Page 8 of 14 – SEC Filing
(f) Partners
LP is organized under the laws of the State of New York. Each of Focus Fund, Cibelli Research and Marathon Partners is organized
under the laws of the State of Delaware. Mr. Cibelli is a citizen of the United States of America.
| Item 3. | Source and Amount of Funds or Other Consideration. |
The Shares purchased
by each of Partners LP and Focus Fund were purchased with working capital (which may, at any given time, include margin loans made
by brokerage firms in the ordinary course of business) in open market purchases. The aggregate purchase price of the 800,000 Shares
beneficially owned by Partners LP is approximately $8,184,184, excluding brokerage commissions. The aggregate purchase price of
the 130,000 Shares beneficially owned by Focus Fund is approximately $1,332,803, excluding brokerage commissions.
| Item 4. | Purpose of Transaction. |
On August 4, 2017,
the Issuer and Fidelity National Financial, Inc. (“FNF”) announced a definitive agreement under which the Issuer will
acquire 99 Restaurants, LLC, a majority-owned enterprise of FNF in an all-stock transaction (“Proposed Transaction”)
valued at approximately $199 million, including the assumption of $20 million in net debt, and following which FNF will own approximately
52.5% of the outstanding shares of capital stock of Issuer.
On September 26, 2017,
Marathon Partners delivered a letter (the “Letter”) to the Issuer’s board of directors (the “Board”)
opposing the Proposed Transaction given its belief that the Proposed Transaction is overly accommodating to the interests of FNF
and other affiliated entities and clearly not in the best interests of the Issuer’s shareholders. Marathon Partners stated
in the Letter that it is highly concerned the Board’s deep and active ties to FNF are hindering the pursuit of alternative
options that could potentially result in better outcomes for shareholders.
In the Letter, Marathon
Partners noted numerous severe flaws and deficiencies with the Proposed Transaction, including:
| · | The complete lack of independence of the Board, where every member is affiliated in some way or another with FNF; |
| · | The failure of the Board to create a Special Committee to fully and fairly evaluate the Proposed Transaction against other available alternatives to maximize shareholder value; |
| · | The highly unorthodox go-shop provision for a buyer that appears to be favor for FNF at the expense of the Issuer’s shareholders; |
| · | The undervaluation of J. Alexander’s and use of an overly generous accretion analysis as an attempt to justify the Proposed Transaction; and |
| · | The incompatible strategic fit between J. Alexander’s and 99 Restaurants given the nature of the two distinctly contrasting dining concepts. |
Marathon Partners
stated in the Letter that J. Alexander’s fair value lies well above the $11 per share price used for the Proposed Transaction
and believes that the range of $13 to $15 is a more reasonable approximation of J. Alexander’s intrinsic value per share
that is supported by a variety of valuation methodologies, including the value of its real estate holdings.
| 8 |
