Insurance company rejects Steak n Shake takeover bid

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A small Michigan insurer has rejected an acquisition bid from The Steak n Shake Co., describing the offer as a "hostile
takeover attempt."

Fremont Michigan InsuraCorp said in a statement Wednesday that the company’s board, after receiving
advice from its attorneys and financial advisers, voted unanimously that the bid "should be rejected
and that execution of the Company’s current strategic plans represents a better long-term value for our

"Our board, management team, associates and agents are focused on
continuing to grow our business and maximize the value of the company, and we believe this hostile takeover
attempt is not in the best interest of Fremont, our shareholders, our policyholders or the Fremont community,"
Richard E. Dunning, Fremont’s CEO said in a statement.

Steak n Shake, an Indianapolis-based burger
chain that’s now operated as a holding company by activist-investor-turned-CEO Sardar Biglari, offered late Monday to
acquire the outstanding shares of Fremont for $24.50 per share in cash and stock, an 11.3 percent premium to Monday’s closing
price. The company provides property and casualty insurance to individuals, farms and small businesses in Michigan.

Steak n Shake disclosed that it had purchased a roughly 10-percent stake in Fremont in October, shortly after Biglari said
he intended to transform Steak n Shake into a holding company to pursue purchases “either related or unrelated
to its ongoing business activities.”

The company has not revealed its plans for Fremont, but observers say
Biglari wants to use the firm’s $60 million investment portfolio to fund more acquisitions, following in the footsteps of
his investing hero, Warren Buffett. Buffett’s Berkshire Hathaway acquired its first insurer in the 1960s and now funds billions
of dollars in investments through the portfolios of its insurance companies.

Steak n Shake shares were down about
1 percent in trading Wednesday morning, to $323.55. Fremont shares were down almost 3 percent, to $24.80

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