What changed in this filing

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Item 8. Financial Statements and Supplementary Data

2026-09-25 compared with 2025-09-26 · 160 added, 145 removed, 654 unchanged (32% of the section changed)

4 unchanged sentences

We have audited the accompanying consolidated balance sheets of Cracker Barrel Old Country Store, Inc.

and subsidiaries (the "Company") as of August 1, 2025, and August 2, 2024, and the related consolidated statements of income, changes in shareholders’ equity, and cash flows, for each of the three years in the period ended August 1, 2025, and the related notes (collectively referred to as the "financial statements").

In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of August 1, 2025, and August 2, 2024, and the results of its operations and its cash flows for each of the three years in the period ended August 1, 2025, in conformity with accounting principles generally accepted in the United States of America.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company’s internal control over financial reporting as of August 1, 2025, based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated September 26, 2025, expressed an unqualified opinion on the Company’s internal control over financial reporting.

and subsidiaries (the "Company") as of July 31, 2026, and August 1, 2025, and the related consolidated statements of income, changes in shareholders’ equity, and cash flows, for each of the three years in the period ended July 31, 2026, and the related notes (collectively referred to as the "financial statements").

In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of July 31, 2026, and August 1, 2025, and the results of its operations and its cash flows for each of the three years in the period ended July 31, 2026, in conformity with accounting principles generally accepted in the United States of America.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company’s internal control over financial reporting as of July 31, 2026, based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated September 25, 2026, expressed an unqualified opinion on the Company’s internal control over financial reporting.

Basis for Opinion

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The reserves and losses in the actuarial study represent a range of possible outcomes within which no given estimate is more likely than any other estimate.

Using this information, the Company records the expected losses in the lower half of the range, which is discounted to present value using a risk-free interest rate.

Using this information, the Company records the expected losses at the midpoint of the range, which is discounted to present value using a risk-free interest rate.

The Company also monitors actual claims development as another means of estimating the adequacy of the historical reserves.

We identified insurance reserves as a critical audit matter because estimating the reserve for all unresolved claims and IBNR claims involves significant estimation by management.

This required a high degree of auditor judgment and an increased extent of effort, including the need to involve our actuarial specialists, when performing audit procedures to evaluate whether insurance reserves were appropriately recorded as of August 1, 2025.

How the Critical Audit Matter Was Addressed in the Audit

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August 01,2025

August 02,2024

Current Assets:

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Total current assets

Property and equipment

Buildings and improvements

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Fiscal years ended

July 31, 2026

August 01, 2025

August 02, 2024

July 28, 2023

Total revenue

3 unchanged sentences

General and administrative expenses

Gain on sale and leaseback transactions, net

Impairment and store closing costs

Goodwill impairment

Operating income

Loss on sale of business assets

Operating income (loss)

Other income:

Gain on extinguishment of debt

Litigation settlement income

Interest expense, net

Income before income taxes

Provision for income taxes (income tax benefit)

Income tax benefit

Net income per share:

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Issuance of share-based compensation awards, net of shares withheld for employee taxes

Purchases and retirement of common stock

Balances at July 28, 2023

Total comprehensive income

Cash dividends declared - $ 4.15 per share

Share-based compensation

Issuance of share-based compensation awards, net of shares withheld for employee taxes

Balances at August 02, 2024

8 unchanged sentences

Balances at August 01, 2025

Total comprehensive income

Cash dividends declared - $ 1.00 per share

Share-based compensation

Issuance of share-based compensation awards, net of shares withheld for employee taxes

Balances at July 31, 2026

See Notes to Consolidated Financial Statements

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Fiscal years ended

July 31, 2026

August 01, 2025

August 02, 2024

July 28, 2023

Cash flows from operating activities:

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Loss on disposition of property and equipment

Gain on sale and leaseback transaction, net

Goodwill impairment

Loss on sale of business assets

Share-based compensation

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Proceeds from insurance recoveries of property and equipment

Proceeds from sale of property and equipment

Proceeds from sale of property and equipment, net

Net cash used in investing activities

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Taxes withheld from issuance of share-based compensation awards

Purchases and retirement of common stock

Deferred financing costs

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Fiscal year – The Company’s fiscal year ends on the Friday nearest July 31st and each quarter consists of thirteen weeks unless noted otherwise.

The periods presented in the Company’s financial statements are the fiscal years ended August 01, 2025 (“2025”), August 02, 2024 (“2024”) and July 28, 2023 (“2023”), respectively.

The periods presented in the Company’s financial statements are the fiscal years ended July 31, 2026 (“2026”), August 01, 2025 (“2025”) and August 02, 2024 (“2024”), respectively.

Each of these periods has 52 weeks except for 2024, which consisted of 53 weeks.

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Retail inventories valued using RIM are stated at the lower of cost or market.

Cost of restaurant inventory and retail inventory valued using moving average cost are stated at the lower of cost and net realizable value.

Cost of restaurant inventory and retail inventory valued using moving average cost are stated at the lower of cost or net realizable value.

See Note 3 for additional information regarding the components of inventory.

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See Note 8 for additional information regarding impairment charges in 2026, 2025 and 2024 related to right-of-use assets.

Other intangible assets – Intangibles primarily consist of the MSBC tradename and liquor licenses.

The MSBC tradename was capitalized as an indefinite-lived intangible asset and, at both August 01, 2025 and August 02, 2024, was $ 20,960 .

Other intangible assets – Intangibles primarily consist of transferable liquor licenses, which are capitalized as indefinite-lived intangible assets.

The costs of obtaining non-transferable liquor licenses that are directly issued by local government agencies for nominal fees are expensed as incurred.

The costs of purchasing transferable liquor licenses through open markets in jurisdictions with a limited number of authorized liquor licenses are capitalized as indefinite-lived intangible assets.

Liquor licenses capitalized as intangible assets were $ 3,365 at both August 01, 2025 and August 02, 2024.

Liquor licenses capitalized as intangible assets were $ 3,365 at both July 31, 2026 and August 01, 2025 on the Consolidated Balance Sheets.

Prior to the sale of certain assets used in the Maple Street Biscuit Company (“MSBC”) business in July 2026, intangible assets also included the MSBC tradename, which was capitalized as an indefinite-lived intangible asset.

As part of the transaction, the Company sold the MSBC tradename.

At August 01, 2025, the MSBC tradename was $ 20,960 on the Consolidated Balance Sheet.

Segment reporting – Operating segments are components of an enterprise about which separate financial information is available that is evaluated regularly by the chief operating decision maker in deciding how to allocate resources and in assessing performance.

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The Company recognizes revenues from retail sales when payment is tendered at the point of sale, as the Company’s performance obligation to provide merchandise is satisfied.

Ecommerce sales, including shipping revenue, are recorded upon delivery to the customer.

E-commerce sales, including shipping revenue, are recorded upon delivery to the customer.

Additionally, the Company provides for estimated returns based on return history and sales levels.

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The reserves and losses in the actuarial study represent a range of possible outcomes within which no given estimate is more likely than any other estimate.

As such, the Company records the losses at the lower half of that range and discounts them to present value using a risk-free interest rate based on projected timing of payments.

As such, the Company records the losses at the midpoint of that range and discounts them to present value using a risk-free interest rate based on projected timing of payments.

The Company also monitors actual claims development, including incurrence or settlement of individual large claims during the interim periods between actuarial studies as another means of estimating the adequacy of its reserves.

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The outstanding stock options and nonvested stock awards and units issued by the Company represent the only dilutive effects on diluted consolidated net income per share.

The 2026 Notes, the 2030 Notes and the warrants related to the 2026 Notes are calculated using the net share settlement option under the if-converted method.

Because the principal amount of the 2026 Notes and the 2030 Notes will be settled in cash with any excess conversion value settled in cash or shares of common stock, the 2026 Notes and the 2030 Notes have been excluded from the computation of diluted consolidated net income per share because the average market price of the Company’s common stock during the reporting period did not exceed the conversion prices of $ 156.34 and $ 72.23 , respectively.

Prior to their repayment in full at maturity during the fourth quarter of 2026, the 2026 Notes were evaluated under the net share settlement option under the if-converted method.

The 2026 Notes were excluded from the computation of diluted consolidated net income per share because the average market price of the Company’s common stock during the period the 2026 Notes were outstanding did not exceed the applicable conversion price.

The 2030 Notes and the warrants related to the 2026 Notes are also evaluated using the net share settlement option under the if-converted method.

Because the principal amount of the 2030 Notes will be settled in cash with any excess conversion value settled in cash or shares of common stock, the 2030 Notes have been excluded from the computation of diluted consolidated net income per share because the average market price of the Company’s common stock during the reporting period did not exceed the conversion price of $ 72.23 .

Warrants were excluded from the computation of diluted consolidated net income per share since the warrants’ strike price of $ 213.13 was greater than the average market price of the Company’s common stock during the reporting period.

See Note 4 for additional information regarding the 2026 Notes and the 2030 Notes and Note 15 for additional information regarding additional information regarding net income per share.

Recent Accounting Pronouncements Adopted

Segment Disclosures

In November 2023, the Financial Accounting Standards Board (“FASB”) issued new reportable segment disclosure requirements which require incremental segment information related to measuring segment performance on an annual and interim basis.

These new disclosure requirements are effective for the fiscal periods beginning after December 15, 2023 and interim periods within fiscal years beginning after December 15, 2024.

These disclosure requirements should be applied on a retrospective basis.

The adoption of this guidance had no impact on the Company’s consolidated financial position or results of operations.

See Note 6 for the Company’s segment disclosures.

Debt With Conversion and other Options

In November 2024, the FASB issued guidance which clarifies the accounting for settlements of convertible debt instruments that include inducement offers, specifically when the consideration transferred includes all amounts (in form and amount) issuable under the original conversion terms of the instrument.

Under the new guidance, if the inducement offer includes all consideration issuable under the original conversion privileges, the transaction is accounted for as an induced conversion, and only the fair value of any additional consideration is recognized as an expense.

No gain or loss is recognized on the conversion of the original debt.

If the criteria are not met, the transaction is accounted for as a debt extinguishment.

This guidance is effective for all entities for annual reporting periods.

Early adoption is permitted.

The Company early adopted this guidance on a retrospective basis in the fourth quarter of 2025.

See Note 4 for a discussion of the Company’s repurchase of $ 150,000 aggregate principal amount of the 2026 Notes.

This transaction did not qualify as an induced conversion under this new guidance.

Recent Accounting Pronouncements Not Yet Adopted

Recent Accounting Pronouncement Adopted

Income Tax Disclosures

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These new disclosure requirements are effective for annual periods beginning after December 15, 2024 and allow for adoption on a prospective basis, with a retrospective option.

The Company is currently evaluating the effect of adopting these new disclosure requirements on its consolidated financial statements and related disclosures in 2026.

The Company adopted these disclosure requirements on a retrospective basis for all reporting periods presented as of July 31, 2026.

The adoption of the guidance had no impact on the Company’s consolidated financial position or results of operations.

See Note 14 for the Company’s income tax disclosures.

Recent Accounting Pronouncement Not Yet Adopted

Disaggregation of Income Statement Expense

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● Significant Unobservable Inputs (“Level 3”) – unobservable and significant to the fair value measurement of the asset or liability.

The Company’s assets and liabilities measured at fair value on a recurring basis at August 01, 2025 were as follows:

The Company’s assets and liabilities measured at fair value on a recurring basis at July 31, 2026 were as follows:

Total Fair

Cash equivalents*

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See Note 11 for additional information regarding the Company’s Non-Qualified Savings Plan.

The Company did no t have any liabilities measured at fair value on a recurring basis at August 01, 2025 and August 02, 2024.

The Company did no t have any liabilities measured at fair value on a recurring basis at July 31, 2026 and August 01, 2025.

The Company’s money market fund investments are measured at fair value using quoted market prices.

The Company’s deferred compensation plan assets are measured based on net asset value per share as a practical expedient to estimate fair value.

The fair values of accounts receivable and accounts payable at August 01, 2025 and August 02, 2024, approximate their carrying amounts because of their short duration.

The fair value of the Company’s variable rate debt, based on quoted market prices, which are considered Level 1 inputs, approximates its carrying amounts at August 01, 2025 and August 02, 2024.

The fair values of accounts receivable and accounts payable at July 31, 2026 and August 01, 2025, approximate their carrying amounts because of their short duration.

The fair value of the Company’s variable rate debt, based on quoted market prices, which are considered Level 1 inputs, approximates its carrying amounts at July 31, 2026 and August 01, 2025.

The Company’s financial instruments that are not remeasured at fair value include the 2026 Notes and the 2030 Notes.

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The Company estimates the fair value of the 2026 Notes and 2030 Notes through consideration of quoted market prices of similar instruments, classified as Level 2 as described above.

The estimated fair value of the 2026 Notes was $ 144,075 and $ 267,939 as of August 01, 2025 and August 02, 2024, respectively.

The 2026 Notes were repaid in full at maturity during the fourth quarter of 2026.

The estimated fair value of the 2026 Notes was $ 144,075 as of August 01, 2025.

The estimated fair value of the 2030 Notes was $ 365,700 and $ 374,246 , respectively, as of July 31, 2026 and August 01, 2025.

Assets Measured at Fair Value on a Nonrecurring Basis

In 2026, nine Cracker Barrel stores were determined to be impaired because of declining operating performance.

The Company also recorded impairment charges in 2026 related to sixteen MSBC locations in connection with the divestiture of the MSBC business.

See Note 13 for additional information regarding the divestiture of the MSBC business.

In 2025, seven Cracker Barrel stores and twenty-five MSBC locations were determined to be impaired because of declining operating performance.

In 2024, six Cracker Barrel stores and thirteen MSBC locations were determined to be impaired because of declining operating performance.

Fair value of these locations was determined by sales prices of comparable assets or estimates of discounted future cash flows considering their highest and best use.

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The Company has determined that the majority of the inputs used to value its long-lived assets held and used are unobservable inputs, and thus, are considered Level 3 inputs.

Based on its analysis, the Company recorded impairment charges of $ 19,772 and $ 17,448 , respectively, in 2025 and 2024, which is included in the impairment and store closing costs line on the Consolidated Statements of Income.

In 2024, based on the Company’s analysis of MSBC’s goodwill, the Company concluded that the goodwill was impaired based on changes in the macroeconomic environment, including interest rate and inflationary pressures, and declining financial trends, which resulted in a calculated fair value lower than the goodwill’s carrying value.

As part of its analysis, the Company used the discounted cash flow method to estimate fair value.

Significant inputs for this method include projected cash flows, growth rate and discount rate.

The Company recorded an impairment of the entire goodwill amount of $ 4,690 in 2024;

this amount is recorded in the goodwill impairment line on the Consolidated Statements of Income.

Based on its analysis, the Company recorded impairment charges of $ 13,027 and $ 19,772 , respectively, in 2026 and 2025, related to long-lived assets measured at fair value on a nonrecurring basis.

Such charges are included in the impairment and store closing costs line on the Consolidated Statements of Income.

Inventories were comprised of the following at:

August 01, 2025

July 31, 2026

August 01, 2025

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In accordance with the 2025 Revolving Credit Facility, outstanding borrowings bear interest, at the Company’s election, either at (1) the Term Secured Overnight Financing Rate (SOFR), plus an applicable margin based on the Company’s consolidated total leverage ratio (the “Applicable Margin”) or (2) a base rate equal to the greatest of (i) the prime rate, (ii) a rate that is 0.5 % in excess of the Federal Funds Rate, and (iii) one-month Term SOFR plus 1.0 %, in each case, plus an Applicable Margin.

At August 01, 2025, the Company had no borrowings under the 2025 Revolving Credit Facility.

At August 02, 2024, the Company had $ 180,000 in outstanding borrowings with a weighted average interest rate of 7.19 % under the 2022 Revolving Credit Facility.

At August 01, 2025, the Company had $ 34,004 of standby letters of credit, which reduce the Company’s borrowing availability under the 2025 Revolving Credit Facility.

At both July 31, 2026 and August 01, 2025, the Company had no borrowings under the 2025 Revolving Credit Facility.

At July 31, 2026, the Company had $ 8,703 of standby letters of credit, which reduce the Company’s borrowing availability under the 2025 Revolving Credit Facility.

See Note 16 regarding the standby letters of credit.

At August 01, 2025, the Company had $ 515,996 in borrowing availability under the 2025 Revolving Credit Facility.

The 2025 Revolving Credit Facility contains customary financial covenants, which include maintenance of a maximum consolidated total leverage ratio and a minimum consolidated interest coverage ratio.

At August 01, 2025, the Company was in compliance with all financial covenants under the 2025 Revolving Credit Facility.

At July 31, 2026, the Company had $ 541,297 in borrowing availability under the 2025 Revolving Credit Facility.

The 2025 Revolving Credit Facility contains customary financial covenants, which include maintenance of a maximum consolidated senior secured leverage ratio and a minimum consolidated interest coverage ratio.

At July 31, 2026, the Company was in compliance with all financial covenants under the 2025 Revolving Credit Facility.

The 2025 Revolving Credit Facility also imposes restrictions on the amount of dividends the Company is permitted to pay and the amount of shares the Company is permitted to repurchase.

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Convertible Senior Notes

On June 18, 2021, the Company completed a private offering of $ 300,000 aggregate principal amount of its 0.625 % convertible Senior Notes due in 2026 (the “2026 Notes”) which included the exercise in full of the initial purchasers’ option to purchase up to an additional $ 25,000 principal amount of the 2026 Notes.

The 2026 Notes are governed by the terms of an indenture between the Company and U.S.

Bank National Association as the Trustee.

The 2026 Notes will mature on June 15, 2026 , unless earlier converted, repurchased or redeemed.

The 2026 Notes bear cash interest at an annual rate of 0.625 %, payable semi-annually in arrears on June 15 and December 15 of each year.

The 2026 Notes are unsecured obligations and do not contain any financial or operating covenants or restrictions on the payments of dividends, the incurrence of indebtedness or the issuance or repurchase of securities by the Company or any of its subsidiaries.

Upon the occurrence of an event of default, the principal amount of, and all accrued and unpaid interest on, all of the notes then outstanding will immediately become due and payable.

However, notwithstanding the foregoing, the Company may elect, at its option, that the sole remedy for an event of default relating to certain failures by the Company to comply with certain reporting covenants in the Indenture will consist exclusively of the right of the noteholders to receive special interest on the 2026 Notes for up to 180 calendar days during which such event of default has occurred and is continuing, at a specified rate for the first 90 days of 0.25 % per annum, and thereafter at a rate of 0.50 % per annum, on the principal amount of the 2026 Notes.

The initial conversion rate applicable to the 2026 Notes was 5.3153 shares of the Company’s common stock per $ 1,000 principal amount of 2026 Notes, which represented an initial conversion price of approximately $ 188.14 per share of the Company’s common stock, a premium of 25.0 % over the last reported sale price of $ 150.51 per share on June 15, 2021, the date on which the 2026 Notes were priced.

The conversion rate is subject to customary adjustments upon the occurrence of certain events, including for the payment of dividends to holders of the Company’s common stock.

On August 01, 2025, the conversion rate, as adjusted, was 6.3962 shares of the Company’s common stock per $ 1,000 principal amount of the 2026 Notes.

In addition, if certain corporate events that constitute a “Make-Whole Fundamental Change” occur, then the conversion rate will, in certain circumstances, be increased for a specified period of time.

Net proceeds from the 2026 Notes offering were approximately $ 291,000 , after deducting the initial purchasers’ discounts and commissions and the Company’s offering fees and expenses.

Contemporaneously with the 2030 Notes offering described below, the Company used approximately $ 145,900 of the net proceeds from the 2030 Notes for the repurchase of $ 150,000 aggregate principal amount of 2026 Notes in separate and privately negotiated transactions and recorded a gain on extinguishment of debt of $ 3,186 .

On June 18, 2021, the Company completed a private offering of $ 300,000 aggregate principal amount of its 0.625 % convertible Senior Notes due in 2026 (the “2026 Notes”).

On June 13, 2025, contemporaneously with the 2030 Notes offering described below, the Company used approximately $ 145,900 of the net proceeds from the 2030 Notes for the repurchase of $ 150,000 aggregate principal amount of the 2026 Notes in separate and privately negotiated transactions and recorded a gain on extinguishment of debt of $ 3,186 .

This amount is recorded in the gain on extinguishment of debt line on the Consolidated Statements of Income.

During any calendar quarter preceding September 30, 2021, in which the closing price of the Company’s common stock exceeds 130 % of the applicable conversion price of the 2026 Notes on at least 20 of the last 30 consecutive trading days of the quarter, holders may in the immediate quarter following, convert all or a portion of their 2026 Notes.

When a conversion notice is received, the Company has the option to pay or deliver the conversion amount entirely in cash or a combination of cash and shares of the Company’s common stock.

The holders of the 2026 Notes were not eligible to convert their 2026 Notes during 2025, 2024, 2023 or 2022.

Accordingly, as August 02, 2024, the Company could not be required to settle the 2026 Notes in cash and, therefore, the 2026 Notes were classified as long-term debt.

As of August 01, 2025, the 2026 Notes are classified as a current liability due to their maturity date in 2026.

The following table includes the outstanding principal amount and carrying value of the 2026 Notes as of the periods indicated:

August 01, 2025

The remaining $ 150,000 aggregate principal amount of the 2026 Notes was paid in full at maturity on June 15, 2026.

At August 01, 2025, the 2026 Notes were classified as a current liability due to their maturity date in 2026.

The following table includes the outstanding principal amount and carrying value of the 2026 Notes as of the period indicated:

August 01, 2025

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Net carrying amount

The effective rate of the 2026 Notes over their expected life is 1.23 %.

The effective rate of the 2026 Notes over their expected life was 1.23 %.

The following is a summary of interest expense for the 2026 Notes for each of the three years:

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Total interest expense

On June 13, 2025, the Company completed a private offering of $ 345,000 aggregate principal amount of the 2030 Notes, which included the exercise in full of the initial purchasers’ option to purchase up to an additional $ 45,000 principal amount of the 2030 Notes.

On June 13, 2025, the Company completed a private offering of $ 345,000 aggregate principal amount of the 2030 Notes.

The 2030 Notes are governed by the terms of an indenture between the Company and U.S.

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The conversion rate is subject to customary adjustments upon the occurrence of certain events.

On August 01, 2025, the conversion rate was 13.8455 shares of the Company’s common stock per $ 1,000 principal amount of the 2030 Notes.

At both July 31, 2026 and August 01, 2025, the conversion rate was 13.8455 shares of the Company’s common stock per $ 1,000 principal amount of the 2030 Notes.

2 unchanged sentences

When a conversion notice is received, the Company will settle any conversions by paying or delivering, as applicable, cash or, if applicable and at the Company’s election, a combination of cash (which shall not be less than $1,000 for each $1,000 principal amount of 2030 Notes being settled) and shares of the Company’s common stock, based on the applicable conversion rate(s) at the time of each such conversion.

The following table includes the outstanding principal amount and carrying value of the 2030 Notes as of the period indicated:

The holders of the 2030 Notes were not eligible to convert their 2030 Notes during 2026 or 2025.

Accordingly, as of July 31, 2026 and August 01, 2025, the Company could not be required to settle the 2030 Notes in cash and, therefore, the 2030 Notes are classified as long-term debt on the Consolidated Balance Sheets.

The following table includes the outstanding principal amount and carrying value of the 2030 Notes as of the periods indicated:

July 31, 2026

August 01, 2025

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The effective rate of the 2030 Notes over their expected life is 2.33 %.

The following is a summary of interest expense for the 2030 Notes for 2025:

The following is a summary of interest expense for the 2030 Notes for 2026 and 2025:

Coupon interest

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Concurrently with the Company’s entry into the Convertible Note Hedge Transactions, the Company also entered into separate, warrant transactions with the Hedge Counterparties collectively relating to the same number of shares of the Company’s common stock, which initially is approximately 1,600,000 shares, subject to customary anti-dilution adjustments, and for which the Company received proceeds that partially offset the cost of entering into the Convertible Note Hedge Transactions (the “Warrant Transactions”).

The Convertible Note Hedge Transactions cover, subject to customary anti-dilution adjustments, the number of shares of the Company’s common stock that initially underlie the 2026 Notes and are expected generally to reduce the potential equity dilution, and/or offset any cash payments in excess of the principal amount due, as the case may be, upon conversion of the 2026 Notes.

The Convertible Note Hedge Transactions covered, subject to customary anti-dilution adjustments, the number of shares of the Company’s common stock that initially underlying the 2026 Notes.

The Convertible Note Hedge Transactions were intended generally to reduce the potential equity dilution, and/or offset any cash payments in excess of the principal amount that could have become payable upon conversion of the 2026 Notes.

By default, the Warrant Transactions are net share settled and the Company has the option to settle in cash or shares.

1 unchanged sentence

The strike price was initially $ 263.39 per share and is subject to certain adjustments under the terms of the Warrant Transactions.

On August 01, 2025, the strike price, as adjusted, of the Warrant Transactions was adjusted to $ 218.88 per share as a result of dividends declared since the 2026 Notes were issued.

On July 31, 2026, the strike price, as adjusted, of the Warrant Transactions was adjusted to $ 213.13 per share as a result of dividends declared since the 2026 Notes were issued.

As of July 31, 2026, August 01, 2025 and August 02, 2024, the market price of the Company’s common stock did not exceed the strike price of the Warrant Transactions.

As a result, the Warrant Transactions were not economically feasible, and no cash settlement, share settlement, or dilution occurred as of July 31, 2026, August 01, 2025 or August 02, 2024.

As these transactions meet certain accounting criteria, the Convertible Note Hedge Transactions and Warrant Transactions were recorded in shareholders’ equity within additional paid-in capital, not accounted for as derivatives and are not remeasured each reporting period.

1 unchanged sentence

These transactions were recorded in shareholders’ equity within additional paid-in capital.

The Convertible Note Hedge Transactions expired on June 15, 2026.

The Warrant Transactions expire in the second quarter of 2027.

Capped Call Transactions

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Share Repurchases

Subject to the limits imposed by the Company’s revolving credit facility, in the fourth quarter of 2022, the Company was authorized by its Board of Directors to repurchase shares of the Company’s outstanding common stock at management’s discretion up to a total value of $ 200,000 .

On June 2, 2023, the Company’s Board of Directors renewed this authorization for an additional year which expired on June 2, 2024.

In the first quarter of 2026, the Board of Directors authorized the Company to repurchase shares of the Company’s outstanding stock at management’s discretion up to a total value of $ 100,000 with an expiration date of September 30, 2027.

In 2026, 2025 and 2024, the Company did no t repurchase any shares of its common stock.

In 2023, the Company repurchased 171,792 shares of its common stock in the open market at an aggregate cost of $ 17,449 .

In the first quarter of 2026, the Board of Directors authorized the Company to repurchase shares of the Company’s outstanding stock at management’s discretion up to a total value of $ 100,000 .

Segment Information

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General and administrative expenses

Gain on sale and leaseback transaction, net

Other segment items (b)

Gain on extinguishment of debt

Litigation settlement income

Interest expense, net

Income before income taxes

Provision for income taxes (income tax benefit)

Income tax benefit

Segment profit and consolidated net income

(a) Excludes advertising, store-level supplies, store-level maintenance and store-level utilities expenses which are disclosed separately.

(b) Consists of impairment costs including goodwill impairment and store closing costs.

(b) Consists of impairment costs including goodwill impairment, store closing costs and the loss on sale of business assets.

Revenue Recognition

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Revenue recognized in the Consolidated Statements of Income for 2026, 2025 and 2024, respectively, for the redemption of gift cards which were included in the deferred revenue balance at the beginning of the fiscal year was $ 33,411 , $ 34,935 , and $ 36,958 , respectively.

Deferred revenue related to the Company’s gift cards was $ 82,452 and $ 84,854 , respectively, at August 01, 2025 and August 02, 2024, and is included in the deferred revenue on the Consolidated Balance Sheets.

Deferred revenue related to the Company’s gift cards was $ 80,505 and $ 82,452 , respectively, at July 31, 2026 and August 01, 2025, and is included in the deferred revenue line on the Consolidated Balance Sheets.

Loyalty Program

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Revenue is recognized for these performance obligations upon redemption of pegs or rewards earned by the customer.

As of August 01, 2025 and August 02, 2024, deferred revenue related to the loyalty program was $ 5,419 and $ 1,544 , respectively, and is included in deferred revenue on the Consolidated Balance Sheets.

As of August 01, 2025, the Company had no t entered into any agreements for real estate leases that are not recorded as right-of-use assets or lease liabilities on the Consolidated Balance Sheet.

As of July 31, 2026 and August 01, 2025, deferred revenue related to the loyalty program was $ 10,756 and $ 5,419 , respectively, and is included in deferred revenue line on the Consolidated Balance Sheets.

As of July 31, 2026, the Company had no t entered into any agreements for real estate leases that are not recorded as right-of-use assets or lease liabilities on the Consolidated Balance Sheet.

The following table summarizes the components of lease cost for operating leases for each of the three years:

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Operating cash flow information:

Gain on sale and leaseback transaction, net

Cash paid for amounts included in the measurement of lease liabilities

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*Included in the Impairment line on the Consolidated Statement of Cash Flows

The following table summarizes the weighted-average remaining lease term and the weighted-average discount rate for operating leases as of August 01, 2025, August 02, 2024 and July 28, 2023:

The following table summarizes the weighted-average remaining lease term and the weighted-average discount rate for operating leases as of July 31, 2026, August 01, 2025 and August 02, 2024:

Weighted-average remaining lease term

Weighted-average discount rate

The following table summarizes the maturities of undiscounted cash flows reconciled to the total operating lease liability as of August 01, 2025:

The following table summarizes the maturities of undiscounted cash flows reconciled to the total operating lease liability as of July 31, 2026:

Total future minimum lease payments

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Under the transaction, the land, buildings and building improvements at the locations were sold and leased back for initial terms of 20 years and renewal options up to 50 years .

On July 17, 2026, the Company completed a sale and leaseback transaction involving 26 Cracker Barrel stores for an aggregate purchase price, net of closing costs of $ 77,398 .

Under the transaction, the land, buildings and building improvements at the locations were sold and leased back for initial terms of 20 years and renewal options up to 40 years .

The aggregate initial annual lease payment for the properties is approximately $ 5,664 , subject to a fixed annual rent increase over the initial lease term.

All of the properties qualified for sale and leaseback and operating lease accounting classification, and the Company recorded a net gain of $ 47,421 , which is recorded in the gain on sale and leaseback transaction, net line in the Consolidated Statement of Income in 2026.

The Company also recorded operating lease right-of-use assets of $ 68,016 , including a non-cash asset recognized as part of accounting for the transaction of $ 4,094 and corresponding operating lease liabilities of $ 63,922 .

Share-Based Compensation

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After the effective date of the 2020 Omnibus Plan, no additional awards could be granted under the Company’s 2010 Omnibus Incentive Stock and Incentive Plan (the “Prior Plan”).

The 2020 Omnibus Plan allows the Committee to grant awards for an aggregate of 1,033,441 shares, the number of shares that were available for issuance as of September 24, 2020 (the “Cutoff Date”) pursuant to the Prior Plan, plus the number of shares that became available for issuance pursuant to the terms of the Prior Plan following the Cutoff Date and prior to the effective date.

However, this share reserve is increased by shares awarded under this and the Prior Plan which are forfeited, expired, settled for cash and shares withheld by the Company in payment of a tax withholding obligation after the effective date of the 2020 Omnibus Plan.

Additionally, this share reserve was decreased by shares granted from the 2020 Omnibus Plan after the effective date.

At August 01, 2025, the number of shares authorized for future issuance under the Company’s active plan is 925,994 .

At August 01, 2025, the number of outstanding awards under the 2020 Omnibus Plan and the Prior Plan was 544,988 and 1,259 , respectively.

In 2025, the Company issued stock options to certain executives.

On November 20, 2025, at the 2025 annual meeting of shareholders, the Company’s shareholders approved an amendment to the 2020 Omnibus Plan (as amended, the “Amended 2020 Omnibus Plan”) to increase the number of shares of our common stock that may be issued under the Amended 2020 Omnibus Plan by 1,325,000 shares and extend the term of the Amended 2020 Omnibus Plan to November 20, 2035.

The Amended 2020 Omnibus Plan allows the Committee to grant awards for an aggregate of (i) 1,033,441 shares, the number of shares that were available for issuance as of September 24, 2020 (the “Cutoff Date”) pursuant to the Prior Plan, plus (ii) the number of shares that became available for issuance pursuant to the terms of the Prior Plan following the Cutoff Date, minus (iii) the number of shares that are subject to awards granted pursuant to the Prior Plan after the Cutoff Date, plus (iv) 1,325,000 shares.

However, this share reserve is increased by (i) shares awarded under the Amended 2020 Omnibus Plan that are forfeited, expired, settled for cash and shares, (ii) shares previously awarded under the Prior Plan that are, after the effective date of the Amended 2020 Omnibus Plan, forfeited, expired, settled for cash and (iii) shares withheld by the Company in payment of a tax withholding obligation after the effective date of the Amended 2020 Omnibus Plan.

Additionally, this share reserve was decreased by shares granted from the Amended 2020 Omnibus Plan after the effective date.

At July 31, 2026, the number of shares authorized for future issuance under the Company’s active plan is 2,144,558 .

At July 31, 2026, the number of outstanding awards under the Amended 2020 Omnibus Plan and the Prior Plan was 735,363 and 1,259 , respectively.

In 2026 and 2025, the Company issued stock options to certain executives.

These stock options have a contractual term of ten years and will vest in three equal installments on each anniversary of the grant date, subject to continued employment.

A summary of the Company’s stock option activity as of August 01, 2025, and changes during 2025 is presented in the following table:

A summary of the Company’s stock option activity as of July 31, 2026, and changes during 2026 is presented in the following table:

Weighted-Average

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Outstanding at August 01, 2025

Outstanding at July 31, 2026

The weighted-average grant-date fair value of the stock options granted during 2026 was $ 18.56 .

The weighted-average remaining contractual term of the stock options outstanding as of August 01, 2025, was 9.2 years, and the aggregate intrinsic value of the outstanding stock options was $ 1,558 .

The intrinsic value for stock options is defined as the difference between the current market value and the grant price.

As of August 01, 2025, none of the stock options were exercisable and none were exercised during 2025.

The weighted-average remaining contractual term of the stock options outstanding as of July 31, 2026, was 8.7 years, and the aggregate intrinsic value of the outstanding stock options was $ 2,394 .

The intrinsic value for stock options is the amount by which the current market price of the Company’s common stock exceeds the option’s exercise price.

None of the options were exercised during 2026 or 2025.

The fair value of each option award was estimated on the date of grant using the Black-Scholes-Merton option pricing model, which incorporates the assumptions for inputs shown in the following table.

The assumptions used are as follows:

● The Company has not granted option awards in several years and does not have adequate historical exercise/cancellation behavior on which to base the expected life assumption.

● Prior to 2025, the Company had not granted option awards in several years and, as a result, does not have adequate historical exercise/cancellation behavior on which to base the expected life assumption.

As such, the Company used the simplified method in SEC Staff Accounting Bulletin No.

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The stock awards under the long-term performance plans are calculated or estimated based on achievement of financial performance measures.

The following table summarizes the performance periods and vesting periods for the Company’s nonvested stock awards under its long-term performance plans at August 01, 2025:

The following table summarizes the performance periods and vesting periods for the Company’s nonvested stock awards under its long-term performance plans at July 31, 2026:

Vesting Period

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Performance Period

The following table summarizes the shares that have been accrued under the 2025 LTPP, 2024 LTPP and 2023 LTPP at August 01, 2025:

A summary of the Company’s nonvested stock activity as of August 01, 2025, and changes during 2025 are presented in the following table:

The following table summarizes the shares that have been accrued under the 2026 LTPP, 2025 LTPP and 2024 LTPP at July 31, 2026:

A summary of the Company’s nonvested stock activity as of July 31, 2026, and changes during 2026 are presented in the following table:

Weighted-Average Grant

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Unvested at August 01, 2025

Unvested at July 31, 2026

The following table summarizes the total fair value of nonvested stock that vested for each of the three years:

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Total compensation expense

The following table highlights the total unrecognized compensation expense related to the outstanding nonvested stock awards and nonvested stock units and the weighted-average periods over which the expense is expected to be recognized as of August 01, 2025:

Total unrecognized compensation

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Any Rights held by an Acquiring Person will be void and may not be exercised.

At August 01, 2025, none of the Rights were exercisable.

At July 31, 2026, none of the Rights were exercisable.

Consequences of a Person or Group Becoming an Acquiring Person

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● Flip Over .

If the Company is later acquired in a merger or similar transaction after the Distribution Date, all holders of Rights except the Acquiring Person may, for $ 600.00 , purchase shares of the acquiring corporation with a market value of $ 1,200.00 , based on the market price of the acquiring corporation’s stock prior to such transaction.

If the Company is later acquired in a merger or similar transaction after the Distribution Date, all holders of Rights except the Acquiring Person may, for $ 600.00 , purchase shares of the acquiring

corporation with a market value of $ 1,200.00 , based on the market price of the acquiring corporation’s stock prior to such transaction.

● Notional Shares .

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Non-Qualified Savings Plan

The components of the provision for income taxes (income tax benefit) for each of the three years were as follows:

Total provision for income taxes (income tax benefit)

A reconciliation of the Company’s provision for income taxes (income tax benefit) and income taxes based on the statutory U.S.

Litigation Settlement

In March 2026, the Company received $ 47,422 , net of legal fees, pursuant to a settlement agreement resolving interchange fee litigation.

This amount is recorded in the litigation settlement income line on the Consolidated Statement of Income.

MSBC Divestiture

On July 20, 2026, the Company completed the sale of certain assets used in its MSBC business to a third party, including the MSBC tradename and other intellectual property and the assets used in thirty-five MSBC restaurant locations.

As a result of the sale, the Company recognized a loss on the sale of certain MSBC business assets of $ 27,039 related to the divestiture which is recorded in the loss on sale of business assets line in the Consolidated Statements of Income in 2026.

Simultaneously with the completion of the sale of certain assets used in the MSBC business, the Company closed its remaining sixteen MSBC restaurant locations on July 20, 2026.

In connection with the closure of the remaining MSBC locations and exiting the business, the Company recognized an impairment charge of $ 8,523 associated primarily with long-lived assets as well as a charge of $ 5,430 in closing costs consisting primarily of severance, contract termination costs and other closure-related activities in 2026.

The impairment, store closing costs and other closure-related charges were recorded in the impairment and store closing costs line on the Consolidated Statements of Income.

Management concluded that the disposal does not represent a strategic shift that has, or will have, a major effect on the Company's operations and financial results.

The components of the income tax benefit for each of the three years were as follows:

Total income tax benefit

A reconciliation of the Company’s income tax benefit and income taxes based on the statutory U.S.

federal rate of 21.0 % in 2026, 2025 and 2024 was as follows:

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Other employer tax credits

Tax audit settlement

Carryback of federal tax credits

Nontaxable or Nondeductible Items

Non-deductible executive compensation

Share-based compensation

Total provision for income taxes (income tax benefit)

Changes in Unrecognized Tax Benefits

Other Adjustments

Carryback of federal tax credits

Total income tax benefit

In 2026, 2025 and 2024, state and local income taxes in Texas, Illinois, Tennessee and Kentucky comprise the majority of the state and local income taxes, net of federal benefit line item above.

The Company’s income tax benefit increased in 2026 primarily due to the decrease in income before income taxes as compared to 2025.

The Company’s income tax benefit decreased in 2025 primarily due to the increase in income before income taxes and fewer favorable audit settlements as compared to 2024.

The decrease in the Company’s provision for income taxes (income tax benefit) in 2024 as compared to 2023 is primarily due to the decrease in income before income taxes and favorable audit settlements in 2024.

H.R.1., also known as the One Big Beautiful Bill Act (OBBBA), was enacted on July 4, 2025.

The OBBBA includes significant tax law changes with effective dates in 2025 and continuing through 2027.

The provisions effective during 2025 did not have a material impact on the Company’s 2025 financial statements.

Significant components of the Company’s net deferred tax liability consisted of the following at:

August 01, 2025

July 31, 2026

August 01, 2025

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Net deferred tax liability

The Company has a deferred tax asset of $ 28,556 reflecting federal income tax credit carryforwards that expire in 2044.

The Company has a deferred tax asset of $ 46,963 reflecting federal income tax credit carryforwards that expire beginning in 2045.

The Company has state income tax net operating loss carryforwards (“NOL”) of $ 102,745 and has recorded a deferred tax asset of $ 5,806 reflecting this benefit.

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these amounts are included in other long-term liabilities in the Consolidated Balance Sheets.

As of August 01, 2025 and August 02, 2024, the Company’s gross liability for uncertain tax positions, exclusive of interest and penalties, was $ 6,703 and $ 7,404 , respectively.

As of July 31, 2026 and August 01, 2025, the Company’s gross liability for uncertain tax positions, exclusive of interest and penalties, was $ 6,321 and $ 6,703 , respectively.

Summarized below is a tabular reconciliation of the beginning and ending balance of the Company’s total gross liability for uncertain tax positions exclusive of interest and penalties:

July 31, 2026

August 01, 2025

August 02, 2024

July 28, 2023

Balance at beginning of year

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Uncertain tax positions

The Company had $ 8,672 , $ 7,913 , and $ 7,896 in interest and penalties accrued as of August 01, 2025, August 02, 2024, and July 28, 2023, respectively.

The Company recognized accrued interest and penalties related to unrecognized tax benefits of $ 760 , $ 17 and $ 764 in its provision for income taxes (income tax benefit) on August 01, 2025, August 02, 2024 and July 28, 2023, respectively.

In many cases, the Company’s uncertain tax positions are related to tax years that remain subject to examination by the relevant taxing authorities.

Based on the outcome of these examinations or as a result of the expiration of the statutes of limitations for specific taxing jurisdictions, it is reasonably possible that the related uncertain tax positions taken regarding previously filed tax returns could decrease from those recorded as liabilities for uncertain tax positions in the Company’s financial statements at August 01, 2025 by approximately $ 300 to $ 1,200 within the next twelve months.

At August 01, 2025, the Company was subject to income tax examinations for its U.S.

The Company had $ 9,980 , $ 8,672 , and $ 7,913 in interest and penalties accrued as of July 31, 2026, August 01, 2025, and August 02, 2024, respectively.

The Company recognized accrued interest and penalties related to unrecognized tax benefits of $ 1,307 , $ 760 and $ 17 in its income tax benefit for the years ended on July 31, 2026, August 01, 2025 and August 02, 2024, respectively.

At July 31, 2026, the Company was subject to income tax examinations for its U.S.

federal income taxes after 2020 and for state and local income taxes generally after 2020.

H.R.1., also known as the One Big Beautiful Bill Act (OBBBA), was enacted on July 4, 2025.

The OBBBA includes significant tax law changes with effective dates in 2025 and continuing through 2027.

As a result of accelerating deductions for qualified depreciable property, research and development expenses and interest expense, our cash tax payments for 2026 were significantly reduced.

Income taxes paid (net of refunds) for each of the three years were as follows:

state and local

North Carolina

*The amount of the income taxes paid during the year does not meet the 5% disaggregation threshold.

Net Income Per Share and Weighted Average Shares

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The Company and its subsidiaries are party to various legal and regulatory proceedings and claims incidental to their business in the ordinary course.

In the opinion of management, based upon information currently available, the ultimate liability with respect to these proceedings and claims will not materially affect the Company’s consolidated results of operations or financial position.

In the opinion of management, based upon information currently available, the ultimate liability in excess of amounts accrued with respect to these proceedings and claims will not materially affect the Company’s consolidated results of operations or financial position.

During 2026, the Company received proceeds from legal settlements related to litigation involving its poultry and pork suppliers for a total of $ 12,596 .

These proceeds are recorded in other store operating expenses in the Consolidated Statements of Income.

During 2026, the Company also received $ 47,422 , net of legal fees, pursuant to a settlement agreement resolving interchange fee litigation.

This amount is recorded in the litigation settlement income line on the Consolidated Statement of Income.

The Company maintains insurance coverage for various aspects of its business and operations.

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Related to its insurance coverage, the Company is contingently liable pursuant to standby letters of credit as credit guarantees to certain insurers.

As of August 01, 2025, the Company had $ 34,004 of standby letters of credit related to securing reserved claims under workers’ compensation insurance and certain sale and leaseback transactions.

As of July 31, 2026, the Company had $ 8,703 of standby letters of credit related to securing reserved claims under workers’ compensation insurance and certain sale and leaseback transactions.

All standby letters of credit are renewable annually and reduce the Company’s borrowing availability under its 2025 Revolving Credit facility.

See Note 4 for additional information regarding the 2025 Revolving Credit Facility.

The Company has entered into lease guarantees in connection with the assignment to third-party leases of certain leases following closure of the related store locations.

The Company is only obligated to perform the new lessees’ lease obligations in the event of non-performance by such lessees for a specified period.

The guarantees have varying terms with the latest expiring in March 2035.

As of July 31, 2026, the likelihood of payment by the Company under the guarantees is considered remote.

No liability has been recorded in the Consolidated Balance Sheet as of July 31, 2026.

The maximum aggregate potential future payments under the guarantees are estimated to be approximately $ 11,223 .

The Company enters into certain indemnification agreements in favor of third parties in the ordinary course of business.

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 8. Financial Statements and Supplementary Data