UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549​

Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934 (Amendment No.         )

Grocery Outlet Holding Corp.

(Name of Registrant as Specified in its Charter)

(Name of Person(s) Filing Proxy Statement, if Other Than the Registrant)

We are proud to have grown our store base and market share in 2023, as we achieved record sales and adjusted EBITDA. We delivered these results while continuing to fulfill our mission of Touching Lives for the Better. We have positively impacted the lives of millions of people throughout our 78-year history and this impact increases as the business grows.

Our underlying business fundamentals remain healthy. Each of our stores continues to offer customers a wide assortment of goods at unbeatable values in a fun, treasure hunt shopping experience. Our ever-changing assortment of “WOW!” deals of quality, name-brand products differentiates us with customers across a broad range of income levels, demographics and geographies. And our entrepreneurial Independent Operators (IOs) create a neighborhood feel through personalized customer service and a local product offering. The resulting unique value proposition generates strong customer loyalty and brand affinity.

We are executing our long-term growth strategy built on three primary pillars: strengthening our core business model, evolving our business and expanding our reach. We believe that our compelling WOW! Shopping experience will continue to drive new and existing customers to shop in our stores. And we are well positioned to continue to expand our footprint and increase our market share.

We would like to highlight several areas of importance for Grocery Outlet in 2023 and continuing into 2024.

Financial Performance and Operations

We delivered strong top-line growth in 2023, with comparable store sales increasing 7.5% and customer count increasing 8.3%. Same store sales growth together with new store contributions resulted in a record $4 billion in total net sales. We also drove healthy bottom-line growth with adjusted EBITDA increasing by 17.7% and adjusted net income increasing by 15.2%. We generated $303.4 million of operating cash flow, and we invested $175.6 million in capex, net of tenant improvement allowances. Further, we ended 2023 with healthy product inventory to carry us into 2024 and net leverage of less than 1x adjusted EBITDA.

During the third quarter of 2023 the implementation of new system upgrades resulted in ordering and inventory disruptions, which impacted our results of operations during the remainder of the year. Although data integration efforts have taken longer than expected, we have made steady progress and we look forward to realizing the benefits of our new systems in 2024 and beyond. This new platform will support the growth of our business and store base in the years to come.

Other key strategic initiatives that will strengthen our value proposition and contribute to future growth include our personalization app and our new private label program. Our personalization app recently rolled out to all Grocery Outlet stores and we will soon begin to invest in marketing to drive downloads and adoption. Our private label program will launch later this year and will initially focus on everyday-value commodity categories that deliver better value and margin and complete the full shop.

New Store Growth

New store growth remains an important driver of long-term shareholder value, and our broad customer appeal supports significant new store growth opportunities in existing and new markets. We operate in 16 states today and we plan to continue expanding our reach to additional customers and geographies across the United States.

We recently announced the closing of our acquisition of United Grocery Outlet (UGO), which added 40 stores and a multi-temperature distribution center to our network. We believe UGO is an ideal strategic fit with our business, given our similar business models, customer value propositions, and shared mission of serving and helping others. This acquisition provides Grocery Outlet with scale in a new geography, as well as a platform for future expansion in the Southeast. We are thrilled to welcome the United Grocery Outlet team into the Grocery Outlet family, and we look forward to working together on the many growth opportunities ahead.

Our long-term goal is to expand our store base by approximately 10% annually, through organic growth and additional real estate opportunities that align with our long-term store growth strategies. In fiscal 2023, we opened 27 net new stores. In the current year, on top of the addition of the United Grocery Outlet stores, we plan to open 15 to 20 stores for a total of 55 to 60

net new stores. As we look toward 2025, our real estate pipeline is healthy and we are well positioned to deliver on our 10% annual growth goal in the years ahead.

Our Communities, Our People and Our Planet

We published our inaugural ESG report in 2023, which describes how our long-term success is naturally aligned with our ability to positively impact our Communities, our People and our Planet. In our Communities, we save customers money, increase food access, and partner with our Independent Operators (IOs) to give back and enrich the communities we serve. We serve our People by providing entrepreneurial opportunities and support to IOs, and by empowering our employees with growth and development opportunities. For our Planet, we reduce food waste and energy use through our opportunistic sourcing model, supplier partnerships and collaboration with IOs.

We are committed to continuously enhancing our transparency, improving our sustainability practices, and effectively meeting the expectations of our stakeholders. Our ESG report included initial data on certain activity metrics within the Sustainability Accounting Standards Board framework for the Food Retail & Distributors industry. We also conducted and reported on our first Greenhouse Gas emissions inventory, which included Scope 1, Scope 2, and select Scope 3 emission categories, to better understand our overall impact.

In closing, as we celebrate five years as a public company, we would like to thank all Grocery Outlet team members, our IOs, our suppliers, investors and other stakeholders for their dedication and many contributions. We take great pride in the leadership role we play in building and growing this unique business and consider it a privilege to serve as the stewards of your capital. We are well positioned to continue to grow our business and strengthen our mission of Touching Lives for the Better and are confident in the future.

On behalf of Grocery Outlet’s Board and management team, we look forward to welcoming you at our 2024 Annual Meeting.

Sincerely,

Notice of Annual Meeting of Stockholders

To be held on Monday, June 3, 2024
11:00 a.m. Pacific Daylight Time

www.virtualshareholdermeeting.com/GO2024

To the Stockholders of Grocery Outlet Holding Corp.:

Notice is hereby given that the 2024 Annual Meeting of Stockholders (the “2024 Annual Meeting”) of Grocery Outlet Holding Corp. (the “Company”) will be on Monday, June 3, 2024, at 11:00 a.m. Pacific Daylight Time online through a live webcast at www.virtualshareholdermeeting.com/GO2024. At the 2024 Annual Meeting, stockholders will be asked:

1.

Election of Class II Directors. To elect the three Class II directors named in the accompanying proxy statement to hold office effectively until the 2026 annual meeting of stockholders and until their respective successors have been duly elected and qualified, or until such director’s earlier resignation, retirement or other termination of service.

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2.

Ratify the appointment of Deloitte & Touche LLP for Fiscal Year 2024. To ratify the appointment of Deloitte & Touche LLP as the Company’s independent registered public accounting firm for the fiscal year ending December 28, 2024.

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3.

Say-on-Pay. To approve an advisory (non-binding) vote on the Company’s named executive officer compensation.

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4.

To transact such other business as may properly come before the 2024 Annual Meeting and any adjournment or postponement thereof.

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The accompanying proxy statement describes each of these items of business in detail.

Only stockholders of record as of April 9, 2024 will be entitled to attend and vote at the 2024 Annual Meeting and any adjournment or postponement thereof. There will not be a physical location for the 2024 Annual Meeting and you will not be able to attend the meeting in person. We have designed the virtual format of the 2024 Annual Meeting to provide stockholders substantially the same rights and opportunities to participate as they would have at an in-person meeting.

Your vote is important. To be sure your vote counts and assure a quorum, please promptly vote over the Internet or by telephone or by mail as described in the accompanying proxy statement, whether or not you plan to participate in the 2024 Annual Meeting via live webcast. If your shares of our common stock are held in the name of your broker, bank or other nominee, you will need to follow the instructions provided to you by the institution that holds such shares to instruct them how to vote your shares.

By order of the Board of Directors,

Luke D. Thompson
EVP, General Counsel and Secretary

Emeryville, California

April 19, 2024

IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS FOR THE 2024 ANNUAL MEETING OF STOCKHOLDERS TO BE HELD ON JUNE 3, 2024:

TABLE OF CONTENTS
 

​	PROXY SUMMARY	​	​	​	​	1	​	​
​	About Grocery Outlet Holding Corp.	​	​	​	​	1	​	​
​	2024 Annual Meeting of Stockholders	​	​	​	​	1	​	​
​	Proposals and Voting Recommendations	​	​	​	​	1	​	​
​	Voting Methods	​	​	​	​	2	​	​
​	Fiscal Year 2023 Highlights	​	​	​	​	2	​	​
​	Compensation of our Named Executive Officers	​	​	​	​	5	​	​
​	PROXY STATEMENT	​	​	​	​	7	​	​
​	CORPORATE GOVERNANCE AND BOARD MATTERS	​	​	​	​	7	​	​
​	Board of Directors	​	​	​	​	7	​	​
​	Directors as of the Record Date	​	​	​	​	7	​	​
​	Specific Skills, Experience and Qualifications of Directors	​	​	​	​	8	​	​
​	Board Diversity Matrix	​	​	​	​	11	​	​
​	Director Recruitment, Nominations and Appointments	​	​	​	​	11	​	​
​	Nomination Rights and Support Obligations under our Amended and Restated Stockholders Agreement	​	​	​	​	12	​	​
​	Director Independence	​	​	​	​	12	​	​
​	Director Backgrounds and Qualifications	​	​	​	​	12	​	​
​	Board Leadership Structure	​	​	​	​	28	​	​
​	Corporate Goverannce Guidelines	​	​	​	​	29	​	​
​	Board and Committee Meetings and Annual Meeting Attendance	​	​	​	​	29	​	​
​	Board and Committees’ Role in Risk Oversight	​	​	​	​	30	​	​
​	Annual Board and Committee Self-Evaluations	​	​	​	​	31	​	​
​	Committees of the Board	​	​	​	​	31	​	​
​	Stockholder Engagement	​	​	​	​	34	​	​
​	Communications with the Board of Directors	​	​	​	​	34	​	​
​	Our Environmental, Social and Governance Approach	​	​	​	​	34	​	​
​	Our Commitment to Human Capital Management	​	​	​	​	35	​	​
​	Code of Business Conduct and Ethics	​	​	​	​	38	​	​
​	Director Compensation	​	​	​	​	38	​	​
​	AUDIT AND RISK COMMITTEE REPORT	​	​	​	​	42	​	​
​	OTHER AUDIT AND RISK COMMITTEE MATTERS	​	​	​	​	44	​	​
​	EXECUTIVE OFFICERS	​	​	​	​	45	​	​
​	COMPENSATION DISCUSSION AND ANALYSIS	​	​	​	​	48	​	​
​	Executive Summary	​	​	​	​	48	​	​
​	Elements of Fiscal Year 2023 NEO Compensation Program	​	​	​	​	52	​	​
​	Compensation Levels and Benchmarking	​	​	​	​	57	​	​
​	Process and Roles for Determining Compensation	​	​	​	​	58	​	​
​	The Role of Stockholder Say-on-Pay Votes	​	​	​	​	60	​	​
​	Employment Arrangements with NEOs	​	​	​	​	60	​	​
​	Other Compensation	​	​	​	​	60	​	​
​	Other Equity-Related Policies	​	​	​	​	61	​	​
​	Initial Fiscal Year 2024 NEO Compensation Program Determinations	​	​	​	​	63	​	​
​	Tax and Accounting Implications	​	​	​	​	63	​	​
​	COMPENSATION COMMITTEE REPORT	​	​	​	​	64	​	​

​	NAMED EXECUTIVE OFFICER COMPENSATION TABLES	​	​	​	​	65	​	​
​	Summary Compensation Table in Fiscal Years 2023, 2022 and 2021	​	​	​	​	65	​	​
​	Grants of Plan-Based Awards in Fiscal Year 2023	​	​	​	​	67	​	​
​	Narrative Disclosure to Summary Compensation Table and Grants of Plan-Based Awards	​	​	​	​	68	​	​
​	Outstanding Equity Awards at 2023 Fiscal Year End	​	​	​	​	69	​	​
​	Option Exercises and Stock Vested During Fiscal Year 2023	​	​	​	​	70	​	​
​	Potential Payments Upon Termination or Change in Control	​	​	​	​	71	​	​
​	Pay Versus Performance	​	​	​	​	75	​	​
​	CEO PAY RATIO	​	​	​	​	81	​	​
​	CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS	​	​	​	​	82	​	​
​	SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT	​	​	​	​	84	​	​
​	SECURITIES AUTHORIZED FOR ISSUANCE UNDER EQUITY COMPENSATION PLANS	​	​	​	​	86	​	​
​	PROPOSALS FOR CONSIDERATION AT ANNUAL MEETING	​	​	​	​	87	​	​
​	Proposal 1—Election of Class II Directors	​	​	​	​	87	​	​
​	Proposal 2—Ratification of Independent Registered Public Accounting Firm	​	​	​	​	88	​	​
​	Proposal 3—Advisory (Non-Binding) Vote to Approve the Company’s Named Executive Officer Compensation	​	​	​	​	89	​	​
​	ADDITIONAL INFORMATION	​	​	​	​	90	​	​
​	Frequently Asked Questions About the Proxy Materials and the Annual Meeting	​	​	​	​	90	​	​
​	Delinquent Section 16(a) Reports	​	​	​	​	95	​	​
​	OTHER MATTERS	​	​	​	​	96	​	​
​	Availability of Fiscal Year 2023 Annual Report to Stockholders	​	​	​	​	96	​	​
​	Stockholder Proposals and Director Nominations for the 2025 Annual Meeting of Stockholders	​	​	​	​	96	​	​
​	Delivery of Documents to Stockholders Sharing an Address	​	​	​	​	97	​	​
​	Transfer Agent Information	​	​	​	​	97	​	​
​	Forward-Looking Statements	​	​	​	​	97	​	​
​	Annex A—Non-GAAP Financial Measures	​	​	​	​	A-1	​	​
​	​	​	​	​	​	​	​	​

PROXY SUMMARY

This summary highlights information contained elsewhere in this Proxy Statement (the “Proxy Statement”). Prior to voting, you should read the entire Proxy Statement and our Annual Report on Form 10-K for Fiscal Year 2023 (the “2023 Annual Report”), which includes our consolidated financial statements and information about our operations and performance. These materials are available at www.proxyvote.com. This Proxy Statement and the accompanying proxy card initially are being made available on or about April 19, 2024.

As used in this Proxy Statement, references to “Grocery Outlet,” the “Company,” “we,” “us,” “our” or “our business” refers to Grocery Outlet Holding Corp. (collectively with its wholly owned subsidiaries), except as expressly indicated or the context otherwise requires. The information available on or through our website and any website referenced herein is not incorporated herein or otherwise part of this Proxy Statement.

Our fiscal year ends on the Saturday closest to December 31. References to Fiscal Year 2023, Fiscal Year 2022, Fiscal Year 2021, and Fiscal Year 2020 refer to the fiscal years ended December 30, 2023, December 31, 2022, January 1, 2022 and January 2, 2021, respectively. Reference to Fiscal Year 2024 refers to the fiscal year ending December 28, 2024.

About Grocery Outlet Holding Corp.

Based in Emeryville, California, Grocery Outlet is a high-growth, extreme value retailer of quality, name-brand consumables and fresh products sold through a network of independently operated stores. Grocery Outlet has more than 470 stores in California, Washington, Oregon, Pennsylvania, Idaho, Nevada, Maryland, New Jersey, Ohio and Delaware. Effective April 1, 2024, Grocery Outlet also owns The Bargain Barn, Inc., doing business as United Grocery Outlet, a closeout grocery retailer with 40 stores in Tennessee, North Carolina, Georgia, Alabama, Kentucky, and Virginia.

2024 Annual Meeting of Stockholders

To participate in the 2024 Annual Meeting of Stockholders, including any postponement or adjournment thereof (the “2024 Annual Meeting”), you must have the sixteen-digit number that is shown on your Notice of Internet Availability or on your proxy or voting card (if you elected to receive proxy materials by mail).

Proposals and Voting Recommendations

Proxy Summary

Voting Methods

If you are a stockholder of record, you can vote in one of four ways:

✓

Visit www.proxyvote.com to vote VIA THE INTERNET

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✓

Call 1-800-690-6903 to vote BY TELEPHONE

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✓

If you received a printed copy of the proxy materials, sign, date and return your proxy card in the prepaid enclosed envelope to vote BY MAIL

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✓

Attend virtually to vote DURING THE ANNUAL MEETING

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To reduce our administrative and postage costs and the environmental impact of our 2024 Annual Meeting, we encourage stockholders to vote via the Internet or by telephone, both of which are available 24 hours a day, seven days a week, until 11:59 p.m. Eastern Time on June 2, 2024. Stockholders may revoke their proxies at the time and in the manner described on page 94 of this Proxy Statement.

If your shares of our common stock are held in “street name” through a bank, broker or other holder of record, you will receive voting instructions from the holder of record that you must follow in order for your shares to be voted. If you hold shares in this manner and wish to vote in person at the meeting, you must obtain a legal proxy from the bank, broker or other holder of record that holds your shares of our common stock.

Fiscal Year 2023 Highlights

FINANCIAL AND OPERATING HIGHLIGHTS

In Fiscal Year 2023, we increased our traffic and market share, achieved record sales, and grew adjusted EBITDA. We grew net sales by 10.9%, net income by 22.1%, and adjusted EBITDA by 17.7%. We also made measurable progress on a number of our strategic initiatives that we believe will further strengthen our value proposition and contribute toward long-term growth. Financial highlights from Fiscal Year 2023 include:

​

(1)

See the Table of Contents for information regarding our non-GAAP financial measures.

​

For more complete information regarding our 2023 performance, please review our 2023 Annual Report.

Proxy Summary

CLASS II DIRECTOR NOMINEES AS OF RECORD DATE

Our board of directors (“Board of Directors” or “Board”) has nominated each of the three Class II directors listed below to be elected at the 2024 Annual Meeting for terms effectively ending in 2026. In 2022, we amended our Amended and Restated Certificate of Incorporation to declassify our Board following approval by our stockholders. The charter now provides that directors will be elected for a three-year term, but that the term of all classes of directors will terminate at the 2026 annual meeting of stockholders.

Mary Kay Haben​

•

Ms. Haben has been an outside director for various public companies since her retirement in February 2011. From April 2007 to February 2011, Ms. Haben held various senior positions with Wm. Wrigley Jr. Company, a confectionery company, most recently as President, North America. Prior to that time, she held several key positions during her 27-year career with Kraft Foods, Inc., a grocery manufacturing and processing conglomerate, including serving as President of multibillion dollar divisions.

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•

She possesses substantial M&A, operating, digital, marketing, and brand management and development experience from long-term senior executive roles for consumer-packaged goods/food companies. She also has deep knowledge of and ability to analyze the overall consumer-packaged goods industry, evolving market dynamics and consumers’ relationships with brands. Her executive experience also includes numerous years of direct reports in sales, R&D and supply chain.

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•

She is a long-tenured current board member of two public companies, and was a long-term board member of a third public company until a go-private sale transaction. Her experience includes two significant directorships with consumer-packaged goods/food companies and numerous leadership and board committee roles.

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Gail Moody-Byrd​

•

Ms. Moody-Byrd has served as Vice President, Marketing of LinkedIn Sales Solutions at LinkedIn Corporation since March 2022. Previously, she served as the Chief Marketing Officer of Noodle.ai, a software company, from November 2018 to February 2022. Prior to Noodle.ai, from September 2007 to June 2017, Ms. Moody-Byrd held various positions with SAP SE, a multinational software corporation, most recently as Vice President of Web Marketing. Her retail industry experience also includes roles with divisions of Macy’s and Target Corporation, with Levi, Strauss & Co., and as a retail consultant with McKinsey & Company and Walter K. Levy Associates.

​

•

She has developed significant marketing and brand management expertise through more than 35 years in B2B technology marketing and retail/wholesale industry consulting, merchandising and planning.

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•

Her early career focused on retail industry matters, including serving as a retail consultant for national and global brands, as well as a merchandiser, buyer, and brand manager. At Noodle.ai, she drove brand awareness and revenue generation.

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•

She has had recent involvement in strategic planning and other executive management matters at LinkedIn, and operated as a member of the C-suite at Noodle.ai.

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•

At SAP, she spent five years as the digital marketing lead for the SAP Community Network, an online loyalty community of over 2 million customers undertaking various stages of large-scale digital transformations through SAP software implementations.

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Proxy Summary

Jeffrey York​

•

Mr. York has served as Special Advisor to Sobeys, Inc. the second largest food retailer in Canada, since June 2020. Previously, he served as Partner, Farm Boy, Inc., a grocery retailer, from June 2020 to January 2024 and as Co-Chief Executive Officer and President of Farm Boy from November 2009 through June 2020.

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•

He developed extensive knowledge of the grocery and food retail industries, as well as extreme value discount retail, throughout his career spanning over 30 years in these areas. He led rapid growth in store count and sales during his tenure at both Giant Tiger Stores and Farm Boy.

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•

He possesses substantial executive management expertise, with particular experience in developing corporate strategy, oversight of supply chain and logistics matters for fresh food deliveries, distribution centers and business operations.

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•

He has financial and accounting expertise through being a Canadian certified public accountant and serving on the audit committees of other boards. He also has various additional experience as a director of Canadian public companies.

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Voting, Election and Conditional Resignations. Our Amended and Restated Bylaws provides that in an uncontested director election, a director nominee will be elected to the Board by the stockholders only if the votes cast “FOR” such nominee’s election exceed the votes cast “AGAINST” such nominee’s election. Although counted for quorum purposes, abstentions and broker non-votes, if any, will not be included in the total number of votes cast or be counted as votes for or against any nominee’s election.

If a director nominee who currently serves as a director is not re-elected, Delaware law provides that the director would continue to serve on the Board as a “holdover director.” Under our Corporate Governance Guidelines, we maintain a director resignation policy that provides for the contingent resignation of a director who receives more “against” votes than “for” votes in an uncontested director election, as well as the process of the Nominating and Corporate Governance Committee and the Board to review such resignation offer and publicly disclose the Board’s decision on whether to accept such offer.

BOARD OF DIRECTORS—GOVERNANCE PRINCIPLES

The Board recognizes the importance of taking a reasonable, measured approach in evolving our corporate governance practices as a public company. Set forth below are certain of our key governance principles:

Proxy Summary

In the fourth quarter of 2023, the Nominating and Corporate Governance Committee oversaw a detailed evaluation of the experience, qualifications and skills of our directors. See “Corporate Governance and Board Matters—Board of Directors—​Specific Skills, Experience and Qualifications of Directors” and “—Director Backgrounds and Qualifications” for enhanced biographical information and the revised criteria of the skills, experience and expertise evaluated for each director nominee and continuing director.

Compensation of our Named Executive Officers

KEY ELEMENTS OF FISCAL YEAR 2023 COMPENSATION

Substantially consistent with prior fiscal years, the key elements of our pay mix for named executive officers (“Named Executive Officers” or “NEOs”) in Fiscal Year 2023 consisted of:

•

Base salary

​

•

Our annual incentive plan (the “AIP”), an annual performance-based cash bonus that is subject to our achievement of adjusted EBITDA (70% weighted) and comparable store sales performance (30% weighted) goals

​

•

Long-term equity incentives, consisting of time-vesting restricted stock units (“RSUs”) and performance-vesting stock units (“PSUs”)

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◦

The Compensation Committee set the mix of long-term target equity incentive value as 70% PSUs and 30% RSUs for our President and Chief Executive Officer and 60% PSUs and 40% RSUs for the other Named Executive Officers, thereby making a substantial portion of their compensation performance-based

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◦

PSUs are subject to our achievement of revenue and adjusted EBITDA growth goals, equally weighted, over a three-year performance period

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In Fiscal Year 2023, in line with our compensation philosophy that a significant portion of our executive pay be tied to company performance, approximately 85% of our Chief Executive Officer’s and 73% of our other NEO’s target total compensation was variable (or “at risk”), with value ultimately tied to either the achievement of objective corporate goals or stock price performance, or both.

The Compensation Committee believes this pay mix appropriately aligns the interests of executives with those of our stockholders. The charts below illustrate the target mix of pay (excluding benefits and perquisites) for our CEO and other NEOs for Fiscal Year 2023.

Proxy Summary

FISCAL YEAR 2023 NEO COMPENSATION DETERMINATIONS

ENVIRONMENTAL, SOCIAL AND GOVERNANCE

We have developed a holistic ESG strategy that aligns with our unique model. In Fiscal Year 2022, we began the process of documenting the positive ESG benefits inherent in our business, and in Fiscal Year 2023 we published our inaugural ESG report which focused on the positive impact we have on our communities, people and planet. Our ESG Steering Committee (whose membership includes senior management) meets quarterly to discuss our ESG initiatives, goals and progress. At the Board level, our Nominating and Corporate Governance Committee is responsible for overseeing (and regularly receives reports reflecting) matters of corporate responsibility, sustainability and other environmental, social and governance issues, as well as our public reporting regarding these topics. Our Board also receives regular reports on our progress from the Nominating and Corporate Governance Committee and, at least once per year, from management. See “Corporate Governance and Board Matters—Our Environmental, Social and Governance Approach” for more information.

PROXY STATEMENT

2024 Annual Meeting of Stockholders to be held on June 3, 2024

This Proxy Statement is being furnished together with our 2023 Annual Report in connection with the solicitation of proxies by our Board for the 2024 Annual Meeting. On or about April 19, 2024, we will mail to each of our stockholders (other than those who previously requested electronic delivery or previously elected to receive delivery of a paper copy of the proxy materials) a Notice of Internet Availability of Proxy Materials containing instructions on how to access and review the proxy materials via the Internet and how to submit a proxy electronically using the Internet.

CORPORATE GOVERNANCE AND BOARD MATTERS

Board of Directors

DIRECTORS AS OF RECORD DATE

Corporate Governance and Board Matters​

SPECIFIC SKILLS, EXPERIENCE AND QUALIFICATIONS OF DIRECTORS

Our Nominating and Corporate Governance Committee is responsible for reviewing the qualifications of continuing directors and potential director candidates and recommending to the Board those persons to be nominated for election or appointed to the Board, subject to any obligations and procedures governing the nomination of directors to the Board that may be set forth in any stockholders agreement of which the Company is a party. The Nominating and Corporate Governance Committee also monitors the mix of specific experience, qualifications and skills of directors to assure that the Board, as a whole, has the necessary tools to perform its oversight function effectively in light of the Company’s business and structure.

This process has led to periodic Board refreshment since our IPO in June 2019, which included an increased focus on director independence and diversity. In early 2023, we enhanced Board leadership diversity with Ms. Haben becoming Chair of our Nominating and Corporate Governance Committee. Our periodic Board refreshment has greatly increased the breadth of skills and industry experience on the Board.

In the fourth quarter of 2023, the Nominating and Corporate Governance Committee and oversaw a detailed evaluation of the experience, qualifications and skills of our directors, including peer and market research and the completion of a targeted supplemental questionnaire by each director. Such process led us to refine the relevant experience, qualifications and skills linked to the Company’s current operations and strategy. Following such review, the Nominating and Corporate Governance Committee determined that it was important to communicate these matters to stakeholders, both for directors individually and the Board in aggregate by significantly enhancing the biographies disclosed for director nominees and continuing directors. See below “—Director Backgrounds and Qualifications” for detailed biographical information for each director nominee and continuing director.

Set forth below are revised criteria of key skills, experience and expertise evaluated by our Nominating and Corporate Governance Committee and Board, along with the number of directors who possess each skill. In determining the number of directors who possessed each skill we focused on primary skillsets each director contributes rather than general qualifications or experience in a certain area. Accordingly, a director not included in the number for a particular category does not necessarily mean that the individual does not possess such skill, qualification, or experience. For each qualification and skill, we focused on key minimum criteria:

•

For at least a specified period of time, such skill or qualification must have been acquired through senior management experience (C-suite or equivalent and direct reports) or, in certain cases, board member experience (other than experience on our Board)

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•

The applicable companies where such skill or qualification was acquired must be of a reasonable size, maturity and/or possess similar factors that would be reasonably relevant to Grocery Outlet

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Corporate Governance and Board Matters​

Corporate Governance and Board Matters​

Corporate Governance and Board Matters​

BOARD DIVERSITY MATRIX (AS OF APRIL 19, 2024)

DIRECTOR RECRUITMENT, NOMINATIONS AND APPOINTMENTS

The Nominating and Corporate Governance Committee is responsible for facilitating director assessments, identifying skills and expertise that director candidates should possess, and screening, selecting and recommending persons for director nomination or appointment by the Board, including the re-nomination of continuing directors. As part of director succession planning and Board refreshment, the Nominating and Corporate Governance Committee may solicit recommendations for candidates from other members of the Board and management and may also retain professional search firms to identify candidates. Further, the Committee will evaluate the qualifications of candidates recommended by stockholders against the same criteria it uses to evaluate other candidates. We did not receive any recommendations for director nominations from stockholders for the 2024 Annual Meeting.

The Committee will take into account all factors it considers appropriate in recommending continuing directors for re-election, or new director candidates for election or appointment, to the Board, which will include:

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ensuring that the Board, as a whole, is appropriately diverse and consists of individuals with various and relevant career experience (including current employment), prior and current service on public company boards, relevant technical skills, industry knowledge and experience, financial expertise (including expertise that could qualify a director as an “audit committee financial expert”), and local or community ties and service;

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minimum individual qualifications, including integrity, strength of character, mature and good business judgment, familiarity with the Company’s business and industry, independence of thought and ability to work collegially;

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for continuing directors, the individual performance of such person on the Board; and

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the extent to which the candidate would address a targeted skill, qualification or expertise for the Board.

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NOMINATION RIGHTS AND SUPPORT OBLIGATIONS UNDER OUR AMENDED AND RESTATED STOCKHOLDERS AGREEMENT

Our Amended and Restated Stockholders Agreement provides, among other terms, that the Executive Stockholders (as defined in the Amended and Restated Stockholders Agreement) and the Read Trust Rollover Stockholders (as defined in the Amended and Restated Stockholders Agreement), trusts controlled by Mr. Lindberg or members of their respective immediate family, acting together by majority vote, will have the right to nominate one person (such person, the “Stockholder Nominee”) to our Board for so long as such stockholders collectively own at least 5% of the outstanding shares of our common stock. The Amended and Restated Stockholders Agreement also provides that our Chief Executive Officer will be nominated to our Board.

Pursuant to the Amended and Restated Stockholders Agreement, we must include the Stockholder Nominee and the Chief Executive Officer nominee on the slate that is included in the proxy statement relating to the election of directors of the class to which such persons belong and provide the highest level of support for the election of each such persons as we provide to any other director nominee. In addition, each stockholder party to the Amended and Restated Stockholders Agreement agrees to vote in favor of the Company slate that is included in our proxy statement.

The Stockholder Nominee position is currently vacant, and the Chief Executive Officer, Mr. Sheedy, is a Class III director.

DIRECTOR INDEPENDENCE

Pursuant to the corporate governance listing standards of The Nasdaq Stock Market LLC (“Nasdaq”), a director employed by us cannot be deemed to be an independent director. Each other director will qualify as independent only if the director satisfies a series of objective tests, including that the director has not engaged in various types of business dealings with us, and that our Board affirmatively determines, on a subjective basis, that he or she has no material relationship with us, either directly or as a partner, stockholder or officer of an organization that has a relationship with us that would interfere with the exercise of independent judgment in carrying out the responsibilities of a director. Ownership of a significant amount of our stock, by itself, does not constitute a material relationship.

Upon the recommendation of the Nominating and Corporate Governance Committee, our Board has affirmatively determined all of our current directors are independent in accordance with the Nasdaq rules, other than Mr. Lindberg, who served as our Chief Executive Officer through December 31, 2022, and Mr. Sheedy, who serves as our President and Chief Executive Officer. In making these determinations, the Nominating and Corporate Governance Committee reviewed and discussed information provided by the directors and us regarding each director’s business and personal activities as they may relate to us and our management, and determined that no subjective independence concerns existed. Each member of the Committees is independent under Nasdaq rules.

Additionally, our Board has determined that each of the members of the Audit and Risk Committee and Compensation Committee qualify as independent in accordance with the additional independence rules established by the U.S. Securities and Exchange Commission (“SEC”) and Nasdaq.

DIRECTOR BACKGROUNDS AND QUALIFICATIONS

The following biographical information sets forth the business experience during at least the past five years of each director nominee and each other director as of April 19, 2024, together with a discussion of the specific experience, skills, expertise, backgrounds and other attributes that led to the conclusion that each director should continue to serve on the Board.

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2024 Class II Director Nominees

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Class III Directors with Terms Expiring in 2025

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Class I Directors with Terms Expiring in 2026

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Board Leadership Structure—Former CEO Serving as Chairman of the Board with Empowered Lead Independent Director

Mr. Lindberg was appointed as our Chairman of the Board effective December 31, 2022. The Board believes that Mr. Lindberg’s significant experience as our former Chief Executive Officer and detailed knowledge of our operations, finances, strategies and industry facilitates a strategic vision to set the overall tone and direction of the Company as well as clear leadership through consistency.

Concurrent with Mr. Lindberg’s appointment as Chairman, the Board appointed Mr. Ragatz (who previously served as Chairman since October 2014) to the role of Lead Independent Director. Our Corporate Governance Guidelines provide that our independent directors will elect a Lead Independent Director whenever the Chairman is not an independent director. Our Board believes that an effective Lead Independent Director, such as Mr. Ragatz, who has significant and clearly delineated responsibilities as set forth in our Corporate Governance Guidelines and significant experience after serving as our Chairman of the Board, ensures strong, independent oversight of management and promotes effective governance and Board efficiency. Mr. Ragatz qualifies as an independent director under applicable rules and regulations of the SEC and Nasdaq. Further, the Committees consist solely of independent directors and provide significant oversight and leadership of key Board functions.

Key Responsibilities of Lead Independent Director

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Corporate Governance Guidelines

Our Board has adopted Corporate Governance Guidelines, which describe the principles and practices that our Board will follow in carrying out its responsibilities. These guidelines cover a number of policies and practices, including certain matters described under “Proxy Summary—Governance Principles.” Additionally, these guidelines address:

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the role and responsibilities, size and composition of the Board;

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the independence of directors;

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the selection of Chairman of the Board and the Lead Independent Director;

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potential and actual conflicts of interest;

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consideration of matters impacting director service, including a change in present job responsibility;

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director orientation and continuing education;

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the conduct of Board meetings;

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standing Committees;

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expectations of directors;

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management succession planning;

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Board compensation;

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communications with stockholders and non-employee directors; and

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the process for evaluating Board performance.

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A copy of our Corporate Governance Guidelines is available on our website at https://investors.groceryoutlet.com under the “Corporate Governance” section.

Board and Committee Meetings and Annual Meeting Attendance

The Board and its Committees meet throughout the year at regularly scheduled meetings and also hold special meetings as needed. Additionally, they act by unanimous written consent when needed and appropriate. During the Fiscal Year 2023, there were five meetings of the Board, eight meetings of the Audit and Risk Committee, five meetings of the Compensation Committee and five meetings of the Nominating and Corporate Governance Committee. Each of our current directors attended over 90% of the aggregate meetings of the Board and its Committees on which they served during Fiscal Year 2023.

In addition, our independent directors regularly meet in executive session, without management present. The Lead Independent Director chairs these executive sessions of independent directors. Our fully independent Committees also regularly meet in executive session (chaired by the respective Committee Chair).

We strongly encourage our directors to attend our annual meetings of stockholders. Ten of our then eleven directors attended our 2023 annual meeting of stockholders.

Board Member Commitment Outside of the Boardroom

In addition to preparation for and attendance at regular and special meetings, our directors stay regularly informed on recent developments and current events affecting our business or industry through postings and other communications (from management, company advisors and other third party sources). They also participate in ad hoc meetings with management, special committees, certain meetings with investors and site visits to our stores from time to time.

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Board and Committees’ Role in Risk Oversight

Our Board and its Committees have extensive involvement in overseeing the Company’s risk management through their activities, some of which are noted below. We believe that the leadership structure of our Board and Committees provides appropriate risk oversight.

Enterprise Risk Management Process. Our Audit and Risk Committee oversees our approach to enterprise risk management, which is designed to work across our business to identify, assess, govern and manage risks (including all strategic, operational, compliance and financial risks across the organization) and our response to those risks. The Senior Director of Corporate Internal Audit & Enterprise Risk, who reports functionally and administratively to our Chief Financial Officer and directly to the Audit and Risk Committee, leads an annual risk assessment process. Through this process, risks are identified through a series of interviews and questionnaires, and then prioritized based on quantitative and qualitative factors that consider the likelihood and impact of the risk on our operations, current objectives and long-term strategies. Senior management aligns on critical risks and then identifies risk owners among the executive leadership team and a Board or a Committee for oversight. Less critical risks are subject to various levels of internal monitoring. Overall results are reported to and discussed with the Audit and Risk Committee annually and more frequently based on the materiality of specified risks. The Audit and Risk Committee provides updates to the Board, at least annually, on such review.

Cybersecurity, Data Privacy and Data Security. We consider cybersecurity to be an important issue affecting the enterprise both in terms of economic risk and reputational risk. Under the direction of our information technology department, we have implemented policies and controls in line with the requirements of the International Organization for Standardization and have assessed our cybersecurity maturity levels against the National Institute of Standards and Technology framework to

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set appropriate standards and guidelines. We monitor and remediate threats through our managed detection and response, and our vulnerability management programs. We provide regular employee communications and mandatory training, periodically review our incident response and breach notification plan, and leverage third-party expertise for testing, assessments and improvements. We have an onboarding and periodic security review process of all third party vendors who have or will have access to our confidential information. We also have established business continuity disaster recovery plans that are designed to limit downtime and data loss in the event of a security breach. As we have increased our remote workforce in recent years, the Audit and Risk Committee and management have focused on enhancing the security of remote access with trusted devices, endpoint security controls and infrastructure resiliency.

We have a written incident response plan that is implemented by our cybersecurity incident response team, comprised of members of our information security, legal, human resources, finance and communications teams, and whose function is to respond to any such incident, define and seek to control the extent of the incident, assess and take reasonable actions intended to remediate any damage caused, and implement measures designed to prevent future reoccurrences. The materiality of any cybersecurity incident is evaluated by senior management, including the legal and finance departments, and, in certain circumstances by our third-party advisors. We periodically perform simulations (referred to as “tabletop exercises”) at a management level with external resources and advisors.

We carry cyber risk insurance that is intended to provide protection against a breach or other data security incident (see our risk factors in our 2023 Annual Report relating to cybersecurity and cybersecurity insurance).

Compensation Risk Analysis. The Compensation Committee reviews management’s annual assessment of our compensation programs and policies for our executive officers as well as for our other employees to determine whether those programs and policies encourage excessive risk taking that are reasonably likely to have a material adverse effect on our Company. Our compensation policies and practices (including those for our NEOs described in more detail under “Compensation Discussion and Analysis” below) balance short- and long-term performance goals and award vehicles, as well as the mix of the cash and equity components. Further, our most significant programs are overseen by the Compensation Committee, directly or through delegation of authority, and have strong risk mitigants, including market-based benchmarking throughout the organization and reasonable payout caps and, for our executives and directors, our clawback policies and stock ownership guidelines. Based upon this review, the Compensation Committee believes the elements of our compensation programs and policies do not encourage unnecessary or excessive risk-taking that are reasonably likely to have a material adverse effect on us.

Annual Board and Committee Self-Evaluations

The Board is committed to a thorough annual self-assessment process led by the Chair of the Nominating and Corporate Governance Committee (which process may from time to time include the engagement of a third-party consultant). This process is used as an important tool to promote Board effectiveness and continuous improvement. This self-assessment process involves filling out detailed questionnaires and having an individual meeting with the Chair of the Nominating and Corporate Governance Committee which elicits each director’s input regarding various board and committee effectiveness topics such as stewardship and board/committee dynamics. Through this process, areas where the Board functions effectively and areas where the Board believes it can improve are identified and discussed. Improvement opportunities generally are assigned to develop and drive action plans.

Committees of the Board

The standing Committees of our Board include: the Audit and Risk Committee, the Compensation Committee, and the Nominating and Corporate Governance Committee. The composition and responsibilities of each standing Committee are described below, as well as above under “Board and Committees’ Role in Risk Oversight”. Members serve on Committees until their resignation, retirement or other termination of service, or until otherwise determined by our Board. Current copies of the charters for each of these Committees are available on our website at https://investors.groceryoutlet.com, under the “Corporate Governance” section.

The following table sets forth the standing Committees and their Chairs and members as of the date of this Proxy Statement. Neither Mr. Lindberg nor Mr. Sheedy serve on any standing Committees.

In early 2023, Ms. Haben was appointed Chair of the Nominating and Corporate Governance Committee, replacing Mr. Ragatz.

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Audit and Risk Committee.   The Audit and Risk Committee is solely and directly responsible for the appointment, compensation, retention, oversight of the work and termination, if any, of our independent registered public accounting firm, Deloitte & Touche LLP (“Deloitte & Touche” or “Deloitte”). The additional primary responsibilities of the Audit and Risk Committee are to provide assistance to the Board regarding:

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oversight of the quality and integrity of the Company’s financial statements, including the oversight of the Company’s accounting and financial reporting processes (including relating to internal control over financial reporting and disclosure controls and procedures) and review of reports filed or furnished to the SEC that include financial statements or results;

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review and assessment of the independent registered public accounting firm’s qualifications, planned audit procedures performance and independence;

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oversight of the Company’s legal and regulatory compliance related to financial reporting and internal controls;

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oversight of the Company’s corporate compliance program, including the Code of Business Conduct and Ethics (the “Code of Ethics”), and investigations of possible violations thereunder;

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oversight of the Company’s framework and approach to enterprise risk management, and the identification of risks and risk mitigating activities;

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the preparation of the Audit and Risk Committee report included in our proxy statements, as well as the review of related disclosures in such proxy statements;

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review of the work plan, staffing and performance of the Company’s internal audit function, including regarding internal control testing;

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review of the Related Persons Transactions Policy and review and, if appropriate, approval of proposed related person transactions in accordance with such policy;

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review and oversight of the Company’s significant insurance policies; and

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other responsibilities noted in the Audit and Risk Committee report included in this Proxy Statement.

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The Board has determined that each of Messrs. Bachman and Herman qualifies as an audit committee financial expert under SEC rules, and that each member of the Audit and Risk Committee has sufficient knowledge in reading and understanding financial statements to serve on such Committee.

Compensation Committee.   The primary responsibilities of the Compensation Committee are to provide assistance to the Board regarding:

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being solely and directly responsible for the engagement, qualifications, scope of work, performance, independence and fees of the Compensation Committee’s independent compensation consultant;

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evaluating, with the assistance of the President and CEO, the performance of the executive officers (other than the CEO);

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annually determining the appropriate peer group and survey data in connection with evaluating executive compensation and benefits;

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approval of the compensation program and target compensation of the Company’s executive officers (other than the CEO) and recommending to the full Board the compensation program and compensation of the non-employee members of the Board;

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considering on an annual basis an assessment of whether risks arising from the Company’s compensation policies and practices for all employees, including non-executive officers, are reasonably likely to have a material adverse effect on the Company;

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monitoring or administering incentive and equity-based compensation plans;

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reviewing and approving stock ownership guidelines for directors and executive officers and “clawback” policies of the Company;

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review any compensation-related disclosures in our proxy statements, including reviewing and discussing with management our “Compensation Discussion and Analysis” and producing the Compensation Committee Report included in our proxy statements, and reviewing any stockholder proposals related to such matters; and

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overseeing certain matters related to human capital management.

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The Board has determined that each member of the Compensation Committee qualifies as a non-employee director under applicable rules and regulations of the SEC.

To the extent permitted by applicable law and the Nasdaq rules, the Compensation Committee may delegate its responsibilities to a subcommittee and may authorize members of our Human Resources department to carry out certain administrative duties regarding our compensation programs. Pursuant to delegated authority from the Compensation Committee, the Committee Chair and the President and Chief Executive Officer approve certain equity awards for non-executive officer employees, subject to specified limitations.

For Fiscal Year 2023, the Compensation Committee determined to re-engage Korn Ferry as its independent consultant. In connection with such engagement, the Committee reviewed the independence of Korn Ferry based on the factors specified by Nasdaq as well as other factors it deemed relevant, and any potential conflicts of interest raised by the work of Korn Ferry. In Fiscal Year 2023, management engaged Korn Ferry for consulting services regarding certain non-executive compensation matters. The fees for those services were less than $120,000. The Committee determined that there were no conflicts of interest raised by Korn Ferry’s work for management. For information on the processes and roles for determining compensation, including the role of the Compensation Committee’s independent consultant, Korn Ferry, and the role of our President and Chief Executive Officer, in the consideration and determination of executive compensation, see “Compensation Discussion and Analysis” below.

Nominating and Corporate Governance Committee.   The primary responsibilities of the Nominating and Corporate Governance Committee are to provide assistance to the Board regarding:

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developing and recommending to the Board a set of corporate governance principles applicable to the Company, including reviewing key governance policies of the Company (including the Corporate Governance Guidelines and Code of Ethics) and monitoring or administering such policies as specified therein;

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identifying and evaluating individuals qualified to become directors (including candidates nominated or recommended by stockholders), consistent with the criteria approved by the Board and set forth in Company policies, and recommending to the Board the director nominees for the next annual meeting of stockholders or to fill vacancies or newly created directorships that may occur between such meetings;

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reviewing director independence;

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evaluating the composition the Board and considerations related to director succession planning;

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reviewing Committee membership and Board and Committee leadership roles and succession planning for such roles;

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overseeing the annual evaluation of the Board and its Committees;

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reviewing any governance-related disclosures in our proxy statements and reviewing any stockholder proposals related to such matters;

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reviewing matters of corporate responsibility and sustainability, including potential long- and short-term trends and impacts to the Company’s business of ESG issues, and the Company’s public reporting on these topics;

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oversight of management and director engagement with stockholders relating to ESG; and

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review and approval of policies relating to compliance with securities laws and security trading by the Company’s directors, officers and other employees.

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Stockholder Engagement

Our Board and management value the opportunity to engage with our stockholders and prospective stockholders to better understand and focus on the priorities that matter most to them, and to foster consistent and constructive dialogue. Periodically, our Investor Relations team, certain members of management and our Lead Independent Director proactively initiate investor outreach efforts through requested meetings with stockholders. Additionally, throughout the year, our Investor Relations team and leaders of our business proactively engage with our stockholders to seek their input, to remain well-informed regarding their perspectives and help increase their understanding of our business, industry and long-term strategy. In early Fiscal Year 2024 we reached out to our major investors and were able to engage with stockholders representing a majority of our issued and outstanding shares regarding ESG topics. The feedback received from our stakeholder outreach efforts is communicated to and considered by our Board and Board Committees, and our engagement activities have produced valuable feedback that helps inform our decisions and our strategy, where appropriate. The Board also receives regular reports from management regarding investor sentiment, institutional investor voting and governance policies, and trends in stakeholder issues, which informs the Board’s ongoing evaluation of appropriate governance and other practices.

Communications with the Board of Directors

Our Board welcomes correspondence from our stockholders. Stockholders may initiate in writing any communication with our Board, Board Chair or the Lead Independent Director by sending the correspondence to our General Counsel, c/o Grocery Outlet Holding Corp., 5650 Hollis Street, Emeryville, CA, 94608. This centralized process assists our Board in reviewing and responding to stockholder communications in an appropriate manner. The General Counsel will initially review and compile all such communications and may summarize such communications prior to forwarding to the appropriate party.

Our General Counsel will not forward communications that are not relevant to the duties and responsibilities of the Board, including spam, junk mail and mass mailings, product or service inquiries, new product or service suggestions, resumes or other forms of job inquiries, opinion surveys and polls, business solicitations or advertisements, or other frivolous communications.

Our Environmental, Social and Governance Approach

At Grocery Outlet, we believe that our long-term success is naturally aligned with our ability to positively impact our communities, our people and our planet. Our mission of Touching Lives for the Better has been core to the business from the start, and fulfilling this purpose has resulted in positive environmental and social impacts throughout our 78-year history. We

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have developed a holistic ESG strategy that aligns with our unique model. In Fiscal Year 2022, we began the process of documenting the positive ESG benefits inherent in our business, and in Fiscal Year 2023 we published our inaugural ESG report which focused on the positive impact we have on our communities, people and planet. The seven key impact areas highlighted in the report are:

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Saving Customers Money: Our discounts and bargains save customers money—an estimated 40% over conventional grocers on average—enabling them to save for life’s other expenses.

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Providing Affordable Quality Food: We increase food access in our communities by providing customers with affordable quality food from trusted, name-brand suppliers.

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Giving Back: We partner with our Independent Operators to give back to our communities by supporting local food banks, educational programs and other initiatives that uplift and empower those in need.

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Providing Opportunities to Independent Operators: We create unique opportunities for Independent Operators to be local business owners and entrepreneurs.

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Providing Opportunities for Employees: We focus on our values and culture, as well as our equity, diversity and inclusion initiatives, and help to create opportunities for our employees to grow and thrive.

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Reducing Food Waste: Our opportunistic sourcing model enables us to reduce food waste in partnership with our suppliers and Independent Operators.

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Improving Operational Efficiency: By improving operational efficiency, we strive to reduce our environmental impacts on energy use, food waste and carbon emissions.

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Our ESG Steering Committee (whose membership includes senior management) meets quarterly to discuss our ESG initiatives, goals and progress. At the Board level, our Nominating and Corporate Governance Committee is responsible for overseeing (and regularly receives reports reflecting) matters of corporate responsibility, sustainability and other environmental, social and governance issues, as well as our public reporting regarding these topics. Our Board also receives regular reports on our progress from the Nominating and Corporate Governance Committee and, at least once per year, from management. To support our efforts in this area, we have engaged an outside ESG advisor and we plan to publish our second ESG report during Fiscal Year 2024.

We plan to continue to solicit periodic feedback from our stakeholders and in early Fiscal Year 2024 we were able to engage with stockholders representing a majority of our issued and outstanding shares. We discussed our ESG strategy and initiatives, and elicited feedback on our inaugural ESG report and ESG priorities.

Our Commitment to Human Capital Management

At Grocery Outlet, our mission is to Touch Lives for the Better. To do this, we work together to foster and enhance a culture grounded in talented and passionate people who live our values: entrepreneurship, integrity, achievement, family, service to others, diversity and fun. Our employees are at the heart of who we are and what we do. Our values translate into our human capital offerings to recruit, engage, develop, reward and retain employees who believe in our mission and emulate our values. As of the end of Fiscal Year 2023, we had 997 employees, 901 of whom were full-time and 96 of whom were part-time, including: (i) 516 of our employees at our corporate headquarters in Emeryville, California, and our Leola, Pennsylvania office, 158 of which were classified as field employees, (ii) 355 of our employees at our distribution centers, and (iii) 126 employees in our Company-operated stores.

BOARD INVOLVEMENT IN HUMAN CAPITAL MATTERS

Our Board and Committees provide oversight on human capital matters and risks including employee engagement, equity, diversity and inclusion (“ED&I”), talent development and succession planning. Our full Board provides oversight of our executive management, talent development, succession planning and talent acquisition, and has access to key leaders and other key talent throughout the organization through participation in Board and Committee meetings. Our Audit and Risk Committee provides oversight for enterprise risk management. Our Nominating and Corporate Governance Committee oversees the effectiveness of our governance and social responsibility policies, goals and programs. Our Compensation

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Committee provides oversight of our total rewards offerings for employees and conducts both a yearly compensation benchmarking assessment and yearly compensation risk assessment.

EMPLOYEE DEVELOPMENT

We seek to grow leaders at every level of our organization by creating a culture of mentoring and coaching. As part of our succession planning, we prioritize growing talent internally within our organization and invest resources to develop our employees’ skill sets and career paths. As an example, our current Chief Executive Officer, Robert J. Sheedy, Jr., joined Grocery Outlet in 2012 as our VP of Strategy and thereafter was promoted three times before becoming President and Chief Executive Officer in January 2023. Some of our offerings during Fiscal Year 2023 (offered virtually and, in some cases, in person) included:

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Certification program opportunities, including offerings in personal growth and professional development;

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Lunch and learn events, featuring a wide variety of personal development topics and industry speakers; and

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Individual coaching for leadership development, and other leadership training on an ad hoc basis.

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During Fiscal Year 2023, we promoted 79 corporate and field employees.

EMPLOYEE COMPENSATION AND BENEFITS

We provide compensation and comprehensive benefits designed to recruit and retain the talent necessary to advance our mission, meet our business goals and execute our long-term growth strategy. Our compensation components vary by employee level and include cash base compensation, cash bonuses, equity awards and a profit-sharing program. As part of our IPO, each of our then current employees, regardless of level, was granted an equity award which vested in one tranche in June 2023. Our generous and highly competitive health and welfare benefits programs during Fiscal Year 2023, available equitably to full-time employees, include:

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Leading healthcare offered to employees, including medical, vision, dental, life insurance, accidental death and dismemberment, long-term disability, health savings accounts and wellness programs that encourage improved health while having fun;

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Free access to financial planning/training and wellness education and health challenges;

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Free access to on demand mental health support, providing confidential coaching and counseling;

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A 401(k) and profit-sharing program available to all employees meeting eligibility requirements (See “Compensation Discussion and Analysis” below for further information); and

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An education assistance program providing tuition reimbursement for eligible employees seeking to improve their job-related skills through additional education (subject to the conditions of the program). We also participate in the California Grocers Association Educational Foundation program to offer scholarships to employees, IOs and dependents.

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CULTURE AND EQUITY, DIVERSITY AND INCLUSION

We report annually on employment data, including ethnicity, in line with U.S. Equal Employment Opportunity Commission guidelines and we believe that a diverse and inclusive team is critical to our long-term business success and makes us a better company.

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Racial and Ethnic data excludes employees who choose not to disclose or who left the field blank.

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In Fiscal Year 2023, of the 79 promoted corporate and field employees, 49% were female and 46% were racially and ethnically diverse, excluding employees who chose not to disclose or left the field blank.

Additionally, and as part of our commitment to transparency, we are committed to disclosing our workforce diversity data (by gender, race and ethnicity) that we include in our consolidated EEO-1 report, beginning with 2024 data to be included in our ESG Report that will be published in 2025. We will at that time also make such EEO-1 report available on our Investor Relations website.

We have several employee resource groups (“ERGs”) that enhance our inclusive and diverse culture, including our overarching ED&I Council, our Black Partnership Network and our WOW! (Winning with Outstanding Women) Network. We also invite the launch of new ERGs with our ERG resource guide. We provide regular training and open employee discussions on diversity topics, including those relating to current events in our communities. In Fiscal Year 2023, we encouraged all employees to participate in an engagement survey, which included a set of ED&I questions. The questions were designed to measure employee beliefs and attitudes about the Company’s progress toward executing its ED&I strategy. We had a response rate of over 90% and the results highlighted both our successes and opportunities with respect to our ED&I practices. Also in Fiscal Year 2023, we provided and required unconscious bias training for all employees at the director or above level.

We have made concerted efforts to expand the diversity of our Board and our executive leadership. Currently, of the eight non-independent members of our Board, three are women, one member is Black and one of the chairs of the Board’s Committees is a woman. Our senior leadership team consists of sixteen individuals, four of whom are women, two of whom are Black, two of whom are Asian, one of whom is an Indigenous person, and one of whom is LatinX and part of the LGBTQ+ community.

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We will continue to focus on cultivating an inclusive and diverse corporate culture through continued education for all our employees, ERGs and talent development across our organization.

We strive to nurture and uphold an inclusive, diverse environment free from discrimination of any kind, including sexual or other discriminatory/harassing behavior. We do this by setting an appropriate tone at the top with an open-door policy and robust policies/procedures such as our Code of Ethics (which includes access to an anonymous hotline) as well as an internal audit function—all of which support compliance with regulations and ethical behavior. We conduct regular training on all of our corporate policies, including on our Code of Ethics and Securities Trading Policy, and on topics such as workplace harassment and cybersecurity.

COMMUNITY INVOLVEMENT

The commitment by Grocery Outlet to our communities extends well beyond our offices and storefronts. We pride ourselves on giving back to local communities. In Fiscal Year 2023, through a coordinated effort with our Independent Operators and suppliers involving food, cash and online donations, we held our 13th Annual Independence from Hunger food drive, which supported over 400 non-profit agencies and helped reduce food insecurity and food waste within the communities in which we operate. In the 13 years Grocery Outlet has run this food drive, we and our IOs have raised over $20 million to fight food insecurity.

As an additional part of our efforts to fight hunger and minimize food waste, for decades our IOs have partnered with local food bank organizations to donate food and other items that would have otherwise been thrown away. California law SB 1383 now formally requires, among other things, that we and our IOs in California donate a certain amount of edible food that would otherwise have been thrown away to food recovery organizations. Our IOs in California have adopted formal donor partner agreements to ensure that their regular donating activities meets the technical requirements of this new legislation.

COMPANY FOUNDATION

In 2011, we established the Touching Lives Foundation, a 501(c)(3) nonprofit organization. The Foundation’s purpose is to help people within the Grocery Outlet family (i.e. employees and immediate family members of Grocery Outlet or Independent Operators) who have financial need resulting from a catastrophic life event. The Foundation has covered expenses, among others, related to illness, funeral expense, emergency travel, temporary housing and relocation. The Touching Lives Foundation receives financial support from the Board members, management and employees of Grocery Outlet, Independent Operators, an annual corporate endowment from Grocery Outlet Inc., as well as outside donors.

Code of Business Conduct and Ethics

We have adopted a Code of Ethics applicable to all employees, executive officers and directors that addresses legal and ethical issues that may be encountered in carrying out their duties and responsibilities, including the requirement to report any conduct they believe to be a violation of the Code of Ethics. The Code of Ethics is available under the Corporate Governance tab of our Investor Relations page of our website at https://investors.groceryoutlet.com. If we ever were to amend or waive any provision of our Code of Ethics that applies to our principal executive officer, principal financial officer, principal accounting officer or any person performing similar functions, we intend to satisfy our disclosure obligations with respect to any such waiver or amendment by posting such information on our Internet website set forth above rather than by filing a Current Report on Form 8-K.

Director Compensation

Pursuant to our Non-Employee Director Compensation Policy, cash and equity compensation is paid or granted, as applicable, to each member of our Board who is not an employee of us or any parent or subsidiary of us (each, a “non-employee director”).

Our Board (following benchmarking analysis from and consultation with Korn Ferry) approved an amendment to the non-employee director compensation policy effective as of January 1, 2023. In particular, (i) the annual cash retainer for the Chairman increased from $205,000 to $225,000 and (ii) an annual cash retainer was approved for the newly established role of Lead Independent Director.

Corporate Governance and Board Matters​

Non-Employee Director Cash Compensation

Under our non-employee director compensation policy in effect for Fiscal Year 2023, non-employee directors receive the following cash compensation:

The annual cash retainers are earned on a quarterly basis based on a calendar quarter.

Under our current non-employee director compensation policy, none of our directors receive separate compensation for attending meetings of our Board or any Committees. All directors are reimbursed for travel and other expenses directly related to director activities and responsibilities.

Non-Employee Director Equity Compensation

The current non-employee director compensation policy provides that each non-employee director will be granted an RSU award under our 2019 Incentive Plan (the “2019 Incentive Plan”) with respect to a number of shares of our common stock having a grant value of $125,000. The number of shares underlying the annual RSU grant is calculated by dividing $125,000 by the fair market value of our common stock (which is the closing price of a share of our common stock on Nasdaq) on the annual RSU grant date, rounded up to the next whole share. Non-employee directors who join the Board mid-vesting cycle receive a prorated grant.

Subject to the non-employee director’s continued service with us on the applicable vesting date, the annual RSU awards will generally vest in full upon the earlier of (i) the completion of twelve months from the grant date or (ii) the anniversary of the prior year’s annual meeting of stockholders. The annual RSU awards will vest in full upon a change in control. Upon vesting, the annual RSU grant will be settled in shares of our common stock within 30 days of the date on which the relevant vesting date occurs.

Director Stock Ownership Guidelines

Our director equity ownership guidelines provide that our non-employee directors are expected to achieve and maintain ownership of equity with a total value equal to five times the annual cash retainer for Board service ($75,000 for Fiscal Year 2023). Non-employee directors are expected to initially satisfy such guidelines within a five-year initial compliance period. As of December 30, 2023, all non-employee directors in service were either in compliance with the guidelines or within the compliance period and making appropriate progress.

Corporate Governance and Board Matters​

For purposes of the guidelines, a director’s holdings include: (i) shares of our common stock owned separately by the director or owned either jointly or with, or separately by, such person’s immediate family; (ii) shares of our common stock held in trust for the benefit of the director or such person’s immediate family members; (iii) shares of our common stock purchased in the open market; (iv) shares of our common stock obtained through stock option exercises (and not thereafter sold); (v) vested but unexercised in-the-money stock options; and (vi) shares of restricted stock and RSUs, in each case, whether vested or unvested. Directors must hold 50% “net shares” ​(shares of our common stock remaining after any tax liability is settled) received from their equity awards until the guidelines are met.

Fiscal Year 2023 Director Compensation Table

The following table summarizes the compensation paid to or earned by our directors in Fiscal Year 2023, excluding Mr. Sheedy who does not receive any compensation for his director service and whose compensation is disclosed in the Summary Compensation Table.

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(1)

Amounts reported in this column represent the grant date fair value of RSUs granted. RSU awards listed in this column may be deferred under the Deferral Plan. These amounts do not reflect actual amounts that may be paid to or realized by the director. The grant date fair value of the RSUs is calculated as the closing price of our common stock as quoted on Nasdaq on the grant date multiplied by the number of shares of our common stock subject to the award. See Note 8, Share-based Awards to our consolidated financial statements contained in our 2023 Annual Report for a discussion of all assumptions made by us in determining the grant date fair value in accordance with Financial Accounting Standards Board (the “FASB”) Accounting Standards Codification (“ASC”) Topic 718.

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The RSU award granted on June 21, 2023 to each of our non-employee directors (other than Mr. Matthews who retired effective the same day) was for 5,837 shares of our common stock under our 2019 Incentive Plan. Such grant represented the $125,000 annual grant as set forth in our non-employee director compensation policy, as well as an additional amount equal to $38,027. In Fiscal Year 2023, the Compensation Committee shifted the annual grant date for the non-employee director annual RSU awards from March to the date of our annual meeting of stockholders. The $38,027 incremental amount of the dollar value of the RSU award in Fiscal Year 2023 represented compensation for the period between March 1, 2023 (when the Fiscal Year 2022 award had fully vested) to the June 21, 2023 grant date. For information regarding Mr. Matthews’ RSU award, please see Footnote 2.

(2)

Mr. Matthews retired from our Board on June 21, 2023 after over eight years of service as a director. Immediately following his retirement, we entered into a consulting agreement with him to assist us with developing, reviewing and refining the Company’s policies, strategies and programs, together with providing advice and assistance on such matters relating to the business of the Company from time to time. The term of the agreement ended on December 31, 2023. As consideration for Mr. Matthews’ consulting services, the Board awarded him an RSU award equal to $105,000 on the day of grant (which had a grant date fair market value of $105,002), which vested in full on December 31, 2023.

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Director Deferral Program

On November 6, 2020, the Compensation Committee approved the Grocery Outlet Holding Corp. Directors Deferral Plan (the “Deferral Plan”). All of our current non-employee directors are eligible to participate in the Deferral Plan. Under the terms of the Deferral Plan, non-employee directors may elect to defer all of their annual cash compensation and/or all of the shares of our common stock issued upon settlement of their annual RSU award, in each case, in the form of deferred stock units (“DSUs”) credited to an account maintained by us. The number of DSUs credited in respect of annual cash compensation is determined

Corporate Governance and Board Matters​

by dividing the dollar amount of the deferred cash compensation by the fair market value of a share of our common stock on the date the cash compensation would otherwise have been paid to the director. DSUs are awarded from, and remain subject to the terms of, the 2019 Incentive Plan.

Each DSU represents the right to receive a number of shares of our common stock equal to the number of DSUs initially credited to the director’s account plus the number of DSUs credited as a result of any dividend equivalent rights (to which DSUs initially credited to a director’s account are entitled). Directors may elect that settlement of DSUs be made or commence on (i) the first business day in a year following the year for which the deferral is made, (ii) following termination of service on the Board or (iii) the earlier of (i) or (ii). Directors may elect that DSUs be settled in a single one-time distribution or in a series of up to 5 annual installments. In addition, DSU accounts will be settled upon a Change in Control (as defined in the 2019 Incentive Plan) or upon a director’s death. See “Securities Ownership of Certain Beneficial Owners and Management” for information regarding outstanding DSUs held by our directors.

AUDIT AND RISK COMMITTEE REPORT

Committee Membership

The Audit and Risk Committee of the Board (solely for the purpose of this report, the “Committee”) consists of John E. Bachman (Chair), Thomas F. Herman, Gail Moody-Byrd, and Jeffery R. York. The Board has determined, in accordance with applicable Nasdaq and SEC rules and regulations, that all of the Committee members are independent and able to read and understand financial statements, and Messrs. Bachman and Herman are audit committee financial experts.

Charter and Responsibilities

The Committee operates under a written charter adopted by the Board, which is available on our website at https://investors.groceryoutlet.com. The Committee reviews the charter annually and works with the Board to make appropriate amendments that reflect the evolving role of the Committee.

Among other responsibilities set forth in its charter, the Committee assists the Board in overseeing our financial reporting, internal control and audit processes, monitoring our compliance with significant legal and regulatory requirements related to financial reporting and internal controls, overseeing the Company’s framework and approach to enterprise risk management, reviewing the work plan, staffing and performance of the Company’s internal audit function, and evaluating the qualifications, scope of work, performance and independence of our independent registered public accounting firm. The Committee also is responsible for appointing, and establishing the compensation and other terms of retention, of our independent registered public accounting firm.

Management has the primary responsibility to establish and maintain an effective system of internal control over financial reporting and disclosure controls and procedures, to prepare and present fair and accurate financial statements and reports filed with or furnished to the SEC, to implement appropriate accounting and financial reporting principles, and to comply with applicable laws and regulations. Our independent registered public accounting firm, Deloitte & Touche, LLP, is responsible for performing independent audits of our consolidated financial statements and the effectiveness of internal control over financial reporting in accordance with the auditing standards of the Public Company Accounting Oversight Board (United States) (the “PCAOB”) and to issue reports thereon. The Committee does not provide any expert or other special assurance as to the Company’s financial statements or any expert or professional certification as to the work of our independent registered public accounting firm.

Fiscal Year 2023 Financial Statements

In the performance of its oversight function, the Committee reviewed and discussed our audited consolidated financial statements included in our 2023 Annual Report and the reporting process with the Company’s management and Deloitte, as well as Deloitte’s audit report. The Committee also reviewed and discussed Deloitte’s overall audit scope and work plan throughout the course of the audit for Fiscal Year 2023. Further, the Committee discussed with Deloitte, with and without management present, the effectiveness of our internal control over financial reporting, and reviewed and discussed Deloitte’s internal control report. In addition, the Committee discussed with Deloitte the required communications by the applicable requirements of the PCAOB and the SEC. These communications included Deloitte’s perspective on the quality (not merely the acceptability) of the Company’s accounting principles, the reasonableness of significant estimates and judgments made by management, including related disclosures regarding significant accounting policies included in our 2023 Annual Report, and critical audit matters addressed in Deloitte’s audit report. The Committee also met with senior management to discuss the processes they undertook to evaluate the accuracy and fair presentation of the Company’s consolidated financial statements and the effectiveness of the Company’s internal control over financial reporting and disclosure controls and procedures. In particular for Fiscal Year 2023, the Committee reviewed the identified material weakness in internal control over financial reporting regarding information technology controls in connection with the Company’s efforts to replace components of its enterprise resource planning system, and the related risks and mitigants that management evaluated to ensure that there were no material misstatements in the financial statements included in the 2023 Annual Report. Certain of the foregoing matters are discussed in executive session solely with Deloitte, representatives of management or the Committee alone. Based on the review and discussions with management and Deloitte described above, the Committee recommended to the Board that the audited consolidated financial statements be included in our 2023 Annual Report.

Other Reporting Matters

During Fiscal Year 2023, the Committee reviewed and discussed with management and Deloitte the unaudited quarterly financial statements included in our Quarterly Reports on Form 10-Q filed with the SEC and the required communications for

Audit and Risk Committee Report​

an interim review by the applicable requirements of the PCAOB and SEC, our earnings press releases, our earnings guidance, and the use and presentation of non-GAAP financial information. Further, during Fiscal Year 2023, the Committee considered our critical accounting policies and significant judgements and estimates, and changes in the Company’s accounting practices, principles, controls and methodologies applicable to its financial statements. The Committee also reviewed with management the Company’s enterprise risk management framework, including significant risks and exposures identified by management, strategies to mitigate identified risks, as well as the overall effectiveness of the Company’s legal, regulatory and compliance programs.

Independence and Pre-Approval Policy

The Committee received and reviewed the written disclosures and the letter from Deloitte required by the applicable requirements of the PCAOB regarding Deloitte’s communications with the Committee concerning independence. As part of its ongoing independence evaluation of Deloitte, the Committee also evaluated the amount of non-audit service requests and approved services that we obtain from Deloitte and whether it was compatible with its independence, as well as the PCAOB’s oversight of Deloitte through the establishment of audit, quality, ethics, and independence standards and conducting audit inspections. Based on the foregoing considerations and other matters, the Committee concurred with Deloitte’s conclusion that it was independent under applicable standards.

The Committee’s policy is to pre-approve all audit and permissible non-audit services provided by Deloitte. For each proposed service, Deloitte provides the Committee with a description of the service and sufficient information to confirm Deloitte’s determination that the provision of such service will not impair independence. The Committee reviewed and pre-approved all audit and non-audit services performed by Deloitte during Fiscal Year 2023 in accordance with established procedures.

Independent Registered Public Accounting Firm Tenure and Rotation

As part of its appointment process, the Committee considers whether to rotate the independent registered public accounting firm. Deloitte has been our independent registered public accounting firm since 2007, and the Committee recently approved the appointment of Deloitte as our independent registered public accounting firm for the Fiscal Year 2024. In addition, the Committee oversees the process for evaluation and selection of the lead audit engagement partner every five years. In determining that the re-appointment of Deloitte was in the best interests of the Company and its stockholders, the Committee considered the following, among other matters:

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The significant benefits from Deloitte’s extensive historical experience, including higher quality audit work and accounting advice due to Deloitte’s institutional knowledge of and familiarity with our business and operations, accounting policies and financial systems, and internal control framework;

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Operational efficiencies and a resulting fee structure that is appropriate and reasonable relative to scope of services because of Deloitte’s history and familiarity with our business;

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The positive assessment by management and the Committee regarding Deloitte’s performance of services during Fiscal Year 2023;

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•

Deloitte’s qualifications, capabilities and expertise, evident through its audit planning and reports, industry knowledge, resources (including its subject matter experts and investment in auditing technologies) and staffing (including annual assessment of the adequacy of personnel on our account, objectivity and professional skepticism);

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Deloitte’s rigorous process for monitoring and maintaining independence, and its transparent disclosure regarding related considerations; and

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The quality and frequency of Deloitte’s communications to and interactions with the Committee, including the Chair, at meetings and between meetings.

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The foregoing report of the Audit and Risk Committee does not constitute soliciting material and shall not be deemed filed, incorporated by reference into or a part of any other filing by the Company (including any future filings) under the Securities Act of 1933, as amended (the “Securities Act”), or the Securities Exchange Act of 1934, as amended (the “Exchange Act”), except to the extent the Company specifically incorporates such report by reference therein.

OTHER AUDIT AND RISK COMMITTEE MATTERS

FEE INFORMATION

The following table sets forth fees in connection with services rendered by Deloitte & Touche LLP, the Company’s independent registered public accounting firm, for Fiscal Year 2023 and Fiscal Year 2022.

Audit Fees

Audit fees include fees for professional services rendered in connection with the annual audit of the Company’s financial statements and the review of the Company’s interim financial statements included in quarterly reports, as well as fees for services that generally only the independent registered public accounting firm can be reasonably expected to provide, including comfort letters, consents, and review of registration statements filed with the SEC. Fiscal Year 2023 audit fees include audit services provided in connection with the implementation of upgraded components of our enterprise resource planning system.

Tax Fees

Tax fees include fees for professional services rendered for tax compliance and tax consultation. Fiscal year 2023 tax fees include tax planning services as well as consultation services related to tax rules which became effective in 2023.

All Other Fees

All other fees include fees for a technical accounting research tool subscription service.

AUDIT AND RISK COMMITTEE PRE-APPROVAL POLICIES AND PROCEDURES

Under our Audit and Risk Committee’s charter, the Audit and Risk Committee must pre-approve all audit and other permissible non-audit services proposed to be performed by the Company’s independent registered public accounting firm. In pre-approving such services, the Committee considers whether the provision of services is consistent with maintaining the independence of the independent registered public accounting firm, including under applicable law. The Committee may delegate authority to one or more independent members to grant pre-approvals of audit and permitted non-audit services, provided that any such pre-approvals will be presented to the full Committee at its next scheduled meeting.

All of the services provided by Deloitte & Touche LLP described above were approved by our Audit and Risk Committee. The Audit and Risk Committee approved a pre-approval policy for services provided by the independent registered public accounting firm. Under the policy, our Audit and Risk Committee has pre-approved the provision by the independent registered public accounting firm of certain services that fall within specified categories. Any services exceeding pre-approved cost levels or budgeted amounts, or any services that fall outside of the general pre-approved categories, require specific pre-approval by the Audit and Risk Committee.

EXECUTIVE OFFICERS

The following table sets forth information about our executive officers as of April 9, 2024:

Set forth below is a brief description of the business experience of our executive officers. See “Board of Directors—Director Backgrounds and Qualifications” for biographical and other information for Mr. Sheedy. Our executive officers are appointed by our Board and serve until their successors have been duly appointed and qualified or their earlier resignation, retirement or other termination of service.

Executive Officers​

Executive Officers​