Cracker Barrel Old Country Store, Inc. · NASDAQ:CBRL
Cracker Barrel Old Country Store — Proxy Contest (November 2011)
47 slides from Cracker Barrel Old Country Store's proxy contest presentation, Nov 1, 2011
Slide 1: Schedule 14A Soliciting Material
UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 SCHEDULE 14A Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934 (Amendment No. ) Filed by the Registrant x Filed by a party other than the Registrant ¨ Check the appropriate box: ¨ Preliminary Proxy
Slide 2: Filing fee information
(1) Amount Previously Paid: (2) Form, Schedule or Registration Statement No.: (3) Filing Party: (4) Date Filed:
Slide 3: Note on investor presentation use
Cracker Barrel Old Country Store, Inc. (the “Company”) used the following investor presentation in meetings with investors beginning on November 1, 2011. This investor presentation was also posted to the “Biglari Proxy Contest” section of the Company’s Investor Relations website, investor.crackerbar
Slide 4: Investor Presentation Fall 2011
Old Country Investor Fall 2011Presentation Store
Slide 5: Additional information and forward-looking statements
Additional matters materially More 1995. Important Cracker considered solicitation SHAREHOLDERS PROXY IMPORTANT Statement supplements Relations 2 detailed discussed Barrel Barrel, CARD section Additional and from Information at oftoCracker proxies information INFORMATION. other Old the its those AND
Slide 6: Agenda
I. Overview Agenda Cracker Ongoing Other Why 3 Biglari Proxy Barrel’s Transformation Matters is Wrong History forofCracker Success the Company Barrel
Slide 7: I. Overview
I. Overview 4
Slide 8: History, Management and growth
History, Management growth into Pleasing 6,740 CBRL Nov Cracker Ranked 1990 1981 Family chain Restaurant Magazine, Institutions title successive the given Aug Mike June Recapitalization achieve Dec acquisition Logan’s capital In divestiture Announces Logan A 608 Today 816 S&P5I 201 Note: 5 30 March
Slide 9: Cracker Barrel and Biglari timeline
Cracker 23-Jun-2011 Biglari 26-Aug-2011 BH 13-Jun-2011 Nominating 21-Jul-2011 9.7% interviews 1-Sep-2011 CBRL 23-March-2011 September August July June March Meets Committee Consider Board 17-June-2011 Peterson James 27-July-2011 Bradford Sandra 1-Aug-2011 Named Two 12-Sep-2011 members they for 9-Aug
Slide 10: The Board: Experienced
Experienced The Board Elected Michael 1999 Sandra Robert assumed 1986 States GCO) James 2011 Management. 1992 Richard Managing 2005 Charles 1981 presently B.F. 1971 William Chairman President travel Martha 1993 relations IColeman President/CEO Andrea 2003 and Note: 7 new young Right (Jack) Became De
Slide 11: Letter: Biglari refused good faith settlement offer
Cracker Letter “. “Under Biglari -“When 8 Michael .in an toHoldings we that Barrel effort Sardar Woodhouse spoke offer, toMade Biglari, be and on weconstructive, August approved awould Good 22-Aug-2011: 10, immediately Faith by 2011, the the Settlement Board Cracker youadd indicated authorized to Of
Slide 12: Key Facts
Keyaengaged Cracker Sardar Continues As Has 9 outperformed significantly repeatedly apreviously Facts CEO strategy history Biglari Barrel to of Consider strive in aofin competing refused used what “extraordinary” place renewed the for proxy we market operational for toview disclose restaurant the ne
Slide 13: II. Cracker Barrel's History of Success
II. Cracker Barrel’s History of Success 10
Slide 14: The Cracker Barrel Old Country Store Concept
The Cracker Owns Pleasing Honest 11 and value People®—genuine operates Barrel Good 608 Concept country Old cookin’ Country hospitality Old-fashioned Stores across 42 country statesstore Welcome break for travelers
Slide 15: Menu Has Evolved to Maintain Relevance
Menu Traditional New Sunrise Wholesome Fancy Six Breakfast Pancake Granola Chicken 12 Salad Vegetable Grain Menu Has Fixin’s Sampler n’n’ Evolved Dumplins Menu Offerings Mornin’ Meatloaf Offers toSampler Appeal Country Maintain Dinner ‘Home-Style” toDinner Relevance LighterPlate Country Users and Re
Slide 16: Retail Integral for Guest Experience
Retailfor Guest Rockers Gifts Cracker Exclusive 13 waiting is Barrel on Integral under music thearea branded $20 front to the Regional porch Cracker foodsproducts Barrel Experience
Slide 17: Winning Consumer Honors
Winning #1 -Nation’s CONSUMER NATION’S ‘Best Top Ranked Restaurants -Most 14 The Zagat’s Consumer Restaurants Family ofRV-Friendly Breakfast” Good the asConcept 2010 Restaurant Dining Full-Service the Sam &Brand &(Consumer Top Institutions &Institutions Club among 2011 Results Restaurant Sit-Down “F
Slide 18: Has Outperformed Peers Over Long Term
Powerful Last 160% 140% 280% 120% 250% 9) 220% |(U “g 190% < x M 20% 70% 100% 60% 40% Daily ai Source: Note: 15 80% uCracker 130% 160% X10 5APeer from A -\ --i Years Years Bloomberg Concept Barrel group 29-Sep-2006 28-Sep-2001 includes aHas Restaurant as of Outperformed to 30-Sep-2011 Biglari 30-Sep
Slide 19: Five-Year Total Shareholder Return Exceeds Peers
.And%Median: 2.6 2.0 Peer (2.4)% (2.6)% (1.9)% 1.8% Cracker (23.7)% (4.1)% Factory Source: dividends 16 Five-Year Restaurants S&P Barrel andResearch (2.4)% the Biglari Total compounding Roadhouse Shareholder Holdings Insight, 30-Sep-2011. effect Brinker Return ofCheesecake dividends Exceeds Total Pe
Slide 20: We Also Outperform on Comparable Store Sales
We Also Cumulative Base FY06 100.5 100.3 99.5 101.2 100.7 100.0 Cracker Note: 17 Year Knapp-Track™ FY07 Barrel Outperform Comparable FY08 ^^”Knapp-Track™ FY09 Knapp-Track™ Casual Same FY10Dining Store FY11 Casual Sales Index CasualDining Index, same Dining store FY2006 Index* sales= figure 100 is an
Slide 21: We Have Achieved a More Attractive ROIC
We % Estimated 14.8 15.2% 12.5 8.6 11.8% 5.8 Cracker Restaurants Source: Note: Value 18 Have %ROIC ofCapital Barrel Total Achieved Latest International calculated Equity. Biglari IQ Twelve and a More Debt Holdings as latest Months Factory NOPAT Attractive figures available Darden ROIC over exclude R
Slide 22: III. Ongoing Transformation of the Company
III. Ongoing Transformation of the Company 19
Slide 23: New CEO Brings Energy and Plan
CEO Energy 1 11 2 3 4 5 6 Sandy and New aCochran marketing Plan Refined Enhanced Innovative Focused Balanced to menu cost Grow Brings messaging and restaurant tactics Traffic, toExperience, pricing reduction approach Sales, operating driving retail capital Profits platform sales and Shareholder Valu
Slide 24: New Marketing Strategy
CBRL New Reinforce Marketing Advertising Newly-redesigned Refined •Increase Sustainably Platform Operating Restaurant Enhanced Refinement Increased 21Increase Promotional New Marketing offerings Strategic Menu Variety focus Authentic guest spend of Improve to strategy restaurant and build on visits
Slide 25: Balanced Capital Allocation and Cost Tactics
CBRL Tactics Innovative Retail Deliver Growth Emphasize Highlight Focused maintenance Offset •Pressure Balanced Approach P Capital Allocation Enhance 22New Investments to I •Sales Commodity system Strategic Steady Driving increase Value Cost *0accretive affordability to $1Omm New share unique cn, an
Slide 26: What Analysts Are Saying
What Analyst 3 23 ets; Analysts “Management to initiatives “New 13-Sep-2011 -“We “In Biglari -Robert Source: Brad Stephen Bryan almost times Jdo Commentary believe CEO Ludington, has not Elliot, Are Derrington, Publically past triple Anderson, outlined the expect Sandra over theSaying management, th
Slide 27: IV. Other Proxy Matters
IV. Other Proxy Matters Yous Coun 24
Slide 28: Adopted Shareholder-Friendly Rights Plan
Shareholder-Friendly Adopted Shareholder Rights If Biglari’s Belied fulfilling “We 25 shareholders areby plan expire control Argument in that His response would is friendly objective, ifOwn focused approve, shareholders investors. not that Words to provisions: Rights on be Biglari the we rights trig
Slide 29: Reward and Align Management Compensation
Reward Align Attract Base Strong As Compensation The Year-over-year •Improvement Management 26 Cracker Indescribed fiscal Compensation salaries executives’ pay-for-performance and performance Barrel’s 2011, retain generally in Paid Incentives inCommittee improvement our the Total ROIC talented inter
Slide 30: Holding Company Merger Plan
Plan Although Why Holding Realize Simplify •Facilitate 27 Cracker Merging to now? Collapse tax Company company the more Barrel the the The and corporate Holding two efficient previous other Old Holding format companies was Country savings Company structure originally cash credit Company no longer ma
Slide 31: V. Why Biglari is Wrong for Cracker Barrel
V. Why Biglari is Wrong for Cracker Barrel 28
Slide 32: Why Biglari Is Wrong for Cracker Barrel
Whyrepeatedly Has Gained Slashed Proposed Returns Presence 29 Weinitial operational little Believe on excessive dualour cash board class refused Board Biglari tocompensation investment of representation shareholders stock would toIsdisclose Wrong atcreate Biglari at Steak plan his for ataSteak speci
Slide 33: Biglari's Original Intentions vs Actual Actions
Biglari’s Original Target Actual 13-Jun-2011 23-Sep-2011: 7-Aug-2006 23-Jun-2011: 26-Aug-2011: 1-Sep-2011: 8-Sept-2011: 11-Dec-2006: 17-Jun-2007: lO-Nov-2005 1-Dec-2005: 22-Oct-2009: 17-Aug-2007 12-Aug-2007: 7-Mar-2008: 8-Aug-2008: Source: 30 Actions Public Announced Rhetoric 13D: Launched 13D: Bigl
Slide 34: How Biglari Took Control of Steak n Shake
How Steak Holdings BlGLAR] 8-Aug-2008 Ownership Today: ^r 19-Jun-2008 Two Jul-2008 uuai Source: Stock As Purchased Lion Western P. Cooley’s Call 20,000 561,000 7-Mar-2008 5.8% Share 17-Aug-2007 ownership Nominates Renamed 8-Apr-2010 Announces 22-Oct-2009 6.8%2 Biglari he Instead X 31 Coo Took Share
Slide 35: Biglari's Board Changes at Steak n Shake
Paul Jones Alan Thomas Titus After Fred Name Sardar Phillip 2008 Kenneth 2010 Biglari Chairman Background Age Role 34 Vice the Advisory 67 Director Biglari’s •66 Chancellor Management, Independent Served Michigan-Flint 65 of Development Geoffrey John Ruth Source: 1 2 32Served His Directors 2007 Boar
Slide 36: We Are Not the Only Ones Who Think So
We Are “.there .although board -Wayne “The over -Indianapolis Note: 33 Steak’n unanimous Permission has does Not L.our not Kelley, the not Shake Business current been Only appear vote toFormer actively despite use chairman Ones [to Journal; toquotes transform be Steak Who his involved anyrelatively
Slide 37: Capital Investing in Growth Stopped at Steak n Shake
($.6inQ2 FY Q1 FY2011 9.1 1.0% Steak Months Sales 8.1 I6 5.1 3.3 1.4% 1.7% 1.1% 7.5 Median 5.3 Latest 1.8% 3.2 2.8 2.2 Biglari Holdings Source: Note: 34 2008 2009 2010 %Millions) 0.9% 1.3% 1.8% Over An ‘n Red Twelve iCrackerBarrel Q3 Stopped Capital = Capex Q3 Shake Q1 Shake. Restaurants 3.0 Line Q4
Slide 38: Biglari's Compensation Package
.And Compensation iPublic If •This Following Biglari ““One k “The -they Source: Note: 35 The Richard Ken NFI Biglari’s Hand-picked theare isFocused pay current decision of $300mm Shareholder Permission Skarbeck, Reaction in received BH simply the is addition Gibbons, proposed adverse too Annual swee
Slide 39: Biglari's Dual Class Stock Proposal
.And Minority Biglari’s Biglari X But 36Under Could Class given Maintaining isBenhance Dual the Ownership attempting shareholder stock proposal Class would his Control Stock to voting Class challenges be create his Despite Proposal B control currency ashares dual toHis and these class = for 1/5 redu
Slide 40: Biglari's Views vs His Own Money
IJjjive -Biglari’s Biglari If 37 Biglari invested Oddly does really letter not Views to about views personally CBRL His $100 a public Shareholders’ shareholders, million owncompany’s anyinstock the 12 Money stock September ownership directly as of His Cracker in Cracker as 2011 OwnhisBarrel own, Bar
Slide 41: Biglari Director Duty of Loyalty Conflict
Sardar Should tyof We Cracker •What 38 How Biglari’s compete seek Care Biglari can Biglari Biglari Barrel’s to•proposed Biglari Duty attract with learns Has become board ofmany restaurant fulfill aLoyalty from board Business regularly arestaurant his Director our service -> duties traffic board Conf
Slide 42: Cracker Barrel and Steak n Shake Are Similar Competitors
Cracker Full Similar Dinner Lunch Geographical Mid 39 Service, — High Menu BarrelFamily Single Overlap Items and Steak Digits Dining Americana *n Format ShakeBrand are Breakfast Competitors Alcoholic Beverages Average Check
Slide 43: Illustrative Menu Item Similarities
Illustrative Old NEW Skillet CAKES Momma’s GRILLED Chicken Source: 40 Country COUNTRY Breakfast1 Cracker *N *nPancakes CHICKEN Menu Vegetable EGGS Store Barrel ItemSalad Similarities archive and Steak ‘n Shake website 1 Not currently offered.
Slide 44: Extensive Geographical Overlap
Extensive Source: 41 Company Geographical websites Overlap: We Compete for the Same Guests
Slide 45: Biglari Slashed Capital Expenditures, But Paid to Put His Picture in Every Restaurant
Biglari Slashed Capital Expenditures, But Paid to Put His Picture in Every Restaurant 42
Slide 46: Key Message From Your Current Board
Keybelieve Sardar Our We 43 are have current Message Biglari a delivered strong Biglari Biglari’s board From iscompany wrong isstrong isYour actively playbook dedicated for Current and results our involved aof shareholders to leader over creeping Board Biglari time, in at Cracker the —control and in
Slide 47: Biglari Proxy Contest website screenshot
Restaurant Travel Hobbies Family Fun Shop Online # Share Mem CED Miome Investor documents > Biglari Proxy Contest Presentation to Investors on Biglari Holdings’ Proxy Fight Corporate Governance News and Events | Related press releases: Financial Information Sept 26 i nt in with Qui Stock Information
Cracker Barrel OLD Country Store — Proxy Contest (November 2011) on 6ix