Cracker Barrel Board Member Resigns After Proxy Fight
DEI consultant Gilbert Dávila has resigned from Cracker Barrel’s board following a heated proxy fight with activist investor Sardar Biglari. The company announced the departure after shareholders voted to retain nine of ten board nominees, including CEO Julie Felss Masino.
Key Developments
- Gilbert Dávila resigned immediately after the annual shareholder meeting
- Activist investor Sardar Biglari sought to oust both Dávila and CEO Masino
- Major proxy advisory firms ISS and Glass Lewis recommended voting against Dávila
- The board now consists of nine directors instead of ten
Board Statement and Background
In an official statement, the Cracker Barrel board acknowledged Dávila’s five years of service, noting he “helped oversee the formation of our strategic plan and led our Compensation Committee with skill and dedication.” Despite the company urging shareholders to retain him, Dávila stepped down following the vote.
Activist Investor’s Campaign
Sardar Biglari’s investment firm launched an aggressive campaign, claiming in a November 6 letter that his effort was “about saving Cracker Barrel from a board and management team that are out of touch with Cracker Barrel’s customer base.” The letter criticized the board’s performance, failed acquisitions, and what it called a disastrous strategic transformation plan.
Proxy Advisory Influence
Both Institutional Shareholder Services (ISS) and Glass Lewis advised shareholders to vote against Dávila, a marketing and diversity specialist who chaired the compensation committee. Glass Lewis also recommended voting against Jody Bilney, who leads the nominating and corporate governance committee. Notably, neither firm recommended ousting CEO Masino.
Company’s Response
Cracker Barrel defended its position, stating Biglari has launched eight proxy fights in 15 years and uses platforms including Steak ‘n Shake to spread “false and misleading statements.” The company characterized his campaign as “costly and distracting” with a history of “disruptive, failed campaigns.”
The company reaffirmed its commitment to Cracker Barrel’s heritage as “the front porch of America” while promising to return the company to growth and enhance shareholder value.
