Engaged Capital Amends BRC Inc. Stake Filing

TL;DR

Engaged Capital just updated their BRC Inc. filing - something's up.

AI Summary

Engaged Capital, LLC, a significant shareholder, has filed an amendment (Amendment No. 7) to its Schedule 13D for BRC Inc. on September 17, 2024. This filing indicates a change in their holdings or intentions regarding BRC Inc. stock. Engaged Capital, led by Glenn W. Welling, is based in Newport Beach, California.

Why It Matters

This amendment signals a potential shift in strategy or ownership for BRC Inc. from a major investor, which could influence the company's future direction.

Risk Assessment

Risk Level: medium — Amendments to Schedule 13D filings often indicate changes in activist investor strategy, which can lead to increased volatility.

Key Players & Entities

• Engaged Capital, LLC (company) — Filing entity and significant shareholder
• BRC Inc. (company) — Subject company
• Glenn W. Welling (person) — Key individual associated with Engaged Capital
• Ryan Nebel (person) — Legal counsel associated with Engaged Capital
• Olshan Frome Wolosky LLP (company) — Legal counsel for Engaged Capital

FAQ

Key Financial Figures

• $0.0001 — ssuer) Class A Common Stock, par value $0.0001 per share (Title of Class of Securiti
• $93,750,000 — aster, the aggregate cost for which was $93,750,000, were purchased with working capital, p
• $10,000,000 — aster, the aggregate cost for which was $10,000,000, were purchased with working capital, p
• $3,595,444 — aster, the aggregate cost for which was $3,595,444, including brokerage commissions, were
• $3.17 — o purchase 684,542 Shares at a price of $3.17 per Share. The Purchase Agreement conta

Filing Documents

• sc13da709455048_09162024.htm (SC 13D/A) — 126KB
• ex991to13da709455048_091624.htm (EX-99.1) — 50KB
• 0000921895-24-002138.txt ( ) — 177KB

Source and Amount of Funds or Other Consideration

Item 3. Source and Amount of Funds or Other Consideration .

is hereby amended

Item 3 is hereby amended and restated to read as follows: 9,375,000 of the Shares beneficially owned directly by Engaged Capital Flagship Master, the aggregate cost for which was $93,750,000, were purchased with working capital, pursuant to the Forward Purchase Agreement (as previously defined and described in Item 4 of the Schedule 13D). 1,000,000 of the Shares beneficially owned directly by Engaged Capital Flagship Master, the aggregate cost for which was $10,000,000, were purchased with working capital, pursuant to the Subscription Agreement (as previously defined and described in Item 4 of the Schedule 13D). 125,000 of the Shares beneficially owned directly by Engaged Capital Flagship Master were acquired pursuant to the Distribution (as previously defined and described in Item 2 of Amendment No. 1 to the Schedule 13D). 1,951,018 of the Shares beneficially owned directly by Engaged Capital Flagship Master were acquired pursuant to the SilverBox Distribution (as defined in Amendment No. 2 to the Schedule 13D). 1,084,542 of the Shares beneficially owned directly by Engaged Capital Flagship Master, the aggregate cost for which was $3,595,444, including brokerage commissions, were purchased with working capital. 100,000 of the Shares held by the Welling Family Trust (the “Welling Trust”), which Mr. Welling may be deemed to beneficially own as trustee of the Welling Trust, were acquired pursuant to the Distribution. 406,092 of the Shares held by the Welling Trust were acquired in connection with the SilverBox Distribution. Mr. Welling has also been awarded an aggregate of 121,524 restricted stock units (“RSUs”) under the Issuer’s 2022 Omnibus Incentive Plan in connection with his service as a director of the Issuer, of which 72,823 RSUs have vested or vest within 60 days of the date hereof. Each RSU represents a contingent right to receive one Share upon settlement for no consideration, which will be delivered to Mr. Welling following

Purpose of Transaction

Item 4. Purpose of Transaction .

is hereby amended

Item 4 is hereby amended to add the following: On September 13, 2024, Engaged Capital Flagship Master entered into a Stock Purchase Agreement (the “Purchase Agreement”) with EKNRH Holdings LLC, an entity controlled by Evan Hafer, the Executive Chair of the Issuer, whereby Engaged Capital Flagship Master agreed to purchase 684,542 Shares at a price of $3.17 per Share. The Purchase Agreement contains customary representations, warranties and covenants of the parties thereto. Pursuant to the Purchase Agreement, settlement of the transaction shall occur within two business days of the date thereof. The foregoing description of the Purchase Agreement does not purport to be complete and is qualified in its entirety by reference to the Purchase Agreement, which is attached as Exhibit 99.1 hereto and is incorporated herein by reference.

Interest in Securities of the Issuer

Item 5. Interest in Securities of the Issuer . Items 5(a) and (c) are hereby amended and restated to read as follows: (a) The aggregate percentage of Shares reported owned by each person named herein is based upon 70,639,046 Shares outstanding as of July 31, 2024, which is the total number of Shares outstanding as reported in the Issuer’s Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission on August 7, 2024. 6 CUSIP No. 05601U105 As of the date hereof, Engaged Capital Flagship Master directly beneficially owned 13,535,560 Shares, constituting approximately 19.2% of the Shares outstanding. As of the date hereof, 506,092 Shares were held in the Welling Trust, constituting less than 1% of the Shares outstanding. As of the date hereof, Mr. Welling directly beneficially owned 72,823 Shares (including 5,093 Shares underlying certain RSUs that vest within 60 days of the date hereof), constituting less than 1% of the Shares outstanding. Engaged Capital, as the general partner and investment adviser of Engaged Capital Flagship Master, may be deemed to beneficially own the 13,535,560 Shares owned by Engaged Capital Flagship Master, constituting approximately 19.2% of the Shares outstanding. Engaged Holdings, as the managing member of Engaged Capital, may be deemed to beneficially own the 13,535,560 Shares owned by Engaged Capital Flagship Master, constituting approximately 19.2% of the Shares outstanding. Mr. Welling, (i) as the Founder and CIO of Engaged Capital and sole member of Engaged Holdings, may be deemed to beneficially own the 13,535,560 Shares owned by Engaged Capital Flagship Master, and (ii) as trustee of the Welling Trust, may be deemed to beneficially own the 506,092 Shares held in the Welling Trust, which, together with the Shares he beneficially owns directly, constitutes an aggregate of 14,114,475 Shares, constituting approximately 20.0% of the Shares outstanding. The filing of this Schedule 13D shall not be deem

Contracts, Arrangements, Understandings or Relationships With Respect to Securities of the Issuer

Item 6. Contracts, Arrangements, Understandings or Relationships With Respect to Securities of the Issuer .

is hereby amended

Item 6 is hereby amended to add the following: On September 13, 2024, Engaged Capital Flagship Master and EKNRH Holdings LLC entered into the Purchase Agreement as defined and described in Item 4 above and attached as Exhibit 99.1 hereto.

Material to be Filed as Exhibits

Item 7. Material to be Filed as Exhibits .

is hereby

Item 7 is hereby amended to add the following exhibit: 99.1 Purchase Agreement, dated September 13, 2024. 7 CUSIP No. 05601U105

SIGNATURES

SIGNATURES After reasonable inquiry and to the best of his knowledge and belief, the undersigned certifies that the information set forth in this statement is true, complete and correct. Dated: September 17, 2024 Engaged Capital Flagship Master Fund, LP By: Engaged Capital, LLC General Partner By: /s/ Glenn W. Welling Name: Glenn W. Welling Title: Founder and Chief Investment Officer Engaged Capital, LLC By: /s/ Glenn W. Welling Name: Glenn W. Welling Title: Founder and Chief Investment Officer Engaged Capital Holdings, LLC By: /s/ Glenn W. Welling Name: Glenn W. Welling Title: Sole Member /s/ Glenn W. Welling Glenn W. Welling 8

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