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Item 1. Business

2023-02-28 compared with 2022-03-10 · 177 added, 185 removed, 167 unchanged (68% of the section changed)

Red Robin Gourmet Burgers, Inc., together with its subsidiaries, primarily operates, franchises, and develops casual dining restaurants in North America famous for serving more than two dozen craveable, high-quality burgers with Bottomless Steak Fries® in a fun environment welcoming to Guests of all ages.

Red Robin Gourmet Burgers, Inc., together with its subsidiaries, primarily operates, franchises, and develops casual dining restaurants in North America famous for serving more than two dozen craveable, high-quality burgers with Bottomless Steak Fries® and sides in a fun environment welcoming to Guests of all ages.

We opened the first Red Robin® restaurant in Seattle, Washington in September 1969.

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2020 December 27, 2020 52

Upcoming Fiscal Year:

Upcoming Fiscal Years:

2023 December 31, 2023 53

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Business Strategy

Our long-term business strategy was developed using Guest and Team Member insights to align our efforts with our unique brand position in the industry.

Our Guests are every-day people seeking connection with friends and family across a diverse, and multi-generational demographic with a large majority falling into the Gen X, Millennial, and Centennial generations.

We believe our broad demographic appeal and distinct Red Robin brand equities position us well for future growth.

While the COVID-19 pandemic brought forth complex challenges, it also enabled us to intensely focus on improving our operating and financial model.

The material improvements made to our business will enable us to execute our business strategy in an even stronger position.

Our business strategy focuses on the following pillars;

Be the Employer of Choice in the Industry .

We champion a culture of diversity and inclusion where our people are developed, recognized and celebrated – and can always “come as they are.” We empower the people who make Red Robin possible and offer a compelling Team Member value proposition.

Deliver a Variety of Gourmet Burgers and Mainstream Favorites that Guests Love .

We offer a wide variety of gourmet burgers, with a creative take on traditional.

We understand our Guests’ preferences and provide high-quality burgers with sustainable alternatives, including the Impossible TM burger and our Veggie burger.

offer other mainstream favorites, like shareable pizza, wings, milkshakes, and beer.

We continue to focus on meaningful menu innovation that is compelling to Guests and easy for our Operations teams to execute.

• Guest Experience:

Create Relevant, Personalized and Memorable Guest Experiences .

We leverage our Total Guest Experience ("TGX") hospitality model to deliver fun and playful service that is tailored and customized to our Guests’ time and occasion, while delivering exceptional value through our commitment to bottomless steak fries ® and drinks.

We employ both off-premises and restaurant technology enhancements to present our Guest with a seamless and frictionless experience.

• Foundation:

Execute Profitable Growth Platforms .

Essential to our business model and related capital allocation, we have developed several platforms designed to drive consistent and profitable growth.

We are continuing to invest in these platforms that include our digital ecosystem and Donatos®, and support growing multiple channels of business including dine-in, off-premises and catering.

We are also in the early stages of reestablishing our new restaurant development program.

The Red Robin vision is to be the restaurant brand that our communities trust most…YUMMM®!

The Company recently released its North Star five-point plan designed to enhance the Company's competitive positioning.

The North Star five-point plan consists of the following:

• Transform to an Operations Focused Restaurant Company:

◦ Empower decision making by operators at the unit level

◦ Incentivize and reward operators to drive business growth and results

◦ Restructured support organization

• Elevate the Guest Experience:

◦ Invest in people, food quality, and the restaurant facility

◦ New cooking platform to fully deliver on our commitment of Gourmet Burgers

◦ Menu refresh adding variety of both offerings and price points

• Remove Costs and Complexity:

◦ Optimize the supply chain to reduce costs and ensure consistent delivery of high-quality product

◦ Evaluate vendors for need, performance, and competitive costs

◦ Implement ongoing process to reduce costs through actions that uphold our commitment to a great Guest experience

• Optimize Guest Engagement:

◦ Engage and support local communities in which we operate

◦ Enhance the off-premises experience

◦ Further build and engage Guests through Red Robin Royalty® loyalty program

• Drive Growth in Comparable Restaurant Revenue & Unit Level Profitability, and Deliver Financial Commitments:

◦ Regain credibility with the investment community

◦ Drive performance in the existing base of restaurants, earning the right to resume new unit growth

◦ Deliver financial guidance commitments

The Red Robin vision is to be the most loved restaurant brand in the communities we serve.

Restaurant Concept

The Red Robin brand has many desirable attributes, including a range of high-quality menu items, a strong Guest-focused culture, and a strong value proposition, where our Guests experience memorable moments of connection with family, friends, and fun.

With our menu of Gourmet Burgers and American favorites, attractive atmosphere, and playful environment that connects friends and family, our brand not only carries great memories for our most loyal Guests but also appeals to a broad demographic.

Our Guests seek connection with friends and family across a diverse and multi-generational demographic.

We pride ourselves on our Gourmet Burgers and other mainstream favorites served in a casual, playful atmosphere.

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In addition to burgers, which accounted for 61% of food sales in 2022, Red Robin serves an array of other mainstream favorites that appeal to our Guests.

These items include a variety of shareable foods like Donatos® pizza, wings, salads, other entrees, and desserts.

These items include a variety of foods like Donatos® pizza, wings, salads, other entrees, and desserts.

We also offer a range of single-serve and shareable desserts as well as our milkshakes.

Our beverages include signature alcoholic and non-alcoholic specialty drinks, cocktails, wine, and a variety of national and craft beers.

We strive to give our Guests the choice of the pace of their experience based on their occasion, from accommodating time-pressured meals to offering a place to relax and connect with family and friends.

Red Robin also has an extraordinary approach to Guest service, and we have cataloged thousands of stories of Red Robin Team Members who live our values.

We strive to customize the pace of the experience for our Guests based on their occasion, from accommodating time-pressured meals to offering a place to relax and connect with family and friends.

We call this the “gift of time.” Red Robin also has an extraordinary approach to Guest service, and we have cataloged thousands of stories of Red Robin Team Members who live our values.

Many examples can be found on our website, www.redrobin.com.

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We also strive to provide our Guests with exceptional dining value and the ability to customize their experience.

In 2021, we had an average check per Guest of $14.46 including beverages.

Average Guest check increased compared to 2020 when the COVID-19 pandemic restricted indoor dining resulting in a higher off-premise sales mix.

In 2022, we had an average check per Guest of $15.99.

Average Guest check increased 10.5% compared to 2021.

We believe our price-to-value relationship, featuring our innovative array of quality burgers, served with bottomless fries, differentiates us from our casual dining competitors and allows us to appeal to a broad base of middle income, multi-generational consumers.

Ongoing Commitment to Sustainability

Red Robin's Better for Being Here mentality represents our commitment as the Company matures its approach to sustainability.

Red Robin is a company that cares;

we have always strived to make the world a better place for our Team Members, our community, and our planet.

we strive to make the world a better place for our Team Members, our community, and our planet.

We are beginning to undertake a more formal and robust sustainability journey with meaningful goals and a commitment to align with the industry and are informed by experts including the Sustainability Accounting Standards Board (the "SASB").

We will continue to adapt our sustainability approach integrated with our North Star strategic priorities.

In 2022, we published our first sustainability report, which is available on our website at ir.redrobin.com.

The contents of the sustainability report and our website are not incorporated by reference into this Form 10-K.

Human Capital Management

We strive to ensure our employees, whom we refer to as Team Members, are Better for Being Here through our core B.U.R.G.E.R values:

Bottomless Fun, Unwavering Integrity, Relentless Focus on Improvement, Genuine Spirit of Service, Extraordinary People, and Recognized Burger Authority.

Each of these values work to empower and develop our Team

Members and has created a Company culture that we collectively take pride in every day.

We reward and incentivize our Team Members with competitive pay, recognition and rewards, and benefit programs.

We also provide our Team Members the opportunity to grow and develop, promote health and safety, and value inclusion, diversity, and engagement.

We strive to ensure our people, who we refer to as Team Members, live out and benefit from our core values:

Integrity, Fun, Unbridled Hospitality, and High Performance.

We believe that when we live out these values, we win together!

Winning together is our core objective.

We nurture this culture by ensuring that our people are front and center, that they have a clear understanding of what is expected, and that people love working for our brand.

We strive to provide our people with a great place to work, opportunities for growth, and competitive compensation for their contributions.

Our values empower and motivate our Team Members and create a Company culture that we collectively take pride in every day.

We also provide

our Team Members the opportunity to grow and develop, promote health and safety, and value inclusion, diversity, and engagement.

As part of our human capital management strategy, we focus on the following areas:

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Competitive Compensation and Benefits

We support our Team Members by offering market-competitive wages and benefits for eligible Team Members.

We pay competitive, prevailing wages, and our only positions paid below minimum wage at the restaurant level are our tipped Team Members who are paid at the state tip credit rate or state minimum wage rate.

All other positions are paid at or above minimum wage, and we ensure tipped positions make more than minimum wage when including tips.

Our benefits programs include medical and other insurance, employee assistance programs, shift meals, Red Robin meal discounts, paid time off, 401(k) with employer match, an employee stock purchase plan, and equity-based awards for eligible restaurant support center and operations Team Members, generally, at the director level and above.

Our compensation and performance evaluation systems are carefully designed to maintain pay equity by focusing pay decisions on experience and performance to ensure the Company retains a highly productive workforce to operate our business while providing a high level of service to our Guests.

We support our Team Members by offering market-competitive compensation and benefits for eligible Team Members.

Tip eligible Team Members are paid at least the tip credit rate or minimum wage rate as mandated by federal, state, or local government agencies, in addition to receiving customer tips.

We aim to ensure tipped positions make more than the federal, state, or local minimum wage when including tips.

Our benefit programs include medical, dental, and vision insurance offerings, employee assistance programs, shift meals, Red Robin meal discounts, paid time off, 401(k) with employer match, an employee stock purchase plan, and equity-based awards for eligible Restaurant Support Center and operations Team Members, generally, at the director level and above.

Our compensation and performance evaluation systems are designed to compensate our Team Members fairly for their level of experience, team effort, and overall contribution to our business.

We leverage our rewards to motivate our Team Members to do what is necessary in our mission to deliver a best-in-class Guest experience.

For our field operations leaders we anticipate implementing a new performance-based manager compensation program.

Our individual restaurant managers and multi-restaurant operators, are now referred to as "Managing Partners" and "Market Partners," respectively.

Under our new 2023 plan we expect each Partner will earn a base salary plus a performance bonus, which represents a percentage of each of their respective restaurant’s operating profit.

We expect to change our legacy program because we believe that providing each Partner with a significant stake in our business will attract and retain the best talent in the industry.

We also believe that this program rewards our Partners for making the right day-to-day decisions to satisfy our Guests and meet our financial objectives.

Health and Safety

We operate with the health, safety, and well-being of Red Robin's Team Members, Guests, and communities in mind, as well as federal, state and local regulatory requirements.

We have traditionally been a leader in health and safety and have implemented new practices during the COVID-19 pandemic consistent with that leadership position.

In response to the COVID-19 pandemic, we have provided personal protective equipment for our restaurant Team Members.

We also provided COVID-19 testing coverage for our restaurant Team Members through our benefit plans before it was required.

During the COVID-19 pandemic, we immediately instituted telecommuting policies at the restaurant support center to support working from home.

As a result of the success of that approach, we have implemented a dispersed workforce policy that permits many of our Restaurant Support Center Team Members to continue working remotely and we expect that to continue on a go-forward basis.

For on-site critical, Company leadership, and those who desire to work in a shared location, we have optimized our office footprint to meet the needs of that population.

Diversity, Equity, and Inclusion

At Red Robin, we value diversity and inclusion.

We have a successful Women's Excellence program, a Company-wide resource group to support and inspire Team Members through development, networking, leadership, and other resources while fueling a culture of opportunity and diversity, and we continue to partner with the Women's Foodservice Forum, which has been instrumental in providing valuable resources and insights to help the advancement of our female leaders.

We are progressing with an initiative with the assistance of a diversity consultant to identify areas of opportunity for expanded diversity and inclusion practices in our Company and to support the development and execution of a comprehensive long-term diversity, equity, and inclusion strategy for Red Robin.

In late 2021, Directors and above in Operations and Restaurant Support Center leadership positions completed unconscious bias training.

We intend to provide similar training to our restaurant General Managers in 2022.

During the COVID-19 pandemic, we took additional measures to protect our Team Members and Guests from infectious disease as well as comply with state and local protocols designed to maintain a healthy work environment.

Diversity, Equity, and Inclusion ("DE&I")

At Red Robin, our Guests and Team Members reflect the communities we serve and can always come as they are.

We champion a culture of inclusion, diversity of thought, perspective and experience, all vital ingredients of a winning recipe.

In 2022, we established a 10-member Diversity, Equity, and Inclusion Council to develop a long-term strategy and plan for our Company.

This group meets on a monthly basis to assess opportunities for the Company to improve its efforts to create a best-in-class work environment that thrives on inclusion and diversity of thought.

This Council meets with our Executive Team and Board of Directors on a periodic basis to provide recommendations and updates on our progress against our evolving DE&I objectives.

Restaurant Management

Our typical restaurant management team consists of a general manager, an assistant general manager, one to two associate managers, and additional shift supervisors depending on restaurant sales volumes.

With our restaurant management restructuring completed in 2020, we have been able to fluctuate supervision needs more easily to better adjust to sales volumes in our restaurants.

This improves our ability to manage effectively by placing more management and supervision in the restaurants during peak times.

In 2021, we accelerated hiring of associate managers to reflect improving sales volumes, and to support operationally challenged restaurants.

Our restaurant management restructuring also expanded our talent pipeline with additional capacity for entry-level restaurant managers.

This provides a structured and clear career path for our Team Members and allows us to broaden our external candidate pool beyond individuals with full service dining experience.

From 2020 through 2022, our typical restaurant management team consisted of a General Manager, an assistant General Manager, one to two associate managers, and additional shift supervisors depending on restaurant sales volumes.

We believe it is critical to operate our restaurants with a full complement of experienced, professional, and salaried restaurant management.

Beginning in 2023, we anticipate changing the typical restaurant management team to consist of a Managing Partner, an assistant General Manager, a kitchen manager, and associate managers or shift supervisors as appropriate dependent primarily on restaurant Sales volume.

We expect this transition in restaurant management will occur in phases.

This transition marks a major change in our operational approach for the future.

Expectations for local restaurant leadership will be to “own” all aspects of the profit and loss of the restaurant.

Decision making on a number of P&L related activities will now be driven by local leadership with the support of multi-unit field operations leaders when appropriate.

In support of this approach the compensation plan for field restaurant leaders will change significantly.

A larger portion of the total compensation package for Managing Partners will be in the form of a monthly bonus linked to restaurant-level operating profit.

Leaders who are effective

at driving higher levels of monthly operating profit will receive higher monetary rewards.

This model also supports our intent to improve our level of community focus within the local regions we serve.

Managing Partners will have the flexibility and resources to drive localized activities aimed at nurturing relationships within the community to drive Guest traffic.

It is our expectation that this approach will help to drive both top and bottom-line results.

The management team of each restaurant is responsible for the day-to-day operation of that restaurant, including hiring, training, and coaching of Team Members, as well as operating results.

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Our Company remains committed to offering Team Members numerous opportunities to have their voices heard because we believe our Team Members are our most valuable resource.

In late 2021, we began exploring the need to update and enhance our Team Member value proposition.

This includes a multi-channel discovery process where we have sought feedback from prior Team Members as well as current Team Members in our restaurants and the Restaurant Support Center.

Conducted through a variety of survey and interview techniques, we have developed a growing body of data to inform the evolution of our Team Member value proposition.

In late 2022, we partnered with an outside vendor to launch a new Team Member engagement survey across our enterprise.

Launch is set for mid-2023.

We plan to use this information to gather insights from our Team Member population and identify opportunities to better meet their needs.

We plan to offer the use of this survey tool multiple times during the year to gain feedback when key events occur, so we can quickly respond to suggestions and concerns when they arise.

We believe that such a tool will not only assist us with workforce retention, but also enhance labor productivity over time.

Food Safety and Purchasing

Our food safety and quality assurance programs help manage our commitment to quality ingredients and food preparation.

Our systems are designed to protect our food supply from product receipt through preparation and service.

Our food safety and quality assurance programs help manage our commitment to safe, quality ingredients and responsible food preparation and service.

Our Food Safety Management Program is a set of systems designed to protect from risk and control hazards.

We provide detailed specifications for our proprietary food ingredients, products, and supplies to our suppliers.

We qualify and audit on an annual basis all of our food and beverage suppliers, as well as growers.

We qualify and require outside third party certification audits on an annual basis for all of our food and beverage suppliers, as well as growers.

Their certifications must comply with the Global Food Safety Initiative, if applicable.

Our restaurant managers are certified in a comprehensive safety and sanitation course by the National Restaurant Association's ServSafe program.

Our restaurant leaders must pass and maintain an accredited manager-level food safety and sanitation certification.

Strict food safety protocols, including safe cooking temperature requirements, food handling procedures, cooling procedures, and frequent temperature and quality checks, ensure the safety and quality of the food we serve in our restaurants.

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The restaurant management team inspects deliveries to ensure that the products received meet our safety and quality specifications.

Additionally, we engage an independent auditing company to perform unannounced comprehensive food safety and sanitation inspections up to four times a year in all Company-owned and franchised restaurants.

Additionally, we engage an independent auditing company to perform unannounced comprehensive food safety and sanitation assessments at least three times a year in all Company-owned and franchised restaurants.

If an assessment identifies any gaps, a documented plan is required for any deficiency noted.

This same follow-up requirement is in place for government regulatory inspections.

To maximize our purchasing efficiencies and obtain the best possible prices for our high-quality ingredients, products, and supplies, our centralized purchasing team negotiates supply agreements that may include fixed price contracts that can vary in term or formula-based pricing agreements that can fluctuate on changes in raw material commodity pricing.

Of our total cost of goods in 2021, ground beef represented approximately 16%, potatoes represented approximately 12%, and poultry represented approximately 11%.

Of our total cost of goods in 2022, ground beef represented approximately 15%, poultry represented approximately 12%, and potatoes represented

approximately 11%.

We monitor the market for the primary commodities we purchase and extend contract positions when applicable in order to minimize the impact of fluctuations in price and availability.

However, certain commodities, primarily cheese, bacon and ground beef, have historically been subject to market price fluctuations.

As a result of the COVID-19 pandemic, we have experienced and expect to continue to experience distribution disruptions, commodity cost inflation, and certain food and supply shortages.

During the COVID-19 pandemic, we experienced distribution disruptions, commodity cost inflation, and certain food and supply shortages.

To manage this risk in part, we enter into fixed-price purchase commitments for certain commodities;

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Restaurant Development, Remodels, and Donatos®

In 2020, Red Robin reestablished a new restaurant development program as part of its long-term growth strategy which includes opportunities to execute sustainable growth initiatives that deliver value to our stockholders.

We have made considerable progress establishing the foundation of our program during the pandemic, including refining our new restaurant prototype design, identifying target markets to prudently add new restaurants and reengaging our broker network to assist in identifying new restaurant sites.

Target markets were selected based on brand affinity, operational and financial performance, marketing efficiency, availability of incremental sites, and expected financial returns.

Specific site selection criteria is focused on identifying markets, trade areas, and specific sites that are likely to yield the greatest density of desirable demographic characteristics, retail traffic, and visibility.

In the fourth quarter of 2021, we opened one corporate restaurant in a high volume market.

This restaurant utilizes our new prototype configuration with design enhancements to improve dine in, off-premises, and curbside execution, and an optimized kitchen layout that enhances efficiency.

The Company is expecting to pursue modest new restaurant growth based on an ongoing track record of successful restaurant openings that meet our financial criteria, beginning in 2023.

During the pandemic, we suspended restaurant refreshes and remodels at our existing locations.

Starting in 2022, we are resuming this program to keep our restaurants relevant and well-maintained.

In 2020, Red Robin reestablished a new restaurant development program as part of its long-term growth strategy.

With the transition to a new leadership team in 2022, we have deprioritized new restaurant growth as we focus on other business initiatives and uses of capital.

In 2022, we resumed our restaurant refresh and remodel program to keep our restaurants relevant and well-maintained.

We continue to believe this type of investment presents an opportunity to provide compelling investment returns.

We are conducting a thorough review and evaluation of all completed refreshes and remodels to gather learnings and measure consumer response.

When complete, we expect this evaluation will inform our go forward design criteria, investment level, and pace of refreshes and remodels.

In 2020, we announced our partnership with Donatos®, a high-quality pizza brand "nested" inside of Red Robin restaurants.

Through this partnership, our restaurants will prepare and serve Donatos® branded pizzas to our dine in and off-premises Guests.

Pursuant to a licensing arrangement, we will pay royalties on sales of Donatos® pizza products to Donatos®.

Through this partnership, our restaurants prepare and serve Donatos® branded pizzas to our dine-in and off-premises Guests.

Pursuant to a licensing arrangement, we pay royalties on sales of Donatos® pizza products to Donatos®.

As of December 25, 2022, we have introduced Donatos® pizzas to 245 restaurants.

We plan to introduce Donatos® to approximately 50 restaurants in 2022 and expect to complete our rollout to approximately 400 Company-owned restaurants during 2023.

We plan to continue implementation of Donatos® to additional restaurants in 2023 and anticipate eventually operating Donatos® in substantially all Red Robin restaurants.

We invested $6.1 million and $17.1 million in the Donatos® expansion in fiscal 2022 and 2021, respectively.

Comparable restaurant revenue growth in fiscal 2022 compared to fiscal 2021 at restaurants with Donatos® outperformed restaurants without Donatos® by 470 basis points.

Restaurant Franchise and Licensing Arrangements

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Our two largest franchisees own 41 restaurants located in Eastern and Central Pennsylvania, Michigan and Ohio.

We anticipate that our franchisees will open one new restaurant in 2022.

Franchise Compliance Assurance

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We also exchange best operating practices with our franchisees as we strive to improve our operating systems while attaining a high level of franchisee participation.

Digital Ecosystem

During 2021, the Company has significantly advanced its digital strategy by completing a number of enhancements which together create an integrated and seamless digital ecosystem for our Guests.

In the fourth quarter of 2021, we launched mobile applications on both iOS and Android platforms.

These applications are designed to generate higher order conversion compared to the legacy online experience, and offer superior suggested upsell capabilities on top of a more convenient user experience.

During the fourth quarter of 2021, we also introduced improved and more relevant digital experiences to drive incremental frequency from existing Guests, new Guest traffic and Guest checks.

These improvements include the launch of a new and improved website, and the integration of a new loyalty platform, giving us new segmentation capabilities to connect with our Guests more meaningfully, through personalized messaging based on their purchase history.

This has allowed us to maintain high levels of engagement with the over 10 million members of our Red Robin Royalty program.

These enhancements of our digital Guest experiences were "soft-launched" in the fourth quarter of 2021, and will receive marketing support in early 2022 to drive awareness and trials of the new applications and website ordering experience.

These enhancements are iterative, and we expect to continue making ongoing innovations and improvements to Red Robin's digital ecosystem following the initial launch for years to come.

Information Technology

We rely on information systems in all aspects of our operations, including, but not limited to, point-of-sale transaction processing in our restaurants, digital experiences, operation of our restaurants, labor management, management of our inventories, collection of cash, payment of payroll and other obligations, and various other processes and procedures.

Our restaurant support center and Company-owned restaurants are enabled with information technology and decision support systems.

In our restaurants, these systems are designed to provide operational tools for sales, inventory, and labor management.

This technology includes industry-specific, off-the-shelf systems such as tools designed to optimize food, beverage, and labor costs.

These systems are integrated with our point-of-sale systems to provide daily, weekly, and period-to-date reporting that is important for Managers to run an efficient and high-performing restaurant.

We also use technology to interact with our Guests via our digital ecosystem, inclusive of our website, mobile Apps, loyalty platform, online ordering site, and Guest feedback systems, which provide actionable insights on Guest service, food quality, and atmosphere of each restaurant.

Information Systems and Digital Technology

We rely on information systems and digital technology in all aspects of our operations, striving to create seamless Guest experiences and enable Operations to deliver on our Brand commitments.

In our restaurants, these technologies are designed to facilitate operational efficiency and support the Guest experience.

These technologies include (but are not limited to) labor management systems, sales and forecasting tools, inventory management, and operational execution solutions.

These technologies are integrated with our point-of-sale system to provide daily, weekly, and period-to-date reporting that is important for our Operators to run an efficient and high-performing restaurant.

We also use technology to interact with our Guests via our digital platforms, including our website, mobile Apps, loyalty platform, online ordering site, table top kiosks, Server handhelds, and Guest feedback systems, which provide actionable insights on the overall Guest experience.

We utilize centralized financial, accounting, and human resource management systems to support our Restaurant Support Center and Company-owned restaurants.

In addition, we use an operations scorecard that integrates data from our centralized systems and distributes information to assist in managing our restaurants.

We believe these combined tools are important in analyzing and improving our operations, profit margins, and other results.

In 2020, we invested in infrastructure that modernized and upgraded the capacity of our restaurant systems, stabilized the hand-held point-of-sale devices system wide to prepare for the launch of our new Total Guest Experience service model, and continued work on new, Guest facing digital experiences that support in-restaurant and off-premise dining.

In 2021, we implemented the first phase of our digital transformation which included a new and improved ordering site, custom mobile Apps (iOS and Android), and a new integrated Loyalty Platform.

We plan to continue our investments in building innovative digital experiences for our Guests and to improve our ability to manage our technology infrastructure through investments in infrastructure, automation, and advanced monitoring through a Cloud first approach.

In addition, we use an Operations scorecard that integrates data from our centralized systems and distributes information to assist in managing the performance of our restaurants.

We believe these combined tools are important in analyzing and improving our operations, profit margins, and monitoring other key business metrics.

In 2021, we significantly upgraded our digital capabilities implementing the first phase of our digital transformation which included a new and improved ordering site, custom mobile Apps (iOS and Android), and a new integrated Loyalty

Platform specifically designed to connect with our Guests in a more meaningful and personalized way.

Digital enhancements and loyalty improvements continue to be an iterative effort and we expect to continue to implement ongoing enhancements that benefit our Guests and Team Members.

In 2023 and 2024, we expect to begin infrastructure modernization efforts to improve performance and stability of current and future technology solutions.

We accept electronic payment cards from our Guests for payment in our restaurants.

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We have systems and processes in place that focus on the protection of our Guests' credit card information and other private information we are required to protect, such as our Team Members' personal information.

We have taken a number of steps to prevent the occurrence of security breaches in this respect.

Our systems have been carefully designed and configured to protect against data loss or compromise.

We have taken several steps to prevent the occurrence of security breaches in this respect.

Our systems are carefully designed and configured to protect against data loss or compromise.

For example, because of the number of credit card transactions processed in our Company-owned restaurants, Red Robin is required to maintain compliance per the Payment Card Industry Data Security Standard (PCI-DSS) for our networks and systems both at our Restaurant Support Center and Company-owned restaurants.

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Marketing and Advertising

We build brand equity and awareness through a media strategy with tailored content by channel and target.

We leverage digital media (including search, website, digital display, over-the-top, online video, and social media), email, SMS, and public relations initiatives.

We build brand equity and awareness through a marketing mix inclusive of paid, owned and earned media.

We leverage social media, SEM, SEO, online reputation and social community management, email, SMS, website and public relations initiatives.

These programs are funded primarily through cooperative creative development and national media advertising funds.

In addition, we supplement national media with targeted local media across offline and online channels.

Beginning in 2023, we expect to reallocate national paid media marketing activities to emphasize Guest engagement through local restaurant marketing in communities in which we operate and improve the dine-in experience.

In recent years, we have undertaken significant market research initiatives to gain a deep understanding of our Guests, our brand promise, and what we must do to deliver that promise.

Additionally, we gain feedback and perceptions in order to inform our business decisions.

Among other things, we use a Guest satisfaction tool in all restaurants that provides feedback from Guests on their experiences.

We use a Guest satisfaction tool in all restaurants that provides feedback from Guests on their experiences.

Restaurant managers use this information to help identify areas of focus to strengthen restaurant performance and track progress.

We also continually monitor our performance relative to peers and test potential business drivers among both current and potential Guests.

We leverage our over ten million member Red Robin Royalty TM database to gain insights and track the frequency and purchase behavior of our Guests.

Our "All the Fulls" brand campaign, highlights our craveable food, distinctive positioning and emotional connection with Guests.

We will also continue marketing support for our growing off-premise business which includes carryout, catering, and delivery.

In 2021, we have maintained our focus on digital marketing, which has proven effective in reaching our core Guests where and how they consume media, in the most cost effective way.

This digital marketing strategy has led to increased Guest engagement with our brand.

We leverage our over eleven million member Red Robin Royalty TM database to gain insights and track the frequency and purchase behavior of our Guests.

Our brand creative and messaging highlights our craveable food, distinctive positioning, dine-in experience and emotional connection with Guests.

We will also continue marketing support for our off-premises business which includes carryout, catering, and delivery.

Executive Officers

The following table sets forth information about our executive officers:

The following table sets forth information about our current executive officers:

Name Age Position

Paul Murphy 67 President, Chief Executive Officer, and Member of the Board of Directors

Jonathan Muhtar 50 Executive Vice President and Chief Concept Officer

Schweinfurth 54 Executive Vice President, Chief Financial Officer, and Interim Chief Accounting Officer

Michael Buchmeier 58 Senior Vice President and Chief Operating Officer

Kaplan 53 Executive Vice President and Chief Legal Officer

Darla Morse 59 Executive Vice President and Chief Information Officer

Wayne Davis 59 Senior Vice President and Chief People Officer

Murphy joined Red Robin as President and Chief Executive Officer in October 2019.

Before joining Red Robin, Mr.

Murphy served as Executive Chairman of Noodles & Company from July 2017 to September 2019.

Prior to that, Mr.

Murphy served as CEO and a member of the board of directors of Del Taco Restaurants, Inc.

from February 2009 to July 2017 and as President from February 2009 to December 2016.

Hart 65 President, Chief Executive Officer, and Member of the Board of Directors

Todd Wilson 45 Chief Financial Officer

Sarah Mussetter 44 Chief Legal Officer and Secretary

Wayne Davis 60 Chief People Officer

Hart joined Red Robin as President and Chief Executive Officer in September 2022.

Hart served as a director of the Company since August 2019.

Hart most recently served as Chief Executive Officer of Torchy’s Tacos from 2018 until 2021.

He was previously the Executive Chairman and Chief Executive Officer of California Pizza Kitchen from 2011 to 2018.

From 2000 to 2011, Mr.

Murphy held various roles with Einstein Noah Restaurant Group, Inc.

Murphy originally joined Einstein's as Senior Vice President, Operations in 1997.

He was promoted to Executive Vice President, Operations in 1998, and to Chief Operating Officer in 2002.

In 2003, he was appointed President and CEO and a member of the board of directors.

Murphy has significant experience in both operational and executive leadership in the restaurant industry, including leading companies through successful business transformations.

Jonathan Muhtar .

Muhtar was promoted to Executive Vice President and Chief Concept Officer of the Company, effective January 1, 2018.

Muhtar previously served the Company as Senior Vice President and Chief Marketing Officer from December 2015 until his promotion.

Prior to joining the Company, Mr.

Muhtar served as Executive Vice President and Chief Marketing Officer of Captain D's Seafood Restaurant from November 2011 to December 2015, and as Vice President of Global Marketing and Innovation and in other corporate and marketing positions at Burger King Corporation from July 2004 to June 2011.

Schweinfurth.

Schweinfurth joined Red Robin as Executive Vice President and Chief Financial Officer in January 2019.

She is also currently serving as our interim Chief Accounting Officer beginning in February 2022.

Schweinfurth previously served as Vice President, Chief Financial Officer and Treasurer of Fiesta Restaurant Group since 2012 and was appointed Senior Vice President of Fiesta Restaurant Group in February 2015.

From 2010 to 2012, she served as Vice President of Finance and Treasurer of Winn-Dixie Stores, Inc.

Schweinfurth was Chief Financial Officer of Lone Star Steakhouse and Texas Land & Cattle from 2009 to 2010.

She was Vice President, Finance, at Brinker International, Inc.

from 2004 to 2009.

Prior to 2004, Ms.

Schweinfurth served in various corporate finance positions at Yum Brands, Inc.

and PepsiCo, Inc.

Michael Buchmeier .

Buchmeier serves as Red Robin's Senior Vice President and Chief Operating Officer since November 2021, and previously served as our Senior Vice President and Chief People Officer since August 2019, and as the Company's interim Chief Operating Officer, beginning January 2020.

Prior to his appointment to the Senior Vice President and Chief People Officer position, Mr.

Buchmeier served as the Company's interim Chief People Officer from April 2019 to August 2020.

He previously served in restaurant operations and various leadership roles for the Company from April 2018 to April 2019, including Vice President, Operations Standards and Talent Optimization from August 2018 to April 2019, Vice President of Operations from January 2018 to August 2018, Vice President, Operations Excellence from October 2016 to January 2018, and Director, New Restaurant Operations from August 2012 to October 2016.

Kaplan joined Red Robin as Senior Vice President, Chief Legal Officer, and Secretary in October 2013 and was promoted to Executive Vice President and Chief Legal Officer in February 2020.

Prior to joining the Company, he served as Senior Vice President, General Counsel, Chief Security Officer and Corporate Secretary of DAE Aviation Holdings, Inc.

(d/b/a Standard Aero), a privately held global aviation maintenance company, from January 2010 to September 2013, and as a Shareholder at Greenberg Traurig, LLP, an international law firm, from January 2002 to January 2010.

Morse joined Red Robin as Executive Vice President and Chief Information Officer in March 2021.

Prior to joining the Company, she served as Chief Information Officer at CKE Restaurants Holdings from April 2019 to April 2021, Chief Information Officer at Inspire Brands from April 2016 to April 2019, and Chief Information Officer at Seaworld from April 2010 to April 2016.

Davis joined Red Robin as Senior Vice President and Chief People Officer in November 2021.

Prior to joining the Company he served as Senior Vice President of International Human Resources at Comcast from June 2009 to January 2021, and Vice President of Human Resources at YRC Worldwide from June 2005 to June 2009.

Hart served as President of Texas Roadhouse Holdings, LLC and as Chief Executive Officer and member of the board from 2004 to 2011.

Hart also held leadership positions at Al Copeland Investments, TriFoods International, New Zealand Lamb Company, and Shenandoah Valley Poultry earlier in his career.

Wilson joined Red Robin as Chief Financial Officer in November 2022.

Wilson most recently served as Chief Financial Officer at Hopdoddy Burger Bar and Hibar Hospitality from 2018 until 2022.

Prior to that, he was Vice President of Finance for Jamba Juice from 2016 until 2018.

From 2011 to 2016, Mr.

Wilson served as Division CFO and Vice President of Finance at Bloomin’ Brands.

Sarah Mussetter.

Mussetter joined the Company as Chief Legal Officer and Secretary in December 2022.

She previously held the roles of Associate General Counsel and Vice President, Deputy General Counsel for the Company from 2011 to 2021.

Prior to joining the Company Ms.

Mussetter worked for the law firm of Holme Roberts & Owen LLP (now Bryan Cave Leighton Paisner LLP).

Most recently, Ms.

Mussetter was SVP Deputy General Counsel for Skillsoft Corp., a learning application and technology company based in Denver, from September 2021 to December 2022.

Davis joined Red Robin as Chief People Officer in November 2021.

Prior to joining the Company he served as Senior Vice President of Human Resources at Comcast/NBC Universal from June 2009 to January 2021, and Vice President of Human Resources at YRC Worldwide from June 2005 to June 2009.

The restaurant industry is highly competitive, and our Guests may choose to purchase food at supermarkets or other food retailers.

Although, for some occasions, we compete against other segments of the restaurant industry, including quick-service and fast-casual restaurants, our primary competition is with other sit-down, casual dining restaurants within the full service dining segment.

In addition, we compete to attract Guests for off-premise dining occasions, including online ordering, delivery, to-go, and catering.

In addition, we compete to attract Guests for off-premises dining occasions, including online ordering, delivery, to-go, and catering.

The number, size, and strength of competitors vary by region, concept, market, and even restaurant.

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Our business is subject to seasonal fluctuations.

Prior to the onset of the COVID-19 pandemic, sales in most of our restaurants have been higher during the summer months and winter holiday season due to factors including our retail-oriented locations and family appeal.

As a result, our quarterly operating results and comparable restaurant sales may fluctuate significantly as a result of seasonality.

Sales in most of our restaurants are typically higher during the summer months and winter holiday season due to factors including our retail-oriented locations and family appeal.

As a result, our quarterly operating results may fluctuate significantly as a result of seasonality.

Accordingly, results for any one quarter or year are not necessarily indicative of results to be expected for any other quarter or for any year, and comparable restaurant sales for any particular future period may vary.

We have a number of registered trademarks and service marks, including the Red Robin®, Red Robin Gourmet Burgers®, "YUMMM®", Red Robin Gourmet Burgers and Brews®, and Red Robin Royalty® and logos.

We have registered for these marks, among others, with the United States Patent and Trademark Office, and we have applied to register various trademarks in certain other international jurisdictions.

We have a number of registered trademarks and service marks, including the Red Robin®, Red Robin Gourmet Burgers®, "YUMMM®", Red Robin Gourmet Burgers + Brews®, and Red Robin Royalty® and logos.

We have registered these marks, among others, with the United States Patent and Trademark Office, and we have registered various trademarks in certain other international jurisdictions.

Pursuant to our licensing arrangement with Donatos®, we license the right to use the Donatos® trademark.

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Government Regulation

In response to the COVID-19 pandemic, federal, state, and local governments have issued and revised a significant amount of regulations affecting our business, with requirements often changing without much advance notice.

Regulations relating to the vaccination and COVID-19 testing of Guests and Team Members, Guest spacing within dining rooms and other social distancing practices, sanitation practices, isolation and quarantine periods for Team Members, paid sick leave, and mask mandates for Guests and Team Members have materially affected the way we operate our business and serve our Guests.

Over the last few years, in response to the COVID-19 pandemic, federal, state, and local governments have issued and revised a significant amount of regulations affecting our business, with requirements often changing without much advance notice.

Regulations relating to the vaccination and COVID-19 testing of Guests and Team Members, Guest spacing within dining rooms and other social distancing practices, sanitation practices, isolation and quarantine periods for Team Members, paid sick leave, and mask mandates for Guests and Team Members materially affected the way we operate our business and serve our Guests.

We are also subject to laws and regulations relating to the preparation and sale of food, including regulations regarding product safety, nutritional content, and menu labeling.

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The development and construction of new restaurants is also subject to compliance with applicable zoning, land use, and environmental regulations.

We are also subject to certain guidelines under the Americans with Disabilities Act of 1990 and various state codes and regulations, which require restaurants and our brand to provide full and equal access to persons with physical disabilities.

We are also subject to certain guidelines under the Americans with Disabilities Act of 1990

and various state codes and regulations, which require restaurants and our brand to provide full and equal access to persons with physical disabilities.

We are also subject to federal regulation and state laws that regulate the offer and sale of franchises and substantive aspects of the franchisor-franchisee relationship.

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(ii) our expectations about pricing strategy and average check size;

(iii) our expectations of the competitiveness of the labor market and our ability to hire, train, and retain Team Members;

(iv) anticipated capital investments including in our digital ecosystem, information technology systems, our restaurant development program, and the anticipated related benefits;

(iii) our expectations of the competitiveness of the labor market and our ability to hire, train, and retain Team Members, including the success of our Managing Partner and Market Partner program and Team Member engagement efforts;

(iv) anticipated capital investments and the results of such investments including in our restaurant refresh and remodel program and our digital ecosystem, information technology systems, our restaurant development program, and the anticipated related benefits;

(v) our expectations about restaurant operating costs, including commodity and food prices and labor and energy costs;

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and (x) our expectations regarding demand and business recovery, consumer preferences, and consumer discretionary spending;

(xi) our expectations regarding the implementation and anticipated benefits of our diversity and inclusion initiatives;

(xii) anticipated impacts of COVID-19, measures we have and may continue to take in response to the COVID-19 pandemic including remote working arrangements, and any pandemic mitigation measures imposed by governments;

(xiii) the seasonality of our business;

(xiv) our expectations and other statements regarding interest rates, commodity prices and the other risks discussed under Risk Factors below.

(xi) our expectations regarding the implementation and anticipated benefits of our ESG, diversity, equity and inclusion and other initiatives;

(xii) our ability to successfully implement our food safety programs, (xii) our ability to successfully implement our health and safety initiatives;

(xiii) anticipated impacts of COVID-19;

(xiv) the seasonality of our business;

(xv) our ability to successfully implement, and our expectations regarding, our North Star five-point plan to enhance the Company’s competitive positioning;

(xvi) our expectations and other statements regarding interest rates, commodity prices and other factors;

(xvii) the expected impacts of government regulations on our operations and financial condition, and changes in such regulation;

(xviii) the implementation of our restaurant management transition program, including anticipated benefits to our Guest traffic, community focus and results of operations;

and (xviv) the other risks discussed under Risk Factors below.

Although we believe the expectations reflected in our forward-looking statements are based on reasonable assumptions, such expectations may prove to be materially incorrect due to known and unknown risks and uncertainties.

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In addition, the factors described under Risk Factors, as well as other possible factors not listed, could cause actual results to differ materially from those expressed in forward-looking statements, including, without limitation, the following:

• the effectiveness of the Company's strategic initiatives, including our North Star plan, labor models, service, and operational improvement initiatives;

• general economic conditions, including changes in consumer disposable income, weather conditions, and related events in regions where our restaurants are operated;

• the impact of COVID-19 on our results of operations, supply chain, and liquidity;

• the effectiveness of the Company's strategic initiatives, including alternative labor models, service, and operational improvement initiatives;

• the effectiveness of the Company’s programs and policies, including with respect to food safety and Team Member health and safety;

• our ability to staff, train, and retain our workforce for service execution;

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• menu changes, including the anticipated sales growth, costs, and timing of the Donatos® expansion;

• the implementation, rollout, and timing of technology solutions in our restaurants and at our restaurant support center, in addition to digital platforms that are accessed by our Guests;

• our ability to achieve revenue and cost savings from off-premise sales and other initiatives;

• the implementation, rollout, and timing of initiatives, improvements and technology solutions in our restaurants and at our Restaurant Support Center, in addition to digital platforms that are accessed by our Guests;

• the implementation of and realization of benefits from our restaurant management transition program;

• our ability to achieve revenue and cost savings from off-premises sales and other initiatives;

• competition in the casual dining market and discounting by competitors;

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• changes in the cost and availability of key food products, distribution, labor, and energy;

• general economic conditions, including changes in consumer disposable income, weather conditions, and related events in regions where our restaurants are operated;

• the adequacy of cash flows and the cost and availability of capital or credit facility borrowings;

• the adequacy of cash flows and the cost and availability of capital or Credit Facility borrowings and our potential sale-leaseback transactions;

• the impact of federal, state, and local regulation of the Company's business;

• the impact of federal, state, and local COVID-19 regulation or requirements, including capacity restrictions;

• changes in federal, state, or local laws and regulations affecting the operation of our restaurants, including minimum wages, consumer health and safety, health insurance coverage, nutritional disclosures, and employment eligibility-related documentation requirements;

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

What changed 10-K

Item 1. Business