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BH - Biglari Holdings


accutronman

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First sale of CBRL for Biglari holdings. Not sure if this is tied to the prepaid variable contract from a few years ago, or the huge gap in performance and value between BH and CBRL.

 

I believe he filed to sell 400,000 shares. Looks like a good sale in my view. Now if he would do something to benefit all shareholders.

 

 

https://investor.crackerbarrel.com/static-files/60dc8567-4123-4785-8e83-6e3022c8cf1d

 

 

 

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Hey all:

 

The Steak & Shake near me just started some new promotion.

 

4 meals with 4 items for $4.

 

You can get burger, fries, chili & cookie for $4.

 

That is a HECK of a deal!

 

I'll do the legwork for the board and report back.

 

Hard to see how they can make much money off this.

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First sale of CBRL for Biglari holdings. Not sure if this is tied to the prepaid variable contract from a few years ago, or the huge gap in performance and value between BH and CBRL.

 

I believe he filed to sell 400,000 shares. Looks like a good sale in my view. Now if he would do something to benefit all shareholders.

 

 

https://investor.crackerbarrel.com/static-files/60dc8567-4123-4785-8e83-6e3022c8cf1d

 

Probably worth mentioning that a short seller just did a presentation on CBRL yesterday. An interesting coincidence, but I doubt it's connected with Mr Big selling down his stake. I think the stock is just fully valued here + (as you mention) there's a gaping chasm between the performance and valuations of the two stocks.

 

https://seekingalpha.com/news/3414008-cracker-barrel-short-pick-tilson-conference

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https://www.sec.gov/Archives/edgar/data/1067294/000092189518003187/xslF345X03/form407428021_12032018.xml

 

Sold 1500 June 210 strike for $284.23 each, $426,345

And 760 for $217.96 each, $165,650

 

** and I should add that today 12/4, he sold an additional 500 contracts at $215 each, for $107,500.  They are all June 2019 over-the-counter (custom) options contracts, out of the money, above the market by a fair bit.  **

 

 

I see he sold 2 sets of call options. Can anyone teach me how to find out how much in premiums he received for selling the calls?

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  • 2 weeks later...

BH up today after Mr Big personally (not Lion Fund I/II or Biglari Capital) bought both A and B shares:

 

https://www.sec.gov/Archives/edgar/data/1334429/000092189518003300/xslF345X03/form407428007_12132018.xml

 

The Lion Fund II continues to sell CBRL shares:

 

https://www.sec.gov/Archives/edgar/data/1067294/000092189518003301/xslF345X03/form407428021_12132018.xml

 

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  • 4 weeks later...

Poor Lance Funston... He sounds like he is ready to sell the company.  Wouldn't be surprised if he had a buyer for CAW by the end of the year.  Coming up with $4.65 million more for shares trading for $1.9 million in the open market probably isn't his happy place.  He's looking to sell for 3x revenues or thereabouts on enterprise value if I remember correctly.  Maybe a bit more.

 

edit- for the record, the put option is with Funston personally, not CCA Industries, and you are correct - it expires 1/31/19

 

I guess there will be a little bump in the cash for Mr Bigs this month. I believe this is the month he can put back his shares of CCA Industries back to the company for $6/share and there would be no reason for him not to do that.

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Despite his stupidity, shareholders are not punishing the company. I wonder how the share can stay above 400 USD. When will people give up on him?

 

When it's too late...

 

I think most would say its already too late. The point of no return was when he tendered to obtain over 50% of the company.

 

I think most who have stayed away would say it's too late. The share price suggests that the majority believe otherwise.

 

Maybe now shareholders are finally punishing the company - down 61% since it's highs in 5-years ago.

 

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Interesting time to be selling - it's in the upper range what it's traded for over the past 2-years, but multiple times where it's traded at this price and wasn't sold.

 

I'll admit, I don't follow this too closely other than checking in on the price very few months, but any idea what he's intended to do with the proceeds? Purchase more BH? A new investment?

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  • 2 weeks later...

 

Interesting time to be selling - it's in the upper range what it's traded for over the past 2-years, but multiple times where it's traded at this price and wasn't sold.

 

I'll admit, I don't follow this too closely other than checking in on the price very few months, but any idea what he's intended to do with the proceeds? Purchase more BH? A new investment?

 

My speculation is that he's either buying into trashed Oil and Gas stocks, or raising cash to make a purchase.

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  • 3 weeks later...

https://www.otcmarkets.com/filing/conv_pdf?id=13190459&guid=u5rtUnzRuvZMT3h

 

Seems like Fat Brands needed some cash pronto...20% interest from Biglari and warrants to buy shares at .01 if not paid back by Oct 1, 2019

 

"Item

1.01 Entry into a Material Definitive Agreement.

On

January 29, 2019, FAT Brands Inc. (the “

Company

”) refinanced its existing lending facility with FB Lending,

LLC. The Company as borrower, and

its subsidiaries and affiliates as guarantors, entered into a new Loan and Security Agreement

(the “

Loan Agreement

”) with The Lion Fund, L.P. and The Lion

Fund II, L.P. (the “

Lenders

”).

Pursuant to the Loan Agreement, the Company borrowed $20.0 million from the Lenders, and utilized the proceeds to repay the

existing

$16.0 million term loan from FB Lending, LLC plus accrued interest and fees, and provide additional general working capital to

the Company.

The

term loan under the Loan Agreement matures on June 30, 2020. Interest on the term loan accrues at an annual fixed rate of 20.0%

and is payable

quarterly. The Company may prepay all or a portion of the outstanding principal and accrued unpaid interest under

the Loan Agreement at any time upon prior

notice to the Lenders without penalty, other than a make-whole provision providing for

a minimum of six months’ interest. The Company is required to prepay all

or a portion of the outstanding principal and accrued

unpaid interest under the Loan Agreement in connection with certain dispositions of assets, extraordinary

receipts, issuances

of additional debt or equity, or a change of control of the Company.

In

connection with the Loan Agreement, the Company issued to the Lenders a warrant to purchase up to 1,143,112 shares of the Company’s

Common

Stock at $0.01 per share (the “

Lender Warrant

”), exercisable only if the amounts outstanding under the

Loan Agreement are not repaid in full prior to October

1, 2019. If the Loan Agreement is repaid in full prior to October 1, 2019,

the Lender Warrant will terminate in its entirety.

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  • 1 month later...

Yet more compensation changes for Mr Big. Now he's even less aligned with outside shareholders. Since he controls a majority of the voting power, a change of control is very unlikely. Therefore, he really didn't give up anything of value.

 

"The Incentive Agreement was amended on March 26, 2019 to remove the $10,000,000 annual limitation on Mr. Biglari’s incentive compensation and the requirement of Mr. Biglari to use 30% of his incentive payments to purchase shares of the Company, in consideration for the elimination of the change of control and severance provisions contained in the Incentive Agreement and the termination of the License Agreement with Mr. Biglari. The March 26, 2019 amendment is effective in 2019."

 

https://www.sec.gov/Archives/edgar/data/1726173/000092189519000944/def14a07428007_03292019.htm

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Yet more compensation changes for Mr Big. Now he's even less aligned with outside shareholders. Since he controls a majority of the voting power, a change of control is very unlikely. Therefore, he really didn't give up anything of value.

 

"The Incentive Agreement was amended on March 26, 2019 to remove the $10,000,000 annual limitation on Mr. Biglari’s incentive compensation and the requirement of Mr. Biglari to use 30% of his incentive payments to purchase shares of the Company, in consideration for the elimination of the change of control and severance provisions contained in the Incentive Agreement and the termination of the License Agreement with Mr. Biglari. The March 26, 2019 amendment is effective in 2019."

 

https://www.sec.gov/Archives/edgar/data/1726173/000092189519000944/def14a07428007_03292019.htm

 

That's probably an april fools joke. Wasn't the idea for him to gain control so he could really start adding value for outside shareholders. I'm pretty sure I read that somewhere...

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"The Incentive Agreement was amended on March 26, 2019 to remove the $10,000,000 annual limitation on Mr. Biglari’s incentive compensation and the requirement of Mr. Biglari to use 30% of his incentive payments to purchase shares of the Company"

 

No more limits on his compensation.  It's almost like he wanted to gain control of the company only to fleece the outside shareholders.  No one saw this coming. If only there was a way this could have been predicted.

 

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"The Incentive Agreement was amended on March 26, 2019 to remove the $10,000,000 annual limitation on Mr. Biglari’s incentive compensation and the requirement of Mr. Biglari to use 30% of his incentive payments to purchase shares of the Company"

 

No more limits on his compensation.  It's almost like he wanted to gain control of the company only to fleece the outside shareholders.  No one saw this coming. If only there was a way this could have been predicted.

 

If only...

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"The Incentive Agreement was amended on March 26, 2019 to remove the $10,000,000 annual limitation on Mr. Biglari’s incentive compensation and the requirement of Mr. Biglari to use 30% of his incentive payments to purchase shares of the Company"

 

No more limits on his compensation.  It's almost like he wanted to gain control of the company only to fleece the outside shareholders.  No one saw this coming. If only there was a way this could have been predicted.

 

 

You're kidding right! This is an extract from one of my posts from 2015:

 

 

 

 

I don't like the guy, I don't like the incentives the way they are and I think that when management's trustworthiness and the incentives are not perfect (yep, perfect), I should not risk my money. I'd rather pass on a good thing than get on the wrong train. Good luck to those who think this is the beginning of an amazing story as that of Buffett, my guess is that you are about to get dissapointed.

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"The Incentive Agreement was amended on March 26, 2019 to remove the $10,000,000 annual limitation on Mr. Biglari’s incentive compensation and the requirement of Mr. Biglari to use 30% of his incentive payments to purchase shares of the Company"

 

No more limits on his compensation.  It's almost like he wanted to gain control of the company only to fleece the outside shareholders.  No one saw this coming. If only there was a way this could have been predicted.

 

 

You're kidding right! This is an extract from one of my posts from 2015:

 

 

 

 

I don't like the guy, I don't like the incentives the way they are and I think that when management's trustworthiness and the incentives are not perfect (yep, perfect), I should not risk my money. I'd rather pass on a good thing than get on the wrong train. Good luck to those who think this is the beginning of an amazing story as that of Buffett, my guess is that you are about to get dissapointed.

 

Yes forgot smiley face ?

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