A Cracker Barrel board member who has drawn controversy over his DEI background has resigned, the company announced Thursday.
Upon announcing that shareholders voted to elect nine of the company’s 10 board nominees, including CEO Julie Felss Masino, during the annual meeting Thursday, Cracker Barrel revealed that following the vote, independent director Gilbert Dávila stepped down and the company’s board will now consist of nine directors.
“The Board and leadership team are honored to be trusted with the responsibility of stewarding Cracker Barrel and we take seriously the trust our shareholders and guests have placed in us,” read a statement from the board in part. “We also thank outgoing independent director, Gilbert Dávila, who has been a valued member of the Board through his five years of service to Cracker Barrel. Over that time, Gilbert helped oversee the formation of our strategic plan and led our Compensation Committee with skill and dedication. We are grateful for his many contributions.”
The company had urged shareholders to keep Dávila, who joined the board in 2020.
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The vote marks a partial win for activist investor Sardar Biglari, who called to oust both Masino and Dávila over his concerns about Cracker Barrel’s performance and its controversial August rebrand.
Biglari’s investment firm sent a letter to shareholders on Nov. 6 telling them that his campaign is “about saving Cracker Barrel from a board and management team that are out of touch with Cracker Barrel’s customer base.”
“The board has failed in every acquisition and in the opening of new stores, hired the wrong CEO, and approved a ‘Strategic Transformation Plan’ that has not only failed but has subjected the company to market ridicule and set the company back years in terms of its financial and stock price performance,” the letter read in part.
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Two major proxy advisory firms, Institutional Shareholder Services (ISS) and Glass Lewis, urged shareholders earlier this month to vote against one or more Cracker Barrel directors.
ISS and Glass Lewis advised shareholders to vote against Dávila, a marketing and diversity specialist who served as the chair of the compensation committee. Glass Lewis also recommended a vote against Jody Bilney, who chairs the company’s nominating and corporate governance committee.
Neither proxy firm recommended ousting the CEO.
Cracker Barrel said Biglari has launched eight proxy fights in 15 years and uses platforms tied to companies he controls, including Steak ’n Shake, to make “false and misleading statements.”
It accused Biglari of waging a “costly and distracting” proxy campaign to advance his own interests, saying he has a long history of “disruptive, failed campaigns” against the company.
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“Our Board and leadership team have great appreciation for Cracker Barrel’s place as the front porch of America and home to some of our country’s greatest attributes: family, hard work, scratch-made meals, and country hospitality,” the company said Thursday.
“We are more focused than ever on delivering high-quality food and experiences to our guests while staying true to the heritage that makes Cracker Barrel so special, ensuring we are here to welcome families around our table for generations to come. As always, we are committed to returning the Company to growth and enhancing value for our shareholders.”
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