

46

•

Enterprise Value – generally, the value as of a specified date of the relevant company’s outstanding equity securities (taking into account outstanding dilutive options and other securities convertible, exercisable or exchangeable into or for equity securities of the company) plus the amount of its net debt (the amount of its outstanding indebtedness, non-convertible preferred stock, capital lease obligations and non-controlling interests less the amount of cash and cash equivalents on its balance sheet).

Selected Companies Analysis

Truist Securities considered certain financial data for selected companies with publicly traded equity securities Truist Securities deemed relevant.

Unless the context indicates otherwise (i) share prices for the selected companies listed below were based on the market price of the common stock of such companies as of October 31, 2025, (ii) the estimates of the future financial performance of the Company were based on the Denny’s Projections, and (iii) the estimates of the future financial performance of the selected companies listed below were based on publicly available research analyst estimates for those companies.

The financial data reviewed included Enterprise Value as a multiple of estimated Adjusted EBITDA for the 2026 fiscal year, or “2026E Adjusted EBITDA.”

The selected companies and the mean, median, low and high financial data were:

 

•

Brinker International, Inc.

 

•

The Cheesecake Factory Incorporated

 

•

Bloomin’ Brands, Inc.

 

•

Dine Brands Global, Inc.

 

•

First Watch Restaurant Group, Inc.

 

•

Cracker Barrel Old Country Store, Inc.

 

•

BJ’s Restaurants, Inc.

 

		Enterprise Value / 2026E Adjusted EBITDA
Mean			6.7x
Median			6.2x
Low			4.6x
High			8.9x

Taking into account the results of the selected companies analysis, Truist Securities applied selected ranges of 6.5x to 7.5x to the Company’s 2026E Adjusted EBITDA. The selected companies analysis indicated an implied value reference range of $4.35 to $5.74 per Company Share, as compared to the Merger Consideration of $6.25 per Company Share in the Merger pursuant to the Merger Agreement.

Selected Transactions Analysis

Truist Securities considered certain financial data for certain transactions involving target companies that Truist Securities deemed relevant. The financial data reviewed included Enterprise Value as a multiple of Adjusted EBITDA for the last twelve months, or “LTM Adjusted EBITDA.”

 

47

The selected transactions and the resulting mean, median, high and low financial data were:

 

Closed Date		Target		Acquiror
Oct-2024		Chuy’s		Darden Restaurants
Jun-2023		Ruth’s Hospitality		Darden Restaurants
Sep-2021		J. Alexander’s Holdings		SPB Hospitality
Sep-2019		Del Frisco’s Restaurant Group		L Catterton
May-2018		Bravo Brio Restaurant Group		Spice Private Equity
Apr-2018		Fogo de Chao		Rhone Capital
Dec-2017		Ruby Tuesday		NRD Capital Management
Feb-2018		Buffalo Wild Wings		Arby’s / Roark Capital
Apr-2017		Bob Evans Restaurants		Golden Gate Capital
Aug-2015		Frisch’s		NRD Capital Management
Jul-2014		Red Lobster		Golden Gate Capital
Feb-2014		CEC Entertainment		Apollo Global Management
Jul-2012		PF Chang’s		Centerbridge
Jul-2011		California Pizza Kitchen		Golden Gate Capital

 

		Enterprise Value / LTM Adjusted EBITDA
Mean			8.1x
Median			7.9x
Low			5.7x
High			12.3x

Taking into account the results of the selected transactions analysis, Truist Securities applied a selected range of 7.0x to 8.0x to the Company’s LTM Adjusted EBITDA for the period ending June 30, 2025. The selected transactions analysis indicated an implied value reference range of $4.87 to $6.24 per Company Share, as compared to the Merger Consideration of $6.25 per Company Share in the Merger pursuant to the Merger Agreement.

Discounted Cash Flow Analysis

Truist Securities performed a discounted cash flow analysis of the Company by calculating the estimated net present value of the projected unlevered, after-tax free cash flows of the Company based on the Denny’s Projections. Truist Securities, taking into account its experience and professional judgment, applied a range of perpetuity growth rates of 2.0% to 3.0% and discount rates ranging from 11.5% to 12.5%. The discounted cash flow analysis indicated an implied value reference range of $5.13 to $7.11 per Company Share, as compared to the Merger Consideration of $6.25 per Company Share in the Merger pursuant to the Merger Agreement. Other Matters

Truist Securities was retained by the Company as its financial advisor based on Truist Securities’ experience and reputation and Truist Securities’ knowledge of the Company and its industry. Truist Securities will receive a fee of approximately $9.3 million for its services to the Company in connection with the Merger, $2.0 million of which became payable upon the delivery of its opinion and the remainder of which is contingent upon the consummation of the Merger. In addition, the Company has agreed to reimburse certain expenses incurred by Truist Securities in connection with its engagement and to indemnify Truist Securities and certain related parties for certain liabilities arising out of its engagement.

Truist Securities and its affiliates (including Truist Bank and Truist Financial Corporation) have provided investment banking and other financial advice and services to the Company and Treville Capital Group (“Treville”), for which advice and services Truist Securities and its affiliates have received compensation, including, among other things, (i) with respect to the Company serving as joint lead arranger and joint

 

48

bookrunner on the Company’s revolving credit facility, for which Truist Securities and its affiliates received aggregate compensation during the prior two years of approximately $2.6 million, and (ii) with respect to Treville, providing certain sales and trading services, for which Truist Securities and its affiliates received aggregate compensation during the prior two years of less than $5,000. Truist Securities and its affiliates may in the future provide investment banking and other financial advice and services to the Company, Parent, TriArtisan Capital Advisors (“TriArtisan”), its subsidiaries and portfolio companies of investment funds affiliated or associated with TriArtisan (collectively, with TriArtisan, the “TriArtisan Group”), Treville, its subsidiaries and portfolio companies of investment funds affiliated or associated with Treville (collectively, with Treville, the “Treville Group”), Yadav Enterprises (“Yadav”), its subsidiaries and portfolio companies of investment funds affiliated or associated with Yadav (collectively, with Yadav, the “Yadav Group” and collectively with the TriArtisan Group and the Treville Group, the “Buyer Group”), and their respective affiliates, or other related parties, for which advice and services Truist Securities and its affiliates would expect to receive compensation. Truist Securities is a full-service securities firm engaged in securities trading and brokerage activities as well as providing investment banking and other financial services. In the ordinary course of business, Truist Securities and its affiliates may acquire, hold or sell, for Truist Securities and its affiliates’ own accounts and the accounts of customers, equity, debt and other securities and financial instruments (including bank loans and other obligations) of the Company, Parent, other members of the Buyer Group, their respective affiliates and other related parties and any other company that may be involved in the Merger, as well as provide investment banking and other financial services to such companies.

Certain Projected Financial Information

The Company, as a matter of course, does not publicly disclose long-term forecasts or internal projections as to future financial performance, earnings, or other results due to, among other reasons, the uncertainty and subjectivity of the underlying assumptions and estimates. However, in connection with the Board’s evaluation of the Merger, the Company’s management provided to Truist Securities and Parent certain unaudited financial information relating to the Company on a standalone basis for the twelve months ended June 25, 2025 (the last day of the Company’s second fiscal quarter of 2025), as well as certain unaudited prospective financial information relating to the Company on a standalone basis for the fiscal years ending December 31, 2025 through December 31, 2029 (such prospective information, the Denny’s Projections). The Denny’s Projections were provided to Truist Securities by the Company for its use and reliance in connection with its financial analyses and opinion, as more fully described in the section entitled “—Opinion of Truist Securities” beginning on page 44.

The summary of the Denny’s Projections below is not included to influence the decision of the Company’s stockholders whether to vote to approve the Merger or any other proposal to be considered at the Special Meeting, but is provided solely because it was made available to the Board and Truist Securities in connection with the Merger. The inclusion of the below information should not be regarded as an indication that any of the Company or its respective advisors or other representatives or any other recipient of this information considered, or now considers, to be necessarily predictive of actual future results, or that it should be construed as financial guidance, and such summary projections set forth below should not be relied on as such.

This information was prepared solely for internal use and is subjective in many respects. While presented with numerical specificity, the Denny’s Projections reflect numerous estimates and assumptions that are inherently uncertain and may be beyond the control of the Company’s management, including, among others, the factors described in the sections entitled “Cautionary Statement Regarding Forward-Looking Statements” and “Where You Can Find More Information.”

The Denny’s Projections were, in the view of the Company’s management, prepared on a reasonable basis and in good faith, reflecting the best available estimates and judgments at the time of preparation. The Denny’s Projections reflect assumptions as to certain business decisions that are subject to change and subjective judgment that is susceptible to multiple interpretations and periodic revisions based on actual experience and

 

49

business developments. The Company can give no assurance that the Denny’s Projections and the underlying estimates and assumptions will be realized. In addition, since the Denny’s Projections cover multiple years, this information by its nature becomes less predictive with each successive year. The Denny’s Projections constitute “forward-looking statements” and actual results may differ materially and adversely from those projected, and important factors that may affect actual results and cause the Denny’s Projections to be inaccurate include, but are not limited to, risks and uncertainties relating to its business, industry performance, general business and economic conditions and other matters described in the sections entitled “Cautionary Statement Regarding Forward-Looking Statements” and “Where You Can Find More Information.”

The Denny’s Projections were not prepared with a view toward public disclosure, nor were they prepared with a view toward compliance with published guidelines of the SEC or the guidelines established by the American Institute of Certified Public Accountants for preparation and presentation of prospective financial information. Further, the Denny’s Projections include non-GAAP financial measures. Non-GAAP financial measures are not prepared in accordance with GAAP and should be considered as a supplement to, not a substitute for, or superior to, the corresponding measures calculated in accordance with GAAP. Due to the inherent limitations of non-GAAP financial measures, Company stockholders should consider non-GAAP measures only as a supplement to, not as a substitute for or as a superior measure to, measures of financial performance prepared in accordance with GAAP. The footnotes to the table below provide certain supplemental information with respect to the calculation of these non-GAAP financial measures.

The Denny’s Projections have been prepared by, and are the responsibility of, the Company’s management. Neither the Company’s independent registered public accounting firm nor any other independent accountants have compiled, examined or performed any procedures with respect to the Denny’s Projections, nor have they expressed any opinion or any other form of assurance on this information or its achievability. The report of the independent registered public accounting firm to the Company contained in its Annual Report on Form 10-K for the year ended December 31, 2024, which is incorporated by reference into this proxy statement, relates to historical financial information of the Company, and that report does not extend to the Denny’s Projections and should not be read to do so.

Furthermore, the Denny’s Projections do not take into account any circumstances or events occurring after the date that the Company’s management prepared them. The Company can give no assurance that, had it prepared the Denny’s Projections as of the date of this proxy statement, it would use similar estimates and assumptions. Except as applicable securities laws require, the Company does not intend to, and disclaims any obligation to, make publicly available any update or other revision to the Denny’s Projections to reflect circumstances existing since its preparation or to reflect the occurrence of unanticipated events, even if any or all of the underlying assumptions are shown to be inappropriate, or to reflect changes in general economic or industry conditions. The Denny’s Projections do not take into account all the possible financial and other effects on the Company of the Merger, the effect on the Company of any business or strategic decision or action that has been or will be taken as a result of the Merger Agreement having been executed, or the effect of any business or strategic decisions or actions that would likely have been taken if the Merger Agreement had not been executed but were instead altered, accelerated, postponed or not taken in anticipation of the Merger. Further, the Denny’s Projections do not take into account the effect on the Company of any possible failure of the Merger to occur. None of the Company or its respective affiliates, officers, directors, advisors or other representatives has made, makes or is authorized in the future to make any representation to any stockholder or other person regarding the Company’s ultimate performance compared to the information contained in the Denny’s Projections or that the forecasted results will be achieved. The inclusion of the Denny’s Projections in this proxy statement should not be deemed an admission or representation by the Company or its respective advisors or other representatives or any other person that it is viewed as material information of the Company, particularly in light of the inherent risks and uncertainties associated with the Denny’s Projections.

In light of the foregoing, and considering that the Special Meeting will be held after the Company prepared the Denny’s Projections, as well as the uncertainties inherent in any forecasted information, Company

 

50

Stockholders are cautioned not to place undue reliance on the Denny’s Projections and are encouraged to review the Company’s most recent SEC filings for a description of the Company’s respective reported financial results. See the section entitled “Where You Can Find More Information.”

Denny’s Projections

The following table sets forth a summary of the Denny’s Projections for the Company, which information was prepared by Company management and reviewed with the Board. The Company authorized Truist Securities to use and rely upon the Denny’s Projections for the Company in connection with its financial analyses and its opinion, as more fully described in the section entitled “—Opinion of Truist Securities.”

The Denny’s Projections for fiscal years 2025-2029 assume an improvement in the overall macroeconomic environment and a corresponding improvement in the restaurant spending patterns of our middle to lower income primary consumer demographic. Additionally, the Denny’s Projections assume that our strategic initiatives including but not limited to a new customer relationship management and loyalty program, new technology platform, and updated remodel image prove to be effective in improving restaurant efficiency and driving guest satisfaction and restaurant visits.

The revenue projections resulting from these assumptions are expected to deliver consistent flat to positive same-store sales and traffic which are planned to deliver margin expansion despite normal commodity inflation of 3% or less and labor inflation of 5% or less. The Denny’s Projections include restaurant expansion within both the Denny’s brand and Keke’s brand which is a significant improvement from our post pandemic performance.

From a capital structure perspective, the Denny’s Projections assume that we can refinance our existing debt at or near existing terms. The Denny’s Projections assume that the operating cash generated will be utilized for primarily for share repurchases and to a much lesser extent, given our highly franchised portfolio, maintaining the positive image of our existing corporate restaurants.

The following unaudited Denny’s Projections should not be regarded as an indication that the Company considered, or now considers, it to be necessarily predictive of actual future performance or events, or that it should be construed as financial guidance, and the Denny’s Projections for the Company do not take into account any circumstances or events occurring after the date it was prepared.

 

						Denny’s Projections (in millions)
		TTM Q2 2025				2025E(1)				2026E				2027E				2028E				2029E
Total Revenue		$	455.7			$	478.2			$	476.1			$	485.6			$	499.9			$	507.4
EBIT (1)		$	40.0			$	40.8			$	45.8			$	49.7			$	50.7			$	56.0
Net Income		$	16.1			$	14.4			$	18.1			$	19.7			$	20.5			$	25.1
Adjusted EBITDA (2)		$	77.6			$	79.9			$	79.0			$	80.0			$	82.4			$	86.9

 

(1)	EBIT defined as Net Income adding back the impacts of Taxes, Interest and Other Nonoperating Expense (Income), net.

(2)

Adjusted EBITDA defined as Net Income adding back the impacts of Taxes, Interest, Other Nonoperating Expense (Income), net, Goodwill Impairment Charges, Operating (Gains) Losses, net, Shared Based Compensation, Deferred Compensation Plan Valuation Adjustments, Depreciation and Amortization, Non-Recurring Legal Settlements, Pre-Opening Expenses and Other Adjustments.

 

		Denny’s Projections (in millions)
		Six Months Ending 12/31/25E(1)				2026P				2027P				2028P				2029P
Unlevered Free Cash Flow		$	24.4			$	55.5			$	61.7			$	60.5			$	63.8

 

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(1)

The estimated results for full-year 2025 (and in the case of unlevered free cash flow, for the remaining portion of 2025) were updated in August 2025 (as compared to those prepared and provided to the Board and Parent in April 2025) solely to take into account the Company’s actual performance for the second quarter of 2025.

The projected results for years 2026 – 2029 were not adjusted.

The adjustments were as follows (in millions): Revenue was adjusted from $473.4 to $478.2; EBIT from $45.0 to $40.8; net income from $18.8 to $14.4; adjusted EBITDA from $83.0 to $79.9; and unlevered free cash flow from $45.5 for the nine months ending December 31, 2025 to $24.4 for the six months ending December 31, 2025.

Interests of Denny’s Corporation Directors and Executive Officers in the Merger

You should be aware that the Company’s directors and executive officers may have certain interests in the Merger that may be different from, or in addition to, the interests of the Company’s stockholders more generally, including (a) the accelerated vesting, cancellation and cash-out of Company RSU Awards and Company PSU Awards in connection with the Merger, as described in more detail in the section titled “Interests of Denny’s Corporation Directors and Executive Officers in the Merger—Treatment of Company Equity Awards,” (b) the entitlement of executive officers to receive severance payments and other benefits pursuant to the Severance Plan (as defined below) in the event of certain terminations of employment in connection with, or following, the Merger, which for purposes of such Severance Plan constitutes a “change in control”, as described in more detail in the section titled “Interests of Denny’s Corporation Directors and Executive Officers in the Merger—Potential Change in Control and Severance Entitlements to the Company’s Executive Officers,” and (c) the entitlement of certain executive officers to a lump sum payment in respect of their notional accounts under the Company’s Deferred Compensation Plan, as amended and restated, as described in more detail in the section titled “Interests of Denny’s Corporation Directors and Executive Officers in the Merger—Nonqualified Deferred Compensation Plan.”

The Board was aware of these interests and considered them, among other matters, in (1) evaluating and negotiating the Merger Agreement, (2) approving the Merger Agreement and the Merger, and (3) recommending that the Merger Agreement Proposal be approved by the Company’s stockholders. These interests are described below.

For the purposes of this disclosure (as to which applicable SEC disclosure rules require the Company to list all persons who have served as an executive officer of the Company since January 1, 2024, the beginning of the Company’s last completed fiscal year), the Company’s executive officers are:

 

•

Christopher D. Bode, President and Chief Operating Officer, Denny’s, Inc.;

 

•

Stephen C. Dunn, Executive Vice President and Chief Global Development Officer;

 

•

Jay C. Gilmore, Senior Vice President, Chief Accounting Officer and Corporate Controller;

 

•

Minh Le, Senior Vice President and Chief Technology Officer;

 

•

Gail E. Sharps Myers, Executive Vice President, Chief Legal & Administrative Officer and Corporate Secretary;

 

•

Pankaj K. Patra; Former Chief Technology Officer (Mr. Patra left the Company in 2024);

 

•

Monigo G. Saygbay-Hallie, Executive Vice President and Chief People Officer;

 

•

David P. Schmidt, President, Keke’s, Inc.;

 

•

Kelli F. Valade, Chief Executive Officer; and

 

•

Robert P. Verostek, Executive Vice President and Chief Financial Officer.

 

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For the purposes of this disclosure, the Company’s non-employee directors as of the date hereof are Olu Beck, Bernadette S. Aulestia, Gregg R. Dedrick, José M. Gutiérrez, John C. Miller, and Mark R. Vondrasek. In addition, Brenda J. Lauderback and Laysha Ward served as non-employee directors of the Company through its 2025 annual meeting of stockholders, and are required to be listed here by applicable SEC disclosure rules.

Treatment of Shares of Common Stock

Each of the Company’s directors and executive officers who own shares of Common Stock will be entitled to receive, for each share of Common Stock held by such individual, the Merger Consideration on the same terms and conditions as other Company stockholders. For information regarding the treatment of shares of Common Stock held by each of the Company’s directors and executive officers, see the section titled, “The Merger Agreement—Merger Consideration,” beginning on page 74.

The following table sets forth the number of shares of Common Stock owned, as of November 14, 2025 by each of the Company’s executive officers and non-employee directors (which, for this purpose, excludes shares subject to outstanding and unvested Company RSU Awards and Company PSU Awards, which are, in each case, described further below).

 

Name		Shares Owned (#)				Value of Shares Owned ($)(1)
Executive Officers
Kelli F. Valade			192,806				1,205,038
Robert P. Verostek (2)			95,148				594,675
Gail E. Sharps Myers			71,257				445,356
David P. Schmidt			39,417				246,356
Christopher D. Bode			10,186				63,663
Pankaj K. Patra			0				0
Stephen C. Dunn			113,666				710,413
Jay C. Gilmore			129,984				812,400
Minh Le			0				0
Monigo Saygbay-Hallie			1,050				6,563
Non-Employee Directors
Olu Beck			11,145				69,656
Bernadette S. Aulestia			0				0
Gregg R. Dedrick			104,991				656,194
José M. Gutiérrez			75,844				474,025
John C. Miller			766,634				4,791,463
Mark R. Vondrasek			0				0
Brenda J. Lauderback			116,777				729,856
Laysha Ward			167,273				1,045,456

 

(1)	The values in the table below have been determined based on the Merger Consideration of $6.25 per share of Common Stock.

(2)	The number of shares included in this amount is the 24,000 shares held indirectly by Mr. Verostek’s wife.

Treatment of Company Equity Awards

Pursuant to the Merger Agreement, effective as of immediately prior to the Effective Time, (i) each Company RSU Award (including each deferred stock unit award granted to the Company’s non-employee directors) that is outstanding immediately prior to the Effective Time will be cancelled and converted automatically into the right to receive from the Surviving Company an amount in cash (without interest and less any applicable withholding taxes), equal to the product of (A) the aggregate number of Company Shares

 

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underlying such Company RSU Award, multiplied by (B) the Merger Consideration, and (ii) each Company PSU Award that is outstanding immediately prior to the Effective Time will be cancelled and converted into a right to receive from the Surviving Company an amount in cash (without interest and subject to applicable withholding taxes), equal to the product of (A) the aggregate number of Company Shares underlying such Company PSU Award (with such number of Company Shares determined in accordance with the terms of the applicable award agreement pursuant to which such Company PSU Award was granted (and without discretionary adjustment by the Company Board (or a committee thereof))), multiplied by (B) the Merger Consideration. Payment in respect of such Company RSU Awards and Company PSU Awards will be made to each holder thereof no later than the next regularly scheduled payroll date that is at least five business days following the Effective Time (or, to the extent any amount constitutes deferred compensation, as soon as permissible under Section 409A of the Code). Note that any Company PSU Award that is unvested as of immediately prior to the Effective Time in accordance with the terms of the applicable award agreement pursuant to which it was granted will automatically be cancelled without further action and for no consideration. See the section of this proxy statement titled “Summary—Treatment of Equity Awards and the Denny’s Corporation Equity Plans” beginning on page 5.

The following table sets forth, for each of the Company’s executive officers and directors, the aggregate number of unvested Company RSU Awards (including deferred stock units) and Company PSU Awards held as of November 14, 2025, together with the estimated value the executive officers and directors will receive in respect of such Company RSU Awards and Company PSU Awards in connection with the Merger assuming the closing of the Merger occurs on November 14, 2025. The treatment of the Company RSU Awards and Company PSU Awards is considered to be “single trigger” (i.e., amounts triggered solely by a change in control).

The values in the table below have been determined based on the Merger Consideration of $6.25 per share of Common Stock and assume a performance level for each Company PSU Award as noted below. Actual amounts may differ from the amounts set forth below.

 

Name(1)		Company RSU Awards (#)				Estimated Value of Company RSU Awards ($)(2)				Company PSU Awards (#)				Estimated Value of Company PSU Awards ($)(3)				Total Estimated Cash Consideration for Unvested PSU Awards and Company RSU Awards in the  Merger ($)
Non-Employee Directors:
Bernadette S. Aulestia			24,775				154,844				—				—				154,844
Olu Beck			37,162				232,263				—				—				232,263
Gregg R. Dedrick			24,775				154,844				—				—				154,844
José M. Gutiérrez			24,775				154,844				—				—				154,844
Brenda J. Lauderback			—				—				—				—				—
John C. Miller			24,775				154,844				—				—				154,844
Mark R. Vondrasek			24,775				154,844				—				—				154,844
Laysha Ward			—				—				—				—				—
Executive Officers:
Kelli F. Valade			386,289				2,414,306				462,850				2,892,813				5,307,119
Robert P. Verostek			104,087				650,544				124,720				779,500				1,430,044
Gail E. Sharps Myers			99,876				624,225				119,537				747,106				1,371,331
David P. Schmidt			115,686				723,038				138,015				862,594				1,585,632
Christopher D. Bode			181,148				1,132,175				124,403				777,519				1,909,694
Pankaj K. Patra			—				—				—				—				—
Stephen C. Dunn			70,066				437,913				114,273				714,207				1,152,120
Jay C. Gilmore			52,851				330,319				63,170				394,810				725,129
Minh Le			28,013				175,081				40,281				251,758				426,839
Monigo Saygbay-Hallie			66,195				413,719				59,240				370,249				783,968

 

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(1)

The amounts in this table reflect the unvested shares of Common Stock underlying the Company RSU Awards and Company PSU Awards held by such individuals as of November 14, 2025. Payment in respect of any Company PSU Awards that were deferred under the Company’s Deferred Compensation Plan will be distributed pursuant to the terms thereunder (as described in the section titled “Nonqualified Deferred Compensation Plan” below) and are therefore excluded from this table.

 

(2)

The value of the Company RSU Awards reported for the non-employee directors includes the value of outstanding and unvested deferred stock units granted to and deferred by each non-employee director in 2025. The value of any outstanding and vested deferred stock units held by non-employee directors in respect of the 2023 and 2024 fiscal years are not accounted for in the above table.

 

(3)	The Company PSU Award values in the table above assumes performance achievement by award as follows:

 

Award		Achievement % of Company PSU Award
2023 LTIP - EPS			100	%
2023 LTIP - TSR			59.8	%
2024 LTIP - TSR			0.0	%
2025 LTIP - TSR			143.8	%

Potential Change in Control and Severance Entitlements to the Company’s Executive Officers

The Company maintains the Denny’s Corporation Executive Severance Pay Plan, effective as August 20, 2023 (the “Severance Plan”). Pursuant to the Severance Plan, each of the executive officers of the Company are eligible to receive the following benefits (collectively, the “Severance Benefits”) upon a termination of employment by the Company without “cause” or a voluntary resignation by the executive for “good reason,” as such terms are defined in the Severance Plan, occurring either (1) within two years following the occurrence of a change in control (as defined in the Severance Plan), which includes the Merger or (2) prior to the occurrence of a change in control, if the executive officer can reasonably demonstrate that such termination without cause or condition constituting good reason, as applicable, occurred at the request of a third party who had taken steps reasonably calculated to effect the change in control (each, a “Qualifying Termination”):

 

•

A lump sum cash severance benefit equal to the aggregate of: (i) a pro rata bonus determined based on the greater of the executive’s target annual bonus for the year in which the change in control occurs or the executive’s target annual bonus for the year in which the termination date occurs; (ii) a payment equal to 2.0 times the sum of the executive’s (x) highest rate of annual base salary during the three year period immediately prior to the date of termination and (y) the greater of the executive’s annual target bonus for the year in which the change in control occurs or the executive’s target annual bonus for the year in which the termination date occurs; (iii) a payment equal to the cost of providing certain continued health and welfare benefits for a period of 24 months following the Qualifying Termination; and

 

•

Outplacement services up to $20,000 over a period not to exceed 12 months following the date of termination, so long as that the executive provides written notice to the Company within six months following the termination date of the executive’s intention to utilize such outplacement services.

In addition to the above Severance Benefits, in the event of an executive’s Qualifying Termination, any outstanding equity or incentive awards held by the executive will continue to be governed by the terms of the applicable equity plan and award agreement, and the executive will receive payment of any accrued but unearned amounts, benefits, and vacation pay. Note that although the Severance Plan provides that equity awards will continue to be governed by the terms of the applicable equity plan and award agreement, all outstanding Company RSU Awards and Company PSU Awards will be cancelled and converted into a right to receive a cash payment as described above.

 

55

The Severance Benefits described above are subject to, among other things, the executive officer’s timely execution and non-revocation of a general release of claim in favor of the Company and related parties, and execution and compliance with post-employment restrictive covenants including a perpetual restriction on disclosing Company trade secrets, a perpetual confidentiality and non-disparagement obligation, and one-year post-employment restrictions against competition, solicitation of employees, and interference with the Company’s business relationships.

Each of the executive officers participate in the Severance Plan.

It is currently estimated that the executive officers (other than former executive officer Pankaj K. Patra) would be entitled to receive, in the aggregate, approximately $6,827,690 in cash severance benefits (inclusive of $20,000 in outplacement services) under the Severance Plan, assuming each of the executive officers experiences a Qualifying Termination on November 14, 2025.

For a more detailed estimate of the value of the severance payments to each named executive officer upon a Qualifying Termination under the Severance Plan in connection with the Merger, see the section titled, “—Quantification of Payments and Benefits” below.

Nonqualified Deferred Compensation Plan

Certain of the Company’s executive officers participate in the Denny’s, Inc. Deferred Compensation Plan, as amended and restated (the “Deferred Compensation Plan”). The Deferred Compensation Plan, which is now frozen to new deferrals, historically allowed eligible executive officers to defer up to 50% of their base salary, 75% of their annual bonus, and 100% of their earned Company PSU Awards. The Company may make discretionary contributions on behalf of participants in the Deferred Compensation Plan, and the Company makes matching contributions to the Deferred Compensation Plan.

In connection with the Merger, the Company will terminate the Deferred Compensation Plan, in which case each executive’s account held thereunder will be distributed to the respective executive in a lump sum payment on the first day of the month following the closing of the Merger (or, with respect to deferred Company PSU Awards, within 30 days following the closing of the Merger).

The following table sets forth the value of each executive officer’s account under the Deferred Compensation Plan.

 

Name		Account Balance ($)
Kelli F. Valade			0
Robert P. Verostek			298,198
Gail E. Sharps Myers			0
David P. Schmidt			0
Christopher D. Bode			0
Pankaj K. Patra			0
Stephen C. Dunn			2,748,325
Jay C. Gilmore			286,384
Minh Le			0
Monigo Saygbay-Hallie			0

The value of each named executive officer’s account under the Deferred Compensation Plan is included in the table listed under “Quantification of Payments and Benefits” below.

Section 280G Mitigation Actions

In connection with the Merger, certain employees of the Company (including its executive officers) may become entitled to payments and benefits that may be treated as “excess parachute payments” within the meaning

 

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of Section 280G of the Code. The Company, in consultation with Parent, may engage in certain mitigation strategies prior to January 1, 2026 to reduce the potential impact of Section 280G and Section 4999 of the Code, including accelerating vesting of the portion of an executive’s equity awards that would otherwise vest in 2025 and paying any portion of the annual bonus that is expected to be payable to the executive in 2026 in respect of 2025. No executive officer is entitled to a tax gross-up for any “golden parachute” excise tax under Section 4999 of the Code. In the event that the severance benefits under the Severance Plan would be subject to the “golden parachute” excise tax under Section 4999 of the Code, the executive’s payments will be either: (1) the full amount of the payments or (2) the lesser amount that would ensure that no portion of the payments would be subject to the excise tax, whichever would put the executive in the best net position after tax, as determined by an independent auditor.

Annual Bonus for Fiscal Year 2025

If the closing of the Merger occurs prior to the payment of annual bonuses, each executive officer who is eligible to participate in the Company’s annual cash incentive plan will be eligible to receive, no later than February 28, 2026, payment of an amount that would be payable under such annual cash incentive plan based on (i) actual performance of the performance goals for fiscal year 2025 through the closing of the Merger, and (ii) target performance for the period between the closing of the Merger and December 31, 2025, prorated for the period between January 1, 2025 and the closing of the Merger and subject to the executive officer remaining employed through the Closing. Upon a termination without “cause” under the Severance Plan prior to or on December 31, 2025, the executive officer will be entitled to receive such prorated bonus (subject to executing a release of claims) promptly following the effective date of such release (provided that such executive officer will be entitled to receive any greater pro rata annual bonus amount under the Severance Plan without duplication of the officer’s Pro-Rated 2025 Bonus.)

Indemnification Insurance

Pursuant to the terms of the Merger Agreement, each of the Company’s current or former directors and executive officers will be entitled to certain ongoing indemnification and insurance coverage for a period of not less than six years following the Effective Time, as further described in the section titled, “The Merger Agreement—Indemnification, Exculpation and Insurance.”

Quantification of Payments and Benefits

This section sets forth the information required by Item 402(t) of Regulation S-K regarding the compensation of each of the Company’s named executive officers that is based on or otherwise relates to the Merger and that will or may become payable to the named executive officers at the completion of the Merger or on a Qualifying Termination following the consummation of the Merger. Applicable SEC disclosure rules refer to this compensation as “golden parachute” compensation, and in this section, we use such term to describe the Merger-related compensation payable to the Company’s named executive officers.

The amounts shown in the table below are estimates based on various assumptions that may or may not actually occur or be accurate on the relevant date, including the assumptions described below and in the footnotes to the table, and do not reflect certain compensation actions that may occur before the completion of the Merger. As a result, the actual amounts, if any, that a named executive officer receives may materially differ from the amounts set forth in the table.

For purposes of this disclosure, the Company’s named executive officers as of the date hereof are Kelli F. Valade, Robert P. Verostek, Gail E. Sharps Myers, David P. Schmidt, and Christopher D. Bode.

The following table assumes that:

 

•

the relevant price of a share of Common Stock is $6.25 (which is the Merger Consideration);

 

57

•

the Effective Time will occur on November 14, 2025 (which is the latest practicable date to determine the amounts set forth in the table below before the filing of this proxy statement);

 

•

no named executive officer will receive any additional, or forfeit any, equity or equity-based awards prior to the Effective Time;

 

•

each named executive officer experiences a Qualifying Termination immediately following the Effective Time and receives severance payments and benefits as described in the Severance Plan;

 

•

the named executive officers have each timely executed and not revoked a release of claims; and

 

•

the named executive officers’ base salaries and target annual bonus opportunities will remain unchanged from those in place as of November 14, 2025.

The table below excludes any payments or benefits that would have been earned, or any amounts associated with Company RSU Awards or Company PSU Awards that would vest according to their terms on or prior to the Effective Time and irrespective of the Merger. The values and descriptions also (1) do not reflect amounts under contracts, agreements, plans, or arrangements to the extent that they do not discriminate in scope, terms, or operation in favor of the named executive officers and that are generally available to all salaried employees of the Company (2) do not reflect applicable tax withholdings that are applicable to any of the payments set forth in the table, and (3) assumes that no payments are subject to reduction to the extent required by the terms of the applicable agreement to account for the application of Sections 280G and 4999 of the Code to such payments.

 

Name		Cash ($) (1)				Equity ($) (2)				Pension/ NQDC ($) (3)				Perquisites & Benefits ($) (4)				Tax Reimbursement ($) (5)				Total ($) (6)
Kelli F. Valade			4,680,475				5,307,121				0				58,805				0				10,046,402
Robert P. Verostek			2,336,209				1,430,044				298,198				64,142				0				4,128,594
Gail E. Sharps Myers			2,244,277				1,371,331				0				57,258				0				3,672,867
David P. Schmidt			2,384,654				1,585,632				0				48,976				0				4,019,262
Christopher D. Bode			2,806,392				1,909,693				0				65,177				0				4,781,261

 

(1)

The cash severance represents the amount payable pursuant to the Severance Plan, which is described above in the section titled, “Potential Change in Control and Severance Entitlements to the Company’s Executive Officers.” The amounts included in this column are considered to be “double trigger” (i.e., amounts triggered by a change in control for which payment is conditioned upon a Qualifying Termination). A Qualifying Termination is a termination of employment by the Company without “cause” or a voluntary resignation by the named executive officer for “good reason,” as such terms are defined in the Severance Plan, occurring either (1) within two years following the occurrence of a change in control (as defined in the Severance Plan), which includes the Merger, or (2) prior to the occurrence of a change in control, if the named executive officer can reasonably demonstrate that such termination occurred at the request of a third party who had taken steps reasonably calculated to effect the change in control. The estimated amount of each such payment included in the “cash” column above is set forth in the table below. Note that the cash severance, bonus target and prorated bonus amounts included in the table below were determined based on the executives’ base salary and target annual bonus for the 2025 fiscal year, prorated as of November 14, 2025. An executive’s receipt of severance is contingent on the executive’s execution and non-revocation of a general release of claims in favor of the Company and related parties. Executives must also execute and comply with post-employment restrictive covenants including a perpetual restriction on disclosing Company

 

58

trade secrets, a perpetual confidentiality and non-disparagement obligation, and one-year post-employment restrictions against competition, solicitation of employees, and interference with the Company’s business relationships.

 

Name		Base Cash Severance				Bonus Target				Prorated Bonus				Total Cash
Kelli F. Valade			1,921,680				1,921,680				837,115				4,680,475
Robert P. Verostek			1,087,371				869,897				378,941				2,336,209
Gail E. Sharps Myers			1,044,582				835,666				364,030				2,244,277
David P. Schmidt			1,040,400				936,360				407,894				2,384,654
Christopher D. Bode			1,224,400				1,101,960				480,032				2,806,392

 

(2)

Amounts shown reflect the potential value that each named executive officer could receive in connection with treatment of outstanding and unvested Company RSU Awards and Company PSU Awards held by such named executive officers in connection with the Merger. See the section titled, “Summary—Treatment of Equity Awards and the Denny’s Corporation Equity Plans” beginning on page 5. Payment in respect of deferred Company PSU Awards under the Company’s Deferred Compensation Plan will be distributed pursuant to the terms thereunder (as described in the section titled Interests of Denny’s Corporation Directors and Executive Officers in the Merger—Nonqualified Deferred Compensation Plan) and are therefore excluded from this table. The treatment of the outstanding Company RSU Awards and Company PSU Awards is considered to be “single trigger” (i.e., amounts triggered solely by a change in control). The estimated amount of each such payment included in the “Equity” column above is set forth in the table below.

 

Name		Estimated Value of Company RSU Awards ($)				Estimated Value of Company PSU Awards ($)				Total Estimated Value of Equity ($)
Kelli F. Valade			2,414,306				2,892,814				5,307,121
Robert P. Verostek			650,544				779,501				1,430,044
Gail E. Sharps Myers			624,225				747,106				1,371,331
David P. Schmidt			723,038				862,594				1,585,632
Christopher D. Bode			1,132,175				777,518				1,909,693

The value of Company PSU Awards reflected in the tables above assumes performance achievement as follows:

 

Award		Achievement % of Company PSU Award
2023 LTIP - EPS			100	%
2023 LTIP - TSR			59.8	%
2024 LTIP - TSR			0.0	%
2025 LTIP - TSR			143.8	%

 

(3)

Amounts shown represent the value of the lump sum payment equal to the named executive officer’s notional account balance under the Deferred Compensation Plan, which becomes payable in connection with the Merger. The amounts under the Deferred Compensation Plan are fully vested in the ordinary course, but the termination of the Deferred Compensation Plan in connection with the Merger will accelerate the distribution of such amounts, and the payment of such amounts is considered to be “single trigger.” See section titled Interests of Denny’s Corporation Directors and Executive Officers in the Merger—Nonqualified Deferred Compensation Plan.

(4)	Amounts shown reflect an aggregate payment equal to the cost of providing continued health and welfare benefits for a period of 24 months and up to $20,000 of outplacement services pursuant to the Severance

 

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Plan for a period of 12 months following termination, in each case as described in more detail above in section titled “Potential Change in Control and Severance Entitlements to the Company’s Executive Officers.” The amounts included in this column are considered to be “double trigger”. The estimated amount of each component included in this column is set forth in the table below.

 

Name		Estimated Cost of Medical Benefits ($)				Estimated Cost of Dental Benefits ($)				Estimated Cost of Vision Benefits ($)				Cost of Outplacement Services ($)				Total Estimated Value of Health and Welfare ($)
Kelli F. Valade			35,578				2,645				582				20,000				58,805
Robert P. Verostek			40,915				2,645				582				20,000				64,142
Gail E. Sharps Myers			36,046				848				364				20,000				57,258
David P. Schmidt			27,764				848				364				20,000				48,976
Christopher D. Bode			43,635				1,542				0				20,000				65,177

 

(5)

None of the named executive officers is, or will be, entitled to a tax reimbursement in connection with the Merger or a tax gross-up for any “golden parachute” excise tax under Section 4999 of the Code. In the event that the severance benefits under the Severance Plan would be subject to the “golden parachute” excise tax under Section 4999 of the Code, the executive’s payments will be either: (1) the full amount of the payments or (2) the lesser amount that would ensure that no portion of the payments would be subject to the excise tax, whichever would put the executive in the best net position after tax, as determined by an independent auditor. The amounts shown in this table do not reflect any such reduction.

Other Arrangements

Prior to the Effective Time, the Company, Parent, or their respective affiliates may, in their discretion, continue or initiate, as applicable, discussions regarding agreements, arrangements, and understandings with one or more of the Company’s named executive officers regarding their employment or other future services, compensation or benefits, or co-investment opportunities and may enter into definitive agreements with such individuals regarding the foregoing (including the terms of any participation in a post-closing equity compensation program), subject to the interim operating covenants set forth in the Merger Agreement and applicable restrictions therein.

Continuing Employee Benefits

The Merger Agreement provides that each individual employed by Parent, the Surviving Company or any of their respective affiliates on and after the Effective Time (or if sooner, the date that such individual’s employment terminates) will, for a period of one year following the Closing Date, be entitled to (i) a base salary or wage rate and a target short-term incentive cash compensation opportunity that, in each case, is no less favorable than that provided to the individual immediately prior to the Effective Date, (ii) severance benefits and protections that are no less favorable than the severance benefits such that individual is eligible to receive under the applicable severance plan of the Company, including, if applicable, the Severance Plan, and (iii) broad-based retirement and health and welfare benefits (excluding certain excluded benefits as described in the Merger Agreement) that are substantially similar in the aggregate to those provided to the employees of the Company immediately prior to the Effective Time.

Financing the Merger

The Merger is not subject to any financing condition. Parent estimates that the total funds necessary to complete the Merger and pay the Merger Consideration will be approximately $640 million, including the amounts necessary to (i) pay the aggregate Merger Consideration and the other amounts required to be paid by Parent or Merger Sub in connection with the consummation of the Transactions; (ii) pay all related fees, costs and expenses incurred by Parent in connection with the Transactions; and (iii) repay certain indebtedness of the

 

60

Company, as contemplated by the Merger Agreement. Parent expects these amounts to be funded through a combination of (i) an equity commitment of up to $220 million, (ii) committed senior secured term loan financing in an aggregate amount of $300 million, and (iii) proceeds of a sale/leaseback transaction of up to approximately $146.8 million.

Equity Financing

Parent has delivered to the Company the Equity Commitment Letter, pursuant to which TriArtisan Capital Advisors has agreed to make, or cause to be made, an equity investment in Parent, on the terms and subject to the conditions set forth therein, in the aggregate amount of up to $220 million in cash.

The obligation of TriArtisan Capital Advisors to provide the Equity Financing under the Equity Commitment Letter is subject to a number of conditions, including, but not limited to: (i) execution and delivery of the Merger Agreement by the Company; (ii) satisfaction or waiver by Parent of each of the conditions to Parent’s and Merger Sub’s obligations to consummate the Merger as set forth in the Merger Agreement (other than conditions to be satisfied at the Closing, subject to their prior or substantially concurrent satisfaction or waiver); (iii) the substantially contemporaneous funding in full of the debt financing contemplated by the Debt Commitment Letter (or, if Alternative Financing (as defined in Merger Agreement) is being used in accordance with the Merger Agreement, the cash proceeds of such Alternative Financing) and receipt of the proceeds of the transactions contemplated by Sale/Leaseback Purchase and Sale Agreement; and (iv) the substantially simultaneous consummation of the Merger in accordance with the Merger Agreement.

The Company is an express third-party beneficiary of the Equity Commitment Letter solely with respect to the right, on the terms and subject to certain conditions of the Merger Agreement and the Equity Commitment Letter, to cause Parent to enforce TriArtisan Capital Advisors’ obligations thereunder. See the section entitled “The Merger Agreement—Financing; Financing Cooperation,” beginning on page 93.

The obligations of TriArtisan Capital Advisors in respect of the Equity Commitment Letter will terminate upon the earliest to occur of: (i) the funding of the amount committed to by TriArtisan Capital Advisors under the Equity Commitment Letter at the Closing in accordance with the Merger Agreement; (ii) the valid termination of the Merger Agreement in accordance with its terms (provided, that any claim made under the Equity Commitment Letter prior to such termination shall survive until finally resolved); (iii) payment in full of the Parent Termination Fee pursuant to the Merger Agreement; and (iv) the Company or any of its affiliates (or any person acting at the direction of the foregoing) asserting any claim against TriArtisan Capital Advisors or certain other non-recourse parties other than certain retained claims permitted under the Limited Guarantee.

In connection with the Equity Commitment Letter, TriArtisan Capital Advisors and certain other parties (the “Additional Investors”) have entered or will enter into an interim investors agreement (the “Interim Investors Agreement”) whereby each Additional Investor will commit to TriArtisan Capital Advisors to fund its respective portion of the Equity Financing.

The Interim Investors Agreement provides, among other things, that TriArtisan Capital Advisors and the Additional Investors are permitted to syndicate their respective equity commitments to third party co-investors, which third party co-investors will be required to become a party to the Interim Investors Agreement. No such syndication will relieve TriArtisan Capital Advisors and its affiliates of its commitment pursuant to the Equity Commitment Letter or the Additional Investors’ respective commitments pursuant to the Interim Investors Agreement.

Debt Financing

A wholly owned, indirect subsidiary of Parent has received the executed Debt Commitment Letter from the Debt Financing Sources, pursuant to which such Debt Financing Sources have committed to provide debt

 

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financing in an aggregate amount of $335 million, consisting of a $300 million senior secured term loan facility and a $35 million senior secured revolving credit facility, subject to the conditions set forth therein.

The obligations of the Debt Financing Sources to provide the debt financing under the Debt Commitment Letter are subject to certain customary conditions, including, but not limited to: (i) prior to or substantially simultaneously with the initial borrowing under the debt facilities, the consummation of the Merger in all material respects in accordance with the Merger Agreement (without any modifications, amendments, consents or waivers to the Merger Agreement that are materially adverse to the interests of the Debt Financing Sources without the consent of the Debt Financing Sources (such consent not to be unreasonably withheld, delayed or conditioned)), (ii) since the date of the Merger Agreement, there shall not have occurred any circumstance, occurrence, effect, fact, condition, change, event or development that has had or would reasonably be expected to have a Denny’s Material Adverse Effect (as defined in the section entitled “The Merger Agreement—Representations and Warranties”), (iii) substantially simultaneously with the initial borrowing under the debt facilities and the consummation of the Merger, the repayment in full of, and termination and release of all commitments, security interests and guaranties in connection with, the Credit Agreement, dated as of August 26, 2021, among Denny’s Corporation, Denny’s, Inc., the guarantors party thereto, the lenders party thereto and Wells Fargo Bank, National Association, as administrative agent, (iv) the execution and delivery of the definitive documentation with respect to the senior secured facility, together with customary closing deliverables, (v) the execution and delivery of certain facilities documentation including, subject to documentation considerations and limited conditionality provisions, specified security and collateral documentation, (vi) payment of all fees and expenses of the Debt Financing Sources required to be paid on the closing date under the Debt Commitment Letter, (vii) prior to the closing date, receipt by the Debt Financing Sources of certain financial information and other information required by regulatory authorities under applicable “know your customer” and anti-money laundering rules and regulations and, if applicable, a beneficial ownership certification, (viii) prior to or substantially simultaneously with the initial borrowing under the debt facilities and the consummation of the Merger, the Equity Financing and the Sale/Leaseback Transaction shall have been consummated and (ix) the accuracy in all material respects of certain representations and warranties in the Merger Agreement and in the definitive documentation with respect to the debt facilities.

The obligations of the Debt Financing Sources in respect of the Debt Commitment Letter will terminate upon the earliest to occur of: (i) the consummation of the Merger, (ii) the termination of the Merger Agreement by Parent in a signed writing in accordance with its terms (or in a written conformation of public announcement thereof), (iii) the consummation of the Merger without the funding or effectiveness of the debt facilities contemplated by the Debt Commitment Letter and (iv) 11:59 p.m., New York City time, on July 8, 2026.

Pursuant to the Merger Agreement, Parent has agreed to cause its applicable subsidiary to use its reasonable best efforts to, among other things, arrange and obtain the debt financing on the terms and subject to the conditions described in the Debt Commitment Letter (and, in certain circumstances, alternative financing from alternative sources, on terms and conditions that in the aggregate are not less favorable to borrower), and the Company agreed to use its reasonable best efforts to, and will cause its subsidiaries and its and their respective representatives to use their reasonable best efforts to, subject to certain exceptions, cooperate with Parent, at Parent’s sole cost and expense, in connection with the arrangement and consummation of the debt financing contemplated by the Debt Commitment Letter. See the section entitled “The Merger Agreement—Financing; Financing Cooperation,” beginning on page 93.

Sale/Leaseback Transaction

Pursuant to the Sale/Leaseback Purchase and Sale Agreement, substantially concurrent with closing of the Merger, the sale/leaseback purchaser thereunder has agreed to provide financing in the form of sale/leaseback transactions involving certain of the Company’s owned real property assets for up to approximately $146.8 million. The Sale/Leaseback Transaction will involve the conveyance of approximately 75 properties and the immediate lease back of 16 of such properties to the Company (which 16 properties are currently operated by the Company).

 

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The sale/leaseback purchaser has the right to remove up to five properties (which properties shall have a total allocated value not to exceed $12.5 million in the aggregate) from the conveyance contemplated by the Sale/Leaseback Purchase and Sale Agreement if the results of its due diligence review of the property are unsatisfactory. Further, in the event of a breach by Merger Sub of the Sale/Leaseback Purchase and Sale Agreement or a failure of a condition precedent to the completion of the transactions contemplated by the Sale/Leaseback Purchase and Sale Agreement, the sale/leaseback purchaser has the right to remove up to an additional five properties from the conveyance contemplated by the Sale/Leaseback Purchase and Sale Agreement. In the event such breach or conditions precedent affect more than five properties, the sale/leaseback purchaser has the right to terminate the Sale/Leaseback Purchase and Sale Agreement.

The Sale/Leaseback Purchase and Sale Agreement includes customary closing conditions, including, but not limited to, (i) accuracy of the representations and warranties set forth in, and satisfaction of the covenants set forth in, the Sale/Leaseback Purchase and Sale Agreement in all material respects, (ii) execution of a Master Lease Agreement in the form attached to the Sale/Leaseback Purchase and Sale Agreement, (iii) delivery of customary closing documents, and (iv) execution of amendments with respect to certain franchisee subleases. Forty-four out of the 49 sublease amendments required to be delivered for closing were delivered prior to execution of the Sale/Leaseback Purchase and Sale Agreement.

Pursuant to the Merger Agreement, Parent has agreed to cause its applicable subsidiary to use its reasonable best efforts to, among other things, consummate the Sale/Leaseback Transaction; and the Company agreed to use its reasonable best efforts to provide, subject to certain exceptions, customary cooperation to Merger Sub, in each case at Parent’s sole cost and expense in connection with the consummation of the Sale/Leaseback Transaction. See the section entitled “The Merger Agreement—Sale/Leaseback Transaction,” beginning on page 97.

Limited Guarantee

Pursuant to the Limited Guarantee, TriArtisan Capital Advisors has agreed to guarantee the due and punctual payment of the obligations of Parent in respect of: (i) the Parent Termination Fee, if and when payable pursuant to the Merger Agreement; and (ii) certain other obligations expressly set forth in the Limited Guarantee, in each case up to the aggregate amount specified therein and subject to the terms and conditions of the Limited Guarantee and the Merger Agreement.

Subject to specified exceptions, TriArtisan Capital Advisors’ obligation under the Limited Guarantee will immediately terminate upon the earliest to occur of: (i) the Closing; (ii) the valid termination of the Merger Agreement in accordance with its terms by mutual consent of the parties thereto or in circumstances where the Parent Termination Fee is not payable; (iii) the date that is 120 days following the valid termination of the Merger Agreement in accordance with its terms in circumstances where the Parent Termination Fee is payable (subject to certain exceptions); (iv) the full performance and payment of the obligations guaranteed by TriArtisan Capital Advisors in accordance with the terms and conditions of the Limited Guarantee and the Merger Agreement; and (v) the Company or any of its affiliates (or any person acting at the direction of the foregoing) asserting any claim against TriArtisan Capital Advisors or certain other non-recourse parties other than certain retained claims permitted under the Limited Guarantee.

The Interim Investors Agreement provides that certain co-investors may agree to commit to provide “back-stop” guarantees pursuant to which such co-investors would be obligated to pay a portion of any amounts payable by TriArtisan Capital Advisors under the Limited Guarantee. No such back-stop guarantee will relieve TriArtisan Capital Advisors of its obligations under the Limited Guarantee.

Appraisal Rights

General

If the Merger is completed, record holders and beneficial owners of shares of Common Stock who do not vote in favor of the adoption of the Merger Agreement and who properly demand an appraisal of their shares and

 

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who otherwise comply with the requirements set forth in Section 262 of the DGCL will be entitled to appraisal rights in connection with the Merger. Strict compliance with the statutory procedures in Section 262 of the DGCL is required. Failure to timely and properly comply with such statutory requirements will result in the loss of your appraisal rights.

This section summarizes certain material provisions of the DGCL pertaining to appraisal rights. The following discussion, however, is not a full summary of the law and is qualified in its entirety by reference to the full text of Section 262 of the DGCL. All references within Section 262 of the DGCL to a “stockholder” are to the record holder of shares of Common Stock. The following discussion does not constitute any legal or other advice, nor does it constitute a recommendation as to whether or not a Denny’s Corporation stockholder should exercise its right to seek appraisal.

Under the DGCL, if you (as a record holder or beneficial owner) hold one or more shares of Common Stock, do not vote in favor of the adoption of the Merger Agreement, continuously hold such shares through the Effective Time and otherwise comply with the requirements of Section 262 of the DGCL, you will be entitled to have your shares appraised by the Delaware Court of Chancery and to receive the “fair value” of such shares (as determined by the Court, exclusive of any element of value arising from the accomplishment or expectation of the Merger) in cash, together with interest, if any. It is possible that any such “fair value” as determined by the Delaware Court of Chancery may be more than, less than, or the same as the Merger Consideration. These rights are known as appraisal rights.

Under Section 262 of the DGCL, not less than 20 days prior to the Special Meeting, the Company must notify each stockholder who was a stockholder on the Record Date and who is entitled to exercise appraisal rights that such rights are available. This proxy statement constitutes the required notice. A copy of Section 262 of the DGCL can be accessed without subscription or cost at the following website: https://delcode.delaware.gov/title8/c001/sc09/index.html#262.

A STOCKHOLDER OR BENEFICIAL OWNER OF COMMON STOCK WHO WISHES TO EXERCISE APPRAISAL RIGHTS OR WHO WISHES TO PRESERVE THE RIGHT TO DO SO SHOULD REVIEW THE FOLLOWING DISCUSSION AND THE FULL TEXT OF SECTION 262 OF THE DGCL CAREFULLY. FAILURE TO COMPLY PRECISELY WITH THE PROCEDURES OF SECTION 262 OF THE DGCL IN A TIMELY AND PROPER MANNER WILL RESULT IN THE LOSS OF APPRAISAL RIGHTS. BECAUSE OF THE COMPLEXITY OF THE PROCEDURES FOR EXERCISING THE RIGHT TO SEEK APPRAISAL, A STOCKHOLDER OR BENEFICIAL OWNER OF COMMON STOCK WHO IS CONSIDERING WHETHER TO EXERCISE ITS APPRAISAL RIGHTS IS ENCOURAGED TO CONSULT WITH THEIR OWN LEGAL COUNSEL. ANY SHARES OF COMMON STOCK HELD BY A STOCKHOLDER OR BENEFICIAL OWNER WHO FAILS TO PERFECT, SUCCESSFULLY WITHDRAWS OR OTHERWISE LOSES HIS, HER OR ITS APPRAISAL RIGHTS WILL BE DEEMED TO HAVE BEEN CONVERTED AS OF THE EFFECTIVE TIME INTO THE RIGHT TO RECEIVE THE MERGER CONSIDERATION.

How to Exercise and Perfect Your Appraisal Rights

If you are a Company stockholder or beneficial owner and wish to exercise the right to seek an appraisal of your shares of Common Stock, you must comply with ALL of the following:

 

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you must NOT vote “FOR,” or otherwise consent in writing to, the Merger Proposal. Because a proxy that is signed and submitted but does not otherwise contain voting instructions will, unless revoked, be voted in favor of the Merger Proposal, if you submit a proxy and wish to exercise your appraisal rights, you must include voting instructions to vote your shares “AGAINST,” or as an abstention with respect to, the Merger Proposal;

 

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you must continuously hold your shares of Common Stock from the date of making the demand through the effective date of the Merger. You will lose your appraisal rights if you transfer your shares of Common Stock before the effective date of the Merger;

 

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•

prior to the taking of the vote on the Merger Proposal at the Special Meeting, you must deliver a proper written demand for appraisal of your shares;

 

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you, another stockholder, or a beneficial owner of shares or the Surviving Company must file a petition in the Delaware Court of Chancery requesting a determination of the fair value of the shares of Common Stock within 120 days after the effective date of the Merger. The Surviving Company is under no obligation to file any such petition in the Delaware Court of Chancery and has no intention of doing so. Accordingly, it is the obligation of Denny’s Corporation stockholders or beneficial owners to initiate all necessary action to properly demand their appraisal rights in respect of shares of Common Stock within the time prescribed in Section 262 of the DGCL; and

 

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you must otherwise comply with the applicable procedures and requirements set forth in Section 262 of the DGCL.

If you fail to comply with any of these conditions and the Merger is completed, you will be entitled to receive the Merger Consideration, but you will have no appraisal rights with respect to your shares of Common Stock.

Filing a Written Demand

Neither voting against the Merger Proposal, nor abstaining from voting or failing to vote on the Merger Proposal, will in and of itself constitute a written demand for appraisal satisfying the requirements of Section 262 of the DGCL. A record holder or beneficial owner of shares of Common Stock wishing to exercise appraisal rights must deliver to the Company, before the taking of the vote on the Merger Proposal at the Special Meeting, a written demand for the appraisal of the stockholder’s shares. A stockholder’s failure to deliver the written demand prior to the taking of the vote on the Merger Proposal at the Special Meeting will constitute a waiver of appraisal rights. The written demand for appraisal must be in addition to and separate from any proxy or vote on the Merger Proposal.

A demand for appraisal must be executed by or on behalf of a stockholder of record or beneficial owner. The demand must reasonably inform us of the identity of the stockholder of record holding the shares for which appraisal is demanded, the intention of the person to demand appraisal of his, her, their or its shares and, in case of a demand made by a beneficial owner, must be accompanied by documentary evidence of such beneficial owner’s beneficial ownership of the shares and a statement that such documentary evidence is a true and correct copy of what it purports to be and must provide an address at which such beneficial owner consents to receive notices given by the Surviving Company under Section 262 of the DGCL. The written demand should state the number of shares of Common Stock as to which appraisal is sought. Where no number of shares of Common Stock is expressly mentioned, the demand will be presumed to cover all shares of Common Stock held in the name of the holder of record.

If your shares of Common Stock are owned of record in a fiduciary capacity, such as by a trustee, guardian or custodian, execution of the demand for appraisal should be made in that capacity, and if your shares are owned of record jointly with one or more other persons, as in a joint tenancy or tenancy in common, the demand for appraisal should be executed by or for you and all other joint owners. An authorized agent may execute the demand for appraisal for a stockholder of record or beneficial owner; however, the agent must identify the holder or holders of record (and, if applicable, the beneficial owner or owners) and expressly disclose the fact that, in exercising the demand, such person is acting as agent.

If you elect to exercise appraisal rights under Section 262 of the DGCL, you should mail or deliver a written demand to:

Denny’s Corporation

203 East Main Street

Spartanburg, South Carolina 29319

Attention: Secretary

 

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At any time within 60 days after the effective date of the Merger, any Denny’s Corporation stockholder or beneficial owner that made a demand for appraisal but has not commenced an appraisal proceeding or joined in such a proceeding as a named party will have the right to withdraw the demand and to accept the Merger Consideration in accordance with the Merger Agreement for his, her or its shares of Common Stock by delivering to the Surviving Company a written withdrawal of the demand. After such 60-day period, a demand for appraisal may be withdrawn only with the written approval of the Surviving Company.

Notice by the Surviving Company

Within ten days after the effective date of the Merger, Denny’s Corporation, as the Surviving Company, must notify each record holder and beneficial owner of Common Stock who has made a written demand for appraisal and has not voted in favor of the Merger Proposal of the date that the Merger has become effective.

Filing a Petition for Appraisal with the Delaware Court of Chancery

Within 120 days after the effective date of the Merger, but not later, a stockholder of record or a beneficial owner who has complied with the requirements of Section 262 of the DGCL or the Surviving Company may commence an appraisal proceeding by filing a petition in the Delaware Court of Chancery demanding an appraisal of the value of the shares of Common Stock held by all stockholders who have properly demanded appraisal. None of Parent, Merger Sub or Denny’s Corporation, as the Surviving Company, is under any obligation to file an appraisal petition or has any intention to do so. If you desire to have your shares of Common Stock appraised, you should initiate any petitions necessary for properly demanding your appraisal rights within the time periods and in the manner prescribed in Section 262 of the DGCL.

Within 120 days after the effective date of the Merger, so long as you have complied with the provisions of Section 262 of the DGCL, you will be entitled to receive from the Surviving Company, upon written request, a statement setting forth the aggregate number of shares of Common Stock not voted in favor of the Merger Proposal and with respect to which the Company has received demands for appraisal, and the aggregate number of holders of those shares. The Surviving Company must mail this statement to you within ten days after receipt of the request or ten days after the expiration of the period for delivery of demands for appraisal, whichever is later.

If a petition for appraisal is not timely filed, then the right to appraisal will cease.

If a petition for appraisal is duly filed, the Surviving Company will be obligated, within 20 days after receiving service of a copy of the petition, to file with the Delaware Court of Chancery a duly verified list containing the names and addresses of all stockholders and beneficial owners who have demanded an appraisal of their shares. The Delaware Court of Chancery is empowered to conduct a hearing on the petition to determine which stockholders and beneficial owners have complied with Section 262 of the DGCL and have become entitled to appraisal rights. The Delaware Court of Chancery will dismiss the proceedings as to all holders of such shares who are otherwise entitled to appraisal rights unless (i) the total number of shares of Common Stock entitled to appraisal exceeds 1% of the outstanding shares of Common Stock, or (ii) the value of the consideration provided in the Merger for such total number of shares exceeds $1.0 million.

The appraisal proceeding will be conducted in accordance with the rules of the Delaware Court of Chancery. Through the proceeding, the Court will determine the fair value of the shares of Common Stock held by all stockholders who have properly demanded appraisal, exclusive of any element of value arising from the accomplishment or expectation of the Merger, together with interest, if any. Unless the Court in its discretion determines otherwise, interest will be compounded quarterly and will accrue at 5% over the Federal Reserve discount rate from the effective date of the Merger through the date of payment of the judgment.

In determining the fair value, the Delaware Court of Chancery is required to take into account all relevant factors. An opinion of an investment banking firm as to the fairness from a financial point of view of the

 

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consideration payable in a Merger is not an opinion as to fair value under Section 262 of the DGCL. The fair value of shares of Common Stock as determined under Section 262 of the DGCL could be greater than, the same as or less than the Merger Consideration. Neither Parent nor Denny’s Corporation anticipates offering more than the Merger Consideration to any stockholder exercising appraisal rights and reserves the right to assert, in any appraisal proceeding, that the “fair value” of a share of Common Stock is less than the Merger Consideration.

The Delaware Court of Chancery may determine the costs of the appraisal proceeding and may tax those costs upon the parties as it deems equitable. Upon application of a stockholder, the Court may also order all or a portion of the expenses incurred by any stockholder in connection with the proceeding, including reasonable attorneys’ fees and the fees and expenses of experts, to be charged pro-rata against the value of all shares entitled to appraisal.

If you have duly demanded an appraisal, you will not, from and after the effective date of the Merger, be entitled to vote the shares subject to the demand or receive any dividends on those shares, except dividends payable to holders of record as of a record date prior to the effective date of the Merger.

If you fail to properly demand or successfully withdraw your demand for appraisal, or otherwise lose your appraisal rights, your shares of Common Stock will be deemed to have been converted as of the effective date of the Merger into the right to receive the Merger Consideration.

THE PROCESS OF DEMANDING AND EXERCISING APPRAISAL RIGHTS REQUIRES STRICT COMPLIANCE WITH THE TECHNICAL PREREQUISITES OF SECTION 262 OF THE DGCL. IF YOU WISH TO EXERCISE YOUR APPRAISAL RIGHTS, YOU SHOULD CONSULT WITH YOUR OWN LEGAL COUNSEL. TO THE EXTENT THERE ARE ANY INCONSISTENCIES BETWEEN THE FOREGOING SUMMARY AND SECTION 262 OF THE DGCL, THE DGCL WILL GOVERN.

Material U.S. Federal Income Tax Consequences of the Merger

The following discussion is a summary of the material U.S. federal income tax consequences of the Merger to U.S. holders and non-U.S. holders (each as defined below) of shares of Common Stock who receive cash in exchange for such shares of Common Stock pursuant to the Merger. This discussion is for general informational purposes only and does not purport to be a complete analysis of all potential tax consequences of the Merger. The tax consequences of the Merger under U.S. federal tax laws other than those pertaining to income tax, such as estate and gift tax laws, and any applicable state, local and non-U.S. tax laws are not discussed. This discussion is based on the Code, the Treasury Regulations promulgated thereunder, judicial decisions and published rulings and administrative pronouncements of the Internal Revenue Service (the “IRS”), in each case, in effect as of the date of this proxy statement. These authorities may change or be subject to differing interpretations, and any such change or differing interpretation may be applied retroactively in a manner that could affect the accuracy of the statements and conclusions set forth in this discussion. The U.S. federal income tax laws are complex and subject to varying interpretation. We have not sought, and do not intend to seek, any ruling from the IRS with respect to the statements made and the conclusions reached in the following discussion. There can be no assurance that the IRS or a court will not take a contrary position to that discussed below regarding the material U.S. federal income tax consequences of the Merger.

This discussion is limited to holders of shares of Common Stock who hold such shares as “capital assets” within the meaning of Section 1221 of the Code (generally, property held for investment). This discussion does not purport to consider all U.S. federal income tax consequences of the Merger that may be relevant to a holder in light of such holder’s particular circumstances, including the impact of the alternative minimum tax or the Medicare contribution tax on certain net investment income. In addition, this discussion does not address the U.S. federal income tax consequences to holders subject to special rules under the U.S. federal income tax laws, including, without limitation:

 

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U.S. expatriates and former citizens or long-term residents of the United States;

 

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•

U.S. holders whose functional currency is not the U.S. dollar;

 

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persons holding shares of Common Stock as part of a hedge, straddle or other risk reduction strategy or as part of a conversion transaction or other integrated investment;

 

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banks, insurance companies and other financial institutions;

 

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brokers or dealers in securities, commodities or non-U.S. currencies;

 

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traders in securities that elect to apply a mark-to-market method of tax accounting;

 

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“controlled foreign corporations,” “passive foreign investment companies” and corporations that accumulate earnings to avoid U.S. federal income tax;

 

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“S corporations,” partnerships or other entities or arrangements classified as partnerships for U.S. federal income tax purposes or other pass-through entities (and investors therein);

 

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real estate investment trusts and regulated investment companies;

 

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tax-exempt organizations or governmental organizations, and their controlled entities;

 

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persons deemed to sell their shares of Common Stock under the constructive sale provisions of the Code;

 

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persons who own an equity interest, actually or constructively, in Parent;

 

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accrual method holders of shares of Common Stock who prepare an “applicable financial statement” (as defined in Section 451 of the Code);

 

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persons who hold or received their shares of Common Stock pursuant to the exercise of any employee stock option or otherwise as compensation;

 

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tax-qualified retirement plans, individual retirement accounts or other tax deferred accounts;

 

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entities subject to the U.S. anti-inversion rules;

 

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holders subject to special tax accounting rules as a result of any item of gross income with respect to the shares of Common Stock being taken into account in an “applicable financial statement” (as defined in the Code); and

 

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“qualified foreign pension funds” as defined in Section 897(l)(2) of the Code and entities all of the interests of which are held by qualified foreign pension funds.

This discussion also does not address the U.S. federal income tax consequences to holders of shares of Common Stock who exercise appraisal rights in connection with the Merger under the DGCL.

If an entity or arrangement classified as a partnership for U.S. federal income tax purposes holds shares of Common Stock, the U.S. federal income tax treatment of a partner in such partnership will generally depend on the status of the partner, the activities of the partnership and certain determinations made at the partnership or partner level.

Partnerships holding shares of Common Stock and partners in such partnerships should consult their own tax advisors regarding the U.S. federal income tax consequences of the Merger to them.

THIS DISCUSSION IS FOR INFORMATIONAL PURPOSES ONLY AND IS NOT TAX OR LEGAL ADVICE. HOLDERS OF SHARES OF COMMON STOCK SHOULD CONSULT THEIR OWN TAX ADVISORS WITH RESPECT TO THE U.S. FEDERAL INCOME TAX CONSEQUENCES OF THE MERGER TO THEM IN LIGHT OF THEIR PARTICULAR CIRCUMSTANCES, AS WELL AS ANY TAX CONSEQUENCES OF THE MERGER ARISING UNDER THE U.S. FEDERAL TAX LAWS OTHER THAN THOSE PERTAINING TO INCOME TAX, INCLUDING ESTATE OR GIFT TAX LAWS, OR UNDER ANY STATE, LOCAL OR NON-U.S. TAX LAWS OR UNDER ANY APPLICABLE INCOME TAX TREATY.

 

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Tax Consequences to U.S. Holders

Definition of a U.S. Holder

For purposes of this discussion, a “U.S. holder” is any beneficial owner of shares of Common Stock that, for U.S. federal income tax purposes, is or is treated as:

 

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an individual who is a citizen or resident of the United States;

 

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a corporation (or other entity taxable as a corporation) created or organized under the laws of the United States, any state thereof or the District of Columbia;

 

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an estate, the income of which is subject to U.S. federal income tax regardless of its source; or

 

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a trust that (i) is subject to the primary supervision of a U.S. court and one or more “United States persons” (within the meaning of Section 7701(a)(30) of the Code) are authorized to control all substantial decisions of the trust, or (ii) has a valid election in effect to be treated as a “United States person” for U.S. federal income tax purposes.

Effect of the Merger

The receipt of cash by a U.S. holder in exchange for shares of Common Stock in the Merger will generally be a taxable transaction for U.S. federal income tax purposes. The amount of any taxable gain or loss realized by a U.S. holder who receives cash in exchange for shares of Common Stock in the Merger will generally equal the difference, if any, between the amount of cash received for such shares (determined before the deduction of any applicable withholding taxes) and the U.S. holder’s adjusted tax basis in such shares. Gain or loss must be determined separately for each block of shares of Common Stock (i.e., shares acquired for the same cost in a single transaction) disposed of pursuant to the Merger. Such gain or loss generally will be capital gain or loss and generally will be long-term capital gain or loss if the U.S. holder’s holding period for such block of shares of Common Stock is more than one year as of the date of the Merger. Long-term capital gains recognized by certain non-corporate U.S. holders, including individuals, are generally taxable at preferential rates. The deductibility of capital losses is subject to limitations.

Tax Consequences to Non-U.S. Holders

Definition of a Non-U.S. Holder

For purposes of this discussion, a “non-U.S. holder” is a beneficial owner of shares of Common Stock that is neither a U.S. holder nor an entity or arrangement classified as a partnership for U.S. federal income tax purposes.

Effect of the Merger

Subject to the discussion of backup withholding in “—Information Reporting and Backup Withholding” below, a non-U.S. holder will generally not be subject to U.S. federal income tax on any gain realized on the receipt of cash in exchange for shares of Common Stock in the Merger unless:

 

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the gain is effectively connected with the non-U.S. holder’s conduct of a trade or business within the United States (and, if required by an applicable income tax treaty, such gain is also attributable to a permanent establishment or fixed base in the United States);

 

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the non-U.S. holder is a nonresident alien individual present in the United States for 183 days or more during the taxable year of the disposition of shares of Common Stock in the Merger, and certain other requirements are met; or

 

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Denny’s Corporation is or has been a U.S. real property holding corporation (“USRPHC”) for U.S. federal income tax purposes at any time during the shorter of the five-year period ending on the date of the Merger or the period that the non-U.S. holder held shares of Common Stock, and certain other conditions are satisfied.

 

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Gain described in the first bullet point above will generally be subject to U.S. federal income tax on a net income basis at the regular graduated U.S. federal income tax rates in the same manner as if such non-U.S. holder were a U.S. holder. A non-U.S. holder that is a corporation for U.S. federal income tax purposes also may be subject to an additional branch profits tax at a rate of 30% (or such lower rate as may be specified under an applicable income tax treaty) on its effectively connected earnings and profits that are not reinvested in the United States for the taxable year, subject to certain adjustments.

Gain described in the second bullet point above will generally be subject to U.S. federal income tax at a rate of 30% (or such lower rate as may be specified under an applicable income tax treaty), which may be offset by U.S.- source capital losses of the non-U.S. holder (even though the individual is not considered a resident of the United States), so long as the non-U.S. holder has timely filed U.S. federal income tax returns with respect to such losses.

With respect to the third bullet point above, the determination of whether the Company is a USRPHC depends on the fair market value of its U.S. real property interests relative to the fair market value of its other trade or business assets and its United States and foreign real property interests. The Company believes that, as of the Effective Time, it will not have been a USRPHC at any time within the five-year period immediately preceding the Effective Time. Even if the Company has been or is a USRPHC, so long as Common Stock is regularly traded, as defined by applicable Treasury Regulations, on an established securities market, shares of Common Stock will be treated as a U.S. real property interest only with respect to a non-U.S. holder that holds more than 5% of the outstanding shares of Common Stock, directly or indirectly, actually or constructively, during the shorter of the five-year period ending on the date of the Merger and the non-U.S. holder’s holding period with respect to the shares of Common Stock.

Non-U.S. holders should consult their own tax advisors regarding potentially applicable income tax treaties that may provide for different rules.

Information Reporting and Backup Withholding

Payments made to stockholders in the Merger may be subject to information reporting to the IRS and backup withholding. A U.S. holder generally will not be subject to backup withholding if the U.S. holder provides the paying agent with an applicable and properly executed IRS Form W-9 (or other applicable or successor form), certifying under penalties of perjury that such U.S. holder is a United States person, the taxpayer identification number provided is correct and such U.S. holder is not subject to backup withholding. A Non-U.S. holder generally will not be subject to backup withholding if the non-U.S. holder provides the paying agent with an applicable and properly executed IRS Form W-8BEN, W-8BEN-E or W-8ECI (or other applicable or successor form), as the case may be, certifying under penalties of perjury the holder’s non-U.S. status (and the payor or applicable withholding agent does not have actual knowledge or reason to know that the holder is a U.S. person as defined under the Code) or by otherwise establishing an exemption. Copies of information returns that are filed with the IRS may be made available under an applicable tax treaty or information exchange agreement to the tax authorities of the country in which the non-U.S. holder resides or is established. Backup withholding is not an additional tax. Any amounts withheld under the backup withholding rules may be allowed as a refund or a credit against a holder’s U.S. federal income tax liability, if any, so long as the required information is timely furnished to the IRS.

Withholding on Foreign Entities

Sections 1471 through 1474 of the Code (“FATCA”), impose a U.S. federal withholding tax of 30% on certain payments made to a “foreign financial institution” (as specially defined under those rules) unless such institution enters into an agreement with the U.S. government to withhold on certain payments and to collect and provide to the U.S. tax authorities substantial information regarding certain U.S. account holders of such institution (which includes certain equity and debt holders of such institution, as well as certain account holders

 

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that are foreign entities with U.S. owners) or an exemption applies. FATCA also generally will impose a U.S. federal withholding tax of 30% on certain payments made to a “non-financial foreign entity” (as specially defined under those rules) unless such entity provides the withholding agent a certification identifying certain direct and indirect U.S. owners of the entity or an exemption applies. An intergovernmental agreement between the United States and an applicable foreign country may modify these requirements. Under certain circumstances, a non-U.S. holder might be eligible for refunds or credits of such taxes. The IRS has issued proposed Treasury Regulations that eliminate the federal withholding tax of 30% applicable to the gross proceeds of a sale or other disposition of Common Stock under FATCA. Pursuant to the preamble of these proposed Treasury Regulations, any withholding agent may (but is not required to) rely on this proposed change to FATCA withholding until the final regulations are issued or the proposed regulations are withdrawn.

Holders of Common Stock are encouraged to consult with their own tax advisors regarding the possible implications of FATCA on the disposition of Common Stock pursuant to the Merger.

THE DISCUSSION ABOVE OF MATERIAL U.S. FEDERAL INCOME TAX CONSEQUENCES IS NOT INTENDED TO CONSTITUTE A COMPLETE DESCRIPTION OF ALL TAX CONSEQUENCES RELATING TO THE MERGER. THIS SUMMARY IS FOR GENERAL INFORMATION PURPOSES ONLY AND IS NOT TAX OR LEGAL ADVICE. BECAUSE INDIVIDUAL CIRCUMSTANCES MAY DIFFER, EACH HOLDER SHOULD CONSULT THEIR OWN TAX ADVISORS REGARDING THE APPLICABILITY OF THE RULES DISCUSSED ABOVE TO THE HOLDER AND THE PARTICULAR TAX EFFECTS TO THE HOLDER OF THE MERGER IN LIGHT OF SUCH HOLDER’S PARTICULAR CIRCUMSTANCES, INCLUDING THE TAX CONSEQUENCES ARISING UNDER THE U.S. FEDERAL ESTATE OR GIFT TAX RULES, OR THROUGH THE APPLICATION OF ANY STATE, LOCAL OR NON-U.S. TAX LAWS OR UNDER ANY APPLICABLE INCOME TAX TREATY.

Regulatory Approvals Required for the Merger

Antitrust and Foreign Investment Approvals

Under the terms of the Merger Agreement, Parent must notify the Company in writing by November 26, 2025, of its determination of whether any filings are required under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (the “HSR Act”). If filings are required under the HSR Act, Parent and the Company would be required to make such premerger notification filings within 15 Business Days of Parent’s notice and to await the expiration or termination of the statutory waiting period under the HSR Act prior to completing the Merger. Parent has notified the Company that it does not expect a filing to be required under the HSR Act to consummate the Merger.

Pursuant to the Merger Agreement, Parent and the Company agreed to use their reasonable best efforts to obtain all required regulatory approvals and to cooperate with respect to obtaining such regulatory approvals. The parties shall be mutually responsible for substantive communications and strategic and timing decisions relating to the HSR Act and any other applicable antitrust laws, but if there is a disagreement that the parties cannot resolve, the determination of Parent shall prevail. Parent must use reasonable best efforts to take, or cause to be taken, all appropriate action and do, or cause to be done all things necessary, proper or advisable under any law to enable the parties to close the Merger by the Outside Date. However, the parties are not required to agree to take any action that is not conditioned upon the Merger, or that would reasonably be expected to have a material adverse impact on the Company or the benefits expected from the Merger.

If the Merger has not occurred on or before June 30, 2026, the Merger Agreement may be terminated by either party.

 

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Other Regulatory Procedures

The Merger may be subject to certain regulatory requirements of other municipal, state and federal, U.S. or non-U.S. governmental agencies and authorities. Parent and the Company are currently working to evaluate and comply in all material respects with these requirements, as appropriate, and do not currently anticipate that they will hinder, delay or restrict completion of the Merger.

 

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THE MERGER AGREEMENT

The following summary describes certain material provisions of the Merger Agreement. This summary is not complete and is qualified in its entirety by reference to the Merger Agreement, which is attached to this proxy statement as Annex A and incorporated into this proxy statement by reference. Capitalized terms used in the following summary and not otherwise defined in this proxy statement shall have the meanings assigned to such terms in the Merger Agreement. We encourage you to read the Merger Agreement carefully and in its entirety because this summary may not contain all the information about the Merger Agreement that is important to you. The rights and obligations of the parties are governed by the express terms of the Merger Agreement and not by this summary or any other information contained in this proxy statement.

Explanatory Note Regarding the Merger Agreement and the Summary of the Merger Agreement

The Merger Agreement and the summary of its terms included in this proxy statement have been prepared to provide you with information regarding the terms of the Merger Agreement and not to provide any other factual information regarding the Company, Parent or Merger Sub, or their respective businesses. Factual disclosures about the Company contained in this proxy statement or in the Company’s public filings with the SEC, as described in “Where You Can Find More Information” on page 113 of this proxy statement, may supplement, update or modify the factual disclosures about the Company contained in the Merger Agreement and described in this summary.

The representations, warranties and covenants contained in the Merger Agreement have been made solely for the purposes of the Merger Agreement and as of specific dates set forth therein and solely for the benefit of parties to the Merger Agreement, and:

 

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were negotiated with the principal purposes of establishing the circumstances in which a party to the Merger Agreement may have the right not to close the Merger if the representations and warranties of the other party prove to be untrue, due to a change in circumstance or otherwise, and allocating risk between the parties to the Merger Agreement, instead of establishing these matters as facts;

 

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have been modified or qualified by certain confidential disclosures that were made among the parties to the Merger Agreement in connection with the negotiation of the Merger Agreement, which disclosures are not reflected in the Merger Agreement itself and are not described in this summary of terms or elsewhere in this proxy statement;

 

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may no longer be true as of a given date;

 

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may be subject to a contractual standard of materiality in a way that is different from those generally applicable to you or other stockholders and reports and documents filed with the SEC; and

 

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may be subject in some cases to other exceptions and qualifications, including exceptions that do not result in, and would not reasonably be expected to have, a “Denny’s Material Adverse Effect” or a “Parent Material Adverse Effect,” as defined in “The Merger Agreement—Representations and Warranties” on page 80 of this proxy statement.

Stockholders are not third-party beneficiaries under the Merger Agreement and should not rely on the representations, warranties, covenants and agreements or any descriptions thereof as characterizations of the actual state of facts or condition of the Company, Parent, Merger Sub or any of their respective affiliates or businesses. In addition, you should not rely on the covenants in the Merger Agreement as actual limitations on the respective businesses of the Company, Parent or Merger Sub because the parties may take certain actions that are either expressly permitted in the confidential disclosure schedule to the Merger Agreement or as otherwise consented to by the appropriate party, which consent may be given without notice to the public. Moreover, information concerning the subject matter of the representations and warranties, which do not purport to be accurate as of the date of this proxy statement, may have changed since the date of the Merger Agreement and

 

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subsequent developments or new information qualifying a representation or warranty may not have been included in this proxy statement. Accordingly, the representations, warranties, covenants and other provisions of the Merger Agreement or any description of such provisions should not be read alone, but instead should be read together with the information provided elsewhere in this proxy statement and in the documents incorporated by reference into this proxy statement, as well as the disclosures in the Company’s periodic and current reports, proxy statements and other documents filed with the SEC. See “Where You Can Find More Information” on page 113 of this proxy statement.

Structure of the Merger

At the Effective Time, Merger Sub will be merged with and into the Company in accordance with the DGCL. As a result of the Merger, the separate corporate existence of Merger Sub will cease, and the Company will continue as the Surviving Company and as wholly owned, indirect subsidiary of Parent. At the Effective Time, the certificate of incorporation of the Company Merger Sub as in effect immediately prior to the Effective Time shall be amended and restated to read in its entirety in the form of the certificate of incorporation of Merger Sub as in effect immediately prior to the Effective Time and, as so amended and restated, shall be the certificate of incorporation of the Surviving Company until thereafter changed or amended as provided therein or by applicable law. The bylaws of the Company as in effect immediately prior to the Effective Time shall be amended and restated to read in their entirety in the form of the bylaws of Merger Sub as in effect immediately prior to the Effective Time and, as so amended and restated, shall be the bylaws of the Surviving Company until thereafter changed or amended as provided therein and in the certificate of incorporation of the Surviving Company and by applicable law.

Consummation and Effectiveness of the Merger

The closing of the Merger (the “Closing”) is required to take place remotely by exchange of documents and signatures no later than the third business day following the day on which the last of the conditions to the Closing set forth in the Merger Agreement is satisfied or (to the extent permitted by applicable law) waived by the party or parties entitled to the benefits thereof (other than those conditions that by their terms are to be satisfied at the Closing, but subject to the satisfaction or (to the extent permitted by applicable law) waiver of such conditions), or at such other place, time and date as shall be agreed upon in writing by the Company and Parent. The Merger will become effective at the time the certificate of merger is duly filed with the Secretary of State of the State of Delaware or at such later date and time as the Company, Parent and Merger Sub agree and specify in the certificate of merger.

Merger Consideration

Subject to the terms and conditions of the Merger Agreement, at the Effective Time, by virtue of the Merger: (i) each share of Common Stock owned by the Company or any of its wholly owned subsidiaries or owned by Parent, Merger Sub, or any of their respective affiliates, in each case, immediately prior to the Effective Time shall no longer be outstanding and shall automatically be canceled and retired and shall cease to exist, and no consideration shall be delivered in exchange for such cancellation and retirement (collectively, referred to herein as Cancelled Shares); and (ii) each share of Common Stock, other than any Cancelled Shares or Dissenting Shares, issued and outstanding immediately prior to the Effective Time will be converted into the right to receive $6.25 per share in cash, without interest and subject to any applicable withholding taxes (referred to herein as, the Merger Consideration).

Appraisal Rights

Notwithstanding any provision of the Merger Agreement, shares of Common Stock that are issued and outstanding immediately prior to the Effective Time and that are held by holders who have not voted in favor of the adoption of the Merger Agreement or consented thereto in writing and are entitled to demand and properly

 

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demand appraisal of such shares pursuant to, and who have properly exercised and perfected their demands for appraisal rights under and comply in all respects with, Section 262 of the DGCL (the “Appraisal Rights”, and such shares, the “Dissenting Shares”), shall not be converted into the right to receive the Merger Consideration. At the Effective Time, the Dissenting Shares shall be cancelled and cease to exist, and holders of Dissenting Shares shall only be entitled to the Appraisal Rights; provided, that if any such holder shall fail to perfect or otherwise shall waive, withdraw or lose the right to appraisal under the Appraisal Rights or other applicable law, then the Dissenting Shares shall be deemed to have been converted into, as of the Effective Time, and to have become exchangeable solely for the right to receive, without interest or duplication and subject to any withholding taxes, the Merger Consideration pursuant to the Merger Agreement. The Company shall give Parent (i) prompt written notice (and in any event within two business days) of any written demand for appraisal of shares of Common Stock received by the Company prior to the Effective Time pursuant to the DGCL, any withdrawal of any such demand and any other demand, notice or instrument delivered to the Company prior to the Effective Time that relates to such demand and (ii) the right to participate in, control and direct all negotiations and proceedings with respect to such demands or instruments. The Company shall not, except with the prior written consent of Parent, voluntarily make any payment with respect to any demands, notices or instruments for appraisal or offer to settle or settle any such demands, or agree to do any of the foregoing.

Exchange and Payment Procedures

Paying Agent

Prior to the Effective Time, Parent or Merger Sub shall designate a reputable U.S. bank or trust company that is reasonably acceptable to the Company to act as paying agent (the “Paying Agent”) for the payment of the Merger Consideration in accordance with the Merger Agreement. At or prior to the Effective Time, Parent shall deposit or cause to be deposited with the Paying Agent, in trust for the benefit of holders of shares of Common Stock, cash in U.S. dollars sufficient to pay the aggregate Merger Consideration in exchange for all of the shares of Common Stock outstanding immediately prior to the Effective Time (other than the Cancelled Shares and Dissenting Shares), payable upon due surrender of physical stock certificates that represent ownership of shares of Common Stock (“Certificates”) (or effective affidavits of loss in lieu thereof) or book-entry shares pursuant to the provisions of the Merger Agreement (such cash being referred to as the “Merger Fund”). In the event the Merger Fund shall at any time be insufficient to pay the Merger Consideration in accordance with the Merger Agreement, Parent shall, or shall cause Merger Sub to, as promptly as reasonably practicable deposit additional cash in immediately available funds with the Paying Agent in an amount that is equal to the deficiency in the amount required to make such payment. Parent shall cause the Paying Agent to make delivery of the Merger Consideration out of the Merger Fund in accordance with the Merger Agreement.

Payment Procedures for Certificates

As promptly as reasonably practicable after the Effective Time (and in no event later than three business days after the Effective Time), Parent or the Surviving Company shall cause the Paying Agent to mail to each person who was, immediately prior to the Effective Time, a holder of record of Certificates (other than Certificates representing Cancelled Shares or Dissenting Shares): (i) a letter of transmittal (which shall specify that delivery shall be effected, and risk of loss and title to the Certificates shall pass, only upon delivery of the Certificates (or affidavits of loss in lieu thereof) to the Paying Agent, and which shall be in a customary form reasonably acceptable to the Company and Parent prior to the Effective Time) and (ii) instructions for use in effecting the surrender of the Certificates to the Paying Agent. Upon delivery of a duly completed and validly executed letter of transmittal (and such other documents as reasonably required by the Paying Agent), together with surrender of a Certificate (or an affidavit of loss in lieu thereof), the holder of record of such Certificate shall be entitled to receive in exchange therefor the Merger Consideration for each share of Common Stock formerly represented by such Certificate, and the Certificate so surrendered shall forthwith be cancelled. Until surrendered as contemplated by the Merger Agreement, each Certificate shall be deemed at any time after the Effective Time to represent only the right to receive the Merger Consideration (except for Certificates

 

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representing any Dissenting Shares, which shall represent the right to receive payment of the fair value of such shares of Common Stock represented by such Certificates in accordance with and to the extent provided by Section 262 or the DGCL, or any Cancelled Shares). If payment of the Merger Consideration is to be made to a person other than the person in whose name the surrendered Certificate is registered, payment may be made only if such Certificate is presented with all documents required to evidence and effect such transfer and to evidence to the reasonable satisfaction of the Paying Agent that any applicable stock transfer or similar taxes have been paid or are not applicable.

Payment Procedures for Book-Entry Shares

The persons who were, at the Effective Time, holders of book-entry shares shall not be required to deliver a Certificate or, unless required by the Paying Agent, an executed letter of transmittal, to the Paying Agent with respect to the exchange of their book-entry shares for the Merger Consideration. With respect to book-entry shares held through DTC, each holder of record of such shares shall upon the Effective Time, in accordance with DTC’s customary procedures (including, if required, receipt by the Paying Agent of an “agent’s message” (or such other evidence of transfer or surrender as the Paying Agent may reasonably request)) and such other procedures as agreed by the Company, Parent, the Paying Agent and, if applicable, DTC, be entitled to receive, and Parent shall cause the Paying Agent to pay and deliver to DTC, as promptly as practicable after the Effective Time, the Merger Consideration for each such book-entry share, and such book-entry share shall be cancelled. With respect to book-entry shares not held through DTC, if required by the Paying Agent, as soon as reasonably practicable after the Effective Time (and in no event later than three business days after the Effective Time), the Surviving Company shall cause the Paying Agent to mail to each person who was, immediately prior to the Effective Time, a holder of record of such shares: (i) a letter of transmittal and (ii) instructions for returning such letter of transmittal in exchange for the Merger Consideration, the forms of which letter of transmittal and instructions shall be subject to the reasonable approval of the Company prior to the Effective Time. Upon delivery of a duly completed and validly executed letter of transmittal, if required by the Paying Agent, the holder of record of such book-entry share shall be entitled to receive in exchange therefor the Merger Consideration for each share of Common Stock formerly represented by such book-entry share, and the book-entry share so surrendered shall forthwith be cancelled. With respect to book-entry shares, payment of the Merger Consideration shall only be made to the person in whose name such book-entry shares are registered in the stock transfer books of the Company as of the Effective Time. No interest will be paid or accrued on any amount payable upon due surrender of book-entry shares. Until paid or surrendered as contemplated hereby, each book-entry share shall be deemed at any time after the Effective Time to represent only the right to receive the Merger Consideration as contemplated by the Merger Agreement, except for book-entry shares representing Dissenting Shares, which shall be deemed to represent the right to receive payment in accordance with and to the extent provided by Section 262 of the DGCL, or Cancelled Shares.

Transfer Books; No Further Ownership Rights

The Merger Consideration paid in respect of the shares of Common Stock in accordance with the terms of the Merger Agreement shall be deemed to have been paid in full satisfaction of all ownership rights in such shares, and at the Effective Time, the stock transfer books of the Company shall be closed and thereafter there shall be no further recording or registration of transfers on the records of the Company. From and after the Effective Time, the holders of Certificates and book-entry shares outstanding immediately prior to the Effective Time shall cease to have any rights with respect to such shares, except the right to receive the Merger Consideration payable therefor in accordance with the Merger Agreement. The Merger Consideration paid to such stockholders in accordance with the terms of Merger Agreement shall be deemed to have been paid in full satisfaction of all rights pertaining to such shares of Common Stock. From and after the Effective Time, the holders of Certificates and book-entry shares representing Dissenting Shares shall cease to have any rights with respect to such shares of Common Stock, except for the right to receive payment in accordance with and to the extent provided by Section 262 of the DGCL. From and after the Effective Time, the holders of Certificates and book-entry shares representing Cancelled Shares shall cease to have any rights with respect to such Company

 

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Shares as provided for by the Merger Agreement. If, at any time after the Effective Time, certificates or any other valid evidence of ownership of shares of Common Stock that have not been previously surrendered are presented to the Surviving Company for any reason, they shall be cancelled and exchanged for the applicable Merger Consideration as provided in the Merger Agreement.

Lost, Stolen or Destroyed Certificates

If any Certificate shall have been lost, stolen or destroyed, upon the making of an affidavit, in customary form, reasonably acceptable to Parent (which shall contain an agreement in customary form to indemnify Parent, Merger Sub, the Surviving Company and their respective affiliates against any claim that may be made against Parent, Merger Sub, the Surviving Company or their respective affiliates on account of the alleged loss, theft or destruction of such Certificates) of that fact by the person claiming such Certificate to be lost, stolen or destroyed and, if required by Parent, the delivery by such person of a bond, in a customary and reasonable sum as Parent may reasonably direct, as indemnity against any claim that may be made against Parent, Merger Sub, the Surviving Company or the Paying Agent with respect to such Certificate alleged to have been lost, stolen or destroyed, the Paying Agent will pay, in exchange for such lost, stolen or destroyed Certificate, the Merger Consideration for each share of Common Stock formerly represented by such Certificate without interest and subject to any withholding taxes required by applicable law.

Termination of Merger Fund; Abandoned Property; No Liability

At the twelve-month anniversary of the Effective Time, the Surviving Company shall be entitled to require the Paying Agent to deliver to it any portion of the Merger Fund (including any interest received with respect thereto) which has not been disbursed to holders of Certificates or book-entry shares and thereafter such holders shall be entitled to look only to the Surviving Company (subject to abandoned property, escheat or other similar laws) for, and the Surviving Company shall remain liable for, payment of their claims for the Merger Consideration that such holder has the right to receive in accordance with the Merger Agreement, in each case without interest and subject to any withholding of taxes required by applicable law, in respect of such holder’s surrender of its Certificates or book-entry shares and compliance with the procedures of the Merger Agreement. Notwithstanding the foregoing, any amounts remaining unclaimed by such holders at such time at which such amounts would otherwise escheat to or become property of any governmental entity shall become, to the extent permitted by applicable law, the property of the Surviving Company, free and clear of all claims or interest of any person previously entitled thereto. Notwithstanding any provision of the Merger Agreement to the contrary, none of the parties hereto, the Surviving Company or the Paying Agent, nor any employee, officer, director, agent or affiliate of any of them, shall be liable to any person in respect of any part of the Merger Consideration to be paid in accordance with the Merger Agreement, properly delivered to a public official pursuant to any applicable abandoned property, escheat or similar law.

Investment of Merger Fund

The Paying Agent shall invest any cash in the Merger Fund as directed by Parent or Merger Sub, in its sole discretion, so long as, unless otherwise agreed by Parent and the Company prior to the Closing or as specified by the Paying Agent, any such investments must be in obligations of, or guaranteed by, the United States government or any agency or instrumentality thereof, in commercial paper obligations rated A-1 or P-1 or better, or in certificates of deposit, bank repurchase agreements or banker’s acceptances of commercial banks with capital exceeding $5 billion. Earnings from such investments shall be the sole and exclusive property of Parent or Merger Sub, and no part of such earnings shall accrue to the benefit of holders of Common Stock.

Withholding Rights

Each of Parent, Merger Sub, the Surviving Company, the Company, the Paying Agent and any other applicable withholding agent, as the case may be, shall be entitled to deduct and withhold, or to cause the

 

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applicable withholding agent to deduct and withhold, from the consideration otherwise payable pursuant to the Merger Agreement such amounts as may be required to be deducted and withheld with respect to the making of such payment under applicable tax law. Amounts so withheld and timely paid over to the applicable governmental entity shall be treated for all purposes of the Merger Agreement as having been paid to the person in respect of which such deduction or withholding was made. Notwithstanding anything to the contrary, any compensatory amounts payable to any current or former employee of the Company or any of the Company’s subsidiaries pursuant to or as contemplated by the Merger Agreement shall be remitted to the applicable payor for payment to the applicable person through regular payroll procedures, as applicable.

Treatment of Denny’s Corporation Equity-Based Awards

Pursuant to the Merger Agreement, (i) each outstanding Company RSU Award will, by virtue of the Merger, automatically and without any action on the part of the Company, Parent or the holder thereof, be cancelled and terminated and converted into the right of the holder of the Company RSU Award to receive from the Surviving Company an amount in cash (without interest and subject to applicable withholding taxes), equal to the product of (A) the aggregate number of Company Shares underlying such Company RSU Award, multiplied by (B) the Merger Consideration, and (ii) each outstanding Company PSU Award will, by virtue of the Merger, automatically and without any action on the part of the Company, Parent or the holder thereof, be cancelled and terminated and converted into the right of the holder of the Company PSU Award to receive from the Surviving Company an amount in cash (without interest and subject to applicable withholding taxes), equal to the product of (A) the aggregate number of Company Shares underlying such Company PSU Award (with such number of Surviving Company Shares determined in accordance with the terms of the applicable award agreement pursuant to which such Company PSU Award was granted (and without discretionary adjustment by the Board (or a committee thereof))), multiplied by (B) the Merger Consideration. Any Company PSU Award that is unvested as of immediately prior to the Effective Time in accordance with the terms of the applicable award agreement pursuant to which it was granted will automatically be cancelled without further action and for no consideration (including (i) Company PSU Awards that do not vest in connection with the Merger as a result of failing to meet applicable “rTSR” performance goals, and (ii) Company PSU Awards subject to “Adjusted EPS Growth” performance goals that do not vest in connection with the Merger based on deemed achievement of the greater of (x) target performance and (y) actual performance).

Parent shall cause the Company or one of its subsidiaries to pay through the payroll system of the Company or one of its subsidiaries (to the extent applicable) to each employee holder of Company RSU Awards and Company PSU Awards the amounts due to such holder as described above, without interest and less such amounts as are required to be withheld or deducted under applicable law with respect to the making of such payment, as promptly as practicable (but no later than the next regularly scheduled payroll date that is at least five (5) business days) following the Effective Time, so long as the Merger Consideration with respect to any Company RSU Award or Company PSU Award that constitutes nonqualified deferred compensation subject to Section 409A of the Code shall be paid at the earliest time permitted under the terms of such award that will not result in the application of a tax or penalty under Section 409A of the Code.

Company Equity Plans

Pursuant to the Merger Agreement, the Company Board (or a committee thereof) will take all actions necessary, with effect as of the Effective Time, to terminate each Company Equity Plan, including under which there are outstanding awards of deferred stock units subject to Section 409A of the Code.

Conditions to the Consummation of the Merger

The respective obligations of each party to effect the Merger are subject to the satisfaction or, where permitted by law, waiver by the written consent of Parent and Merger Sub of the following conditions:

 

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the receipt of the Denny’s Stockholder Approval;

 

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the receipt of the Required Regulatory Approvals; and

 

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the absence of any Legal Restraint.

In addition, Parent’s and Merger Sub’s obligations to effect the Merger are further subject to the satisfaction or waiver by mutual written consent on or prior to Closing of the following conditions:

 

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the Company’s representations and warranties regarding its issued and outstanding capitalization being true and correct in all respects as of the date of the Merger Agreement and as of the Closing Date as if made on such date (except to the extent expressly made as of an earlier date, in which case as of such earlier date), other than for de minimis inaccuracies;

 

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the Company’s representations and warranties regarding the Company’s subsidiaries’ organization, existence and good standing (without giving effect to any “Denny’s Material Adverse Effect” qualification) and regarding capitalization matters not addressed above being true and correct in all material respects as of the date of the Merger Agreement and as of the Closing Date as if made on such date (except to the extent expressly made as of an earlier date, in which case as of such earlier date);

 

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the Company’s representations and warranties regarding (a) the Company’s organization and qualification, (b) the Company’s authority to enter into the Merger Agreement and perform its obligations thereunder, (c) that no Denny’s Material Adverse Effect has occurred since June 25, 2025 through the execution date of the Merger Agreement, (d) broker, finder and advisory or similar fees, and (e) compliance with state takeover laws (in each case, except with respect to the representation and warranty in clause (c), without giving effect to any materiality or “Denny’s Material Adverse Effect” qualifications), being true and correct in all respects as of the date of the Merger Agreement and as of the Closing Date as if made on such date (except to the extent expressly made as of an earlier date, in which case as of such earlier date);

 

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the Company’s other representations and warranties in the Merger Agreement being true and correct as of the date of the Merger Agreement and as of the Closing Date as if made on such date (except to the extent expressly made as of an earlier date, in which case as of such earlier date), without giving effect to any materiality or “Denny’s Material Adverse Effect” qualifications, except where the failure of such representations to be true and correct, individually or in the aggregate, has not had, and would not reasonably be expected to have, a Denny’s Material Adverse Effect;

 

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performance by the Company in all material respects of all obligations and compliance in all material respects with all covenants required to be performed or complied by it under the Merger Agreement at or prior to the Closing Date;

 

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the absence of any circumstance, occurrence, effect, fact, condition, change, event or development that has had or would reasonably expected to have a Denny’s Material Adverse Effect since the execution date of the Merger Agreement; and

 

•

the delivery by the Company to Parent of a certificate, dated as of the Closing Date, signed by the Company’s chief executive officer or chief financial officer, to the effect that the conditions in the six preceding bullet points have been satisfied; and

 

•

the delivery by the Company to Parent at or prior to the Closing a certificate, in form and substance reasonably satisfactory to Parent, and duly executed and acknowledged, satisfying the requirements of U.S. Treasury Regulation Section 1.1445-2(c)(3).

In addition, the Company’s obligations to consummate the transactions contemplated by the Merger Agreement, including the Merger, are subject to the satisfaction or waiver by written consent of the Company (to the extent permitted by applicable law) of the following conditions:

 

•

the representations and warranties of Parent and Merger Sub in the Merger Agreement being true and correct as of the date of the Merger Agreement and as of the Closing Date as if made on such date (except to the extent expressly made as of an earlier date, in which case as of such earlier date), except where the

 

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failure of any such representations and warranties to be true and correct, individually or in the aggregate, would not reasonably be expected to have a Parent Material Adverse Effect (as defined below);

 

•

performance by Parent and Merger Sub in all material respects of all obligations and compliance in all material respects with all covenants required to be performed or complied by them at or prior to the Closing Date; and

 

•

the delivery by Parent to the Company of a certificate, dated as of the Closing Date, signed by an authorized officer of Parent, to the effect that the conditions in the two preceding bullet points have been satisfied.

Representations and Warranties

The Merger Agreement contains customary representations and warranties by the Company on the one hand, and Parent and Merger Sub, on the other hand.

The representations and warranties of the Company in the Merger Agreement relate to, among other things:

 

•

organization and qualification, standing and power;

 

•

the Company’s subsidiaries;

 

•

capital structure;

 

•

authority; execution and delivery; enforceability;

 

•

no conflicts;

 

•

required filings and consents;

 

•

disclosure documents;

 

•

compliance with applicable laws; permits;

 

•

SEC filings; financial statements;

 

•

internal controls;

 

•

no undisclosed material liabilities;

 

•

absence of certain changes or events;

 

•

employee benefits matters;

 

•

labor matters;

 

•

contracts;

 

•

litigation;

 

•

environmental matters;

 

•

intellectual property; IT systems; data security and privacy;

 

•

taxes and tax matters;

 

•

real and personal properties; title to assets;

 

•

insurance;

 

•

opinion of financial advisor;

 

•

brokers’ fees and expenses;

 

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•

state takeover statutes;

 

•

affiliate transactions;

 

•

suppliers;

 

•

anti-corruption; sanctions; anti-money laundering;

 

•

franchise matters;

 

•

quality and safety of food and beverage products; and

 

•

no other representations or warranties.

The representations and warranties of Parent and Merger Sub in the Merger Agreement relate to, among other things:

 

•

organization and qualification, standing and power;

 

•

authority; execution and delivery; enforceability;

 

•

no conflicts;

 

•

required filings; consents;

 

•

antitrust matters;

 

•

disclosure documents;

 

•

litigation;

 

•

brokers’ fees and expenses;

 

•

ownership of capital stock of the Company;

 

•

ownership of capital stock of Merger Sub;

 

•

solvency;

 

•

absence of arrangements with Company affiliates;

 

•

financing; and

 

•

no other representations or warranties.

The Company’s representations and warranties are qualified by certain confidential disclosures made by the Company to Parent and Merger Sub, as well as by documents filed with or furnished to the SEC by the Company on or after January 1, 2024. In addition, the representations and warranties made by Parent and the Company are subject to exceptions and qualifications (including exceptions based on materiality or (i) in the case of the Company, a Denny’s Material Adverse Effect or (ii) in the case of Parent and Merger Sub, a Parent Material Adverse Effect).

“Denny’s Material Adverse Effect” means, for the purposes of the Merger Agreement, any effect, change, event, circumstance, condition, development or occurrence, individually or in the aggregate, that would reasonably be expected to prevent or materially delay the ability of the Company to consummate the transactions contemplated by the Merger Agreement, or that has had, or would reasonably be expected to have, a material adverse effect on the business, assets, liabilities, properties, condition (financial or otherwise) or results of operations of the Company and its subsidiaries, taken as a whole, excluding to the extent that it results from or arises out of:

 

•

general economic conditions (or changes in such conditions) in the United States or any other country or region in the world, or conditions in the global economy generally;

 

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•

general conditions (or changes in such conditions) in the securities markets, capital markets, credit markets, currency markets or other financial markets in the United States or any other country or region in the world, including (A) changes in interest rates in the United States or any other country or region in the world and changes in exchange rates for the currencies of any countries, and (B) any suspension of trading in securities (whether equity, debt, derivative or hybrid securities) generally on any securities exchange or over-the-counter market operating in the United States or any other country or region in the world;

 

•

general conditions (or changes in such conditions) in the restaurant industry or any other industries in which the Company or its subsidiaries operate;

 

•

political conditions (or changes in such conditions) in the United States or any other country or region in which the Company or any of its subsidiaries has material operations, or acts of war, sabotage or terrorism (including any escalation or general worsening of any such acts of war, sabotage or terrorism) in the United States or any other country or region in the world;

 

•

earthquakes, hurricanes, tsunamis, tornadoes, floods, epidemics, pandemics, cyberattacks, mudslides, wild fires or other natural disasters, weather conditions and other force majeure events in the United States or any other country or region in the world;

 

•

changes or proposed changes in law after the date of the Merger Agreement (or the interpretation thereof) or changes or proposed changes in GAAP or other accounting standards (or the interpretation thereof);

 

•

the public announcement or existence of or compliance with or performance under the Merger Agreement or the public announcement, pendency or consummation of the transactions contemplated by the Merger Agreement, including the identity of Parent, Merger Sub or their affiliates, the termination or the failure or potential failure to renew or enter into any contracts with customers, suppliers, distributors or other business partners, or any negative development in the Company’s relationships with any of its subsidiaries with customers, suppliers, distributors or other business partners (provided, however, that this exclusion does not apply to any representation or warranty to the extent the purpose thereof is to address consequences resulting from the public announcement or existence of or compliance with or performance under the Merger Agreement or the public announcement, pendency or consummation of the transactions contemplated thereby);

 

•

taking any action required by the Merger Agreement or failing to take any action prohibited by the Merger Agreement;

 

•

any voluntary departure of any officers, directors, employees or independent contractors of the Company or the Company’s subsidiaries, directly resulting from, arising out of, attributable to, or related to the transactions contemplated by the Merger Agreement; or

 

•

changes in the Company’s stock price or the trading volume of the Company’s stock, in and of itself, or any failure by the Company to meet any estimates or expectations of the Company’s revenue, earnings or other financial performance or results of operations for any period, in and of itself, or any failure by the Company to meet any internal budgets, plans, operational metrics or forecasts of its revenues, earnings or other financial performance or results of operations, in and of itself, or any decrease in the credit rating of the Company, and of the Company’s subsidiaries or any of their respective indebtedness, in and of itself (but not, in each case, the underlying cause of such changes, decreases or failures, unless the underlying cause of such changes or failures would otherwise be excepted from the definition of a “Denny’s Material Adverse Effect”);

so long as any state of facts, effect, change, event, circumstance, condition, development or occurrence referred to in the exclusions relating to the first, second, third, fourth, fifth and sixth bullet points may be deemed to constitute a Denny’s Material Adverse Effect, or be taken into account in determining whether a Denny’s Material Adverse Effect has occurred or would reasonably be expected to occur, to the extent such state of facts, effect, change, event, circumstance, condition, development or occurrence has a disproportionate adverse effect

 

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on the Company and its subsidiaries, taken as a whole, as compared to similarly sized companies in the industry or industries and geographic markets in which they operate.

“Parent Material Adverse Effect” means, for the purposes of the Merger Agreement, any state of facts, change, condition, occurrence, effect, event, circumstance or development that individually or in the aggregate, would reasonably be expected to materially prevent the consummation of the Merger by Parent or Merger Sub prior to the Outside Date or materially delay consummation of the Merger by Parent or Merger Sub.

None of the representations, warranties, covenants or other agreements contained in the Merger Agreement or in any instrument delivered pursuant to the Merger Agreement, or any rights arising out of any breach of any of the foregoing, will survive the Effective Time, except for covenants and agreements which contemplate performance after the Effective Time or otherwise expressly by their terms survive the Effective Time. For more information, see the section entitled “—Explanatory Note Regarding the Merger Agreement and the Summary of the Merger Agreement” above.

Covenants Related to Conduct of Business

The Company has agreed to certain covenants in the Merger Agreement restricting the conduct of its and its subsidiaries’ businesses between the date of the Merger Agreement and the Effective Time or, if applicable, the date on which the Merger Agreement is validly terminated.

In general, except as required by applicable law or as expressly contemplated or permitted by the Merger Agreement, from the date of the Merger Agreement until the earlier of the Effective Time or the date the Merger Agreement is validly terminated (the “Pre-Closing Period”), the Company will, and will cause its subsidiaries to, conduct its operations in the ordinary course of business in all material respects and use commercially reasonable efforts to preserve intact its business organization and advantageous business relationships with key employees, customers, suppliers, developers, contractors, vendors, licensors, licensees, distributors, lessors, creditors, governmental entities and others having significant business dealings with the Company or any of its subsidiaries, and comply in all material respects with applicable law.

Without limiting the generality of the preceding paragraph, during the Pre-Closing Period and except as required by applicable law or as expressly contemplated or permitted by the Merger Agreement, the Company has agreed that it and its subsidiaries shall not to take the following actions without the prior written consent of Parent (which shall not be unreasonably withheld, conditioned or delayed):

 

•

amend, modify, waive, rescind or otherwise change the Company’s Restated Certificate of Incorporation (the “Charter”) or the Company’s Amended and Restated By-laws (the “Bylaws”) or the comparable organizational and governance documents of any subsidiary of the Company;

 

•

issue, sell, pledge, dispose of, grant, transfer or encumber any shares of capital stock of, or other equity interests in, the Company or any of the Company’s subsidiaries, or any rights based on the value of any such equity interests, other than the vesting or settlement of Company equity awards outstanding as of the date of the Merger Agreement;

 

•

sell, lease, assign, transfer, exchange, swap, pledge, license, sell and leaseback, abandon, mortgage or otherwise encumber, restrict the use of, allow to expire, dispose of or subject to any lien (other than certain permitted liens), in a single transaction or a series of transactions, in whole or in part of any of its properties (in each case, excluding any intellectual property) or rights or any interests therein (in each case, other than for any sale, lease, license, sale and leaseback, abandonment, mortgage or other encumbrance or disposal that would be immaterial to the Company) other than in accordance with existing contracts that have been made available to Parent;

 

•

(a) sell, assign, abandon, convey, transfer or otherwise dispose of, encumber or impair any material intellectual property, except for non-exclusive licenses granted by the Company or any of the Company’s

 

83

subsidiaries to customers in the ordinary course of business or (b) disclose any trade secret owned or held by the Company or any of the Company’s subsidiaries to a third party, other than pursuant to a commercially reasonable confidentiality agreement in the ordinary course of business;

 

•

authorize, declare, set aside, establish a record date for, make or pay any dividend or other distribution (whether payable in cash, stock, property or a combination thereof) with respect to any of its capital stock or other equity interests (other than dividends paid by a wholly owned subsidiary of the Company to the Company or another wholly owned subsidiary of the Company);

 

•

split, combine, subdivide, reclassify, redeem, purchase, acquire or make any similar change or amend the terms of, or redeem, purchase or otherwise acquire, directly or indirectly, any of its or its subsidiaries capital stock, voting securities or other equity, ownership or voting interests, except (A) the withholding or disposition of Common Stock to satisfy withholding tax obligations with respect to company equity awards in accordance with the terms of such company equity awards, (B) upon the forfeiture of outstanding company equity awards, or (C) cash dividends paid to the Company or any wholly owned subsidiary of the Company by a wholly owned subsidiary of the Company with regard to its capital stock or other equity interests;

 

•

merge or consolidate the Company or any of the Company’s subsidiaries with any person or adopt or enter into a plan of complete or partial liquidation or resolutions providing for a complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization or other reorganization of the Company or any of the Company’s subsidiaries;

 

•

acquire (including by purchase, merger, consolidation, joint venture, partnership, consolidation, dissolution, liquidation, tender offer, exchange offer, recapitalization, reorganization, share exchange, business combination, acquisition of stock or assets or similar transaction) any equity interest in or the material assets of any person or business, or make any loan, advance or capital contribution to, or investment in, any person or business (other than a loan or advance to a Franchisee pursuant to a Franchise Agreement in the ordinary course of business);

 

•

incur any Indebtedness or issue any debt securities, or modify in any material respect the terms of, or pre-pay, any Indebtedness or debt securities existing as of the date hereof, or assume or guarantee the obligations in respect of Indebtedness for borrowed money or debt securities of any person or enter into any “keep well” or other agreement to maintain any financial statement condition of another person, except for (i) transactions in the ordinary course of business and consistent with past practice between the Company and any wholly owned subsidiary of the Company or between wholly owned subsidiaries of the Company, (ii) letters of credit that are cash collateralized by the Company Credit Facility in an amount not to exceed five million dollars ($5,000,000) in the aggregate, surety bonds and similar instruments issued in the ordinary course of the Company’s business, including the pledging of cash or other security as may be required by the issuer in connection therewith or (iii) revolving Indebtedness incurred under the Company Credit Facility in excess of two hundred seventy million dollars ($270,000,000) in the aggregate outstanding at any time; provided, that, as of immediately prior to the Closing, the aggregate amount outstanding under the Company Credit Facility will not exceed two hundred sixty million dollars ($260,000,000); provided further, that the outstanding amounts under the Company Credit Facility shall be calculated in each case net of (1) the unrestricted cash held by the Company and (2) the estimated liquidation value of the Company’s interest rate hedges as independently determined by a qualified valuation expert, (B) make any loans, advances or capital contributions to, or investments in, any other person, other than to any wholly owned subsidiary of the Company in the ordinary course of business or a loan or advance to a Franchisee pursuant to a Franchise Agreement in the ordinary course of business, or (C) grant, pledge, assume or otherwise permit to exist any lien (other than permitted liens) on any portion of the assets or property of the Company or any of the Company’s subsidiaries;

 

•

enter into any contract (x) that includes a change of control or similar provision that would require a material payment to or would give rise to any material rights (including termination rights) of the other party or parties thereto as a result of the consummation of the Merger or the other transactions contemplated

 

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by the Merger Agreement, (y) that would reasonably be expected to require a material payment to or would give rise to any material rights (including termination rights) of the other party or parties if a change of control of Parent were to occur immediately following consummation of the Merger or (z) that would have been a Company Material Contract or Company Real Property Lease if it had existed on the date hereof or a Franchise Agreement with a Specified Franchisee; or (B) materially modify or materially amend, renew, extend, cancel, terminate or waive, release or assign any material rights or claims with respect to, any Company Material Contract, Franchise Agreement with any Specified Franchisee or Company Real Property Lease, subject to certain exceptions set forth in the Merger Agreement;

 

•

other than as required pursuant to the Merger Agreement, certain disclosed Benefit Plans as in effect on the date of the Merger Agreement or as required by applicable law, (A) increase the compensation or benefits of any Company Service Provider whose total annual cash compensation opportunity exceeds two hundred fifty thousand dollars ($250,000); (B) adopt or provide any new rights to receive, or grant or promise or commit to grant any, severance, change of control, retention or termination pay, deferred compensation or equity or equity-based awards, to any Company Service Provider, including by (x) extending or expanding eligibility to any new or additional employee or other person as a participant under the Executive Severance Plan, the Key Employee Severance Plan or other severance plan or program of the Company or any affiliate (other than the IU/OU Management/Support Severance Plan), (y) amending the eligibility requirements under the IU/OU Management/Support Severance Plan to increase the number or type of job titles or positions that are eligible for benefits thereunder (including by amending Section 2.4 of such plan), or (z) increasing the benefits available under the Executive Severance Plan, Key Employee Severance Plan, IU/OU Management/Support Severance Plan or other severance plan or program of the Company or any affiliate, or taking any action to trigger eligibility for the receipt of benefits by any person under any such plan or program; (C) establish, adopt, enter into, amend or terminate any Collective Bargaining Agreement or any Benefit Plan (or any plan, program, policy, agreement, scheme or arrangement that would have been a Benefit Plan if it had been in existence on the date of the Merger Agreement), other than offer letters or consulting agreements with any employee or independent contractor whose total annual cash compensation opportunity does not exceed two hundred fifty thousand dollars ($250,000), so long as any such offer letter or consulting agreement does not include (w) severance protections (except for severance protections under the IU/OU Management/Support Severance Plan, but only to the extent that such Company Service Provider would have been eligible to participate in such plan had such offer letter or consulting agreement been entered into as of the date hereof), (x) any pre-termination notice obligations for the Company, (y) commitments to grant equity, or equity-based awards, or (z) transaction or retention payments; (D) recognize or certify any Labor Union or group of employees as the bargaining representative of any Company Service Providers; (E) effectuate any “plant closing” or “mass layoff” within the meaning of, or otherwise take any action triggering the notice requirements or any liability under, the WARN Act; (F) take any action to amend or waive any performance or vesting criteria or accelerate the vesting, payment, exercisability or funding under any Benefit Plan; or (G) hire or terminate (other than for cause or due to death) the employment or engagement of any Company Service Provider whose total annual cash compensation opportunity exceeds (or prior to such termination, exceeded) two hundred fifty thousand dollars ($250,000);

 

•

make any material change in financial accounting policies, practices, principles, methods or procedures, other than as required by GAAP or Regulation S-X promulgated under the Exchange Act or other applicable rules and regulations of the SEC or law including any interpretations thereof or any changes to any of the foregoing;

 

•

other than as required by applicable law, make, revoke or change any material Tax election, change or adopt any material method of Tax accounting, file any material amended Tax Return, settle or compromise any claim relating to a material amount of Taxes or a material Tax refund of the Company or any of the Company’s subsidiaries, enter into any “closing agreement” within the meaning of Section 7121 of the Code (or any analogous provision of state, local or foreign law) relating to a material amount of Taxes, surrender any right to claim a material Tax credit or refund, or consent to any extension or waiver of the statute of

 

85

limitations in respect of any material amount of Taxes (other than pursuant to automatic extensions of time to file Tax Returns obtained in the ordinary course of business);

 

•

waive, release, assign, settle or compromise any claims, liabilities or obligations arising out of, related to or in connection with litigation (other than litigation arising in connection with the Merger Agreement or the transactions contemplated hereby) or other Proceedings other than settlements of, or compromises for, any such litigation or other Proceedings (A) funded, subject to payment of a deductible or self-insured retention, solely by insurance coverage maintained by the Company or the Company’s subsidiaries, or (B) for less than five hundred thousand dollars ($500,000) individually or two million five hundred thousand dollars ($2,500,000) in the aggregate (net of any insurance coverage maintained by the Company or the Company’s subsidiaries), in each case (x) that would not grant any injunctive or equitable relief or impose any restrictions or changes on the business or operations of the Company or any of the Company’s subsidiaries, (y) without any admission of criminal act, wrongdoing or liability on the Company or Parent or any of their respective subsidiaries and (z) that provides for a general release of claims against the Company, any of the Company’s Subsidiaries as applicable, and their respective affiliates;

 

•

make any capital expenditure in excess of the amounts set forth in the Company’s capital expenditure budget made available to Parent, other than unbudgeted capital expenditures not in excess of two million five hundred thousand dollars ($2,500,000) in the aggregate per fiscal quarter;

 

•

enter into any Contract or transaction between the Company or any of the subsidiaries of the Company, on the one hand, and any affiliate or director or officer of the Company on the other hand, or enter into any other Contract or transaction with any other person, in each case, that would be required to be reported by the Company pursuant to Item 404 of Regulation S-K under the Exchange Act;

 

•

make any loans or advances (other than advances in the ordinary course of business for travel and other normal business expenses or any advancement of expenses under the Charter or Bylaws or equivalent governing documents of any of the Company’s subsidiaries), to stockholders, directors, officers or employees of the Company;

 

•

commence any new line of business in which it is not engaged as of the date of the Merger Agreement or new franchise system or discontinue any existing line of business;

 

•

other than in the ordinary course of business, and in each case, make any material change to the terms of the Company’s or any subsidiary of the Company system-wide policies or procedures with respect to (A) Franchisee royalty or other fees and charges, or (B) Franchisee incentives or Franchisee economic assistance (provided that in all cases the Company shall provide reasonable advance notice to, and reasonably consult with, Parent prior to any taking such material actions described in clauses (A) and (B));

 

•

except as required by any existing Contract made available to Parent, open any restaurant in a country where the Company or any subsidiary of the Company does not currently have an owned or franchised restaurant or otherwise engage in any other operations in any country in which the Company or any subsidiary of the Company does not currently conduct other operations;

 

•

fail to use commercially reasonable efforts to renew or maintain insurance policies maintained by the Company or any subsidiary of the Company or comparable replacement policies, other than in the ordinary course of business or form any captive insurance program;

 

•

enter into, adopt or authorize the adoption of any stockholder rights agreement, “poison pill” or similar antitakeover agreement or plan, or take any action to exempt any person from, or make any acquisition of securities of the Company by any person not subject to, any state takeover statute or similar statute or regulation or any similar anti-takeover provision in the Charter or the Bylaws, that applies to the Company, including the restrictions on “business combinations” set forth in Section 203 of the DGCL, except for Parent, Merger Sub, or any of their respective subsidiaries or affiliates, or the transactions contemplated by the Merger Agreement;

 

•

enter into any Contract with respect to the voting or registration of the shares of the Company’s or its subsidiaries’ capital stock or other securities, equity interests or ownership interests;

 

86

•

enter into any agreement (or commitment to enter into) to consummate a sale/leaseback or similar transaction with respect to the Company Owned Real Property, except for the Sale/Leaseback Transaction, or consummate any sale/leaseback or similar transactions with respect to the Company Owned Real Property, other than the consummation of the Sale/Leaseback Transaction (which, for the avoidance of doubt, shall be consummated on the Closing Date in accordance with the Sale/Leaseback Purchase and Sale Agreement and the Merger Agreement); or

 

•

authorize, agree or commit, in writing or otherwise, to do any of the foregoing.

No Solicitation

The Company has agreed, from and after the date of the Merger Agreement until the Effective Time, or, if earlier, the valid termination of the Merger Agreement, not to, and agreed to not authorize or permit its affiliates and its and their respective officers, directors, employees or representatives to, directly or indirectly, except as provided in the Merger Agreement:

 

•

initiate, solicit, induce, knowingly facilitate or knowingly encourage any inquiries, proposal, offer or request that constitutes, or would reasonably be expected to result in or lead to, a Company Acquisition Proposal (as defined below) or enter into, continue or otherwise participate or engage in any discussions or negotiations or provide access to its properties, books and records or any confidential information or data to, any person with respect thereto;

 

•

approve, endorse or recommend, or publicly propose to approve, endorse or recommend, any proposal or offer that constitutes, or would reasonably be expected to result in or lead to, a Company Acquisition Proposal;

 

•

execute or enter into any merger agreement, acquisition agreement, exchange agreement, joint venture agreement, partnership agreement, option agreement, letter of intent, memorandum of understanding, agreement in principle, confidentiality agreement or other similar agreement or arrangement for, relating to or that would reasonably be expected to result in or lead to any Company Acquisition Proposal; or

 

•

authorize any of, or commit, resolve or agree to do any of the foregoing.

The Company has also agreed to, and shall cause its subsidiaries, affiliates and its and their respective representatives to, promptly (and in any event within twenty-four (24) hours) cease any solicitation, discussion or negotiation with any persons (other than Parent and its affiliates and representatives on its behalf) then-existing with respect to any Company Acquisition Proposal, promptly (and in any event within twenty-four (24) hours) instruct each third party that has prior to the date hereof executed a confidentiality agreement in connection with a Company Acquisition Proposal or any inquiries, proposal, offer or request that constitutes, or would reasonably be expected to result in or lead to, a Company Acquisition Proposal to return or destroy all confidential information previously furnished to any such person or its representatives and promptly (and in any event within twenty-four (24) hours) terminate all physical and electronic data room access previously granted to any such person or its representatives.

Notwithstanding the foregoing restrictions, if at any time following the date of the Merger Agreement and prior to the Effective Time, the Company receives a bona fide written Company Acquisition Proposal from a third party, which Company Acquisition Proposal was made or renewed on or after the date of the Merger Agreement and which did not result from a breach (other than a de minimis breach) of the non-solicitation obligations set forth in the Merger Agreement, and the Board determines in good faith, after consultation with its financial advisors and outside counsel, that such Company Acquisition Proposal constitutes or would reasonably be expected to lead to a Superior Company Proposal (as defined below) and that failure to take such action would reasonably be expected to be inconsistent with the directors’ fiduciary duties under applicable law, then the Company may enter into an acceptable confidentiality agreement, not less restrictive of such person or group than the confidentiality agreement between the Company and TriArtisan Capital Advisors LLC (the “Confidentiality Agreement”), except that such confidentiality agreement (i) need not include any “standstill” or

 

87

similar obligations, (ii) shall expressly not prohibit the Company from complying with the Merger Agreement and (iii) need not contain any non-solicit or non-contact provisions similar to the Confidentiality Agreement if the counterparty thereto does not operate a business competitive with the Company and the Company’s subsidiaries, and only thereafter (A) furnish information with respect to itself and its subsidiaries to the person (or group of persons) making such proposal and its representatives and (B) participate in discussions or negotiations regarding such proposal with the person (or group of persons) making such proposal and its representatives pursuant to a customary confidentiality agreement.

The Merger Agreement also requires the Company to (1) promptly, and in any event within twenty-four (24) hours of receipt by the Company, notify Parent orally and in writing of any Company Acquisition Proposal or any proposal, offer, inquiry or request that constitutes, or would reasonably be expected to result in or lead to, a Company Acquisition Proposal, which notice shall include the material terms and conditions of any such Company Acquisition Proposal (including any changes thereto) and the identity of the person or group of persons making any such Company Acquisition Proposal (unless prohibited by a confidentiality agreement in effect as of the date of the Merger Agreement), such proposal, offer, inquiry or request and shall include with such notice unredacted copies of such proposal, offer, inquiry or request and copies of any other documents evidencing or specifying the terms and conditions of such proposal, offer, inquiry or request or, if not in writing, a written description of the material terms and conditions of such proposal, offer, inquiry or request and (2) keep Parent fully informed on a prompt basis (and in any event within twenty-four hours) of the status, material developments and material details (including amendments or proposed amendments) of any such proposal, offer, inquiry, request or Company Acquisition Proposal (including providing copies of any written documentation material received by the Company with respect thereto), including promptly (and in any event within twenty-four (24) hours) advising Parent if the Company determines to begin providing information to engage in discussions or negotiations concerning a Company Acquisition Proposal.

Nothing in the Merger Agreement prohibits the Company or the Board from (i) taking and disclosing to the stockholders of the Company a position contemplated by Rule 14e-2(a) promulgated under the Exchange Act, and complying with Rule 14d-9 promulgated under the Exchange Act and Item 1012(a) of Regulation M-A promulgated under the Exchange Act; (ii) making any disclosure to the stockholders of the Company if the Company Board determines in good faith, after consultation with the Company’s outside legal counsel, that such disclosure is required under applicable law; or (iii) issuing a “stop, look and listen” statement pending disclosure of its position, as contemplated by Rules 14d-9 and 14e-2(a) promulgated under the Exchange Act.

For purposes of the Merger Agreement, a “Denny’s Intervening Event” means any fact, change, condition, occurrence, effect, event, circumstance or development with respect to the Company and the subsidiaries of the Company, taken as a whole, that (a) was not known or reasonably foreseeable (with respect to substance or timing) to the Board, or a committee thereof, as of or prior to the date of the Merger Agreement (or if known or reasonably foreseeable, the consequences of which were not known or reasonably foreseeable to the Board as of or prior to the date of the Merger Agreement), and (b) first becomes known to the Board after the execution of the Merger Agreement and at any time prior to the Effective Time; provided, however, that the following shall not be deemed to be a Denny’s Intervening Event: any change, condition, occurrence, effect, event, circumstance or development that (i) involves or relates to a Company Acquisition Proposal or a Superior Company Proposal (which, for purposes of this definition, shall be read without reference to any percentages set forth in the definitions of “Company Acquisition Proposal” or “Superior Company Proposal”) or any inquiry or communications or matters relating thereto, or (ii) results from a breach of the Merger Agreement other than a de minimis breach by the Company.

For purposes of the Merger Agreement, a “Company Acquisition Proposal” means any offer or proposal from a third party (other than Parent, Merger Sub or their respective affiliates) concerning, in a single transaction or a series of related transactions, (a) a merger, consolidation, or other business combination transaction or series of related transactions involving the Company in which any person or group (as defined in Section 13(d) of the Exchange Act) would acquire beneficial ownership of equity interests representing twenty percent (20%) or more

 

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of the voting power of the Company; (b) a sale, lease, license, mortgage, pledge or other disposition, directly or indirectly, by merger, consolidation, business combination, share exchange, or otherwise, of assets of the Company (including equity interests of a Company subsidiary) or the Company subsidiaries representing twenty percent (20%) or more of the consolidated assets of the Company and the Company subsidiaries, based on their fair market value as determined in good faith by the Board; (c) an issuance or sale (including by way of merger, consolidation, business combination, share exchange, joint venture or otherwise) of equity interests representing twenty percent (20%) or more of the voting power of the Company or a tender offer or exchange offer in which any person or group (as defined in Section 13(d) of the Exchange Act) would acquire beneficial ownership, or the right to acquire beneficial ownership, of equity interests representing twenty percent (20%) or more of the voting power of the Company; or (d) any combination of the foregoing or any other transaction having similar effect (in each case, other than the Merger).

For purposes of the Merger Agreement, a “Superior Company Proposal” means a bona fide written Company Acquisition Proposal (except the references therein to “twenty percent (20%) or more” shall be replaced by “more than fifty percent (50%)”), made by a third party which the Board has determined, in the good faith judgment of the Board (after consultation with its financial advisors and outside legal counsel), taking into account such factors as the Board considers in good faith to be appropriate (including the conditionality, timing and likelihood of consummation of, and the person or group making, such proposals), (a) is reasonably likely to be consummated in accordance with its terms and (b) if consummated in accordance with its terms, would result in a transaction that is more favorable from a financial point of view to the Company stockholders (in their capacity as such) than the Merger and the other transactions contemplated by the Merger Agreement, in each case, taking into account any changes to the terms of the Merger Agreement proposed in writing by Parent, pursuant to, and in accordance with, the Merger Agreement and taking into account any legal, financial, timing, regulatory and approval considerations, the sources, availability and terms of any financing, financing market conditions and the existence of a financing contingency, the likelihood of termination, the timing of closing, and the identity of the person or persons making the Company Acquisition Proposal.

The Denny’s Corporation Board’s Recommendation; Adverse Recommendation Change

The Company has agreed under the Merger Agreement to, through the Board, recommend to the Company’s stockholders that they vote in favor of the adoption of the Merger Agreement, the Denny’s Recommendation, and to include such recommendation in this proxy statement.

The Merger Agreement provides that, subject to the exceptions described below, neither the Board nor any committee thereof, will take any of the following actions, such action referred to as a Denny’s Adverse Recommendation Change:

 

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withhold or withdraw (or change, modify, amend or qualify in a manner adverse to Parent or Merger Sub) (or publicly propose to withhold or withdraw (or change, modify, amend or qualify in a manner adverse to Parent or Merger Sub)), the Denny’s Recommendation;

 

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approve, endorse, adopt, recommend or otherwise declare advisable, or propose publicly to approve, recommend or declare advisable, any Company Acquisition Proposal;

 

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fail to include the Denny’s Recommendation in this proxy statement;

 

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if any Company Acquisition Proposal that is not subject to Regulation 14D under the Exchange Act has been made public, fail to reaffirm the Denny’s Recommendation upon request of Parent within the earlier of three business days prior to the then-scheduled Company Stockholder’s Meeting or ten business days after Parent requests in writing such reaffirmation with respect to such Company Acquisition Proposal; or

 

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fail to recommend, in a Solicitation/Recommendation Statement on Schedule 14D-9, against any Company Acquisition Proposal subject to Regulation 14D under the Exchange Act within ten business days after the commencement thereof.

 

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Further, the Company will not, and will use its reasonable best efforts to cause its subsidiaries and its and their representatives (on behalf of the Company of the Company’s subsidiaries) not to, approve, endorse or recommend or publicly propose to approve, endorse or recommend, or execute or enter into, any merger agreement, acquisition agreement, exchange agreement, joint venture agreement, partnership agreement, option agreement, letter of intent, memorandum of understanding, agreement in principle, confidentiality agreement or other similar agreement or arrangement for, relating to or that would reasonably be expected to result in or lead to any Company Acquisition Proposal (other than a permitted confidentiality agreement).

Notwithstanding the foregoing restrictions, at any time prior to obtaining the Denny’s Stockholder Approval, the Board may make a Denny’s Adverse Recommendation Change in response to either (A) a Superior Company Proposal that did not result from a breach of the Merger Agreement or (B) a Denny’s Intervening Event, if, in either case, the Board determines in good faith (after consultation with its outside counsel and financial advisors) that the failure to do so would be inconsistent with its fiduciary duties under applicable law. In the case of a Superior Company Proposal, the Board may also cause the Company to terminate the Merger Agreement to enter into a definitive agreement with respect to such Superior Company Proposal (so long as the Company pays the Denny’s Termination Fee as described below).

The Board may not make a Denny’s Adverse Recommendation Change or terminate the Merger Agreement to accept a Superior Company Proposal unless:

 

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it first provides Parent with at least four business days’ prior written notice (the “Company Notice Period”) of its intention to do so, which notice shall specify the material terms and conditions of such Company Acquisition Proposal (and have provided to Parent a copy of the available proposed transaction agreement to be entered into in respect of such Company Acquisition Proposal), or a detailed written description of such Denny’s Intervening Event, as applicable specifying the reasons therefor (including, in the case of a Superior Company Proposal, the identity of the person making it and the material terms thereof, or in the case of a Denny’s Intervening Event, a detailed description of such event);

 

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during the Company Notice Period, if requested by Parent, the Company and its representatives have engaged in good faith negotiations with Parent and its representatives regarding any adjustment or amendment to the Merger Agreement or any other agreement proposed in writing by Parent, and has caused its representatives to negotiate, with Parent in good faith (to the extent Parent desires to negotiate) to make such adjustments to the terms of the Merger Agreement so that the failure to make a Denny’s Adverse Recommendation Change would no longer be inconsistent with the Board’s fiduciary duties; and

 

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at the end of the Company Notice Period, after taking into account any proposals made by Parent to the Company amend the terms of the Merger Agreement during the Company Notice Period the Board determines in good faith (I) with respect to Superior Company Proposal, after consultation with its financial advisors and outside legal counsel that the Company Acquisition Proposal giving rise to the notice continues to constitute a Superior Company Proposal and (II) with respect to a Superior Company Proposal or a Denny’s Intervening Event, the failure to take such action would reasonably be expected to be inconsistent with the directors’ fiduciary duties under applicable law.

Any material amendment to a Superior Company Proposal will require a new notice and a new Company Notice Period.

Denny’s Corporation Stockholders Meeting

The Company is required to prepare and file the preliminary proxy statement with the SEC as promptly as reasonably practicable following the date of the Merger Agreement, and to use reasonable best efforts to respond to any comments by the SEC staff as promptly as reasonably practicable after the receipt thereof. The Company is also required to cause the definitive proxy statement to be mailed to the Company’s stockholders as promptly as practicable following the time the proxy statement is cleared by the SEC for mailing.

 

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The Company is required to duly give notice of, convene and hold a meeting of its stockholders as promptly as reasonably practicable to consider and vote upon a proposal to adopt the Merger Agreement (the “Denny’s Corporation Stockholders Meeting”) following the mailing of the definitive proxy statement, for the purpose of obtaining the Denny’s Stockholder Approval. The Company may only, after consultation with Parent, postpone or adjourn the Denny’s Corporation Stockholders Meeting (i) to solicit additional proxies for the purpose of obtaining the Denny’s Stockholder Approval, (ii) for the absence of a quorum and (iii) to allow reasonable additional time for the filing or mailing of any supplemental or amended disclosure that the Company has determined after consultation with outside legal counsel is reasonably likely to be required under applicable law and for such supplemental or amended disclosure to be disseminated and reviewed by stockholders of the Company prior to the Denny’s Corporation Stockholders Meeting.

If any event occurs with respect to the Company or any subsidiary of the Company, or any change occurs with respect to other information supplied by the Company for inclusion in the proxy statement, which is required to be described in an amendment of, or a supplement to, the proxy statement, the Company shall promptly notify Parent, and the Company and Parent shall cooperate in the prompt filing with the SEC of any necessary amendment or supplement. Subject to the provisions described in “—Conditions to the Consummation of the Merger” above, the Company is required, through the Board, to recommend that its stockholders adopt the Merger Agreement and to solicit from its stockholders proxies in favor of the adoption of the Merger Agreement.

Access to Information; Confidentiality

Subject to applicable law, the Company shall, and shall cause its subsidiaries to, afford to Parent and Merger Sub and their respective representatives, the Debt Financing Sources and the Sale/Leaseback Purchaser reasonable access during normal business hours in such a manner as not to interfere unreasonably with the operation of any business conducted by the Company and the Company’s subsidiaries, upon reasonable prior written notice, during the period prior to the Effective Time, to all of the Company’s officers, employees, properties, permits, offices and other facilities of the Company and the Company’s subsidiaries and to the books and records thereof. The Company must also use commercially reasonable efforts to furnish to Parent and Merger Sub and their respective representatives and the Debt Financing Sources and the Sale/Leaseback Purchaser, during normal business hours upon prior reasonable notice such information concerning the business, properties, contracts, permits, personnel, books and records (including tax records), assets and liabilities of the Company and the Company’s subsidiaries as Parent or Parent’s representatives and the Debt Financing Sources and the Sale/Leaseback Purchaser may reasonably request. The Company may (or cause any of the Company’s subsidiaries to) withhold information to the extent that the Company believes, in its reasonable good faith judgment that disclosure would (A) result in the loss of attorney-client, work product or other legal privilege of the Company or any of the Company’s subsidiaries, (B) breach, contravene or violate any effective and binding contract to which the Company or any of the Company’s subsidiaries is a party as of the date hereof, including any binding contractual obligations of the Company or any of the Company’s subsidiaries with respect to confidentiality to any third party, or (C) violate any applicable law (including competition laws). All information exchanged is subject to the Confidentiality Agreement.

Efforts to Complete the Merger; Regulatory Approvals

The Company and Parent have agreed to cooperate with each other and to use their respective reasonable best efforts to take, or cause to be taken, all appropriate action and do, or cause to be done, all things necessary, proper or advisable to consummate and make effective the Merger prior to the Outside Date. This includes preparing and filing as promptly as practicable all necessary documentation to obtain all required consents, authorizations, and regulatory approvals, if any. All regulatory filing fees shall be paid fifty (50%) percent by the Company and fifty (50%) percent by Parent.

Each party must use reasonable best efforts to obtain regulatory approvals as promptly as practicable and to defend against any action challenging the Merger under any antitrust law or foreign investment law. The parties

 

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shall be mutually responsible for substantive communications and strategic and timing decisions relating to the HSR Act or any other applicable antitrust laws, but if there is a disagreement that the parties cannot resolve, the determination of Parent shall prevail.

Parent must use reasonable best efforts to take, or cause to be taken, all appropriate action and do, or cause to be done, all things necessary, proper or advisable to enable the parties to close the Merger before the Outside Date. This includes proposing, negotiating, and agreeing to:

 

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selling or otherwise disposing of, or holding separate and agreeing to sell or otherwise dispose of, specific assets or categories of assets or areas of business of the Company;

 

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terminating any existing relationships and contractual rights and obligations of the Company;

 

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amending or terminating such existing licenses or other Intellectual Property agreements and entering into such new licenses or other Intellectual Property agreements; or

 

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making any behavioral commitments with respect to the Company’s assets or ability to conduct the business of the Company or its operations, divisions, businesses, or product lines or with any of its customers.

However, the parties are not required to agree to take any action that is not conditioned upon the Merger, or that would reasonably be expected to have a material adverse impact on the Company or the benefits expected from the Merger.

Neither party, nor their respective affiliates, may enter into any transaction that would reasonably be expected to prevent or materially delay obtaining any required regulatory approvals for the Merger.

Indemnification, Exculpation and Insurance

Parent has agreed that, for six years from and after the Effective Time, all rights to indemnification, advancement of expenses and exculpation in favor of each former and present director or officer of the Company or any of its subsidiaries (each, an “Indemnified Party”), as provided in the Charter, Bylaws the certificate of incorporate and bylaws, or equivalent organizational or governing documents of any of the Company’s subsidiaries or in certain indemnification agreements in effect on the date of the Merger Agreement, will survive the Merger and continue in full force and effect, and such documents shall contain indemnification provisions no less favorable in the aggregate than are currently set forth therein.

For a period of six years from and after the Effective Time, the Surviving Company will, and Parent will cause to Surviving Company to, maintain in effect the coverage provided by the current policies of directors’ and officers’ liability insurance and fiduciary liability insurance maintained by the Company, subject to an expense cap. In lieu of this obligation, a six-year prepaid “tail” policy may be purchased on terms and conditions not less favorable to the insured persons than the existing coverage, covering claims arising from facts or events that occurred on or before the Effective Time.

In the event that Parent or the Surviving Company (i) consolidates with or merges into any other person and shall not be the continuing or surviving corporation or entity of such consolidation or merger, or (ii) transfers all or substantially all of its properties and assets to any person, proper provision will be made so that such continuing or surviving corporation or entity or transferee of such assets, as the case may be, will assume these indemnification and insurance obligations.

These provisions are intended for the benefit of, and will be enforceable by, each Indemnified Party.

Employee Matters

For a period of one year following the Effective Time, each employee of the Company who continues employment with Parent, the Surviving Company or any of their affiliates on or after the Effective Time (each, a

 

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“Continuing Employee”) will be provided with (i) a base salary or wage rate and target short-term incentive cash compensation opportunity that, in each case, is no less favorable than that provided to the Continuing Employee immediately before the Effective Time, (ii) severance benefits and protections that are no less favorable than those provided to such Continuing Employee under the applicable severance plans of the Company, including, if applicable, the Severance Plan, immediately prior to the Effective Time, and (iii) broad-based retirement, health and welfare benefits (excluding change-in-control or transaction-based payments becoming due or payable in connection with the Merger, fringe benefits, non-qualified deferred compensation, post-employment or welfare benefits, equity or equity-based compensation, and defined benefit pension benefits) that are substantially similar in the aggregate to those provided to the Continuing Employee immediately before the Effective Time.

With respect to any employee benefit plans in which Continuing Employees are eligible to participate after the closing, Parent will use commercially reasonable efforts to (i) waive any pre-existing condition exclusions, waiting periods, and actively at-work requirements, and (ii) give credit for any eligible expenses incurred during the plan year in which the Effective Time occurs for purposes of satisfying deductible, coinsurance and out-of-pocket maximums.

Parent will use commercially reasonable efforts to provide credit to Continuing Employees for their service with the Company for purposes of eligibility to participate, vesting and for calculating vacation and severance entitlements (but not for benefits accrual purposes) under Parent’s (or its subsidiaries’) applicable benefit plans to the same extent as such Continuing Employees were entitled under the Company’s employee benefit plans prior to the Effective Time, except where it would result in a duplication of benefits.

In the event that the Closing Date occurs prior to the payment of annual bonuses under the Company’s cash incentive plan with respect to the 2025 calendar year, Parent and its affiliates will cause each Continuing Employee to be paid the Pro-Rated 2025 Bonuses no later than February 28, 2026. The amount of the Pro-Rated 2025 Bonuses will be based on (i) actual performance of the performance goals through the Closing Date, and (ii) target performance for the period between the Closing Date and December 31, 2025. Any Continuing Employee who participates in the Executive Severance Plan or Key Employee Severance Plan and terminates without “cause” prior to December 31, 2025 will be entitled to receive such prorated bonus (subject to a release of claims) promptly following after the effective date of such release (provided that such employee will be entitled to receive any greater pro rata annual bonus amount under the Executive Severance Plan or Key Employee Severance Plan, as applicable, without duplication of his or her Pro-Rated 2025 Bonus).

The Company will take all actions necessary to terminate, effective no later than the day immediately preceding the Closing Date, the Company’s NQDC Plans, which include the Deferred Compensation Plan, as amended and restated (including the deferred Company PSU Awards thereunder), deferred Company RSU Awards (to the extent subject to Section 409A) and deferred stock units.

These provisions do not create any third-party beneficiary rights for any employee and do not limit the Company’s or any of its affiliates’ or the Surviving Company’s or any of its subsidiaries’ right to amend, modify, or terminate in accordance with its terms any benefit or compensation plan, program, agreement, contract, policy, scheme or arrangement at any time assumed, established, sponsored or maintained by any of them or terminate the employment of any employee.

Parent has acknowledged that the Merger will constitute a “change in control” for purposes of the Company Equity Plans, the Severance Plan, and the Deferred Compensation Plan, and has agreed to honor the terms of such plans.

Financing; Financing Cooperation

Each of Parent and Merger Sub has agreed to use their respective reasonable best efforts to arrange, obtain and consummate the equity financing for the Merger (the “Equity Financing”) in an amount required to satisfy

 

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the applicable portion of the Required Amount contemplated by the Equity Commitment Letter at the Closing Date on the terms and conditions described in the Equity Commitment Letter. Each of Parent and Merger Sub will not, without the Company’s written consent, permit any amendment or modification to be made to, or any waiver of any provision or remedy pursuant to, the Equity Commitment Letter if such amendment, modification or waiver would (A) impose new or additional conditions precedent to the funding of the Equity Financing or would otherwise materially change, amend, modify or expand any of the conditions precedent to the funding of the Equity Financing, (B) be reasonably expected to prevent or materially delay the availability of all or a portion of the Equity Financing necessary to pay the applicable portion of the Required Amount contemplated by the Equity Commitment Letter or the consummation of the transactions contemplated by the Merger Agreement, (C) reduce the aggregate amount of the Equity Financing below the amount necessary to pay the applicable portion of the Required Amount contemplated by the Equity Commitment Letter (unless accompanied by a corresponding increase in the portion of the Required Amount contemplated by the Debt Commitment Letter), or (D) otherwise materially adversely affect the ability of Parent or Merger Sub to enforce their rights under the Equity Commitment Letter. Each of Parent and Merger Sub shall use their respective reasonable best efforts to (i) maintain in full force and effect the Equity Commitment Letter and the Limited Guarantee until the earliest of the consummation of the transactions contemplated by the Merger Agreement or the valid termination of the Merger Agreement, (ii) satisfy, or cause to be satisfied, on a timely basis, to the extent within their control, all conditions and covenants to the funding or investing of the Equity Financing required to pay the applicable portion of the Required Amount contemplated by the Equity Commitment Letter that are to be satisfied by Parent or Merger Sub, (iii) if the conditions to the Equity Financing set forth in the Equity Commitment Letter have been satisfied and the conditions set forth in the Merger Agreement (other than those to be satisfied at the Closing, but subject to the satisfaction or waiver of those conditions at the Closing) have been satisfied or waived, consummate the Equity Financing in an amount required to pay the applicable portion of the Required Amount contemplated by the Equity Commitment Letter, or enforce the Limited Guarantee, in accordance with its terms, and (iv) enforce its rights under the Equity Commitment Letter and the Limited Guarantee. Neither Parent nor Merger Sub will release or consent to the termination of the obligations of the Investor to provide the Equity Financing in an amount required to pay the Required Amount contemplated by the Equity Commitment Letter. Notwithstanding anything to the contrary contained in the Merger Agreement, in no event will the reasonable best efforts of Parent or Merger Sub be deemed or construed to require, either Parent or Merger Sub to seek the Equity Financing from any source other than a counterparty to, or in any amount in excess of that contemplated by, the Equity Commitment Letter.

Parent has agreed to give the Company, as promptly as reasonably practicable, written notice after Parent’s knowledge (i) of any material default or material breach (or any event that, with or without notice, lapse of time or both, would, or would reasonably be expected to, give rise to any material default or material breach) by any party under the Equity Commitment Letter of which Parent or Merger Sub becomes aware, (ii) of any termination of the Equity Commitment Letter by Parent or Merger Sub or of the receipt by Parent or Merger Sub of written notice of termination of the Equity Commitment Letter by the Investor, (iii) of the receipt by Parent or Merger Sub of any written notice or other written communication from the Investor with respect to any actual or asserted material default, breach, termination or repudiation of the Equity Commitment Letter, or any material provision thereof, in each case by any party thereto, and (iv) of the occurrence of an event or development that would reasonably be expected to materially adversely impact the ability of Parent or Merger Sub to obtain all or any portion of the Equity Financing necessary to pay the applicable portion of the Required Amount contemplated by the Equity Commitment Letter. Without limitation of the foregoing, upon the reasonable written request of the Company from time to time, Parent will, as promptly as reasonably practicable, update the Company on the material activity and developments of its efforts to arrange and obtain the Equity Financing, including by providing copies of all definitive agreements (and drafts of all offering documents and marketing materials) related to the Equity Financing, and any amendments, modifications or replacements to the Equity Commitment Letter.

During the period from the date of the Merger Agreement until the earlier to occur of the Closing Date and the termination of the Merger Agreement, Parent will cause Borrower to use its reasonable best efforts to arrange

 

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and obtain the debt financing for the Merger (the “Debt Financing”) on the terms and subject to the conditions described in the Debt Commitment Letter, including using its reasonable best efforts to (i) maintain in full force and effect the Debt Commitment Letter in accordance with the terms and subject to the conditions set forth therein (after giving effect to any “market flex” provisions set forth in the Debt Fee Letter), (ii) satisfy, or cause to be satisfied, on a timely basis, all conditions (after giving effect to any “market flex” provisions set forth in the Debt Fee Letter) to funding the Required Debt Amount at Closing that are to be satisfied by, and are within the control of, Borrower, (iii) negotiate and enter into definitive agreements with respect to the Debt Financing on the terms and subject to conditions materially consistent with those terms contemplated by the Debt Commitment Letter (including any related “market flex” provisions set forth in the Debt Fee Letter) or on other terms that are (A) acceptable to the Debt Financing Sources and (B) in the aggregate not materially less favorable (as determined by Parent in good faith), taken as a whole, to Borrower (including with respect to conditions set forth in the Debt Commitment Letter) than those terms and conditions set forth in the Debt Commitment Letter, and (iv) consummate and obtain the Debt Financing in an amount equal to the Required Debt Amount. Parent and Merger Sub will give the Company prompt written notice (A) of any material breach or default (or any event or circumstance that, with or without notice, lapse of time or both, would reasonably be expected to result in a material breach or default) by any party to the Debt Commitment Letter of which Parent or Merger Sub becomes aware, (B) if and when Parent and/or Merger Sub becomes aware that any portion of the Required Debt Amount may not be available at the Closing, (C) of the receipt of any written notice or other written communication from any person with respect to any (1) actual or potential breach, default, termination or repudiation by any party to the Debt Commitment Letter, or (2) material dispute or disagreement between or among Parent or Borrower, on the one hand, and any Debt Financing Sources, on the other hand, with respect to the obligation to fund the Required Debt Amount at the Closing (but excluding, for the avoidance of doubt, any ordinary course negotiations with respect to the terms of the Debt Financing), and (D) of any expiration or termination of the Debt Commitment Letter. As soon as reasonably practicable, Parent and/or Merger Sub will provide any information available to Parent and/or Merger Sub, as applicable, and reasonably requested by the Company relating to any circumstance referred to in clause (A), (B), (C) or (D) of the immediately preceding sentence. Without limiting the foregoing, Parent and Merger Sub will keep the Company informed on a reasonably current basis and in reasonable detail of the status of their efforts to arrange the Debt Financing and provide to the Company executed copies of any amendments or modifications to the Debt Commitment Letter or the Debt Fee Letter or to the Alternative Financing as described below (provided that any fee letters, engagement letters or other agreements may be redacted solely as to fee amounts, “market flex” provisions, discounts, pricing caps and other commercially sensitive terms that are customarily redacted). If any portion of the Required Debt Amount becomes, or would reasonably be expected to become, unavailable (whether through expiration, termination or otherwise) on the terms and conditions contemplated by the Debt Commitment Letter (after taking into account any “market flex” provisions set forth in the Debt Fee Letter), Parent will cause Borrower use its reasonable best efforts to arrange and obtain alternative financing, including from alternative sources, on terms and conditions that in the aggregate are not less favorable to Borrower (including with respect to any conditions to the Debt Financing), as determined by Parent in good faith, than the Debt Financing contemplated by the Debt Commitment Letter and in an amount that is sufficient to replace any unavailable portion of the Required Debt Amount (the “Alternative Financing”) as promptly as practicable following the occurrence of such event, and the provisions of the Merger Agreement will be applicable to the Alternative Financing, and for purposes of the Merger Agreement all references to the Debt Financing will be deemed to include such Alternative Financing and all references to the Debt Commitment Letter or Debt Fee Letter will include the applicable documents for the Alternative Financing. Nothing in Merger Agreement or any other provision of the Merger Agreement will require, and in no event will the “reasonable best efforts” of Borrower be deemed or construed to require Parent, Merger Sub or Borrower to (taking into account any “market flex” provisions applicable to the Debt Financing): (i) accept financing on terms or subject to conditions that are materially less favorable, taken as a whole, than those set forth in the Debt Commitment Letter (as determined by Parent in good faith), (ii) waive any term or condition of the Merger Agreement or (iii) pay any fees or any interest rates that exceed, in any material respect those contemplated by the Debt Commitment Letter as in effect on the date hereof (whether to secure a waiver of any conditions contained therein or otherwise). Parent and Merger Sub will not permit, without the prior written consent of the Company (not to be unreasonably conditioned, withheld or delayed), any material amendment or

 

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modification to be made to, or any termination, rescission or withdrawal of, or any material waiver of any provision or remedy under, the Debt Commitment Letter or the Debt Fee Letter, if any such amendment, modification or waiver that (individually or in the aggregate with any other amendments, modifications or waivers) would reasonably be expected to (x) reduce the aggregate amount of the Debt Financing contemplated to be funded at Closing to be less than the Required Debt Amount (including by changing the amount of fees to be paid or original issue discount thereof), or (y) impose any new or additional condition, or otherwise amend, modify or expand any condition, to the receipt of any portion of the Required Debt Amount in a manner that would reasonably be expected to (I) materially delay or prevent the Closing Date, (II) make the funding of any portion of the Required Debt Amount (or satisfaction of any condition to obtaining any portion of the Required Debt Amount) less likely to occur, or (III) adversely impact the ability of Parent or Merger Sub to consummate the transactions contemplated hereby; provided that, notwithstanding the foregoing, the Debt Commitment Letter may be amended without the consent of any party to the Merger Agreement to (i) add additional agents, co-agents, lenders, lead arrangers, bookrunners, syndication agents, managers or similar entities who have not executed the Debt Commitment Letter as of the date hereof, (ii) comply with the “market flex” provisions contained in the Debt Fee Letter and (iii) make any conforming or ministerial changes thereto. Notwithstanding anything to the contrary in the Merger Agreement, compliance by Parent and Merger Sub with this provision of the Merger Agreement will not relieve Parent and Merger Sub of the respective obligation to consummate the transactions contemplated by the Merger Agreement, whether or not the Debt Financing or the Alternative Financing is available. Parent will promptly deliver to the Company true and complete copies of all agreements pursuant to which any such Alternative Financing source will have committed to provide Parent, Borrower and/or Merger Sub with any portion of such Alternative Financing.

Prior to the Closing, the Company has agreed, and has agreed to cause each of the Company’s subsidiaries and its and their respective representatives to, use reasonable best efforts, at Parent’s sole expense (other than with respect to any expenses incurred by the Company and the Company’s subsidiaries that would otherwise have been incurred in the ordinary course of business), to cooperate with Parent in connection with the arrangement and consummation of the Debt Financing as may be customary and reasonably requested by Parent, including using reasonable best efforts to (i) participate at reasonable times in a commercially reasonable number of meetings, drafting sessions, presentations, road shows, and rating agency and other due diligence sessions, including direct contact between senior management and the other representatives of the Company, on the one hand, and the actual and potential Debt Financing Sources, on the other hand, in each case, upon reasonable advance notice, (ii) furnish Parent and the Debt Financing Sources with financial and other pertinent information regarding the Company and the Company’s subsidiaries as may be reasonably requested by Parent (provided, that, for the avoidance of doubt, the Company will not be required to provide, and Parent and/or its affiliates will be solely responsible for, (A) the preparation of any pro forma financial information, including pro forma cost savings, synergies, capitalization or other pro forma adjustments desired to be incorporated into any pro forma financial information or (B) projections, risk factors or other forward-looking statements relating to all or any component of the Debt Financing), (iii) assist Parent and the Debt Financing Sources in the preparation of bank information memoranda and similar documents for the Debt Financing, (iv) cooperate with Parent’s legal counsel in connection with any legal opinions that such legal counsel may be required to deliver in connection with the Debt Financing as reasonably requested by Parent, (v) assist with the preparation, execution and delivery of definitive financing documentation (including a perfection certificate and a certificate of the chief financial officer (or person performing similar functions) of the Company with respect to solvency matters in the form attached to the Debt Commitment Letter (or substantially similar provisions in any Alternative Financing)) and the schedules and exhibits thereto, in each case, as may be reasonably requested by Parent, (vi) assist with the pledging of, and granting of liens on, collateral for the Debt Financing and providing reasonable assistance to facilitate at (but not prior to) the Closing the release of liens (other than permitted liens) on the assets of the Company and the Company’s subsidiaries, (vii) cooperate with the satisfaction of the conditions precedent set forth in the Debt Commitment Letter or any definitive document relating to the Debt Financing to the extent the satisfaction of such condition requires the cooperation of, or is within the control of, the Company or any of the Company’s subsidiaries, (viii) take corporate actions, subject to and conditioned upon the occurrence of the Closing, reasonably necessary to permit the consummation of the Debt Financing and to ensure that the Debt

 

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Financing Sources benefit materially from existing lending relationships of the Company and the Company’s subsidiaries and (ix) provide to Parent and the Debt Financing Sources at least four business days prior to the Closing Date all documentation and other information regarding the Company and the Company Subsidiaries required by regulatory authorities under applicable “know your customer” and anti-money laundering rules and regulations, including the PATRIOT Act and the Beneficial Ownership Regulation (31 C.F.R. § 1010.230) to the extent requested at least eight (8) days prior to the Closing, so long as, in each case, (A) neither the Company nor any of the Company’s subsidiaries will be required to incur any liability (including the payment of any fees) in connection with the Debt Financing prior to the Closing Date (other than any costs, expenses or indemnities that will be promptly reimbursed by Parent), (B) prior to the Closing Date, the Board (and the equivalent governing body of any of the Company’s subsidiaries) will not be required to adopt resolutions approving the agreements, documents and instruments pursuant to which the Debt Financing is obtained that are not contingent on the Closing, (C) neither the Company nor any Company Subsidiary will be required to execute prior to the Closing Date any definitive financing documents, including any credit or other agreements, pledge or security documents, or other certificates, legal opinions or documents in connection with the Debt Financing, other than such documents and agreements that are contingent on the Closing, (D) neither the Company nor any of the Company’s subsidiaries will be required to take any action that would reasonably be expected to conflict with, or result in a violation or breach of, or default (with or without notice or lapse of time) under the Charter, the Bylaws, or the certificate of incorporation and bylaws, or equivalent organizational documents, of any of the Company’s subsidiaries, any applicable law or any contract to which the Company or any of the Company’s subsidiaries is a party, and (E) neither the Company nor any of the Company’s subsidiaries will be required to provide any assistance or cooperation that would (1) unreasonably interfere with its respective business operations, (2) cause any representation or warranty in the Merger Agreement made by the Company to be breached, or (3) cause any conditions set forth in the Merger Agreement to fail to be satisfied. Except for the representations and warranties of the Company set forth in the Merger Agreement, neither the Company nor any of the Company’s subsidiaries will have any liability to Parent in respect of any financial statements, other financial information, or data or other information provided pursuant to the Merger Agreement, except to the extent resulting from the willful misconduct, gross negligence, fraud or intentional misrepresentation of the Company, any of the Company’s subsidiaries, or their respective representatives.

Except to the extent arising from the willful misconduct, gross negligence, fraud or intentional misrepresentation of the Company, the Company’s subsidiaries or their respective affiliates or representatives, Parent and Merger Sub will indemnify, defend and hold harmless the Company and the Company’s subsidiaries, and their respective directors, officers, employees and representatives from and against any and all damages (excluding lost profits and losses from any consequential, indirect, special or punitive damages (as opposed to direct or actual damages)) incurred, directly or indirectly, in connection with the performance of their respective obligations under financing cooperation provisions of the Merger Agreement and any information provided in connection therewith (other than on account of historical financial information or other information furnished in writing by or on behalf of the Company or any of the Company’s subsidiaries). Upon the earlier of immediately prior to the Closing and the termination of the Merger Agreement in accordance with its terms, Parent will promptly reimburse the Company and the Company’s subsidiaries, as applicable, for all reasonable, documented and invoiced out-of-pocket costs (including reasonable and documented out-of-pocket attorneys’ fees) incurred by the Company or the Company’s subsidiaries in connection with the performance of their respective obligations under the financing cooperation provisions of the Merger Agreement (excluding, for the avoidance of doubt, any costs and expenses that would have been incurred independently of any obligations under the financing cooperation provisions of the Merger Agreement).

Consummation of the Merger is not conditioned on Parent obtaining the Equity Financing, the Debt Financing or any alternative financing.

Sale/Leaseback Transaction

Merger Sub intends to engage in a sale/leaseback transaction (the “Sale/Leaseback Transaction”) (or cause the Company to enter into a sale/leaseback transaction) whereby the Company Owned Real Property would be

 

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conveyed to the applicable purchaser (the “Sale/Leaseback Purchaser”) contemporaneously with the Merger and then leased back from the Sale/Leaseback Purchaser. The Company has agreed that it will reasonably cooperate in good faith in connection with the facilitation of the Sale/Leaseback Transaction, including by assisting Parent and Merger Sub in obtaining waivers, consents, estoppels and approvals from counterparties to Franchisee leases, liens and other agreements relating to the Company and the Company’s subsidiaries with respect to the Sale/Leaseback Transaction and obtaining amendments to the Franchisee leases, in each case as required to be delivered by the terms of the Sale/Leaseback Purchase and Sale Agreement (so long as such waivers, consents, estoppels or approvals requested by Parent or the Sale/Leaseback Purchaser are customary in form and substance for similar transactions, and that such amendments are in substantially the form of the related amendments entered into prior to the date hereof). Further, the Company has agreed that it will use reasonable best efforts to assist Parent and Merger Sub to provide preliminary title commitments, surveys, zoning reports, and Phase I environmental site assessments with respect to the Company Owned Real Property to Sale/Leaseback Purchaser, will coordinate with, and liaise between, the Sale/Leaseback Purchaser and the applicable third party diligence providers (including the title company, surveyor, zoning report provider and environmental consultant), and will use its reasonable best efforts to cause the satisfaction and release of record of any liens required to be satisfied and released in accordance with the terms of the Sale/Leaseback Purchase and Sale Agreement (it being understood and agreed that the Company has agreed to satisfy any mortgages, deeds of trust, mechanics lien, tax lien, and/or judgment lien affecting a Company Owned Real Property created by the Company). In addition, the Company has agreed that in connection with the Sale/Leaseback Transaction, it will cooperate in all reasonable respects and within its reasonable control to: ensure the satisfaction of the applicable seller’s covenants and seller conditions precedent under the Sale/Leaseback Purchase and Sale Agreement and to facilitate the conveyance of the Company Owned Real Property to the Sale/Leaseback Purchaser, subject only to the title encumbrances permitted under the Sale/Leaseback Purchase and Sale Agreement, simultaneously with, and conditioned upon, the Closing in respect of the other transactions hereunder; and, subject to such conditions, the Company has agreed to execute any reasonable documentation that is customary in form and substance (and which executed documents the Company may deliver into escrow subject to the Company’s reasonable escrow instructions) in connection with the consummation of such real property conveyance, including executing closing documents required to be delivered by seller under and in accordance with the terms of the Sale/Leaseback Purchase and Sale Agreement, and taking all corporate action reasonably necessary to permit the consummation of the Sale/Leaseback Transaction. In anticipation thereof, the Company has agreed, insofar as in its reasonable control, to assist and cooperate in coordinating any loan payoff and the preparation by others of any related termination documentation in connection with any mortgage and/or deed of trust that presently encumbers the Company Owned Real Property and supplying such other reasonable information and documentation in its possession or readily available at no additional out of pocket cost to the Company in order to facilitate the conveyance of the Company Owned Real Property to the Sale/Leaseback Purchaser.

Treatment of the Company’s Indebtedness

As of the date of the Merger Agreement, the Company had $271,500,000 of loans outstanding and $16,463,782 in outstanding letters of credit under the Company Credit Facility. The Company shall take all actions required to pay off and release all liens on the property and assets of the Company and its subsidiaries with respect to the indebtedness of the Company and its subsidiaries for borrowed money.

Other Agreements

The Merger Agreement contains certain other covenants and agreements, including covenants and agreements relating to, among other things, and subject to certain exceptions and qualifications described in the Merger Agreement:

 

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access to information

 

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cooperation between the Company and Parent in connection with certain litigation relating to the Merger;

 

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the Company taking steps to ensure that dispositions of Denny’s Corporation stock by its officers and directors are exempt under Rule 16b-3 of the Exchange Act;

 

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consultation between the Company and Parent in connection with public announcements regarding the Merger;

 

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cooperation to cause the delisting of the Company’s Common Stock from Nasdaq as promptly as practicable after the Effective Time;

 

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taking actions to eliminate or minimize the effects of any antitakeover statutes; and

 

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notification with respect to certain matters.

Termination of the Merger Agreement

The Merger Agreement may be terminated at any time prior to the Effective Time:

 

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By the mutual written agreement of the Company and Parent.

 

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By either the Company or Parent if:

 

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the Merger has not been consummated by June 30, 2026 (as such date may be extended by the mutual written consent of the parties, the “Outside Date”), which termination right is not available to a party whose material breach of the Merger Agreement was the principal cause of the failure of the Effective Time to occur by the Outside Date;

 

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any governmental entity of competent and applicable jurisdiction shall have issued or enacted a Legal Restraint, and such Legal Restraint shall have become final and nonappealable, which termination right will be available only if the party seeking to terminate the Merger Agreement shall have complied in all material respects with its applicable efforts obligations under the Merger Agreement; or

 

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the Denny’s Stockholder Approval has not been obtained at the Company Stockholders’ Meeting or at any adjournment or postponement thereof.

 

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By Parent if:

 

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the Company has breached its representations, warranties, or covenants such that a closing condition would not be satisfied, and such breach is not cured within 30 days of notice (so long as Parent is not then in material breach of its own obligations); or

 

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prior to the Denny’s Stockholder Approval, the Board has made a Denny’s Adverse Recommendation Change.

 

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By the Company if:

 

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Parent or Merger Sub has breached their representations, warranties, or covenants such that a closing condition would not be satisfied, and such breach is not cured within 30 days of notice (so long as the Company is not then in material breach of its own obligations);

 

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the closing conditions have been satisfied (other than those conditions that by their nature are to be satisfied as of the Closing, but subject to such conditions being able to be satisfied or waived at the Closing) but Parent fails to consummate the Merger within three business days after the Company confirms that the Company is ready, willing and able to consummate the Merger; or

 

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at any time prior to obtaining the Denny’s Stockholder Approval, to enter into a definitive agreement with respect to a Superior Company Proposal, so long as the Company has complied with its non-solicitation obligations and concurrently pays Parent the Denny’s Termination Fee (as defined below) and applicable reimbursements and, substantially concurrently with such termination, the Company enters into a definitive agreement with respect to such Superior Company Proposal.

 

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If the Merger Agreement is terminated, it will become void, without liability on the part of any party, except in the case of fraud or a willful and material breach of the Merger Agreement prior to termination. Certain provisions, including those relating to confidentiality, the effect of termination, payment of fees and expenses, and governing law, will survive termination.

Fees and Expenses; Termination Fees

Generally, each party is required to pay its own fees and expenses, except that all regulatory filing fees shall be paid fifty (50%) percent by the Company and fifty (50%) percent by Parent.

In addition, upon termination of the Merger Agreement under specified circumstances, certain fees will become payable by either the Company to Parent (or its designee) or Parent to the Company.

The Company will pay Parent (or its designee) a termination fee of $10,320,000 (the “Denny’s Termination Fee”) if:

 

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Parent terminates the Merger Agreement because the Board made a Denny’s Adverse Recommendation Change;

 

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the Company terminates the Merger Agreement to enter into a definitive agreement with respect to a Superior Company Proposal; or

 

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(A) the Merger Agreement is terminated by either the Company or Parent due to the Outside Date having passed, (B) the Merger Agreement is terminated by either the Company or Parent due to a failure to obtain the Denny’s Stockholder Approval at the Company Stockholders’ Meeting, or (C) the Merger Agreement is terminated by Parent if (i) there has been a breach by the Company of its representations, warranties or covenants contained in the Merger Agreement, or if any representation or warranty of Parent or Merger Sub has become untrue, in each case, such that the conditions to the obligations of Parent and Merger Sub to effect the Merger could not be satisfied as of the Closing Date, (ii) Parent has delivered to the Company written notice of such breach, and (iii) such breach is not capable of cure or shall not have been cured within the earlier of the Outside Date or 30 days from the date of delivery of such written notice to the Company; provided, that Parent will not be permitted to terminate the Merger Agreement pursuant to this clause (C) if either Parent or Merger Sub are then in material breach of their respective obligations under the Merger Agreement, and in each case with respect to clauses (A), (B) and (C), (x) after the date of the Merger Agreement and prior to the date of such termination, a bona fide Company Acquisition Proposal was made to the Board or was publicly made director to the Company’s stockholders generally, and in either case such Company Acquisition Proposal has not been unconditionally withdrawn or otherwise abandoned prior to such termination and (y) within twelve months of such termination, the transactions contemplated by any Company Acquisition Proposal are consummated or the Company enters into a definitive agreement providing for any transaction that constitutes a Company Acquisition Proposal. For purposes of this provision, all references to “20%” in the definition of “Company Acquisition Proposal” are deemed to be “50%.”

Parent will pay the Company a termination fee of $17,200,000 if:

 

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the Company terminates the Merger Agreement if (i) Parent or Merger Sub has breached its representations, warranties, or covenants or if any representation or warranty of Parent or Merger Sub has become untrue, in each case, such that one or more of the conditions to Closing related to (a) Parent and Merger Sub’s representations and warranties being true and correct both as of the date of the Merger Agreement and as of the Closing Date as though made on and as of the Closing Date (except to the extent expressly made as of an early date, in which case as of such earlier date), except where the failure of any such representations and warranties to be true and correct, individually or in the aggregate, would not reasonably be expected to have a Parent Material Adverse Effect, as the case may be, could not be satisfied as of the Closing Date or (b) Parent and Merger Sub having performed in all material respects all obligations and complied in all

 

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material respects with all covenants required to be performed or complied with by them under the Merger Agreement at or prior to the Closing, as the case may be, could not be satisfied as of the Closing Date, (ii) the Company has delivered to Parent written notice of such breach, and (iii) such breach is not capable of cure or shall not have been cured within the earlier of the Outside Date or thirty (30) days from the date of delivery of such written notice to Parent; provided, that the Company shall not be permitted to terminate the Merger Agreement pursuant to this provision if the Company is then in material breach of its obligations under the Merger Agreement;

 

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the Company terminates the Merger Agreement if (1) the conditions of each party’s obligations to effect the Merger and of Parent and Merger Sub’s obligations to effect the Merger as set forth in the Merger Agreement (other than those conditions that by their nature are to be satisfied as of the Closing, but subject to such conditions being able to be satisfied or waived at the Closing) have been satisfied or waived in accordance with the Merger Agreement, (2) Parent and Merger Sub have failed to consummate the Merger on the date on which the Closing should have occurred pursuant to the Merger Agreement, (3) the Company has irrevocably confirmed by written notice to Parent of the Company’s intention to terminate the Merger Agreement pursuant to this provision if Parent and Merger Sub fail to consummate the Merger within three business days following the date of the Company’s delivery of such notice and indicating that the Company is ready, willing and able to consummate the transactions contemplated by the Merger Agreement on the terms contemplated hereby, and (4) Parent and Merger Sub fail to consummate the Merger prior to the expiration of such three business day period (it being understood that, notwithstanding anything to the contrary in the Merger Agreement, no party will be permitted to terminate the Merger Agreement during such three business day period); or

 

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the Merger Agreement is terminated by either the Company or Parent, if the Effective Time shall not have occurred by the Outside Date under circumstances in which the Company would have been entitled to terminate the Merger Agreement pursuant to the prior two bullet points.

If the Company or Parent, as the case may be, fails to timely pay the Denny’s Termination Fee or the Parent Termination Fee, as applicable, and, in order to obtain the payment, Parent or the Company, as the case may be, commences a proceeding which results in a judgment against the other party for the Denny’s Termination Fee or the Parent Termination Fee, as applicable, such paying party shall pay the other party’s reasonable and documented costs and expenses (including reasonable and documented attorneys’ fees) in connection with such proceeding, (which, in the case of a payment by Parent, aggregated with any amounts payable by Parent to the Company under the financing cooperation provisions of the Merger Agreement), not to exceed one million five hundred thousand dollars ($1,500,000), together with interest on such amount at the prime rate as published in The Wall Street Journal in effect on the date such payment was required to be made, through the date such payment is actually received.

Exclusive Remedy

Except in the case of fraud or a willful and material breach, if a termination fee becomes payable, the payment of such fee will be the sole and exclusive remedy (whether at law, in equity, in contract, in tort or otherwise) of the receiving party any Parent Related Party or Company Related Party, as applicable, and any other person against the paying party as a result of the termination of the Merger Agreement. In no event will either party be required to pay its respective termination fee on more than one occasion.

Third Party Beneficiaries

The Merger Agreement is not intended to confer upon any person other than the parties any rights, benefits or remedies, except for (i) from and after the Effective Time, the right of the holders of Company Shares to receive the Merger Consideration, and the rights of the holders of Company Equity Awards to receive the consideration therefor, in accordance with the Merger Agreement, (ii) the provisions relating to indemnification, advancement of expenses, exculpation and insurance, which are for the benefit of the Indemnified Parties, and (iii) certain specified provisions that are for the benefit of the Debt Financing Sources.

 

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Specific Performance

The Company, Parent and Merger Sub have agreed that if the Company, Parent or Merger Sub were to breach any of their respective obligations under the Merger Agreement (including failing to take such actions as are required of them thereunder to consummate the Merger and the other transactions contemplated thereby) in accordance with its specified terms or otherwise breach such provision, irreparable damage would occur, no adequate remedy at law would exist and damages would be difficult to determine, and accordingly, subject to the provisions of the Merger Agreement relating to specific performance and prior to any valid termination of the Merger Agreement in accordance with the terms of the Merger Agreement, (a) the parties will be entitled to an injunction or injunctions to prevent or remedy breaches or threatened breaches of the Merger Agreement and to specific performance of the terms thereof, in each case in the Delaware Court of Chancery or, if such court shall not have jurisdiction, in any federal court located in the State of Delaware or any Delaware state court, this being in addition to any other remedy to which they are entitled at law or in equity, (b) the parties waive any requirement for the securing or posting of any bond or other security in connection with the obtaining of any specific performance or injunctive relief, and (c) the parties will waive, in any action for specific performance, the defense of adequacy of a remedy at law, and will not, in any such action, assert that any award of specific performance or other equitable remedy is not an appropriate remedy for any reason at law or in equity. Subject to the terms of the Merger Agreement, either party’s pursuit of specific performance at any time will not be deemed an election of remedies or waiver of the right to pursue any other right or remedy to which such party may be entitled, including the right to pursue remedies for liabilities or damages incurred or suffered by a party in the case of a breach of the Merger Agreement involving willful breach or fraud. Each party further agrees that it will not take any position in any legal proceeding concerning the Merger Agreement that is contrary to the terms of the provisions of the Merger Agreement relating to specific performance. Subject to the terms of the Merger Agreement relating to specific performance, Parent will cause Merger Sub to perform their respective obligations under the Merger Agreement.

Notwithstanding anything in the Merger Agreement or any Ancillary Document or otherwise to the contrary, and subject in all respects to the provisions of the Merger Agreement relating to specific performance, the Company or any Company Related Party (or any of the foregoing’s respective representatives) will be entitled to enforce or seek to enforce specifically Parent’s or Merger Sub’s obligation to cause all or any portion of the Equity Financing to be funded (whether under the Merger Agreement or the Equity Commitment Letter) or otherwise cause Parent or Merger Sub to take action to consummate the Merger (including the obligation to pay all or any portion of the Merger Consideration) if and only if: (i) with respect to the Merger, the payment of the Merger Consideration and the Equity Financing related thereto, all of the conditions of each party’s obligations to effect the Merger have been and continue to be satisfied or waived (other than those conditions that by their terms are to be satisfied at the Closing, but subject to the fulfillment or waiver of those conditions at the Closing), (ii) the Required Debt Amount has been received by Borrower in full in accordance with the terms thereof, or the Debt Financing Sources have confirmed in writing to the parties hereto that the Required Debt Amount will be funded in full at the Closing if the Equity Financing is funded and the Sale/Leaseback Transaction is consummated at the Closing (provided that (A) if Alternative Financing is being used in accordance with the Merger Agreement, all references to Debt Financing in the provisions of the Merger Agreement relating to specific performance will be deemed to refer to the Alternative Financing and (B) Parent and Merger Sub will not be required to draw down the Equity Financing or consummate the Closing if such Required Debt Amount and the Sale/Leaseback Transaction is not in fact funded or consummated, as the case may be, in full at the Closing), (iii) the Sale/Leaseback Transaction has been consummated and the proceeds of such transaction have been received by Merger Sub in full in accordance with the terms thereof, or the Sale/Leaseback Purchaser has confirmed in writing to the parties to the Merger Agreement that the Sale/Leaseback Transaction will be consummated at the Closing if the Equity Financing and the Required Debt Amount are funded at the Closing (provided that Parent and Merger Sub will not be required to draw down the Equity Financing or consummate the Closing if such Required Debt Amount and the Sale/Leaseback Transaction is not in fact funded in full or consummated, as the case may be, at the Closing), (iv) Parent and Merger Sub have failed to complete the Closing by the date the Closing is required to have occurred pursuant to the Merger Agreement, (v) the Company

 

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has irrevocably and unconditionally confirmed in writing to Parent that (A) if specific performance is granted and the Equity Financing, Debt Financing and Sale/Leaseback Transaction are funded or consummated, as the case may be, then the Closing will occur (and the Company has not revoked, withdrawn, modified or conditioned such confirmation) and (B) the Company is prepared, willing and able to effect the consummation of the Closing and the other transactions contemplated by the Merger Agreement, and (vi) Parent and Merger Sub fail to complete the Closing within two business days after delivery of the Company’s irrevocable and unconditional written confirmation. Notwithstanding anything to the contrary in the Merger Agreement or in any Ancillary Document or otherwise, for the avoidance of doubt, while the Company may, subject in all respects to the Merger Agreement (including, in each case, the limitations set forth therein), concurrently seek (x) specific performance or other equitable relief, subject in all respects to this the provisions of the Merger Agreement relating to specific performance, and (y) payment of the Parent Termination Fee, if, as and when required pursuant to the Merger Agreement, under no circumstances will the Company, directly or indirectly, be permitted or entitled to receive (1) both a grant of specific performance or other equitable relief to cause the Equity Financing to be funded (whether under the Merger Agreement or the Equity Commitment Letter) and the Closing to occur, on the one hand, and the payment of all or any portion of the Parent Termination Fee and/or any of the amounts, if any, as and when due, pursuant to the Merger Agreement, on the other hand or (2) payment of monetary damages (other than, for the avoidance of doubt, the Parent Termination Fee as and when due, pursuant to the Merger Agreement).

Governing Law; Consent to Jurisdiction

The Merger Agreement and all claims and causes of action arising in connection therewith will be governed by, and construed in accordance with, the laws of the State of Delaware, without regard to laws that may be applicable under conflicts of laws principles (whether the State of Delaware or any other jurisdiction) that would cause the application of the laws of any jurisdiction other than the State of Delaware. Any action arising out of the Merger Agreement will be heard exclusively in the Court of Chancery of the State of Delaware (or, if it lacks jurisdiction, another state or federal court within Delaware). Notwithstanding the foregoing, any action against any of the Debt Financing Sources Related Parties in connection with the Merger Agreement, including any dispute arising out of relating in any way to the Debt Financing, the Debt Commitment Letter or any other agreement entered into in connection with the Debt Financing or the performance thereof or any of the transactions contemplated hereby or thereby, will be governed by the laws of the State of New York and heard exclusively in the state or federal courts in the Borough of Manhattan in the City of New York, New York.

Amendments; Waivers

The Merger Agreement may be amended by mutual written agreement of the parties at any time before the Effective Time. Certain provisions affecting the rights of the Debt Financing Sources may not be amended without their consent. At any time prior to the Effective Time, Parent and Merger Sub, on the one hand, and the Company, on the other hand, may (a) extend the time for the performance of any of the obligations or other acts of the other, (b) waive any breach of the representations and warranties of the other contained in the Merger Agreement or in any document delivered pursuant hereto, or (c) waive compliance by the other with any of the agreements or covenants contained therein. Any such extension or waiver shall be valid only if set forth in an instrument in writing signed by the party or parties to be bound thereby, but such extension or waiver or failure to insist on strict compliance with an obligation, covenant, agreement or condition will not operate as a waiver of, or estoppel with respect to, any subsequent or other failure. Any delay in exercising any right under the Merger Agreement will not constitute a waiver of such right.

Waiver of Jury Trial

Each party has agreed that any controversy that may arise under the Merger Agreement is likely to involve complicated and difficult issues, and therefore each party has irrevocably and unconditionally waived any right it may have to a trial by jury in respect of any litigation directly or indirectly arising out of or relating to the Merger

 

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Agreement and any of the agreements delivered in connection therewith or the transactions contemplated thereby. Each party has certified and acknowledged that (i) no representative, agent or attorney of any other party has represented, expressly or otherwise, that such other party would not, in the event of litigation, seek to enforce either of such waivers, (ii) it understands and has considered the implications of such waivers, (iii) it makes such waivers voluntarily and (iv) it has been induced to enter into the Merger Agreement by, among other things, the mutual waivers and certifications in this provision of the Merger Agreement.

 

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PROPOSAL 1: ADOPTION OF THE MERGER AGREEMENT

The Merger Proposal

We are asking you to approve a proposal to adopt the Merger Agreement and thereby approve the transactions contemplated by the Merger Agreement, including the Merger. Approval of the Merger Proposal by the Company stockholders is required for completion of the Merger. For a detailed discussion of the terms and conditions of the Merger Agreement, see “The Merger Agreement” on page 73 of this proxy statement. A copy of the Merger Agreement is attached as Annex A to this proxy statement.

Vote Required and Board Recommendation

As discussed in “The Merger—Recommendations of the Denny’s Corporation Board and Reasons for the Merger” on page 40 of this proxy statement, after considering various factors described in such section, the Board has determined that the Merger Agreement and the transactions contemplated thereby, including the Merger, are advisable, fair to, and in the best interests of the Company and its stockholders. The Board has unanimously: (i) determined that the Merger Agreement and the transactions contemplated thereby, including the Merger, are advisable, fair to, and in the best interests of the Company and its stockholders and declared it advisable for the Company to enter into the Merger Agreement; (ii) approved and declared advisable the execution and delivery by the Company of the Merger Agreement, the performance by the Company of its covenants and agreements contained therein, and the consummation of the Merger and the other transactions contemplated thereby upon the terms and subject to the conditions contained therein; (iii) resolved that the Merger be effected under Section 251 of the DGCL; (iv) directed that the Merger Agreement be submitted to the stockholders of the Company for adoption at the Special Meeting; and (v) recommended that the Company’s stockholders adopt the Merger Agreement.

If you sign and return a proxy and do not indicate how you wish to vote on the Merger Proposal, your shares of Common Stock will be voted “FOR” the Merger Proposal.

Under Delaware law, adoption of the Merger Agreement requires the affirmative vote of the holders of a majority of the shares of Common Stock outstanding as of the Record Date and entitled to vote on the matter. Abstentions and broker non-votes, if any, will have the same effect as a vote “AGAINST” the Merger Proposal.

THE BOARD UNANIMOUSLY RECOMMENDS THAT YOU VOTE “FOR” THE MERGER PROPOSAL.

 

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PROPOSAL 2: ADVISORY VOTE ON MERGER-RELATED NAMED EXECUTIVE OFFICER COMPENSATION

The Compensation Advisory Proposal

In accordance with Section 14A of the Exchange Act and the applicable SEC rules issued thereunder, the Company is providing its stockholders with the opportunity to cast a non-binding, advisory vote to approve certain compensation that will or may become payable to the named executive officers of the Company in connection with the Merger, the value of which is set forth in “The Merger—Interests of Denny’s Corporation Directors and Executive Officers in the Merger-Quantification of Payments and Benefits” on page 57 of this proxy statement.

The Board encourages you to carefully review the named executive officers’ Merger-related compensation information disclosed in this proxy statement. As required by Section 14A of the Exchange Act, the Company is asking its stockholders to vote on the adoption of the following resolution:

“RESOLVED, that the stockholders approve, on a non-binding, advisory basis, the compensation that will or may become payable to Denny’s Corporation named executive officers that is based on or otherwise relates to the Merger, including the agreements and understandings pursuant to which such compensation will or may become payable, as disclosed pursuant to Item 402(t) of Regulation S-K under the section entitled “The Merger—Interests of Denny’s Corporation Directors and Executive Officers in the Merger-Quantification of Payments and Benefits” beginning on page 57 of the proxy statement for the Special Meeting, including the tables, associated footnotes and narrative discussion.”

The vote on the Compensation Advisory Proposal is a vote separate and apart from the vote on the Merger Proposal. Accordingly, you may vote to approve the Merger Proposal and vote not to approve the Compensation Advisory Proposal, and vice versa. Stockholders should note that this proposal is not a condition to completion of the Merger, and as a non-binding, advisory vote, the result will not be binding on the Company, the Board or Parent. Further, the underlying plans and arrangements are contractual in nature and not, by their terms, subject to stockholder approval. Accordingly, regardless of the outcome of the advisory vote, if the Merger is consummated, our named executive officers will be eligible to receive the compensation that is based on or otherwise relates to the Merger in accordance with the terms and conditions applicable to those payments.

Vote Required and Board Recommendation

Approval of the Compensation Advisory Proposal requires the affirmative vote of a majority of the votes cast at the Special Meeting. Assuming a quorum is present, abstentions and broker non-votes will have no effect on this proposal. If you sign and return a proxy and do not indicate how you wish to vote on the Compensation Advisory Proposal, your shares of Common Stock will be voted “FOR” the Compensation Advisory Proposal.

THE BOARD UNANIMOUSLY RECOMMENDS THAT YOU VOTE “FOR” THE COMPENSATION ADVISORY PROPOSAL.

 

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PROPOSAL 3: ADJOURNMENT OF THE SPECIAL MEETING

The Adjournment Proposal

We are asking you to approve a proposal to approve one or more adjournments of the Special Meeting to a later date or time, if necessary or appropriate, to solicit additional proxies if there are insufficient votes to adopt the Merger Agreement at the time of the Special Meeting. If our stockholders approve the Adjournment Proposal, we could adjourn the Special Meeting and any adjourned session of the Special Meeting to solicit additional proxies, including the solicitation of proxies from stockholders that have previously returned properly executed proxies voting against adoption of the Merger Agreement. Among other things, approval of the Adjournment Proposal could mean that, even if a quorum is present and we had received proxies representing a sufficient number of votes against adoption of the Merger Agreement such that the Merger Proposal would be defeated, we could adjourn the Special Meeting without a vote on the adoption of the Merger Agreement and seek to convince the holders of those shares to change their votes to votes in favor of adoption of the Merger Agreement.

If the Special Meeting is adjourned, stockholders who have already submitted their proxies will be able to revoke them at any time prior to the vote on the proposals. If the adjournment is for more than 30 days, or if after the adjournment a new record date is fixed for the adjourned meeting, a notice of the adjourned meeting will be given to each stockholder of record entitled to vote at the meeting.

Vote Required and Board Recommendation

Approval of the Adjournment Proposal requires the affirmative vote of a majority of the votes cast at the Special Meeting. Assuming a quorum is present, abstentions and broker non-votes will have no effect on this proposal. If you sign and return a proxy and do not indicate how you wish to vote on the Adjournment Proposal, your shares of Common Stock will be voted “FOR” the Adjournment Proposal.

The Board believes that it is in the best interests of the Company and its stockholders to be able to adjourn the Special Meeting to a later date or time, if necessary or appropriate, for the purpose of soliciting additional votes in respect of the Merger Proposal if there are insufficient votes to adopt the Merger Agreement at the time of the Special Meeting.

In addition, if a quorum is not present, the chair of the Special Meeting may adjourn the meeting.

THE BOARD UNANIMOUSLY RECOMMENDS THAT YOU VOTE “FOR” THE ADJOURNMENT PROPOSAL.

 

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MARKET PRICES AND DIVIDEND DATA

Common Stock is listed on Nasdaq under the symbol “DENN.”

On November 3, 2025, the last trading day prior to the public announcement of the execution of the Merger Agreement, the closing price of Common Stock on Nasdaq was $4.11 per share. On [●], 2026, the latest practicable trading day before the printing of this proxy statement, the closing price of Common Stock on Nasdaq was $[●] per share. You are encouraged to obtain current market quotations for Common Stock in connection with voting your shares.

Dividends

Under the terms of the Merger Agreement, from the date of the Merger Agreement until the Effective Time, the Company may not declare or pay dividends on Common Stock without Parent’s written consent. Following the Effective Time, there will be no further market for Common Stock, which will be delisted from Nasdaq and deregistered under the Exchange Act.

 

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SECURITY OWNERSHIP OF CERTAIN

BENEFICIAL OWNERS AND MANAGEMENT

The following table sets forth, as of November 12, 2025, the beneficial ownership of Common Stock of (i) each current member of the Board; (ii) each named executive officer of the Company, and (iii) all current directors and executive officers of the Company as a group.

Unless otherwise indicated, the persons below have sole voting and investment power with respect to the shares of Common Stock shown as beneficially owned by them.

Beneficial ownership is determined according to the rules of the SEC, which generally provide that a person has beneficial ownership of a security if he, she or it possesses sole or shared voting or investment power over that security, including securities that he, she or it has the right to acquire within 60 days.

Applicable percentage ownership and voting power is based on 51,498,994 shares of Common Stock outstanding as of November 12, 2025.

 

Name		Number of Shares of the Company Common Stock Beneficially Owned(1)				Percentage of Class
Bernadette S. Aulestia			100,400				*
Olu Beck			78,349				*
Gregg R. Dedrick			182,540				*
José M. Gutiérrez			169,583				*
John C. Miller			800,253				1.6	%
Kelli F. Valade			579,095				1.1	%
Mark R. Vondrasek			38,697				*
Christopher D. Bode			191,334				*
Gail E. Sharps Myers			171,133				*
David P. Schmidt			155,103				*
Robert P. Verostek			238,644	(2)			*
All directors and executive officers as a group (15 individuals)			3,244,051				6.5	%

 

*	Represents less than 1% of the outstanding Common Stock.

(1)

The Common Stock listed as beneficially owned by the following individuals includes shares of Common Stock which such individuals have the vested right to acquire (as of November 12, 2025 or within 60 days thereafter) through the conversion of deferred stock units (on a designated date or upon termination of service as a director of Denny’s Corporation), restricted stock units or performance share units deferred pursuant to the Company’s Deferred Compensation Plan (on a designated date or upon termination as an employee of Denny’s): (i) Ms. Aulestia (100,400 shares), (ii) Ms. Beck (67,204 shares), (iii) Mr. Dedrick (77,549 shares), (iv) Mr. Gutiérrez (93,739 shares), (v) Mr. Miller (33,619 shares), (vi) Ms. Valade (386,289 shares), (vii) Mr. Verostek (143,496 shares), (viii) Mr. Vondrasek (38,697 shares), and (ix) all current directors and executive officers as a group (1,631,923 shares).

(2)	Mr. Verostek has shared voting and investment power with respect to 24,000 of the shares shown as beneficially owned by him.

 

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