We believe Mr. Biglari and Mr. Cooley are wrong for Cracker Barrels Board and their election could jeopardize the powerful momentum we have built in the past year, Cochran said.
The stock market, she noted, has recognized Cracker Barrels progress since the announcement of the Companys six strategic priorities on Sept. 13, 2011, with a 68.4 percent appreciation in the value of the Companys shares through Sept. 28, 2012. In addition, she pointed out that Cracker Barrel:
Has increased its quarterly dividend 100 percent over the last year and continued its share buyback program.
Had an excellent fourth quarter and full-year fiscal 2012 as a result of successfully implementing key strategic initiatives.
Has a talented new management team, with five senior executives either new to the Company or serving in new positions since January 2011.
Has benefitted from the effective leadership of its renewed Board of Directors, with six new independent directors joining the Board within the last 18 months.
Cochran noted that Cracker Barrel has successfully delivered on the strategy it set out last year, noting, We believe the facts today provide even stronger support for Cracker Barrel and its management and Board.
She added, In these challenging economic times, we strongly believe it is in the best interest of all of our shareholders to allow our cohesive and revitalized Board to continue our recent and ongoing success, and stay focused on the execution of our strategic initiatives. Our strong results, our commitment to the highest standards of corporate governance and our determination to serve the best interests of our shareholders speak for themselves.
In September, Biglari was assessed a $850,000 fine as a civil penalty to settle charges that Biglari Holdings Inc. violated premerger reporting and waiting requirements when it acquired significant stock holdings in Cracker Barrel. The fine was announced by officials with the U.S. Department of Justice.
Biglari had previously refused an officer by Cracker Barrels Board of Directors to appoint two independent members to the board. He owns a 17.5 percent stake in Cracker Barrel and has been waging a proxy battle for two seats on the board.
The Justice Departments Antitrust Division, at the request of the Federal Trade Commission, filed a civil antitrust lawsuit on Sept. 25 in U.S. District Court in Washington, D.C., against Biglari Holdings for violating the notification requirements of the Hart-Scott-Rodino (HSR) Act of 1976.
At the same time, the department filed a proposed settlement that, if approved by the court, will settle the charges.
The HSR Act of 1976, an amendment to the Clayton Act, imposes notification and waiting period requirements on individuals and companies over a certain size before they consummate acquisitions resulting in holding stock or assets above a certain value, which was $66 million in 2011 and is currently $68.2 million.
A federal judge must approve the settlement before it can take effect.