Dairy Mart Urges Shareholders to Support Management's Continuing Efforts to Maximize Value.

Business Editors

NOTE TO MEDIA: Photo (of 3 charts) is available in a Smart News

Release(TM) on Business Wire's Home Page at www.businesswire.com

HUDSON, Ohio--(BUSINESS WIRE)--May 19, 2000

Dairy Mart Convenience Stores, Inc. (AMEX:DMC) today urged shareholders to vote in favor of the Company's current board and management in its continuing efforts to maximize shareholder value.

"Our efforts are accelerating as we begin reviewing expressions of interest received from prospective buyers of the Company," said Robert B. Stein, Dairy Mart Chairman, President and Chief Executive Officer. "Since our board approved a plan on April 6 to sell 246 stores to improve profitability and reduce debt, we have received notice of credible interest in the entire chain from a number of parties."

Stein noted that the plan to sell 246 stores is being put on hold while the Company reviews the expressions of interest.

As previously announced, the Company has retained Morgan Keegan & Company, Inc., investment bankers, to review the expressions of interest and explore all of the company's options for increasing shareholder value, including a sale.

"Morgan Keegan is actively engaged and pursuing all options on an aggressive timetable," said Stein. "Further, they are highly incentivized to arrange a sale and maximize shareholder value."

Also today, the Company sent another letter to major shareholders in its ongoing proxy fight with Frank Colaccino, a former chief executive officer of Dairy Mart who was fired in 1994. (NOTE TO EDITORS: full text of the letter follows this press release.)

Dairy Mart Convenience Stores, Inc., was named "Convenience Store Chain of the Year" in 1999 by Convenience Store Decisions magazine. The company owns and operates approximately 600 retail stores in seven states in the Midwest and Southeast. Through consulting and licensing agreements, the Company is also affiliated with more than 200 stores in Korea and approximately 400 locations in Malaysia. For more information, visit Dairy Mart's web site at www.dairymart.com.

Morgan Keegan & Company, Inc., based in Memphis, Tennessee, provides securities brokerage, investment banking and other financial services through its 45 offices in 13 states. The firm is a subsidiary of Morgan Keegan, Inc., a financial services holding company listed on the New York Stock Exchange (symbol:MOR). Morgan Keegan has a dedicated Convenience Store and Retail Petroleum Group and has recently been involved in many transactions involving convenience store companies. In addition, Morgan Keegan equity research recently began covering the convenience store industry and expects to publish a comprehensive research report this summer.

Statements contained in this release that are not historical facts, including those relating to possible outcomes of exploring the Company's strategic alternatives, such as a possible sale of the Company and those relating to the effects of continuing a proxy fight may constitute forward-looking statements. Factors that could cause actual results to differ materially from those stated or implied in the forward-looking statements include competition, general economic conditions, the ability to find one or more suitable buyers for the stores or the whole Company at acceptable prices, the ability of such buyers to finance store purchases or the whole Company, the determination of the board of directors, which may or may not include a sale of the stores or the whole Company and other factors disclosed in Dairy Mart's periodic filings with the Securities and Exchange Commission. The Company assumes no obligation to update the information contained in this release.

Full text of the letter follows:

LET'S SET THE RECORD STRAIGHT:

YOUR BOARD AND MANAGEMENT HAVE BEEN

CREATING VALUE FOR THE BENEFIT OF ALL SHAREHOLDERS

Your vote is important.

Please sign, date and return the enclosed WHITE proxy card today.

Dear Fellow Shareholders:

As the annual meeting approaches, I want to take a final opportunity to remind you of all that your current board and management have been and are doing to maximize the value of your investment in Dairy Mart -- value that we expect to realize in the event of a sale.

WE BELIEVE YOUR INVESTMENT HAS MEANINGFUL VALUE

THAT IS NOT YET REFLECTED

IN THE COMPANY'S FINANCIAL STATEMENTS.

Consider the following:

-- In cleaning up after the Frank Colaccino era, we

significantly downsized the Company, got rid of

underperforming stores and exited the non-core dairy

manufacturing and distribution business. We now have a

geographic strength that is strategically important to

others.

-- We have focused our efforts on building a portfolio of

quality assets, including opening 80 new stores over the

past five years that are continuing to mature and hold

significant future value. They are among the most attractive

assets to potential buyers.

-- More recently, two weeks before Colaccino started his proxy

fight, your board approved a sweeping plan to sell or close

246 underperforming stores, improve profitability and reduce

debt. News of that plan helped to generate credible

expressions of interest from potential buyers of Dairy Mart,

so we are putting the store-closing plan on hold.

-- We retained Morgan Keegan & Company to explore all of the

Company's strategic options, including selling the Company.

Morgan Keegan is highly incentivized to arrange a sale and

maximize value. The firm is actively pursuing all avenues

and is on an aggressive schedule for reaching a satisfactory

conclusion.

COLACCINO IS DEPICTING DAIRY MART TO SHAREHOLDERS

AND THE OUTSIDE WORLD AS A DISTRESSED COMPANY.

THAT'S SIMPLY NOT TRUE -- AND IT'S A DISSERVICE TO YOU.

Not surprisingly, Colaccino has claimed credit for a $7 stock price and record sales and EBITDA. In reality, the Company never had record earnings while he was CEO. Colaccino produced illusionary growth fueled by the rapid acquisition of a ragtag group of assets. Once the acquisitions stopped, the reality of Colaccino's "growth" became clear - he left Dairy Mart saddled with $90 million in debt and hundreds of low-volume, underperforming stores.

Sales and EBITDA growth are easily achieved in an acquisition-driven environment. Although Colaccino increased the number of stores, he was unable to make meaningful improvement in per-store profitability.

Under the leadership of the current board and management, Dairy Mart has made significant operational gains.

(See three accompanying charts.)

-- Revenue per store has increased 68% since 1995. Last year

alone, we increased comparable store sales by 11%,

continuing three consecutive years as one of the industry

leaders in same-store sales growth.

-- Average gross profit per store has also improved steadily

since 1995, growing 52% over that period of time.

-- EBITDA (earnings before interest, taxes, depreciation and

amortization) per store has increased 166% since fiscal

1996.

-- Average gasoline sales per store have increased nearly 40%

since 1996 -- to 753,000 gallons.

WE BELIEVE COLACCINO'S INACCURATE PORTRAYAL OF THIS COMPANY

IS HARMING THE VALUE OF YOUR INVESTMENT.

If Colaccino succeeds, the impact on your investment could be devastating.

Whether he claims to want to be CEO or not, consider whether you want to entrust the future of your Company - and the future of your investment - to a man who appears more interested in tacking up a "going-out-of-business" sign than in getting top dollar for your investment. His efforts could:

-- Trigger change-of-control provisions in the Company's credit

agreements and accelerate repayment of $115 million in debt.

-- Disrupt the Company's vital relationships with suppliers and

vendors.

-- Devastate employee morale and retention at a critical time

for the Company.

-- Derail the efforts of the current board and management to

maximize shareholder value.

-- Lead to a "fire sale" of the Company that would certainly

fail to achieve maximum value for your investment in Dairy

Mart.

As we enter this critical phase in the history of Dairy Mart, I ask once again for your support.

-- If you have already voted a WHITE proxy card for the

Company's director slate, thank you. No further action is

required.

-- If you have voted a BLUE proxy card for the Colaccino slate,

it is not too late to change your vote. Please sign, date

and return your WHITE proxy card today. Only the latest

dated proxy card will be counted at the annual meeting.

Thank you.

On Behalf of your Board of Directors

Robert B. Stein, Jr.

Chairman, President and CEO

May 19, 2000

If you have any questions or need assistance in voting your shares or changing your vote, please contact:

MacKenzie Partners, Inc.

156 Fifth Avenue

New York, New York 10010

[phone] (Call Collect)

or

CALL TOLL-FREE: [phone]

Note: A Photo (of 3 charts) is available at URL: http://www.businesswire.com/cgi-bin/photo.cgi?pw.051900/bb3