1171759--2/26/2009--RED_ROBIN_GOURMET_BURGERS

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{cost, contract, operation}

{competitive, industry, competition}

{condition, economic, financial}

{financial, litigation, operation}

{cost, regulation, environmental}

{cost, operation, labor}

{acquisition, growth, future}

{capital, credit, financial}

{product, market, service}

{property, intellectual, protect}

{operation, natural, condition}

{debt, indebtedness, cash}

Risks Related to Our Business Our operating results may fluctuate significantly due to various risks and unexpected circumstances, increases in costs, seasonality and other factors outside our control. The decline in the economy and the financial markets may adversely impact our revenues and our results of operations, resulting in a deceleration in the number of restaurant openings, and adversely affect our ability to utilize or comply with the terms of our credit facility. Expanding our restaurant base is critical to our long-term success and our ability to open and profitably operate new restaurants is subject to factors beyond our control. The change in our national advertising campaign strategy, and elimination of our cable television advertising in 2009, may negatively impact our results. New or less mature restaurants, once opened, may vary in profitability and levels of operating revenue for three years or more. Our initiative to address normalizing new restaurant operations may not continue to have a positive impact on our new restaurant operations. Our expansion into new markets may present increased risks due to lack of guest familiarity with our brand in new areas and our lack of familiarity with the new market. Expansion into new geographic markets negatively impacts our ability to leverage costs, inventory, resources and operating efficiencies for new restaurants because of the limited number of new restaurants initially. Our continuing focus on restaurant expansion through further penetrating existing markets could cause sales in some of our existing restaurants to decline. Our ability to utilize our revolving credit agreement and our ability to raise capital in the future may be limited, which could adversely impact our business. If our franchisees cannot develop or finance new restaurants, build them on suitable sites or open them on schedule, our growth and success may be impeded. The acquisition of existing restaurants from our franchisees may have unanticipated consequences that could harm our business and financial condition. Our existing systems and procedures may be inadequate to support our growth plans. Our operations are susceptible to the changes in cost and availability of food which could adversely affect our operating results. Price increases may impact guest visits. Approximately 50% of our company-owned restaurants are located in the Western United States and, as a result, we are sensitive to economic and other trends and developments in this region. Labor shortages could slow our growth or harm our business. Changes in consumer preferences could continue to negatively impact our results of operations. Our franchisees could take actions that could harm our business. Our future success depends on our ability to protect our intellectual property. Risks Related to the Restaurant Industry Health concerns relating to the consumption of beef, chicken or other food products could affect consumer preferences and could negatively impact our results of operations. We are subject to extensive government regulation that may adversely hinder or impact our ability to govern various aspects of our business including our ability to expand and develop our restaurants. A significant increase in litigation could have a material adverse effect on our results of operations, financial condition and business prospects. Our success depends on our ability to compete effectively in the restaurant industry.

Full 10-K form ▸

1171759--2/26/2009--RED_ROBIN_GOURMET_BURGERS_INC