PART
III.
ITEM
10
.
DIRECTORS,
EXECUTIVE
OFFICERS AND CORPORATE GOVERNANCE
Executive
Officers
The
information required by this item with respect to our executive officers
is
incorporated herein by reference to the information included under
the caption
“Executive Officers of the Registrant” in Part I, Item 1 of the Original
Filing.
Directors
Our
Board of
Directors currently consists of nine members, each of whom is elected to
serve one year, or until his or her successor is duly chosen and
qualified, or
until he or she resigns or is removed.
The
members of our Board of Directors are listed below, along with the age,
tenure as director and business background for at least the last
five years for
each. There are no family relationships, of first cousin or closer, among
our directors and executive officers by blood, marriage, or
adoption.
Name
|
Age
|
Director
Since
|
Business
Experience
|
Sardar
Biglari
|
31
|
2008
|
Chairman
and Chief Executive Officer of the Company; Chairman
and Chief Executive
Officer of Biglari Capital, the general partner of the Lion Fund,
L.P. (“Lion Fund”), a private investment fund, since its inception in
2000. He has also served as the Chairman of the Board of Western
Sizzlin Corp. (“Western Sizzlin”), a steak and buffet restaurant chain
operating and franchising restaurants, since March 2006
and as its Chief
Executive Officer and President since May
2007.
|
|
|
|
|
Philip
Cooley
|
65
|
2008
|
Prassel
Distinguished Professor of Business at Trinity University,
San Antonio,
Texas, since 1985. Served as an advisory director of Biglari Capital
since 2000 and as Vice Chairman of the Board of Western Sizzlin since
March 2006; Director of the Consumer Credit Counseling
Service of Greater
San Antonio and the Financial Management Association
and the Eastern
Finance Association.
|
|
|
|
|
Wayne
L.
Kelley
|
64
|
2003
|
Private
Investor;
Interim Chairman of the Company from March 2008 to June
2008; Interim
Chief Executive Officer of the Company from March 2008
to August 2008;
Director of Steak n Shake Operations, Inc., a subsidiary
of the Company,
from 1999 through 2006; President of Kelley Restaurants, Inc.,
the Company's largest franchisee, from 1988 through
2005.
|
|
|
|
|
Ruth
J.
Person
|
63
|
2002
|
Chancellor
and
Professor of Management, University of Michigan-Flint;
Former Chancellor,
Indiana University Kokomo and Professor of Management
from 1999 through
2008; President, American Association of University Administrators
2003
through 2004; Former President, Board of Directors, Workforce
Development
Strategies, Inc.; Former Member, Key Bank Advisory Board
– Central
Indiana.
|
|
|
|
|
William
J. Regan,
Jr.
|
62
|
2008
|
Private
Investor;
Chief Financial Officer, California Independent System
Operator
Corporation from June 1999 until retirement in April
2008; Director of the
Consumer Credit Counseling Service of Greater San Antonio. Formerly
held senior financial positions at Entergy Corporation,
United Services
Automobile Association (USAA), and American Natural Resources.
|
J.
Fred Risk
|
80
|
1971
|
Private
investor; Chairman of the Board of Directors of Security
Group,
Inc.
|
|
|
|
|
John
W. Ryan
|
79
|
1996
|
Private
investor; Chancellor of the State University of New York
Systems from 1996
through 1999; President of Indiana University from 1971
through
1987.
|
|
|
|
|
Steven
M. Schmidt
|
54
|
2005
|
President,
Business Solutions Division - Office Depot; formerly,
President & CEO,
ACNielsen; EVP, VNU Marketing Information New York, NY;
formerly President
of Pillsbury Foods, Canada; also held senior executive
posts with
Pepsi-Cola and Procter & Gamble.
|
|
|
|
|
Edward
W. Wilhelm
|
50
|
2006
|
Consultant;
formerly Chief Financial Officer of Borders Group, Inc.
through January 5,
2009; held a number of senior financial positions at
Borders Group, Inc.
since 1994.
|
Section
16(A) Beneficial Ownership Reporting Compliance
Section
16(a)
of the Securities Exchange Act of 1934, as amended (the “Exchange
Act”) sets forth certain filing requirements relating to securities
ownership by directors, executive officers and ten percent shareholders
of a
publicly held company. To the Company’s knowledge, based on the
representations of its directors and executive officers and copies
of their
respective reports filed with the SEC, all filing requirements were
satisfied by
each such person during the fiscal year ended September 24,
2008.
Code
of Business Conduct and Ethics
The
Company
has a long-standing code of ethics which
applies to its principal executive officer
, principal financial officer
and principal
accounting officer, as well as all officers, directors and employees. A
copy of the
Code of Business Conduct
and Ethics can be obtained without charge on the Company’s web site (
www.steaknshake.com
)
or by written request to the Company at the address on the front
page of this
Form 10-K/A. If the Company makes any substantive amendment to, or grants
any
waiver of a provision of
the
code, the Company will disclose the nature of such amendment or waiver
via its
web site or in a current report on Form 8-K.
Changes
to Procedures for Shareholders to Nominate Persons for Election to
the Board of
Directors
There
were no material changes made during fiscal 2008 to the procedures
by which
shareholders may recommend nominees to our Board of
Directors.
Audit
Committee Matters
The
Board of Directors maintains a standing audit committee established
in
accordance with Section 3(a)(58)(A) of the Exchange Act, as amended, and
the listing rules of the New York Stock Exchange. The Board of Directors
has determined that the members of the committee, Messrs. Wilhelm
and Risk
and Dr. Cooley, are independent under the listing rules of the New
York Stock
Exchange and qualify as “audit committee financial experts” as that term is
defined in Item 407(d)(5)(ii) of Regulation S-K.
ITEM
11
.
EXECUTIVE
COMPENSATION
COMPENSATION
DISCUSSION AND ANALYSIS
Introduction
This
Compensation Discussion and
Analysis is designed to provide shareholders with
a
better
understanding
of
our compensation
philosophy, core principles, and decision making process. It
explains
the
c
ompensation
-related
actions
taken
with
respect to
the
executive
officers who are identified in the Summary Compensation Table (the
“Named
Executive Officers”).
Details
regarding
the compensation we paid to the Named Executive Officers for fiscal
2008 are
found in the tables and narrative which follows
them.
What
you will read
below reflects decisions, philosophy and executive compensation
which were
determined by a prior composition of the Compensation Committee. The
current Compensation Committee is reevaluating its compensation
philosophy to
ensure that executive compensation is aligned with the Company’s objective of
maximizing its per-share intrinsic business value. We will communicate
modifications to our compensation system as soon as
practicable.
Executive
Compensation Philosophy
Our
long-term success
depends on our
ab
ility
to operate
effectively
and
efficiently
,
offer
appealing
products
and
outstanding
service for our customers and invest
wisely
for present
and future success.
To
achieve these
goals,
we
must
attract,
motivate,
and retain highly talented individuals at all levels of the organization.
The
Compensation
Committee strives to provide compensation which is appropriate to
attract and
retain such individuals.
All
decisions
relating to the compensation of the
Named
Executive
Officers
are
made by the
Compensation Committee in executive session, without management
present. In assessing the compensation of the Chief Executive
Officer, the Compensation Committee
makes
a qualitative
assessment of our
performance,
his
contribution to that performance,
his
expected
performance in the future,
and
other factors
(including tenure and exp
erience,
retention
concerns,
historical
compensation
and
the
relationship of his compensation to other executives in the Company
).
In
evaluating
the performance of other executive officers, the
Compensation
Committee
considers
the
evaluations provided by the Chief Executive Officer, the Company’s performance,
individual performance, department performance and other criteria
that the
Committee believes to be indicative of performance
.
As
a general matter,
over 50% of targeted annual compensation to executive officers takes
the
form of performance-dependent, incentive
cash
and equity
programs
.
We
believe that
putting a significant portion of compensation at risk provides an
incentive to
perform at the highest level and more closely aligns the executives’ perspective
with that of our shareholders.
As
part of making any
compensation decision, the Compensation Committee
reviews
market
compensation levels for executive officers at
other
restaurant
companies (for positions that are unique to our industry) or similarly-sized
companies (for
other
positions)
to
determine whether the compensation components for our executive officers
remain
in the targeted ranges described
in
the following
paragraph.
With
the assistance
of our Human Resources department and with information obtained from
a third
party compensation consultant
,
management
collects and presents compensation data for
our
executive
officers
,
including the
Named
Executive O
fficers. Information
regarding
the
restaurant
industry was obtained from the Chain Restaurant Compensation Association
and
the
Committee’s consultant. I
nformation
regarding
the
compensation
for
executives at similarly-sized companies is obtained from the
Committee’s
consultant
and from
published
compensation
surveys. The c
ompensation
surveys
provide
data
on
pay
practices
for
executive position
s
at
companies
with
similar
revenue
size
,
although they do
not provide names of the reported companies
. The
compensation assessment
that
is presented
to the Compensation Committee
includes
an
evaluation of base salary, target annual incentive opportunities,
long-term
incentive grant values
,
and benefits for
each executive o
fficer
relative to
similar positions in the market.
The
Compensation Committee
sets total targeted compensation for executives who hold positions
unique to the
restaurant industry (such as EVP of Operations)
between
the
50
th
and
75
th
percentiles
of
a
set of restaurant companies of similar
size
. For
other
executive
positions
,
where
both
restaurant and general industry pay levels are rele
vant
for staffing
and retention (such as Chief Financial Officer), the Compensation
Committee sets
targeted total compensation
t
he
50
th
and
75
th
percentiles
of
comparable restaurant companies and t
he
50
th
percentile
of
non-restaurant
companies
of
a
similar revenue size.
The
Committee
may vary
from these percentiles
based
on such
factors as
historic
compensation,
individual
skills,
experience, contribution and performance, internal equity,
retention
concerns
and other factors
relevant
to the
individual executive.
In
addition, actual
compensation (e.g., amounts earned and paid each year) may be higher
or lower
than
targeted total compensation based on our performance or the assessment
of the
executive’s performance
.
Components
of Total Compensation
Base
Salary
We
believe
b
ase
salaries should
be
set at a level
sufficient to attract
and
ret
ain
the
executive
talent
needed to run our business. The Compensation Committee sets base
salaries
at
market median
levels
for
positions that
are unique to the restaurant industry, and between the 50
th
and
75
th
percentile
in the
restaurant industry for other executive
positions.
In
setting
base
salaries for
fiscal
2008, the Compensation C
ommittee
considered the following
factors:
·
|
Internal
analysis.
This
is the relative
pay difference for different job levels within the
Company.
|
|
|
·
|
Individual
performance.
I
ncreases
to
base
salaries can
result
from
individual performance assessments
as
well as an
evaluation of the market and the mix among various components
of
compensation.
In
setting
the
salary for Mr. Gilman, the Committee retained his predecessor’s salary,
which was unchanged from the prior year as a result of our
disappointing
performance. In setting the salary for Mr. Kelley, the
Committee balanced his extensive experience with the Company
against the
interim nature of his appointment. In setting Mr. Biglari’s
salary, the Committee considered his recent involvement with
the Company
and his significant equity stake in the Company. In fiscal 2008
all of our Chief Executive Officers’ base salaries were below the
50
th
percentile
for chief executive officers of similarly sized companies
in the
restaurant industry and generally based on information available
to the
Committee
.
The
Compensation
C
ommittee
also
reviewed
the
performance of the other Named E
xecutive
Officers,
ultimately concluding that, while their individual performances
had been
satisfactory, our overall disappointing performance in fiscal
2008 did not
warrant an increase in base salaries. The Committee believed
that their equity compensation would provide an appropriate
incentive to
improve our performance and reward them for success in their
roles. A discussion of the mix between the two components of
equity compensation is in the “Long-Term Incentives” section
below
.
|
·
|
Market
data
.
As
noted
above, while the
Compensation Committee uses
industry
and general market data
to test for
the
reasonableness
and
competitiveness of base salaries,
Committee
members exercise
subjective
judgment
within
the ranges in
this data
in
view of
our
compensation
objectives
and
individual
performance and circumstances
.
|
Annual
Incentive
Bonus
For
fiscal 2008 the
Compensation
Committee
intentionally
allocate
d
a greater portion of targeted total
compensation
to the
performance-
dependent
elements
.
One
way in which it did this was
to set what it believed to be aggressive, but reachable, targets
for fiscal 2008
under our Incentive Bonus Plan.
Over
100 employees,
including the Named Executive Officers, participated in the Incentive
Bonus Plan
in fiscal 2008. The
Compensation
Committee
establishe
d
a
target incentiv
e opportunity
for each participant,
expressed as
a percent of
base salary.
The
Named Executive Officers had target bonus opportunities set at 30%
- 70% of
their base salaries.
For the Named
Executive Officers,
th
e target annual
incentives for fiscal 2008
were as follows:
|
Target
Bonus
Incentive
as
a
% of
Base
Salary
|
Mr.
Biglari
|
0%
a
|
Mr.
Gilman
|
70%
|
Mr.
Kelley
|
0%
a
|
Mr.
Blade
|
4
0%
|
Mr.
Geiger
|
30%
|
Mr.
Janjua
|
40%
|
Mr.
Milne
|
30%
|
Mr.
Schiller
|
35%
|
Mr.
Murrill
|
40
%
|
a
Messrs.
Biglari and Kelley did not
participate in the Company's Incentive Bonus Plan in fiscal 2008.
To
arrive at a payout
number
under the Incentive
Bonus Plan
, the target
bonus opportunity
for
each
participant
is
multiplied by
a formula based on
our performance
as
determined by targets for objective performance and measures and
individual performance
goals.
In fiscal 2008
the
corporate performance measures were growth in earnings before interest
and taxes
(“EBIT”) and same store sales over the prior year. Individual performance
was based on the successful completion of defined projects during the
fiscal
year. The individual performance modifier may
result in further
modification of the
payout
, since any
u
pward adjustment
for one participant
must be offset
by downward
adjustments for other
s
.
T
he
formula used to compute bonus payouts
is set forth below:
Target
Bonus
Amount
|
X
|
Corporate
Performance
Modifier
(0%
- 250
%)
|
X
|
Individual
Performance
Modifier
(
75
%
-
125
%)
|
After
the end of the
fiscal
year, the
Compensation Committee evaluates
the Company’s performance
against
the
specific
targets set at the beginning of
the year and modifi
es the
bonus payout to 0% to 250
%
of the target.
For
fiscal 2008, the targets for growth in
EBIT and same
store
sales
were as
follows:
|
Threshold
(0%)
|
Target
(100%)
|
Maximum
(250%)
|
Same
Store
Sales
|
-3.5
%
|
-2.0
%
|
0.0
%
|
EBIT
|
$28.9M
|
$29.6M
|
$31.1M
|
In
fiscal 2008, we
did not achieve
the targets
at
the threshold level for
either the same
store sales or EBIT
performance measures
.
Consequently,
we
made no payments under the Incentive
Bonus Plan to any participant in fiscal 2008.
Long-Term
Incentives
E
quity-ba
sed
incentives are
a significant
element of total executive
officer compensation, as we believe these forms of compensation align
the
interests of executives with those of our shareholders
for periods
greater than the single year
focus of the Incentive Bonus Plan
.
They
also encourage
retention
of
employees
. These
equity-based
incentives
consist of
stock options
and
restricted
stock.
In
making
equity-based awards
, the Compensation
Committee also
considers
the executive’s
level
of responsibility,
prior experience,
internal
equity, retention concerns, individual performance
,
and
market
data for
the particular
position. The
Committee uses the value of these incentives as determined by accounting
principles to provide
targeted
total
compensation
at the
levels
discussed
above. I
f our
shareholder returns exceed industry
averages, our
executives’ compensation
will likewise
exceed
industry
averages. Likewise, if
our
shareholders do not realize competitive returns on their investments,
our
executives’ compensation will fall below the industry
average.
Stock
Options
Stock
options reward
the recipient
for
the increase i
n our stock
price during
the holding
period. Options
represent the high-risk and potential high-return component of our
total
long-term incentive program, as the potential value of each option
can fall to
zero if the price
of our
stock
is lower than
the
exercise price when the options expire.
The
size of stock
option grants for executive officers is based primarily on the target
dollar
value of the award, translated into a number of option shares based
on the
estimated economic value of the award, as determined using the Black-Scholes
option pricing formula. The number of shares underlying stock option
awards will typically vary from year to year, as it is dependent
on the price of
our
stock.
Subject
to limits imposed by
Section 422 of the Internal Revenue Code, options granted to all
employees
are
incentive stock options.
In
April
2008
, the Compensation
Committee approved
annual grants of stock options to each of the Named Executive
Officers. These options had an exercise price equal to the market
value of
our stock on
the
date of grant. They were granted under the
200
8
Equity Incentive Plan
, which was
approved by our
shareholders
in March
2008. These options vest over four
years
,
at
a rate of 25% per year, beginning on
the
first anniversary
of
the grant. Th
ey
expire ten years from the date of grant
.
See
“Grants
of Plan-Based
Awards.”
We
do not backdate
options or grant options or other equity awards retroactively. In
addition, we do not purposely schedule option awards or other equity
grants
prior to the disclosure
of
favorable information or after the announcement of unfavorable
information. In general,
equity-based
inc
entive
awards are made
during the
Board meeting
held in conjunction
with the annual
meeting, with mid-year grants limited to newly hired or promoted
employees
.
Restricted
Stock
R
estricted
stock awards provide the
recipient with shares of
our
stock,
which
the
recipient
may
v
ote
and
for which he may
receive dividends
during
the vesting period
. The recipient
may not
transfer or assign the restricted shares for a period after the date
of grant,
however, and if the recipient ceases to be
our
employee
for any reason other than
death, disability or retirement during t
hat period
the shares will be
forfeited
.
The
restriction on transfer is
generally three (3) years, although some new hires have received
shares with a
shorter period of restriction.
If the recipient
ceases being
our
employee
during the vest
ing period
as a result of retirement,
death or
disability
then
the recipient (or his/her estate) will receive a
pro
rata
amount of shares
reflective
of the percent of the vesting period during which the recipient was
employed.
Perquisites
The
current perquisites
provided to executive officers include: (i) amounts we pay to group life
insurance premiums for coverage in excess of $50,000, and (ii) personal use
of a company car. In fiscal 2008 we also provided a medical
reimbursement plan which provided officers with up to $3,500 in
reimbursement
for otherwise unreimbursed medical costs each year, a plan which
reimbursed
officers for 75% of their tax preparation costs up to a total benefit
of $1,250
and a Company matching contribution of 50% of up to 6% of the officer’s
compensation contributed into the 401(k) Plan and deferred into
the Deferred
Compensation Plan. One officer also received a one-time payment for
relocation expenses.
These
programs have been discontinued in fiscal 2009 with the matching
contribution
being suspended until the Company returns to profitability.
See
footnote
(c) to the Summary Compensation Table below for the perquisites
provided to each
Named Executive Officer in fiscal 2008.
Our
executive officers also
receive the benefits provided to all employees, subject to satisfying
the
requirements for participation. These benefits include: participation in
the 401(k) Plan, life insurance equal to their annual salary, group
medical & dental plans, short-
and
long-term disability insurance, and a lunch discount of 50% at Steak
n Shake
restaurants on work days. The executive officers are also entitled to
participate in the Company's Deferred Compensation Plan, a plan which
is only
open to those who are “highly compensated” under IRS
regulations.
Employment
Agreements, Severance, and Change-in-Control
Arrangements
Employment
Agreements
We
currently have
entered into employment agreements with three of the Named Executive
Officers,
Messrs. Geiger, Janjua and Milne. These a
greements
(the
“Employment
Agreements”) provide
for the payment of benefits in the event their employment is terminated
without
cause or in the event they terminate their employment with good reason at
any time. In establishing the benefits to be provided under the
Employment Agreements, the Committee obtained benchmarking information
from its
compensation consultant, considered which individuals were vital
to retain and
evaluated the potential costs and benefits of the Employment
Agreements.
The
primary terms of
the Employment Agreements are provided below
:
·
|
Stay
Payment.
If
a
Change in Control (as defined in the Employment Agreements)
had occurred
prior to November 7, 2008, the employee would have received a
payment in an amount equal to 30% of his base
salary.
|
|
|
·
|
Termination
Following Change in Control.
In
the event that the employment
of the employee is terminated within
one
year of
a change
in control by us without
“cause”
(as
defined
in the Employment Agreements) or
by
the employee for the reasons
set forth in Section 4 of the Employment Agreements (“good
reason”), he will receive: (a) a lump-sum
severance
payment
equal
to one year of his
base
salary
,
(b)
c
overage
under
the
group
medical
plan for one year,
(c)
use
of his
Company
-provided
car
for
up to 60
days
, (d)
a
lump-sum
payment
of a pro rata amount of the annual incentive bonus
to
which he wo
uld
have been entitled had he
been
employed
through
the
appl
icable
bonus
computation period, and (e) reimbursement of up to $15,000
for
outplacement
services.
|
·
|
Termination
Without Cause or Separation with Good Reason.
Should
we terminate the employee without cause,
or should the individual decide to separate with good reason
at any time
then he will receive: (a) his normal
gross salary,
payable for one year; this amount
will be reduced by the amount of the compensation earned
in any subsequent
employment; (b) a lump-sum
payment
equal to the
pro
rata
portion of the
annual incentive bonus reflective of the number of days
in the year the
individual was employed; (c) continued use of his Company
owned automobile
for up to 60 days following separation or until provided
with an
automobile by a subsequent employer; (d) continued participation
in any
Company-provided group medical insurance plan for up to
one year, or until
provided benefits by a subsequent employer; and (e) up
to $15,000 for
outplacement services.
|
|
|
·
|
Executive’s
Obligations
.
Prior
to obtaining any
benefits under an Employment Agreement, the employee must waive any
claims against us and agree to keep confidential our confidential
information and business secrets. The employee also must agree not
to solicit any of our employees for one year following termination.
We may recover any benefits paid under the Employment Agreements if
the employee breaches any of his obligations under
the Employment
Agreements.
|
Effect
of a Change in
Control, Death, Disability or Retirement on Equity
Grants
In
the
event of the death of an option recipient, then his/her estate may
exercise the
option in full at any time prior to its expiration. In the event of
an option recipient's retirement, he/she may exercise any vested
options within
three months form the date of retirement. Should an option
recipient's employment end as a result of a disability, then he/she
would be
able to exercise the options as if the recipient had remained with
the Company
through (i) cessation of payments under a disability pay plan of
the Company,
(ii) the recipient's death, or (iii) the recipient's 65th
birthday.
All
prior restricted
stock plans, the 2006 Steak n Shake Employee Stock Option Plan and
the 2008
Equity Incentive Plan
contain
provisions
that accelerate the vesting
of the awards upon
a change
in control
.
Options
granted under prior
stock option plans may be accelerated upon a change in control at
the discretion
of the Board of Directors.
The
number of
unvested shares that would vest on a change in control, and the value
of those
shares as of the end of the fiscal year, is set forth in the table
below
entitled “Outstanding
Equity Awards
at Fiscal Year
End
” under the column
entitled “
Number of
Shares
or Units of Stock
that Have Not Vested
.
”
Deductibility
Cap on Executive Compensation
Section
162(m) of the
Internal Revenue Code
prohibits
publicly-held
companies
from taking
a tax deduction for certain
compensation paid
in excess
of $1 million to the Chief Executive Officer and each of the three other
most highly compensated executive officers (other than the Chief
Financial
Officer)
.
P
erformance-based
compensation
remains
deductible
. To
qualify as
performance-based compensation,
the program
under
which it is provided must be
approved by
shareholders
and meet other requirements.
Our policy
is, where feasible, to
attempt to qualify our compensation plans for full
deductibility. Pursuant to that policy, we have
taken steps
to qualify compensation
under our
Incentive Bonus
Plan and
all equity
plans that provide for the issuance of
stock option
s
as
“perfor
mance-based
compensation.”
We
may
make payments that are not fully
deductible if, in
the
judgment
of
the Compensation
Committee
, such payments
are
otherwise
ne
cessary
to achieve
compensation
objectives
. In fiscal 2008
we did not
pay compensation that was not deductible under Section
162(m).
Summary
Compensation
Information
The
following table shows the compensation paid to the three individuals
who served
as Chief Executive Officer during fiscal 2008, the two individuals
who served as
Chief Financial Officer, the other two most highly compensated executive
officers who received total compensation of over $100,000 in fiscal
2008 and two
former executive officers who would have been among the three most
highly
compensated employees had they been employed at the end of fiscal 2008
(the
“Named Executive Officers”).
SUMMARY
COMPENSATION TABLE
Name
and Principal
Position
|
Fiscal
Year
|
|
Salary
|
|
Stock
Awards
a
|
|
|
Option
Awards
b
|
|
|
All
Other
Compensation
c
|
|
|
Total
|
|
Sardar
Biglari,
Chairman
and Chief
Executive Officer
|
2008
|
|
$
|
30,105
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
14,535
|
|
|
$
|
44,640
|
|
Alan
Gilman
,
Former
Chairman,
Former Interim President
and Chief Executive Officer
|
2008
|
|
$
|
334,615
|
|
$
|
(12,903
|
)
d
|
|
$
|
(27,672
|
)
d
|
|
$
|
280,631
|
|
|
$
|
574,671
|
|
|
2007
|
|
$
|
331,731
|
|
$
|
12,903
|
|
|
$
|
308,078
|
|
|
$
|
26,547
|
|
|
$
|
679,259
|
|
Wayne
Kelley,
Former
Interim Chairman and Chief Executive Officer
|
2008
|
|
$
|
127,307
|
|
$
|
—
|
|
|
$
|
2,023
|
|
|
$
|
12,047
|
|
|
$
|
141,377
|
|
Jeff
Blade,
Former EVP, Chief Financial
Officer, Chief Administrative Officer and Interim President
|
2008
|
|
$
|
293,227
|
|
$
|
(138,337
|
)
e
|
|
$
|
14,829
|
e
|
|
$
|
372,832
|
|
|
$
|
542,551
|
|
|
2007
|
|
$
|
305,885
|
|
$
|
163,536
|
|
|
$
|
85,341
|
|
|
$
|
18,250
|
|
|
$
|
573,012
|
|
Duane
Geiger,
Interim Chief Financial
Officer, Vice President, Controller
|
2008
|
|
$
|
187,500
|
|
$
|
64,762
|
|
|
$
|
65,528
|
|
|
$
|
15,992
|
|
|
$
|
333,782
|
|
|
2007
|
|
$
|
185,596
|
|
$
|
74,426
|
|
|
$
|
48,910
|
|
|
$
|
15,455
|
|
|
$
|
324,387
|
|
Omar
Janjua,
Executive Vice President,
Chief Operating Officer
|
2008
|
|
$
|
300,000
|
|
$
|
100,374
|
|
|
$
|
49,769
|
|
|
$
|
50,836
|
|
|
$
|
500,979
|
|
David
Milne,
Vice President, General
Counsel, Corporate Secretary
|
2008
|
|
$
|
209,796
|
|
$
|
71,744
|
|
|
$
|
42,294
|
|
|
$
|
17,796
|
|
|
$
|
341,630
|
|
Steven
Schiller,
Former Senior Vice
President, Chief Marketing Officer
|
2008
|
|
$
|
237,692
|
|
$
|
(41,077
|
)
f
|
|
$
|
11,931
|
f
|
|
$
|
244,503
|
|
|
$
|
453,049
|
|
|
2007
|
|
$
|
254,903
|
|
$
|
122,320
|
|
|
$
|
45,271
|
|
|
$
|
17,780
|
|
|
$
|
440,274
|
|
Tom
Murrill,
Former Senior Vice
President, Human Resources
|
2008
|
|
$
|
260,000
|
|
$
|
—
|
g
|
|
$
|
92,379
|
g
|
|
$
|
7,086
|
|
|
$
|
359,465
|
|
a.
|
Represents
the
dollar
amount of equity
compensation cost recognized for financial reporting purposes
with respect
to
stock
awards in
f
iscal
2008, computed
in accordance with SFAS 123
(R)
,
excluding the impact of
estimated forfeitures for service-based vesting conditions
, as
follows:
|
Name
|
Date
of Grant
|
|
No.
of Shares
|
|
Fiscal
2008 Expense
|
|
Mr.
Gilman
|
8/17/07
|
|
17,000
|
|
$
|
(12,903
|
)
|
Total
|
|
|
|
|
|
$
|
(12,903
|
)
|
|
|
|
|
|
|
|
|
|
Mr.
Blade
|
10/4/04
|
|
8,500
|
|
$
|
—
|
|
|
9/14/05
|
|
3,000
|
|
|
(19,750
|
)
|
|
2/8/06
|
|
12,000
|
|
|
(69,880
|
)
|
|
2/6/07
|
|
13,400
|
|
|
(48,707
|
)
|
|
4/12/08
|
|
30,300
|
|
|
—
|
|
Total
|
|
|
|
|
|
$
|
(138,337
|
)
|
|
|
|
|
|
|
|
|
|
Mr.
Geiger
|
10/4/04
|
|
5,500
|
|
$
|
—
|
|
|
2/8/06
|
|
4,400
|
|
|
25,623
|
|
|
2/6/07
|
|
4,600
|
|
|
27,171
|
|
|
4/12/08
|
|
10,400
|
|
|
11,968
|
|
Total
|
|
|
|
|
|
$
|
64,762
|
|
|
|
|
|
|
|
|
|
|
Mr.
Janjua
|
6/13/07
|
|
15,400
|
|
$
|
77,359
|
|
|
4/12/08
|
|
20,000
|
|
|
23,015
|
|
Total
|
|
|
|
|
|
$
|
100,374
|
|
|
|
|
|
|
|
|
|
|
Mr.
Milne
|
10/4/04
|
|
4,000
|
|
$
|
—
|
|
|
2/8/06
|
|
4,100
|
|
|
23,876
|
|
|
2/6/07
|
|
4,200
|
|
|
24,808
|
|
|
5/8/07
|
|
1,200
|
|
|
6,604
|
|
|
4/12/08
|
|
14,300
|
|
|
16,456
|
|
Total
|
|
|
|
|
|
$
|
71,744
|
|
|
|
|
|
|
|
|
|
|
Mr.
Schiller
|
5/11/05
|
|
8,000
|
|
$
|
30,950
|
|
|
2/8/06
|
|
7,500
|
|
|
(43,675
|
)
|
|
2/6/07
|
|
7,800
|
|
|
(28,352
|
)
|
|
4/12/08
|
|
17,500
|
|
|
—
|
|
Total
|
|
|
|
|
|
$
|
(41,077
|
)
|
|
|
|
|
|
|
|
|
Mr.
Murrill
|
4/23/07
|
|
6,4
00
|
|
$
|
(16,581
|
)
|
|
4/12/08
|
|
13,900
|
|
|
—
|
|
Total
|
|
|
|
|
|
$
|
(16,581
|
)
|
Negative
numbers
reflect the benefit the Company realized when these grants were forfeited
upon
the officer's departure from the Company during fiscal 2008. See Note 15
of Notes to Consolidated Financial Statements included in Part II,
Item 8 of the Original Filing
for
a description of
the
assumptions
made in the
valuation
.
The
actual
value realized by the Named Executive Officer with respect to stock
awards will
depend on the market value of
our
stock
on
the date the
restricted stock vests, as well as the date on which the stock is subsequently
sold.
b.
|
Represents
the dollar amount of equity compensation cost recognized
for financial
reporting purposes with respect to stock option awards in
fiscal 2008,
computed in accordance with SFAS 123(R), excluding the impact of
estimated forfeitures for service-based vesting conditions,
as
follows:
|
Name
|
Date
of Grant
|
|
No.
of Shares
Underlying
Options
|
|
Fiscal
2008 Expense
|
|
Mr.
Gilman
|
8/4/04
|
|
25,000
|
|
$
|
(7,788
|
)
|
|
9/14/05
|
|
25,000
|
|
|
(17,996
|
)
|
|
5/8/07
|
|
5,000
|
|
|
(1,888
|
)
|
|
5/15/07
|
|
23,787
|
|
|
—
|
|
|
8/17/07
|
|
26,900
|
|
|
—
|
|
Total
|
|
|
|
|
|
$
|
(27,672
|
)
|
|
|
|
|
|
|
|
|
|
Mr.
Kelley
|
5/9/99
|
|
8,250
|
|
$
|
—
|
|
|
11/12/03
|
|
5,000
|
|
|
218
|
|
|
12/1/03
|
|
7,247
|
|
|
—
|
|
|
11/18/04
|
|
5,000
|
|
|
1,805
|
|
Total
|
|
|
|
|
|
$
|
2,023
|
|
|
|
|
|
|
|
|
|
|
Mr.
Blade
|
3/15/04
|
|
12,000
|
|
$
|
1,939
|
|
|
9/14/05
|
|
16,500
|
|
|
(11,877
|
)
|
|
2/8/06
|
|
20,200
|
|
|
11,697
|
|
|
2/6/07
|
|
21,300
|
|
|
13,070
|
|
|
4/12/08
|
|
48,100
|
|
|
—
|
|
Total
|
|
|
|
|
|
$
|
14,829
|
|
|
|
|
|
|
|
|
|
|
Mr.
Geiger
|
5/6/99
|
|
3,300
|
|
$
|
—
|
|
|
10/11/03
|
|
1,339
|
|
|
—
|
|
|
8/4/04
|
|
7,500
|
|
|
1,966
|
|
|
9/14/05
|
|
4,000
|
|
|
2,811
|
|
|
2/8/06
|
|
7,500
|
|
|
12,255
|
|
|
9/29/06
|
|
4,036
|
|
|
—
|
|
|
2/6/07
|
|
7,300
|
|
|
12,639
|
|
|
5/11/07
|
|
6,982
|
|
|
27,859
|
|
|
4/12/08
|
|
16,400
|
|
|
7,998
|
|
Total
|
|
|
|
|
|
$
|
65,528
|
|
|
|
|
|
|
|
|
|
|
Mr.
Janjua
|
6/13/07
|
|
24,400
|
|
$
|
34,310
|
|
|
4/12/08
|
|
31,700
|
|
|
15,459
|
|
Total
|
|
|
|
|
|
$
|
49,769
|
|
|
|
|
|
|
|
|
|
|
Mr.
Milne
|
8/4/04
|
|
5,000
|
|
$
|
1,311
|
|
|
2/21/05
|
|
1,574
|
|
|
—
|
|
|
9/14/05
|
|
6,000
|
|
|
4,216
|
|
|
2/8/06
|
|
6,900
|
|
|
11,275
|
|
|
9/29/06
|
|
288
|
|
|
—
|
|
|
2/6/07
|
|
6,700
|
|
|
11,600
|
|
|
5/8/07
|
|
1,800
|
|
|
2,773
|
|
|
5/11/07
|
|
1,954
|
|
|
—
|
|
|
4/12/08
|
|
22,800
|
|
|
11,119
|
|
Total
|
|
|
|
|
|
$
|
42,294
|
|
|
|
|
|
|
|
|
|
|
Mr.
Schiller
|
5/11/05
|
|
10,000
|
|
$
|
(2,970
|
)
|
|
2/8/06
|
|
12,700
|
|
|
7,354
|
|
|
2/6/07
|
|
12,300
|
|
|
7,547
|
|
|
4/12/08
|
|
27,800
|
|
|
—
|
|
Total
|
|
|
|
|
|
$
|
11,931
|
|
|
|
|
|
|
|
|
|
Mr.
Murrill
|
4/23/07
|
|
10,200
|
|
$
|
—
|
|
|
4/12/08
|
|
22,100
|
|
|
92,379
|
|
Total
|
|
|
|
|
|
$
|
92,379
|
|
Negative
numbers reflect the benefit the Company realized when these grants
were
forfeited upon the officer's departure from the Company during fiscal
2008. See Note 15 of Notes to Consolidated Financial Statements included
in Part II, Item 8 of the Original Filing for a description
of the assumptions made in the valuation. The actual value realized by the
Named Executive Officer with respect to option awards will depend on
the
difference between the market value of our stock on the date the option
is
exercised and the exercise price.
c.
|
The
type and amount of the components of the figures in the “All Other
Compensation” column above for fiscal year 2008 are as
follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mr.
Biglari
|
|
Mr.
Gilman
|
|
Mr.
Kelley
|
|
Mr.
Blade
|
|
Mr.
Geiger
|
|
Mr.
Janjua
|
|
Mr.
Milne
|
|
Mr.
Schiller
|
|
Mr.
Murrill
|
|
401(k)
matching
contributions
|
|
$
|
—
|
|
$
|
1,285
|
|
$
|
2,689
|
|
$
|
1,064
|
|
$
|
891
|
|
$
|
—
|
|
$
|
1,731
|
|
$
|
949
|
|
$
|
—
|
|
Nonqualified
Deferred Compensation Plan
m
atching
c
ontributions
|
|
$
|
—
|
|
$
|
7,369
|
|
$
|
1,130
|
|
$
|
7,733
|
|
$
|
4,687
|
|
$
|
—
|
|
$
|
4,562
|
|
$
|
5,550
|
|
$
|
—
|
|
Excess
life
insurance
|
|
$
|
25
|
|
$
|
3,399
|
|
$
|
503
|
|
$
|
404
|
|
$
|
248
|
|
$
|
625
|
|
$
|
191
|
|
$
|
211
|
|
$
|
1,084
|
|
Tax
p
reparation
|
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
$
|
401
|
|
$
|
581
|
|
$
|
994
|
|
Automobile
expenses – personal use
|
|
$
|
—
|
|
$
|
5,463
|
|
$
|
4,225
|
|
$
|
10,131
|
|
$
|
6,666
|
|
$
|
361
|
|
$
|
7,411
|
|
$
|
13,018
|
|
$
|
1,509
|
|
Executive
Medical
Reimbursement Plan
|
|
$
|
—
|
|
$
|
3,500
|
|
$
|
3,500
|
|
$
|
3,500
|
|
$
|
3,500
|
|
$
|
3,500
|
|
$
|
3,500
|
|
$
|
3,500
|
|
$
|
3,500
|
|
Relocation
Expenses
|
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
$
|
46,350
|
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
Board
of Director Fees
|
|
$
|
14,510
|
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
Severance
Payments
|
|
$
|
—
|
|
$
|
259,615
|
|
$
|
—
|
|
$
|
350,000
|
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
$
|
220,694
|
|
$
|
—
|
|
d.
|
Mr. Gilman
forfeited all equity awards which vested after March 10,
2008, his last
day of employment with the Company. The specific awards that
were forfeited are set forth below:
|
Restricted
Stock
|
Grant
Date
|
No.
of shares
|
8/17/07
|
17,000
|
Stock
Options
|
Grant
Date
|
No.
of Options
|
8/4/04
|
25,000
|
9/14/05
|
25,000
|
5/8/07
|
5,000
|
5/15/07
|
23,787
|
8/17/07
|
26,900
|
As
a result of the
forfeiture, we have reversed ($40,575) of the SFAS 123(R) equity
compensation expense reported for these awards in the Summary Compensation
Table
in the proxy statement for our 2008 annual meeting filed with the SEC
on
February 21, 2008.
e.
|
Mr. Blade
forfeited all equity awards which vested after July 11,
2008, his last day
of employment with the Company. The specific awards that were
forfeited are set forth below:
|
Restricted
Stock
|
Grant
Date
|
No.
of shares
|
9/14/05
|
3,000
|
2/8/06
|
12,000
|
2/6/07
|
13,400
|
4/12/08
|
30,300
|
Stock
Options
|
Grant
Date
|
No.
of Options
|
3/15/04
|
12,000
|
9/14/05
|
16,500
|
2/8/06
|
20,200
|
2/6/07
|
21,300
|
4/12/08
|
48,100
|
As
a result of the
forfeiture, we have reversed ($138,337) of the SFAS 123(R) equity
compensation expense reported for these awards in the Summary Compensation
Table
in the proxy statement for our 2008 annual meeting filed with the
SEC on
February 21, 2008.
f.
|
Mr. Schiller
forfeited all equity awards which vested after July 23,
2008, his last day
of employment with the Company. The specific awards that were
forfeited are set forth below:
|
Restricted
Stock
|
Grant
Date
|
No.
of shares
|
2/8/06
|
7,500
|
2/6/07
|
7,800
|
4/12/08
|
17,500
|
Stock
Options
|
Grant
Date
|
No.
of Options
|
5/11/05
|
10,000
|
2/8/06
|
12,700
|
2/6/07
|
12,300
|
4/12/08
|
27,800
|
As
a result of the
forfeiture, we have reversed ($41,077) of the SFAS 123(R) equity
compensation expense reported for these awards in the Summary Compensation
Table
in the proxy statement for our 2008 annual meeting filed with the
SEC on
February 21, 2008.
g.
|
Mr. Murrill
forfeited all equity awards which vested after September
24, 2008, his
last day of employment with the Company. The specific awards
that were forfeited are set forth
below:
|
Restricted
Stock
|
Grant
Date
|
No.
of shares
|
4/23/07
|
6,400
|
4/12/08
|
13,900
|
Stock
Options
|
Grant
Date
|
No.
of Options
|
4/23/07
|
10,200
|
4/12/08
|
22,100
|
Because
Mr. Murrill
was not a Named Executive Officer in fiscal 2007 and therefore
no equity
compensation costs were reported for these awards in fiscal
2007, we did not
report any negative amount of equity compensation costs for these awards in
the Summary Compensation Table.
Plan-Based
Award Grants
The
following
table sets forth specific information regarding the awards made under
our equity and non-equity incentive plans in fiscal 2008.
GRANTS
OF PLAN-BASED
AWARDS
|
|
Estimated
Possible Payouts Under Non-Equity
Incentive Plan Awards
a
|
|
|
|
|
|
|
|
|
Name
|
Grant
Date
|
Threshold
|
Target
|
Max
|
|
All
Other Stock Awards: Number of Shares of Stock
or Units
b
|
|
All
Other Option Awards: Number of Securities
Underlying Options (#)
c
|
|
Exercise
or Base Price of Option Awards ($/share)
|
|
Grant
Date Fair
Value of Stock and Option Awards ($)
e
|
Mr.
Gilman
|
11/7/08
|
$0
|
$420,000
|
$1,050,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mr. Blade
|
11/7/08
|
$0
|
$140,000
|
$350,000
|
|
|
|
|
|
|
|
|
|
4/12/08
|
|
|
|
|
30,300
d
|
|
|
|
|
|
$226,644
|
|
|
|
|
|
|
|
|
48,100
d
|
|
$7.48
|
|
$201,058
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mr.
Geiger
|
11/7/08
|
$0
|
$56,250
|
$140,625
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
10,400
|
|
|
|
|
|
$77,792
|
|
|
|
|
|
|
|
|
16,400
|
|
$7.48
|
|
$68,552
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mr.
Janjua
|
|
$0
|
$150,000
|
$375,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
20,000
|
|
|
|
|
|
$149,600
|
|
|
|
|
|
|
|
|
31,700
|
|
$7.48
|
|
$132,506
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mr.
Milne
|
|
$0
|
$86,000
|
$215,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
14,300
|
|
|
|
|
|
$106,964
|
|
|
|
|
|
|
|
|
22,800
|
|
|
|
$95,304
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mr.
Schiller
|
11/7/08
|
$0
|
$103,000
|
$257,500
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
17,500
d
|
|
|
|
|
|
$130,900
|
|
|
|
|
|
|
|
|
|
|
|
|
$
116,204
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mr.
Murrill
|
11/7/08
|
$0
|
$104,000
|
$260,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
13,900
d
|
|
|
|
|
|
$103,972
|
|
|
|
|
|
|
|
|
22,100
d
|
|
$7.48
|
|
$92,378
|
a.
|
Because
we did
not
achieve either the threshold
for same store sales growth or EBIT, no annual i
ncentive
payouts were made for
f
iscal
2008.
See
“Compensation Discussion and Analysis – Components of Total Compensation –
Annual Incentive Bonus”
|
b.
|
Represents
restricted stock that
vests three years after the date of grant. See
“
Compensation
Discussion and
Analysis – Components of Total Compensation –
Long-Term Incentives
–
Restricted
Stock
”
for
further
information regarding these shares and the treatment of these
shares in
the event of death, disability, or
retirement.
|
|
|
c.
|
These
options have an exercise
price equal to the closing price of a share of
our
common
stock
on
the
New
York Stock
Exchange
on
the
day preceding the date of
grant
.
These
options vest and become exercisable over four years, at a
rate of 25% per
year, beginning on the first anniversary of the date of grant. See
“
Compensation
Discussion and
Analysis – Components of Total Compensation –
Long-Term Incentives
–
Stock
Options” and “
Compensation
Discussion and Analysis – Employment Agreements, Severance, and
Change-in-Control Agreements – Effect of a Change in Control, Death,
Disability or Retirement on Equity Grants"
above for further
information regarding these
options.
|
|
|
d
|
All
equity grants to
Mr. Blade, Mr. Schiller, and Mr. Murrill were forfeited when
they left the Company.
|
|
|
e.
|
Amounts
represent the grant date
fair value of stock options and restricted stock granted
to each Named
Executive Officer in fiscal 2008. For a discussion of the
assumptions made in the valuation, see Note 15 of Notes to
Consolidated Financial Statements included in Part II,
Item 8 of the Original Filing
.
|
Outstanding
Equity
Awards
The
following table
sets forth certain information about outstanding option and stock awards
held by
the Named Execu
tive
Officers as of the end of f
iscal 2008. Messrs. Blade,
Schiller, and Murrill forfeited all of their options and restricted
stock awards
upon termination of their employment with the Company.
OUTSTANDING
EQUITY AWARDS AT FISCAL YEAR
END
|
Option
Awards
|
|
Stock
Awards
|
|
Unexercised
Options
|
|
Equity
Incentive Plan Awards
|
Name
|
Number
of Securities Underlying Unexercised Options
Exercisable
(#)
|
|
Number
of Securities Underlying Unexercised Options Une
xercisable
(#)
|
|
Option
Exercise
Price ($)
|
|
Option
Expiration Date
|
|
Number
of
Shares
or Units of Stock that Have Not Vested (#)
a
|
|
Market
Value of Shares or Units of Stock that Have Not Vested
($)
b
|
|
Mr.
Biglari
|
N/A
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mr.
Kelley
|
4,000
|
|
1,000
|
|
18.26
|
|
11/17/09
|
|
|
|
|
|
|
8,250
|
|
|
|
17.88
|
|
5/9/09
|
|
|
|
|
|
|
7,247
|
|
|
|
17.70
|
|
12/1/08
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mr.
Geiger
|
3,750
c
|
|
3,750
|
|
17.47
|
|
2/8/16
|
|
|
|
|
|
|
3,300
d
|
|
|
|
16.25
|
|
5/6/09
|
|
|
|
|
|
|
1,339
d
|
|
|
|
15.52
|
|
10/11/08
|
|
|
|
|
|
|
7,500
e
|
|
|
|
17.14
|
|
8/4/09
|
|
|
|
|
|
|
4,000
e
|
|
|
|
19.75
|
|
9/14/10
|
|
|
|
|
|
|
4,036
d
|
|
|
|
17.17
|
|
9/29/11
|
|
|
|
|
|
|
6,982
f
|
|
|
|
16.22
|
|
5/11/12
|
|
|
|
|
|
|
3,650
c
|
|
3,650
|
|
17.72
|
|
2/6/17
|
|
|
|
|
|
|
|
|
16,400
c
|
|
7.48
|
|
4/12/18
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
4,400
|
|
$37,400
|
|
|
|
|
|
|
|
|
|
|
4,600
|
|
$39,100
|
|
|
|
|
|
|
|
|
|
|
10,400
|
|
$88,400
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mr.
Janjua
|
6,100
c
|
|
18,300
|
|
15.07
|
|
6/13/17
|
|
|
|
|
|
|
|
|
31,700
c
|
|
7.48
|
|
4/12/18
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
15,400
|
|
$130,900
|
|
|
|
|
|
|
|
|
|
|
20,000
|
|
$170,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mr.
Milne
|
5,000
e
|
|
|
|
17.14
|
|
8/4/09
|
|
|
|
|
|
|
1,574
c
|
|
|
|
19.71
|
|
2/21/10
|
|
|
|
|
|
|
4,800
d
|
|
1,200
|
|
19.75
|
|
9/14/10
|
|
|
|
|
|
|
3,450
c
|
|
3,450
|
|
17.47
|
|
2/8/16
|
|
|
|
|
|
|
288
f
|
|
|
|
17.17
|
|
9/29/11
|
|
|
|
|
|
|
1,440
c
|
|
360
|
|
16.51
|
|
5/8/17
|
|
|
|
|
|
|
1,954
f
|
|
|
|
16.22
|
|
5/11/12
|
|
|
|
|
|
|
5,025
c
|
|
1,675
|
|
17.72
|
|
2/6/17
|
|
|
|
|
|
|
|
|
22,800
d
|
|
7.48
|
|
4/12/18
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
4,000
|
|
$34,000
|
|
|
|
|
|
|
|
|
|
|
4,100
|
|
$34,850
|
|
|
|
|
|
|
|
|
|
|
4,200
|
|
$35,700
|
|
|
|
|
|
|
|
|
|
|
1,200
|
|
$10,200
|
|
|
|
|
|
|
|
|
|
|
14,300
|
|
$121,550
|
|
a.
|
All
restricted stock grants have a
three year cliff-vesting period. Those granted prior to April 2008
were granted with an equal amount of book units. See "Compensation
Discussion and Analysis -- Components of Total Compensation
-- Long-Term
Incentives -- Restricted Stock" for additional information
regarding these
shares.
|
|
|
b.
|
Market
value is computed based on
a price of $8.50, which was the closing price of our common
stock on the
last day of fiscal 2008.
|
c.
|
These
options vest at a rate of
25% per year beginning on the first anniversary of the date
of grant and
expire ten years from the date of grant; they do not contain
a reload
feature.
|
|
|
d.
|
Thes
e
options vest at a rate of 20%
per year and expire ten years from the date of grant; they
also contain a
reload feature.
|
|
|
e
|
These
options vest at a rate of
20% per year beginning on the date of grant and expire five
years from the
date of grant; they also contain a reload
feature.
|
|
|
f.
|
These
are "reload" options which
were granted pursuant to the 1997 Employee Stock Option Plan. Reload
options are granted in an amount equal to the number of shares
used to pay
the exercise price on the underlying stock options. They are vested
immediately and expire five years from date of grant. Beginning in
February 2006 we ceased issuing options with a reload feature.
|
Award
Exercise and Vesting
The
following
table sets forth the number of options exercised in fiscal 2008,
along with the
value received as a result of the exercise. It also shows the number of
shares of restricted stock that vested during the year, with concurrent
vesting
of book units, and the resulting value realized by the Named Executive
Officer.
OPTION
EXERCISES AND STOCK
VESTED
|
|
|
|
Stock
Awards
|
Name
|
Number
of Shares Acquired on
Vesting
|
|
Value
Realized on
Vesting
a
|
Mr.
Blade
|
8,500
|
|
$154,360
|
Mr.
Geiger
|
5,500
|
|
$99,880
|
Mr.
Milne
|
4,000
|
|
$72,640
|
Mr.
Schiller
|
8,000
|
|
$74,640
|
a.
|
Messrs.
Blade, Geiger, and Milne had stock vest on October 4,
2007. Mr.
Schiller's stock awards vested on May 11, 2008. The amount in this
column includes the value of the restricted stock on
the date of vesting,
based on the closing price of our common stock on the
date of vesting, or
immediately prior thereto if the vesting date was not
a trading day ($7.40
for the May 11, 2008 vesting and $15.59 on October 4,
2007), and the value
of book units which vested in conjunction with the shares
of restricted
stock. The book units associated with the October 4, 2007 vesting
were $2.57 and those associated with the May 11, 2008
vesting were
$1.93.
|
We
maintain two plans
that
provide retirement
income to all
eligible
employees, including
the
Named Executive O
fficers:
401(k)
Pla
n
The
401(k)
P
lan
is
available to all qualified
a
ssociates,
including the
Named Executive Officers.
Until November
2008 w
e match
ed
participant
contributions in an amount
equal to
50% of each
participant’s voluntary contributions
to the 401(k)
Plan
up to 6% of
the participant’s
total cash
compensation
. The
match was suspended in
November 2008 until such time as the Company becomes profitable
again. Participant contributions may consist of salary and cash
compensation, if any, from the Incentive Bonus Plan. Matching
contributions vest
over the
first
six
years
of employment
at a rate of
20% per year,
beginning on
the second
annivers
ary of a
participant’s employment
. Participants
may invest
their contributions and the matching contributions in a variety of
inve
stment options
provided
by Fidelity Investments and their partner funds
.
The
Named Executive Officers and
other “highly compensated employees” (as that term is defined by IRS
regulations) are limited to contributing 1% of their cash compensation
to the
401(k) Plan.
Nonqualified
Deferred Compensation Plan
The
Nonqualified
Deferred Compensation P
lan
(“Deferred
Compensation
Plan”)
is
available
to all highly compensated
employees, including the Named Executive Officers. Investment options
offered under the Deferred Compensation Plan are identical to those
offered in
the 401(k) Plan. Before a participant may make contributions under
the Deferred Compensation Plan, the participant must first contribute
1% of
their earnings to the 401(k) Plan. Until November 2008 we matched
participant contributions in the amount of 50% of the aggregate deferrals
into
both plans, up to 6% of the participant’s cash compensation. Matching
contributions were suspended in November 2008 until such time as
the Company
becomes profitable again. Total deferrals under both the Deferred
Compensation Plan and 401(k) Plan are limited to 20% of the aggregate
of a
participant’s
salary and
annual incentive
bonus
,
which means that as a result of the 1%
of compensation deferred to the 401(k) Plan, the most a participant
may defer to
the Deferred Compensation Plan is 19% of their total cash
compensation
.
Matching
contributions
under the Deferred Compensation Plan vest
over the first
six
years
of employment
, at a rate
of 20% per year beginning on
the second anniversary of employment
.
A
participant’s account balance will be
distributed
at
a time directed by the
participant. Participants may elect that distributions be made in a
lump sum or in equal annual installments over a period of up to ten
(10)
years. Withdrawals from the Deferred Compensation Plan are limited to
the withdrawal of participant contributions in cases of financial
hardship.
The
following table
describes the contributions, earnings, and balance at the end of
fiscal 2008
for
each of the Named Executive Officers
who participat
ed in the
Deferred Compensation P
lan.
NONQUALIFIED
DEFERRED
COMPENSATION
Name
|
|
Executive
Contributions in Last
Fiscal Year
a
|
|
Company
Contributions in Last
Fiscal Year
b
|
|
Aggregate
Earnings in Last Fiscal
Year
|
|
Distributions
in Last Fiscal Year
|
|
Aggregate
Balance at
Last
Fiscal
Year-end
c
|
|
Mr.
Biglari
|
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
Mr.
Gilman
|
|
$
|
28,846
|
|
$
|
7,369
|
|
$
|
(53,784
|
)
|
$
|
—
|
|
$
|
242,612
|
|
Mr.
Kelley
|
|
$
|
2,548
|
|
$
|
1,130
|
|
$
|
(555
|
)
|
$
|
21,194
|
|
$
|
546
|
|
Mr.
Blade
|
|
$
|
50,086
|
|
$
|
7,733
|
|
$
|
(54,358
|
)
|
$
|
—
|
|
$
|
259,299
|
|
Mr.
Geiger
|
|
$
|
9,375
|
|
$
|
4,687
|
|
$
|
(9,811
|
)
|
$
|
—
|
|
$
|
48,894
|
|
Mr.
Janjua
|
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
Mr.
Milne
|
|
$
|
13,121
|
|
$
|
4,562
|
|
$
|
(18,032
|
)
|
$
|
—
|
|
$
|
69,538
|
|
Mr.
Schiller
|
|
$
|
11,587
|
|
$
|
5,550
|
|
$
|
(19,889
|
)
|
$
|
—
|
|
$
|
63,520
|
|
Mr.
Murrill
|
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
a.
|
The
amounts in this column are
also included in the Summary Compensation Table in the
“S
alary
”
column.
|
|
|
b.
|
The
amounts in this column are
also included in the Summary Compensation Table in the
“A
ll
O
ther
C
ompensation
”
column.
|
|
|
c.
|
The
following amounts were
included in this or prior years’ summary compensation tables: Mr. Gilman
($210,792), Mr. Kelley ($15,713), Mr. Blade ($211,680), Mr. Geiger
($38,071), Mr. Milne ($56,841), and Mr. Schiller
($51,152).
|
Potential
Payments Upon Termination of Employment
As
discussed above in
“Compensation Discussion and Analysis – Employment Agreements, Severance and
Change-in-Control Arrangements
–
Effect
of a Change in Control, Death, Disability or
Retirement on Equity Grants
,”
some of our
equity awards accelerate upon a
change in control or upon the retirement, death or disability of
the
holder. Also, some of the Named Executive Officers have agreements
that would provide them with benefits upon the occurrence of one
or more of
these events. The following table sets forth, for each of the Named
Executive Officers other than Messrs.
Biglari, Gilman,
Kelley, Blade,
Schiller, and Murrill
, the
aggregate value that the individual would receive as a result of
any of the
foregoing events if t
hey
had occurred on September 24, 2008
. For amounts
that were paid,
or are payable, to Messrs.
Gilman, Blade,
and Schiller
in connection
with their termination of
employment, see the “All Other Compensation” column and footnote (c) to the
Summary Compensation Table. No amounts were paid or payable to Mr. Kelley
or Mr. Murrill in fiscal year 2008 upon their termination. No amounts
would be payable to Mr. Biglari upon his termination.
|
Resignation
|
Death,
Disability
or
Retirement
|
Termination
a
|
Change
in
Control
b
|
Qualifying
Termination Within One Year of a
Change in
Control
c
|
Mr.
Geiger
|
|
|
|
|
|
Restricted
Stock
e
|
--
|
$211,650
|
--
|
$211,650
|
--
|
Stock
Options
d
|
--
|
--
|
--
|
$16,728
|
--
|
Stay
Payment
f
|
--
|
--
|
--
|
$56,250
|
--
|
Severance
Payment
g
|
--
|
--
|
$187,500
|
--
|
$187,500
|
Health
Care Coverage
h
|
--
|
--
|
$8,500
|
--
|
$8,500
|
Company
Car
i
|
--
|
--
|
$1,481
|
--
|
$1,481
|
Outplacement
Services
j
|
--
|
--
|
$15,000
|
--
|
$15,000
|
|
|
|
|
|
|
Mr.
Janjua
|
|
|
|
|
|
Restricted
Stock
e
|
--
|
$300,900
|
--
|
$300,900
|
--
|
Stock
Options
d
|
--
|
--
|
--
|
$32,334
|
--
|
Stay
Payment
f
|
--
|
--
|
--
|
$100,000
|
--
|
Severance
Payment
g
|
--
|
--
|
$300,000
|
--
|
$300,000
|
Health
Care Coverage
h
|
--
|
--
|
$8,500
|
--
|
$8,500
|
Company
Car
i
|
--
|
--
|
$1,481
|
--
|
$1,481
|
Outplacement
Services
j
|
--
|
--
|
$15,000
|
--
|
$15,000
|
|
|
|
|
|
|
Mr.
Milne
|
|
|
|
|
|
Restricted
Stock
e
|
--
|
$236,300
|
--
|
$236,300
|
--
|
Stock
Options
d
|
--
|
--
|
--
|
$23,256
|
--
|
Stay
Payment
f
|
--
|
--
|
--
|
$64,500
|
--
|
Severance
Payment
g
|
--
|
--
|
$215,000
|
--
|
$215,000
|
Health
Care Coverage
h
|
--
|
--
|
$8,500
|
--
|
$8,500
|
Company
Car
i
|
--
|
--
|
$1,481
|
--
|
$1,481
|
Outplacement
Services
j
|
--
|
--
|
$15,000
|
--
|
$15,000
|
|
a.
|
Amounts
in this column include payments made upon termination by
us without cause
or by the employee with good reason, but exclude payments
made upon or
following a change in control.
|
|
|
|
|
b.
|
Amounts
in this column reflect payments or acceleration of benefits
that would
occur upon a change in control without termination of employment.
|
|
|
|
|
c.
|
Amounts
in this column are payable only if the employment of the
Named Executive
Officer is terminated by us without cause or if the Named
Executive
Officer leaves for good reason within one year following
a change in
control.
|
|
|
|
|
d.
|
Reflects
the excess of the closing price of $8.50 for our stock on
the last day of
fiscal 2008, over the exercise price of outstanding options
currently
vested and any unvested stock options, the vesting of which
would
accelerate as a result of the Named Executive Officer's termination
of
employment on September 24, 2008 as a result of the specified
termination
event, multiplied by the number of shares of our stock underlying
the
stock options.
|
|
|
|
|
e.
|
Reflects
the closing price of $8.50 for our stock on the last day
of fiscal 2008,
multiplied by the number of shares of restricted stock that
would vest as
a result of the Named Executive Officer's termination of
employment on
September 24, 2008 as a result of the specified termination
event, plus
the value of accrued book units through September 24, 2008.
|
|
|
|
|
f.
|
Reflects
the payment of 30% of the Named Executive Officer's salary
immediately
upon a change in control.
|
|
|
|
|
g.
|
Amounts
represent one year of salary payable to the Named Executive
Officers.
|
|
h.
|
Amounts
represent one year of coverage under our group medical plans
at the level
currently elected by the individual.
|
|
|
|
|
i.
|
Amounts
represent the use of the Named Executive Officer's company
car for up to
60 days after termination of employment.
|
|
|
|
|
j.
|
Reflects
the maximum amount of outplacement services for which the
Named Executive
Officer may be reimbursed by us.
|
For
a
description of the terms of the employment agreements for Messrs. Geiger,
Janjua, and Milne, see “Compensation Discussion and Analysis – Employment
Agreements, Severance and Change-in-Control Arrangements – Employment
Agreements.
”
COMPENSATION
OF DIRECTORS
During
fiscal
2008 we compensated non-employee directors with cash annual retainers,
cash
meeting attendance fees and grants of stock options and restricted
stock. The amount of the annual cash retainer payment is
$22,000. The annual retainers for the Chairman of the Audit
Committee, Lead Outside Director and Chairman of the Compensation
Committee is
$37,000 and the annual retainer for the Chairman of the Nominating/Corporate
Governance Committee is $32,000.
In
November
2008 we began paying all annual retainers in Company stock. Because
directors who are employees are not paid for their services on the
Board, Mr.
Biglari does not receive compensation for his Board service and Mr.
Kelley did
not receive any retainer or meeting fees during the time he served
as Interim
Chairman or Interim CEO.
Meeting
attendance fees for non-employee directors are as follows:
·
|
$3,500
for each in-person Board meeting
attended;
|
·
|
$1,250
for each Committee meeting attended that was not held in
conjunction with
a Board meeting;
|
·
|
$1,000
for meetings, travel and interviews with candidates for Board
positions;
|
·
|
$500
for each Committee meeting attended that was held in conjunction
with a
Board of Directors’ meeting; and
|
·
|
$500
for any meeting (Board or Committee) in which the Director
participated telephonically.
|
In
addition,
we reimburse the ordinary expenses the members of the Board of Directors
incur
in attending board and committee meetings. In fiscal 2008 all
non-employee directors were also eligible to participate in our medical
reimbursement plan, which provided reimbursement for unreimbursed
medical bills
in an amount of up to $3,500 per calendar year, which amount is increased
or
“grossed up” in an amount equal to the estimated taxes payable by the directors
for this benefit. They were also entitled to obtain reimbursement for
75% of their tax preparation fees up to $1,250. These benefits were
discontinued for calendar year 2009.
In
addition
to the foregoing payments, directors may participate in the Nonqualified
Deferred Compensation Plan. There are no matching payments made to
directors under the Nonqualified Deferred Compensation Plan and no
guaranteed
return is offered. Instead, it provides directors with an opportunity
to defer the receipt of retainer and/or meeting fees and obtain them
at a later
date, together with the gains or losses associated with investments
against
which they choose to track their accounts.
The
chart
below shows the compensation received by our directors during fiscal
year 2008,
other than Mr. Biglari, whose director fees are included in the “All Other
Compensation” column and footnote (c) to the Summary Compensation
Table.
DIRECTOR
COMPENSATION
Name
|
|
Fees
Earned or Paid in
Cash
|
|
Stock
Awards
a
|
|
Option
Awards
b
|
|
All
Other Compensation
c
|
|
Total
|
|
Geoffrey
Ballotti
|
|
$
|
57,750
|
|
$
|
5,613
|
|
$
|
6,163
|
|
$
|
4,679
|
|
$
|
74,205
|
|
Philip
Cooley
|
|
$
|
31,682
|
|
$
|
1,655
|
|
$
|
—
|
|
$
|
—
|
|
$
|
33,337
|
|
Wayne
Kelley
|
|
$
|
7,667
|
|
$
|
—
|
|
$
|
2,023
|
|
$
|
—
|
|
$
|
9,690
|
|
Ruth
J. Person
|
|
$
|
49,067
|
|
$
|
—
|
|
$
|
16,685
|
|
$
|
5,396
|
|
$
|
71,148
|
|
J.
Fred Risk
|
|
$
|
53,833
|
|
$
|
—
|
|
$
|
16,685
|
|
$
|
5,268
|
|
$
|
75,786
|
|
John
W. Ryan
|
|
$
|
72,917
|
|
$
|
—
|
|
$
|
16,685
|
|
$
|
5,999
|
|
$
|
95,601
|
|
Steven
M. Schmidt
|
|
$
|
56,250
|
|
$
|
5,947
|
|
$
|
17,410
|
|
$
|
5,268
|
|
$
|
84,875
|
|
Edward
Wilhelm
|
|
$
|
74,917
|
|
$
|
5,947
|
|
$
|
14,039
|
|
$
|
5,268
|
|
$
|
100,171
|
|
James
Williamson, Jr.
|
|
$
|
40,734
|
|
$
|
—
|
|
$
|
(219
|
)
|
$
|
5,268
|
|
$
|
45,783
|
|
a.
|
Represents
the dollar amount of equity compensation cost recognized
for financial
reporting purposes with respect to grants of restricted stock
under our
Non-Employee Restricted Stock Plan in fiscal 2008, computed
in accordance
with SFAS 123(R). Dr. Cooley received a grant of 1,000 shares
of restricted stock on March 12, 2008, the grant date fair value
of
which was $8,070.
Messrs.
Schmidt and
Wilhelm received a grant of 1,000 shares
of restricted
stock
each
on February 6, 2007, the
grant date
fair value of which
was $17,840. Mr. Ballotti received a grant of 1,000
shares
of
restricted stock
on April 23, 2007,
the
grant
date
fair
value of which was $16,840. These are all of the shares of
restricted stock held by our
directors.
|
b.
|
Represents
the dollar amount of equity compensation cost recognized
for financial
reporting purposes with respect to grants of stock options
in fiscal 2008,
computed in accordance with SFAS 123(R), as
follows:
|
Fiscal
2008 Expense for Stock Option Grants to Non-Employee
Directors
|
|
Name
|
Grant
Date
|
|
No.
of Shares Underlying Option Grant
|
|
Fiscal
2008 Expense
|
|
Mr.
Ballotti
|
4/20/07
|
|
5,000
|
|
$
|
6,163
|
|
Total
|
|
|
|
|
|
$
|
6,163
|
|
|
|
|
|
|
|
|
|
|
Mr.
Kelley
|
5/9/99
|
|
8,
250
|
|
$
|
—
|
|
|
11/12/03
|
|
5,000
|
|
|
218
|
|
|
12/1/03
|
|
7,
247
|
|
|
—
|
|
|
11/18/04
|
|
5,
000
|
|
|
1,
805
|
|
Total
|
|
|
|
|
|
$
|
2,023
|
|
|
|
|
|
|
|
|
|
|
Dr.
Person
|
11/13/02
|
|
5,000
|
|
$
|
—
|
|
|
11/12/03
|
|
5,000
|
|
|
218
|
|
|
11/18/04
|
|
5,000
|
|
|
1,805
|
|
|
11/8/05
|
|
5,000
|
|
|
7,823
|
|
|
2/6/07
|
|
5,000
|
|
|
6,839
|
|
Total
|
|
|
|
|
|
$
|
16,685
|
|
|
|
|
|
|
|
|
|
|
Mr.
Risk
|
11/13/02
|
|
5,000
|
|
$
|
—
|
|
|
11/12/03
|
|
5,000
|
|
|
218
|
|
|
11/18/04
|
|
5,000
|
|
|
1,805
|
|
|
11/8/05
|
|
5,000
|
|
|
7,823
|
|
|
2/6/07
|
|
5,000
|
|
|
6,839
|
|
Total
|
|
|
|
|
|
$
|
16,685
|
|
|
|
|
|
|
|
|
|
|
Dr.
Ryan
|
11/13/02
|
|
5,000
|
|
$
|
—
|
|
|
11/12/03
|
|
5,000
|
|
|
218
|
|
|
11/18/04
|
|
5,000
|
|
|
1,805
|
|
|
11/8/05
|
|
5,000
|
|
|
7,823
|
|
|
2/6/07
|
|
5,000
|
|
|
6,839
|
|
Total
|
|
|
|
|
|
$
|
16,685
|
|
|
|
|
|
|
|
|
|
|
Mr.
Schmidt
|
5/11/05
|
|
5,000
|
|
|
2,748
|
|
|
11/8/05
|
|
5,000
|
|
|
7,823
|
|
|
2/6/07
|
|
5,000
|
|
|
6,839
|
|
Total
|
|
|
|
|
|
$
|
17,410
|
|
|
|
|
|
|
|
|
|
|
Mr.
Wilhelm
|
5/9/06
|
|
5,000
|
|
$
|
7,200
|
|
|
2/6/07
|
|
5,000
|
|
|
6,839
|
|
Total
|
|
|
|
|
|
$
|
14,039
|
|
Mr.
Williamson
d
|
11/13/02
|
|
5,000
|
|
$
|
—
|
|
|
11/12/03
|
|
5,000
|
|
|
(218
|
)
|
|
11/18/04
|
|
5,000
|
|
|
(2,800
|
)
|
|
11/8/05
|
|
5,000
|
|
|
815
|
|
|
2/6/07
|
|
5,000
|
|
|
2,422
|
|
Total
|
|
|
|
|
|
$
|
(219
|
)
|
See
Note 15 of Notes
to Consolidated Financial Statements included in Part II,
Item 8 of the Original Filing
for a description
of the
assumptions made in the valuation.
The
preceding table sets forth the
shares
of
our
stock underlying unexercised stock options held
by
each of our non-employee
directors as
of
September 24, 2008
.
In
the aggregate that
number is 131,000. No stock options were awarded to our non-employee
directors in fiscal year 2008.
c.
|
This
column includes the medical reimbursement plan, which has a value of
$3,500 per year, tax gross up for the medical reimbursement
plan, and
reimbursement of 75% of tax preparation
fees.
|
d.
|
Mr.
Williamson forfeited all options on March 10, 2008, his
last day of
service on our Board of Directors. As a result, we have reversed
($219) of the SFAS 123(R) equity compensation expense reported
for these
awards in the Director Compensation table in the proxy
statement for our
2008 annual meeting filed with the SEC on February 21,
2008.
|
In
the past
we have compensated our non-employee directors with equity-based awards,
the
value of which are tied to increases in the value of our common
stock. We have had director stock option plans in place since
1990. These plans provide for grants of nonqualified stock options to
our non-employee directors at a price equal to the fair market value
of our
common stock on the date of grant. Options granted prior to November
7, 2005 are exercisable at a rate of 20% on the date of grant and on
each
anniversary thereof until fully exercisable and expire five years from
the date
of grant. Options granted after November 7, 2005 are exercisable at a
rate of 25% on the first anniversary of the grant and each year thereafter
until
fully vested. Finally, some newly appointed or elected directors
received a grant of 1,000 shares of restricted stock. Dr. Cooley
received such a grant in fiscal 2008. At his request, Mr. Biglari did
not receive a grant. These shares have a three year restriction on
transfer, and if a recipient ceases serving as a director for any reason
other
than death, disability or retirement during this period he/she will
forfeit the
stock.
REPORT
OF THE COMPENSATION COMMITTEE
The
compensation of the Company’s executive officers is determined by the
Compensation Committee of the Board of Directors, which is comprised
of the
persons identified below. We have reviewed and discussed with
management the Compensation Discussion and Analysis that follows this
report. Based on our review and discussions with management, we
recommended to the Board of Directors that the Compensation Discussion
and
Analysis be included in the Company’s Annual Report on Form 10-K for the fiscal
year ended September 24, 2008 and in the proxy statement for the 2009
annual
meeting of shareholders.
The
foregoing
report is respectfully submitted by the members of the Compensation
Committee:
Steven
Schmidt, Chairman, and Drs. Ruth J. Person, John W. Ryan and Philip
Cooley.
Compensation
Committee Interlocks and Insider Participation
In
fiscal
year 2008, Drs. Ruth J. Person, John W. Ryan, and Philip Cooley and Mr.
Steven M. Schmidt served on the Compensation Committee. During fiscal
2008:
·
|
None
of our executive officers served as a member of the compensation
committee of another entity, one of whose executive officers
served on our
Compensation Committee;
|
·
|
None
of our executive officers served as a director of another
entity, one of
whose executive officers served on our Compensation Committee;
and
|
·
|
None
of our executive officers served as a member of the compensation
committee of another entity, one of whose executive officers
served
as our
director.
|
ITEM
12
.
SECURITY OWNERSHIP
OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND
RELATED SHAREHOLDER MATTERS
Ownership
of Common Stock
The
following
table shows as of January 20, 2009, the number and percentage of outstanding
shares of our common stock beneficially owned by each person or entity
known to
be the beneficial owner of more than 5% of our common stock:
Name
&
Address
of Beneficial
Owner
|
|
Amount
and Nature of Beneficial
Ownership
|
|
|
Percent
of
Class
|
|
MSD
Capital,
L.P.
MSD
SBI, L.P.
645
Fifth Avenue, 21
st
Floor
New
York,
NY 10022-5910
|
|
|
2,782,300
|
(1)
|
|
|
9.7
|
%
|
T.
Rowe Price Associates,
Inc.
100
E. Pratt
Street
Baltimore,
MD
21202
|
|
|
1,827,700
|
(2)
|
|
|
6.4
|
%
|
Keeley
Asset Management
Corp.
401
South LaSalle St. Suite
1201
Chicago,
IL
60605
|
|
|
2,498,632
|
(3)
|
|
|
8.7
|
%
|
The
Lion Fund,
L.P.
9311
San Pedro Ave. Suite
1440
San
Antonio, TX
78216
|
|
|
3,755,725
|
(4)
|
|
|
13.1
|
%
|
HBK
Master Fund,
L.P.
HBK
Investments
L.P.
300
Crescent Ct. Suite
700
Dallas,
TX
75201
|
|
|
2,703,726
|
(5)
|
|
|
9.4
|
%
|
Barclay’s
Global Investors,
N.A.
45
Fremont
Street
San
Francisco, CA 94105
|
|
|
1,448,689
|
(6)
|
|
|
5.0
|
%
|
Dimensional
Fund Advisors LP
1299 Ocean Avenue
Santa Monica, CA 90401
|
|
|
2,014,935
|
(7)
|
|
|
7.0
|
%
|
(1)
|
This
information was supplied on a Schedule 13G/A filed with the
SEC on
February 14, 2007. MSD Capital, L.P. and MSD SBI, L.P. share
voting and investment power over the reported
shares.
|
|
|
(2)
|
This
information was supplied on a Schedule 13G filed with the
SEC on February
12, 2008. These securities are owned by various individual and
institutional investors including T. Rowe Price Associates,
Inc. ("Price
Associates") which serves as investment advisor with power
to direct
investments and/or sole power to vote the securities. For purposes
of the reporting requirements of the Exchange Act, Price
Associates is
deemed to be a beneficial owner of such securities; however
Price
Associates expressly disclaims that it is, in fact, the beneficial
owner
of such securities.
|
|
|
(3)
|
This
information was supplied on a Schedule 13G/A filed with the SEC on
February 14, 2008.
|
|
|
(4)
|
This
information was supplied on a Schedule 13D/A filed with
the Securities and
Exchange Commission on June 4, 2008. The Lion Fund, L.P.,
Biglari Capital Corp., Western Acquisitions, L.P., Western
Investments,
Inc., Sardar Biglari, Western Sizzlin Corp., and Philip
Cooley share
voting power over the shares. In addition, Sue Aramian has sole
dispositive power over 17,720 of the shares, Martha Aramian has sole
dispositive power over 106,862 of the shares, Charles Arnett and
Virginia Arnett each have sole dispositive power over 81,963 of the
shares, Gary Ruben and Irene Ruben each have shared dispositive
power over 37,878 of the shares, Natasha Sedaghat has sole
dispositive
power over 30,000 of the shares, Parvindokht Sedaghat and Shapour
Sedaghat each have shared dispositive power over 300,000 of the
shares, Shawn Sedaghat has sole dispositive power over
101,669 of the
shares, Tim Taft has sole dispositive power over 34,450
of the shares,
Robert Stevens has sole dispositive power over 209,752
of the
shares, Wayne King has sole dispositive power 100,000 of the shares
and Jonathan Dash and Dash Acquisitions LLC each have shared
dispositive power over 163,686 of the
shares.
|
|
|
(5)
|
This
information was supplied on a Schedule 13D/A filed with the
SEC on July 3,
2007. HBK Master Fund L.P., HBK Fund L.P., HBK Investments L.P.,
HBK
Services LLC, HBK Partners II L.P., HBK Management LLC, LSF5
Indy
Investments, LLC, LSF5 Indy Holdings, LLC, LSF5 REOC VII,
L.P., LSF5
GenPar VII, LLC, Lone Star Fund V (U.S.), Lone Star Partners
V, L.P., Lone
Star Management Co. V, Ltd., John P. Grayken, and Robert
J. Stetson, share
voting power over the shares.
|
|
|
(6)
|
This
information was obtained from a Schedule 13G/A filed with
the SEC on
January 10, 200. Barclays Global Investors, NA, Barclays Global Fund
Advisors, Barclays Global Investors, LTD, share voting power
over the
shares.
|
|
|
(7)
|
This
information was obtained from a Schedule 13G filed with the SEC on
February 6, 2008.
|
The
following
table shows the total number of shares of our common stock beneficially
owned as
of January 20, 2009 and the percentage of outstanding shares for (i) each
director, (ii) each executive officer named in the Summary Compensation
Table,
and (iii) all directors and executive officers, as a group:
Name
of Beneficial
Owner
|
|
Amount
and Nature of Beneficial
Ownership
(1)
|
|
Percent
of
Class
|
|
Sardar
Biglari
|
|
|
2,537,745
|
(2)
|
|
8.8
|
%
|
Jeffrey
Blade
|
|
|
14,900
|
(3)
|
|
*
|
|
Philip
Cooley
|
|
|
65,226
|
(4)
|
|
*
|
|
|
|
|
77,315
|
(5)
|
|
*
|
|
Alan
B.
Gilman
|
|
|
364,846
|
(6)
|
|
1.3
|
%
|
Omar
Janjua
|
|
|
41,500
|
(7)
|
|
*
|
|
Wayne
L.
Kelley
|
|
|
72,120
|
(8)
|
|
*
|
|
David
C. Milne
|
|
|
57,133
|
(9)
|
|
*
|
|
Thomas
Murrill
|
|
|
—
|
(10)
|
|
—
|
|
Ruth
J.
Person
|
|
|
17,476
|
(11)
|
|
*
|
|
William
J. Regan,
Jr.
|
|
|
4,064
|
|
|
*
|
|
J.
Fred
Risk
|
|
|
65,993
|
(12)
|
|
*
|
|
John
W.
Ryan
|
|
|
26,259
|
(
13)
|
|
*
|
|
Steven
Schiller
|
|
|
—
|
(14)
|
|
—
|
|
Steven
M.
Schmidt
|
|
|
13,312
|
(15)
|
|
*
|
|
Edward
Wilhelm
|
|
|
10,062
|
(16)
|
|
*
|
|
All
directors and executive
officers as a group (18 persons)
|
|
|
3,377,495
|
(17)
|
|
11.7
|
%
|
|
|
|
|
|
|
|
|
*Less
than
1%.
|
|
|
|
|
|
|
|
|
(1)
|
Includes
shares that may be acquired pursuant to stock options exercisable
within
60 days.
|
|
|
|
|
(2)
|
These
shares are owned by others, although Mr. Biglari exercises
beneficial
ownership over them.
|
|
|
|
|
(3)
|
This
information was taken from the last Form 4 Mr. Blade filed
with the
SEC.
|
|
|
|
|
(4)
|
Includes 11,000
shares by Dr. Cooley's spouse.
|
|
|
|
|
(5)
|
Includes 38,257
shares that may be acquired pursuant to stock options exercisable
within
60 days.
|
|
|
|
|
(6)
|
This
information was taken from the last Form 4 Mr. Gilman filed with the
SEC.
|
|
|
|
|
(7)
|
Includes
6,100 shares that may be acquired pursuant to stock options
exercisable
within 60 days.
|
|
|
|
|
(8)
|
Includes 25,497
shares that may be acquired pursuant to stock options exercisable
within
60 days.
|
|
|
|
|
(9)
|
Includes 26,931
shares that may be acquired pursuant to stock options exercisable
within
60 days.
|
|
|
|
|
(10)
|
This
information was taken from the last Form 4 Mr. Murrill filed with the
SEC.
|
|
|
|
|
(11)
|
Includes
11,250 shares that may be acquired pursuant to stock options
exercisable
within 60 days.
|
|
|
|
|
(12)
|
Includes
11,250 shares that may be acquired pursuant to stock options
exercisable
within 60 days. Also includes 723 shares held by Mr. Risk’s spouse,
regarding which he disclaims beneficial ownership.
|
|
|
|
|
(13)
|
Includes 11,250
shares that may be acquired pursuant to stock options exercisable
within
60 days.
|
|
|
|
|
(14)
|
This
information was taken from the last Form 4 Mr. Schiller filed with
the SEC.
|
|
|
|
|
(15)
|
Includes 10,250
shares that may be acquired pursuant to stock options exercisable
within
60 days.
|
|
|
|
|
(16)
|
Includes 5,000
shares that may be acquired pursuant to stock options exercisable
within
60 days.
|
|
|
|
|
(17)
|
Includes 156,785
shares that may be acquired pursuant to stock options exercisable
within
60 days.
|
Equity
Compensation Plan Information
The
following
table provides information regarding our current equity compensation
plans as of
September 24, 2008.
EQUITY
COMPENSATION PLAN INFORMATION
|
|
|
|
|
Plan
Category
|
Number
of Securities to be Issued Upon Exercise of Outstanding Options,
Warrants
and Rights
|
Weighted
Average Exercise Price of Outstanding Options, Warrants and
Rights
|
Number
of Securities Remaining Available for Future Issuance Under
Equity
Compensation Plans (Excluding Securities Reflected in First
Column)
|
Equity
Compensation Plans approved by Shareholders
(1)
|
1,371,551
|
$11.63
|
814,138
(2)
|
Equity
Compensation Plans not approved by Shareholders
|
–
|
N/A
|
N/A
|
Totals
|
1,371,551
|
$11.63
|
814,138
|
|
|
Consists
of 1997 and 2006 Employee Stock Option Plans, 2003, 2004
and 2005 Director
Stock Option Plans, the 2007 Non-Employee Director Restricted
Stock Plan,
the 1997 Capital Appreciation Plan, as amended and restated, the 1992
and 2006 Employee Stock Purchase Plans, and the 2008
Equity Incentive
Plan.
|
|
|
|
|
(2)
|
As
of September 24, 2008, 395,120 shares remained available
for issuance
pursuant to awards under the 2008 Equity Incentive
Plan.
|
ITEM
13
. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
AND
DIRECTOR INDEPENDENCE
Policy
Regarding Related Person Transactions
The
policy
of the Board
is
for
it, or one of its committees,
to review
each related
person transaction (as defined below) and determine whether it
will approve or
ratify that transaction. Any Board member who has any interest (actual or
perceived) will not be involved in the consideration.
For
purposes of the
policy, a “related person transaction” is any transaction, arrangement or
relationship
in which
we
are a participant, the related p
erson (defined
below) had, has or will
have a direct or indirect material interest and the aggregate amount
involved is
expected to exceed $120,000 in any calendar year.
“Related pe
rson”
includes
(a) any person who is or
was (at any time during the last fiscal year) an officer, director
or nominee
for election as a director; (b) any person or group who is a beneficial
owner of
more than 5% of
our
voting
securities; (c) any
immediate family member of a person described in provisions (a)
or (b) of this
sentence; or (d) any entity in which any of the foregoing persons
is employed,
is a partner or has a greater than 5% beneficial ownership
interest.
In
determining
whether a related person transaction will be approved or ratified,
the
Board
, or
committee,
may consider
factors such as (a) the ex
tent of the
related p
erson
’
s
interest in the transaction; (b) the
availability of other sources of comparable products or services;
(c) whether
the terms are competitive with terms generally available in similar
transact
ions with
persons
that are not r
elat
ed
p
ersons; (d)
the benefit to
us
;
and (e) the aggregate value of the
transaction.
Kelley
Employment Agreement
During
a
portion of fiscal 2008, Mr. Kelley received compensation under
an employment
agreement. He received an annual salary of $75,000, regular employee
benefits provided to other employees at his level and had the use
of a Chrysler
Pacifica minivan or similar vehicle. Mr. Kelley and the Company
terminated this employment agreement on March 12, 2008 when he
became Interim
Chairman and Chief Executive Officer of the Company.
Reimbursement
of Proxy Fees
On
August 6, 2008,
our
Board
of Directors agreed to reimburse
Western Sizzlin
and the
Lion Fund for
a portion
of
the
expenses
related to
th
e successful
proxy
contest
they conducted
at the
2008
annual meeting. The amount
reimbursed was
$500,000. Mr. Biglari
serves as
the Chairman and Chief Executive Officer of both Western Sizzlin and
the Lion Fund and Dr. Cooley i
s a director
and shareholder of
both.
Mr.
Biglari and Dr. Cooley
abstained from voting on this issue.
Director
Independence
The
Board has
determined that all of its members, other than Messrs. Biglari
and Kelley, are
“independent” within the meaning of the listing standards of the New York Stock
Exchange because none of them has, directly or indirectly, any
material
relationship with the Company. The Board has made these
determinations after considering the following:
1)
|
None
of the independent directors is our officer or employee or an officer
or employee of our subsidiaries or affiliates, nor has
been such an
officer or employee within the prior three years; further,
no immediate
family member of the independent directors is, or has been
in the past
three years, an executive officer of the Company.
|
|
|
2)
|
None
of the independent directors has received, nor has an immediate
family
member of such directors received, during any twelve month
period in the
last three years, more than $120,000 in direct compensation
from us, other
than director and committee fees and pension or other forms
of deferred
compensation for prior service.
|
|
|
3)
|
None
of the independent directors or any member of their immediate
family is or
within the past five years has been affiliated with Deloitte
& Touche
LLP (“Deloitte”).
|
|
|
4)
|
None
of the independent directors or any member of their immediate
families
have within the last three years been employed as an executive
officer of
another company on whose compensation committee one of our present
executive officers served.
|
|
|
5)
|
None
of the independent directors is a current employee or has
an immediate
family member who is a current executive officer of a company
that in any
of the last three fiscal years has done business with us
in an amount in
excess of $1 million or 2% of such other company’s consolidated gross
revenues.
|
|
|
6)
|
None
of the independent directors serves as a director, trustee,
executive
officer or similar position of a charitable or non-profit
organization to
which, in any of the last three fiscal years, we or our subsidiaries
made charitable contributions or payments in any single
fiscal year in
excess of $1 million or 2% of the organization’s consolidated gross
revenues.
|
ITEM
14.
PRINCIPAL ACCOUNTANT FEES AND SERVICES
Independent
Auditors’ Fees
Deloitte has
advised us that they have billed or will bill us the following
amounts for
services for each of the last two fiscal years.
Type of
Fee
|
|
Fiscal
2008
|
|
Fiscal
2007
|
|
Audit
Fees
(1)
|
|
$
|
409,000
|
|
$
|
403,350
|
|
Audit-Related
Fees
(2)
|
|
$
|
—
|
|
$
|
15,000
|
|
Tax
Fees
(3)
|
|
$
|
24,589
|
|
$
|
103,019
|
|
All
Other Fees
|
|
$
|
—
|
|
$
|
—
|
|
Total
Fees for the Applicable Fiscal Year
|
|
$
|
433,589
|
|
$
|
521,369
|
|
|
|
Audit
fees include fees for services performed for the
audit of our annual
financial statements including services related
to Section 404 of the
Sarbanes-Oxley Act and review of financial statements
included in our Form
10-Q filings, Form 10-K filing and Form S-8 Registration statements,
comment letters and services that are normally
provided in connection with
statutory or regulatory filings or
engagements.
|
|
|
|
|
(2)
|
Audit-Related
Fees include fees for assurance and related services
performed that are
reasonably related to the performance of the audit
or review of our
financial statements. This includes the audit of our 401(k)
Plan. These fees are partially paid through 401(k) Plan
forfeitures.
|
|
(3)
|
Tax
Fees are fees for services performed with respect
to tax compliance, tax
advice and other tax
review.
|
Pre-approval
Policy
The
Audit
Committee's policy is to pre-approve all audit and permissible
non-audit
services provided by the independent registered public accounting
firm. These services may include audit services, audit-related
services, tax services and other services. Pre-approval is generally
provided for up to one year and any pre-approval is detailed
as to the
particular service or category of services and is generally subject
to a
specific budget. The independent auditor and management are required
to report periodically to the Audit Committee regarding the extent
of services
provided by the independent auditor in accordance with this pre-approval,
and
the fees for the services performed to date. The Audit Committee may
also pre-approve particular services on a case-by-case basis. In
fiscal 2008, the Audit Committee pre-approved the services reported
above as
audit-related services and tax fees and Deloitte did not provide
any non-audit
services during such year.