Fiesta Restaurant: Supplement to the proxy circular for the annual meeting of shareholders to be held on June 16, 2022 (PDF 96 KB)

SUPPLEMENT TO PROXY CIRCULAR

FOR THE ANNUAL MEETING OF SHAREHOLDERS

WILL TAKE PLACE ON JUNE 16, 2022

Dear shareholders,

The 2022 annual meeting of shareholders (the “Annual Meeting”) of Fiesta Restaurant Group, Inc. (“Fiesta”, the “Company”, “we”, “us” and “our”) will be held on Thursday, 6 June 16, 2022, at 10:00 a.m. EDT exclusively live via webcast at www.virtualshareholdermeeting.com/FRGI2022. This supplement to the Management Proxy Circular, dated June 8, 2022 (the “Supplement”) supplements the Company’s definitive proxy statement, filed with the United States Securities and Exchange Commission on April 29, 2022. , in connection with the Annual Meeting (the “Proxy Statement”). A copy of the proxy statement is available on our website at https://www.frgi.com/investor-relations/financial-information/sec-filings/sec-filings-details/default.aspx? Filing ID = 15772456. We urge you to read the proxy statement in its entirety. To the extent that the information contained herein differs from or updates the information contained in the proxy statement, the information contained herein supersedes the information contained in the proxy statement.

The purpose of this Supplement is to provide additional information regarding the Company’s commitment to recruit a racially or ethnically diverse candidate to serve on the Company’s Board of Directors (the “Board”) and information relating to the independence of directors. In deciding how to vote on Proposal 1, we encourage you to carefully read the relevant portions of the proxy statement and consider the information provided in this supplement.

We recommend that shareholders vote FOR Proposal 1 to re-elect Stacey Rauch and Nicholas Daraviras as directors of the Company.

Recently, the Company received the proxy analysis and reference policy voting recommendation from Institutional Shareholder Services (“ISS”) (the “ISS Report”). The ISS report recommended voting “AGAINST” the re-election of Stacey Rauch and Nicholas Daraviras as directors of the company. The ISS report said Ms Rauch, as chair of the corporate governance and nominating committee, had failed to establish racial or ethnic diversity on the board. The ISS report further stated that Mr. Daraviras should not be considered independent because Mr. Daraviras is co-chairman of Leucadia Asset Management Holdings LLC and Leucadia Asset Management LLC (collectively, “Leucadia”), each of which is a subsidiary wholly owned by Jefferies Financial Group Inc. (“JFG”), and an affiliate of JFG’s wholly owned subsidiary, Jefferies LLC, which has been engaged by the Company to provide advisory services related to the sale of Taco Cabana and received fees amounting to $2.0 million from Jefferies LLC during the fiscal year ended January 2, 2022. Accordingly, Fiesta wishes to address the concerns of ISS and any shareholder regarding the diversity of directors, underscore the Company’s commitment to recruiting a racially or ethnically diverse candidate to the Board of Directors and further address Mr. Daraviras’ independence.

BOARD COMMITMENT TO APPOINT ONE RACIAL OR ETHNIC DIVERSE DIRECTOR BY THE DATE OF THE COMPANY’S 2023 ANNUAL MEETING OF SHAREHOLDERS

Fiesta is dedicated to director diversity and diversity within the Company’s workforce. As set out in the Proxy Circular, the Board recognizes its responsibility to ensure that nominees to the Board are appropriately qualified and reflect a reasonable diversity of personal and professional experiences, skills, backgrounds and perspectives, including such background and outlook with respect to age, gender and sexual orientation, culture, race and national origin. With two board members who identify as women, including our chair, Ms. Rauch, we are currently in full compliance with Nasdaq diversity rules that require a diverse director by August 7, 2023. Additionally, a vote against Ms. Rauch could, in fact, make our board less diverse. Nonetheless, the board has committed to adding an additional diverse director prior to its next annual meeting of shareholders in 2023. With the board’s commitment, we would be in compliance with the additional requirements of the Nasdaq Diversity Rules, which require two directors diversified, ahead of the compliance date of August 6, 2025 for this second phase. Similarly, as of January 2, 2022, approximately 61% of the company’s U.S.-based employees identify as female and 92% identify as members of racial and/or ethnic minorities, while 33% of senior managers of society identified as female and 50% identified as a member of racial and/or ethnic minorities.

To this end, Fiesta is committed to further increasing the diversity of its Board of Directors and is committed to appointing a racially and/or ethnically diverse director by the date of the annual meeting of shareholders of 2023 of the company.

MR. DARAVIRAS VOLUNTARILY RESIGNS FROM THE CORPORATE GOVERNANCE AND APPOINTMENTS COMMITTEE

Mr. Daraviras satisfies applicable Nasdaq listing requirements for independence, however, ISS considers him to be a non-independent member of a key committee of the Board of Directors for the reasons set out above. Due to the affiliations set forth above, and notwithstanding his qualifications, ISS has advised its clients that it will be issuing a “No” voting recommendation for Mr. Daraviras with respect to his election to the Board at the Annual Meeting.

While the Board believes that Mr. Daraviras’ broad skill set makes him an asset to all committees and that his service as Co-Chair of Leucadia does not interfere with the exercise of independent judgment in the exercise of his responsibilities as a director and as a member of the Corporate Governance and Nominating Committee and the decision of the board’s audit committee that the transactions described were in accordance with the company’s policy on related party transactions, Mr. Daraviras voluntarily resigned from the Corporate Governance and Nominating Committee effective June 8, 2022. His resignation of a committee member has no effect on his continued service as a member of the Board and he continues to stand for election to the Board at the annual meeting. For greater clarity, Mr. Daraviras’ resignation from a committee is not the result of a disagreement with any board member or with the Company’s financial reporting.

The current members of the Corporate Governance and Nominating Committee are Stacey Rauch, Stephen P. Elker and Andrew V. Rechtschaffen.

We have retained the services of Okapi Partners LLC, an independent proxy solicitation firm, to assist us in the solicitation of proxies. Okapi Partners LLC will receive fees of approximately $12,500 for its services and will be reimbursed for its disbursements. If you have any questions or need assistance voting your common stock, please contact Okapi Partners LLC at (877) 629-6355.

Thank you for considering our recommendation. You can find additional information about our directors and our governance practices in the proxy statement. We value our ongoing dialogue with you and look forward to continued engagement.

Sincerely,

Louis Di Pietro

Senior Vice President, Director of Legal Affairs and Human Resources,

General Counsel and Secretary

Fiesta Restaurant Group, Inc.

Miami, Florida

June 8, 2022