BH - Biglari Holdings

[accutronman]

Another good quarter for Sardar especially on realized investment gains.

 

 

 

 

[CassiusKing1]

Looks like the franchising is finally coming into fruition and will make a impact.

[racemize]

Looks like the franchising is finally coming into fruition and will make a impact.

 

do you have a source or was there an announcement that I missed?

[CassiusKing1]

Looks like the franchising is finally coming into fruition and will make a impact.

 

do you have a source or was there an announcement that I missed?

Just in reading Sardar's letter.  He stated that the first Signature store will open in NYC on the 12th.  They have commitments for another 110 units from franchisee's.

[dcollon]

Cracker Barrel Old Country Store, Inc. Adopts Shareholder Rights Plan with 20% Threshold and Qualifying Offer Exception

Tuesday, April 10, 2012 07:00:00 AM

 

 

The Board of Directors of Cracker Barrel Old Country Store, Inc., yesterday adopted a shareholder rights plan with a 20% triggering threshold and a qualifying offer exception and declared a dividend distribution of one preferred share purchase right on each outstanding share of Cracker Barrel common stock. The plan does not apply to all-cash, fully financed tender offers open for at least 60 business days and will terminate unless approved by shareholders at the company’s 2012 annual meeting.

 

Sandra B. Cochran, President and Chief Executive Officer of Cracker Barrel Old Country Store, Inc., stated, “The Board’s action is in response to Biglari Holdings’ continuing open-market acquisition program of Cracker Barrel shares, which has brought current ownership to over 16% and the resulting possibility that Biglari Holdings could accumulate an even more substantial and potentially controlling position in Cracker Barrel through market purchases that do not reflect a control premium offered to all shareholders. Biglari Holdings previously sought and received clearance in September 2011 under the Hart-Scott-Rodino Act to acquire up to 49.99% of Cracker Barrel's common stock. We intend to put this rights plan to a vote of our shareholders at our 2012 shareholder meeting and believe it is important to protect the interests of our shareholders in the near-term.

 

“Unlike the rights plan that Cracker Barrel adopted in September 2011 with a 10% triggering threshold, and which expired after Cracker Barrel shareholders voted against the plan at the 2011 annual meeting, this new rights plan has a 20% triggering threshold that is fully consistent with the guidelines of Institutional Shareholder Services and that we believe contains the attributes looked for by most leading institutional investors. The shareholder rights plan is designed to assure that all of Cracker Barrel’s shareholders receive fair and equal treatment in the event of any proposed takeover of the Company and to guard against any attempt to gain control of Cracker Barrel without paying all shareholders a premium for that control.”

 

If a person or group acquires 20% or more of Cracker Barrel’s outstanding common stock, each right will entitle its holder (other than such person or members of such group) to purchase, for $200, a number of Cracker Barrel’s common shares having a market value of twice such price. In addition, at any time after a person or group acquires 20% or more of Cracker Barrel’s outstanding common stock (unless such person or group acquires 50% or more), Cracker Barrel’s Board of Directors may exchange one share of Cracker Barrel common stock for each outstanding right (other than rights owned by such person or group, which would have become void).

 

The rights would not interfere with all-cash, fully financed tender offers for all shares that remain open for a minimum of 60 business days (“qualifying offers”).

 

The rights plan is effective immediately and, if approved by shareholders, will expire on April 9, 2015. If shareholders do not approve the rights plan, it will expire upon certification of the vote at the 2012 annual shareholders’ meeting.

 

Prior to the acquisition by a person or group of beneficial ownership of 20% or more of the Company’s common stock, the rights are redeemable for one cent per right at the option of the Board of Directors.

 

Certain synthetic interests in securities created by derivative positions - whether or not such interests are considered to constitute beneficial ownership of the underlying common stock for reporting purposes under Regulation 13D of the Securities Exchange Act - are treated as beneficial ownership of the number of shares of the company’s common stock equivalent to the economic exposure created by the derivative position, to the extent actual shares of the company’s stock are directly or indirectly held by counterparties to the derivatives contracts. The dividend distribution will be made on April 20, 2012, payable to shareholders of record on that date, and is not taxable to Cracker Barrel shareholders.

 

 

[augustabound]

Found this kind of funny. 

https://twitter.com/#!/SardarBigliar

 

(To those who don't have Twitter, this isn't actually him, it's a phantom account.  Hence the "i" in the wrong spot in his last name.)  :D

[stahleyp]

When did he take over Steak n Shake?

[dcollon]

From 8-k:

 

On April 19, 2012, Biglari Holdings Inc. (the “Company”) will disclose at its 2012 Annual Meeting of Shareholders that same-store sales and customer traffic of its wholly-owned subsidiary, Steak n Shake Operations, Inc., increased by 4.8% and 5.2%, respectively, during the sixteen weeks ended April 11, 2012.

 

[dcollon]

And the letter (attached) from Sardar to CBRL

BH_Letter.pdf

[bargainman]

And the letter (attached) from Sardar to CBRL

 

Interesting:

 

"We want shareholders who share our owner mentality to support us; only then can we be positioned to implement triumphant, value-maximizing ideas. I pledge in return that Biglari Holdings will not sell a single share of Cracker Barrel stock. If we should decide to do so — again, we have no such plans — we would first issue a press release to notify all shareholders quite far in advance (i.e., minimum of two weeks). In other words, we will not take advantage of you."

[rmitz]

[interesting:

 

"We want shareholders who share our owner mentality to support us; only then can we be positioned to implement triumphant, value-maximizing ideas. I pledge in return that Biglari Holdings will not sell a single share of Cracker Barrel stock. If we should decide to do so — again, we have no such plans — we would first issue a press release to notify all shareholders quite far in advance (i.e., minimum of two weeks). In other words, we will not take advantage of you."

 

The fact that he had to say that says volumes, doesn't it?

[Junto]

[interesting:

 

"We want shareholders who share our owner mentality to support us; only then can we be positioned to implement triumphant, value-maximizing ideas. I pledge in return that Biglari Holdings will not sell a single share of Cracker Barrel stock. If we should decide to do so — again, we have no such plans — we would first issue a press release to notify all shareholders quite far in advance (i.e., minimum of two weeks). In other words, we will not take advantage of you."

 

The fact that he had to say that says volumes, doesn't it?

 

Now you know he wants to take control similar to SNS. No debate after that letter. I find it is more profitable to be an investor in the target of Biglari than the BH itself. I have no skin in this game but been watching it develop. Fun reading either way.

[dcollon]

Was this Sardar and his family on the way home from the annual meeting?  ;) I couldn't resist.

 

"New Jersey removed two state troopers from active duty amid investigations into a high-speed caravan of Porsches, Lamborghinis and Ferraris led by police cruisers on the Garden State Parkway"

 

http://www.bloomberg.com/news/2012-04-24/n-j-suspends-two-state-troopers-amid-death-race-probes.html

 

 

[bookie71]

latest quarter

http://finance.yahoo.com/news/biglari-holdings-inc-news-release-204000558.html

[Kuhndan]

Sardar is at it again, requesting two Board seats on Cracker Barrel's Board. Excerpt from todays SEC filing:

 

On August 16, 2012, BH delivered a letter to the Secretary of the Issuer nominating Sardar Biglari and Philip L. Cooley to stand for election to the Board of Directors of the Issuer (the “Board”) at its 2012 annual meeting of stockholders (the “2012 Annual Meeting”).  The Reporting Persons have had and will continue to have discussions with the Issuer about representation on the Board.  The Reporting Persons continue to believe that the Board requires directors who have a meaningful ownership interest in the Issuer as well as highly consequential industry experience.  The Reporting Persons are committed to seeking such representation for the benefit of all shareholders without the need for a costly proxy contest. As a consequence, the Reporting Persons have communicated to the Issuer’s CEO and recently designated Independent Chairman their desire for two Board seats, their interest to work constructively with the Board, and their interest in avoiding a costly proxy contest. The Reporting Persons are awaiting the Issuer’s response and maintain that all shareholders’ best interests lie in a favorable outcome.

 

My bet is that he gets his seats. He's always interesting to watch.

[bargainman]

Sardar is at it again, requesting two Board seats on Cracker Barrel's Board. Excerpt from todays SEC filing:

 

On August 16, 2012, BH delivered a letter to the Secretary of the Issuer nominating Sardar Biglari and Philip L. Cooley to stand for election to the Board of Directors of the Issuer (the “Board”) at its 2012 annual meeting of stockholders (the “2012 Annual Meeting”).  The Reporting Persons have had and will continue to have discussions with the Issuer about representation on the Board.  The Reporting Persons continue to believe that the Board requires directors who have a meaningful ownership interest in the Issuer as well as highly consequential industry experience.  The Reporting Persons are committed to seeking such representation for the benefit of all shareholders without the need for a costly proxy contest. As a consequence, the Reporting Persons have communicated to the Issuer’s CEO and recently designated Independent Chairman their desire for two Board seats, their interest to work constructively with the Board, and their interest in avoiding a costly proxy contest. The Reporting Persons are awaiting the Issuer’s response and maintain that all shareholders’ best interests lie in a favorable outcome.

 

My bet is that he gets his seats. He's always interesting to watch.

 

Yeah at this stage I don't think anyone believe Sardar when he says he wants to 'work constructively' with anyone...

[Greg]

Don't you like Biglari? He has said that he wants to treat his shareholders well.

For example:

 

"We are here to make money with you, not off you"-Warren Buffett, 1996 letter to shareholders.

 

"Not only will I refuse extra remuneration for the time I intend to commit, but I also will not accept any stock options. The reason is simple:We are one of the largest shareholders; thus, we plan to make money with you, not off you."-Sardar Biglari, 2008 letter to Steak N Shake shareholders.

[dcollon]

New Letter to CBRL:

 

Biglari Holdings Sends Letter To Cracker Barrel's Board On Discovery Of Discrepancy In Professed Experience Of Designated Chairman James Bradford

Monday, October 08, 2012 08:15:00 AM

 

 

SAN ANTONIO, TX, Oct. 8, 2012 /PRNewswire/ -- Biglari Holdings Inc. (NYSE: BH) today sent the following letter to the Board of Directors of Cracker Barrel Old Country Store, Inc. (NASDAQ: CBRL) regarding public filings and statements made by Cracker Barrel, including Chief Executive Officer Sandra B. Cochran, that highlight designated Chairman James W. Bradford's former experience as CEO of a New York Stock Exchange-listed company: 

 

October 8, 2012

 

Board of Directors

Cracker Barrel Old Country Store, Inc.

305 Hartmann Drive

Lebanon, Tennessee 37087

 

Dear Board of Directors:

 

Cracker Barrel's proxy statement filed with the Securities and Exchange Commission in connection with the Company's 2012 annual shareholders' meeting contains the following statement regarding the qualifications of James W. Bradford, Cracker Barrel's designated Chairman of the Board:  "An experienced corporate executive, Mr. Bradford previously served ... from 1992 to 1999 as President and Chief Executive Officer of AFG Industries Inc., which during his tenure was North America's largest vertically integrated glass manufacturing and fabrication company and was traded on the New York Stock Exchange (the 'NYSE')."

 

This assertion was repeated to investors at the Wells Fargo Retail & Restaurants Conference on October 2, 2012 by Cracker Barrel's Chief Executive Officer, Sandra Cochran, who stated that "Jim Bradford, who was the former CEO of [a] New York Stock Exchange company, and he's now the Dean of the Business School at Vanderbilt...."

 

Then on October 4, 2012, Ms. Cochran wrote a letter to shareholders highlighting the changes to the Board by stressing the experience of the incoming Chairman: "[Michael Woodhouse] will be succeeded by Jim Bradford, a former NYSE company CEO...."

 

As the largest shareholder of the Company, owning approximately 17.3% of the outstanding shares, we felt it was important for us to understand Mr. Bradford's performance as a purportedly former CEO of a public company, in view of his recent appointment as the incoming Chairman of the Board, as well as Ms. Cochran's statements underlining his position as "a former NYSE company CEO." However, a public search reveals that Mr. Bradford has never been CEO of a New York Stock Exchange company. In fact, we found that AFG Industries in 1988 was taken private, four years before Mr. Bradford was appointed CEO. 

 

The Company has claimed that Mr. Bradford was CEO of a NYSE company by way of SEC disclosures and statements from Ms. Cochran. The question for shareholders is whether Mr. Bradford was indeed CEO of a NYSE-listed company. If the answer is negative, then misrepresentations have been made in SEC filings, investor presentations, and a letter to shareholders. If Mr. Bradford has embellished his professional record, we believe this undermines his credibility. Therefore, the Board must determine whether Mr. Bradford should continue in his present capacity. After all, it is Mr. Bradford's, Ms. Cochran's and the full Board's responsibility to ensure the accuracy of the Company's public filings and statements. A Board must exercise diligence and care; such a material inaccuracy would be a failure on the part of the Board of Directors, especially the Nominating and Corporate Governance Committee, reflecting poorly on the entire Board's governance process.

 

In its proxy statement, Cracker Barrel claims to have strict procedures and standards and to have engaged in "significant efforts" to identify qualified candidates for director. Echoing its Corporate Governance Guidelines, Cracker Barrel states in its proxy statement:

 

"The Nominating and Corporate Governance Committee assesses a candidate's independence, background and experience.... The Nominating and Corporate Governance Committee recommends appropriate candidates with the goal that the Board of Directors be comprised of qualified individuals.... Individual directors and any person nominated to serve as a director should possess the highest moral integrity and should generally have had significant managerial experience in the form of being a current or former senior executive of a publicly traded or privately held company or similar business experience or training."

 

We certainly understand why the Board, in the midst of a proxy contest, would be interested in highlighting an accomplishment of a director, especially an incoming Chairman, who would have led a NYSE-listed company in the capacity of CEO. Initially we had no reason to doubt the Board or Mr. Bradford. We assumed that the Nominating and Corporate Governance Committee would have conducted a thorough background check on the incoming Chairman. It is certainly the obligation of the full Board, including that of Ms. Cochran, to be fully versed about Mr. Bradford's professional accomplishments. Assuming Mr. Bradford was required to complete Cracker Barrel's 22-page, 33-question director-and-officer questionnaire that Phil Cooley and I were required to submit in connection with our nomination to the Board, we believe that, at the very least, his responses to questions 3 and 33 should have shed light on his experience at the public company. (Enclosed with this letter is Cracker Barrel's questionnaire, which is especially voluminous.)

 

Should our concerns about the accuracy of Mr. Bradford's experience prove correct, then shareholders should seriously question the level of diligence and oversight exercised by Cracker Barrel's Board of Directors in the vitally important vetting process for identifying qualified directors, including the one director possessing the essential character and experience to serve as Chairman of the Board.

 

We hope that the Board can provide shareholders with a satisfactory explanation. In order to do so, we call upon the Board to conduct immediately an independent investigation to understand whether Mr. Bradford misrepresented his prior position to the Board and thereby led Ms. Cochran to misrepresent Mr. Bradford's credentials to the public. The investigation should also determine whether the Company's Code of Business Conduct and Ethics has been violated. We believe shareholders have a basic right to know the facts, including the correct answers to the following questions:

 

Did Mr. Bradford mislead the Board regarding his past experience and qualifications to serve as a director of Cracker Barrel?

Did Mr. Bradford's misrepresentations lead Ms. Cochran to misinform investors of his credentials in her October 4, 2012 letter to shareholders as well as during her presentation at the Wells Fargo conference on October 2, 2012?

Why would CEO Sandra Cochran not be aware of the credentials of the Company's designated Chairman of the Board?

By including Mr. Bradford's inaccurate biography in its proxy statement, did any officers or directors of the Company violate its Code of Business Conduct and Ethics, which contains the following requirements:  "Directors, officers and employees who are involved in the process of preparing the periodic reports required by applicable securities laws and rules are responsible for ensuring that the disclosure in the Company's periodic reports is full, fair, accurate, timely and understandable....Knowingly making or maintaining false, misleading or incomplete entries, records or documentation is strictly prohibited."

A separate review should also be conducted to understand fully the process by which background checks and the vetting are conducted by the Nominating and Corporate Governance Committee, which bears responsibility for the accuracy of the credentials of Board members. Incidentally, Mr. Bradford is not only the designated Chairman of the Board, but also is the current Chairman of the Nominating and Corporate Governance Committee. 

 

We urge the Cracker Barrel Board to report the results of this investigation to shareholders in sufficient time for them to cast their votes for directors at the 2012 annual meeting. Shareholders have a fundamental right to know that the stewards of their investment have been chosen with great care and possess the requisite qualities of leadership.

 

Furthermore, this proxy contest should have been avoided, for, in our view, we bring shareholder representation of 17.3%, including a long-term perspective, relevant industry experience, yet no business or legal conflicts. Because we are independent, we would critically and objectively discuss business issues. Patently, as the Company's largest shareholder, we are interested in finding ways to advance shareholder value. Moreover, the current proxy contest is centered on Phil Cooley's and my holding two board seats out of ten; that is, we are neither asking nor seeking board control or ownership control of Cracker Barrel.

 

We await your immediate response.

 

Sincerely,

 

/s/ Sardar Biglari

 

Sardar Biglari

 

[MYDemaray]

Don't you like Biglari? He has said that he wants to treat his shareholders well.

For example:

 

"We are here to make money with you, not off you"-Warren Buffett, 1996 letter to shareholders.

 

"Not only will I refuse extra remuneration for the time I intend to commit, but I also will not accept any stock options. The reason is simple:We are one of the largest shareholders; thus, we plan to make money with you, not off you."-Sardar Biglari, 2008 letter to Steak N Shake shareholders.

 

Watch what he does, not what he says.  E.g., his proposal to take 25% of book value above a 5% hurdle.

[dcollon]

Cracker Barrel responds to letter from Sardar Biglari regarding experience of Chairman James Bradford

Tuesday, October 09, 2012 01:29:51 PM

 

 

In the 8-Oct letter, Biglari (BH) calls into question one aspect of Bradford’s credentials.

Bradford was appointed to the Cracker Barrel board in July 2011 and will become the independent Chairman of the board next month.

CBRL notes that Bradford did not represent to the Company’s Board that AFG was publicly traded during the time he served as CEO of that company.

However, the wording of the Company’s proxy statement and subsequent statements was presented in a manner that suggested the contrary.

The Company regrets any resulting misunderstanding.

The facts remain that Mr. Bradford was indeed the CEO of AFG Industries and AFG Industries was an NYSE-listed company while Mr. Bradford was the general counsel and prior to his assuming the role of CEO.

 

[MYDemaray]

Biglari (BH) calls into question one aspect of Bradford’s credentials.

 

Trying to be Dan Loeb...which he's not

[OracleofCarolina]

http://finance.yahoo.com/news/biglari-holdings-responds-cracker-barrels-225800934.html

 

You guys are going to love Biglari's response....ah man, this guy cracks me up!

[ragnarisapirate]

http://finance.yahoo.com/news/biglari-holdings-responds-cracker-barrels-225800934.html

 

You guys are going to love Biglari's response....ah man, this guy cracks me up!

 

But he raises good points. I mean, owning over 17% of a company's stock is a pretty good reason to get a board seat....

[matts]

I can't believe my first post on the board will be about this, but...

 

What a character. He might have some good points but that is no way to speak or conduct yourself in a professional manner while addressing a board of directors. Can you imagine Buffett ever speaking like this? I wouldn't invest with this guy no matter how much money makes. However, I am considering front-running his ridiculous attempts at gaining control of companies in the future. His ego is getting the best of him. Anyone know if he buys his stakes all in 1 shot or does he continue buying after the initial disclosure?

 

[Parsad]

http://finance.yahoo.com/news/biglari-holdings-responds-cracker-barrels-225800934.html

 

You guys are going to love Biglari's response....ah man, this guy cracks me up!

 

But he raises good points. I mean, owning over 17% of a company's stock is a pretty good reason to get a board seat....

 

Yes, I would have to agree.  He does douchy things, but he's correct here.  They should have corrected the credentials, and he should get a board seat.  But the problem is...you give him one seat, and that's it...he's going to eventually whittle away the board and take over the company.  It'll be called "Cracker Biglari" shortly thereafter.  ;D  Cheers!