SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

(Address of principal executive offices) (Zip Code)

(Registrant's telephone number, including area code)

(Former name, former address and former fiscal year, if changed since last report)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act.

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

Securities registered pursuant to Section 12(b) of the Exchange Act:

Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date.

As of November ~~4, 2020,~~8, 2021, there were ~~15,541,851~~15,716,181 shares of the registrant's common stock, par value of $0.001 per share outstanding.

RED ROBIN GOURMET BURGERS, INC.

PART I — FINANCIAL INFORMATION

ITEM 1. Financial Statements (unaudited)

RED ROBIN GOURMET BURGERS, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)
(in thousands, except for share amounts) October 4, 2020 December 29, 2019
Assets:
Current assets:
Cash and cash equivalents $ 27,367 $ 30,045
Accounts receivable, net 9,024 22,372
Inventories 24,496 26,424
Income tax receivable 63,066 5,308
Prepaid expenses and other current assets 11,652 21,338
Total current assets 135,605 105,487
Property and equipment, net 446,083 518,013
Right of use assets, net 415,948 426,248
Goodwill 0 96,397
Intangible assets, net 25,440 29,975
Other assets, net 10,195 61,460
Total assets $ 1,033,271 $ 1,237,580
Liabilities and stockholders' equity:
Current liabilities:
Accounts payable $ 18,940 $ 33,040
Accrued payroll and payroll-related liabilities 26,878 35,221
Unearned revenue 42,564 54,223
Current portion of lease obligations 62,032 42,699
Current portion of long-term debt 9,692 0
Accrued liabilities and other 42,987 29,403
Total current liabilities 203,093 194,586
Long-term debt 206,375 206,875
Long-term portion of lease obligations 450,751 465,435
Other non-current liabilities 19,858 10,164
Total liabilities 880,077 877,060
Stockholders' equity:
Common stock; $0.001 par value: 45,000 shares authorized; 20,449 and 17,851 shares issued; 15,548 and 12,923 shares outstanding as of October 4, 2020 and December 29, 2019 20 18
Preferred stock, $0.001 par value: 3,000 shares authorized; 0 shares issued and outstanding as of October 4, 2020 and December 29, 2019 0 0
Treasury stock 4,901 and 4,928 shares, at cost, as of October 4, 2020 and December 29, 2019 (199,908) (202,313)
Paid-in capital 242,048 213,922
Accumulated other comprehensive loss, net of tax (5,494) (4,373)
Retained earnings 116,528 353,266
Total stockholders' equity 153,194 360,520
Total liabilities and stockholders' equity
$ 1,033,271 $ 1,237,580
(Unaudited)


(in thousands, except for per share amounts)	October 3, 2021		December 27, 2020
Assets:
Current assets:
Cash and cash equivalents	$	17,757	$	16,116
Accounts receivable, net	11,939		16,510
Inventories	23,769		23,802
Income tax receivable	16,165		16,662
Prepaid expenses and other current assets	12,439		13,818
Total current assets	82,069		86,908
Property and equipment, net	388,881		427,033
Right of use assets, net	419,788		425,573

Intangible assets, net	22,419		24,714
Other assets, net	8,567		10,511
Total assets	$	921,724	$	974,739
Liabilities and stockholders' equity:
Current liabilities:
Accounts payable	$	34,638	$	20,179
Accrued payroll and payroll-related liabilities	32,555		27,653
Unearned revenue	42,621		50,138
Current portion of lease obligations	49,894		55,275
Current portion of long-term debt	9,692		9,692
Accrued liabilities and other	42,240		39,617
Total current liabilities	211,640		202,554
Long-term debt	147,471		160,952
Long-term portion of lease obligations	450,673		465,233
Other non-current liabilities	15,775		25,287
Total liabilities	$	825,559	$	854,026
Commitments and contingencies (see note 8)
Stockholders' equity:
Common stock; $0.001 par value: 45,000 shares authorized; 20,449 shares issued; 15,722 and 15,548 shares outstanding as of October 3, 2021 and December 27, 2020	$	20	$	20
Preferred stock, $0.001 par value: 3,000 shares authorized; no shares issued and outstanding as of October 3, 2021 and December 27, 2020	—		—
Treasury stock 4,727 and 4,901 shares, at cost, as of October 3, 2021 and December 27, 2020	(192,819)		(199,908)
Paid-in capital	240,445		243,407
Accumulated other comprehensive income (loss), net of tax	10		(4)
Retained earnings	48,509		77,198
Total stockholders' equity	96,165		120,713
Total liabilities and stockholders' equity	$	921,724	$	974,739

See Notes to Condensed Consolidated Financial Statements.

RED ROBIN GOURMET BURGERS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

Twelve Weeks Ended Forty Weeks Ended
(in thousands, except for share amounts) October 4, 2020 October 6, 2019 October 4, 2020 October 6, 2019
Revenues:
Restaurant revenue $ 197,009 $ 289,862 $ 658,587 $ 992,764
Franchise and other revenues 3,469 4,360 9,078 19,305
Total revenues 200,478 294,222 667,665 1,012,069
Costs and expenses:
Restaurant operating costs (excluding depreciation and amortization shown separately below):
Cost of sales 46,037 69,017 155,243 235,119
Labor 74,344 104,870 255,652 354,302
Other operating 37,631 44,317 124,585 142,882
Occupancy 22,099 24,942 76,514 85,420
Depreciation and amortization 19,173 21,280 68,053 71,087
Selling, general, and administrative expenses 21,284 36,776 82,483 120,126
Pre-opening costs 89 0 245 319
Other charges 4,416 (1,757) 138,296 17,488
Total costs and expenses 225,073 299,445 901,071 1,026,743
Loss from operations (24,595) (5,223) (233,406) (14,674)
Other expense:
Interest expense, net and other 2,280 1,812 7,629 7,203
Loss before income taxes (26,875) (7,035) (241,035) (21,877)
Income tax benefit (20,696) (5,214) (4,297) (21,676)
Net loss $ (6,179) $ (1,821) $ (236,738) $ (201)
Loss per share:
Basic $ (0.40) $ (0.14) $ (16.98) $ (0.02)
Diluted $ (0.40) $ (0.14) $ (16.98) $ (0.02)
Weighted average shares outstanding:
Basic 15,540 12,959 13,945 12,967
Diluted 15,540 12,959 13,945 12,967
Other comprehensive income (loss):
Foreign currency translation adjustment $ 9 $ (262) $ (1,121) $ (185)
Other comprehensive income (loss), net of tax 9 (262) (1,121) (185)
Total comprehensive loss $ (6,170) $ (2,083) $ (237,859) $ (386)


	Twelve Weeks Ended				Forty Weeks Ended
(in thousands, except for per share amounts)	October 3, 2021		October 4, 2020		October 3, 2021		October 4, 2020
Revenues:
Restaurant revenue	$	270,202	$	197,009	$	861,036	$	658,587
Franchise and other revenues	5,242		3,469		17,658		9,078

Total revenues	275,444		200,478		878,694		667,665
Costs and expenses:
Restaurant operating costs (excluding depreciation and amortization shown separately below):
Cost of sales	62,671		46,037		193,754		155,243
Labor	99,725		74,344		310,333		255,652
Other operating	51,462		37,631		156,102		124,585
Occupancy	22,519		22,099		74,233		76,514
Depreciation and amortization	18,881		19,173		63,984		68,053
General and administrative expenses	17,691		15,190		57,664		56,054
Selling expenses	12,652		6,094		31,635		26,429
Pre-opening costs	418		89		792		245
Other charges	1,561		4,416		9,228		138,296
Total costs and expenses	287,580		225,073		897,725		901,071

Loss from operations	(12,136)		(24,595)		(19,031)		(233,406)
Other expense:
Interest expense, net and other	2,870		2,280		9,986		7,629



Loss before income taxes	(15,006)		(26,875)		(29,017)		(241,035)
Income tax benefit	(26)		(20,696)		(328)		(4,297)
Net loss	$	(14,980)	$	(6,179)	$	(28,689)	$	(236,738)
Loss per share:
Basic	$	(0.95)	$	(0.40)	$	(1.83)	$	(16.98)
Diluted	$	(0.95)	$	(0.40)	$	(1.83)	$	(16.98)
Weighted average shares outstanding:
Basic	15,709		15,540		15,647		13,945
Diluted	15,709		15,540		15,647		13,945

Other comprehensive (loss) income:
Foreign currency translation adjustment	$	(6)	$	9	$	14	$	(1,121)
Other comprehensive (loss) income, net of tax	(6)		9		14		(1,121)
Total comprehensive loss	$	(14,986)	$	(6,170)	$	(28,675)	$	(237,859)

See Notes to Condensed Consolidated Financial Statements.

RED ROBIN GOURMET BURGERS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

(Unaudited)


	Common Stock			Treasury Stock					Accumulated Other Comprehensive (Loss) Income, net of tax
							Paid-in Capital				Retained Earnings
(in thousands)	Shares	Amount		Shares	Amount								Total
Balance, December 27, 2020	20,449	$	20	4,901	$	(199,908)	$	243,407	$	(4)	$	77,198	$	120,713
Exercise of options, issuance of restricted stock, shares exchanged for exercise and tax, and stock issued through employee stock purchase plan	—	—		(74)	3,025		(3,640)		—		—		(615)


Non-cash stock compensation	—	—		—	—		880		—		—		880
Net loss	—	—		—	—		—		—		(8,713)		(8,713)
Other comprehensive income	—	—		—	—		—		21		—		21

Balance, April 18, 2021	20,449	$	20	4,827	$	(196,883)	$	240,647	$	17	$	68,485	$	112,286

Exercise of options, issuance of restricted stock, shares exchanged for exercise and tax, and stock issued through employee stock purchase plan	—	—		(95)	3,844		(3,547)		—		—		297


Non-cash stock compensation	—	—		—	—		1,577		—		—		1,577
Net loss	—	—		—	—		—		—		(4,996)		(4,996)
Other comprehensive (loss)	—	—		—	—		—		(1)		—		(1)
Balance, July 11, 2021	20,449	$	20	4,732	$	(193,039)	$	238,677	$	16	$	63,489	$	109,163

Exercise of options, issuance of restricted stock, shares exchanged for exercise and tax, and stock issued through employee stock purchase plan	—	—		(5)	220		(280)		—		—		(60)


Non-cash stock compensation	—	—		—	—		2,048		—		—		2,048
Net loss	—	—		—	—		—		—		(14,980)		(14,980)
Other comprehensive loss	—	—		—	—		—		(6)		—		(6)
Balance, October 3, 2021	20,449	$	20	4,727	$	(192,819)	$	240,445	$	10	$	48,509	$	96,165

Common Stock Treasury Stock Accumulated
Other
Comprehensive
Loss,
net of tax
Paid-in
Capital Retained
Earnings
(in thousands) Shares Amount Shares Amount Total
Balance, December 29, 2019 17,851 $ 18 4,928 $ (202,313) $ 213,922 $ (4,373) $ 353,266 $ 360,520
Exercise of options, issuance of restricted stock, shares exchanged for exercise and tax, and stock issued through employee stock purchase plan — — (39) 1,605 (1,388) — — 217
Acquisition of treasury stock — — 72 (1,635) — — — (1,635)
Non-cash stock compensation — — — — 712 — — 712
Net loss — — — — — — (174,298) (174,298)
Other comprehensive loss — — — — — (1,147) — (1,147)
Balance, April 19, 2020 17,851 $ 18 4,961 $ (202,343) $ 213,246 $ (5,520) $ 178,968 $ 184,369
Issuance of common stock, $0.001 par value, net of stock issuance costs 2,598 2 — — 28,723 — — 28,725
Exercise of options, issuance of restricted stock, shares exchanged for exercise and tax, and stock issued through employee stock purchase plan — — (59) 2,398 (2,228) — — 170
Non-cash stock compensation — — — — 1,071 — — 1,071
Net loss — — — — — — (56,261) (56,261)
Other comprehensive income — — — — — 17 — 17
Balance, July 12, 2020 20,449 $ 20 4,902 $ (199,945) $ 240,812 $ (5,503) $ 122,707 $ 158,091
Issuance of common stock, $0.001 par value, net of stock issuance costs — — — — (7) — — (7)
Exercise of options, issuance of restricted stock, shares exchanged for exercise and tax, and stock issued through employee stock purchase plan — — (1) 37 (73) — — (36)
Non-cash stock compensation — — — — 1,316 — — 1,316
Net loss — — — — — — (6,179) (6,179)
Other comprehensive income — — — — — 9 — 9
Balance, October 4, 2020 20,449 $ 20 4,901 $ (199,908) $ 242,048 $ (5,494) $ 116,528 $ 153,194

See Notes to Condensed Consolidated Financial Statements.

RED ROBIN GOURMET BURGERS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

(Unaudited)


	Common Stock			Treasury Stock					Accumulated Other Comprehensive Loss, net of tax
							Paid-in Capital				Retained Earnings
(in thousands)	Shares	Amount		Shares	Amount								Total
Balance, December 29, 2019	17,851	$	18	4,928	$	(202,313)	$	213,922	$	(4,373)	$	353,266	$	360,520
Exercise of options, issuance of restricted stock, shares exchanged for exercise and tax, and stock issued through employee stock purchase plan	—	—		(39)	1,605		(1,388)		—		—		217

Acquisition of treasury stock	—	—		72	(1,635)		—		—		—		(1,635)
Non-cash stock compensation	—	—		—	—		712		—		—		712
Net loss	—	—		—	—		—		—		(174,298)		(174,298)
Other comprehensive loss	—	—		—	—		—		(1,147)		—		(1,147)

Balance, April 19, 2020	17,851	$	18	4,961	$	(202,343)	$	213,246	$	(5,520)	$	178,968	$	184,369
Issuance of common stock, $0.001 par value, net of stock issuance costs	2,598	2		—	—		28,723		—		—		28,725
Exercise of options, issuance of restricted stock, shares exchanged for exercise and tax, and stock issued through employee stock purchase plan	—	—		(59)	2,398		(2,228)		—		—		170


Non-cash stock compensation	—	—		—	—		1,071		—		—		1,071
Net loss	—	—		—	—		—		—		(56,261)		(56,261)
Other comprehensive income	—	—		—	—		—		17		—		17

Balance July 12, 2020	20,449	$	20	4,902	$	(199,945)	$	240,812	$	(5,503)	$	122,707	$	158,091
Issuance of common stock, $0.001 par value, net of stock issuance costs							(7)						(7)
Exercise of options, issuance of restricted stock, shares exchanged for exercise and tax, and stock issued through employee stock purchase plan	—	—		(1)	37		(73)		—		—		(36)


Non-cash stock compensation	—	—		—	—		1,316		—		—		1,316
Net loss	—	—		—	—		—		—		(6,179)		(6,179)
Other comprehensive income	—	—		—	—		—		9		—		9
Balance, October 4, 2020	20,449	$	20	4,901	$	(199,908)	$	242,048	$	(5,494)	$	116,528	153,194

Common Stock Treasury Stock Accumulated
Other
Comprehensive
Loss,
net of tax
Paid-in
Capital Retained
Earnings
(in thousands) Shares Amount Shares Amount Total
Balance, December 30, 2018 17,851 $ 18 4,880 $ (201,505) $ 212,752 $ (4,801) $ 376,341 $ 382,805
Exercise of options, issuance of restricted stock, shares exchanged for exercise and tax, and stock issued through employee stock purchase plan — — (32) 1,344 (1,204) — — 140
Acquisition of treasury stock — — 31 (974) — — — (974)
Non-cash stock compensation — — — — 477 — — 477
Net income — — — — — — 639 639
Other comprehensive loss — — — — — (329) — (329)
Topic 842 transition impairment, net of tax — — — — — — (15,172) (15,172)
Balance, April 21, 2019 17,851 $ 18 4,879 $ (201,135) $ 212,025 $ (5,130) $ 361,808 $ 367,586
Exercise of options, issuance of restricted stock, shares exchanged for exercise and tax, and stock issued through employee stock purchase plan — — (30) 1,208 (907) — — 301
Acquisition of treasury stock — — 17 (501) — — — (501)
Non-cash stock compensation — — — — 941 — — 941
Net income — — — — — — 981 981
Other comprehensive income — — — — — 406 — 406
Balance July 14, 2019 17,851 $ 18 4,866 $ (200,428) $ 212,059 $ (4,724) $ 362,789 $ 369,714
Exercise of options, issuance of restricted stock, shares exchanged for exercise and tax, and stock issued through employee stock purchase plan — — (1) 37 (44) — — (7)
Acquisition of treasury stock — — 29 (959) — — — (959)
Non-cash stock compensation — — — — 1,126 — — 1,126
Net loss — — — — — — (1,821) (1,821)
Other comprehensive loss — — — — — (262) — (262)
Balance, October 6, 2019 17,851 $ 18 4,894 $ (201,350) $ 213,141 $ (4,986) $ 360,968 367,791

See Notes to Condensed Consolidated Financial Statements.

RED ROBIN GOURMET BURGERS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

Forty Weeks Ended
(in thousands) October 4, 2020 October 6, 2019
Cash flows from operating activities:
Net loss $ (236,738) $ (201)
Adjustments to reconcile net loss to net cash (used in) provided by operating activities:
Depreciation and amortization 68,053 71,087
Gift card breakage (2,329) (4,899)
Goodwill and restaurant asset impairment 116,193 14,064
Non-cash other charges (2,438) (11,135)
Deferred income tax provision (benefit) 52,439 (27,477)
Stock-based compensation expense 3,082 2,539
Other, net 639 665
Changes in operating assets and liabilities:
Accounts receivable 13,250 14,059
Income tax receivable (57,756) 941
Prepaid expenses and other current assets 11,229 1,426
Lease assets, net of liabilities 19,194 (266)
Trade accounts payable and accrued liabilities (9,864) (6,657)
Unearned revenue (9,331) (12,564)
Other operating assets and liabilities, net 11,976 35
Net cash (used in) provided by operating activities (22,401) 41,617
Cash flows from investing activities:
Purchases of property, equipment, and intangible assets (14,870) (33,078)
Proceeds from sales of real estate and property, plant, and equipment and other investing activities 739 178
Net cash used in investing activities (14,131) (32,900)
Cash flows from financing activities:
Borrowings of long-term debt 168,000 211,500
Payments of long-term debt and finance leases (159,004) (216,918)
Purchase of treasury stock (1,635) (2,434)
Debt issuance costs (2,952) 0
Proceeds from issuance of common stock, net of stock issuance costs 28,945 0
Proceeds from exercise of stock options and employee stock purchase plan 666 696
Net cash provided by (used in) financing activities 34,020 (7,156)
Effect of exchange rate changes on cash (166) 81
Net change in cash and cash equivalents (2,678) 1,642
Cash and cash equivalents, beginning of period 30,045 18,569
Cash and cash equivalents, end of period $ 27,367 $ 20,211
Supplemental disclosure of cash flow information
Income taxes (refund received) paid $ (2,391) $ 3,140
Interest paid, net of amounts capitalized 7,514 7,799
Change in construction related payables $ 462 $ 3,902


	Forty Weeks Ended
(in thousands)	October 3, 2021		October 4, 2020
Cash flows from operating activities:
Net loss	$	(28,689)	$	(236,738)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
Depreciation and amortization	63,984		68,053
Gift card breakage	(3,231)		(2,329)
Goodwill and asset impairment	1,357		116,193
Non-cash other charges	319		(2,438)
Deferred income tax provision	—		52,439
Stock-based compensation expense	4,501		3,082
Other, net	2,228		639
Changes in operating assets and liabilities:
Accounts receivable	4,544		13,250
Income tax receivable	520		(57,756)

Prepaid expenses and other current assets	1,014		11,229
Lease assets, net of liabilities	(12,628)		19,194
Trade accounts payable and accrued liabilities	16,948		(9,864)
Unearned revenue	(4,286)		(9,331)
Other operating assets and liabilities, net	(8,964)		11,976
Net cash provided by (used in) operating activities	37,617		(22,401)
Cash flows from investing activities:
Purchases of property and equipment	(19,987)		(14,870)
Proceeds from sales of real estate and property, plant, and equipment and other investing activities	20		739
Net cash used in investing activities	(19,967)		(14,131)
Cash flows from financing activities:
Borrowings of long-term debt	109,500		168,000
Payments of long-term debt and finance leases	(125,216)		(159,004)
Purchase of treasury stock	—		(1,635)

Debt issuance costs	(870)		(2,952)
Proceeds from issuance of common stock, net of stock issuance costs	—		28,945
Proceeds from exercise of stock options and employee stock purchase plan	549		666
Net cash (used in) provided by financing activities	(16,037)		34,020
Effect of exchange rate changes on cash	28		(166)
Net change in cash and cash equivalents	1,641		(2,678)
Cash and cash equivalents, beginning of period	16,116		30,045
Cash and cash equivalents, end of period	$	17,757	$	27,367

Supplemental disclosure of cash flow information
Income tax refunds received, net	$	(840)	$	(2,391)
Interest paid, net of amounts capitalized	$	7,586	$	7,514

See Notes to Condensed Consolidated Financial Statements.

RED ROBIN GOURMET BURGERS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

1. Basis of Presentation and Recent Accounting Pronouncements

Red Robin Gourmet Burgers, Inc., a Delaware corporation, together with its subsidiaries ("Red Robin" or the "Company"), primarily operates, franchises, and develops full-service restaurants in North America. As of October ~~4, 2020,~~3, 2021, the Company owned and operated ~~444~~430 restaurants located in 38 states. The Company also had ~~103~~101 franchised full-service restaurants in 16 states and 1 Canadian province. The Company operates its business as 1 operating and 1 reportable segment.

Basis of Presentation

The accompanying unaudited ~~condensed consolidated financial statements~~Condensed Consolidated Financial Statements include the accounts of Red Robin and its wholly owned subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. The Company's financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP") for interim financial information. In the opinion of management, all adjustments (consisting of normal recurring adjustments) considered necessary for a fair presentation have been included. The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. The results of operations for any interim period are not necessarily indicative of results for the full year.

The accompanying ~~condensed consolidated financial statements~~Condensed Consolidated Financial Statements of Red Robin have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (the "SEC"), including the instructions to Form 10-Q and Article 10 of Regulation S-X. Certain information and footnote disclosures normally included in the Company's annual consolidated financial statements on Form 10-K have been condensed or omitted. The ~~condensed consolidated balance sheet~~Condensed Consolidated Balance Sheet as of December ~~29, 2019~~27, 2020 has been derived from the audited consolidated financial statements as of that date, but does not include all disclosures required for audited annual financial statements. For further information, please refer to and read these interim ~~condensed consolidated financial statements~~Condensed Consolidated Financial Statements in conjunction with the Company's audited consolidated financial statements included in the Company's Annual Report on Form 10-K for the fiscal year ended December ~~29, 2019,~~27, 2020 filed with the SEC on ~~February 25, 2020.~~March 3, 2021.

Our current and prior year periods, period end dates, and number of weeks included in the period are summarized in the table below:

Periods

Period End Date

Number of Weeks in Period

Current and Prior Fiscal Quarters:

~~Third~~First Quarter 2021

April 18, 2021

First Quarter 2020

~~October 4,~~April 19, 2020

1216

~~Third~~Second Quarter ~~2019~~2021

~~October 6, 2019~~July 11, 2021

Second Quarter 2020

July 12, 2020

~~Second~~Third Quarter ~~2019~~2021

~~July 14, 2019~~October 3, 2021

~~First~~Third Quarter 2020

~~April 19,~~October 4, 2020

~~First Quarter 2019~~

~~April 21, 2019~~

1612

Current and Prior Fiscal Years:

Fiscal Year 2021

December 26, 2021

Fiscal Year 2020

December 27, 2020

~~Fiscal Year 2019~~

~~December 29, 2019~~

Certain amounts presented ~~in prior periods~~ have been reclassified within the October 4, 2020 Condensed Consolidated Statement of Cash Flows to conform with the current period presentation. As of December 29, 2019, the Company reclassified $5.3 million from Prepaid expenses and other current assets to Income tax receivable on the condensed consolidated balance sheets. For the forty weeks ended October 6, 2019, the Company reclassified the followingpresentation, including prior year reclassifications within net cash (used in) provided by operating activities on the condensed consolidated statements of cash flows: $14.1 million from Non-cash other charges to Goodwill and restaurant asset impairment, $0.9 million from Prepaid expenses and other current assets to Income tax receivable, and $0.3 million from OtherChanges in operating assets and ~~liabilities, net to Lease assets, net of~~ liabilities. The reclassifications had no effect on the Company’s cash flows from operations.

Certain amounts presented have been reclassified within the October 4, 2020 Condensed Consolidated Statements Of Operations And Comprehensive Loss to present General and administrative expenses and Selling expenses separately for improved comparability and alignment with industry presentation. The reclassifications had no effect on the Company’s Total costs and expenses, Loss from operations, or Net loss.

Recent Accounting Pronouncements

~~Income Taxes~~Reference Rate Reform

In ~~December 2019, the Financial Accounting Standards Board ("FASB")~~March 2020, FASB issued Update ~~2019-12, Income Taxes ("Topic 740")~~2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting. This update provides temporary optional expedients to applying the reference rate reform guidance to contracts that reference LIBOR or another reference rate expected to be discontinued. Under this update, contract modifications resulting in a new reference rate may be accounted for as ~~part~~a continuation of ~~its Simplification Initiative. This guidance provides amendments to simplify~~ the accounting for income taxes by removing certain exceptions to the general principles in Topic 740. The amendments also improve consistent application of and simplify GAAP for other areas of Topic 740 by clarifying and amending existing ~~guidance.~~contract. This guidance is effective ~~for annual~~upon issuance of the update and ~~interim reporting periods beginning after~~applies to contract modifications made through December ~~15, 2020, and early adoption is permitted.~~31, 2022. We are currently evaluating the full impact this guidance will have on our consolidated financial statements.

We reviewed all other recently issued accounting pronouncements and concluded they were either not applicable or not expected to have a significant impact on the Company's ~~condensed consolidated financial statements.~~Condensed Consolidated Financial Statements.

2. ~~COVID-19 Pandemic~~

Due to the novel coronavirus ("COVID-19") pandemic, we continue to navigate an unprecedented time for our business and industry. During the third quarter 2020, the Company continued to expand outdoor seating capacity at reopened Company-owned restaurants in accordance with local limits. Reopening dining rooms and expanding seating capacity was executed with the health, safety, and well-being of Red Robin's Team Members, Guests, and communities in mind, and strict adherence to US Centers for Disease Control and Prevention, state, and local guidelines as our top priority. The COVID-19 pandemic has had a material adverse effect on our business, and we expect the impact from COVID-19 will continue to negatively affect our business.

~~Franchise Revenue~~

In response to COVID-19's effect on our franchise operations, we temporarily abated franchise royalty payments and advertising contributions effective March 20, 2020. During periods of abated payments, franchise revenue was not recognized or collected from our franchisees. Abated royalty payments and advertising contributions will not be collected by the Company. The Company began charging and collecting partial franchise royalty payments and advertising contributions during the latter half of the second fiscal quarter of 2020, which continued throughout the Company's third fiscal quarter. As of the end of the third quarter of 2020, the Company had resumed charging full royalty and advertising contributions to our franchisees. Franchised restaurants operate under contractual arrangements with the Company, and the payments specified in the franchise contracts are accounted for under ~~ASC Topic 606, Revenue from Contracts with Customers~~.

In response to the impact of COVID-19 on our operations, beginning April 1, 2020 the Company stopped making full lease payments under its existing lease agreements. During the suspension of payments, the Company continued to recognize expenses and liabilities for lease obligations and corresponding right-of-use assets on the balance sheet in accordance with ~~ASC Topic 842~~.

We are engaging in ongoing constructive discussions with landlords regarding the potential restructuring of lease payments and rent concessions. As of October 4, 2020, the Company has contractually negotiated rent concessions with many of its landlords, with negotiations complete on approximately 50% of its leases. The types of rent concessions the Company has negotiated include early termination, early renewal, rent deferral, and rent abatement.

For contractual rent concessions that do not substantially change the total cash flows of the lease, the Company has elected to account for these concessions assuming the existing lease agreements provide enforceable rights and obligations consistent with the relief issued by the Financial Accounting Standards Board titled ~~ASCTopic 842 and ASC Topic 840: Accounting for Lease Concessions Related to the Effects of the COVID-19 Pandemic~~ ~~("FASB Relief")~~. For leases where the rent concession did not substantially change the total cash flows, the concession was accounted for as a remeasurement to the lease liability based on the original discount rate with a corresponding adjustment to the right-of-use asset. Additionally, the classification of the leases was not reassessed. The Company recorded a $2.2 million remeasurement to increase the lease liability and right-of-use asset resulting from contractual rent concessions under the FASB relief during the third fiscal quarter of 2020.

~~For contractual rent concessions that substantially changed the total cash flows of the lease and did not qualify for the FASB relief, we applied the modification framework in accordance with~~ ~~ASC Topic 842~~, ~~Leases~~. The Company reassessed lease classification for rent concessions that did not qualify for the FASB relief. During the third fiscal quarter of 2020, it was concluded no leases changed classification between operating and finance. Based on updated discount rates, a $10.1 million remeasurement was recorded to increase the lease liability and a $9.9 million adjustment, net of broker's fees, was recorded to increase the right-of-use asset during the third fiscal quarter of 2020. Contractual rent concessions granted to the Company during the third fiscal quarter of 2020 did not grant the right to use additional assets not included in the original lease contracts, so no separate contracts were accounted for as part of the rent concession modifications.

~~Restaurant Assets~~

During the twelve weeks ended October 4, 2020, the Company recognized $3.3 million of impairment related to assets at 2 permanently closed Company-owned restaurants. These impairment charges were included in Restaurant closure and refranchising costs in Other charges (gains) on the condensed consolidated statements of operation and comprehensive loss.

The March 19, 2020 passage of the Coronavirus Aid, Relief, and Economic Security Act ("CARES Act") created an opportunity for the Company to carry back 2019 and 2020 net operating losses ("NOL's"). Upon filing of its 2019 federal tax return during the third quarter of 2020 and gaining further interpretations and expert technical guidance surrounding the application of the CARES Act, the Company recorded an additional $42.8 million in federal income tax receivables to Income tax receivable on the condensed consolidated balance sheets and recorded a related income tax benefit to the condensed consolidated statements of operation and comprehensive loss. After consideration for the adjustments of carrybacks due to the CARES Act, we have a combined federal and state valuation allowance of $67.1 million, which was recorded to Other assets, net on the condensed consolidated balance sheets. Subsequent to our third quarter balance sheet date, the Company received $49.4 million in cash tax refunds, including interest, and currently expects to receive between $12 million to $15 million of additional cash tax refunds within the next 12 months. A portion of this refund was used to make a $42 million repayment on the Company's credit facility on October 30, 2020.

As of October 4, 2020, the Company had $9.7 million of net operating loss carryforwards for state income tax purposes that arose from the 2019 and 2020 tax years. The Company reclassified this amount from state tax current receivable which was recorded in Prepaid expenses and other current assets as of our second fiscal quarter of 2020, to state deferred tax asset which is recorded to Other Assets, net on the condensed consolidated balance sheets as a result of the CARES Act legislation and in conjunction with the filing of our state tax returns during our third fiscal quarter. Of these state net operating loss carryforwards, approximately $0.2 million may expire, if unused, in 2024. The remaining state net operating losses approximating $9.5 million may expire, if unused, through 2039 or in some cases will be retained for an indefinite period. The utilization of net operating loss carryforwards may be limited to 80% of taxable income in any given year. As states' CARES legislation continues to evolve these estimates may change. The total $67.1 million valuation allowance includes the $9.7 million state NOL's recorded as of October 4, 2020.

Disaggregation of revenue

In the following table, revenue is disaggregated by type of good or service (in thousands):

Franchise revenue~~(1)~~

———————————————————

~~(1)~~ ~~The decrease in Franchise revenue is driven by the temporary abatement and non-collection of franchise payments. See Note 2,~~ ~~COVID-19 Pandemic, for further discussion.~~

Contract liabilities

Components of Unearned revenue in the accompanying ~~condensed consolidated balance sheets~~Condensed Consolidated Balance Sheets are as follows (in thousands):

Revenue recognized in the ~~condensed consolidated statements~~Condensed Consolidated Statements of ~~operations~~Operations and ~~comprehensive loss~~Comprehensive Loss for the redemption and breakage of gift cards that were included in the liability balance at the beginning of the fiscal year was as follows (in thousands):

Forty Weeks Ended
October 4, 2020 October 6, 2019
Gift card revenue $ 16,191 $ 19,400


	Forty Weeks Ended
	October 3, 2021		October 4, 2020
Gift card revenue	$	14,448	$	16,191

Leases are included in right-of-use assets, net, current portion of lease obligations, and long-term portion of lease liabilities on our ~~condensed consolidated balance sheet~~Condensed Consolidated Balance Sheet as of October ~~4, 2020~~3, 2021 and December ~~29, 2019~~27, 2020 as follows (in thousands):

October 4, 2020 Finance Operating Total
Right of use assets, net $ 11,463 $ 404,485 $ 415,948
Current portion of lease obligations 1,122 60,910 62,032
Long-term portion of lease obligations 12,666 438,085 450,751
Total $ 13,788 $ 498,995 $ 512,783
December 29, 2019 Finance Operating Total
Right of use assets, net $ 7,552 $ 418,696 $ 426,248
Current portion of lease obligations 725 41,974 42,699
Long-term portion of lease obligations 8,822 456,613 465,435
Total $ 9,547 $ 498,587 $ 508,134


October 3, 2021	Finance		Operating		Total
Right of use assets, net	$	9,774	$	410,014	$	419,788

Current portion of lease obligations	1,140		48,754		49,894
Long-term portion of lease obligations	10,813		439,860		450,673
Total	$	11,953	$	488,614	$	500,567

December 27, 2020	Finance		Operating		Total
Right of use assets, net	$	9,644	$	415,929	$	425,573

Current portion of lease obligations	1,078		54,197		55,275
Long-term portion of lease obligations	10,937		454,296		465,233
Total	$	12,015	$	508,493	$	520,508

The components of lease expense, including variable lease costs primarily consisting of common area maintenance charges and real estate taxes, are included in Occupancy on our ~~condensed consolidated statement~~Condensed Consolidated Statement of ~~operations~~Operations and Comprehensive Loss as follows (in thousands):

Maturities of our lease liabilities as of October 3, 2021 were as follows (in thousands):


	Finance Leases		Operating Leases		Total
Remainder of 2021	$	550	$	14,740	$	15,290
2022	1,327		79,038		80,365
2023	1,244		76,303		77,547
2024	1,264		74,575		75,839
2025	1,283		69,959		71,242
Thereafter	9,441		377,685		387,126
Total future lease liability	$	15,109	$	692,300	$	707,409
Less imputed interest	3,156		203,686		206,842
Carrying value of lease liability	$	11,953	$	488,614	$	500,567

~~Maturities of our lease liabilities as of October 4, 2020 were as follows (in thousands):~~

Finance Leases Operating Leases Total
Remainder of 2020 $ 548 $ 29,370 $ 29,918
2021 1,450 76,091 77,541
2022 1,570 73,899 75,469
2023 1,449 71,855 73,304
2024 1,469 69,883 71,352
Thereafter 11,686 396,286 407,972
Total future lease liability $ 18,172 $ 717,384 $ 735,556
Less imputed interest 4,384 218,389 222,773
Fair value of lease liability $ 13,788 $ 498,995 $ 512,783

Supplemental cash flow and other information related to leases is as follows (in thousands, except other information):

Forty Weeks Ended
October 4, 2020 October 6, 2019
Cash flows from operating activities
Cash paid related to lease liabilities
Operating leases $ 33,034 $ 58,930
Finance leases 412 383
Cash flows from financing activities
Cash paid related to lease liabilities
Finance leases 196 686
Cash paid for amounts included in the measurement of lease liabilities: $ 33,642 $ 59,999
Right of use assets obtained in exchange for operating lease obligations $ 31,731 $ 10,396
Right of use assets obtained in exchange for finance lease obligations $ 4,581 $ 1,669
Other information related to operating leases as follows:
Weighted average remaining lease term 10.33 years 10.84 years
Weighted average discount rate 7.12 % 7.33 %
Other information related to finance leases as follows:
Weighted average remaining lease term 11.93 years 11.63 years
Weighted average discount rate 4.93 % 4.71 %


	Forty Weeks Ended
	October 3, 2021			October 4, 2020
Cash flows from operating activities
Cash paid related to lease liabilities
Operating leases	$	68,036		$	33,034
Finance leases	406			412
Cash flows from financing activities
Cash paid related to lease liabilities
Finance leases	1,447			196
Cash paid for amounts included in the measurement of lease liabilities:	$	69,889		$	33,642

Right of use assets obtained in exchange for operating lease obligations	$	27,483		$	31,731
Right of use assets obtained in exchange for finance lease obligations	$	988		$	4,581

Other information related to operating leases as follows:
Weighted average remaining lease term	9.9 years			10.3 years
Weighted average discount rate	7.01		%	7.12		%

Other information related to finance leases as follows:
Weighted average remaining lease term	11.0 years			11.9 years
Weighted average discount rate	4.56		%	4.93		%

~~5. Goodwill and Intangible Assets~~

~~The following table presents goodwill as of October 4, 2020 and December 29, 2019 (in thousands):~~


~~Balance, December 29, 2019~~	$	~~96,397~~
~~Foreign currency translation adjustment~~	~~(983)~~
~~Goodwill impairment(1)~~	~~(95,414)~~
~~Balance, October 4, 2020~~	$	0

~~———————————————————~~

~~(1)~~ ~~See Note 2,~~ ~~COVID-19 Pandemic, for further discussion of goodwill impairment recognized during the forty weeks ended October 4, 2020.~~

~~The following table presents intangible assets as of October 4, 2020 and December 29, 2019 (in thousands):~~

October 4, 2020 December 29, 2019
Gross
Carrying
Amount Accumulated
Amortization Net
Carrying
Amount Gross
Carrying
Amount Accumulated
Amortization Net
Carrying
Amount
Intangible assets subject to amortization:
Franchise rights $ 50,584 $ (36,813) $ 13,771 $ 53,336 $ (35,896) $ 17,440
Leasehold interests 13,001 (9,155) 3,846 13,001 (8,794) 4,207
Liquor licenses and other 9,961 (9,598) 363 10,737 (9,869) 868
$ 73,546 $ (55,566) $ 17,980 $ 77,074 $ (54,559) $ 22,515
Indefinite-lived intangible assets:
Liquor licenses and other $ 7,460 $ — $ 7,460 $ 7,460 $ — $ 7,460
Intangible assets, net $ 81,006 $ (55,566) $ 25,440 $ 84,534 $ (54,559) $ 29,975

Basic loss per share amounts are calculated by dividing net loss by the weighted-average number of shares of common stock outstanding during the period. Diluted loss per share amounts are calculated based upon the weighted-average number of shares of common stock and potentially dilutive shares of common stock outstanding during the period. Potentially dilutive shares are excluded from the computation in periods in which they have an anti-dilutive effect. Diluted loss per share reflects the potential dilution that could occur if holders of options exercised their options into common stock. As the Company was in a net loss position for both the twelve week and forty week periods ended October 3, 2021 and October 4, 2020, all potentially dilutive common shares are considered anti-dilutive.

The Company uses the treasury stock method to calculate the effect of outstanding stock ~~options.~~options and awards. Basic weighted average shares outstanding is reconciled to diluted weighted average shares outstanding as follows (in thousands):

Twelve Weeks Ended Forty Weeks Ended
October 4, 2020 October 6, 2019 October 4, 2020 October 6, 2019
Basic weighted average shares outstanding 15,540 12,959 13,945 12,967
Dilutive effect of stock options and awards 0 0 0 0
Diluted weighted average shares outstanding 15,540 12,959 13,945 12,967
Awards excluded due to anti-dilutive effect on diluted loss per share 895 358 480 405


	Twelve Weeks Ended		Forty Weeks Ended
	October 3, 2021	October 4, 2020	October 3, 2021	October 4, 2020
Basic weighted average shares outstanding	15,709	15,540	15,647	13,945
Dilutive effect of stock options and awards	—	—	—	—
Diluted weighted average shares outstanding	15,709	15,540	15,647	13,945

Awards excluded due to anti-dilutive effect on diluted loss per share	545	895	390	480

5. Other Charges ~~(Gains)~~

Other charges ~~(gains)~~ consist of the following (in thousands):


	Twelve Weeks Ended				Forty Weeks Ended
	October 3, 2021		October 4, 2020		October 3, 2021		October 4, 2020
Restaurant closure costs	$	1,102	$	3,982	$	5,301	$	12,990
Asset impairment	—		—		1,357		20,779
Litigation contingencies	160		—		1,330		4,500
COVID-19 related costs	299		430		1,112		1,279
Board and stockholder matter costs	—		4		128		2,453
Goodwill impairment	—		—		—		95,414
Severance and executive transition	—		—		—		881



Other charges	$	1,561	$	4,416	$	9,228	$	138,296

Twelve Weeks Ended Forty Weeks Ended
October 4, 2020 October 6, 2019 October 4, 2020 October 6, 2019
Goodwill impairment $ 0 $ 0 $ 95,414 $ 0
Restaurant asset impairment 0 0 20,779 14,064
Restaurant closure and refranchising costs (gains) 3,982 (3,922) 12,990 (2,617)
Litigation contingencies 0 0 4,500 0
Board and stockholder matter costs 4 1,311 2,453 2,463
COVID-19 related costs 430 0 1,279 0
Severance and executive transition 0 594 881 2,958
Executive retention 0 260 0 620
Other charges (gains) $ 4,416 $ (1,757) $ 138,296 $ 17,488
Restaurant closure costs represent costs incurred for permanently closed restaurants, including lease termination costs, as well as the ongoing restaurant operating costs of Company-owned restaurants that remained temporarily closed due to the COVID-19 pandemic.

During the forty weeks ended October 3, 2021, Asset impairment primarily related to the impairment of long-lived assets at 1 Company-owned restaurant with a carrying value of $3.8 million (including right of use assets), recognizing an impairment expense of $1.2 million related to the net book value of long-lived restaurant assets for this restaurant. During the twelve and forty weeks ended October 4, 2020 the Company recognized non-cash impairment charges related to restaurant assets at 2 and NaN Company-owned restaurants, respectively, resulting from quantitative impairment analyses.

Litigation contingencies include legal settlement costs accrued within the period presented related to class action employment cases and other employment matters.

COVID-19 related costs include the costs of purchasing personal protective equipment for restaurant Team Members and Guests and emergency sick pay provided to restaurant Team Members during the pandemic.

Board and stockholder matters costs were primarily related to the recruitment and appointment of new board members, and other board and stockholder matters.

We performed a goodwill impairment analysis during the first quarter of 2020 resulting in full impairment of our goodwill balance. The goodwill impairment was measured as the amount by which the carrying amount of the reporting unit, including goodwill, exceeded its fair value.

The Company recognized non-cash impairment charges related to restaurant assets at 30 and 29 Company-owned restaurants during the forty weeks ended October 4, 2020 and October 6, 2019 resulting from quantitative impairment analyses. Additionally, the Company recognized non-cash impairment charges of $3.3 million and $5.7 million resulting from 2 and 6 restaurant closures during the twelve and forty weeks ended October 4, 2020 included within Restaurant closure and refranchising costs.

Restaurant closure and refranchising costs (gains) include the restaurant operating costs of the Company-owned restaurants that remained temporarily closed due to the COVID-19 pandemic. Gains are driven by early lease terminations on previously closed restaurants.

~~Litigation contingencies include legal settlement costs related to two class action employment cases.~~

Severance and executive transition in 2020 primarily relates to severance costs associated with the reduction in force of restaurant support center Team ~~Members.~~

~~COVID-19 related costs include the costs of purchasing personal protective equipment for restaurant Team~~ Members ~~and Guests and emergency sick pay provided to restaurant Team Members during the pandemic.~~in April 2020.

~~Total borrowings~~Borrowings as of October ~~4, 2020~~3, 2021 and December ~~29, 2019 were $216.1 million and $206.9 million. As~~27, 2020 are summarized below (in thousands):


	October 3, 2021				December 27, 2020
	Borrowings		Weighted Average Interest Rate		Borrowings		Weighted Average Interest Rate
Revolving credit facility, term loan, and other long-term debt	$	157,163	6.80	%	$	170,644	4.50	%
Total debt	157,163				170,644
Less current portion	9,692				9,692
Long-term debt	$	147,471			$	160,952

Amounts issued under letters of credit	$	8,600			$	8,700

Table of ~~October 4, 2020, the current portion of long-term borrowings was $9.7 million; 0 borrowings as of December 29, 2019 were classified as current.~~Contents

As of October 4, 2020, the Company had outstanding borrowings under its credit facility of $215.2 million, in addition to amounts issued under letters of credit of $7.9 million. The amounts issued under letters of credit reduce the amount available under the facility but were not recorded as debt. As of December 29, 2019, the Company had outstanding borrowings under the prior credit facility of $206 million, in addition to amounts issued under letters of credit of $7.5 million.

Loan origination costs associated with the Company's ~~credit facility~~Amended and Restated Credit Agreement (the "Credit Facility") are included as deferred costs in Other assets, net in the accompanying ~~condensed consolidated balance sheets.~~Condensed Consolidated Balance Sheets. Unamortized debt issuance costs were ~~$3.5~~$2.0 million and $1$3.3 million as of October ~~4, 2020~~3, 2021 and December ~~29, 2019.~~27, 2020.

Third Amendment to Credit Agreement

In response to the continued uncertainty around the impact of industry labor and supply chain challenges as well as the COVID-19 Delta variant, the Company amended its current credit facility on November 9, 2021 (the "Third Amendment") to obtain additional flexibility to continue to implement our business strategy. The Company anticipates refinancing its Credit Facility in 2022. The Third Amendment further amends the Company’s Amended and Restated Credit Agreement (as amended, the "Credit Facility") to, among other things:

•waive the application of the lease adjusted leverage ratio financial covenant (the "Leverage Ratio Covenant") for the third fiscal quarter of 2021

•increase the maximum leverage permitted for purposes of the Leverage Ratio Covenant for the fourth fiscal quarter of 2021 and the first, second and third fiscal quarters of 2022, with the definition of the Leverage Ratio Covenant also being amended to provide that it shall not be calculated on a basis that gives effect to a seasonally adjusted annualized consolidated EBITDA in future periods;

•decrease the minimum fixed charge coverage ratio required for purposes of the fixed charge coverage ratio financial covenant (the “FCCR Covenant”) for the first fiscal quarter of 2022, with the definition of the FCCR Covenant also being amended to account for cash tax refunds received in any future period and certain capital expenditures constituting "Expansion Capital Expenditures" being excluded from the calculation thereof;

•decrease the minimum liquidity required for purposes of the minimum liquidity covenant and provide for the testing of such minimum liquidity covenant at all times;

•make certain amendments to the Credit Facility to (i) provide that certain additional capital expenditures shall constitute "Expansion Capital Expenditures" and (ii) provide that "Expansion Capital Expenditures" shall be permitted for all periods on or prior to the last day of the fiscal quarter of the Company ending on or about October 2, 2022, so long as (1) there is no default or event of default, (2) on a pro forma basis, Liquidity shall exceed a certain amount and (3) such "Expansion Capital Expenditures" do not exceed certain agreed amounts in each fiscal quarter (with carryforward of unused amounts to the immediately succeeding fiscal quarter), and, for all periods thereafter, so long as (1) there is no default or event of default, (2) on a pro forma basis, Liquidity shall exceed a certain amount and (3) on a pro forma basis, lease adjusted leverage ratio shall not exceed 5.00x;

•increase the pricing under the Credit Facility for (a) the period from the Third Amendment Effective Date through the first interest determination date occurring after the last day of the fiscal quarter of the Company ending on or about April 17, 2022 to LIBOR (subject to a 1.00% floor) plus 6.00% and (b) periods thereafter to LIBOR (to which a 1.00% LIBOR floor shall apply) plus 6.50%;

•provide that the previously agreed utilization fee of 0.75% per annum of the daily outstanding principal amount of term loans, revolving loans, swingline loans and letter of credit obligations under the Credit Facility shall be owing solely in respect of the period commencing on February 25, 2021 and ending on the Third Amendment Effective Date, with all such amounts payable on the Third Amendment Effective Date;

•reduce the aggregate revolving commitment to $75,000,000 on the last day of the fiscal quarter of the Company ending on or about April 17, 2022;

•amend the anti-cash hoarding provision to require revolver repayments (but with no associated permanent reduction in the revolving commitment) to the extent that the Company’s consolidated cash on hand exceeds $30,000,000 at any time;

•revise the requirement that the annual audited financial statements be delivered without a "going concern qualification" to permit such a qualification solely relating to (i) any impending debt maturity (whether under the Credit Facility or otherwise) or (ii) any actual or prospective inability to satisfy a financial maintenance covenant; and

•make certain amendments to the Credit Facility to address LIBOR transition matters.

Table of Contents

The description above is a summary of the Third Amendment and is qualified in its entirety by the complete text of the agreement, which is incorporated herein by reference. In conjunction with the Third Amendment, the Company paid certain customary amendment fees to the lenders under the Credit Facility totaling approximately $0.8 million, which will be capitalized as deferred loan fees and amortized over the remaining term of the Credit Facility.

9.7. Fair Value Measurements

Assets and Liabilities Measured at Fair Value on a Recurring Basis

The carrying amounts of the Company's cash and cash equivalents, accounts receivable, accounts payable, and current accrued expenses and other liabilities approximate fair value due to the short term nature or maturity of the instruments.

The following tables present the Company's assets measured at fair value on a recurring basis included in Other assets, net on the accompanying ~~condensed consolidated balance sheets~~Condensed Consolidated Balance Sheets as of October ~~4, 2020~~3, 2021 and December ~~29, 2019~~27, 2020 (in thousands):

October 4, 2020 Level 1 Level 2 Level 3
Assets:
Investments in rabbi trust $ 6,232 $ 6,232 $ 0 $ 0
Total assets measured at fair value $ 6,232 $ 6,232 $ 0 $ 0
December 29, 2019 Level 1 Level 2 Level 3
Assets:
Investments in rabbi trust $ 7,337 $ 7,337 $ 0 $ 0
Total assets measured at fair value $ 7,337 $ 7,337 $ 0 $ 0

~~Table of Contents~~


	October 3, 2021		Level 1		Level 2		Level 3
Assets:
Investments in rabbi trust	$	5,999	$	5,999	$	—	$	—
Total assets measured at fair value	$	5,999	$	5,999	$	—	$	—

	December 27, 2020		Level 1		Level 2		Level 3
Assets:
Investments in rabbi trust	$	6,740	$	6,740	$	—	$	—
Total assets measured at fair value	$	6,740	$	6,740	$	—	$	—

Assets and Liabilities Measured at Fair Value on a Nonrecurring Basis

Assets and liabilities recognized or disclosed at fair value on the ~~condensed consolidated financial statements~~Condensed Consolidated Financial Statements on a nonrecurring basis include items such as property, plant and equipment, right of use assets, goodwill, and other intangible assets. These assets are measured at fair value if determined to be impaired.

The Company has measured non-financial assets for impairment using continuing and projected future cash flows, which were based on significant inputs not observable in the market and thus represented a level 3 fair value measurement. ~~Based~~See footnote 5 Other Charges of this Quarterly Report on our restaurant asset impairment analyses during fiscal year 2020, we impaired long-lived assets at 36 Company-owned restaurants with carrying values of $61.4 million. We determined the fair value of these long-lived restaurant assets to be $34.9 million. During fiscal year 2019, we impaired long-lived assets at 29 Company-owned restaurants with carrying values of $17.3 million. We determined the fair value of these long-lived restaurant assets to be $2.2 million.Form 10-Q for additional detail.

Disclosures of Fair Value of Other Assets and Liabilities

The Company's liability under its ~~credit facility~~Credit Facility is carried at historical cost in the accompanying ~~condensed consolidated balance sheets. Due to market interest rates decreasing during fiscal year 2020, the Company determined~~Condensed Consolidated Balance Sheets. As of October 3, 2021, the carrying value of the liability under ~~its credit facility did not approximate~~the Company's Credit Facility approximated fair value. ~~The~~As of December 27, 2020, the carrying value and fair value of the ~~credit facility as of October 4, 2020~~Credit Facility were ~~$215.2~~$169.8 million and ~~$218.6~~$172.6 million. ~~As of December 29, 2019, the carrying value of the credit facility approximated fair value as the interest rate on the instrument approximated current market rates.~~ The interest rate on the ~~credit facility~~Credit Facility represents a level 2 fair value input.

~~10.~~8. Commitments and Contingencies

On July 14, 2017, a current hourly employee filed a class action lawsuit alleging that the Company failed to provide required meal breaks and rest periods and failed to reimburse business expenses, among other claims. The case is styled Manuel Vigueras v. Red Robin International, Inc. and is currently pending before the United States District Court in Santa Ana, California. In a related action, on September 21, 2017, a companion case, styled Genny Vasquez v. Red Robin International, Inc. was filed and is currently pending in California Superior Court in Santa Ana, California and involves claims under the California Private Attorneys' General Act that partially overlap the claims made in the Vigueras matter. In the first quarter of 2020, the Company reached a tentative settlement agreement resolving all claims and the cost of class administration in both cases for an aggregate $8.5 million. The Company is in the process of finalizing the settlement agreement, which will then be submitted to the court for approval. Court approval is required before any settlement agreement between the parties becomes final. An additional $4.5 million was accrued to reach the $8.5 million settlement amount during the first fiscal quarter of 2020. Amounts recorded in the periods presented for litigation contingencies are disclosed in Note 7, ~~Other Charges~~.

In the normal course of business, there are various claims in process, matters in litigation, and other contingencies. These include ~~employment-related~~employment related claims and claims from Guests or Team Members alleging illness, injury, ~~or other~~ food quality, health, or operational issues. Evaluating contingencies related to litigation is a complex process involving subjective judgment on the potential outcome of future events, and the ultimate resolution of litigated claims may differ from our current analysis. We review the adequacy of accruals and disclosures pertaining to litigation matters each quarter in consultation with legal counsel, and we assess the probability and range of possible losses associated with contingencies for potential accrual in the consolidated financial statements.concerns. While it is not possible to predict the outcome of these suits, legal proceedings, and claims with certainty, management is of the opinion that adequate provision for potential losses associated with these matters has been made in the ~~condensed consolidated~~ financial ~~statements.~~statements and that the ultimate resolution of these matters will not have a material adverse effect on our financial position and results of operations.

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ITEM 2. Management's Discussion and Analysis of Financial Condition and Results of Operations

Management's Discussion and Analysis of Financial Condition and Results of Operations provides a narrative of our financial performance and condition that should be read in conjunction with the accompanying ~~condensed consolidated financial statements.~~Condensed Consolidated Financial Statements. All comparisons under this heading between ~~2020~~2021 and ~~2019~~2020 refer to the twelve and forty weeks ended October ~~4, 2020~~3, 2021 and October ~~6, 2019,~~4, 2020, unless otherwise indicated.

Overview

Description of Business

Red Robin Gourmet Burgers, Inc., a Delaware corporation, together with its subsidiaries ("Red Robin," "we," "us," "our," or the "Company"), primarily operates, franchises, and develops full-service restaurants with ~~547~~531 locations in North America. As of October ~~4, 2020,~~3, 2021, the Company owned ~~444~~430 restaurants located in 38 states. The Company also had ~~103~~101 franchised full-service restaurants in 16 states and one Canadian province. The Company operates its business as one operating and one reportable segment.

COVID-19 Impact

The COVID-19 pandemic continues to create unprecedented challenges for our industry including government mandated restrictions, changing consumer behavior, labor and supply chain challenges, and wide spread inflationary costs. Even as government restrictions were lifted, and dining rooms returned to full capacity, the surge in the Delta variant continued to highlight the critical importance of providing a safe environment for our Team Members and Guests.

In response to these COVID-19 challenges, the Company ~~Response~~limited dining hours and seating capacity in order to ~~COVID-19 Pandemic~~preserve the consistent quality experience our Guests expect from us. Our disciplined Guest focus is delivered through our Total Guest Experience hospitality model ("TGX"), off-premises enhancements, and our management labor model.

~~Due~~Our ability to attract and retain Team Members has become more challenging in the current competitive job market. Staffing is our number one priority; we have supported our staffing efforts through technology enhancements to the ~~novel coronavirus ("COVID-19") pandemic, we continue~~application and hiring process, improving our wage policies, holding national hiring days, and deploying internal and external resources to ~~navigate an unprecedented time for~~augment recruiting, hiring, and training efforts. The challenges in hiring and retention and global supply chain disruptions have affected many of our ~~business~~vendor partners, resulting in intermittent product and industry. During the third quarter of 2020, the Company continued to expand outdoor seating capacity at reopened Company-owned restaurants in accordance with local limits. Reopening dining rooms and expanding seating capacity was executed with the health, safety, and well-being of Red Robin's Team Members, Guests, and communities in mind with strict adherence to US Centers for Disease Control and Prevention, state, and local guidelines as our top priority. Our continued focus during the COVID-19 pandemic on delivering best-in-class hospitality has resulted in improved average weekly net sales per restaurant and record high Guest satisfaction scores since the onset of the pandemic in early March.distribution shortages.

We remain focused on ~~expanding indoor and outdoor seating capacity, retaining off-premise sales levels, and consistently~~proactively addressing these industry challenges, while delivering a great Guest experience and continuing to ~~continue to drive our improving sales. We expect to build further sales momentum from additional seating expansion, including use of outdoor all-weather tents~~prioritize the satisfaction and indoor booth partitions. We also continue to require Guests to wear face coverings at all locations while entering, exiting, and walking around our restaurants, and face masks are provided for Guests who arrive without one to ensure we are enabling the mutual safetyretention of our ~~Guests and~~ Team Members.

As our dining rooms have reopened, sales and the Guest experience have been positively impacted by the accelerated implementation of our new Total Guest Experience ("TGX") hospitality model, coupled with strong adherence to health and safety standards. Notably, restaurants with reopened dining rooms are retaining meaningful off-premise sales, demonstrating the enduring and growing popularity of Red Robin for off-premise occasions.

We have secured the Company's long-term viability through increased liquidity from our at-the-market equity offering, reductions in overhead costs, receipt of a $49.4 million federal cash tax refund subsequent to the third quarter balance sheet date, including interest, provided under the provisions of the CARES Act, and $12 million to $15 million of additional federal cash tax refunds expected to be received in 2021. This allows us to resume full implementation of the Company's previously disclosed strategic plan to transform the business and create long-term stockholder value through delivering best-in-class execution, including implementing our TGX hospitality model, rolling out Donatos® Pizza, optimizing the restaurant portfolio, and enhancing our technological and digital capabilities to drive increased Guest engagement and frequency with our brand.

The Company was required to re-close dining rooms during the second fiscal quarter at numerous Company-owned restaurants, including 53 indoor dining rooms in California due to a state mandate in early July, from the effects of increased COVID-19 cases in certain states and localities. These indoor dining rooms have started to reopen during the third fiscal quarter, while maintaining improved off-premise performance.

Each of our franchisees' restaurants remained open as of the end of our third fiscal quarter, and we started charging and collecting full royalty payments and advertising contributions from our franchisees as of the end of our third fiscal quarter.

As of November 1, 2020, the Company has reopened 370 total (comparable and non-comparable) indoor dining rooms with limited capacity, representing approximately 89% of currently open Company-owned restaurants. Notably, these restaurants have on average maintained off-premise sales that are approximately 35% of sales mix after reopening dining rooms. As of the filing date of this Form 10-Q, 18 restaurants remain temporarily closed due to the COVID-19 pandemic. We will continue to evaluate the potential timing of reopening these remaining temporarily closed restaurants. Restaurant operating level expenses incurred for these restaurants during the temporary closures have been recorded in Restaurant closure and refranchising costs (gains) in Other charges (gains); see Note 7, ~~Other Charges (Gains), in the Notes to the Condensed Consolidated Financial Statements in Part 1, Item 1 of this Quarterly Report on Form 10-Q.~~

~~Table of Contents~~

Net comparable restaurant revenue and average weekly net sales per Company-owned restaurant with reopened indoor dining rooms for the Company's 28 day accounting periods through November 1, 2020 is as follows:

Period Ended(2)
Reopened Company-owned Restaurant Indoor Dining Rooms 9-Aug 6-Sept 4-Oct
1-Nov(3)
Net comparable restaurant revenues (29.1)% (20.1)% (9.5)% (13.7)%
Average weekly net sales per restaurant $38,779 $41,272 $43,034 $42,778
# of comparable Company-owned restaurants(1)
340 347 381 362

~~———————————————————~~

~~(1)~~ ~~Net sales performance for Company-owned restaurants with reopened indoor dining rooms for the full period presented. Restaurant count is as of the end of the period presented.~~

~~(2)~~ The period ended August 9, September 6, and October 4, 2020 comprise the Company's third fiscal quarter. The period ended November 1, 2020 falls within our fourth fiscal quarter, and amounts presented for the period are preliminary.

~~(3)~~ Sales performance at restaurants with reopened dining rooms during the period ended November 1, 2020 was negatively impacted by rising COVID-19 cases resulting in new restrictions lowering dining room capacity in certain states and localities. The negative impact was partially offset by sales benefits from expanded outdoor seating and increased use of booth partitions, improved off-premise sales performance in California, and average check growth during the period. Additionally, Halloween shifted from a Thursday to a Saturday in 2020, negatively impacting comparable restaurant revenues by approximately 1.0% to 2.0% for the period ended November 1, 2020.

~~Net comparable restaurant revenue and average weekly net sales per Company-owned restaurant for the Company's 28 day accounting periods through November 1, 2020 is as follows:~~

Period Ended(2)
Company-owned Restaurants 9-Aug 6-Sept 4-Oct
1-Nov(3)
Net comparable restaurant revenues (34.2)% (24.9)% (14.9)% (15.4)%
Average weekly net sales per restaurant $36,830 $39,728 $41,731 $42,509
# of comparable Company-owned restaurants(1)
412 412 412 412

~~———————————————————~~

~~(1)~~ Comparable restaurants are those Company-owned restaurants that have operated five full quarters as of the period or week presented. Restaurant count shown is as of the end of the period or week presented.

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Financial and Operational Highlights

The following summarizes the operational and financial highlights during the twelve ~~and forty~~ weeks ended October ~~4, 2020:~~3, 2021:

•Restaurant ~~revenue decreased $92.9 million, or 32.0%, to $197.0 million for the twelve weeks ended October 4, 2020, as~~Revenue, compared to the ~~twelve weeks ended October 6, 2019, due to a $65.7 million, or 25.1%, decrease~~same period in the prior year, is presented in the table below:




	(millions)
Restaurant Revenue for the twelve weeks ended October 4, 2020	$	197.0
Increase in comparable restaurant revenue	67.0
Increase from non-comparable restaurants	6.2
Total increase	73.2
Restaurant Revenue for the twelve weeks ended October 3, 2021	$	270.2

The following summarizes the operational and ~~a $27.2 million decrease primarily from closed restaurants.~~

•~~Restaurant revenue decreased $334.2 million, or 33.7%, to $658.6 million for~~financial highlights during the forty weeks ended October ~~4, 2020, as~~3, 2021:

Restaurant Revenue, compared to the ~~forty weeks ended October 6, 2019, due to a $252.1 million, or 28.3%, decrease~~same period in ~~comparable restaurant revenue and a $82.1 million decrease primarily from closed restaurants.~~the prior year, is presented in the table below:




	(millions)
Restaurant Revenue for the forty weeks ended October 4, 2020	$	658.6
Increase in comparable restaurant revenue	200.6
Decrease from non-comparable restaurants	1.8
Total increase	202.4
Restaurant Revenue for the forty weeks ended October 3, 2021	$	861.0

•Restaurant revenues and operating costs as a percentage of restaurant revenue ~~increased 750 basis points to 91.4%~~ for the ~~twelve weeks ended October 4, 2020, as compared~~period are detailed in the table below:


	Twelve weeks ended				2021 compared to 2020		Twelve Weeks Ended			2021 compared to 2019(1)
	October 3, 2021		October 4, 2020		Increase/(Decrease)		October 6, 2019(1)			Increase/(Decrease)
Restaurant revenue (millions)	$	270.2	$	197.0	37.2	%	$	289.9		(6.8)	%
Restaurant operating costs:	(Percentage of Restaurant Revenue)				(Basis Points)		(Percentage of Restaurant Revenue)			(Basis Points)
Cost of sales	23.2 %		23.4 %		(20)		23.8		%	(60)
Labor	36.9 %		37.7 %		(80)		36.2		%	70
Other operating	19.0 %		19.1 %		(10)		15.3		%	370
Occupancy	8.3 %		11.2 %		(290)		8.6		%	(30)
Total	87.5 %		91.4 %		(390)		83.9		%	360

(1) Presented for improved comparability to ~~83.9%~~pre-COVID-19 operations.


	Forty weeks ended					2021 compared to 2020		Forty Weeks Ended			2021 compared to 2019(1)
	October 3, 2021			October 4, 2020		Increase/(Decrease)		October 6, 2019(1)			Increase/(Decrease)
Restaurant revenue (millions)	$	861.0		$	658.6	30.7	%	$	992.8		(13.3)	%
Restaurant operating costs:	(Percentage of Restaurant Revenue)					(Basis Points)		(Percentage of Restaurant Revenue)			(Basis Points)
Cost of sales	22.5 %			23.6 %		(110)		23.7		%	(120)
Labor	36.0 %			38.8 %		(280)		35.7		%	30
Other operating	18.1 %			18.9 %		(80)		14.4		%	370
Occupancy	8.6 %			11.6 %		(300)		8.6		%	—
Total	85.3		%	92.9 %		(760)		82.4		%	280

(1) Presented for ~~the twelve weeks ended October 6, 2019. The increase was due~~improved comparability to ~~higher other operating costs, labor costs, and occupancy costs as a percentage~~pre-COVID-19 operations.

Table of ~~restaurant revenue, partially offset by lower cost of sales as a percentage of restaurant revenue.~~Contents

•Restaurant operating costs, as a percentage of restaurant revenue, increased 1,050 basis points to 92.9% for the forty weeks ended October 4, 2020, as compared to 82.4% for the forty weeks ended October 6, 2019. The ~~increase was due to higher other operating costs, labor costs, and occupancy costs as a percentage of restaurant revenue, partially offset by lower cost of sales as a percentage of restaurant revenue.~~

•following table summarizes Net loss, ~~was $6.2 million for the twelve weeks ended October 4, 2020 compared to net~~ loss of $1.8 million for the twelve weeks ended October 6, 2019. Diluted loss per share was $0.40 for the twelve weeks ended October 4, 2020, as compared to diluted loss per share of $0.14 for the twelve weeks ended October 6, 2019. Excluding costs per diluted share, ~~included in Other charges (gains) of $0.19 for restaurant closure~~ and ~~refranchising costs and $0.02 for COVID-19 related costs,~~ adjusted loss per diluted share for the twelve ~~weeks ended October 4, 2020, was $0.19. Excluding a gain per diluted share included in Other charges (gains) of $0.23 for lease terminations for previously closed restaurants,~~ and costs per diluted share included in Other charges (gains) of $0.07 for board and stockholder matters costs, $0.04 for severance and executive transition, and $0.02 for executive retention, adjusted loss per diluted share for the twelve weeks ended October 6, 2019 was $0.24.

•~~Net loss was $236.7 million for the~~ forty weeks ended October ~~4, 2020 compared to net loss of $0.2 million for the forty weeks ended October 6, 2019. Diluted loss per share was $16.98 for the forty weeks ended~~3, 2021 and October 4, 2020, as compared to diluted loss per share of $0.02 for the forty weeks ended October 6, 2019. Excluding costs per diluted share included in Other charges (gains) of $5.07 for goodwill impairment, $1.10 for restaurant asset impairment, $0.69 for restaurant closure and refranchising costs, $0.24 for litigation contingencies, $0.13 for board and stockholder matters costs, $0.07 for COVID-19 related costs, and $0.04 for severance and executive transition, adjusted loss per diluted share for the forty weeks ended October 4, 2020 was $9.64. Excluding costs per diluted share included in Other charges (gains) of $0.80 for restaurant asset impairment, $0.17 for severance and executive transition, $0.14 for board and stockholder matters costs, and $0.04 for executive retention, and a gain included in Other charges (gains) of $0.15 for lease terminations for previously closed restaurants, adjusted earnings per diluted share for the forty weeks ended October 6, 2019 was $0.98.2020;


	Twelve Weeks Ended				Forty Weeks Ended
	October 3, 2021		October 4, 2020		October 3, 2021		October 4, 2020
Net loss as reported	$	(14,980)	$	(6,179)	$	(28,689)	$	(236,738)


























Loss per share - diluted:
Net loss as reported	$	(0.95)	$	(0.40)	$	(1.83)	$	(16.98)
Restaurant closure costs	0.07		0.26		0.34		0.93
Asset impairment	—		—		0.09		1.49
Litigation contingencies	0.01		—		0.08		0.32
COVID-19 related costs	0.02		0.03		0.07		0.09
Board and stockholder matter costs	—		—		0.01		0.18
Severance and executive transition	—		—		—		0.06
Goodwill impairment	—		—		—		6.84


Income tax effect	(0.03)		(0.08)		(0.16)		(2.57)
Adjusted loss per share - diluted	$	(0.88)	$	(0.19)	$	(1.40)	$	(9.64)

Weighted average shares outstanding
Basic	15,709		15,540		15,647		13,945
Diluted	15,709		15,540		15,647		13,945

•We believe the non-GAAP measure of adjusted ~~earnings (loss)~~loss per diluted share gives the reader additional insight into the ongoing operational results of the Company, and it is intended to supplement the presentation of the Company's financial results in accordance with GAAP.

•~~Marketing -~~ Our Red Robin Royalty™ loyalty program operates in all our U.S. Company-owned Red Robin restaurants and has been rolled out to most of our franchised restaurants. We engage our Guests through Red Robin Royalty with offers designed to increase frequency of visits as a key part of our overall marketing strategy. Our media buying approach has pivoted to prioritize digital, social, and owned channels including our website and email to effectively target and reach our Guests.

~~Table of Contents~~

Restaurant Data

The following table details restaurant unit data for our Company-owned and franchised locations for the periods indicated:

Twelve Weeks Ended Forty Weeks Ended
October 4, 2020 October 6, 2019 October 4, 2020 October 6, 2019
Company-owned:
Beginning of period 450 472 454 484
Opened during the period — 1 — —
Closed during the period(1)
(6) (2) (10) (13)
End of period 444 471 444 471
Franchised:
Beginning of period 102 90 102 89
Opened during the period 1 — 1 1
End of period 103 90 103 90
Total number of restaurants 547 561 547 561


	Twelve Weeks Ended		Forty Weeks Ended
	October 3, 2021	October 4, 2020	October 3, 2021	October 4, 2020
Company-owned:
Beginning of period	430	450	443	454


Closed during the period	—	(6)	(13)	(10)
End of period	430	444	430	444
Franchised:
Beginning of period	101	102	103	102
Opened during the period	—	1	—	1
Closed during the period	—	—	(2)	—
End of period	101	103	101	103
Total number of restaurants	531	547	531	547

~~(1)~~

Table of Contents~~In addition to the permanent closures during the twelve~~

The following table presents total Company-owned and ~~forty weeks ended October 4, 2020, 24 Company-owned~~franchised restaurants ~~remained temporarily closed due to the COVID-19 pandemic~~by state or province as of October 4, 2020. Of the 35 temporarily closed Company-owned restaurants at the beginning of the third fiscal quarter, six restaurants have been reopened and five restaurants have been permanently closed during the twelve weeks ended October 4, 2020. Additionally, six more temporarily closed Company-owned restaurants were reopened during the beginning of our fourth fiscal quarter.3, 2021:


	Company-Owned Restaurants	Franchised Restaurants

State:
Arkansas	2	2
Alaska	—	3
Alabama	4	—
Arizona	18	1
California	59	—
Colorado	22	—
Connecticut	—	3
Delaware	—	5
Florida	19	—
Georgia	6	—
Iowa	5	—
Idaho	8	—
Illinois	22	—
Indiana	13	—
Kansas	—	4
Kentucky	4	—
Louisiana	2	—
Massachusetts	4	2
Maryland	13	—
Maine	2	—
Michigan	—	20
Minnesota	4	—
Missouri	8	3
Montana	—	2
North Carolina	17	—
Nebraska	4	—
New Hampshire	3	—
New Jersey	12	1
New Mexico	3	—
Nevada	6	—
New York	14	—
Ohio	18	2
Oklahoma	5	—
Oregon	15	5
Pennsylvania	11	21
Rhode Island	1	—
South Carolina	4	—
South Dakota	1	—
Tennessee	11	—
Texas	20	9
Utah	1	6
Virginia	20	—
Washington	38	—
Wisconsin	11	—

Province:
British Columbia	—	12
Total	430	101

———————————————————

1716

Table of Contents

Results of Operations

Operating results for each fiscal period presented below are expressed as a percentage of total revenues, except for the components of restaurant operating costs, which are expressed as a percentage of restaurant revenue.

This information has been prepared on a basis consistent with our audited ~~2019~~2020 annual financial statements, and, in the opinion of management, includes all adjustments, consisting only of normal recurring adjustments, necessary for a fair presentation of the information for the periods presented. Our operating results may fluctuate significantly as a result of a variety of factors, and operating results for any period presented are not necessarily indicative of results for a full fiscal year.


		Twelve Weeks Ended				Forty Weeks Ended					Twelve Weeks Ended						Forty Weeks Ended
		October 4, 2020		October 6, 2019		October 4, 2020		October 6, 2019			October 3, 2021		October 4, 2020		October 6, 2019(1)			October 3, 2021		October 4, 2020		October 6, 2019(1)
Revenues:	Revenues:									Revenues:
Restaurant revenue	Restaurant revenue	98.3	%	98.5	%	98.6	%	98.1	%	Restaurant revenue	98.1 %		98.3 %		98.5	%		98.0 %		98.6 %		98.1	%
Franchise and other revenues	Franchise and other revenues	1.7		1.5		1.4		1.9		Franchise and other revenues	1.9 %		1.7 %		1.5	%		2.0 %		1.4 %		1.9	%
Total revenues	Total revenues	100.0		100.0		100.0		100.0		Total revenues	100.0 %		100.0 %		100.0	%		100.0 %		100.0 %		100.0	%

Costs and expenses:	Costs and expenses:									Costs and expenses:
Restaurant operating costs (exclusive of depreciation and amortization shown separately below):	Restaurant operating costs (exclusive of depreciation and amortization shown separately below):									Restaurant operating costs (exclusive of depreciation and amortization shown separately below):
Cost of sales	Cost of sales	23.4		23.8		23.6		23.7		Cost of sales	23.2 %		23.4 %		23.8	%		22.5 %		23.6 %		23.7	%
Labor	Labor	37.7		36.2		38.8		35.7		Labor	36.9 %		37.7 %		36.2	%		36.0 %		38.8 %		35.7	%
Other operating	Other operating	19.1		15.3		18.9		14.4		Other operating	19.0 %		19.1 %		15.3	%		18.1 %		18.9 %		14.4	%
Occupancy	Occupancy	11.2		8.6		11.6		8.6		Occupancy	8.3 %		11.2 %		8.6	%		8.6 %		11.6 %		8.6	%
Total restaurant operating costs	Total restaurant operating costs	91.4		83.9		92.9		82.4		Total restaurant operating costs	87.5 %		91.4 %		83.9	%		85.3	%	92.9 %		82.4	%
Depreciation and amortization	Depreciation and amortization	9.6		7.2		10.2		7.0		Depreciation and amortization	6.9 %		9.6 %		7.2	%		7.3 %		10.2 %		7.0	%
Selling, general and administrative		10.6		12.5		12.4		11.8
General and administrative expenses										General and administrative expenses	6.4 %		7.6 %		6.5	%		6.6 %		8.4 %		7.0	%
Selling expenses										Selling expenses	4.6 %		3.0 %		6.0	%		3.6 %		4.0 %		4.8	%
Pre-opening and acquisition costs	Pre-opening and acquisition costs	—		—		—		—		Pre-opening and acquisition costs	0.2 %		—	%	—	%		0.1 %		—	%	—	%
Other charges (gains)		2.2		(0.6)		20.7		1.7
Other charges										Other charges	0.6 %		2.2 %		(0.6)	%		1.1 %		20.7 %		1.7	%
Loss from operations	Loss from operations	(12.3)		(1.8)		(35.0)		(1.4)		Loss from operations	(4.4)	%	(12.3)	%	(1.8)	%		(2.2)	%	(35.0)	%	(1.4)	%

Interest expense, net and other	Interest expense, net and other	1.1		0.6		1.1		0.7		Interest expense, net and other	1.0 %		1.1 %		0.6	%		1.1 %		1.1 %		0.7	%
Loss before income taxes	Loss before income taxes	(13.4)		(2.4)		(36.1)		(2.2)		Loss before income taxes	(5.4)	%	(13.4)	%	(2.4)	%		(3.3)	%	(36.1)	%	(2.2)	%
Income tax benefit	Income tax benefit	(10.3)		(1.8)		(0.6)		(2.1)		Income tax benefit	0.0	%	(10.3)	%	(1.8)	%		—	%	(0.6)	%	(2.1)	%
Net loss	Net loss	(3.1)	%	(0.6)	%	(35.5)	%	—	%	Net loss	(5.4)	%	(3.1)	%	(0.6)	%		(3.3)	%	(35.5)	%	—	%

(1) Presented for improved comparability to pre-COVID-19 operations.

Certain percentage amounts in the table above do not total due to rounding as well as restaurant operating costs being expressed as a percentage of restaurant revenue and not total revenues.

Twelve Weeks Ended Forty Weeks Ended
(Revenues in thousands) October 4, 2020 October 6, 2019 Percent Change October 4, 2020 October 6, 2019 Percent Change
Restaurant revenue $ 197,009 $ 289,862 (32.0) % $ 658,587 $ 992,764 (33.7) %
Franchise royalties, fees and other revenue 3,469 4,360 (20.4) % 9,078 19,305 (53.0) %
Total revenues $ 200,478 $ 294,222 (31.9) % $ 667,665 $ 1,012,069 (34.0) %
Average weekly net sales volumes in Company-owned restaurants $ 39,418 $ 51,221 (23.0) % $ 38,352 $ 51,961 (26.2) %
Total operating weeks 4,998 5,659 (11.7) % 17,172 19,106 (10.1) %
Net sales per square foot $ 75 $ 98 (23.1) % $ 247 $ 334 (26.2) %


	Twelve Weeks Ended						Forty Weeks Ended
(Revenues in thousands)	October 3, 2021		October 4, 2020		Percent Change		October 3, 2021		October 4, 2020		Percent Change
Restaurant revenue	$	270,202	$	197,009	37.2	%	$	861,036	$	658,587	30.7	%
Franchise royalties, fees and other revenue	5,242		3,469		51.1	%	17,658		9,078		94.5	%
Total revenues	$	275,444	$	200,478	37.4	%	$	878,694	$	667,665	31.6	%
Average weekly net sales volumes in Company-owned restaurants	$	52,599	$	39,418	33.4	%	$	50,324	$	38,352	31.2	%
Total operating weeks	5,137		4,998		2.8	%	17,110		17,172		(0.4)	%
Net sales per square foot	$	101	$	75	33.6	%	$	322	$	247	30.4	%

Restaurant revenue for the twelve weeks ended October ~~4, 2020,~~3, 2021, which comprises primarily food and beverage sales, ~~decreased $92.9~~increased $73.2 million, or ~~32.0%~~37.2%, as compared to the ~~third quarter of 2019.~~twelve weeks ended October 4, 2020. The ~~decrease~~increase was due to a ~~$65.7~~$67.0 million, or ~~25.1%~~34.3%, ~~decrease~~increase in comparable restaurant revenue, and a ~~$27.2~~$6.2 million ~~decrease~~increase primarily from reopened restaurants that were temporarily closed ~~restaurants.~~during third quarter 2020. The comparable restaurant revenue ~~decrease~~increase was driven by a ~~24.6% decrease~~22.5% increase in Guest count and a ~~0.5% decrease~~11.8% increase in average Guest check. The ~~decrease~~increase in average Guest check resulted from a ~~3.6% decrease~~3.5% increase in pricing and a 8.4% increase in menu mix, partially offset by a ~~2.2% increase in pricing and a 0.9% increase~~0.1% decrease from ~~lower~~higher discounting. The ~~decrease~~increase in menu mix was primarily driven by ~~limited dining room capacity at reopened restaurants and operating off-premise only at restaurants with temporarily closed dining rooms, resulting in lower~~higher sales of beverages and ~~Finest burgers. Off-premise~~our limited time menu offerings. Off-premises sales ~~increased 127.2% and~~ comprised ~~40.7%~~30.8% of total food and beverage sales during ~~the~~ third quarter of2021, compared to 40.7% in the same period in 2020.

Restaurant revenue for the forty weeks ended October ~~4, 2020, decreased $334.2~~3, 2021, increased $202.4 million or ~~33.7%~~30.7%, as compared to the forty weeks ended October ~~6, 2019.~~4, 2020. The ~~decrease~~increase was due to a ~~$252.1~~$200.6 million, or ~~28.3%~~31.5%, ~~decrease~~increase in comparable restaurant revenue and a ~~$82.1~~$1.8 million ~~decrease~~increase primarily from reopened restaurants that were temporarily closed ~~restaurants.~~during 2020. The comparable restaurant revenue ~~decrease~~increase was driven by a ~~27.4% decrease~~21.1% increase in Guest ~~count~~counts and a ~~0.9% decrease~~10.5% increase in average Guest check. The ~~decrease~~increase in average Guest check resulted from a 3.5% ~~decrease in menu mix, partially offset by a 2.0 %~~ increase in pricing and a ~~0.6 %~~6.6% increase in menu mix, and a 0.4% increase from lower discounting. The ~~decrease~~increase in menu mix was primarily driven by ~~limited dining room capacity at reopened restaurants and operating off-premise only at restaurants with temporarily closed dining rooms, resulting in lower~~higher sales of beverages, appetizers, and ~~Finest burgers. Off-premise sales increased 136.8% and comprised 40.0% of total food and beverage sales during the forty weeks ended October 4, 2020.~~limited time menu offerings.

Average weekly net sales volumes represent the total restaurant revenue for all Company-owned Red Robin restaurants for each time period presented, divided by the number of operating weeks in the period. Comparable restaurant revenues ~~include those~~are comprised of Company-owned restaurants that ~~are in the comparable base at~~have operated five full quarters as of the end of ~~each~~the period presented. ~~The~~Company-owned restaurants that were temporarily closed ~~Company-owned restaurants~~ due to the COVID-19 pandemic were not included in the comparable base for the twelve and forty weeks ended October 3, 2021 or October 4, 2020. Fluctuations in average weekly net sales volumes for Company-owned restaurants reflect the effect of comparable restaurant revenue changes as well as the performance of new and acquired restaurants during the period, ~~and~~ the average square footage of our ~~restaurants.~~restaurants, as well as the impact of changing capacity limitations in response to COVID-19 levels in a given locality. Net sales per square foot represents the total restaurant revenue for Company-owned restaurants included in the comparable base divided by the total ~~adjusted~~ square feet of Company-owned restaurants included in the comparable base.

Franchise and other revenue ~~decreased $0.9~~increased $1.8 million for the twelve weeks ended October ~~4, 2020~~3, 2021 compared to the twelve weeks ended October ~~6, 2019~~4, 2020, due to improved comparable franchise sales performance during the third fiscal quarter of 2021.

Franchise and other revenue increased $8.6 million for the forty weeks ended October 3, 2021 compared to the forty weeks ended October 4, 2020, due to improved comparable franchise sales performance, charging and collecting ~~partial~~ royalty payments and advertising contributions from our franchisees ~~for the majority of~~during the third fiscal quarter of ~~2020. As of~~2021. During 2020, the ~~end of our third fiscal quarter of 2020, we were charging and collecting full~~Company had temporarily abated franchisee royalty ~~payments~~ and advertising ~~contributions from our franchisees. Our franchisees reported a comparable restaurant revenue decrease of 17.0% for the twelve weeks ended October 4, 2020 compared to the same period~~contribution payments in ~~2019.~~

~~Franchise~~mid-March, and other revenue decreased $10.2 million for the forty weeks ended October 4, 2020 compared to the forty weeks ended October 6, 2019 due to the temporary abatement of franchisee royalty payments and advertising contributions in response to COVID-19's effect on our franchise operations throughresumed collection during the latter half of the second fiscal quarter ~~and only charging and collecting partial royalty payments and advertising contributions thereafter through the majority of the third fiscal quarter of 2020. As of the end of the third quarter~~ of 2020, ~~the Company had resumed charging full royalty~~ and ~~advertising contributions to our franchisees. Our franchisees reported a comparable restaurant revenue decrease of 27.1% for the forty weeks ended October 4, 2020 compared to the same period in 2019.~~increased gift card breakage.

Twelve Weeks Ended Forty Weeks Ended
(In thousands, except percentages) October 4, 2020 October 6, 2019 Percent Change October 4, 2020 October 6, 2019 Percent Change
Cost of sales $ 46,037 $ 69,017 (33.3) % $ 155,243 $ 235,119 (34.0) %
As a percent of restaurant revenue 23.4 % 23.8 % (0.4) % 23.6 % 23.7 % (0.1) %


	Twelve Weeks Ended						Forty Weeks Ended
(In thousands, except percentages)	October 3, 2021		October 4, 2020		Percent Change		October 3, 2021		October 4, 2020		Percent Change
Cost of sales	$	62,671	$	46,037	36.1 %		$	193,754	$	155,243	24.8 %
As a percent of restaurant revenue	23.2 %		23.4 %		(0.2)	%	22.5 %		23.6 %		(1.1)	%

Cost of sales, which comprises of food and beverage costs, is variable and generally fluctuates with sales volume. Cost of sales as a percentage of restaurant revenue decreased 4020 basis points for the twelve weeks ended October ~~4, 2020~~3, 2021 as compared to the same period in ~~2019.~~2020. The decrease was primarily driven by pricing, favorable mix shifts, lower ~~promotional discounts~~waste, and ~~net favorable~~higher rebates, partially offset by commodity ~~prices.~~ inflation.

Cost of sales as a percentage of restaurant revenue decreased 10110 basis points for the forty weeks ended October ~~4, 2020~~3, 2021 as compared to the same period in ~~2019.~~2020. The decrease was ~~mainly~~primarily driven by ~~lower promotional discounts, partially offset by increased waste~~pricing, favorable mix shifts, and ~~lower beverage mix.~~rebates.

Twelve Weeks Ended Forty Weeks Ended
(In thousands, except percentages) October 4, 2020 October 6, 2019 Percent Change October 4, 2020 October 6, 2019 Percent Change
Labor $ 74,344 $ 104,870 (29.1) % $ 255,652 $ 354,302 (27.8) %
As a percent of restaurant revenue 37.7 % 36.2 % 1.5 % 38.8 % 35.7 % 3.1 %


	Twelve Weeks Ended						Forty Weeks Ended
(In thousands, except percentages)	October 3, 2021		October 4, 2020		Percent Change		October 3, 2021		October 4, 2020		Percent Change
Labor	$	99,725	$	74,344	34.1 %		$	310,333	$	255,652	21.4 %
As a percent of restaurant revenue	36.9 %		37.7 %		(0.8)	%	36.0 %		38.8 %		(2.8)	%

Labor costs include restaurant-level hourly wages and management salaries as well as related taxes and benefits. For the twelve weeks ended October ~~4, 2020,~~3, 2021, labor as a percentage of restaurant revenue ~~increased 150~~decreased 80 basis points compared to the same period in ~~2019.~~2020. The ~~increase~~decrease was primarily ~~due to sales deleverage and higher hourly wage rates~~ driven by ~~shifting labor mix in support of our off-premise operating model,~~industry staffing shortages and sales leverage, partially offset by ~~lower~~higher wage rates, staffing costs and increased restaurant ~~manager incentive compensation.~~ management compensation costs in 2021.

$3.1 million of transitory labor and other operating costs were incurred due to staffing challenges, including hiring and training costs, temporarily outsourced janitorial costs, one time bonuses, and overtime pay.

For the forty weeks ended October ~~4, 2020,~~3, 2021, labor as a percentage of restaurant revenue ~~increased 310~~decreased 280 basis points compared to the same period in ~~2019.~~2020. The ~~increase~~decrease was primarily driven by staffing shortages, and sales ~~deleverage and higher hourly wage and benefit rates driven by shifting labor mix in support of our off-premise operating model,~~leverage, partially offset by ~~lower~~higher wage rates, staffing costs and increased restaurant ~~manager incentive compensation.~~management compensation costs in 2021.

Other operating costs include costs such as equipment repairs and maintenance costs, restaurant supplies, utilities, restaurant technology, and other miscellaneous costs. For the twelve weeks ended October ~~4, 2020,~~3, 2021, other operating costs as a percentage of restaurant revenue ~~increased 380~~decreased 10 basis points as compared to the same period in ~~2019.~~2020. The ~~increase~~decrease was primarily driven by sales leverage and lower utilities, and lower supplies due to ~~higher third-party delivery fees and supply costs driven by higher off-premise~~lower off-premises sales ~~volumes and sales deleverage impacts on restaurant utility costs,~~mix, partially offset by ~~a decrease in restaurant~~increased hiring advertisement costs and janitorial and maintenance ~~costs.~~ expenses.

For the forty weeks ended October ~~4, 2020,~~3, 2021, other operating costs as a percentage of restaurant revenue ~~increased 450~~decreased 80 basis points as compared to the same period in ~~2019.~~2020. The ~~increase~~decrease was primarily driven by sales leverage and lower utilities and supplies due to ~~higher third-party delivery fees driven by higher off-premise~~lower off-premises sales ~~volumes and sales deleverage impacts on restaurant supply, utility, and technology costs,~~mix, partially offset by ~~a decrease in restaurant maintenance~~increased hiring costs.

Twelve Weeks Ended Forty Weeks Ended
(In thousands, except percentages) October 4, 2020 October 6, 2019 Percent Change October 4, 2020 October 6, 2019 Percent Change
Occupancy $ 22,099 $ 24,942 (11.4) % $ 76,514 $ 85,420 (10.4) %
As a percent of restaurant revenue 11.2 % 8.6 % 2.6 % 11.6 % 8.6 % 3.0 %


	Twelve Weeks Ended						Forty Weeks Ended
(In thousands, except percentages)	October 3, 2021		October 4, 2020		Percent Change		October 3, 2021		October 4, 2020		Percent Change
Occupancy	$	22,519	$	22,099	1.9 %		$	74,233	$	76,514	(3.0)	%
As a percent of restaurant revenue	8.3 %		11.2 %		(2.9)	%	8.6 %		11.6 %		(3.0)	%

Occupancy costs include fixed rents, property taxes, common area maintenance charges, general liability insurance, contingent rents, and other property costs. Occupancy costs incurred prior to opening our new restaurants are included in pre-opening costs. For the twelve weeks ended October ~~4, 2020,~~3, 2021, occupancy costs as a percentage of restaurant revenue ~~increased 260~~decreased 290 basis points compared to the same period in ~~2019~~2020 primarily ~~due to~~driven by sales ~~deleverage.~~ leverage and restructured leases.

For the forty weeks ended October ~~4, 2020,~~3, 2021, occupancy costs as a percentage of restaurant revenue ~~increased~~decreased 300 basis points compared to the same period in ~~2019~~2020 primarily ~~due to~~driven by sales ~~deleverage.~~leverage, savings from permanently closed restaurants and restructured leases.

Our fixed rents for the twelve weeks ended October 3, 2021 and October 4, 2020 were $15.8 million and ~~October 6, 2019 were~~ $14.7 million, ~~and $16.9 million, a decrease~~an increase of ~~$2.2~~$1.1 million due to ~~permanent~~recognizing ongoing fixed rents of Company-owned restaurants that were temporarily closed due to the COVID-19 pandemic in Closed restaurant ~~closures.~~ expense (a component of Other Charges) in 2020, compared to Occupancy in 2021.

Our fixed rents for the forty weeks ended October 3, 2021 and October 4, 2020 were $52.8 million and ~~October 6, 2019 were~~ $51.0 million, ~~and $57.1 million, a decrease~~an increase of ~~$6.1~~$1.8 million due to ~~permanent~~recognizing ongoing fixed rents of Company-owned restaurants that were temporarily closed due to the COVID-19 pandemic in Closed restaurant ~~closures.~~expense (a component of Other Charges) in 2020, compared to Occupancy in 2021, partially offset by a net decrease in store count resulting from 13 locations permanently closed during the period.

Depreciation and Amortization

Twelve Weeks Ended Forty Weeks Ended
(In thousands, except percentages) October 4, 2020 October 6, 2019 Percent Change October 4, 2020 October 6, 2019 Percent Change
Depreciation and amortization $ 19,173 $ 21,280 (9.9) % $ 68,053 $ 71,087 (4.3) %
As a percent of total revenues 9.6 % 7.2 % 2.4 % 10.2 % 7.0 % 3.2 %


	Twelve Weeks Ended						Forty Weeks Ended
(In thousands, except percentages)	October 3, 2021		October 4, 2020		Percent Change		October 3, 2021		October 4, 2020		Percent Change
Depreciation and amortization	$	18,881	$	19,173	(1.5)	%	$	63,984	$	68,053	(6.0)	%
As a percent of total revenues	6.9 %		9.6 %		(2.7)	%	7.3 %		10.2 %		(2.9)	%

Depreciation and amortization includes depreciation on capital expenditures for restaurants and corporate assets as well as amortization of acquired franchise rights, leasehold interests, and certain liquor licenses. For the twelve ~~week periods~~weeks ended October ~~4, 2020,~~3, 2021, depreciation and amortization expense as a percentage of revenue ~~increased 240~~decreased 270 basis points over the same period in ~~2019 primarily due to sales deleverage.~~2020. For the forty weeks ended October ~~4, 2020,~~3, 2021, depreciation and amortization expense as a percentage of revenue ~~increased 320~~decreased 290 basis points over the same period in ~~2019~~2020. The decreases are primarily due to net closed Company-owned restaurants, and sales ~~deleverage.~~leverage.

~~Selling,~~ General, and Administrative expenses

~~Selling, general,~~General, and administrative costs include all corporate and administrative ~~functions.~~functions, excluding Selling expenses discussed below. Components of this category include ~~marketing and advertising costs;~~our restaurant support center, regional, and franchise support salaries and benefits; travel; professional and consulting fees; corporate information systems; legal expenses; office rent; training; and board of directors expenses.

~~Selling, general,~~General, and administrative ~~costs~~expenses in the twelve weeks ended October ~~4, 2020 decreased $15.5~~3, 2021 increased $2.5 million, or ~~42.1%,~~16.5 %, as compared to the same period in ~~2019.~~2020. The ~~decrease~~increase in general and administrative expenses in 2021 was primarily ~~due to decreased national~~driven by merit increases and ~~local media spend, decreased Team Member salaries and wages resulting from the reduction in force and~~lapping temporary salary reductions in 2020, increased travel costs, and decreased Team Member benefits, travel and entertainment, and gift card related costs. For the forty weeks ended October 4, 2020, selling, general, and administrative costs decreased $37.6 million, or 31.3%, as compared to the same period in 2019. The decrease was primarily related to a decrease in national and local media spend, decreased Team Member salaries and wages resulting from the reduction in force and temporary salary reductions, and decreased Team Member benefits, travel and entertainment, gift card related,higher professional services ~~and project related general and administrative costs.~~spend.

General, and administrative expenses in the forty weeks ended October 3, 2021 increased $1.6 million, or 2.9 %, as compared to the same period in 2020. The increase in general and administrative expenses in 2021 was primarily driven by higher Team Member benefit costs, merit increases and lapping temporary salary reductions in 2020, partially offset by decreased travel costs and other corporate costs.


	Twelve Weeks Ended					Forty Weeks Ended
(In thousands, except percentages)	October 3, 2021		October 4, 2020		Percent Change	October 3, 2021		October 4, 2020		Percent Change
Selling expenses	$	12,652	$	6,094	*	$	31,635	$	26,429	19.7 %
As a percent of total revenues	4.6 %		3.0 %		1.6 %	3.6 %		4.0 %		(0.4)	%

Selling expenses include all marketing and advertising costs associated with the Company's marketing strategy.

Selling expenses in the twelve weeks ended October 3, 2021 increased $6.6 million, as compared to the same period in 2020. The increase in selling expenses in 2021 was primarily driven by the return of marketing spend closer to a more normalized level in 2021.

Selling expenses in the forty weeks ended October 3, 2021 increased $5.2 million, or 19.7 %, as compared to the same period in 2020. The increase in selling expenses in 2021 was primarily driven by the return of marketing spend closer to a more normalized level in 2021.

* Percentage increases and decreases over 100 percent were not considered meaningful.

Pre-opening Costs


	Twelve Weeks Ended						Forty Weeks Ended
(In thousands, except percentages)	October 3, 2021		October 4, 2020			Percent Change	October 3, 2021		October 4, 2020			Percent Change
Pre-opening costs	$	418	$	89		*	$	792	$	245		*
As a percent of total revenues	0.2 %		—		%	0.2 %	0.1 %		—		%	0.1 %

Twelve Weeks Ended Forty Weeks Ended
(In thousands, except percentages) October 4, 2020 October 6, 2019 Percent Change October 4, 2020 October 6, 2019 Percent Change
Pre-opening costs $ 89 $ — — % $ 245 $ 319 (23.2) %
As a percent of total revenues — % — % — % — % — % — %
* Percentage increases and decreases over 100 percent were not considered meaningful.

Pre-opening costs, which are expensed as incurred, comprise the costs related to preparing restaurants to introduce Donatos® ~~and other initiatives,~~, as well as direct costs, including labor, occupancy, training, and marketing, incurred related to opening new restaurants and hiring the initial work force. Our pre-opening costs fluctuate from period to period, depending upon, but not limited to, the number of restaurants where Donatos® has been introduced, the number of restaurant openings, the size of the restaurants being opened, and the location of the restaurants. Pre-opening costs for any given quarter will typically include expenses associated with restaurants opened during the quarter as well as expenses related to restaurants opening in subsequent quarters.

We incurred pre-opening costs during the twelve and forty weeks ended October 3, 2021 and October 4, 2020 related to the rollout of Donatos®. The ~~limited~~Company completed the rollout of 38 restaurants during the twelve weeks ended October 3, 2021, and expects to continue its roll out of Donatos® ~~planned~~to approximately 40 restaurants in the ~~Seattle market during 2020 was completed on October 16, 2020. The Company expects to resume its phased system-wide rollout~~fourth quarter of ~~Donatos® in~~fiscal year 2021.

Interest Expense, Net and Other

Interest expense, net and other was ~~$2.3~~$2.9 million for the twelve weeks ended October ~~4, 2020,~~3, 2021, an increase of ~~$0.5~~$0.6 million, or ~~27.8%~~26.1%, compared to the same period in ~~2019.~~2020. The increase was primarily related to a higher weighted average interest rate for the quarter due to increased rates associated with the Second Amendment, partially offset by a lower average outstanding debt balance compared to the same period in ~~2019.~~2020. Our weighted average interest rate was ~~5.0%~~6.8% for the twelve weeks ended October ~~4, 2020 as compared to 5.1% for the same period in 2019.~~

Interest expense, net and other was $7.6 million for the forty weeks ended October 4, 2020, an increase of $0.4 million, or 5.6%, compared to the same period in 2019. The increase was primarily related to a higher average outstanding debt balance partially offset by a lower weighted average interest rate compared to the same period in 2019. Our weighted average interest rate was 4.5% for the forty weeks ended October 4, 20203, 2021 as compared to 5.0% for the same period in ~~2019.~~2020.

Interest expense, net and other was $10.0 million for the forty weeks ended October 3, 2021, an increase of $2.4 million, or 31.6%, from the same period in 2020. The increase was primarily related to a higher weighted average interest rate for the period as well as the partial write off of approximately $1.2 million of deferred financing charges related to the modification of our revolver in conjunction with the execution of the Second Amendment on February 25, 2021, partially offset by a lower average outstanding debt balance compared to the same period in 2020. Our weighted average interest rate was 6.6% for the forty weeks ended October 3, 2021 as compared to 4.5% for the same period in 2020.

Provision for Income Taxes

The effective tax rate for the twelve weeks ended October ~~4, 2020~~3, 2021 was a ~~77.0%~~0.2% benefit, compared to a 74.1% benefit for the twelve weeks ended October 6, 2019. The effective tax rate for the forty weeks ended October 4, 2020 was a 1.8% benefit, compared to a 99.1% benefit for the same period in 2019. The increase in tax77.0% benefit for the twelve weeks ended October 4, ~~2020 is primarily due to a decrease in income and the release of $12.7 million in a previously recognized valuation allowance.~~2020. The ~~decrease in~~effective tax benefit for the forty weeks ended October 3, 2021 was 1.1%, compared to a 1.8% benefit for the forty weeks ended October 4, ~~2020~~2020. The decrease in tax benefit for the twelve and forty weeks ended October 3, 2021 is primarily due to ~~a $67.1 million net~~the change in full valuation allowance recognition.

The Company has filed federal and ~~decrease in current year~~state cash tax ~~credits, partially offset by a decrease in income and the favorable rate impact of~~refund claims totaling approximately $16 million during 2021 from net operating loss ~~("NOL") carrybacks allowed as part~~carrybacks. While we expect to receive a portion of the ~~CARES Act. Subsequent~~refunds in 2021, due to ~~its third quarter balance sheet date, the Company received $49.4 million~~government delays in ~~cash tax refunds, including interest, and expects~~processing these claims we do not expect to receive ~~between $12 million to $15 million of additional cash tax refunds within~~ the ~~next 12 months.~~

majority until 2022.

Liquidity and Capital Resources

Cash and cash equivalents ~~decreased $2.7~~increased $1.6 million to ~~$27.4~~$17.8 million atas of October ~~4, 2020,~~3, 2021, from ~~$30.0~~$16.1 million at the beginning of the fiscal year. As the Company ~~has now stabilized its liquidity through its at-the-market equity offering, reduced overhead costs,~~continues to recover from the COVID-19 pandemic and ~~federal~~generates operating cash ~~tax refunds provided under~~flow, the ~~provisions of the CARES Act, we expect to begin~~Company is using available cash flow from operations to pay down debt, maintain existing restaurants and infrastructure, and execute on ~~our~~its long-term strategic initiatives. As of October ~~4, 2020,~~3, 2021, the Company had approximately ~~$97~~$75.2 million in liquidity, including the impact of a $30 million capacity reduction on our revolving line of credit pursuant to the Second Amendment, including cash on hand and available borrowing capacity under its credit facility. Our liquidity as of October 4, 2020 does not include $49.4 million in cash tax refunds, including interest, which were received after the third quarter balance sheet date.capacity.

The table below summarizes our cash flows from operating, investing, and financing activities for each period presented (in thousands):

Operating Cash Flows

Net cash flows provided by (used in) ~~provided by~~ operating activities ~~decreased $64.0~~increased $61.0 million to ~~$22.4~~$37.6 million for the forty weeks ended October ~~4, 2020.~~3, 2021. The changes in net cash provided by (used in) ~~provided by~~ operating activities are primarily attributable to a ~~$110.4~~$103.3 million ~~decrease~~increase in profit from operations (defined as the change in operating margins from comparable and non-comparable restaurants), lower accounts receivable and higher accounts payable balances due to the timing of operational receipts and payments, as well as other changes in working capital as presented in the ~~condensed consolidated statements~~Condensed Consolidated Statements of ~~cash flows.~~Cash Flows.

Investing Cash Flows

Net cash flows used in investing activities ~~decreased $18.8~~increased $5.8 million to ~~$14.1~~$20.0 million for the forty weeks ended October ~~4, 2020,~~3, 2021, as compared to ~~$32.9~~$14.1 million for the same period in ~~2019.~~2020. The ~~decrease~~increase is primarily due to ~~decreased investment~~increased spend on Donatos® associated with adding 38 restaurants in ~~restaurant technology, restaurant maintenance, and new restaurants and restaurant refreshes due to~~ the ~~COVID-19 pandemic.~~third fiscal quarter.

The following table lists the components of our capital expenditures, net of currency translation, ~~effect,~~ for the forty weeks ended October ~~4, 2020~~3, 2021 and October ~~6, 2019~~4, 2020 (in thousands):

Financing Cash Flows

Net cash flows ~~provided by (used in)~~used in financing activities increased ~~$41.2~~$51.0 million to ~~$34.0~~$16.0 million for the forty weeks ended October ~~4, 2020,~~3, 2021, as compared to net cash flows provided by financing activities of $34.0 million in the same period in ~~2019.~~2020. The ~~increase~~decrease is due to ~~cash~~a $28.9 million decrease in proceeds ~~received~~ from the issuance of common stock, net of ~~cash paid for stock~~ issuance costs, ~~of $28.9 million,~~and a ~~$14.4~~$24.7 million increase in net ~~draws~~repayments made on long-term debt, partially offset by a decrease in cash used for debt issuance costs, and a decrease in cash used to repurchase the Company's common stock due to the temporary suspension of the Company's share repurchase program. The increase was partially offset by an increase of cash used for debt issuance costs. The net cash proceeds from issuance of common stock of $28.9 million do not include unpaid stock issuance costs of approximately $0.2 million.

~~Table of Contents~~

program beginning in 2020.

As of October ~~4, 2020,~~3, 2021, the Company had outstanding borrowings under the ~~credit facility~~Credit Facility of ~~$215.2~~$156.3 million, of which $9.7 million was classified as current, in addition to amounts issued under letters of credit of ~~$7.9~~$8.6 million. Amounts issued under letters of credit reduce the amount available under the ~~credit facility~~Credit Facility but are not recorded as debt. As of October ~~4, 2020,~~3, 2021, the Company had ~~$69.6~~$57.4 million of available borrowing capacity under its Credit Facility, including the impact of a $30 million capacity reduction on our revolving line of credit ~~facility.~~pursuant to the Second Amendment. Net ~~draws~~payments during the ~~third quarter of 2020~~forty weeks ended October 3, 2021 totaled ~~$8.6~~$14.3 million, and net draws during the ~~forty weeks ended October 4,~~same period in 2020 totaled $9.2 million. We have made net repayments on our Credit Facility of $50.5 million since December 29, 2019.

As discussed in Footnote6, Borrowings, in the Notes to the Condensed Consolidated Financial Statements in Part I, Item 1 of this Quarterly Report on Form 10-Q, In response to the continued uncertainty around the impact of industry labor and supply chain challenges, as well as the COVID-19 Delta variant, the Company amended its current Credit Facility on November 9, 2021 to obtain additional flexibility to continue to implement our business strategy. The Company anticipates refinancing its Credit Facility in 2022.

We are subject to a number of customary covenants under our ~~credit facility,~~Credit Facility, including limitations on additional borrowings, acquisitions, stock repurchases, sales of assets, and dividend payments. ~~During~~As discussed in Footnote6, Borrowings, in the ~~first quarter of 2020, we were not in compliance with our debt covenants due~~Notes to the ~~negative effects~~Condensed Consolidated Financial Statements in Part I, Item 1 of this Quarterly Report on ~~our business from the COVID-19 pandemic. As a result,~~Form 10-Q, we entered into the Third Amendment ~~to our credit facility,~~on November 9, 2021, which waives compliance with the ~~lease adjusted leverage ratio financial covenant ("LALR ratio") and fixed charge coverage ratio financial covenant ("FCC ratio")~~Leverage Ratio Covenant for the ~~remainder~~third fiscal quarter of ~~fiscal 2020~~2021, and ~~allows~~provides for adjustments during fourth fiscal quarter of 2021, and the first, ~~three~~second, and third fiscal quarters of ~~2021~~2022. Additionally, the Third Amendment provides for adjustments to the ~~LALR ratio, including increasing~~calculation of the ~~maximum LALR ratio permitted and allowing the use of a seasonally adjusted annualized consolidated EBITDA~~FCCR Covenant when it becomes applicable in the ~~LALR ratio calculation,~~first fiscal quarter of 2022. See Footnote 6, Borrowings for additional details.

As of October 3, 2021, the Company is in compliance with all applicable covenants applicable to our Credit Facility, as amended. Due to an anticipated delay in the timing of receipt of cash tax refunds, during the third fiscal quarter and in addition to the ~~FCC ratio, including only being calculated~~Third Amendment, the Company obtained a waiver from our lenders, waiving the application of our FCCR Covenant for ~~applicable periods since~~ the ~~beginning~~third and fourth fiscal quarters of 2021.

Total debt outstanding ~~increased $9.2~~decreased $13.4 million to ~~$216.1~~$157.2 million at October ~~4, 2020~~3, 2021, from ~~$206.9~~$170.6 million at December ~~29, 2019,~~27, 2020, primarily due to net ~~draws~~payments of ~~$9.2~~$14.3 million on the ~~credit facility~~Credit Facility, offset by accruing utilization fees on the Credit Facility during the forty weeks ended October ~~4, 2020~~3, 2021. ~~In conjunction with the receipt~~

We typically maintain current liabilities in excess of our current assets which results in a working capital deficit. We are able to operate with a working capital deficit because restaurant sales are primarily conducted on a cash or credit card basis. Rapid turnover of inventory results in limited investment in inventories, and cash from sales is usually received before related payables for food, supplies, and payroll become due. In addition, receipts from the sale of gift cards are received well in advance of related redemptions. Rather than maintain higher cash balances that would result from this pattern of operating cash flows, we typically utilize operating cash flows in excess of those required for currently-maturing liabilities to pay for capital expenditures, debt repayment, or to repurchase stock as allowed. When necessary, we utilize our ~~credit facility~~Credit Facility to satisfy short-term liquidity requirements. We believe our future cash flows generated from restaurant operations combined with our remaining borrowing capacity under the ~~credit facility~~Credit Facility will be sufficient to satisfy any working capital deficits and our planned capital expenditures.

On August 9, 2018, the Company's board of directors authorized the Company's current share repurchase program of up to a total of $75 million of the Company's common stock. The share repurchase authorization was effective as of August 9, 2018, and will terminate upon completing repurchases of $75 million of common stock unless otherwise terminated by the board. Pursuant to the repurchase program, purchases may be made from time to time at the Company's discretion and the Company is not obligated to acquire any particular amount of common stock. From the date of the current program approval through October ~~4, 2020,~~3, 2021, we have repurchased a total of 226,500 shares at an average price of $29.14 per share for an aggregate amount of $6.6 million. Accordingly, as of October ~~4, 2020,~~3, 2021, we had $68.4 million of availability under the current share repurchase program.

Effective March 14, 2020, the Company temporarily suspended its share repurchase program to provide additional liquidity during the COVID-19 pandemic. Our ability to repurchase shares is limited to conditions set forth by our lenders in the ~~amendment~~Second Amendment to our ~~credit facility~~Credit Facility prohibiting us from repurchasing additional shares until the ~~later~~first fiscal quarter of ~~(a)~~2022 at the ~~Company's delivery of~~earliest and not until we deliver a covenant compliance certificate ~~for the fiscal quarter ending on~~demonstrating a lease adjusted leverage ratio less than or about July 11, 2021 demonstrating compliance with the financial covenants then in effect or (b) the Company satisfying an agreed ratio under its Leverage Ratio Covenant for the most recently ended fiscal quarter or fiscal year, as applicable.

~~Table of Contents~~

equal to 5.00:1.00.

The primary inflationary factors affecting our operations are food, labor costs, energy costs, and materials used in the construction of new restaurants. A large number of our restaurant personnel are paid at rates based on the applicable minimum wage, and increases in the minimum wage rates have directly affected our labor costs in recent years. Many of our leases require us to pay taxes, maintenance, repairs, insurance, and utilities, all of which are generally subject to inflationary increases. Labor cost inflation had a negative impact on our financial condition and results of operations during the forty weeks ended October 4, 2020. Uncertainties related to fluctuations in costs, including energy costs, commodity prices, annual indexed or potential minimum wage increases, and construction materials make it difficult to predict what impact, if any, inflation may continue to have on our business, but it is anticipated inflation will have a negative impact on labor and commodity costs for the remainder of ~~2020.~~2021.

Our business is subject to seasonal fluctuations. ~~Historically,~~Prior to the COVID-19 pandemic, sales in most of our restaurants have been higher during the summer months and winter holiday season and lower during the fall season. As a result, our quarterly operating results and comparable restaurant revenue may fluctuate significantly as a result of seasonality. Accordingly, results for any one quarter are not necessarily indicative of results to be expected for any other quarter, and comparable restaurant sales for any particular future period may decrease.

Contractual Obligations

There were no other material changes outside the ordinary course of business to our contractual obligations since the filing of Company's Quarterly Report on Form 10-Q for the fiscal quarter ended April ~~19, 2020,~~18, 2021, except for lease obligations as a result of contractual rent concessions negotiated by the Company during the fiscal ~~quarters~~quarter ended ~~July 12, 2020 and~~ October ~~4, 2020.~~3, 2021. See the maturity of lease liabilities table in Note 4, 3, Leases,, in the Notes to the Condensed Consolidated Financial Statements in Part I, Item 1 of this Quarterly Report on Form 10-Q.

Critical Accounting Policies and Estimates

Critical accounting policies and estimates are those we believe are both significant and that require us to make difficult, subjective, or complex judgments, often because we need to estimate the effect of inherently uncertain matters. We base our estimates and judgments on historical experiences and various other factors we believe to be appropriate under the circumstances. Actual results may differ from these estimates, including our estimates of future restaurant level cash flows, which are subject to the current economic environment and future impact from the COVID-19 pandemic, and we might obtain different results if we use different assumptions or conditions. We had no significant changes in our critical accounting policies and estimates which were disclosed in our Annual Report on Form 10-K for the fiscal year ended December ~~29, 2019.~~27, 2020.

Recently Issued and Recently Adopted Accounting Standards

See Note 1, Basis of Presentation and Recent Accounting Pronouncements, of Notes to Condensed Consolidated Financial Statements in Part I, Item 1 of this Quarterly Report on Form 10-Q.


Delaware						84-1573084
(State or other jurisdiction of incorporation or organization)						(I.R.S. Employer Identification No.)


		Page
PART I - FINANCIAL INFORMATION
Item 1.	Financial Statements (unaudited)	1
	Condensed Consolidated Balance Sheets	1
	Condensed Consolidated Statements of Operations and Comprehensive Loss	2
	Condensed Consolidated Statements of Stockholders' Equity	3
	Condensed Consolidated Statements of Cash Flows	5
	Notes to Condensed Consolidated Financial Statements	6
Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	1413
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	2726
Item 4.	Controls and Procedures	2726
PART II - OTHER INFORMATION
Item 1.	Legal Proceedings	2827
Item 1A.	Risk Factors	2827
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	2927
Item 6.	Exhibits	3028
	Signature	29


		October 4, 2020		December 29, 2019			October 3, 2021		December 27, 2020
Unearned gift card revenue	Unearned gift card revenue	$	31,514	$	43,544	Unearned gift card revenue	$	29,599	$	38,309
Deferred loyalty revenue	Deferred loyalty revenue	$	11,050	$	10,679	Deferred loyalty revenue	$	13,022	$	11,829


		Twelve Weeks Ended				Forty Weeks Ended					Twelve Weeks Ended				Forty Weeks Ended
		October 4, 2020		October 6, 2019		October 4, 2020		October 6, 2019			October 3, 2021		October 4, 2020		October 3, 2021		October 4, 2020
Operating lease cost	Operating lease cost	$	14,992	$	17,298	$	51,931	$	58,412	Operating lease cost	$	16,061	$	14,992	$	53,765	$	51,931
Finance lease cost:	Finance lease cost:									Finance lease cost:
Amortization of right of use assets	Amortization of right of use assets	227		193		615		634		Amortization of right of use assets	197		227		657		615
Interest on lease liabilities	Interest on lease liabilities	150		122		412		416		Interest on lease liabilities	131		150		407		412
Total finance lease cost	Total finance lease cost	$	377	$	315	$	1,027	$	1,050	Total finance lease cost	328		$	377	$	1,064	$	1,027
Variable lease cost	Variable lease cost	5,902		6,653		19,207		22,185		Variable lease cost	4,496		5,902		15,271		19,207
Total	Total	$	21,271	$	24,266	$	72,165	$	81,647	Total	$	20,885	$	21,271	$	70,100	$	72,165


☒						QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934


☐						TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934


	(Unaudited)
(in thousands, except for share amounts)	October 4, 2020		December 29, 2019
Assets:
Current assets:
Cash and cash equivalents	$	27,367	$	30,045
Accounts receivable, net	9,024		22,372
Inventories	24,496		26,424
Income tax receivable	63,066		5,308
Prepaid expenses and other current assets	11,652		21,338
Total current assets	135,605		105,487
Property and equipment, net	446,083		518,013
Right of use assets, net	415,948		426,248
Goodwill	0		96,397
Intangible assets, net	25,440		29,975
Other assets, net	10,195		61,460
Total assets	$	1,033,271	$	1,237,580
Liabilities and stockholders' equity:
Current liabilities:
Accounts payable	$	18,940	$	33,040
Accrued payroll and payroll-related liabilities	26,878		35,221
Unearned revenue	42,564		54,223
Current portion of lease obligations	62,032		42,699
Current portion of long-term debt	9,692		0
Accrued liabilities and other	42,987		29,403
Total current liabilities	203,093		194,586
Long-term debt	206,375		206,875
Long-term portion of lease obligations	450,751		465,435
Other non-current liabilities	19,858		10,164
Total liabilities	880,077		877,060
Stockholders' equity:
Common stock; $0.001 par value: 45,000 shares authorized; 20,449 and 17,851 shares issued; 15,548 and 12,923 shares outstanding as of October 4, 2020 and December 29, 2019	20		18
Preferred stock, $0.001 par value: 3,000 shares authorized; 0 shares issued and outstanding as of October 4, 2020 and December 29, 2019	0		0
Treasury stock 4,901 and 4,928 shares, at cost, as of October 4, 2020 and December 29, 2019	(199,908)		(202,313)
Paid-in capital	242,048		213,922
Accumulated other comprehensive loss, net of tax	(5,494)		(4,373)
Retained earnings	116,528		353,266
Total stockholders' equity	153,194		360,520
Total liabilities and stockholders' equity	$	1,033,271	$	1,237,580


	October 4, 2020						December 29, 2019
	Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount		Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount
Intangible assets subject to amortization:
Franchise rights	$	50,584	$	(36,813)	$	13,771	$	53,336	$	(35,896)	$	17,440
Leasehold interests	13,001		(9,155)		3,846		13,001		(8,794)		4,207
Liquor licenses and other	9,961		(9,598)		363		10,737		(9,869)		868
	$	73,546	$	(55,566)	$	17,980	$	77,074	$	(54,559)	$	22,515
Indefinite-lived intangible assets:
Liquor licenses and other	$	7,460	$	—	$	7,460	$	7,460	$	—	$	7,460
Intangible assets, net	$	81,006	$	(55,566)	$	25,440	$	84,534	$	(54,559)	$	29,975


	Period Ended(2)
Reopened Company-owned Restaurant Indoor Dining Rooms	9-Aug	6-Sept	4-Oct	1-Nov(3)
Net comparable restaurant revenues	(29.1)%	(20.1)%	(9.5)%	(13.7)%
Average weekly net sales per restaurant	$38,779	$41,272	$43,034	$42,778
# of comparable Company-owned restaurants(1)	340	347	381	362


Exhibit Number						Description

(10.1)						Third Amendment to Credit Agreement, dated as of November 9, 2021, by and among Red Robin International, Inc., Red Robin Gourmet Burgers, Inc., the Guarantors, the Lenders party thereto and Wells Fargo Bank, National Association, as administration agent. Incorporated by reference to Exhibit 10.1 to our Current Report on Form 8-K filed on November 10, 2021.

31.1						Rule 13a-14(a) Certification of Chief Executive Officer

31.2						Rule 13a-14(a) Certification of Chief Financial Officer

32.1						Section 1350 Certifications of Chief Executive Officer and Chief Financial Officer

101						The following financial information from the Quarterly Report on Form 10-Q of Red Robin Gourmet Burgers, Inc. for the quarter ended October ~~4, 2020~~3, 2021 formatted in XBRL (eXtensible Business Reporting Language): (i) Condensed Consolidated Balance Sheets at October ~~4, 2020~~3, 2021 and December ~~29, 2019;~~27, 2020; (ii) Condensed Consolidated Statements of Operations and Comprehensive Loss for the twelve and forty weeks ended October ~~4, 2020~~3, 2021 and October ~~6, 2019;~~4, 2020; (iii) Condensed Consolidated Statements of Stockholders' Equity at October ~~4, 2020~~3, 2021 and October ~~6, 2019;~~4, 2020; (iv) Condensed Consolidated Statements of Cash Flows for the forty weeks ended October ~~4, 2020~~3, 2021 and October ~~6, 2019;~~4, 2020; and (v) the Notes to Condensed Consolidated Financial Statements, tagged as blocks of text.