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SCHEDULE 14A INFORMATION

Proxy Statement Pursuant to Section 14(a) of the

Securities Exchange Act of 1934

Filed by the Registrant  x                            Filed by a Party other than the Registrant  ¨

Check the appropriate box:

DIAMOND FOODS, INC.

(Name of Registrant as Specified In Its Charter)

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

Payment of Filing Fee (Check the appropriate box):

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November 27, 2013

To our stockholders:

You are cordially invited to attend the Diamond Foods, Inc. 2014 annual meeting of stockholders (“Annual Meeting”) to be held at 1050 S. Diamond Street, Stockton, California 95205 on Tuesday, January 14, 2014 at 8:30 a.m., Pacific Time.

The matters to be acted upon at the Annual Meeting are described in detail in the accompanying notice of the Annual Meeting and the proxy statement. The Annual Meeting materials include the notice, proxy statement, our annual report and proxy card, all of which are enclosed.

Please use this opportunity to contribute to our company by voting on the matters to come before this Annual Meeting. Stockholders who hold shares in their own name through our transfer agent, Computershare, or who hold physical stock certificates can cast their vote online or by telephone. To vote online or by telephone, follow the instructions for online voting contained within your Annual Meeting materials. If you do not wish to vote online or by telephone, please complete, date, sign and promptly return the enclosed proxy card in the enclosed postage-paid envelope so that your shares will be represented at the Annual Meeting. Voting online, by telephone or by returning the proxy card does not deprive you of your right to attend the Annual Meeting and to vote your shares in person. If you do attend the Annual Meeting and wish to vote your shares personally, you may revoke your proxy at or prior to the Annual Meeting.

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Diamond Foods, Inc.

600 Montgomery Street

San Francisco, California 94111

NOTICE OF 2014 ANNUAL MEETING OF STOCKHOLDERS

To Be Held on January 14, 2014

This notice of annual meeting, proxy statement and form of proxy are being distributed and made available on or about December 3, 2013.

Important Notice Regarding the Availability of Proxy materials for the Stockholder Meeting to Be Held on January 14, 2014: Our proxy statement and annual report on Form 10-K are available at www.diamondfoods.com.

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Diamond Foods, Inc.

600 Montgomery Street

San Francisco, California 94111

PROXY STATEMENT

November 27, 2013

Information about the Annual Meeting

The accompanying proxy is solicited on behalf of the Board of Directors (“Board”) of Diamond Foods, Inc., a Delaware corporation (“Diamond Foods”, “Diamond” or “Company”), for use at the 2014 annual meeting of stockholders (“Annual Meeting”). The Annual Meeting will be held at 1050 S. Diamond Street, Stockton, California 95205 on Tuesday, January 14, 2014 at 8:30 a.m., Pacific Time. This proxy statement and the accompanying form of proxy card were first mailed to stockholders on or about December 3, 2013. Our Annual Report to Stockholders is enclosed with this proxy statement.

Record Date; Quorum

Only holders of record of “Diamond” common stock as of the close of business on November 22, 2013, the record date, will be entitled to vote at the Annual Meeting. At the close of business on the record date, we had 22,475,123 shares of common stock outstanding and entitled to vote. A majority of the shares outstanding on the record date, present in person or represented by proxy, will constitute a quorum for the transaction of business at the Annual Meeting.

Purpose of the Annual Meeting

You are receiving this proxy statement because the Board is soliciting your proxy to vote your shares at the Annual Meeting. This proxy statement includes information that we are required to provide to you under the rules of the U.S. Securities and Exchange Commission (“SEC”) and is designed to assist you in voting your shares. You will be voting on the following matters at the Annual Meeting:

Recommendation of the Board

Our Board recommends that you vote:

Effect of Abstentions and Broker Discretionary Voting

Shares held by a stockholder who indicates on the proxy card that he or she wishes to abstain from voting will not be taken into account in determining the outcome of the proposal. However, those shares are considered

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present and entitled to vote at the Annual Meeting and will count toward determining whether or not a quorum is present. On routine matters, such as the ratification of the appointment of PricewaterhouseCoopers LLP as the Company’s independent registered public accounting firm, brokers are entitled to vote shares held for beneficial holders without voting instructions from the beneficial holders of those shares. On the other hand, brokers may not be entitled to vote shares held for beneficial holders on non-routine items, such as the election of directors and the Say-on-Pay Vote, absent voting instructions from the beneficial holders of such shares. Consequently, if you do not submit any voting instructions to your broker, your shares will not be voted on these non-routine matters and will not be counted in determining the number of shares necessary for approval of these matters, although they will count for purposes of determining whether a quorum is present.

Voting Rights; Required Vote

Voting of Proxies

Most stockholders have the option of submitting their votes by Internet, telephone or mail. If you have Internet access, you may submit your proxy by following the “Vote by Internet” instructions on the proxy card. If you live in the United States or Canada, you may submit your proxy by following the “Vote by Telephone” instructions on the proxy card. If you complete and properly sign the proxy card you receive and return it to us in the prepaid envelope, your shares will be voted in accordance with the specifications made on the proxy card. If no specification is made on a signed and returned proxy card, the shares represented by the proxy will be voted:

Stockholders who attend the Annual Meeting may vote in person, and any previously submitted votes will be superseded by the vote cast at the Annual Meeting.

Adjournment of Annual Meeting

If the persons present or represented by proxy at the Annual Meeting constitute the holders of less than a majority of the outstanding shares of common stock as of the record date, the meeting may be adjourned to a subsequent date for the purpose of obtaining a quorum.

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Expenses of Soliciting Proxies

We will pay the expenses of assembling proxy materials and soliciting proxies for the Annual Meeting. After the original mailing of the proxy cards and other proxy materials, our directors, officers and employee also may solicit proxies by mail, telephone, facsimile or email, without receiving any additional compensation for such solicitation activities. After the original mailing of the proxy cards and other soliciting materials, we will request that brokers, banks, custodians, nominees and other record holders of our common stock forward copies of the proxy cards and other proxy materials to persons for whom they hold shares and request authority for the exercise of proxies. We will reimburse the record holders for their reasonable expenses if they ask us to do so.

Additional Copy of the Proxy Materials

We will deliver a single copy of the proxy materials to multiple stockholders who share the same address unless we received contrary instructions from one or more of the stockholders. Each stockholder will continue to be able to access and receive separate proxy cards. Upon written request, we will deliver promptly a separate copy of the proxy materials to any stockholder at a shared address to which we delivered a single copy of the proxy materials. To receive a separate copy of the proxy materials, stockholders may write or call us at the following address and phone number:

Investor Relations

Diamond Foods, Inc.

600 Montgomery Street, 13^th Floor

San Francisco, CA 94111

Telephone: (415) 445-7444

Stockholders who hold shares through a broker, bank, trustee or nominee may contact their brokerage firm, bank, broker-dealer, or other similar organization to request additional copy of the proxy materials.

Revocability of Proxies

Any person signing a proxy card in the form accompanying this proxy statement has the power to revoke it at any time before it is voted. Registered holders may revoke a proxy by signing and returning a proxy card with a later date, by delivering a written notice of revocation to Computershare, our transfer agent, at P.O. Box 43078, Providence, Rhode Island 02940-3078, that the proxy is revoked or by attending the Annual Meeting and voting in person. The mere presence at the Annual Meeting of a stockholder who has previously appointed a proxy will not revoke the appointment. Please note, however, that if a stockholder’s shares are held of record by a broker, bank, trustee or other nominee and that stockholder wishes to vote at the Annual Meeting, the stockholder must bring to the Annual Meeting a letter from the broker, bank, trustee or other nominee confirming the stockholder’s beneficial ownership of the shares and that the broker, bank, trustee or other nominee is not voting the shares at the Annual Meeting. In the event of multiple online or telephone votes by a stockholder, each vote will supersede the previous vote and the last vote cast will be deemed to be the final vote of the stockholder unless such vote is revoked in person at the Annual Meeting.

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How to get information

Electronic Delivery of Stockholder Communications

We encourage you to help us conserve natural resources, as well as significantly reduce printing and mailing costs, by signing up to receive your stockholder communications electronically via e-mail. With electronic delivery, you will be notified via e-mail as soon as future Annual Reports and proxy statements are available on the Internet, and you can submit your stockholder votes online. Electronic delivery also can eliminate duplicate mailings and reduce the amount of bulky paper documents you maintain in your personal files. To sign up for electronic delivery:

Registered Owner (you hold our common stock in your own name through our transfer agent, Computershare, or you are in possession of stock certificates): visit www.computershare.com/investor to enroll.

Beneficial Owner (your shares are held by a brokerage firm, a bank, a trustee or a nominee): If you hold shares beneficially, please follow the instructions provided to you by your broker, bank, trustee, or nominee.

Your electronic delivery enrollment will be effective until you cancel it. Stockholders who are record owners of shares of our common stock may call Computershare, our transfer agent, at (800)  733-5001 with questions about electronic delivery.

Corporate Governance at Diamond

We are committed to maintaining high standards of business conduct and corporate governance, which we believe are essential to running our business efficiently, serving our stockholders well and maintaining our integrity in the marketplace. We have adopted a code of conduct and ethics for our directors, officers and employees, known as the Diamond Code of Conduct. Our certificate of incorporation, bylaws, committee charters and Diamond Code of Conduct form our corporate governance framework. In addition, we have committed to maintain a number of practices that we believe are important aspects of our governance structure, including:

The Diamond Code of Conduct and the charters governing the responsibilities and duties of each of the Audit Committee, Compensation Committee and Nominating and Governance Committee are available through the investor relations page at our website: www.diamondfoods.com. We will post on this website the current version of the Diamond Code of Conduct.

Composition of Board of Directors

Our Board currently consists of nine directors. The Board is divided into three classes for purposes of election (i.e., Class I, Class II and Class III), with each class having three members. At each annual meeting of stockholders, the successors to directors whose terms have expired are elected to serve until the third annual meeting following their election.

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Board Independence

We believe that having a Board comprised predominantly of independent directors is critical to the effective governance of Diamond, and we have committed to have no less than 60% of our directors meet applicable independence requirements through September 2016. The Board has determined that each of Mr. Blechschmidt, Ms. Davis, Mr. Hollis, Mr. Rees, Mr. Wilson and Mr. Zollars is an “independent director” under applicable NASDAQ rules, a “non-employee director” as defined in Rule 16b-3 under the Securities Exchange Act of 1934 (“Exchange Act”), and an “outside director” as defined pursuant to Section 162(m) of the Internal Revenue Code of 1986 (“IRC”). The non-independent Board members are Mr. Driscoll, our CEO, and two directors, Mr. Lea and Mr. Tos, who are affiliated with growers from whom we purchase walnuts.

Leadership Structure

The Board periodically considers the appropriate leadership structure for the Company and believes that it is important to retain the flexibility to be able to adjust the leadership structure as circumstances require. In February 2012, the Board decided to have an independent director serve as the Chairman of the Board, and at that time, Mr. Zollars was appointed to that role. In deciding to separate the roles and to have an independent director serve as Chairman, the Board considered Diamond’s corporate governance requirements and anticipated time commitments required from the Board distinct from requirements of the CEO. Mr. Driscoll, our Chief Executive Officer, serves on the Board and is a bridge between management and the Board so that both groups act with a common purpose. The CEO’s membership on the Board enhances his ability to provide insight and direction on important strategic initiatives to both management and the non-employee directors. We believe Mr. Driscoll, our CEO, and Mr. Zollars have an excellent working relationship.

Risk Oversight

Our Board has responsibility, directly and through its committees, for the oversight of risk management, and our officers are responsible for the day-to-day management of the material risks we face. In its oversight role, our Board has the responsibility to satisfy itself that the risk management processes designed and implemented by management are adequate and functioning as designed. The involvement of the Board in setting our annual operating plan and reviewing the key assumptions and strategies proposed by management is a key part of its oversight of risk management, as is its assessment of management’s appetite for risk and its determination of what constitutes an appropriate level of risk for Diamond. The Board regularly receives updates from management and outside advisors regarding certain risks we face, including litigation and various operating risks.

In addition, our Board committees each oversee certain aspects of risk management. For example, our Audit Committee is responsible for overseeing risk management of financial matters, financial reporting, the adequacy of our risk-related internal controls, and internal investigations; our Compensation Committee oversees risks related to compensation policies and practices as well as management succession planning; and our Nominating and Governance Committee oversees governance related risks, such as Board independence, adherence to governance policies and requirements and conflicts of interest.

Senior management attends Board and Board committee meetings at the invitation of the Board or its committees and is available to address any questions or concerns raised by the Board on risk management-related and any other matters. The Board holds strategic planning sessions with senior management periodically to discuss strategies, key challenges, and risks and opportunities for the Company.

Consideration of Director Nominees

Director Qualifications. The goal of the Nominating and Governance Committee is to ensure that the members of our Board have a variety of perspectives and skills derived from high-quality business and professional experience. The Nominating and Governance Committee seeks to achieve a balance of knowledge,

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experience and capability on our Board. To this end, the committee seeks nominees with high professional and personal integrity, an understanding of our business lines and industry, diversity of background and perspective, broad-based business acumen and the ability to think strategically. In addition, the committee considers the level of the candidate’s commitment to active participation as a director, both at Board and committee meetings and otherwise. Although the committee uses these and other criteria to evaluate potential nominees, we have not established a formal diversity policy or any particular minimum criteria for nominees. When appropriate, the committee may retain executive recruitment firms to assist in identifying suitable candidates. After its evaluation of potential nominees, the committee submits nominees to the Board for approval. The committee does not use different standards to evaluate nominees depending on whether they are proposed by our directors and management or by our stockholders.

Stockholder Nominees. The Nominating and Governance Committee will consider stockholder recommendations for director candidates.

Oaktree Designees. In connection with its investment in Diamond, Oaktree Capital Management, L.P. (“Oaktree”) has the right to nominate two members to the Board (“Oaktree Designees”) that qualify as independent directors under applicable NASDAQ rules. No Oaktree Designee may serve as a director or executive officer of a direct competitor of Diamond. Mr. Wilson and Mr. Hollis are currently the Oaktree Designees.

Oaktree’s right to appoint Oaktree Designees terminates upon the first to occur of: (i) such time as Oaktree and its affiliates, collectively, own less than 25% of each of our 12% senior notes and common stock purchase warrants it purchased in May 2012 (ii) Diamond sells all or substantially all of its assets, (iii) Diamond participates in any merger, consolidation or similar transaction following the consummation of which, the stockholders of the Company immediately prior to the consummation of such transaction hold less than 25% of all of the outstanding common stock or other securities entitled to vote for the election of directors of the surviving or resulting entity in such transaction, or (iv) Oaktree irrevocably waives and terminates all of their Board designation rights. Prior to the date Oaktree’s Board designation rights terminate, Diamond has agreed with Oaktree that the Board will not consist of more than 12 members.

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Communication with the Board

You may contact the Board by sending a letter addressed to:

Board of Directors

c/o Corporate Secretary

Diamond Foods, Inc.

600 Montgomery Street, 13^th Floor,

San Francisco, California 94111

An employee will forward these letters directly to the Board, except for spam, junk mail, mass mailings, product complaints or inquiries, job inquiries, surveys, business solicitations or advertisements, or patently offensive or otherwise inappropriate material. We may forward correspondence, such as product-related inquiries, elsewhere within Diamond for review and possible response. We reserve the right not to forward to the Board any abusive, threatening or otherwise inappropriate materials.

Board of Directors

Our Board of Directors has nine members, divided into three classes for purposes of election (i.e., Class I, Class II and Class III). We ask that our stockholders approve Proposal 1, which nominates Ed Blechschmidt, R. Dean Hollis and Robert Zollars as Class III members of the Board. Each of these directors has confirmed that he is willing to serve on the Board if elected. The nominees were evaluated and recommended by the Nominating and Governance Committee in accordance with the process for nominating directors as found below in “Corporate Governance Matters—Board of Directors Meetings and Committees.”

If elected, Class III directors will hold office until 2017 or until their earlier death, resignation or retirement. If a nominee is unavailable for election, proxy holders will vote for another nominee proposed by the board or, as an alternative, the board may reduce the number of directors to be elected at the meeting. Proxies cannot be voted for a greater number of persons than the number of nominees named. If any nominee for any reason is unable to serve or for good cause will not serve, the proxies may be voted for a substitute nominee selected by the proxy holder.

Class III Director Nominees 

Edward A. Blechschmidt is a retired corporate executive. He was Chief Executive Officer of Novelis Corp. from 2006 until its sale to the Birla Group in 2007. Mr. Blechschmidt was Chairman, Chief Executive Officer and President of Gentiva Health Services, Inc., a leading provider of specialty pharmaceutical and home health care services, from 2000 to 2002. From 1999 to 2000, Mr. Blechschmidt served as Chief Executive Officer and a director of Olsten Corporation, the conglomerate from which Gentiva Health Services was split off and taken public. He served as President of Olsten from 1998 to 1999. Mr. Blechschmidt also served as President and Chief Executive Officer of Siemens Nixdorf America and Siemens Pyramid Technologies from 1996 to 1998. Prior to Siemens, he spent more than 20 years with Unisys Corporation, including serving as its Chief Financial Officer. Mr. Blechschmidt serves as a member of the board of directors of Lionbridge Technologies, Inc., VWR International and Columbia Laboratories, Inc. Mr. Blechschmidt also is Chairman of the board of directors of

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Quintig, a private software company. In addition, he served on the board of directors of Healthsouth Corp. from 2004 to 2012. He has a B.S. in Business Administration from Arizona State University. Mr. Blechschmidt brings to the Board his extensive background in executive management, mergers and acquisitions, and his financial and accounting expertise.

R. Dean Hollis is a retired corporate executive. He was President and Chief Operating Officer of the Consumer Foods and International Division of ConAgra Foods, Inc. and served in that role from 2005 to July 2008. Mr. Hollis had management responsibility for ConAgra’s consumer and customer branded businesses consisting of over 40 global brands in 110 countries. During Mr. Hollis’ 21 years with ConAgra, he had a broad array of responsibilities, including Executive Vice President, Retail Products; President, Frozen Foods; President, Grocery Foods; President, Specialty Foods; and President, Gilardi Foods. Currently, Mr. Hollis is a Senior Advisor for Oaktree Capital Management, L.P. He also serves on the board of directors for AdvancePierre Foods, an Oaktree portfolio company, for which he is Chairman of the board of directors, Landec Corporation, for which he chairs the Compensation Committee and Boulder Brands, Inc., for which he serves as the lead independent director and as a member of the Audit Committee. Mr. Hollis is a graduate of Stetson University where he currently serves on the board of trustees. Mr. Hollis is a Board designee for Oaktree Capital Management, which has the right to designate two members to the Board in connection with its investment in Diamond. With over 20 years of experience in the food industry, Mr. Hollis provides the Board with significant expertise in marketing and sales of packaged foods, overall strategy development for food products and in-depth general management expertise for investing in food companies.

Robert J. Zollars has served as Executive Chairman of Vocera Communications, Inc., a provider of instant wireless communications solutions, since July 2013. From 2007 until June 2013, he served as Chairman and Chief Executive Officer of Vocera Communications. From 2006 to 2007, Mr. Zollars was President and Chief Executive Officer of Wound Care Solutions, LLC, a holding company that operates chronic wound care centers in partnership with hospitals in the U.S. From 1999 to 2006, Mr. Zollars was Chairman of the Board of Directors and Chief Executive Officer of Neoforma, Inc., a provider of supply chain management solutions for the healthcare industry. From 1997 to 1999, Mr. Zollars served as Executive Vice President and Group President of Cardinal Health, Inc., a healthcare products and services company. Earlier in his career, while employed at Baxter International, a healthcare products and services company, Mr. Zollars served as President of a dietary products joint venture between Baxter International and Kraft General Foods. Mr. Zollars holds a B.S. from Arizona State University and an M.B.A. from John F. Kennedy University. Mr. Zollars brings to the Board his experience in serving as the chief executive of public companies and running businesses from $100 million to over $5 billion in revenue, and his expertise in general management, corporate strategy, and mergers and acquisitions.

Class I Directors (term to expire in 2015)

Alison Davis is the Managing Partner of Fifth Era, which invests in and incubates early stage companies. She is the former Managing Partner of Belvedere Capital, a private equity firm and regulated bank holding company focused on investments in the financial services sector, where she worked from 2003 to December 2010. From 2000 to 2003, Ms. Davis was the Chief Financial Officer and a member of the Global Management Committee of Barclays Global Investors, an institutional asset manager with $1.5 trillion of assets under management. From 1984 to 2000, Ms. Davis worked as a strategy consultant and advisor to Fortune 500 CEOs, boards and executive teams with A.T. Kearney and McKinsey & Company. Ms. Davis has extensive experience serving on the boards of directors of public companies and currently serves on the boards of the Royal Bank of

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Scotland, Unisys and Xoom Corporation. She also served on the board of City National Bank from June 2010 to July 2011. Ms. Davis received a B.A. degree and M.A. degree in Economics from Cambridge University and an M.B.A. from the Stanford Graduate School of Business. With her experience in global financial services and her roles as a senior executive and as a consultant, Ms. Davis brings valuable expertise in corporate strategy, governance and financial management to our Board and to the Audit and Compensation Committees.

Brian J. Driscoll has served as President and Chief Executive Officer of Diamond and as a member of our Board since May 2012. Prior to joining Diamond, Mr. Driscoll was Chief Executive Officer of Hostess Brands from June 2010 to March 2012, which filed for Chapter 11 bankruptcy protection in January 2012. From 2002 to June 2010, he held senior management positions at Kraft Foods, Inc., including as President, Sales, Customer Service and Logistics, Kraft North America from 2007 to June 2010. Mr. Driscoll joined Kraft Foods, Inc. as a result of Kraft’s acquisition of Nabisco Biscuits and Snacks, where he worked from 1995 to 2002, first as President of Sales and Integrated Logistics and later as the Senior Vice President, Biscuit Sales and Customer Service. Earlier in his career, Mr. Driscoll held sales and sales management positions of increasing responsibility at Nestlé USA and Procter & Gamble Company. Mr. Driscoll holds a B.S. degree from St. John’s University. Mr. Driscoll brings to the Board extensive experience is the food and consumer packaged goods industries as well as a background in general management, sales and logistics.

Nigel A. Rees joined McKesson Corporation, a healthcare services and technology company, in 2001 and he serves as its Vice President and Controller. Prior to joining McKesson Corporation, Mr. Rees was Senior Vice President of Finance from 1998 to 2001 for Adecco, SA, a global staffing and professional services company. From 1995 to 1998, he served as Director of Internal Audit for Tandem Computers, Inc., from 1993 to 1994, he served as the Chief Financial Officer for International Microcomputer Software, Inc., and from 1991 to 1993, he served as Vice President of Finance and Administration for Challenge Dairy Products, Inc. Mr. Rees is a C.P.A. and began his career in public accounting with Deloitte & Touche LLP. He holds an M.B.A. from the University of Washington and a B.A. from Whitman College. Mr. Rees brings to Diamond deep expertise in financial reporting, accounting and compliance.

Class II Directors (term to expire in 2016)

Robert M. Lea served as a member of the board of directors of our predecessor company, Diamond Walnut Growers, from 1993 to 2005. Mr. Lea has practiced law as a solo practitioner with the Law Offices of Robert Lea, since 2004. From 1984 to 2003, Mr. Lea was a partner of the law firm Lea & Arruti. Mr. Lea holds a B.A. from the University of California, Davis and a J.D. from the University of California, Berkeley, School of Law (Boalt Hall). Mr. Lea brings to Diamond extensive legal experience handling complex civil cases, business experience generally, a long-term perspective on Diamond as a result of his service on the board of directors of Diamond Walnut Growers, and his insights on the walnut industry, tree-nut commodity markets and general economic conditions affecting Diamond.

Matthew C. Wilson has been a Managing Director with Oaktree Capital Management, L.P., an investment management firm, since November 2007 and leads the firm’s principal investments in the consumer products, food and beverage and retail sectors. Mr. Wilson worked at H.I.G. Capital, LLC from 2003 to 2007, where Mr. Wilson was a founding member of Bayside Capital, Inc., a fund focused on special situations and credit oriented investments. From 1999 to 2001 he worked at J.H. Whitney & Co in their middle market buyout group. Mr. Wilson began his career in the Investment Banking division of Merrill Lynch & Co., where he worked from 1997 to 1999. He currently serves on the boards of directors of Billabong International Ltd., AdvancePierre

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Foods, for which he chairs the Compensation Committee and serves on the Audit Committee, and The Bridge Direct, Inc. He is also the Chairman of the Board of Trustees of The Children’s Bureau of Los Angeles. Mr. Wilson earned B.A. degrees in Economics and History from the University of Virginia and an M.B.A. from the Harvard Business School. Mr. Wilson is a Board designee for Oaktree Capital Management. Mr. Wilson brings to Diamond transactional and finance expertise as well as investment experience in consumer packaged goods companies.

William L. Tos, Jr., is a third-generation Northern California family farmer, co-owner of Tos Farms, Inc. and Tos Land Co. Inc., and a partner with the Tos Farming Company, a farm management company. Tos Farms harvests peaches, plums, nectarines, cherries, table grapes, corn, alfalfa, walnuts and almonds. Mr. Tos presently serves as an alternate member of the Walnut Marketing Board and the California Walnut Commission. From 1991 to 2005 he served as a director of Diamond Walnut Growers, Inc., the co-operative predecessor to Diamond. Mr. Tos received a B.S. degree from California Polytechnic State University. Mr. Tos brings to Diamond deep experience in agribusiness and the walnut industry, and he has a long-term perspective on Diamond as a result of his service on the board of directors of Diamond Walnut Growers.

Board of Directors Meetings and Committees

Each member of the Board is to attend all regularly scheduled meetings of the Board and any committees on which the director serves, and our annual meeting of stockholders. Each director is expected to attend all special Board and committee meetings to the extent possible. During fiscal 2013, our Board met 26 times. No director attended fewer than 75% of the aggregate of the number of Board and Committee meetings on which the director served during fiscal 2013. All members of the Board attended our 2013 annual meeting of stockholders.

The Board has three standing committees: Audit Committee, Compensation Committee, and Nominating and Corporate Governance Committee. The membership and authority of each committee is described below, and the committee charters are available on our website at www.diamondfoods.com or upon written request to Diamond Foods, Inc., 600 Montgomery Street, 13^th Floor, San Francisco, CA 94111, attention: Investor Relations. All Board committees have the authority and right, at the expense of the Company, to retain legal and other consultants, experts and advisers of its choice to assist the committee in connection with its functions.

Audit Committee

The principal functions of the Audit Committee are:

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The Audit Committee, which met 31 times during fiscal 2013, is currently comprised of Alison Davis, R. Dean Hollis and Nigel Rees, with Mr. Rees serving as Chair of the committee. Mr. Hollis joined the Audit Committee in January 2013, when Mr. Blechschmidt rotated off the committee. The Board has determined that each of our Audit Committee members qualifies as an “audit committee financial expert” as defined by SEC rules. All of the members of the Audit Committee are independent directors under applicable NASDAQ rules.

Compensation Committee 

The principal functions of the Compensation Committee are:

The Compensation Committee, which met eight times during fiscal 2013, is currently comprised of Mr. Zollars, Mr. Blechschmidt and Ms. Davis, with Ms. Davis serving as Chair of the committee. All of the members of the Compensation Committee are independent directors under applicable NASDAQ rules.

In establishing and reviewing our executive compensation arrangements, the Committee considers whether the compensation program encourages unnecessary or excessive risk taking and believes that it does not. The executive compensation program is intended to reflect a balanced approach to compensation and uses both quantitative and qualitative assessments of performance to avoid undue emphasis on any single performance measure.

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The Compensation Committee retained Exequity to advise the Compensation Committee on marketplace trends in executive compensation, management proposals for compensation programs, and executive officer and director compensation decisions. Exequity also evaluates equity and bonus compensation programs generally. Exequity is directly accountable to the Compensation Committee. To maintain the independence of the firm’s advice, Exequity does not provide any services for Diamond other than those described above. In addition, the Compensation Committee conducted a conflict of interest assessment by using the factors applicable to compensation consultants under SEC rules, and no conflict of interest was identified.

Nominating and Governance Committee

The principal functions of the Nominating and Governance Committee are:

The Nominating and Governance Committee, which met once during fiscal 2013, is currently comprised of Mr. Zollars, Mr. Hollis and Mr. Blechschmidt, with Mr. Blechschmidt serving as Chair of the committee. All of the members of the Nominating and Governance Committee are independent directors under applicable NASDAQ rules.

Stock Ownership of Principal Stockholders and Management

The following table presents information regarding the beneficial ownership of our common stock as of November 25, 2013, by each of our directors, each of our executive officers, all of our current directors and executive officers as a group and each stockholder known to us owning more than 5% of our common stock. The percentage of beneficial ownership for the table is based on 22,475,123 shares of our common stock outstanding as of November 25, 2013. To our knowledge, except under community property laws or as otherwise noted, the persons and entities named in the table have sole voting and sole investment power over their shares.

The number of shares beneficially owned by each stockholder is determined under the rules of the SEC and is not necessarily indicative of ownership for any other purpose. Under these rules, beneficial ownership includes those shares over which the stockholder has or shares voting or investment control and includes those shares that the stockholder has the right to acquire within 60 days after November 25, 2013 through the exercise of any stock option. The “Percentage of Common Stock” column treats as outstanding all shares underlying options held by the named stockholder, but not shares underlying options held by other stockholders.

Stock Ownership Guidelines. Under our guidelines, our Board members and executives are required to hold shares as follows:

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Shares that count toward satisfaction of these stock ownership guidelines include:

Executive officers and Board members are expected to comply with these guidelines within three years after being appointed an executive officer or being appointed or elected a member of the Board. As of July 31, 2013, all of our executive officers and Board members were in compliance with our stock ownership guidelines. In addition, pursuant to our insider trading compliance policy, our CEO and CFO are required to pre-clear all trading activity in Diamond securities with our Board Chair or Compensation Committee Chair. Furthermore, our officers and Board members may not purchase Company securities on margin, borrow against any account in which Company securities are held, or pledge Company securities as collateral for a loan without the express written consent of Diamond’s compliance officer, which may be provided in the compliance officer’s discretion.

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Section 16(a) Beneficial Ownership Reporting Compliance

Section 16 of the Exchange Act requires our directors and officers, and persons who own shares representing more than 10% of our common stock, to file initial reports of ownership and reports of changes in ownership with the Securities and Exchange Commission. The SEC regulations also require these persons to furnish us with a copy of all Section 16(a) forms they file. Based solely on our review of the copies of the forms furnished to us and written representations from our executive officers and directors, we believe that all Section 16(a) filing requirements were met during fiscal 2013.

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Diamond Executive Officers

The following individuals are our executive officers:

Brian J. Driscoll has served as President and Chief Executive Officer of Diamond and as a member of our Board since May 2012. Prior to joining Diamond, Mr. Driscoll was Chief Executive Officer of Hostess Brands from June 2010 to March 2012, which filed for Chapter 11 bankruptcy protection in January 2012. From 2002 to June 2010, he held senior management positions at Kraft Foods, Inc., including as President, Sales, Customer Service and Logistics, Kraft North America from 2007 to June 2010. Mr. Driscoll joined Kraft Foods, Inc. as a result of Kraft’s acquisition of Nabisco Biscuits and Snacks, where he worked from 1995 to 2002, first as President of Sales and Integrated Logistics and later as the Senior Vice President, Biscuit Sales and Customer Service. Earlier in his career, Mr. Driscoll held sales and sales management positions of increasing responsibility at Nestlé USA and Procter & Gamble Company. Mr. Driscoll holds a B.S. degree from St. John’s University.

Raymond P. Silcock has served as our Executive Vice President and Chief Financial Officer since June 2013. Prior to joining Diamond, Mr. Silcock was Senior Vice President & Chief Financial Officer of the Great Atlantic & Pacific Tea Company (A&P) from its emergence from bankruptcy in March 2012 until February 2013 and previously was the Head of Finance from December 2011 to March 2012. He was an independent management consultant with clients including A&P and Palm Ventures LLC from December 2009 to December 2011 and from September 2009 to December 2009 was Executive Vice President & Chief Financial Officer of KB Home. Prior to that Mr. Silcock served as Senior Vice President & Chief Financial Officer of UST Inc. from July 2007 to April 2009 when it was acquired by Altria. Before joining UST he was Executive Vice President and Chief Financial Officer of Swift and Company from 2006 to 2007 when the company was sold. Prior to that he was Executive Vice President & Chief Financial Officer of Cott Corporation from 1998 until 2005, where he oversaw the restructuring and turnaround of that business. Earlier in his career, Mr. Silcock held a variety of progressively more responsible roles at Campbell Soup Company where he worked from 1979-1997. Mr. Silcock is a member of the Board of Directors of Pinnacle Foods Corporation. He holds an M.B.A. from the Wharton School of the University of Pennsylvania and is a Fellow of the Chartered Institute of Cost & Management Accountants (UK).

Lloyd J. Johnson has served as our Executive Vice President and Chief Sales Officer since September 2008. From 2005 until August 2008, Mr. Johnson was a Senior Vice President for Expedia Inc., an online travel service company, during which time he managed various divisions within the Partner Services Group. Prior to joining Expedia, Mr. Johnson was employed at Kraft Foods, Inc., a food company, where he was Vice President, Sales and Customer Development, Kraft Canada from January 2005 to June 2005, and Customer Vice President, Kroger, from 2001 to 2004. Earlier in his career, Mr. Johnson held a variety of sales and sales management positions of increasing responsibility at Nabisco Biscuit Company and Ernest & Julio Gallo Winery. Mr. Johnson holds a B.A. from Eastern Washington University.

David J. Colo has served as Executive Vice President, Chief Operating Officer of Diamond since June 2013. From December 2012 until June 2013, Mr. Colo was our Executive Vice President, Global Operations and Supply Chain. From August 2009 to December 2012, Mr. Colo served as an independent industry consultant working on organizational optimization and strategic planning. From April 2005 through July 2009, Mr. Colo held leadership positions in ConAgra Foods, Inc.’s Consumer Products division, including as the Senior Vice

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President Operations (January 2007 to July 2009), Senior Vice President Enterprise Manufacturing (May 2006 to December 2006) and Senior Vice President Sales and Operations Planning (April 2005 to April 2006). From January 2003 to March 2005, Mr. Colo worked in ConAgra Foods’s Commercial Production division, with his last position in such division as President, ConAgra Food Ingredients. Earlier in his career, Mr. Colo held positions of increasing responsibility at Nestle-Purina, where he worked from 1986 to 2002. Mr. Colo holds a B.S. from Southern Illinois University.

Linda B. Segre has served as Senior Vice President, Corporate Strategy and Human Resources since October 2012. From August 2009 to October 2012, Ms. Segre served as Senior Vice President, Corporate Strategy. From 2006 until April 2009, Ms. Segre was a Managing Director at Google.org, the corporate philanthropy organization of Google Inc., where she oversaw the climate change and global development initiatives and managed all operational aspects of the organization. From 1995 until 2006, Ms. Segre was Vice President, Officer and Director at The Boston Consulting Group, a global management consulting firm, and served as the Managing Director of the San Francisco office from 2001 until 2005. She first joined The Boston Consulting Group in 1987 and worked in a number of roles with increasing responsibilities until she became a Vice President in 1995. During her tenure at Boston Consulting Group, she focused on serving clients in the consumer goods and financial services sectors. From 1981 until 1985, Ms. Segre was a touring golf professional in the United States, Europe and Asia. Ms. Segre holds a B.A. from Stanford University and an M.B.A. from the Stanford Graduate School of Business.

Stephen E. Kim has served as our Senior Vice President, General Counsel since January 2010. From January 2008 until January 2010, Mr. Kim was Vice President, General Counsel, and Human Resources, and from March 2005 to January 2008, he served as our Vice President, General Counsel. Previously, Mr. Kim served as General Counsel for Oblix, Inc., a software company in Cupertino, California, from 2000 to March 2005. Before joining Oblix, Inc., Mr. Kim was an attorney with Wilson, Sonsini, Goodrich and Rosati, a law firm located in Palo Alto, California, from 1996 to 1999 and Weil Gotshal & Manages, a law firm located in New York, New York, from 1994 to 1996. Mr. Kim holds a B.A. from Johns Hopkins University and a J.D. from New York University School of Law.

Compensation Discussion and Analysis

Introduction

In this Compensation Discussion and Analysis (“CD&A”), we explain and analyze the material elements of the fiscal 2013 compensation arrangements for the individuals who served as our named executive officers during the year. The purpose of this discussion is to provide the context for the presentation of the specific compensation paid to our named executive officers, as shown in the tables and narrative disclosure that follow. During fiscal 2013, our named executive officers were:

In addition, during fiscal 2013, two of our former officers were named executive officers:

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In this CD&A, we refer to non-GAAP financial measures that were used as performance metrics for our executive compensation. Please refer to Appendix A for a reconciliation of these non-GAAP financial measures to the most directly comparable financial measures prepared in accordance with accounting principles generally accepted in the United States (“GAAP”).

This CD&A is organized into six sections:

Our Compensation Philosophy

The objective of our executive compensation program is to attract, retain and motivate executives of exceptional ability who have the capability to provide strong leadership for Diamond and increase stockholder value. To that end, our executive compensation is designed to be competitive within our industry, taking into account performance and scope of responsibility, and to have a significant portion of each named executive officer’s total compensation “at-risk” through both near-term and long-term incentive compensation arrangements. We design these incentives to reward increases in stockholder value, accomplishment of corporate strategic objectives and accomplishment of individual goals.

Our philosophy is to analyze base salaries in the context of the median of the peer group benchmarks, with consideration given to each individual’s historical compensation, skill set, performance, tenure, internal pay relationship to other executives and importance to the organization. At the beginning of fiscal 2013, our philosophy was to analyze equity awards in the context of the 50^th to 75^th percentile of the applicable peer group to incent our executives to achieve the objectives we set for Diamond. During fiscal 2013, we revised our approach to assess equity grants in the context of the median of the peer group, with consideration still to be given the same factors that could impact base salary decisions. The change in philosophy on equity pay practices was intended to reflect the Committee’s view that all elements of compensation, including equity, should be structurally in line with the relevant industry standards, with flexibility to recognize strong company and individual performance. With respect to cash incentives, our philosophy is to set target bonus amounts as a percentage of base salary in the context of the median of the peer group benchmarks, and to provide our executives significant upside opportunity for strong performance as incentive to achieve the strategic initiatives in support of our growth targets. Market pay information for the peer group is one of the many factors considered in determining individual executive officer compensation levels in addition to tenure, performance, organizational impact and internal equity with other executives.

Executive Summary of Fiscal 2013 Compensation Matters

Fiscal 2013 was the first full year of a multi-year turnaround for Diamond. We exceeded our targets for gross profit and adjusted EBITDA, settled several material litigation matters, established new corporate governance practices, remediated a number of internal control material weaknesses, executed on cost savings initiatives, focused on net price realization for our products and reinvested in building our brands. This performance was reflected in executive compensation in line with our compensation policies.

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Compensation Decision Processes

Role of the Compensation Committee. The Compensation Committee (which we refer to in this section as the “Committee”) of our Board makes all decisions about compensation of our named executive officers other than our Chief Executive Officer. For decisions affecting the compensation of the Chief Executive Officer, the Board makes the ultimate compensation decision, taking into account the Committee’s recommendations.

Role of Independent Consultant. We believe that utilizing an independent compensation consultant is important in developing executive compensation programs that are reasonable and consistent with our objectives. Beginning in fiscal 2012, the Committee retained Exequity to serve as a third-party compensation consultant to assist in evaluating executive compensation programs and amounts of executive and director compensation. Exequity advised the Committee on the following during fiscal 2013:

In the course of fulfilling these responsibilities, a representative of Exequity attended Committee meetings and met with management from time to time to gather relevant information. The Committee’s executive compensation decisions, including the specific amounts paid to our executive officers, are made through the

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exercise of its own judgment and may reflect factors and considerations other than the information and recommendations provided by Exequity, including role and organizational impact, internal pay relationships and experience, tenure and sustained performance over time. Exequity has not provided any other services to us and has received no compensation other than with respect to the services described above.

Benchmark Data. At the beginning of fiscal 2013, Exequity developed benchmarks for compensation of the named executive officers from U.S. public companies in the food manufacturing and consumer products industries with revenues of approximately $520 million to $2.9 billion, which resulted in a peer group of twelve companies with median annual revenue of $1.5 billion. For fiscal 2013, our total revenue was $864 million. While Diamond’s total revenue fell below the median of the peer group, there are a the limited number of branded, public food and beverage companies similar enough to Diamond’s profile to serve as meaningful comparables, and as a result, we believe the peer group recommended by Exequity provided a sufficient basis in analyzing compensation for our named executive officers.

Our fiscal 2013 peer group and trailing twelve month revenue, as such information was provided by Exequity, was as follows:

In addition to the peer group information, Exequity analyzed information from the Towers Watson Executive Compensation Survey using companies with revenue of less than $3 billion. To evaluate compensation levels for the CEO and CFO, those positions were matched to the comparable position in the peer group, with additional analytical support from the Towers Watson Survey data. With respect to the other named executive officers, we primarily used the Towers Watson survey given the limited number of proxy position matches in the peer group.

Role of the Chief Executive Officer. Our CEO, in consultation with each named executive officer, develops individual goal achievement plans that serve as the basis for the determination of annual bonuses under our annual incentive plan. After completion of the fiscal year, the CEO reviews executive officer performance relative to individual goals and makes recommendations to the Committee about the officer’s bonus achievement. Based on the analysis conducted by Exequity, the CEO also makes recommendations regarding possible increases in base salary. The Committee reviews the CEO’s recommendations for executives other than the CEO and makes determinations regarding bonus payments and base salary.

Components of Executive Compensation

The material elements of compensation for our named executive officers are base salaries, bonuses and equity incentives. Named executive officers also receive perquisites, termination benefits and participate in other employee benefit programs. In addition, in connection with their offer letters entered into when they joined Diamond, Mr. Silcock and Mr. Colo received a relocation payment.

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Base Salary. Base salary establishes the minimum compensation levels for our executive officers. Salary increases can be awarded in recognition of superior performance, organizational advancement and increasing levels of responsibility. Base salaries for our named executive officers are based on the Committee’s subjective determination of appropriate salary levels, taking into consideration peer group and survey information, the Chief Executive Officer’s recommendations (for named executive officers other than himself), the individual executive officer’s role in the organization, his or her performance during the prior fiscal year, and the individual’s skill set relative to business needs.

Annual Cash Incentives. Bonus compensation helps us to attract and retain executive talent and to motivate our team to pursue strategic objectives by creating opportunities for additional compensation on an annual basis contingent on performance results. Annual cash incentives are intended to promote the achievement of our annual corporate financial goals, other corporate initiatives and individual goals under programs administered by the Committee.

In November 2012, the Board approved changes to our bonus plan, which we refer to as the annual incentive plan for all eligible employees, including executive officers. Under the annual incentive plan, eligible employees are assigned a target bonus (“Target Bonus”) and a maximum bonus (“Maximum Bonus”), each consisting of a specified percentage of the employee’s base salary. Actual bonuses paid depend upon both the level at which the annual incentive plan is funded for a particular year, which is determined by our performance, and the individual performance of each participant. The Committee selects one or more corporate financial objectives (“AIP Metrics”) and establishes the threshold, target and maximum levels of our performance with respect to those metrics that will apply to the annual incentive plan for that fiscal year. The AIP Metrics may be any one or more company-wide financial metrics, including without limitation revenue, gross margin, gross profit, operating margin, operating profit, earnings growth, EBITDA, and any per-share or non-GAAP calculations of any such metrics, as determined in the sole discretion of the Committee. The annual incentive plan will fund as follows:

The objectives against which an eligible employee may be measured may include, without limitation, corporate goals (such as revenue, gross margin, gross profit, operating margin, earnings growth, earnings per share, and non-GAAP calculations of any such metrics), departmental goals (such as category business team or functional goals relating to accomplishment of strategic initiatives, brand or category financial performance, market share, revenue, profitability, cost efficiency, products, brand equity, human capital or other goals) or individual goals as determined in conjunction with the eligible employee’s manager.

Bonus award potential is based on both corporate financial objectives, representing 60% of incentive potential, and individual objectives, representing 40% of incentive potential. Corporate and individual

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components of the award are not mutually dependent, and bonuses are capped at 200% of target. Target cash incentives for our named executive officers, as a percent of base salary, is linked to level in the organization. In fiscal 2013, target cash incentives were set at the following percentages of base salary:

Equity Incentives. The Committee believes that equity awards are a key component of our executive compensation program because they help us attract, motivate and retain executive talent. Our 2005 Equity Incentive Plan enables us to grant stock options, stock appreciation rights, restricted stock, restricted stock units and other equity awards, and to subject those awards to vesting to promote a long-term perspective. The Committee believes that equity-based incentives help to align the interests of our executives with those of other stockholders by making a portion of the executive’s compensation and net worth dependent upon the performance of our common stock. The grant of stock options and restricted stock creates general corporate performance incentives that are dependent on stock price performance, as stock options only have value if our stock price increases above the original grant price and restricted stock have a value that may go up or down consistent with the stock value. These incentive grants are designed to reward long term sustained share price growth.

The Committee and Board make equity awards to named executive officers annually and may make additional equity awards for recruiting, retention or other purposes. The process we employ is as follows:

The Committee makes annual grants either at in-person meetings or by unanimous written consent, with the stock option exercise price equal to the closing price of our common stock on the date of the meeting or the date on which all of the written consents were signed. From time to time, the Committee has acted by unanimous written consent to approve new hire option grants for newly-hired officers, in which case the Committee’s practice has been to set the stock option exercise price equal to the closing price of our common stock on the date all written consents have been signed or the date of commencement of employment, if later.

Retirement Plans. Our named executive officers participate in the same 401(k) plan on the same terms provided to all administrative employees. We make a contribution of 3% of base salary into 401(k) accounts, up to a maximum of $7,650 per year.

Perquisites. We provide executive officers with perquisites and other personal benefits, such as payment of standard life and health insurance premiums, which we believe are consistent with our overall compensation program. The Committee periodically reviews the types of perquisites and other personal benefits provided to named executive officers, and does not consider perquisites a significant element of our executive compensation arrangements. Diamond does not provide tax gross up reimbursements for any perquisites.

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Retention Program. On February 18, 2012, Diamond established a Key Executive Retention Plan (“Plan”) to help ensure leadership stability, under which participating executives received a benefit equal to a percentage of their annual base salary, one-half of which was payable in cash and one-half of which will be paid in the form of restricted stock. Forty percent of the retention benefit was paid on August 23, 2012 and the remainder of the retention benefit was paid on February 23, 2013. The Committee selected Mr. Johnson, Mr. Burke, Mr. Kim and Ms. Segre as participants in the Plan, each with a total retention benefit equal to 250% of his or her current annual base salary in effect in February 2012.

Compensation Decisions for Fiscal 2013

Bonus Plan Funding

Under our annual incentive plan, a bonus pool for employees, including named executive offices, is funded to the extent the company achieves pre-determined financial metrics. For fiscal 2013, half the bonus pool was to be funded based on achievement against adjusted EBITDA targets and the other half of the bonus pool was a function of gross profit targets. No adjusted EBITDA bonus pool funding would occur unless a threshold of 90% of the adjusted EBITDA target was achieved and no gross profit bonus pool funding would occur unless a threshold of 90% of the gross profit target was achieved. The threshold, target and maximum funding targets for fiscal 2013 were as follows, and the result is interpolated in a straight line between Threshold and Target and in another straight line between Target and Maximum:

Adjusted EBITDA

Gross Profit

In fiscal 2013, Diamond reported $101.7 million in adjusted EBITDA and $205.5 million in gross profit. Taking this performance into account, the Committee approved funding of the annual incentive plan at 130.1% of target. For the year, the bonus potential for all of our named executive officers, including Mr. Driscoll, under the annual incentive plan was based on two factors—achievement of the same adjusted EBITDA and gross profit metrics used for bonus plan funding and accomplishment against personal objectives. The financial metric, component represented 60% of the bonus potential and personal objectives accounted for 40% of bonus potential.

Chief Executive Officer

Base Salary. In connection with his appointment as our President and CEO, Diamond entered into an employment agreement with Mr. Driscoll in May 2012, with an initial term of three years, pursuant to which we agreed to pay him a base salary of $825,000. For fiscal 2013, Mr. Driscoll’s base salary remained at $825,000.

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Bonus. For fiscal 2013, Mr. Driscoll’s bonus was calculated as follows:

As a result, Mr. Driscoll received a bonus for fiscal 2013 as follows:

Equity Grant. During fiscal 2013, we issued to Mr. Driscoll equity having a grant date fair value of approximately $5 million in accordance with his employment agreement entered into when he joined Diamond in May 2012. Mr. Driscoll received an initial grant having a grant date fair value of $3 million, with half in the form of stock options and half in restricted stock as an inducement to join the company. Pursuant to his agreement, the new hire grant was to be made following completion Diamond restatement of financial results for fiscal 2010 and 2011. Accordingly, the new hire grant was made in November 2012, after Mr. Driscoll joined the Company and after the completion of the fiscal year.

In addition, Mr. Driscoll’s employment agreement provided for an equity award for fiscal 2013 with a grant date fair value worth $2 million. In accordance with the agreement, in December 2012, the Board granted Mr. Driscoll restricted stock having a grant date fair value of $1,000,000 and an option having a grant date full value of $1 million. The restricted stock took the form of two different awards. The first restricted stock grant, having a value of $333,000, is subject to a four-year vesting schedule with 25% of the shares vesting on each anniversary of the date of grant. The second grant, having a value of $667,000, is subject to a four-year cliff vest schedule with 100% of the shares vesting on the fourth anniversary of the date of grant. However, the grant may vest earlier upon the Board’s determination that adjusted EBITDA performance exceeded targets after two or

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three years, and provided that Mr. Driscoll remains in continuous service as an employee or consultant through such date. The Compensation Committee believed that the four-year cliff vesting aspect of the grants were appropriate to help retain the executive team while still incenting performance through the possible acceleration of vesting as the company reached its goals. To date, no accelerated vesting of these grants has occurred.

Interim CFO

Mr. Murphy served as our interim Chief Financial Officer during fiscal 2013 until June 2013, pursuant to an engagement letter entered into between us and an affiliate of Alix Partners, in which we agreed to pay Alix Partners $100,000 per month for Mr. Murphy’s services. We also paid Alix Partners for the services of other of its employees who assisted Diamond on a time-billed basis. Mr. Murphy was not eligible for any bonus or equity awards.

Other Named Executive Officers

Base salary and bonus potential.

The base salaries and bonus potential for Mr. Colo and Mr. Silcock, who joined during fiscal 2013, were specified in their offer letters with Diamond. Mr. Colo’s annual salary was established at $400,000 when he joined in December 2012 and Mr. Silcock’s salary was set at $525,000 when he joined in June 2013. Exequity advised the Committee as to both salaries, based on market comparables, experience of both individuals and the need to recruit for both positions. In June 2013, Mr. Colo was promoted to Chief Operating Officer, at which time his base salary was increased to $450,000. Exequity also advised the Committee regarding this increase. As executive vice presidents, both Mr. Colo and Mr. Silcock have a target bonus potential of 70% of base salary and a maximum of 140%.

In December 2012, the Committee approved increases in the base salaries of Mr. Burke, Mr. Kim and Ms. Segre, based on salary information at comparable companies and survey data provided by Exequity. The new salaries were $350,000 for Mr. Burke and $325,000 for each of Mr. Kim and Ms. Segre. In addition, the bonus potential for Mr. Kim and Ms. Segre increased to 55% of base salary at target (up from 50%) and 110% of base salary at maximum (up from 100%).

Fiscal 2013 Bonus Payments

As noted above in “Compensation Decisions for Fiscal 2013—Chief Executive Officer,” the Committee approved 130.1% of the financial metric target bonus level. In accordance with our annual incentive plan, individuals are assigned an individual performance rating, which can impact the amount of the financial metric bonus and personal objective bonus received. For our named executive officers, the financial metric bonus represents 60% of their bonus potential. The amount attributable to the financial metric bonus and the personal goal bonus, which represent the other 40% of bonus potential, is as follows:

Mr. Silcock: Mr. Silcock received a financial metric bonus of $40,083, which represented 130.1% of the targeted amount pro-rated for the portion of the fiscal year in which Mr. Silcock was employed at Diamond. He also received $22,594 of bonus based on personal objectives, which represented 110% of his targeted amount on a pro rated basis. In his offer letter, Mr. Silcock was guaranteed at least a target level of bonus for fiscal 2013 on a pro rated basis.

Mr. Colo: Mr. Colo received a financial metric bonus of $148,207, which represented 130.1% of the targeted amount pro-rated for the portion of the fiscal year in which he was employed at Diamond. He also received $91,134 of bonus based on personal objectives, which represented 120% of his targeted amount on a pro rated basis, based on accomplishments relating to designing an integrated operations and supply chain organizations, executing cost savings initiatives, work on optimizing systems supporting distribution network and implementing programs for walnut supply and walnut-related manufacturing capacity.

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Mr. Johnson: Mr. Johnson received a financial metric bonus of $233,061, which represented 130.1% of the targeted amount. He also received $179,140 of bonus based on personal objectives, which represented 150% of his targeted amount based on accomplishments relating to meeting gross sales, trade spend and SG&A objectives, implementing Kettle distribution plans and implementing route-to-market programs.

Ms. Segre: Ms. Segre received a financial metric bonus of $128,515, which represented 130.1% of the targeted amount. She also received $79,025 of bonus based on personal objectives, which represented 120% of her targeted amount based on accomplishments relating to driving project management office projects to deliver on cost savings initiatives, completing investor relations initiatives and recruiting senior-level executives and implementing new human resources programs.

Mr. Kim: Mr. Kim received a financial metric bonus of $128,515, which represented 130.1% of the targeted amount. He also received $79,025 of bonus based on personal objectives, which represented 120% of his targeted amount based on accomplishments relating implementing contract protocols and management database, remediation of reported material weaknesses, enhancing disclosure processes, legal cost saving initiatives and managing litigation.

Mr. Burke: Mr. Burke, who left the company in August 2013, received a financial metric bonus of $90,458, which represented 59% of the targeted amount and reflects his individual rating. He also received $46,353 of bonus based on personal objectives, which represented 50% of his targeted amount based on organizational design objectives, including category business team structure, innovation resources and capabilities and commercial effectiveness programs and product innovation and brand strategies, including new products and packaging, consumer positioning and household penetration plans.

Equity Awards. During fiscal 2013, the Committee approved equity grants for the named executive officers as follows:

The Committee approved these grants, which had an aggregate value in excess of the 75^th percentile for equity awards in Diamond’s peer group survey data for fiscal 2013, based on each individual’s contributions over their tenure with Diamond, the importance of their positions and the effort required to execute on the company’s turnaround efforts. Two-thirds of the restricted shares took the form of performance-accelerated restricted stock and the remaining one-third took the form of time-based vesting stock. The Committee believed that awarding half of the total grant date value of equity awards in the form of stock options and half in the form of restricted stock provided an appropriate mix of performance incentive and long-term retention.

Tax and Accounting Considerations

In evaluating potential compensation alternatives, the Compensation Committee considers the possible impact of Section 162(m) of the Internal Revenue Code of 1986, as amended (the “Code”). Section 162(m) of the Code places a limit of $1 million on the amount of compensation that we may deduct as a business expense in

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any year with respect to certain of our most highly paid executive officers unless, among other things, such compensation is performance-based and has been approved by stockholders. Generally, we have not designed our restricted stock grants and annual incentive plan to be eligible for deductibility to the extent permitted by Section 162(m) of the Code. Accordingly, a portion of the compensation to our named executive officers or covered employees may not be deductible.

Accounting considerations also play an important role in the design of our executive compensation program. Accounting rules require us to expense the grant date fair values of our equity awards. Because of this stock-based expensing and the impact of dilution to our stockholders, we closely monitor the number and the fair values of the stock options that are granted each year.

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Report of the Compensation Committee

The Compensation Committee has reviewed and discussed the Compensation Discussion and Analysis with management. Based on such review and discussions, the Compensation Committee recommended to the Board that the Compensation Discussion and Analysis be included in this Proxy Statement.

COMPENSATION COMMITTEE

Alison Davis, Chair

Edward A. Blechschmidt

Robert J. Zollars

Executive Compensation

Summary of Executive Compensation

The following table presents the annual compensation of our named executive officers. We also provide benefits to our executive officers that are generally available to all of our employees.

Summary Compensation Table

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2013 Grants of Plan-Based Awards