Cracker Barrel Board Member Part Of Controversy Has Resigned

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00:00Cracker Barrel Board Member Part of Controversy Has Resigned

00:04Cracker Barrel's Board of Directors has undergone a shake-up after its annual shareholder meeting on Thursday,

00:10resulting in the resignation of Board Member Gilbert Davila.

00:13Davila, who joined the Board in 2020 and has a background in diversity, equity, and inclusion,

00:19stepped down after shareholders approved nine of the company's ten nominated directors,

00:23leaving him as the only nominee who did not secure re-election.

00:27Davila had been under scrutiny in recent months, largely due to criticism from activist investor Sardar Biglari.

00:34Biglari has long argued that Cracker Barrel's leadership is disconnected from its customer base

00:39and has blamed recent strategic decisions for damaging the company's financial performance and reputation.

00:46He urged shareholders to vote against both Davila and CEO Julie Fels-Massino

00:50as part of a broader effort to challenge the company's direction.

00:53While Massino retained her board seat, Davila did not.

00:57Following the vote, he resigned, bringing the board down to nine members.

01:01Cracker Barrel publicly thanked him for his five years of service and his work on strategic planning and compensation matters.

01:09Biglari is seen as having scored at least a partial victory.

01:13In a November 6 letter to shareholders, he argued that Cracker Barrel had suffered from poor acquisitions,

01:19weak store openings, and a failed transformation plan that damaged the brand and attracted market ridicule.

01:26His concerns were echoed by proxy advisory firms ISS and Glass-Lewis,

01:31both of which recommended voting against Davila due to concerns over recent strategic missteps.

01:36Glass-Lewis also recommended a vote against Jody Bilney, head of the nominating and corporate governance committee.

01:42However, neither firm supported removing Massino.

01:46Cracker Barrel defended its leadership, accusing Biglari of running yet another costly and distracting proxy campaign,

01:54the eighth in 15 years, and of making misleading statements through his ties to outside companies.

01:59Despite the turmoil, the company emphasized its commitment to its core identity

02:04and said it remains focused on guest experience, growth, and improving shareholder value.

02:10Whether this board shake-up will help restore investor and customer confidence remains uncertain.