Biglari Holdings

[Parsad]

So why wasn't this enacted in the beginning, when all of this controversy first began?  Oh wait, this was the original structure, but BC was sold to BH because of perceived conflicts.  It's the same thing we would do going forward at MPIC and if we took over a company.

 

Sanjeev, I hope you dont intend to follow Biglari's compensation scheme  ;)

 

Here is the Biglari scheme on the shares owned. He directly owns 10,073 shares out of the 1,433,783  outstanding - a stake of 0.7% in the company he has named after himself!

 

 

Item 5 is hereby amended and restated to read as follows:

 

(a-e) The aggregate percentage of Shares reported owned by each person named herein is based upon 1,433,783 Shares outstanding, which is the total number of Shares outstanding as of May 14, 2013, as reported in the Issuer’s Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission on May 17, 2013.

 

As of the close of business on July 3, 2013, Sardar Biglari owned directly 10,073 Shares, constituting less than 1% of the Shares outstanding.

 

As of the close of business on July 3, 2013, the Lion Fund owned directly 204,115 Shares, constituting approximately 14.2% of the Shares outstanding.  By virtue of their relationships with the Lion Fund discussed in further detail in Item 2, each of BCC and Sardar Biglari may be deemed to beneficially own the Shares owned by the Lion Fund.

 

As of the close of business on July 3, 2013, 852 Shares were held under the 401(k) Plan, constituting less than 1% of the Shares outstanding.  By virtue of his relationship with the 401(k) Plan discussed in further detail in Item 2, Sardar Biglari may be deemed to beneficially own the Shares held under the 401(k) Plan.

 

As of the close of business on July 3, 2013, 210 Shares were held under the Non-Qualified Savings Plan, constituting less than 1% of the Shares outstanding.  By virtue of his relationship with the Non-Qualified Savings Plan discussed in further detail in Item 2, Sardar Biglari may be deemed to beneficially own the Shares held under the Non-Qualified Savings Plan.

 

As of the close of business on July 3, 2013, Philip L. Cooley beneficially owned 4,952 Shares, constituting less than 1% of the Shares outstanding, consisting of 550 Shares owned directly by Philip L. Cooley’s spouse that Philip L. Cooley may be deemed to beneficially own and 4,402 Shares Philip L. Cooley owns directly.  Sardar Biglari shares with Philip L. Cooley the power to vote and dispose of the Shares beneficially owned by Philip L. Cooley and therefore Sardar Biglari may also be deemed to beneficially own such Shares.

 

An aggregate of 220,202 Shares, constituting approximately 15.4% of the Shares outstanding, are reported by the Reporting Persons in this statement.

 

Effective July 3, 2013, Western Acquisitions contributed 758 Shares to the Lion Fund and made a pro rata distribution of 1,628 Shares to a limited partner of Western Acquisitions for no additional consideration.  As a result, Western Acquisitions no longer owns any securities of the Issuer and WSC and Western Investments are no longer deemed to beneficially own any securities of the Issuer.  There were no other transactions in securities of the Issuer by the Reporting Persons during the past 60 days.

 

Nope...I'll own a hell of a lot more than 1% of the stock! 

 

Compensation will be $99,999 annual salary, no options, no stock plan, no bonuses, no director's fees, no car, no jet (fly economy), no Vancouver Club...no Terminal City Club (eat lunch at my desk), and will have an open office (no door). 

 

Why $99,999...because I don't think I'm worth as much as Buffett!  Cheers!

[shalab]

Amen Sanjeev. Gio, do you still plan to hold Bulgaria holdings?

[farnamstreet]

It'd be fun to see Cracker Barrel, take the 200m or so they were going to use to buy him out and purchase BH shares instead and launch a proxy against him.

[giofranchi]

Amen Sanjeev. Gio, do you still plan to hold Bulgaria holdings?

 

Hi shalab,

you know that I strongly believe in “deliberate practice”. All of us, if we practice in the right way, are capable of great things and of reaching great goals! Yet I also believe that the “right way” to practice most of the times is elusive… very hard to find… and in our endeavors we often fool ourselves into thinking that the right path is in front of us, when actually it is not… And we lose precious time… And we finally realize that something is still missing… And we lose faith and motivation… Sadly, it happens too frequently…

 

That’s why I think that as much as I try to study Novak Djokovic, and practice like him, I’d still be losing against him on a tennis court… That’s imo the true role luck plays: some people, very few, get all the numerous and complex pieces of the “deliberate practice” process exactly right! Think about Novak: since the age of 5 he is followed each day by a team of “experts”… Probably for the first 10 years he made no choice, the team of experts chose everything in his stead… And the choices to be made were a lot! Change even the slightest thing in that child, and we would not have the Djoko-robot we admire today… Then, came his turn to make choices… Can you really believe they were all carefully planned and thought out?… I don’t think so… A lot of randomness here as well! That’s why it is very difficult, almost impossible, to device a “deliberate practice” that is so effective and so successful as the one followed by Nole his whole life!

 

BUT… The way we humans have devised business is fortunately much different from the way we have devised sports! In tennis I just cannot jump on the shoulders of Djokovic and share with him the title of number one tennis player in the world… what a shame! In business, instead, not only I certainly can study great entrepreneurs and investors, not only I certainly can practice like them, but fortunately I can also invest in their companies and reap the benefits of their very unique and ultimately hard to fathom history of wildly successful “deliberate practice”!

 

And Biglari, given his young age, really is a Djokovic: can you name some entrepreneur and investor of the same age, who has already been more successful? No? Well, me neither! Among people still in their ‘30s, he is number 1. You see? As far as I am concerned, that is the most important thing. All else is just noise. Hey, listen: “King Icahn” was published in 1993, and rereading it now, it is clear that he already was an outlier! Then, you would have had 7 more years to study and follow him… without investing a dime in his company… just building more and more confidence in his process and abilities… finally, if you had invested with him in 2000, now you would have 11 times your initial capital… 11 times!!!! While the S&P500 almost went nowhere!! But… well, I know… he was not really shareholders oriented… he was too greedy… not someone you can truly rely on… etc. etc. And so, when I asked who had actually invested with Mr. Icahn in 2000, nobody answered…

 

What I mean: when they put together the Avengers team, do you think they worried much about the fact The Hulk is unreliable?! ;D ;D ;D

 

No, seriously… I still like the BH platform and I still think Biglari is among the very best investors out there.

 

giofranchi

 

[Parsad]

It'd be fun to see Cracker Barrel, take the 200m or so they were going to use to buy him out and purchase BH shares instead and launch a proxy against him.

 

They could.  So could a number of other people, including shareholders.  But the problem now is some of the stuff he's done to entrench himself...licensing agreement, significant pro-management votes through stock held by the company, name change!  Cheers! 

[ragu]

I'm curious to what Ragu has to say about this! ;)

 

Saidal,

Heh. We'll hear more about it in the next letter, but I figure Sardar doesn't have the votes to get the cap removed. And there may well have been some dissonance from the Lion Fund partners at the fact that Sardar has been paid pretty well since the incentive agreement, while the fund's partners haven't done as well (to put it mildly).

 

My offer still stands, btw.

 

Best,

Ragu