1352801--9/7/2007--Burger_King_Holdings

related topics

{operation, international, foreign}

{financial, litigation, operation}

{cost, operation, labor}

{cost, regulation, environmental}

{stock, price, share}

{debt, indebtedness, cash}

{condition, economic, financial}

{acquisition, growth, future}

{stock, price, operating}

{competitive, industry, competition}

{customer, product, revenue}

{cost, contract, operation}

{provision, law, control}

{operation, natural, condition}

{capital, credit, financial}

{loan, real, estate}

{system, service, information}

{property, intellectual, protect}

{personnel, key, retain}

{product, liability, claim}

{regulation, government, change}

{regulation, change, law}

If we fail to successfully implement our international growth strategy, our ability to increase our revenues and operating profits could be adversely affected and our overall business could be adversely affected. Our international operations subject us to additional risks and costs and may cause our profitability to decline. Approximately 90% of our restaurants are franchised and this restaurant ownership mix presents a number of disadvantages and risks. Increases in the cost of food, paper products and energy could harm our profitability and operating results. We rely on distributors of food, beverages and other products that are necessary for our and our franchisees operations. If these distributors fail to provide the necessary products in a timely fashion, our business would face supply shortages and our results of operations might be adversely affected. Our business is affected by changes in consumer preferences and consumer discretionary spending. Our operating results depend on the effectiveness of our marketing and advertising programs and franchisee support of these programs. Our operating results are closely tied to the success of our franchisees. Over the last several years, many franchisees in the United States, Canada and the U.K. have experienced severe financial distress, and our franchisees may experience financial distress in the future. Our U.K. business has and may continue to experience declining sales and operating profits that may adversely affect the financial health of our franchisees and us. There can be no assurance that the franchisees can or will renew their franchise agreements with us. Incidents of food-borne illnesses or food tampering could materially damage our reputation and reduce our restaurant sales. Labor shortages or increases in labor costs could slow our growth or harm our business. The loss of key management personnel or our inability to attract and retain new qualified personnel could hurt our business and inhibit our ability to operate and grow successfully. The realignment of our European and Asian businesses may result in increased income tax expense to us if these businesses are less profitable than expected. Additional tax liabilities could adversely impact our financial results. Our business is subject to fluctuations in foreign currency exchange and interest rates. Leasing and ownership of a significant portfolio of real estate exposes us and our franchisees to potential losses and liabilities and we or our franchisees may not be able to renew leases, control rent increases and control real estate expenses at existing restaurant locations or obtain leases or purchase real estate for new restaurants. Current restaurant locations may become unattractive, and attractive new locations may not be available for a reasonable price, if at all. We may not be able to adequately protect our intellectual property, which could harm the value of our brand and branded products and adversely affect our business. We may experience significant fluctuations in our operating results due to a variety of factors, many of which are outside of our control. Our indebtedness under our senior secured credit facility is substantial and could limit our ability to grow our business. Our senior secured credit facility has restrictive terms and our failure to comply with any of these terms could put us in default, which would have an adverse effect on our business and prospects. We face risks of litigation and pressure tactics, such as strikes, boycotts and negative publicity from restaurant customers, franchisees, suppliers, employees and others, which could divert our financial and management resources and which may negatively impact our financial condition and results of operations. Our products are subject to numerous and changing government regulations, and failure to comply with such existing or future government regulations could negatively affect our sales, revenues and earnings. Increasing regulatory complexity surrounding our operations will continue to affect our operations and results of operations in material ways. The personal information that we collect may be vulnerable to breach, theft or loss that could adversely affect our reputation and operations. Compliance with or cleanup activities required by environmental laws may hurt our business. Regulation of genetically modified food products may force us to find alternative sources of supply. Our results can be adversely affected by disruptions or catastrophic events. Our current principal stockholders own the majority of our common stock which allows them significant influence over us, and they could delay, deter or prevent a change in control or other business combination or otherwise cause us to take action with which you disagree. We are a controlled company within the meaning of the New York Stock Exchange rules, and, as a result, qualify for, and intend to rely on, exemptions from certain corporate governance requirements that provide protection to stockholders of other companies. Your percentage ownership in us may be diluted by future issuances of capital stock, which could reduce your influence over matters on which stockholders vote. The sale of a substantial number of shares of our common stock may cause the market price of shares of our common stock to decline.

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1352801--9/7/2007--Burger_King_Holdings_Inc