Cracker Barrel Confirms Biglari Holdings’ Rejection of Offer to Repurchase Its Shares

  Cracker Barrel Confirms Biglari Holdings’ Rejection of Offer to Repurchase
  Its Shares

Business Wire

LEBANON, Tenn. -- February 15, 2013

Cracker Barrel Old Country Store, Inc. (Nasdaq: CBRL) confirmed today that
Biglari Holdings Inc. has rejected the Company’s offer to repurchase at market
price all 4,737,794 Cracker Barrel shares currently held by Biglari Holdings
and its affiliates.

Sardar Biglari, chairman and chief executive officer of Biglari Holdings,
failed by a wide margin of shareholder votes in his attempts to gain Board
representation through proxy contests in both 2012 and 2011.

"We are disappointed that Mr. Biglari has rejected our good-faith offer," said
Sandra B. Cochran, Chief Executive Officer of Cracker Barrel. "We continue to
believe it would be in the best interests of the Company for Mr. Biglari to
exit, avoiding the expense and distraction of a third proxy fight and allowing
us to move forward uninterrupted in the fulfillment of our business plans. We
will continue to focus on delivering excellent results for customers and

The text of the letter to Mr. Biglari outlining the offer follows.

February 13, 2013

Dear Sardar

We are writing on behalf of the Board of Directors of Cracker Barrel Old
Country Store, Inc. (“Cracker Barrel”) to offer a buyback of the 4,737,794
shares of Cracker Barrel common stock currently held by Biglari Holdings Inc.
and its affiliates (collectively, “Biglari Holdings”) at market price (subject
to any adjustments that may be required by applicable Tennessee law). As our
intention is to act in the best interests of all our shareholders and avoid a
third consecutive costly and disruptive proxy contest, our Board has
authorized us to make this offer to provide an efficient exit of Biglari
Holdings’ position. We would note that we have spoken with other shareholders
who have encouraged us to provide you with the opportunity to exit your
position in Cracker Barrel by means of a buyback. Having previously conveyed
to you our interest in exploring a buyback on November 30, 2012 and as
recently as earlier today, our Board believes it is now appropriate to make
this offer in writing. We welcome a dialogue with you concerning our proposal.

We respect Biglari Holdings’ ownership of Cracker Barrel stock and interest in
the company. However, your proxy contests of 2011 and 2012, in which our
shareholders decided not to elect you to the Board, have imposed significant
financial costs on the Company and diverted meaningful time away from focusing
on the strategic plan and maximizing shareholder value by our Board and
management team. In each of the last two years, you rejected our good faith
settlement offers of two board seats for independent directors chosen by you.
Given this history, we assume that you remain intent on seeking a Board seat
for yourself personally, despite the clear preference of our shareholders to
the contrary. As an alternative to another proxy contest, we believe the
buyback transaction we propose here would serve the best interests of the
Company and our shareholders.

Our analysis of block trades and sell down programs shows that a meaningful
discount would be typical if you were to exit on your own over a longer period
of time. By contrast, our offer provides immediate price certainty to Biglari
Holdings’ shareholders and allows for the monetization of an approximately $70
million appreciation in the value of the Cracker Barrel common stock acquired
by Biglari Holdings since June 2011. Moreover, this accretive transaction
would serve the best interests of all Cracker Barrel shareholders by enabling
the Company to continue executing our sound business strategy without the
threat of yet another costly and disruptive proxy contest. We are confident in
our ability to complete the transaction promptly.

In order to proceed in a timely manner, we kindly ask for your indication of
interest regarding further discussions in writing no later than February 20,
2013. If not provided by that date, we will assume that you have rejected our
offer. If you indicate your readiness to move forward with this buyback, we
will work with you promptly to negotiate definitive transaction agreements. We
expect that the definitive agreements would include a three-year standstill
restricting Biglari Holdings from acquiring shares of Cracker Barrel or taking
other actions such as a proxy contest. Of course, as is customary in
communications of this nature, our offer is being presented as a non-binding
proposal, and any transaction will be subject to the execution of definitive
transaction agreements by all applicable parties.

We hope that this letter gives you complete clarity with respect to our offer.
We look forward to hearing from you.


James W. Bradford, Jr.
Chairman of the Board

Sandra B. Cochran
President and Chief Executive Officer

About Cracker Barrel Old Country Store

Cracker Barrel Old Country Store, Inc. ^ provides a friendly
home-away-from-home in its old country stores and restaurants. Guests are
cared for like family while relaxing and enjoying real home-style food and
shopping that's surprisingly unique, genuinely fun and reminiscent of
America's country heritage…all at a fair price. The restaurant serves up
delicious, home-style country food such as meatloaf and homemade chicken n'
dumplins as well as its made from scratch biscuits using an old family recipe.

The authentic old country retail store is fun to shop and offers unique gifts
and self-indulgences. Cracker Barrel Old Country Store, Inc. (Nasdaq: CBRL)
was established in 1969 in Lebanon, Tenn. and operates 621 company-owned
locations in 42 states. Every Cracker Barrel unit is open seven days a week
with hours Sunday through Thursday, 6 a.m. — 10 p.m., and Friday and Saturday,
6 a.m. - 11 p.m. For more information, visit



For Cracker Barrel
Lawrence E. Hyatt, 615-235-4432
Senior Vice President and Chief Financial Officer
MacKenzie Partners, Inc.
Mark Harnett, 212-929-5877
For Cracker Barrel
Jeanne Ludington, 615-443-9115
Corporate Communications Manager
Kekst and Company
Ruth Pachman, 212-521-4891
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