Biglari Gets A Deal For The Use Of His Name
How much is Sardar Biglari's name worth? $18.5 million, at least right now. That's how much Biglari Holdings would have to pay its chairman for the use of his name should the San Antonio-based company decide to give him the boot according to a recent SEC filing.
According to the filing, Biglari would get a fee of 2.5 percent of revenues should someone else take the helm of his company, making that quite a severance package. Based on last year's revenue, that's $18.5 million. The contract lasts 20 years.
The unusual move is the latest in a series of efforts by Biglari that have seemingly been designed to protect his power -- he's tried instilling a dual class share structure and also tried a massive, reverse stock split that would have taken Biglari Holdings' stock into the stratosphere.
We can't imagine a contractual provision that protects an executive's power more than one that would pay him a big chunk of company revenue should he get fired or should he bolt due to some "trigger event."
We also can't help but note that Biglari took over Steak N Shake, got installed as chairman, gave the company his own name, and now wants to charge that company for the use of said name if he were to depart.