Cracker Barrel Old Country Store has countered the attacks by its largest shareholder on the resume of its incoming chairman by releasing some documents that show Jim Bradford did not say he had previously run an NYSE-listed company.
In a letter responding to attorneys representing Sardar Biglari, the owner of 17.4 percent of Cracker Barrel's shares and the man who is vying for one of two board seats at the company, Bass Berry & Sims attorney Howard Lamar says the company believes Biglari's requests to peruse documents related to the appointment of Owen Graduate School of Management Dean Bradford are beyond the scope of Tennessee corporate law.
"Cracker Barrel considers Biglari Holdings’ demand not to have been made in good faith or for a proper purpose, as required by the statute," Lamar wrote in the letter. "Instead, Cracker Barrel believes that Biglari Holdings’ purpose is to impugn the integrity of Cracker Barrel and its incoming Chairman, James W. Bradford, in order to obtain a perceived advantage in Biglari Holdings’ pending proxy contest."
Nevertheless, Lamar wrote, Cracker Barrel officials have released various documents detailing the process of Bradford's board vetting, appointment and subsequent election to chairman-in-waiting. Among them are two passages that support its claim that its previous misrepresentations of Bradford's tenure at AFG Industries — investors had been told Bradford was a former CEO of a publicly listed company — were the result of a "misunderstanding."
In his biography submitted to the board, Bradford said he had been general counsel of AFG "during its years as a public company." In answering Cracker Barrel's director candidate questionnaire — Exhibit G at the bottom of this link — Bradford did not include information on AFG's status when he was CEO. It was taken private in 1988, four years before he was tapped for the top job.
The response to Biglari seems to back up Cracker Barrel's statement last week that Bradford is "beyond reproach" in the representation errors the company has made in recent months as it tried to fend of Biglari. But it is unlikely to assuage Biglari, whose attorney on Monday fired off another letter to the company that accuses it of making several misleading or inaccurate statements during the current proxy contest. Speaking specifically to the Bradford brouhaha, Biglari attorney Steve Woloski says Cracker Barrel should send all shareholders a corrected proxy statement and acknowledge its error.
Shares of Cracker Barrel (Ticker: CBRL) barely budged in Monday trading and are trading just under $67. Year to date, they're up more than 30 percent.