Fat Brands announces proposed settlement of stockholder derivative lawsuits

Fat Brands (FAT) announced that it has entered into a stipulation of settlement to resolve two stockholder derivative lawsuits pending in the Court of Chancery of the State of Delaware on behalf of the company against certain current and former directors and officers of the company. The stockholder derivative claims were filed in June 2021 (Case No. 2021-0511-NAC, relating to the companys December 2020 merger with Fog Cutter Capital Group), and March 2022 (Case No. 2022-0254-NAC, relating to the companys June 2021 recapitalization). The settlement will resolve all claims asserted against the named defendants in the derivative lawsuits without any liability or wrongdoing attributed to them personally or the company. Under the terms of the proposed settlement, the companys Board of Directors agreed to adopt and implement certain corporate governance modifications. In addition, the companys insurers will pay to the company $10M, from which fees and expenses of plaintiffs counsel will be deducted, and Fog Cutter Holdings LLC will contribute 200,000 shares of Twin Hospitality Group (TWNP), to the company. The settlement is subject to approval of the Court, and non-objection by the United States.