Fox Factory Refreshes Board With 2 New Independent Directors

Fox Factory Holding Corp., which designs, engineers and manufactures performance suspension and related components, is entering into a cooperation agreement with Engine Capital and will undertake a strategic board refresh in pursuit of opportunities to enhance operational performance and profitability.

The company’s board of directors will appoint two new independent directors and form a board-level transformation committee to drive operational excellence and improve profitability, officials stated in a press release.

The first new director is Alan L. Bazaar, who currently serves as CEO and co-chief investment officer of Hollow Brook Wealth Management LLC and brings extensive public company board experience and expertise in value creation and capital allocation, the release stated. The second independent director, yet unnamed, will be identified by Engine Capital and approved by the board, and is expected to have operational expertise in manufacturing excellence and margin improvement initiatives.

“We appreciate the constructive dialogue we have had with Engine Capital,” said Mike Dennison, chief executive officer of Fox Factory. “While we are proud of the premium brand portfolio and innovation capabilities we have built, we recognize the significant opportunity to drive stronger operational execution and translate those capabilities into enhanced financial performance. The board refresh and formation of the transformation committee reflect our shared commitment to unlocking the value embedded in our business.”

Arnaud Ajdler, managing partner of Engine Capital, said the company appreciates the Fox Factory board’s responsiveness and engagement.

“We believe the appointment of two new directors and the formation of the transformation committee reflect a shared commitment to operational excellence,” he noted. “With a sharpened focus on execution and disciplined cost management, the company is well-positioned to drive meaningful and sustainable long-term shareholder value. We look forward to working collaboratively with the board and management team.”

TRANSFORMATION COMMITTEE

The Fox board will form a transformation committee chartered to provide oversight of management’s execution of operational improvement initiatives targeting enhanced profitability, working capital efficiency and disciplined capital allocation. The committee will be chaired by Sidney Johnson and will include both new directors and an additional existing independent director, the release revealed.

“The board has been actively engaged with management on a comprehensive operational review,” said Dennison. “The transformation committee will ensure oversight and accountability as we execute these initiatives.”

BOARD RETIREMENTS

Also, Ted Waitman and Dudley Mendenhall, the company’s chairman, will retire from the board, effective at the company’s annual meeting of stockholders later this year.

“I want to personally thank Dudley for his steady leadership as chairman during a pivotal period in our company’s evolution,” said Dennison. “His guidance has been instrumental in Fox Factory’s diversification and growth. I also extend deep appreciation to Ted for his many years of dedicated service to the board. Ted led with humility and genuine concern for the business and our people.”

The cooperation agreement includes customary standstill, voting, committee appointment rights and related provisions and will be filed with the U.S. Securities and Exchange Commission on Form 8-K.

Jefferies LLC is serving as financial advisor to Fox Factory and Wachtell, Lipton, Rosen & Katz is serving as legal counsel. Olshan Frome Wolosky LLP is acting as legal counsel to Engine Capital.