UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-K/A

(Amendment No. 1)

 ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 2019

or

 ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ____ to ____

Commission file number 001-38477

BIGLARI HOLDINGS INC.

(Exact name of registrant as specified in its charter)

INDIANA	82-3784946
(State or other jurisdiction of incorporation)	(I.R.S. Employer Identification No.)

17802 IH 10 West, Suite 400 San Antonio, Texas	78257
(Address of principal executive offices)	(Zip Code)

(210) 344-3400

Registrant’s telephone number, including area code

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbols	Name of each exchange on which registered
Class A Common Stock, no par value	BH.A	New York Stock Exchange
Class B Common Stock, no par value	BH	New York Stock Exchange

Securities registered pursuant to Section 12(g) of the Act:

NONE

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☐ No x

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes ☐ No x

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (Section 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes x No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer o Accelerated filer x Non-accelerated filer o  Smaller reporting company o Emerging growth company o 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o No x

The aggregate market value of the voting and non-voting common stock held by non-affiliates of the registrant as of June 30, 2019 was approximately $137,552,014.

Number of shares of common stock outstanding as of February 17, 2020:

Class A common stock –	206,864
Class B common stock –	2,068,640

DOCUMENTS INCORPORATED BY REFERENCE

None

Table of Contents

Page 

PART IV

Item 15. Exhibits and Financial Statement Schedules	1
Signatures	10
Index to Exhibits	11

i

EXPLANATORY NOTE

This Amendment No. 1 on Form 10-K/A (the “Amendment”) amends the Annual Report on Form 10-K of Biglari Holdings Inc. (“Biglari Holdings”, “we”, “us”, “our”, the “Company” or the “Corporation”) for the fiscal year ended December 31, 2019, originally filed with the Securities and Exchange Commission (the “SEC”) on February 24, 2020 (the “Original Filing”), to include separate audited financial statements of The Lion Fund II, L.P. (the “Lion Fund II”) pursuant to Rule 3-09 of Regulation S-X (“Rule 3-09”) in Part IV, Item 15. The audited financial statements of the Lion Fund II (the “Lion Fund II Financial Statements”) were not available at the time of the Original Filing. In accordance with Rule 3-09(b)(2), the Lion Fund II Financial Statements are being filed as an amendment to the Original Filing within 90 days after the end of the Lion Fund II’s fiscal year.

In addition, in connection with the filing of this Amendment and pursuant to the rules of the SEC, we are including with this Amendment certain currently dated certifications. Accordingly, Item 15 of Part IV has also been amended to reflect the filing of these currently dated certifications.

This Form 10-K/A does not attempt to modify or update any other disclosures set forth in the Original Filing, except as required to reflect the additional information included in Part IV, Item 15 of this Form 10-K/A. Additionally, this Form 10-K/A, except for the additional information included in Part IV, speaks as of the filing date of the Original Filing and does not update or discuss any other Company developments subsequent to the date of the Original Filing. Accordingly, this Form 10-K/A should be read in conjunction with our filings made with the SEC subsequent to the Original Filing.

ii

Item 15. Exhibits and Financial Statement Schedules

INDEPENDENT AUDITORS’ REPORT

To the Partners of
The Lion Fund II, L.P.
San Antonio, Texas

We have audited the accompanying financial statements of The Lion Fund II, L.P., (a Delaware limited partnership) (the "Fund"), which comprise the statements of assets and liabilities, including the condensed schedules of investments, as of December 31, 2019 and 2018, and the related statements of operations, changes in partners’ capital, and cash flows for the years ended December 31, 2019, 2018 and 2017, and the related notes to the financial statements.

Management’s Responsibility for the Financial Statements

Management is responsible for the preparation and fair presentation of these financial statements in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error.

Auditors’ Responsibility

Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audit in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Fund’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Fund’s internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion

In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of The Lion Fund II, L.P., as of December 31, 2019 and 2018, and the results of its operations, changes in partners’ capital, and its cash flows for the years ended December 31, 2019, 2018 and 2017, in accordance with accounting principles generally accepted in the United States of America.

/s/ DELOITTE & TOUCHE LLP

Indianapolis, Indiana

March 30, 2020

1

THE LION FUND II, L.P.

(A Delaware Limited Partnership)

STATEMENT OF ASSETS AND LIABILITIES

	December 31, 2019		December 31, 2018
ASSETS:
Investments in securities — at fair value	$	484,265,214	$	817,479,463
Cash and cash equivalents		244,508,174		83,943,690
Receivables		19,889,744		—
Advance distributions		10,000,000		—
Total assets	$	758,663,132	$	901,423,153
LIABILITIES:
Long-term debt	$	112,000,000	$	199,672,818
Derivatives		2,226,670		1,766,516
Interest payable		370,215		853,642
Accounts payable		42,000		149,987
Total liabilities	$	114,638,885	$	202,442,963
PARTNERS’ CAPITAL	$	644,024,247	$	698,980,190
See notes to financial statements.

2

THE LION FUND II, L.P.

(A Delaware Limited Partnership)

STATEMENT OF OPERATIONS

FOR THE YEARS ENDED DECEMBER 31, 2019, 2018 AND 2017

	2019			2018			2017
INVESTMENT INCOME:
Dividends and interest	$	31,829,049		$	41,147,563		$	38,185,761
EXPENSES:
Professional fees		187,220			134,987			5,852,396
Interest expense		7,039,956			9,626,977			4,603,910
NET INVESTMENT INCOME		24,601,873			31,385,599			27,729,455
REALIZED AND UNREALIZED GAINS (LOSSES):
Net realized gains (losses) from investments		185,900,988			27,874,223			(768,420	)
Net change in unrealized appreciation - investments		(131,898,804	)		(189,452,895	)		(77,377,962	)
Net change in unrealized appreciation - forward contract		—			—			45,177,780
Cost of forward contract at maturity		—			—			(30,500,593	)
NET INCREASE (DECREASE) IN PARTNERS’ CAPITAL RESULTING FROM OPERATIONS	$	78,604,057		$	(130,193,073	)	$	(35,739,740	)
See notes to financial statements.

3

THE LION FUND II, L.P.

(A Delaware Limited Partnership)

STATEMENT OF CHANGES IN PARTNERS’ CAPITAL

FOR THE YEARS ENDED DECEMBER 31, 2019, 2018 AND 2017

	General			Limited
	Partner			Partners			Total
PARTNERS’ CAPITAL — December 31, 2016	$	70,376,987		$	837,628,741		$	908,005,728
Capital contributions		—			9,707,250			9,707,250
Capital distributions		(7,720,000	)		(13,489,975	)		(21,209,975	)
Net decrease from operations		(2,810,898	)		(32,928,842	)		(35,739,740	)
PARTNERS’ CAPITAL — December 31, 2017	$	59,846,089		$	800,917,174		$	860,763,263
Capital contributions		—			39,040,000			39,040,000
Capital distributions		(1,745,000	)		(68,885,000	)		(70,630,000	)
Net decrease from operations		(9,110,326	)		(121,082,747	)		(130,193,073	)
PARTNERS’ CAPITAL — December 31, 2018	$	48,990,763		$	649,989,427		$	698,980,190
Capital contributions		—			40,000,000			40,000,000
Capital distributions		(14,135,000	)		(159,425,000	)		(173,560,000	)
Net increase from operations		4,611,853			73,992,204			78,604,057
PARTNERS’ CAPITAL — December 31, 2019	$	39,467,616		$	604,556,631		$	644,024,247
See notes to financial statements.

4

THE LION FUND II, L.P.

(A Delaware Limited Partnership)

STATEMENT OF CASH FLOWS

FOR THE YEARS ENDED DECEMBER 31, 2019, 2018 AND 2017

	2019			2018			2017
CASH FLOWS FROM OPERATING ACTIVITIES:
Net increase (decrease) in partners’ capital resulting from operations	$	78,604,057		$	(130,193,073	)	$	(35,739,740	)
Adjustments to reconcile net increase (decrease) in partners’ capital resulting from operations to net cash provided by (used in) operating activities:
Net realized (gains) losses from investments		(185,900,988	)		(27,874,223	)		768,420
Net change in unrealized appreciation - investments		131,898,804			189,452,895			77,377,962
Net change in unrealized appreciation - forward contract		—			—			(45,177,780	)
Cost of forward contract at maturity		—			—			30,500,593
Purchases of investments in securities		(28,386,587	)		(20,011,188	)		(9,539,412	)
Proceeds from sale of investments		416,063,175			79,863,534			595,064
Payment of forward contract		—			—			(165,596,093	)
Amortization of loan origination fees		327,181			751,076			423,896
Changes in due to broker		—			(328,261	)		(20,278,672	)
Changes in interest payable		(483,427	)		211,456			642,186
Changes in receivables		(19,889,744	)		—			1,619,240
Changes in accounts payable		(107,987	)		67,987			(497,298	)
Net cash provided by (used in) operating activities		392,124,484			91,940,203			(164,901,634	)
CASH FLOWS FROM FINANCING ACTIVITIES:
Contributions from partners		40,000,000			39,040,000			9,707,250
Distributions to partners		(183,560,000	)		(70,630,000	)		(19,709,975	)
Proceeds from long-term debt		—			—			198,497,846
Payments of long-term debt		(88,000,000	)		—			—
Net cash provided by (used in) financing activities		(231,560,000	)		(31,590,000	)		188,495,121
NET INCREASE IN CASH		160,564,484			60,350,203			23,593,487
CASH and CASH EQUIVALENTS — Beginning of year		83,943,690			23,593,487			—
CASH and CASH EQUIVALENTS — End of year	$	244,508,174		$	83,943,690		$	23,593,487
See notes to financial statements.

5

THE LION FUND II, L.P.

(A Delaware Limited Partnership)

CONDENSED SCHEDULE OF INVESTMENTS

AS OF DECEMBER 31, 2019:	Shares		Amount
INVESTMENTS IN COMMON STOCK AT FAIR VALUE:
United States:
Diversified:
Biglari Holdings Inc. Class A common stock (6.8%)		72,621	$	43,572,600
Biglari Holdings Inc. Class B common stock (12.9%)		726,218		83,093,864
Restaurant:
Cracker Barrel Old Country Store, Inc. (47.7%)		2,000,000		307,480,000
Retail:
Tiffany & Co (7.8%)		375,000		50,118,750
TOTAL SECURITIES OWNED (cost $525,408,283) (75.2%)			$	484,265,214
Percentages shown are computed based on the classification value compared to partners’ capital at December 31, 2019.
AS OF DECEMBER 31, 2018:	Shares		Amount
INVESTMENTS IN COMMON STOCK AT FAIR VALUE:
United States:
Diversified:
Biglari Holdings Inc. Class A common stock (6.1%)		72,621	$	42,677,184
Biglari Holdings Inc. Class B common stock (11.8%)		726,218		82,483,840
Restaurant:
Cracker Barrel Old Country Store, Inc. (98.9%)		4,322,218		690,949,769
Other				1,368,670
TOTAL SECURITIES OWNED (cost $722,282,640) (117.0%)			$	817,479,463
Percentages shown are computed based on the classification value compared to partners’ capital at December 31, 2018.
See notes to financial statements.

6

THE LION FUND II, L.P.

(A Delaware Limited Partnership)

Notes to Financial Statements

for the years eNDED December 31, 2019, 2018 and 2017

1. organization and Summary of Significant Accounting Policies

The Lion Fund II, L.P. (the “Fund”) is an investment fund organized as a limited partnership under the laws of the State of Delaware. The Fund is managed by Biglari Capital Corp. (the “General Partner”). The Fund commenced operations in July 2013 to provide investors with a professionally managed fund with the objective of achieving above-average, long-term growth of capital. In meeting this objective, the Fund will seek to find investments that the General Partner believes offer exceptional value.

Basis of Accounting — The accompanying financial statements of the Fund have been presented on the accrual basis of accounting, in accordance with generally accepted accounting principles (“GAAP”). The Fund is an investment company and therefore complies with accounting and reporting guidance presented in Accounting Standards Codification 946, Financial Services – Investment Companies.

Investments in Securities — Security transactions are accounted for on the date the securities are purchased or sold (trade date). Gains or losses from sales of investments are computed on the specific identification basis. Dividend income is recorded on the ex-dividend date. Interest income is recorded on the accrual basis.

Exchange-listed securities are valued at the last sale price on the principal exchange on which they are traded.

Receivables — The Fund’s receivable balance consists primarily of a note receivable from Fat Brands Inc. On January 29, 2019, the Fund and The Lion Fund, L.P. entered into a term loan with Fat Brands Inc. The interest rate for the term loan was 20% per annum. On March 10, 2020, Fat Brands Inc. repaid the loan in full.

As of December 31, 2019, the principal balance of the term loan with Fat Brands Inc. was $15,375,000. The Fund’s receivable balance as of December 31, 2019, also included a receivable of $3,500,000, accrued interest of $797,244 and a dividend receivable of $217,500.

Income Taxes — In accordance with federal income tax regulations, no income taxes are levied on a partnership, but rather on the individual partners. Consequently, no provision or liability for federal income taxes has been reflected in the accompanying financial statements.

There were neither liabilities nor deferred tax assets relating to uncertain income tax positions taken or expected to be taken on the tax returns. The Fund has reviewed open tax years and has concluded that there is no significant tax liability resulting from uncertain tax provisions. 2018, 2017 and 2016 remain open for both federal and state jurisdictions.

Cash and Cash Equivalents — Any highly liquid investments with a maturity of three months or less at the date of acquisition are considered cash equivalents. The cash and cash equivalent balances as of December 31, 2019 and 2018 represent cash held by the custodians of the Fund’s investments.

Advance Distributions — Advance distributions represent balances distributed as of year-end, which will be applied to partners’ capital as of the first of the following fiscal year. As of December 31, 2019, the Fund had advance distributions totaling $10,000,000.

7

Use of Estimates — The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Allocation of Net Increase (Decrease) from Operations — The Fund’s income and losses, including unrealized gains or losses and realized gains or losses from the sale of investments, are allocated to the partners in proportion to their respective capital accounts as of the end of each month.

Long-Term Debt — On June 7, 2017, the Fund entered into a $200,000,000 loan using shares of Cracker Barrel Old Country Store, Inc. as collateral. As of December 31, 2019 and 2018, the balance of the loan was $112,000,000 and $200,000,000, respectively. The Fund repaid the loan in full on March 18, 2020.

2. Concentrations of Credit Risk

The Fund does not clear its own securities transactions. It has established accounts with financial institutions for this purpose. This can, and often does, result in concentration of credit risk with one or more of these firms. Such risk, however, is mitigated by the obligation of U.S. financial institutions to comply with rules and regulations governing broker/dealers and futures commission merchants. These rules and regulations generally require maintenance of net capital, as defined, and segregation of customers’ funds and securities from holdings of the firm.

3. Related-party Transactions

The General Partner is entitled to receive a performance reallocation of 25% of the increase in net assets annually. This reallocation is subject to a 6% performance hurdle rate that the Fund’s performance must exceed in order for the General Partner to be entitled to such reallocation. Additionally, this reallocation is subject to a highwater mark provision. The General Partner did not earn a performance reallocation during 2019, 2018 and 2017.

Sardar Biglari is the Chairman, Chief Executive Officer and sole owner of the General Partner. Mr. Biglari is also the Chairman and Chief Executive Officer of Biglari Holdings Inc. (“Biglari Holdings”) and of Biglari Holdings’ wholly owned subsidiary, Steak n Shake Inc. (“Steak n Shake”). Biglari Holdings and Steak n Shake are limited partners in the Fund and are subject to pay their proportional share of performance reallocation.

During the first quarter of 2018, the Fund purchased 45,302 shares of Biglari Holdings Inc. common stock at an average price paid per share of $411.73. On April 30, 2018, all of the shares of Biglari Holdings Inc. common stock held by the Fund were converted into 72,621 shares of Biglari Holdings Inc. Class A common stock and 726,218 shares of Biglari Holdings Inc. Class B common stock. There were no purchases of Biglari Holdings common stock in 2019. 

The General Partner of the Fund also serves as the General Partner of The Lion Fund, L.P. The Lion Fund, L.P. is a limited partner in the Fund and is not subject to a performance reallocation. As of December 31, 2019, 2018 and 2017, Biglari Holdings, Steak n Shake and The Lion Fund, L.P. represented the limited partners in the Fund.

4. Fair Value MeasuremenTS

Exchange-listed securities are valued at the last sale price on the principal exchange on which they are traded.

Level 1 securities in accordance with the GAAP established fair value hierarchy are based on unadjusted quoted prices in active markets for identical assets and liabilities. As of December 31, 2019 and 2018, total securities were $484,265,214 and $817,479,463, respectively. As of December 31, 2019 and 2018, derivative balances were $2,226,670 and $1,766,516, respectively. The securities and derivatives are classified as Level 1 inputs within the GAAP established hierarchy.

8

Level 2 securities in accordance with the GAAP established fair value hierarchy are based on observable inputs other than those included in Level 1. As of December 31, 2019, the receivable balance was $19,889,744. The receivables are classified as Level 2 inputs within the GAAP established hierarchy.

5. Subsequent Events

We have evaluated subsequent events for recognition or disclosure through the time of issuance of these financial statements on March 30, 2020.

6. Financial Highlights

	2019			2018			2017
Total return before performance reallocation		11.99	%		(15.32	)%		(3.95	)%
Performance reallocation		0.00			0.00			0.00
Total return after performance reallocation		11.99	%		(15.32	)%		(3.95	)%

Supplemental Data
	2019			2018			2017
Annual gross partnership return		12.93	%		(14.23	)%		(2.83	)%
Annual net partnership return		11.84	%		(15.38	)%		(4.00	)%

Total return for limited partners is calculated for the limited partners as a whole and is measured by dividing the increase or decrease in net assets, net of the expenses and performance reallocation to the General Partner, into the weighted average limited partners’ capital measured at the end of each month. An individual limited partner’s return may vary from these returns based on the timing of capital transactions.

Gross partnership return is calculated for the Fund as a whole and is measured by dividing the total increase or decrease in net assets, before expenses, into the weighted average partners’ capital measured at the end of each month. The net partnership return is calculated in similar fashion, after expenses.

	2019			2018			2017
Ratio to average partners’ capital:
Expenses before performance reallocation		1.01	%		1.21	%		1.27	%
Performance reallocation		0.00			0.00			0.00
Expenses including performance reallocation		1.01	%		1.21	%		1.27	%
Net investment income		3.45	%		3.90	%		3.37	%

Average partners’ capital is determined using the Fund’s partners’ capital measured at the end of each month. The performance reallocation to the General Partner is not included in the net investment income ratio.

Expenses include accounting fees, interest and other expenses. Net investment income is computed as investment income from dividends and interest, less expenses.

9

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized, on March 30, 2020.

Biglari Holdings inc.
By:	/s/ Bruce Lewis
	Bruce Lewis Controller

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities indicated, on March 30, 2020.

Signature	Title
/s/ Sardar Biglari	Chairman of the Board and Chief Executive Officer (Principal Executive Officer)
Sardar Biglari
/s/ Bruce Lewis	Controller (Principal Financial and Accounting Officer)
Bruce Lewis
/s/ Philip L. Cooley	Director
Philip L. Cooley
/s/ Kenneth R. Cooper	Director
Kenneth R. Cooper
/s/ James P. Mastrian	Director
James P. Mastrian
/s/ Ruth J. Person	Director
Ruth J. Person

/s/ John G. Cardwell	Director
John G. Cardwell

10

INDEX TO EXHIBITS

Exhibit Number	Description
31.01	Rule 13a-14(a)/15d-14(a) Certification of Chief Executive Officer
31.02	Rule 13a-14(a)/15d-14(a) Certification of Controller
32.01	Section 1350 Certifications
99.01	Consent of The Lion Fund II, L.P.

The Lion Fund II Financial Statements are filed under Item 15(c).

11