What changed in this filing

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Item 8. Financial Statements and Supplementary Data

2026-02-25 compared with 2025-02-26 · 392 added, 357 removed, 593 unchanged (56% of the section changed)

3 unchanged sentences

Consolidated Balance Sheets

Consolidated Statements of Operations and Comprehensive Loss

Consolidated Statements of Operations and Comprehensive Income ( Loss )

Consolidated Statements of Stockholders' Equity (Deficit)

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The Company assesses long-lived assets for impairment at the individual restaurant level whenever events and circumstances indicate the carrying amount of an asset group may not be recoverable.

Expected cash flows associated with an asset are the key factor in determining the recoverability of the asset.

Identifiable cash flows are measured at the restaurant level.

Expected future cash flows associated with an asset are the key factor in determining the recoverability of the asset.

The estimate of cash flows is based upon, among other things, certain assumptions about expected future operating performance, including assumptions of future revenue trends.

If the sum of the cash flows is less than the carrying value of the asset, an impairment loss is recognized and measured as the amount by which the carrying value exceeds the fair value of the asset.

We identified the evaluation of long-lived asset impairment as a critical audit matter because of the significant judgments made by management to estimate the cash flows, including assumptions about expected future operating performance, and the fair value of the lease assets.

This required a significant degree of auditor judgment and an increased extent of effort, when performing audit procedures to evaluate whether management appropriately identified and evaluated potential impairment indicators, and when evaluating the reasonableness of management’s estimates and assumptions, particularly related to cash flows and market rent.

We identified the evaluation of long-lived asset impairment as a critical audit matter because of the significant judgments made by management to estimate future cash flows, including assumptions about expected future operating performance, and the fair value of the lease assets.

How the Critical Audit Matter Was Addressed in the Audit

Our audit procedures related to the impairment of long-lived assets included the following, among others:

• We tested the design and operating effectiveness of internal controls over the Company’s assessment and evaluation of potential impairment indicators for long-lived assets and over forecasted cash flows and market rent used in their recoverability and impairment analyses.

• We tested the design and operating effectiveness of internal controls over the Company’s assessment and evaluation of potential impairment indicators for long-lived assets and over forecasted cash flows, discount rates, and market rents used in their recoverability and impairment analyses.

• We evaluated the reasonableness of the Company’s evaluation of impairment indicators by:

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• We evaluated the reasonableness of the information in the Company’s forecasted cash flows used in their recoverability and impairment analyses, by comparing the forecasts to:

◦ Historical actual information,

◦ Historical actual results.

◦ Internal communications between management and the Board of Directors.

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• We evaluated the Company’s forecasted cash flows for consistency with evidence obtained in other areas of the audit.

• With the assistance of our fair value specialists, we evaluated the market rent by developing a range of independent estimates and comparing those to the market rent used by management.

• With the assistance of our fair value specialists, we evaluated the market rents and discount rates provided to management by Stout, a third party specialist, by developing a range of independent estimates and comparing those to the market rent and discount rate used by management.

/s/ Deloitte & Touche LLP

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Total assets $ 563,527 $ 641,314

Liabilities and stockholders' equity:

Liabilities and stockholders' equity (deficit):

Current liabilities:

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Accrued liabilities and other 46,801 42,931

42,931 46,201

Total current liabilities $ 198,629 $ 189,552

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Commitments and contingencies (see Note 12.)

Commitments and Contingencies)

Stockholders' equity (deficit):

Common stock;

$ 0.001 par value:

Common stock, $ 0.001 par value:

45,000 shares authorized;

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no shares issued and outstanding as of December 28, 2025 and December 29, 2024

Treasury stock 4,647 and 4,921 shares, at cost as of December 29, 2024 and December 31, 2023

Treasury stock:

4,041 and 4,647 shares, at cost as of December 28, 2025 and December 29, 2024

( 143,247 ) ( 164,937 )

Paid-in capital 213,180 233,667

Accumulated other comprehensive loss, net of tax ( 62 ) ( 22 )

Accumulated deficit ( 152,959 ) ( 75,418 )

Accumulated other comprehensive income (loss), net of tax ( 60 ) ( 62 )

Retained earnings (accumulated deficit) ( 176,243 ) ( 152,959 )

Total stockholders' equity (deficit)

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RED ROBIN GOURMET BURGERS, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)

(In thousands, except per share amounts)

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Depreciation and amortization 51,120 57,729 66,190

Selling, general, and administrative expenses (includes $ 6,940 , $ 6,329 , and $ 8,635 of stock-based compensation)

General and administrative (includes $ 5,573 , $ 6,940 , and $ 6,329 of stock-based compensation)

76,254 81,721 89,360

Selling 31,328 36,719 34,770

Pre-opening costs — — 587

Impairment and other charges (gains), net

Other (gains) charges, net (includes $( 4,104 ), $ 71 , and $ 128 of stock-based compensation)

10,463 33,848 ( 2,663 )

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Income (loss) from operations $ 2,790 $ ( 53,081 ) $ 4,542

Other expense (income):

Other (income) expense:

Interest expense $ 25,956 $ 25,277 $ 26,560

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Total other expenses, net $ 25,816 $ 24,550 $ 25,460

Loss before income taxes ( 77,631 ) ( 20,918 ) ( 78,136 )

Income tax expense (benefit) ( 90 ) 310 747

Net loss $ ( 77,541 ) $ ( 21,228 ) $ ( 78,883 )

Loss per share:

Income (loss) before income taxes

$ ( 23,026 ) $ ( 77,631 ) $ ( 20,918 )

Income tax (benefit) expense

$ 258 $ ( 90 ) $ 310

Net income (loss)

$ ( 23,284 ) $ ( 77,541 ) $ ( 21,228 )

Income (loss) per share:

Basic $ ( 1.31 ) $ ( 4.93 ) $ ( 1.34 )

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Diluted 17,789 15,736 15,835

Other comprehensive (loss) income:

Other comprehensive income (loss):

Foreign currency translation adjustment $ 2 $ ( 40 ) $ 12

Other comprehensive (loss) income, net of tax ( 40 ) 12 ( 35 )

Total comprehensive loss $ ( 77,581 ) $ ( 21,216 ) $ ( 78,918 )

Other comprehensive income (loss), net of tax

$ 2 $ ( 40 ) $ 12

Total comprehensive income (loss)

$ ( 23,282 ) $ ( 77,581 ) $ ( 21,216 )

See Notes to Consolidated Financial Statements.

RED ROBIN GOURMET BURGERS, INC.

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' (DEFICIT) EQUITY

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT)

(In thousands)

Common Stock Treasury Stock Accumulated

Comprehensive

(Loss) Income,

net of tax Retained

Comprehensive Income (Loss),

Shares Amount Shares Amount Total

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Exercise of options, issuance of restricted stock, shares exchanged for exercise and tax, and stock issued through employee stock purchase plan — — ( 456 ) 18,068 ( 16,063 ) — — 2,005

Non-cash stock compensation — — — — 6,323 — — 6,323

Net loss — — — — — — ( 78,883 ) ( 78,883 )

Other comprehensive loss — — — — — ( 35 ) — ( 35 )

Balance, December 25, 2022 20,449 20 4,515 ( 182,810 ) 238,803 ( 34 ) ( 54,190 ) 1,789

Exercise of options, issuance of restricted stock, shares exchanged for exercise and tax, and stock issued through employee stock purchase plan — — ( 456 ) 18,068 ( 16,063 ) — — 2,005

Acquisition of treasury stock — — 862 ( 9,960 ) — — — ( 9,960 )

Non-cash stock compensation — — — — 6,940 — — 6,940

Net loss — — — — — — ( 21,228 ) ( 21,228 )

Other comprehensive income — — — — — 12 — 12

Net income (loss) — — — — — — ( 21,228 ) ( 21,228 )

Other comprehensive income (loss) — — — — — 12 — 12

Balance, December 31, 2023 20,449 $ 20 4,921 $ ( 174,702 ) $ 229,680 $ ( 22 ) $ ( 75,418 ) $ ( 20,442 )

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Non-cash stock compensation — — — — 6,961 — — 6,961

Net loss — — — — — — ( 77,541 ) ( 77,541 )

Net income (loss) — — — — — — ( 77,541 ) ( 77,541 )

Common stock issuance 1,601 2 — — 7,091 — — 7,093

Other comprehensive loss — — — — — ( 40 ) — ( 40 )

Other comprehensive income (loss) — — — — — ( 40 ) — ( 40 )

Balance, December 29, 2024 22,050 $ 22 4,647 $ ( 164,937 ) $ 233,667 $ ( 62 ) $ ( 152,959 ) $ ( 84,269 )

Issuance of restricted stock, shares exchanged for exercise and tax, and stock issued through employee stock purchase plan — — ( 606 ) 21,690 ( 21,218 ) — — 472

Non-cash stock compensation — — — — 1,210 — — 1,210

Net income (loss) — — — — — — ( 23,284 ) ( 23,284 )

Equity issuance costs — — — — ( 479 ) — — ( 479 )

Other comprehensive income (loss) — — — — — 2 — 2

Balance, December 28, 2025 22,050 $ 22 4,041 $ ( 143,247 ) $ 213,180 $ ( 60 ) $ ( 176,243 ) $ ( 106,348 )

See Notes to Consolidated Financial Statements.

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Cash Flows From Operating Activities:

Net loss $ ( 77,541 ) $ ( 21,228 ) $ ( 78,883 )

Adjustments to reconcile net loss to net cash provided by operating activities:

Net income (loss)

$ ( 23,284 ) $ ( 77,541 ) $ ( 21,228 )

Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:

Depreciation and amortization 51,120 57,729 66,190

Gift card breakage ( 5,243 ) ( 7,930 ) ( 9,874 )

Asset impairment 2,713 32,838 9,130

Non-cash other charges (gains) ( 5 ) ( 1,404 ) ( 3,440 )

Non-cash other (gains) charges

( 1,633 ) ( 5 ) ( 1,404 )

Stock-based compensation expense 1,469 6,961 6,933

Gain on sale of property ( 1,127 ) ( 7,425 ) ( 30,137 )

Amortization of debt issuance costs 3,764 2,467 2,032

Other, net 927 ( 114 ) ( 794 )

Changes in operating assets and liabilities:

Accounts receivable 1,706 364 ( 26 )

Accounts receivable and other, net

247 1,903 397

Inventories 134 ( 220 ) ( 280 )

Income tax receivable 197 33 15,263

Prepaid expenses and other current assets ( 653 ) ( 597 ) 1,558

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Purchases of property, equipment and intangible assets $ ( 30,784 ) $ ( 26,034 ) $ ( 49,440 )

Proceeds from sale-leaseback 23,271 58,801 —

Proceeds from sales of property and equipment, and other 6,166 24,287 61,195

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Cash Flows From Financing Activities:

Proceeds from borrowings on revolving credit facilities

84,500 — 97,151

Repayments of borrowings on revolving credit facilities

( 64,500 ) ( 15,000 ) ( 264,227 )

Proceeds from borrowings on term loan

Net (repayments) borrowings on revolving credit facility $ ( 17,000 ) $ 20,000 $ ( 15,000 )

Repayments of borrowings on term loan

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Proceeds from borrowings for insurance premium financing

Repayments of borrowings for insurance premium financing

3,540 4,265 —

Repayments of insurance premium financing

( 4,403 ) ( 3,619 ) —

Purchase of treasury stock — — ( 9,960 )

Debt issuance costs ( 575 ) ( 2,749 ) —

Proceeds related to real estate sale

Proceeds from issuance of common stock, net of stock issuance costs ( 479 ) 7,093 —

(Uses) proceeds from other financing activities, net ( 299 ) 2,003 ( 86 )

Proceeds (uses) from other financing activities, net

471 ( 299 ) 2,003

Net cash provided by (used in) financing activities $ ( 22,252 ) $ 2,536 $ ( 33,712 )

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Supplemental disclosure of cash flow information

Income taxes paid (refunds received), net $ 83 $ 454 $ ( 14,642 )

Interest paid, net of amounts capitalized 22,737 24,084 16,054

Net (refunds received) income taxes paid

$ ( 30 ) $ 83 $ 454

Interest paid

23,133 22,737 24,084

Accrued purchases of property, equipment and intangible assets 3,296 2,707 1,836

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(a) 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 casual dining restaurants in North America.

Red Robin Gourmet Burgers, Inc., a Delaware corporation, is the parent company for Red Robin International, Inc., a Nevada corporation, that, together with its subsidiaries ("Red Robin," "we," "us," "our", or the "Company"), primarily operates, franchises, and develops casual dining restaurants in North America.

As of December 28, 2025, the Company owned and operated 385 restaurants located in 39 states.

The Company also had 90 casual dining restaurants operated by franchisees in 13 states and one Canadian province.

The Company operates its business as one operating and one reportable segment.

The Company operated its business as one operating and one reportable segment.

(b) Basis of Presentation and Principles of Consolidation

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The Company's financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP").

In the opinion of management, all adjustments (consisting of normal recurring adjustments) considered necessary for a fair presentation have been included.

In the opinion of management, all 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.

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Certain amounts presented have been reclassified within the current period presentation.

Certain amounts presented have been reclassified to conform with the current period presentation.

The reclassifications had no effect on the Company's consolidated results.

We made adjustments to the Consolidated Statements of Cash Flows to disaggregate borrowing and repayment activity on long term debt and finance lease obligations, to reclassify gift card breakage within unearned revenue, and to reclassify amortization of debt issuance costs within other, net.

We made adjustments to the Consolidated Statements of Cash Flows to include income tax receivable within accounts receivable and other, net, to net borrowings with repayments on revolving credit facilities, to include net proceeds from sale-leaseback within net proceeds from sale of property, equipment, and other, and to separately disclose the following captions:

to disaggregate gift card breakage from the change in unearned revenue;

and to disaggregate amortization of debt issuance costs from other, net.

We have also revised the presentation of operating expenses in the Consolidated Statements of Operations and Comprehensive Income (Loss) to separately disclose selling expenses and general and administrative expenses.

Previously, these amounts were presented on a combined basis as selling, general, and administrative expenses.

Certain prior-year amounts related to restaurant closure costs have been disaggregated and reclassified into closed store rent and other costs and lease modification (gains) losses within Note 4.

Other (Gains) Charges, net to conform to the current-year presentation.

(d) Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States 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 periods.

Actual results could differ from those estimates.

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The Company recognizes revenues from restaurant operations when payment is tendered at the point of sale, as the Company's performance obligation to provide food and beverage to the customer has been satisfied.

The Company sells gift cards which do not have an expiration date, and it does not deduct dormancy fees from outstanding gift card balances.

The Company sells gift cards that do not have an expiration date, and it does not deduct dormancy fees from outstanding gift card balances.

We recognize revenue from gift cards as either:

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Revenues we receive from our franchise arrangements include sales-based royalties, advertising fund contributions, area development fees, and franchise fees.

Red Robin franchisees are required t o remit 4.0 % to 5.0 % of their revenues as royalties to the Company and contribute up to 3.0 % of revenues to two national advertising funds.

Red Robin franchisees are required t o r emit 4 % to 5 % of t heir revenues as royalties to the Company and contribute up to 3 % of revenues to two national advertising funds.

The Com pany recognizes these sales-based royalties and advertising fund contributions as the underlying franchisee sales occur.

Contributions to these advertising funds from franchisees are recorded as revenue under Franchise revenue in the Consolidated Statements of Operations and Comprehensive Loss in accordance with ASC Topic 606, Revenue from Contracts with Customers .

Contributions to these advertising funds from franchisees are recorded as revenue under franchise revenue in the Consolidated Statements of Operations and Comprehensive Income (Loss) in accordance with ASC Topic 606, Revenue from Contracts with Customers .

The Company typically grants franchise rights to franchisees for a term of 20 years, with the right to extend the term for an additional 10 years if various conditions are satisfied by the franchisee.

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Cash and Cash Equivalents, and Restricted Cash - The Company considers all highly liquid instruments with an original maturity of three months or less to be cash equivalents.

Amounts receivable from credit card issuers are typically converted to cash within two to four days of the original sales transaction and are considered to be cash equivalents.

Amounts receivable from credit card issuers are typically converted to cash within two days to four days of the original sales transaction and are considered to be cash equivalents.

Cash and cash equivalents are maintained with multiple financial institutions.

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The Company is required to carry restricted cash balances that are reserved as collateral for existing letters of credit.

The amounts issued under letters of credit, which are undrawn totaled $ 8.5 million.

Accounts Receivable, Net - Accounts receivable, net consists primarily of third-party gift card receivables, third party delivery partner receivables, trade receivables due from franchisees for royalties and advertising fund contributions, and tenant improvement allowances.

At the end of fiscal 2024, there was approximately $ 9.2 million of gift card receivables in accounts receivable related to gift cards that were sold by third party retailers compared to $ 9.7 million at the end of fiscal 2023.

At the end of 2024, there was also approximately $ 2.2 million related to third party delivery partners in accounts receivable compared to approximately $ 2.6 million at the end of fiscal 2023.

The amounts issued under letters of credit, which are undrawn, totaled $ 9.3 million at December 28, 2025.

Accounts Receivable, net - Accounts receivable, net consists primarily of third-party gift card receivables, third party delivery partner receivables, rebate receivables, and trade receivables due from franchisees for royalties and advertising fund contributions.

(In thousands) 2025 2024

Gift card receivable $ 8,131 $ 9,241

Third party delivery partner receivable

Rebate receivable

Trade receivable

Other receivable

Total accounts receivable, net

$ 19,441 $ 19,688

Inventories - Inventories consist of food, beverages, and supplies valued at the lower of cost (first-in, first-out method) or net realizable value.

At the end of fiscal 2024 and 2023, food and beverage inventories were $ 9.2 million and $ 9.4 million, respectively, and supplies inventories were $ 17.5 million and $ 17.4 million, respectively.

(In thousands) 2025 2024

Food & beverage inventory $ 9,330 $ 9,206

Supplies inventory 16,399 17,531

$ 25,729 $ 26,737

Property and Equipment, net - Property and equipment are recorded at cost.

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Depreciation is computed on the straight-line method based on the shorter of the estimated useful lives or the terms of the underlying leases of the related assets.

Interest incurred on funds used to construct Company-owned restaurants is capitalized and amortized over the estimated useful life of the related assets.

Interest incurred on funds used to place Company-owned assets in service is capitalized and amortized over the estimated useful life of the related assets, which amounted to $ 0.6 million and $ 1.0 million in fiscal 2025 and fiscal 2024, respectively.

The estimated useful lives for property and equipment are:

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Capitalized cloud computing implementation costs were $ 1.2 million and $ 1.2 million, net of accumulated amortization, as of December 28, 2025 and December 29, 2024, respectively.

These costs are included in prepaid expenses and other current assets and other assets in our consolidated balance sheets.

Related amortization expense was $ 0.5 million, $ 0.4 million, and $ 0.1 million for the years ended December 29, 2024, December 31, 2023, and December 25, 2022, respectively, and is included in selling, general and administrative expenses in our consolidated statements of operations and comprehensive loss.

These costs are included in prepaid expenses and other current assets and other assets, net in our Consolidated Balance Sheets.

Related amortization expense were $ 1.0 million, $ 0.5 million, and $ 0.4 million for the years ended December 28, 2025, December 29, 2024, and December 31, 2023, respectively, and was included in other operating, selling, and general and administrative in our Consolidated Statements of Operations and Comprehensive Income (Loss).

Leases - The Company leases land, buildings, and equipment used in its operations under operating and finance leases.

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We have elected the short-term lease recognition exemption for all applicable classes of underlying assets.

Short-term disclosures include only those leases with a term of 12 months or less, and expense is recognized on a straight-line basis over the lease term.

Leases with an initial term of 12 months or less, that do not include an option to purchase the underlying asset that we are reasonably certain to exercise, are not recorded on the balance sheet.

We elected the practical expedient that does not require us to separate lease and non-lease components for our population of real estate assets.

Short-term disclosures include only those leases with a term of 12 months or less, and expense is recognized on a straight-line basis over

the lease term.

Leases with an initial term of 12 months or less, that do not include an option to purchase the underlying asset that we are reasonably certain to exercise, are not recorded in our Consolidated Balance Sheets.

We have elected the practical expedient that does not require us to separate lease and non-lease components for our population of real estate assets.

Intangible Assets, net - Intangible assets comprise primarily leasehold interests, acquired franchise rights, and the costs of purchased liquor licenses.

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Impairment of Long-Lived Assets - The Company reviews its long-lived assets, including restaurant sites, leasehold improvements, information technology systems, right of use assets, and amortizable intangible assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable.

Recoverability of

assets to be held and used is measured by a comparison of the carrying amount of the assets to the future undiscounted net cash flows expected to be generated by the assets.

Recoverability of assets to be held and used is measured by a comparison of the carrying amount of the assets to the future undiscounted net cash flows expected to be generated by the assets.

Identifiable cash flows are measured at the lowest level, for which they are largely independent of the cash flows of other groups of assets and liabilities, generally at the restaurant-level.

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Primary advertising channels include television advertising, digital media, social media programs, email, loyalty, and public relations initiatives.

Total advertising costs of $ 23.5 million, $ 21.6 million, and $ 35.7 million in fiscal 2024, 2023, and 2022 and were included in Selling, general, and administrative expenses.

Additionally, for corporate owned stores, we may choose to invest additional discretionary advertising above and beyond the 3 % of revenues.

Total advertising costs of $ 18.7 million, $ 23.5 million, and $ 21.6 million in fiscal years 2025, 2024, and 2023, respectively, and were included in selling expenses in our Consolidated Statements of Operations and Comprehensive Income (Loss).

Advertising production costs are expensed in the period when the advertising first takes place.

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Predetermined loss limits have been arranged with insurance companies to limit the Company's per occurrence cash outlay.

Accrued liabilities and other current liabilities and accrued payroll and payroll-related liabilities include the estimated cost to settle reported claims and incurred but unreported claims.

The self-insurance liability represents an estimate of the ultimate cost of claims incurred and unpaid as well as claims incurred but not reported ("IBNR") as of the balance sheet date.

Our estimated liability is based on information provided by third-party actuaries, combined with our judgments regarding several assumptions, including the frequency and severity of claims, our loss development factors, loss cost, claims history, and our claims settlement practice.

Significant judgment is required to estimate IBNR claims as parties have yet to assert such claims.

Accrued liabilities and other current liabilities and accrued payroll and payroll-related liabilities include the estimated cost to settle reported claims and incurred but not reported claims.

Legal Contingencies - In the normal course of business, we are subject to various legal proceedings and claims, the outcomes of which are uncertain.

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Costs related to preparing restaurants to introduce Donatos ® are expensed as incurred and included in pre-opening costs.

Income Taxes - Deferred tax liabilities are recognized for the estimated effects of all taxable temporary differences, and deferred tax assets are recognized for the estimated effects of all deductible temporary differences, net operating losses, and tax credit carryforwards.

Realization of net deferred tax assets is dependent upon profitable operations and future reversals of existing taxable temporary differences.

However, the amount of the deferred tax assets considered realizable could be adjusted if estimates of future taxable income during the carry forward period are increased or reduced or if there are differences in the timing or amount of future reversals of existing taxable temporary differences.

Management regularly evaluates the future realization of deferred tax assets and provides a valuation allowance against the deferred tax assets, if considered necessary, based on such evaluation.

Pursuant to the guidance for uncertain tax positions, a taxpayer must be able to more likely than not sustain a position to recognize a tax benefit, and the measurement of the benefit is calculated as the largest amount that is more than 50 percent likely to be realized upon resolution of the benefit.

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The Company records interest and penalties associated with audits as a component of income before taxes.

The Company recorded immaterial penalty and interest expense on the identified tax liabilities in fiscal 2024, 2023, and 2022.

Loss Per Share - Basic loss per share amounts are calculated by dividing net loss by the weighted average number of common shares outstanding during the year.

Diluted loss per share amounts are calculated based upon the weighted average number of common and potentially dilutive common shares outstanding during the year.

The Company recorded immaterial penalty and interest expense on the identified tax liabilities in fiscal years 2025, 2024, and 2023.

Income (Loss) Per Share - Basic income (loss) per share amounts are calculated by dividing net income (loss) by the weighted average number of common shares outstanding during the year.

Diluted income (loss) per share amounts are calculated based upon the weighted average number of common and potentially dilutive common shares outstanding during the year.

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 and awards exercised their holdings into common stock.

Diluted income (loss) per share reflects the potential dilution that could occur if holders of options and awards exercised their holdings into common stock.

As the Company was in a net loss position for each of the fiscal years ended December 28, 2025, December 29, 2024, and December 31, 2023, all potentially dilutive common shares are considered anti-dilutive.

The Company uses the treasury stock method to calculate the impact of outstanding stock options and awards.

Basic weighted average shares outstanding is reconciled to diluted weighted average shares outstanding for the fiscal years ended December 29, 2024, December 31, 2023, and December 25, 2022 as follows (in thousands):

Basic weighted average shares outstanding is reconciled to diluted weighted average shares outstanding as of the fiscal years ended December 28, 2025, December 29, 2024, and December 31, 2023, were as follows (in thousands):

2025 2024 2023

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Awards excluded due to anti-dilutive effect on diluted earnings per share $ 2,599 $ 1,749 $ 1,409

Comprehensive Loss - Total comprehensive loss consists of the net loss and other gains and losses affecting stockholders' equity that, under U.S.

GAAP, are excluded from net income.

Other comprehensive (loss) income as presented in the consolidated statements of operations and comprehensive loss for fiscal 2024, 2023, and 2022 consisted of the foreign currency translation adjustment resulting from the Company's Canadian franchise operations.

Stock-Based Compensation - The Company maintains several equity incentive plans under which it may grant stock options, stock appreciation rights, restricted stock, stock variable compensation, or other forms of awards granted or denominated in the Company's common stock or units of the Company's common stock, as well as cash variable compensation awards to employees, non-employees, directors, and consultants.

Comprehensive Income (Loss) - Total comprehensive income (loss) consists of the net income (loss) and other gains and losses affecting stockholders' equity that, under GAAP, are excluded from net income (loss).

Other comprehensive income (loss) as presented in the Consolidated Statements of Operations and Comprehensive Income (Loss) for fiscal years 2025, 2024, and 2023 consisted of the foreign currency translation adjustment resulting from the Company's Canadian franchise operations.

Stock-Based Compensation - The Company maintains several equity incentive plans under which it may grant stock options, stock appreciation rights, restricted stock units, performance stock units, or other forms of awards granted or denominated in the Company's common stock or units of the Company's common stock, as well as cash variable compensation awards to employees, non-employees, directors, and consultants.

The Company also maintains an employee stock purchase plan.

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The assets of the deferred compensation plan are held in a rabbi trust, where they are invested in certain mutual funds that cover an investment spectrum range from equities to money market instruments.

Fluctuations in the market value of the investments held in the trust result in the recognition of deferred compensation expense or income reported in Selling, general, and administrative expenses and recognition of investment gain or loss reported in Interest income and other, net, in the consolidated statements of operations and comprehensive loss.

Fluctuations in the market value of the investments held in the trust result in the recognition of deferred compensation expense or income.

Refer to Note 15.

Employee Benefit Programs for additional information.

Recent Accounting Pronouncements

In November 2024, the FASB issued Update 2024-03 which expands disclosures about specific expense categories presented on the face of the income statement.

Update 2024-03 is effective for financial statements issued for annual periods beginning after December 15, 2026, with early adoption permitted.

The Company is evaluating the impact of the adoption of Update 2024-03 to the consolidated financial statements.

In December 2023, the FASB issued Update 2023-09 to improve income tax disclosure requirements, primarily related to rate reconciliations and income taxes paid.

Update 2023-09 is effective for financial statements issued for annual periods beginning after December 15, 2024, with early adoption permitted.

The Company is evaluating the impact of the adoption of Update 2023-09 to the 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 consolidated financial statements.

In December 2025, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2025-12, Codification Improvements, which included amendments intended to clarify, improve, and correct various sections of

the Accounting Standards Codification.

The amendments addressed a variety of topics, including earnings per share, equity, leases, revenue recognition, credit losses, and other areas, and are primarily intended to improve the consistency and clarity of existing guidance without significantly changing current accounting practice.

The amendments are effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods within those annual reporting periods, with early adoption permitted.

The Company is evaluating the impact of the adoption of ASU 2025-12 on the Consolidated Financial Statements.

In December 2025, the FASB issued ASU 2025-11, Interim Reporting (Topic 270):

Narrow-Scope Improvements to clarify and improve the guidance in ASC 270 regarding interim reporting.

ASU 2025-11 improved the navigability of the guidance, clarifying when the interim reporting guidance applies, and specifying the disclosures and form and content requirements for interim financial statements and accompanying notes under GAAP.

The amendments are effective for interim reporting periods within annual reporting periods beginning after December 15, 2027, with early adoption permitted.

The Company is evaluating the impact of the adoption of ASU 2025-11 on the Consolidated Financial Statements.

In September 2025, the FASB issued ASU 2025-06, Intangibles—Goodwill and Other— Internal-Use Software (Subtopic 350-40) to introduce a principles-based framework for capitalizing costs related to the development of internal-use software.

ASU 2025-06 also incorporated website development costs into the internal-use software guidance and enhanced related disclosure requirements.

The amendments are effective for annual reporting periods beginning after December 15, 2027, and interim reporting periods within those annual reporting periods.

The Company is evaluating the impact of the adoption of ASU 2025-06 on the Consolidated Financial Statements.

In July 2025, the FASB issued ASU 2025-05, Financial Instruments – Credit Losses (Topic 326):

Measurement of Credit Losses for Accounts Receivable and Contract Assets, to provide a practical expedient and an accounting policy election related to the estimation of expected credit losses for current accounts receivable and current contract assets that arise from transactions accounted for under Accounting Standards Codification ("ASC") 606 - Revenue from Contracts with Customers.

The amendments are effective for annual reporting periods beginning after December 15, 2025, and interim reporting periods within those annual reporting periods.

The Company is evaluating the impact of the adoption of ASU 2025-05 on the Consolidated Financial Statements.

In November 2024, the FASB issued ASU 2024-03 which expands disclosures about specific expense categories presented on the face of the income statement.

ASU 2024-03 is effective for financial statements issued for annual periods beginning after December 15, 2026, with early adoption permitted.

The Company is evaluating the impact of the adoption of ASU 2024-03 on the Consolidated Financial Statements.

In December 2023, the FASB issued ASU 2023-09 to improve income tax disclosure requirements, primarily related to rate reconciliations and income taxes paid.

ASU 2023-09 is effective for financial statements issued for annual periods beginning after December 15, 2024.

The adoption of this standard has been reflected in Note 11.

Income Taxes within the Notes to the Consolidated Financial Statements.

We reviewed all other recently issued accounting pronouncements and concluded they were either not applicable or not expected to have a material impact on the Consolidated Financial Statements.

Recently Issued Tax Legislation

On July 4, 2025, the One Big Beautiful Bill Act ("OBBBA") was enacted in the U.S.

The OBBBA includes significant provisions, such as the permanent extension of certain expiring provisions of the Tax Cuts and Jobs Act and the restoration of favorable tax treatment for specific business provisions.

The legislation has multiple effective dates, with some provisions taking effect in tax year 2025 and others phased in through tax year 2027.

In accordance with ASC 740 - Income Taxes, the effects of changes in tax rates and laws are recognized in the period in which the legislation is enacted.

The OBBBA did not have a material impact on the Consolidated Financial Statements.

Disaggregation of Revenue

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Unearned gift card revenue $ 24,096 $ 24,333

Deferred loyalty revenue 2,750 7,509

Unearned Royalty revenue

Unearned revenue $ 27,287 $ 27,083

Revenue recognized in the Consolidated Statements of Operations and Comprehensive Loss for the redemption of gift cards that were included in the liability balance at the beginning of the fiscal year was as follows (in thousands):

Revenue recognized in the Consolidated Statements of Operations and Comprehensive Income (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):

December 28, 2025 December 29, 2024 December 31, 2023

Gift card revenue $ 13,070 $ 16,782 $ 19,224

We recognize Royalty revenue within Restaurant revenue in the Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) when a customer redeems an earned reward.

Unearned revenue associated with Royalty is included in Unearned revenue in our Condensed Consolidated Balance Sheets.

We recognize revenue from our customer loyalty program, Red Robin Royalty ("Royalty"), within restaurant revenue in the Consolidated Statements of Operations and Comprehensive Income (Loss) when a customer redeems an earned reward.

Unearned revenue associated with our Royalty program is included in unearned revenue in our Consolidated Balance Sheets.

Changes in our unearned revenue balance related to our Royalty program (in thousands):

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Unearned Royalty revenue, beginning balance

$ 2,750 $ 7,509

Revenue deferred 5,352 4,817

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Unearned Royalty revenue, ending balance $ 3,191 $ 2,750

(1) Restaurant revenue includes an approximately $ 6.4 million credit related to the transition to the new Royalty program in the second quarter of fiscal 2024, primarily due to the cancellation of unused points that were earned more than 365 days prior to the launch of the new program.

Impairment and Other Charges (Gains), net

Impairment and other charges consist of the following (in thousands):

(1) Restaurant revenue recognized during the fifty-two weeks ended December 29, 2024 included a credit of approximately $ 6.4 million related to the transition to the new Royalty program in the second quarter of fiscal 2024, primarily due to the cancellation of unused points that were earned more than 365 days prior to the launch of the new program.

Other (Gains) Charges, net

Other (gains) charges, net consisted of the following (in thousands):

December 28, 2025 December 29, 2024 December 31, 2023

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2,181 1,181 3,419

Other financing costs — — 1,462

Litigation contingencies 2,198 1,037 9,140

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4,426 4,975 2,129

Impairment and other charges (gains), net $ 33,848 $ ( 2,663 ) $ 38,961

Asset Impairment and Restaurant Closure Costs

During fiscal 2024, the Company closed eight locations and is evaluating alternatives for approximately 70 underperforming restaurant locations, including closure upon expiration of the current lease term.

The Company recognized non-cash impairment charges of $ 32.8 million, primarily associated with this review of underperforming locations as well as impairment of quota state liquor licenses at three locations.

In addition, the Company recorded $ 1.2 million in charges associated with the eight store closures in fiscal 2024.

During fiscal 2023, the Company recognized non-cash impairment charges of $ 9.1 million, primarily related to the impairment of long-lived assets at 19 underperforming locations and quota state liquor licenses at three locations.

In addition, the Company recorded $ 3.1 million in charges associated with five closed locations.

During fiscal 2022, the Company recognized non-cash impairment charges of $ 38.5 million, primarily related to impairments of long-lived assets at 46 underperforming locations and quota state liquor licenses at six locations.

In addition, the Company recorded $ 0.8 million in costs associated with 16 closed locations during fiscal 2022.

Severance and Executive Transition

During fiscal 2024, 2023, and 2022, the Company incurred severance and executive transition costs primarily related to a reduction in force of Team Members and costs associated with changes in leadership positions.

Other (gains) charges, net $ 10,463 $ 33,848 $ ( 2,663 )

(1) Severance and executive transition included $( 4.1 ) million, $ 0.1 million, and $ 0.1 million of stock-based compensation (benefit) expense in fiscal years 2025, 2024, and 2023, respectively.

Asset Impairment and Restaurant Closure Costs, net

Asset impairment and restaurant closure costs, net consisted of the following (in thousands, except for location data):

December 28, 2025 December 29, 2024 December 31, 2023

Number of non-operating locations

Non-operating location rent, restaurant closure costs, and other

$ 4,291 $ 3,676 $ 5,432

Number of impaired locations

Non-cash impairment

$ 2,713 $ 32,838 $ 9,130

Number of locations with lease remeasurement

Net lease remeasurement (gain) loss

$ ( 4,219 ) $ ( 2,434 ) $ ( 2,370 )

Total asset impairment and restaurant closure costs, net

$ 2,785 $ 34,080 $ 12,192

Gain on Sale of Restaurant Property

During fiscal 2024, the Company sold ten restaurant properties for aggregate net proceeds of $ 23.3 million in a sale-leaseback transaction that resulted in a gain, net of expenses of $ 7.4 million.

The net proceeds are included within cash flows from investing activities on the Consolidated Statements of Cash Flows for the year ended December 29, 2024.

During fiscal 2023, the Company sold 18 restaurant properties for aggregate net proceeds of $ 58.8 million in sale-leaseback transactions that resulted in a gain, net of expenses of $ 29.4 million.

In addition, during 2023, the Company sold one restaurant property for net proceeds of $ 1.5 million which resulted in a gain, net of expenses of $ 0.1 million.

The net proceeds are included within cash flows from investing activities on the Consolidated Statements of Cash Flows for the year ended December 31, 2023.

During fiscal 2022, the Company sold one restaurant property for aggregate net proceeds of $ 12.4 million in a short-term sale-leaseback transaction that resulted in a gain, net of expenses of $ 9.2 million.

The net proceeds are included within cash flows from investing and financing activities on the Consolidated Statements of Cash Flows for the year ended December 25, 2022.

During fiscal 2025, the Company sold three restaurant properties for total proceeds of $ 5.8 million that resulted in a gain, net of expenses of $ 1.1 million.

The net proceeds were included within cash flows from investing activities on the Consolidated Statements of Cash Flows for the year ended December 28, 2025, and were used to repay long-term debt.

During fiscal 2024, the Company sold ten restaurant properties for total proceeds of $ 23.9 million in sale-leaseback transactions that resulted in a gain, net of expenses of $ 7.4 million.

The net proceeds were included within cash flows from investing activities on the Consolidated Statements of Cash Flows for the year ended December 29, 2024.

During fiscal 2023, the Company sold 18 restaurant properties for total proceeds of $ 58.8 million in a sale-leaseback transaction that resulted in a gain, net of expenses of $ 29.4 million.

In addition, during 2023, the Company sold one restaurant property for total proceeds of $ 1.5 million which resulted in a gain, net of expenses of $ 0.1 million.

The net proceeds were included within cash flows from investing activities on the Consolidated Statements of Cash Flows for the year ended December 31, 2023.

Severance and Executive Transition

Severance and executive transition consisted of the following (in thousands):

December 28, 2025 December 29, 2024 December 31, 2023

Executive severance

$ 4,915 $ 476 $ 2,298

Stock-based compensation (1)

( 4,104 ) 71 128

Team member severance (2)

1,370 634 993

Total severance and executive transition

$ 2,181 $ 1,181 $ 3,419

(1) For fiscal 2025, the stock-based compensation benefit related primarily to the forfeiture of unvested stock-based compensation by certain executive leadership.

(2) During fiscal 2025, team member severance was primarily associated with a reduction in force, which occurred during the second quarter of fiscal 2025.

Litigation Contingencies

In fiscal 2024, 2023, and 2022, the Company recorded reserves associated with litigation contingencies.

In fiscal years 2025, 2024, and 2023, the Company recorded certain accruals associated with litigation contingencies.

Commitments and Contingencies, for further discussion.

Asset Disposal and Other

Asset disposal and other primarily relates to lease terminations and closures of restaurants and corporate office locations, asset disposals, strategic projects and other non-recurring items.

Asset disposal and other primarily related to asset disposals, strategic projects and other non-recurring items.

Property and Equipment, net

Property and equipment consist of the following at December 29, 2024 and December 31, 2023 (in thousands):

Property and equipment, net consisted of the following as of December 28, 2025 and December 29, 2024 (in thousands):

December 28, 2025 December 29, 2024

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Property and equipment, net $ 158,105 $ 181,224

Depreciation and amortization expense on property and equipment was $ 55.4 million in 2024, $ 63.8 million in fiscal 2023, and $ 73.7 million in fiscal 2022.

Intangible Assets

The following table presents intangible assets as of December 29, 2024 and December 31, 2023 (in thousands):

Depreciation and amortization expense on property and equipment were $ 49.3 million, $ 55.4 million, and $ 63.8 million in fiscal years 2025, 2024, and 2023, respectively.

Intangible Assets, net

Intangible assets, net consisted of the following as of December 28, 2025 and December 29, 2024 (in thousands):

December 28, 2025 December 29, 2024

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Intangible assets, net $ 71,443 $ ( 62,288 ) $ 9,155 $ 73,036 $ ( 61,972 ) $ 11,064

The aggregate amortization expense related to intangible assets subject to amortization for fiscal 2024, 2023, and 2022 was $ 2.3 million, $ 2.4 million, and $ 2.5 million.

The estimated aggregate future amortization expense as of December 29, 2024 is as follows (in thousands):

The aggregate amortization expense related to intangible assets subject to amortization were $ 1.8 million, $ 2.3 million, and $ 2.4 million for fiscal years 2025, 2024, and 2023, respectively.

The estimated aggregate future amortization expense as of December 28, 2025 were as follows (in thousands):

Thereafter 924

Accrued Payroll and Payroll-Related Liabilities, and Accrued Liabilities and Other Current Liabilities

Accrued payroll and payroll-related liabilities consist of the following at December 29, 2024 and December 31, 2023 (in thousands):

Accrued Payroll and Payroll-Related Liabilities, and Accrued Liabilities and Other

Accrued payroll and payroll-related liabilities consisted of the following as of December 28, 2025 and December 29, 2024 (in thousands):

December 28, 2025 December 29, 2024

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Accrued payroll and payroll-related liabilities $ 44,039 $ 39,672

Accrued liabilities and other current liabilities consist of the following at December 29, 2024 and December 31, 2023 (in thousands):

(1) This balance was inclusive of $ 2.9 million and $ 0.0 million for fiscal years 2025 and 2024, respectively, related to severance and executive transition costs.

Included within corporate and restaurant incentive compensation are accrued termination benefits, which represent one-time termination benefits primarily related to changes in leadership positions as a result of strategic pivots under previous strategies and the First Choice plan.

These plans, and the related reductions in force, are accounted for in accordance with ASC Topic 420, Exit or Disposal Cost Obligations .

The charges incurred under previous strategies were recognized in fiscal 2023 and fully paid as of the end of fiscal 2024.

The Company incurred a cumulative total of $ 1.4 million in one-time termination benefits during fiscal 2025 related to the First Choice plan reduction in force, and was included in Other (gains) charges, net in the Consolidated Statements of Operations and Comprehensive Income (Loss).

One-time termination benefits activity for the fiscal years ended December 29, 2024 and December 28, 2025, respectively, were as follows:

Termination Benefits

Balance as of December 31, 2023

Cash Payments ( 184 )

Balance as of December 29, 2024

Charges 1,370

Cash Payments ( 1,033 )

Balance as of December 28, 2025

Accrued liabilities and other consisted of the following as of December 28, 2025 and December 29, 2024 (in thousands):

December 28, 2025 December 29, 2024

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Real estate, personal property, state income, and other taxes payable 7,937 6,933

10,092 10,201

Utilities 2,615 3,016

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Current portion of finance lease liabilities 1,092 1,019

Accrued termination benefits

Other 9,673 6,237

Accrued liabilities and other current liabilities $ 42,931 $ 46,201

Accrued termination benefits represents one-time termination benefits primarily related to changes in leadership positions as a result of our strategic pivot under the North Star plan and a related reduction in force and are accounted for in accordance with ASC Topic 420, Exit or Disposal Cost Obligations .

The Company incurred a cumulative total of $ 5.1 million in one-time termination benefits, which is comprised of $ 0 , $ 2.1 million, and $ 3.0 million recognized during fiscal 2024, 2023, and 2022, respectively, and included in Impairment and other charges (gains) in the Consolidated Statements of Operations and Comprehensive Loss.

One-time termination benefits activity for the years ended December 31, 2023 and December 29, 2024, respectively is as follows:

Termination Benefits

Balance as of December 25, 2022

Charges 2,077

Cash Payments ( 4,398 )

Balance as of December 31, 2023

Cash Payments ( 184 )

Balance as of December 29, 2024

Accrued liabilities and other

$ 46,801 $ 42,931

Borrowings as of December 28, 2025 and December 29, 2024 are summarized below:

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Total borrowings $ 170,217 $ 189,470

unamortized debt issuance costs and discounts (1)

unamortized debt issuance costs (1)

$ 5,476 $ 7,829

Long-term debt $ 164,741 $ 181,641

Revolving line of credit unamortized deferred financing charges (1) :

Revolving line of credit unamortized debt issuances costs (1) :

$ 932 $ 1,298

(1) Loan origination costs associated with the Company's Credit Facility are included as deferred costs in Other assets, net for financing charges allocated to the revolving line of credit, and Long-term debt for financing charges associated with the term loan in the accompanying Consolidated Balance Sheets.

Maturities of long-term debt as of December 29, 2024 are as follows (in thousands):

(1) Unamortized debt issuance costs associated with the Company's Credit Facility were included as deferred costs in other assets, net for financing charges allocated to the revolving line of credit, and long-term debt for financing charges associated with the term loan in the accompanying Consolidated Balance Sheets.

Maturities of long-term debt as of December 28, 2025 were as follows (in thousands):

Credit Facility

On March 4, 2022, the Company replaced its prior amended and restated Credit Agreement (the "Prior Credit Agreement") with a new Credit Agreement (the "Credit Agreement") by and among the Company, Red Robin International, Inc., as the borrower, the lenders from time to time party thereto, the issuing banks from time to time party thereto, Fortress Credit Corp., as Administrative Agent and as Collateral Agent and JPMorgan Chase Bank, N.A., as Sole Lead Arranger and Sole Bookrunner.

The five-year $ 240.0 million Credit Agreement provides for a $ 40.0 million revolving line of credit and a $ 200.0 million term loan (collectively, the "Credit Facility").

The borrower maintains the option to increase the Credit Facility in the future, subject to lenders’ participation, by up to an additional $ 40.0 million in the aggregate on the terms and conditions set forth in the Credit Agreement.

The Credit Facility will mature on March 4, 2027.

No amortization is required with respect to the revolving Credit Facility.

As of December 28, 2025, the Company's credit facility allowed for up to $ 240.0 million of borrowings and is comprised of a $ 40.0 million revolving line of credit and a $ 200.0 million term loan (collectively, the "Credit Facility").

As of December 28, 2025 and December 29, 2024, the Company had outstanding borrowings of $ 170.2 million and $ 189.5 million, respectively, inclusive of $ 3.0 million and $ 20.0 million drawn on its revolving line of credit, respectively, under its Credit Facility.

In addition, the Company had amounts issued under letters of credit of $ 9.3 million and $ 8.5 million as of December 28, 2025 and December 29, 2024, respectively.

The Credit Facility will mature on September 3, 2027.

The term loans require quarterly principal payments in an aggregate annual amount equal to 1.0 % of the original principal amount of the term loan.

The Credit Agreement's interest rate references the Secured Overnight Financing Rate ("SOFR"), a new index calculated by short-term repurchase agreements and backed by U.S.

As of December 28, 2025, the Company has fulfilled this obligation for the duration of the Credit Facility via previous principal payments.

The Credit Facility's interest rate references the Secured Overnight Financing Rate ("SOFR"), which is an index calculated by short-term repurchase agreements and backed by U.S.

Treasury securities, or the Alternate Base Rate ("ABR"), which represents the highest of (a) the Prime Rate, (b) the Federal Funds Rate plus 0.5 % per annum, or (c) one-month term SOFR plus 1.0 % per annum.

As of December 29, 2024, the Company had outstanding borrowings under the Credit Facility of $ 181.6 million, including $ 20.0 million drawn on its revolving line of credit.

As of December 31, 2023, the Company had outstanding borrowings under the Credit Facility of $ 182.6 million, with no amounts drawn on its revolving line of credit.

In addition, the Company had amounts issued under letters of credit of $ 8.5 million and $ 7.7 million as of December 29, 2024 and December 31, 2023, respectively.

Red Robin International, Inc., is the borrower under the Credit Agreement, and certain of its subsidiaries and the Company are guarantors of borrower’s obligations under the Credit Agreement.

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On August 21, 2024, the Company entered into the second amendment to the Credit Agreement (the "Second Amendment").

The Second Amendment, among other things, provides certain relief from the financial covenant by increasing the required maximum net total leverage ratio beginning in the third quarter of 2024 through the end of the third quarter of 2025;

increases the aggregate revolving commitments by $ 15.0 million to $ 40.0 million through the end of the third quarter of 2025;

removes the variable pricing grid and increases the applicable margin on all term loans and revolving loans that are SOFR-based loans to 7.50 % per annum and that are ABR-based loans to 6.50 % per annum;

and adds certain additional reporting requirements.

The Second Amendment, among other things, provided certain relief from the financial covenant by increasing the required maximum net total leverage ratio beginning in the third quarter of 2024 through the end of the third quarter of fiscal 2025;

increased the aggregate revolving commitments by $ 15.0 million to $ 40.0 million through the end of the third quarter of fiscal 2025;

removed the variable pricing grid and increases the applicable margin on all term loans and revolving loans that are SOFR-based loans to 7.50 % per annum and that are ABR-based loans to 6.50 % per annum;

and added certain additional reporting requirements.

On November 4, 2024, the Company entered into the third amendment to the Credit Agreement (the "Third Amendment").

The Third Amendment extended the provisions of the Second Amendment through the end of the first fiscal quarter of 2026.

In conjunction with the execution of the Second Amendment and Third Amendment (collectively the "2024 Amendments"), the Company paid certain customary amendment fees to the lenders under the Credit Facility totaling approximately $ 4.5 million.

The Company performed an analysis of the 2024 Amendments under ASC Topic 470, Debt, and determined that debt modification accounting was appropriate for our term loan and revolving line of credit due to the change in total capacity and the increase in applicable margin interest rates under the new amendments.

As a result, the Company capitalized $ 4.3 million of the amendment fees as deferred loan fees which will be amortized over the remaining term of the Credit Facility and expensed the remaining $ 0.2 million of fees.

The summary descriptions of the Credit Agreement, the Security Agreement, the First Amendment, the Second Amendment and the Third Amendment do not purport to be complete and are qualified in their entirety by reference to the full text of each agreement, which are listed as exhibits to this Annual Report on Form 10-K.

During fiscal 2022, the Company expensed approximately $ 1.7 million of deferred financing charges related to the extinguishment of the Prior Credit Agreement on March 4, 2022.

These charges were recorded to interest expense, net and other on the Consolidated Statements of Operations and Comprehensive Loss for the year ended December 25, 2022.

On November 7, 2025, the Company entered into the fourth amendment to the Credit Agreement (the "Fourth Amendment").

The Fourth Amendment extended the maturity date of the Credit Agreement by six months to September 3, 2027.

In connection with the Fourth Amendment, the Company paid customary amendment fees to the lenders under the Credit Facility.

The Company performed an analysis of the Fourth Amendment under ASC Topic 470, Debt, and determined that debt modification accounting was appropriate.

As a result, the Company capitalized $ 1.0 million of the amendment fees as debt issuance costs, which will be amortized over the remaining term of the Credit Facility, and expensed the remaining $ 0.1 million of fees.

Approximately $ 0.5 million of the Fourth Amendment fees were paid-in-kind and added to the principal balance of the term loan.

The summary descriptions of the Credit Agreement, the Security Agreement, the First Amendment, the Second Amendment, the Third Amendment, and the Fourth Amendment do not purport to be complete and are qualified in their entirety by reference to the full text of each agreement, which are listed as exhibits to this Annual Report on Form 10-K.

Fair Value Measurements

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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 current liabilities approximate fair value due to the short-term nature or maturity of the instruments.

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

The Company maintains a rabbi trust to fund obligations under a deferred compensation plan.

Employee Benefit Programs.

Amounts in the rabbi trust are invested in mutual funds, which are designated as trading securities and carried at fair value and are included in other assets, net in the accompanying consolidated balance sheets.

Fair market value of mutual funds is measured using Level 1 inputs (quoted prices for identical assets in active markets).

The following tables present the Company's assets measured at fair value on a recurring basis as of December 29, 2024 and December 31, 2023 (in thousands):

December 29, 2024 Level 1 Level 2 Level 3

Investments in rabbi trust $ 1,821 $ 1,821 $ — $ —

Total assets measured at fair value $ 1,821 $ 1,821 $ — $ —

December 31, 2023 Level 1 Level 2 Level 3

Investments in rabbi trust $ 2,079 $ 2,079 $ — $ —

Total assets measured at fair value $ 2,079 $ 2,079 $ — $ —

Amounts in the rabbi trust are invested in mutual funds, which are designated as trading securities and carried at fair value and are included in prepaid expenses and other current assets in the accompanying Consolidated Balance Sheets.

The Company records equal and offsetting amounts to the deferred compensation plan assets for the Company's payment liabilities which are included in accrued liabilities and other in the accompanying Consolidated Balance Sheets.

The fair market value of mutual funds is measured using Level 1 inputs (quoted prices for identical assets in active markets), and were $ 1.9 million and $ 1.8 million as of December 28, 2025, and December 29, 2024, respectively.

Employee Benefit Programs for additional information.

Assets and Liabilities Measured at Fair Value on a Nonrecurring Basis

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These assets are measured at fair value if determined to be impaired.

During fiscal 2024, 2023, and 2022, the Company measured non-financial assets for impairment using continuing and projected future cash flows, as discussed in Note 4.

Impairment and Other Charges (Gains), net, which were based on significant inputs not observable in the market and thus represented a Level 3 fair value measurement.

Based on our fiscal 2024, 2023, and 2022 impairment analyses, we impaired long-lived assets at 58 , 19 and 46 locations with carrying values of $ 71.3 million, $ 36.5 million, and $ 80.4 million, respectively.

We determined the fair value of these long-lived assets in fiscal 2024, 2023, and 2022 to be $ 39.4 million, $ 27.4 million and $ 42.4 million, respectively, based on Level 3 fair value measurements.

During fiscal years 2025, 2024, and 2023, the Company measured non-financial assets for impairment using continuing and projected future cash flows, as discussed in Note 4.

Other (Gains) Charges, net which were based on significant inputs not observable in the market and thus represented a Level 3 fair value measurement.

Based on our fiscal years 2025, 2024, and 2023 impairment analyses, we impaired long-lived assets at 4 , 58 and 19 locations with carrying values of $ 6.1 million, $ 71.3 million, and $ 36.5 million, respectively.

We determined the fair value of these long-lived assets in fiscal years 2025, 2024, and 2023 to be $ 3.4 million, $ 39.4 million and $ 27.4 million, respectively, based on Level 3 fair value measurements.

Liquor licenses with indefinite lives are reviewed for impairment annually or whenever events or changes in circumstances indicate the carrying amount may not be recoverable.

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We determine fair value based on quoted prices in the active market for the license in the same or similar jurisdictions, representing a Level 1 fair value measurement.

During the fourth quarter of fiscal 2024, the Company performed its annual review of its indefinite lived liquor licenses that had a carrying value of $ 5.2 million, and recorded impairment charges of $ 1.1 million to indefinite-lived intangibles in fiscal 2024.

Impairment charges of $ 0.2 million were recorded to liquor licenses with indefinite lives in fiscal 2023 and $ 0.5 million impairment charges were recorded in fiscal 2022.

During the fourth quarter of fiscal 2025, the Company performed its annual review of its indefinite lived liquor licenses that had a carrying value of $ 4.0 million, resulting in no impairment recorded.

Impairment charges of $ 1.1 million and $ 0.2 million were recorded to liquor licenses with indefinite lives in fiscal years 2024 and 2023, respectively.

Disclosures of Fair Value of Other Assets and Liabilities

The Company's liability under its Credit Facility is carried at historical cost in the accompanying consolidated balance sheets.

As of December 29, 2024, the fair value of the Credit Facility was approximately $ 186.6 million and the principal amount carrying value was $ 189.5 million.

The Credit Facility term loan is reported net of $ 7.8 million in unamortized discount and debt issuance costs in the consolidated balance sheet as of December 29, 2024.

The carrying value approximated the fair value of the Credit Facility as of December 31, 2023, as the interest rate on the instrument approximated current market rates.

The interest rate on the Credit Facility represents a Level 2 fair value input.

The Company's finance and operating lease assets and liabilities as of December 29, 2024 and December 31, 2023 as follows (in thousands):

The carrying value of our variable rate Credit Facility, which utilized level 2 fair value inputs, approximated fair value as of December 28, 2025 and December 29, 2024, as such debt bears interest at floating rates which approximate market rates.

The Company's finance and operating lease assets and liabilities as of December 28, 2025 and December 29, 2024 were as follows (in thousands):

December 28, 2025 Finance (1)

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Total $ 7,765 $ 395,718

(1) Finance lease assets and obligations are included in Other assets, net, Accrued liabilities and other current liabilities, and Other non-current liabilities on our December 29, 2024 and December 31, 2023 Consolidated Balance Sheets.

(2) Operating lease assets and obligations are included in Operating lease assets, net, Current portion of operating lease liabilities, and Long-term portion of operating lease liabilities on our December 29, 2024 and December 31, 2023 Consolidated Balance Sheets.

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 consolidated statements of operations and comprehensive loss as follows (in thousands):

(1) Finance lease assets and obligations are included in other assets, net, accrued liabilities and other, and other non-current liabilities within our Consolidated Balance Sheets.

(2) Operating lease assets and obligations are included in operating lease assets, net, current portion of operating lease liabilities, and long-term portion of operating lease liabilities within our Consolidated Balance Sheets.

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 Consolidated Statements of Operations and Comprehensive Income (Loss) are as follows (in thousands):

December 28, 2025 December 29, 2024 December 31, 2023

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Total lease costs $ 94,799 $ 95,510 $ 93,657

(1) Amortization of finance lease right of use assets is recorded to depreciation and amortization in our Consolidated Statements of Operations and Comprehensive Loss.

(2) Interest on finance lease liabilities is recorded to interest expense in our Consolidated Statements of Operations and Comprehensive Loss.

(1) Amortization of finance lease right of use assets is recorded to depreciation and amortization in our Consolidated Statements of Operations and Comprehensive Income (Loss).

(2) Interest on finance lease liabilities is recorded to interest expense in our Consolidated Statements of Operations and Comprehensive Income (Loss).

Maturities of our lease liabilities as of December 28, 2025 were as follows (in thousands):

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Present value of lease liability $ 6,738 $ 349,166

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

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

December 28, 2025 December 29, 2024 December 31, 2023

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Weighted average discount rate 4.83 % 4.85 % 4.87 %

Loss before income taxes includes the following components for the fiscal years ended December 29, 2024, December 31, 2023, and December 25, 2022 (in thousands):

Income (loss) before income taxes included the following components for the fiscal years ended December 28, 2025, December 29, 2024, and December 31, 2023 (in thousands):

2025 2024 2023

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Foreign ( 7 ) 10 ( 24 )

Loss before income taxes $ ( 77,631 ) $ ( 20,918 ) $ ( 78,136 )

Income tax expense (benefit) for the fiscal years ended December 29, 2024, December 31, 2023, and December 25, 2022 consist of the following (in thousands):

Income (loss) before income taxes

$ ( 23,026 ) $ ( 77,631 ) $ ( 20,918 )

Income tax (benefit) expense included the following components for the fiscal years ended December 28, 2025, December 29, 2024, and December 31, 2023 (in thousands):

2025 2024 2023

Federal $ ( 11 ) $ ( 37 ) $ 37

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Foreign — — —

Total current income tax expense (benefit) $ ( 90 ) $ 310 $ 747

Total current income tax (benefit) expense

$ 258 $ ( 90 ) $ 310

Federal $ — $ — $ —

Foreign — — —

Total deferred income tax expense (benefit) — — —

Income tax expense (benefit), net $ ( 90 ) $ 310 $ 747

The reconciliation between the income tax expense (benefit) and the amount of income tax computed by applying the U.S.

federal statutory rate to loss before income taxes as shown in the accompanying Consolidated Statements of Operations and Comprehensive Loss for fiscal years ended December 29, 2024, December 31, 2023, and December 25, 2022 is as follows:

Total deferred income tax (benefit) expense

Income tax (benefit) expense, net

$ 258 $ ( 90 ) $ 310

The reconciliation between the income tax (benefit) expense and the amount of income tax computed by applying the U.S.

federal statutory rate to income (loss) before income taxes as shown in the accompanying Consolidated Statements of Operations and Comprehensive Income (Loss) for fiscal years ended December 28, 2025, December 29, 2024, and December 31, 2023 were as follows:

2025 2024 2023

Amount % Amount % Amount %

Tax provision at U.S.

federal statutory rate $ ( 4,835 ) 21.0 % $ ( 16,257 ) 21.0 % $ ( 4,382 ) 21.0 %

State income taxes 3.8 4.2 4.0

Valuation allowance on deferred income tax assets ( 25.6 ) ( 22.3 ) ( 24.2 )

Excess stock options ( 0.8 ) ( 3.3 ) ( 1.1 )

State and local income tax, net of federal (national) income tax effect (1)

220 ( 1.0 ) ( 512 ) 0.7 ( 15 ) 0.1

Foreign tax effects

317 ( 1.4 ) ( 586 ) 0.8 121 ( 0.6 )

Changes in valuation allowance

3,512 ( 15.2 ) 14,321 ( 18.6 ) 2,868 ( 13.8 )

Nontaxable or nondeductible items

546 ( 2.4 ) 621 ( 0.8 ) 698 ( 3.3 )

Other 498 ( 2.1 ) 2,323 ( 3.0 ) 1,020 ( 4.9 )

Effective tax rate $ 258 ( 1.1 ) % $ ( 90 ) 0.1 % $ 310 ( 1.5 ) %

The Company's federal and state deferred taxes at December 29, 2024 and December 31, 2023 are as follows (in thousands):

(1) State taxes in California, Colorado, Illinois, Oregon, and Texas made up the majority (greater than 50%) of the tax effect in this category.

The Company's federal and state deferred taxes as of December 28, 2025 and December 29, 2024 were as follows (in thousands):

Deferred tax assets:

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The Company had net operating loss carryforwards for tax purposes of $ 50.3 million as of December 28, 2025.

This is comprised of approximately $ 22.7 million of federal net operating loss carryovers, approximately $ 19.3 million of state net operating loss carryovers, and approximately $ 8.7 million of foreign net operating loss carryovers.

This was comprised of approximately $ 21.4 million of federal net operating loss carryovers, approximately $ 19.8 million of state net operating loss carryovers, and approximately $ 9.1 million of foreign net operating loss carryovers.

The federal net operating loss has an indefinite carryforward period, the state net operating loss carryovers expire at various dates between 2026 and 2046, and the foreign net operating loss carryovers expire at various dates between 2036 and 2046.

As of December 28, 2025, the Company had a deferred tax asset of $ 39.7 million related to federal tax credits, which expire at various dates between 2026 and 2040.

The Company also had a deferred tax asset of $ 1.2 million related to state tax credits which expire in 2025.

The Company establishes a valuation allowance to reduce the carrying amount of deferred income tax assets when it is more likely than not that it will not realize some portion or all the tax benefit of its deferred income tax assets.

The realization of deferred tax assets depends on the generation of future taxable income during the periods in which the temporary differences become deductible.

In making this determination, the Company considers all available positive and negative evidence including

historical operating losses, the reversal of deferred income tax liabilities, projected future taxable income, and tax planning strategies.

In making this determination, the Company considers all available positive and negative evidence including historical operating losses, the reversal of deferred income tax liabilities, projected future taxable income, and tax planning strategies.

In 2020, management determined that a full valuation allowance was required and has recorded a full valuation allowance as of December 28, 2025 and at December 29, 2024.

Based on the Company's evaluation of its deferred tax assets, a valuation allowance of approximately $ 136.6 million has been recorded against the deferred tax asset for federal and state tax credits, federal and state deferred tax assets, all net operating loss carry forwards and the deferred taxes of our foreign subsidiary.

The following table summarizes the Company's unrecognized tax benefits at December 29, 2024, December 31, 2023, and December 25, 2022 (in thousands):

Based on the Company's evaluation of its deferred tax assets, a valuation allowance of approximately $ 141.1 million had been recorded against the deferred tax asset for federal and state tax credits, federal and state deferred tax assets, all net operating loss carry forwards and the deferred taxes of our foreign subsidiary.

The following table summarizes the Company's unrecognized tax benefits as of December 28, 2025, December 29, 2024, and December 31, 2023 (in thousands):

2025 2024 2023

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The Company does not anticipate significant changes in the aggregate amount of unrecognized tax benefits within the next 12 months, other than nominal tax settlements.

The Company expects the unrecognized tax benefits to reduce to zero during 2025.

The following table summarizes the Company's net cash paid (refunds received) for income taxes, which consisted of the following as of December 28, 2025, December 29, 2024, and December 31, 2023 (in thousands):

2025 2024 2023

$ 72 $ 21 $ 50

Aggregated state and local jurisdictions

Disaggregated state and local jurisdictions

( 293 ) ( 191 ) —

Net (refunds received) cash paid for income taxes

$ ( 30 ) $ 83 $ 454

Commitments and Contingencies

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However, the ultimate resolution of litigated claims may differ from our current estimates.

In the normal course of business, there are various claims in process, matters in litigation, administrative proceedings, and other contingencies, certain of which are covered by insurance policies.

These include employment related claims and class action lawsuits, claims from Guests or Team Members alleging illness, injury, food quality, health, or operational concerns, and lease and other commercial disputes.

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 financial statements and that the ultimate resolution of pending or threatened matters will not have a material adverse effect on our financial position and results of operations.

However, a significant increase in the number of these claims, or one or more successful claims resulting in greater liabilities than we currently anticipate, could materially and adversely affect our business, financial condition, results of operations, and cash flows.

As of December 29, 2024, we had reserves of $ 4.4 million for loss contingencies included within Accrued liabilities and other on our Consolidated Balance Sheet.

As of December 28, 2025, we had reserves of $ 5.5 million for loss contingencies included within accrued liabilities and other on our Consolidated Balance Sheets.

We increased our estimate of loss contingency liabilities by approximately $ 1.1 million for the year ended December 28, 2025 related to ongoing legal matters.

In the normal course of business, there are various claims in process, matters in litigation, administrative proceedings, and other contingencies.

These include employment related claims and class action lawsuits, claims from guests or team members alleging illness, injury, food quality, health, or operational concerns, and lease and other commercial disputes.

We recorded estimated loss contingency reserves of approximately $ 1.0 million for the year ended December 29, 2024 related to ongoing litigation matters.

However, a significant increase in the number of these claims, or one or more successful claims resulting in greater liabilities than we currently anticipate, could materially and adversely impact our business, financial condition, results of operations, and cash flows.

We ultimately may be subject to greater or less than the accrued amount for this and other matters.

As of December 29, 2024, we had non-cancellable purchase commitments primarily related to certain vendors who provide food and beverages and other supplies to our restaurants, for an aggregate of $ 142.1 million.

As of December 28, 2025, we had non-cancellable purchase commitments primarily related to certain vendors who provide food and beverage and other supplies to our restaurants, for an aggregate of $ 214.5 million.

We expect to fulfill our commitments under these agreements in the normal course of business, and as such, no liability has been recorded.

Stockholders' Deficit

The Company has a potential contingent lease liability for lease payments related to certain franchisees' lease arrangements.

The maximum amount of potential future payments under the potential contingent lease liability was $ 3.0 million and $ 3.8 million as of December 28, 2025 and December 29, 2024, respectively.

The Company does not believe these arrangements have or are likely to have a material effect on its results of operations, financial condition, revenues or expenses, capital expenditures or liquidity.

Stockholders' Equity ( Deficit)

On November 10, 2025, the Company entered into a distribution agreement (the "Distribution Agreement") with Evercore Group L.L.C.

("Evercore") to establish an "at-the-market equity offering" program ("ATM Program"), pursuant to which the Company may offer and sell, from time to time, through Evercore, shares of the Company’s common stock, par value $ 0.001 per share, having an aggregate offering price of up to $ 40.0 million.

As of December 28, 2025, the Company had not issued or sold any shares under the ATM Program, which the Company voluntarily terminated on February 23, 2026.

The cost to establish this program was $ 0.5 million, comprised of legal and other regulatory fees, and is included in the proceeds from issuance of common stock, net of stock issuance costs of the Consolidated Statements of Cash Flows.

On December 3, 2024 the Company entered into an Equity Purchase Agreement with JCP Investment Management, LLC and certain of its affiliates (collectively, "JCP") and Jumana Capital, LLC and certain of its affiliates (collectively, "Jumana," and together with the JCP Parties, the "Investor Parties"), pursuant to which the Investor Parties purchased an aggregate of 1,600,909 shares of Common Stock, at a purchase price of $ 5.19 per share, resulting in $ 8.3 million in gross proceeds.

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Following the date of approval, all grants are made under the 2024 Stock Plan and no new awards may be granted under the Second Amended and Restated 2017 Performance Incentive Plan (the "2017 Stock Plan").

The 2024 Stock Plan authorizes the issuance of stock options, stock appreciation rights (SARs), and other forms of awards granted or denominated in the Company common stock or unit of the Company's common stock, as well as cash performance awards pursuant to the plan.

Persons eligible to receive awards under the 2024 Stock Plan include officers, employees, directors, consultants, and other service providers or any affiliate of the Company.

The 2024 Stock Plan authorizes the issuance of stock options, stock appreciation rights, restricted stock units, performance stock units, and other forms of awards granted or denominated in the Company common stock or unit of the Company's common stock, as well as cash performance awards pursuant to the plan.

Persons eligible to receive awards under the 2024 Stock Plan include officers, employees, directors, consultants, contractors, and other service providers or any affiliate of the Company.

The maximum number of shares of the Company's common stock that may be issued or transferred pursuant to awards granted under the 2024 Stock Plan is 2,072,163 shares.

Vesting of the awards under the 2024 Stock Plan is determined at the date of grant by the plan administrator.

Each award granted under the 2024 Stock Plan and the 2017 Stock Plan may become exercisable and/or payable, as applicable, upon a change in control event described in the applicable Stock Plan.

Each award expires on such date as shall be determined at the date of grant;

however, the maximum term of options, SARs, and other rights to acquire common stock under the plan is ten years after the initial date of the award, subject to provisions for further deferred payment in certain circumstances.

Vesting of awards under these plans were generally time based over a period of one year to four years .

As of December 28, 2025, 253,675 and 2,227,091 options and awards to acquire the Company's common stock remained outstanding under the 2017 Stock Plan and the 2024 Stock Plan, respectively.

all remaining options and awards are outstanding under the 2024 Stock Plan.

Stock-based compensation costs recognized in fiscal 2024, 2023, and 2022 were $ 6.9 million, $ 6.8 million, and $ 6.3 million with related income tax benefits of $ 0.5 million, $ 0.8 million, and $ 0.6 million.

The fiscal 2022 costs were comprised of $ 9.6 million stock-based compensation, partially offset by a $ 3.3 million reduction due to Executive Team forfeitures recorded in Impairment and other charges in the Consolidated Statements of Operations and Comprehensive Loss.

Stock-based compensation costs recognized in general and administrative for fiscal years 2025, 2024, and 2023 were $ 5.6 million, $ 6.9 million, and $ 6.3 million, respectively.

Total stock-based compensation costs, inclusive of amounts recognized in labor and other (gains) charges, net for fiscal years 2025, 2024, and 2023 were $ 1.5 million, $ 7.0 million, and $ 6.9 million, respectively, with related income tax benefits of $ 0.6 million, $ 0.5 million, and $ 0.8 million, respectively.

As of December 28, 2025, there was $ 4.9 million of unrecognized compensation cost, excluding estimated forfeitures.

Unrecognized compensation costs are expected to be recognized over the weighted average remaining vesting period of approximately one year for the restricted stock units ("RSU") and 1.62 years for the performance stock units ("PSU").

Unrecognized compensation costs are expected to be recognized over the weighted average remaining vesting period of approximately 0.73 years for the restricted stock units ("RSU") and 1.90 years for the performance stock units ("PSU").

There is no unrecognized compensation cost for stock options in the year ended December 28, 2025.

Stock Options

The tables below summarize the status of the Company's stock option plans (in thousands, except exercise price):

Stock Options

Shares Weighted Average Exercise Price

Outstanding, December 31, 2023

Forfeited/expired ( 36 ) 63.63

Exercised — —

Outstanding, December 29, 2024

Shares Weighted

Price Weighted

Life Aggregate

Intrinsic Value

Outstanding as of December 29, 2024

81 $ 61.75 1.26 $ —

Vested and expected to vest as of December 29, 2024 (1)

81 $ 61.75 1.26 $ —

Exercisable as of December 29, 2024

81 $ 61.75 1.26 $ —

———————————————————

(1) The expected to vest options are the result of applying the pre-vesting forfeiture rate assumption to total outstanding options.

The Company applies estimated forfeiture rates that are derived from our historical forfeitures of similar awards.

The estimated fair value of each option granted is calculated using the Black-Scholes multiple option-pricing model, and expense is recognized straight line over the vesting period.

No options were granted during fiscal 2024, 2023, or 2022.

Total intrinsic value of options exercised was $ 0 , $ 213 thousand, and $ 4 thousand in fiscal 2024, 2023, and 2022, respectively.

Time-Based RSUs

During fiscal 2024, 2023, and 2022, the Company issued time-based restricted stock units ("RSUs") to certain participants as permitted under the 2017 Stock Plan and the 2024 Stock Plan.

During fiscal years 2025, 2024, and 2023, the Company issued time-based restricted stock units ("RSUs") to certain participants.

The RSUs granted to employees typically vest in equal installments over three to four years .

For the Company's non-employee directors, under the 2024 Stock Plan, RSUs vest in full on the later of fifty weeks following the date of grant and the Company's next annual meeting of stockholders.

For the Company's non-employee directors, RSUs vest in full on the later of fifty weeks following the date of grant and the Company's next annual meeting of stockholders.

Upon vesting, one share of the Company's common stock is issued for each RSU.

The fair value of each RSU granted is equal to the market price of the Company's stock at the date of grant, and expense is recognized straight line over the vesting period.

The table below summarizes the status of the Company's time-based RSUs under the 2017 Stock Plan and 2024 Stock Plan (shares in thousands):

The table below summarizes the activity of the Company's time-based restricted stock units (shares in thousands):

Restricted Stock Units

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Outstanding, December 28, 2025

(1) Awards expected to vest are the result of applying the pre-vesting forfeiture rate assumption to total outstanding awards.

The Company applies estimated forfeiture rates that are derived from our historical forfeitures of similar awards.

Performance Stock Units

During fiscal 2024, 2023, and 2022, the Company granted performance stock unit awards ("PSUs") to certain employees as permitted under the 2017 Stock Plan and the 2024 Stock Plan.

Each PSU represents the right to receive one share of the Company's common stock on the payment date.

During fiscal years 2025, 2024, and 2023, the Company granted performance-based stock unit awards ("PSUs") to certain employees.

Each PSU represents the right to receive one share of the Company's common stock on the vesting date.

The PSU awards use a performance metric based on relative total stockholder return defined as increases in the Company's stock price during a performance period of three years as compared to the total stockholder return of a group of peer companies.

Fair value of each PSU granted is determined by a Monte Carlo valuation model, and expense is recognized straight line over the performance period.

Expense is recorded to general and administrative expenses on a straight-line basis over the performance period based on the fair value of shares as determined by a Monte Carlo simulation on the grant date.

PSUs remain unvested until the last day of the three-year performance period and are generally forfeited in the event of termination of employment of a grantee prior to the last day of the three-year performance period.

If the relative total stockholder return target is not met, compensation cost for these PSUs is not reversed.

The table below summarizes the status of the Company's performance stock units under the 2017 Stock Plan and the 2024 Stock Plan (shares in thousands):

If the relative total stockholder return target is not met, then the compensation cost for these PSUs is not reversed.

The table below summarizes the activity of the Company's performance stock units (shares in thousands):

Performance Stock Units

4 unchanged sentences

Outstanding, December 28, 2025

(1) Awards expected to vest are the result of applying the pre-vesting forfeiture rate assumption to total outstanding awards.

The Company applies estimated forfeiture rates that are derived from our historical forfeitures of similar awards.

Inducement Grants

In prior years, the Company granted stock-based awards to certain of the Company’s new executive officers as inducements material to their commencement of employment and entry into an employment agreement with the Company.

The inducement grants were made in accordance with Nasdaq Listing Rule 5635(c)(4) and were not made under the 2017 Plan.

The inducement grants, which include PSU and RSU awards, are generally subject to substantially the same terms and conditions as grants that are made under the 2017 Plan and fair value is determined in the same manner as described for each grant type above.

The table below summarizes the status of the Company' inducement grants (shares in thousands):

Restricted Stock Units Performance Stock Units

Shares Weighted Average Grant-Date Fair Value (per share) Shares Weighted Average Grant-Date Fair Value (per share)

Outstanding, December 31, 2023

The fair value of PSUs was estimated on the grant date using a Monte Carlo simulation model with the following assumptions:

Fiscal Year of Grant

2025 2024 2023

Volatility 66.8 % 66.2 % 76.1 %

Risk-free interest rate 4.0 % 4.8 % 3.8 %

Expected life (years) 2.60 2.60 2.78

Fair value of market-based awards granted $ 3.38 $ 9.11 $ 18.95

Phantom Performance Stock Units

During fiscal 2025, the Company granted phantom performance stock unit awards ("PPSUs") to certain employees.

Each PPSU represents the right to receive either one share of the Company's common stock upon vesting or the cash equivalent on that date.

The PPSUs use a performance metric based on relative total stockholder return defined as increases in the Company's

stock price during a performance period of three years as compared to the total stockholder return of a group of peer companies.

PPSUs remain unvested until the last day of the three-year performance period and are generally forfeited in the event of termination of employment of a grantee prior to the last day of the three-year performance period.

The option to settle the PPSUs in common stock or cash upon vesting is at the sole discretion of the Company.

While the Company may opt to settle any earned PPSUs with common stock, as of December 28, 2025, the PPSUs were liability-classified awards due to the lack of available shares under the 2024 Stock Plan.

The PPSUs are included within other non-current liabilities on the Company's Consolidated Balance Sheets.

The fair value of each PPSU granted is determined using a Monte Carlo valuation model and is remeasured at each reporting date until settlement.

Compensation expense is recognized or reversed on each remeasurement date based on the change in fair value of the PPSUs between remeasurement periods, pro-rated based on the remaining term to vest.

The table below summarizes the status of the Company's phantom performance stock units under the 2024 Stock Plan (shares in thousands):

Phantom Performance Stock Units

Shares Weighted Average Grant-Date Fair Value (per share)

Outstanding, December 29, 2024

Awarded 477 8.40

Forfeited ( 190 ) 8.40

Vested ( 63 ) 7.57 — —

Outstanding, December 28, 2025

The following table summarizes the key inputs and valuation assumptions used in determining the fair value of the Company’s PPSU awards as of December 28, 2025:

Fiscal Year of Grant

2025 2024 2023

(1) Awards expected to vest are the result of applying the pre-vesting forfeiture rate assumption to total outstanding awards.

The Company applies estimated forfeiture rates that are derived from our historical forfeitures of similar awards.

Volatility 77.9 % N/A N/A

Risk-free interest rate 3.5 % N/A N/A

Expected life (years) 2.01 N/A N/A

Fair value of market-based awards granted $ 6.13 N/A N/A

Long-Term Cash Incentive Plan

Beginning in 2020, the long-term cash incentive plan is based on relative total stockholder return defined as increases in the Company's stock price during a performance period of 3 years as compared to the total stockholder return of a group of peer companies.

Compensation is recognized variably over the 3 -year performance period based on a Monte Carlo valuation model.

Beginning in 2017, the long-term cash incentive plan was based on operational metrics with three-year performance periods.

Compensation expense for awards granted before 2020 is recognized variably over the performance period based on the plan-to-date performance achievement.

Beginning in 2020, the long-term cash incentive plan is based on relative total stockholder return defined as increases in the Company's stock price during a performance period of three years as compared to the total stockholder return of a group of peer companies.

Compensation expense is recognized variably over the 3 -year performance period.

All long-term cash incentive awards cliff vest after three years at the end of each performance cycle.

In fiscal years 2024, 2023, and 2022, the Company recorded $( 0.1 ) million, $( 0.1 ) million, and $( 0.4 ) million, respectively in compensation expense (benefit) to Selling, general, and administrative expenses in the consolidated

statements of operations and comprehensive loss related to the 2017 long-term cash incentive plan.

The amounts recorded in fiscal 2024 and fiscal 2023 include the reversal of the expense related to 2021 and 2020 grants for which performance targets were not met.

During fiscal 2024 and 2023, there were no long-term cash incentive plan payouts.

In fiscal years 2025, 2024, and 2023, the Company recorded $( 0.1 ) million, $( 0.1 ) million, and $( 0.1 ) million, respectively, in compensation (benefit) expense to general and administrative expenses in the Consolidated Statements of Operations and Comprehensive Income (Loss) related to the 2020 long-term cash incentive plan.

The amounts recorded in fiscal years 2025, 2024, and 2023 included the reversal of the expense related to 2023, 2022, and 2021 grants for which performance targets were not fully achieved.

During fiscal years 2025 and 2024, there were no long-term cash incentive plan payouts.

At December 28, 2025 and December 29, 2024, a $ 0.2 million and $ 0.3 million long-term cash incentive plan liability was included in accrued payroll and payroll-related liabilities on the Consolidated Balance Sheets.

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Employee Deferred Compensation Plan

The Company offers a deferred compensation plan that permits key employees and other members of management defined as highly compensated employees under the IRS code to defer portions of their compensation in a pre-tax savings vehicle that allows for retirement savings above 401(k) limits.

Under this plan, eligible Team Members may elect to defer up to 75 % of their base salary and up to 100 % of variable compensation and commissions each plan year.

The assets of the deferred compensation plan are held in a rabbi trust, where they are invested in certain mutual funds that cover an investment spectrum ranging from equities to money market instruments and are available to satisfy the claims of the Company's creditors in the event of bankruptcy or insolvency.

In fiscal 2025 and prior years, the Company offered a deferred compensation plan that permitted key employees and other members of management defined as highly compensated employees under the IRS code to defer portions of their compensation in a pre-tax savings vehicle that allows for retirement savings above 401(k) limits.

Under this plan, eligible team members could elect to defer up to 75 % of their base salary and up to 100 % of variable compensation and commissions each plan year.

The Company terminated its deferred compensation plan effective October 23, 2025, with no new deferral election allowed.

All assets will be fully distributed by the end of fiscal 2026.

Given the termination of the deferred compensation plan

and scheduled distribution within the next fiscal year, the plan's assets and liabilities have been classified as current in the December 28, 2025 Consolidated Balance Sheets.

The assets of the deferred compensation plan are currently held in a rabbi trust, where they are invested in certain mutual funds that cover an investment spectrum ranging from equities to money market instruments and are available to satisfy the claims of the Company's creditors in the event of bankruptcy or insolvency.

These mutual funds have published market prices and are reported at fair value.

Fair Value Measurements.

Changes in the market value of the investments held in the trust result in the recognition of a corresponding gain or loss reported in Interest income and other, net in the Consolidated Statements of Operations and Comprehensive Loss.

A corresponding change in the liability associated with the deferred compensation plan results in an offsetting deferred compensation expense, or reduction of expense, reported in Selling, general, and administrative expenses in the Consolidated Statements of Operations and Comprehensive Loss.

The Company recognized $ 0.3 million, $ 0.4 million, and $ 0.8 million in deferred compensation expense in fiscal 2024, fiscal 2023 and fiscal 2022, respectively.

As of December 29, 2024 and December 31, 2023, $ 1.7 million and $2.1 million of deferred compensation assets are included in Other assets, net, in the accompanying Consolidated Balance Sheets.

As of December 29, 2024 and December 31, 2023, $ 0.1 million and $ 0.4 million of this deferred compensation is included in Prepaid expenses and other current assets in the accompanying Consolidated Balance Sheets.

As of December 29, 2024 and December 31, 2023, $ 1.7 million and $ 1.7 million of deferred compensation plan liabilities are included in Other non-current liabilities in the accompanying Consolidated Balance Sheets.

As of December 29, 2024, and December 31, 2023, $ 0.1 million and $ 0.4 million of this deferred compensation is included in Accrued liabilities and other in the accompanying Consolidated Balance Sheets.

Changes in the market value of the investments held in the trust result in the recognition of a corresponding gain or loss reported in interest (income) and other, net in the Consolidated Statements of Operations and Comprehensive Income (Loss).

A corresponding change in the liability associated with the deferred compensation plan results in an offsetting deferred compensation expense, or reduction of expense, reported in General and administrative expenses in the Consolidated Statements of Operations and Comprehensive Income (Loss).

As of December 28, 2025 and December 29, 2024, $ 0.0 million and $ 1.7 million of deferred compensation assets were included in Other assets, net, in the accompanying Consolidated Balance Sheets.

As of December 28, 2025 and December 29, 2024, $ 1.9 million and $ 0.1 million of this deferred compensation was included in Prepaid expenses and other current assets in the accompanying Consolidated Balance Sheets.

As of December 28, 2025 and December 29, 2024, $ 0.0 million and $ 1.7 million of deferred compensation plan liabilities were included in Other non-current liabilities in the accompanying Consolidated Balance Sheets.

As of December 28, 2025, and December 29, 2024, $ 1.9 million and $ 0.1 million of this deferred compensation was included in Accrued liabilities and other in the accompanying Consolidated Balance Sheets.

Employee Stock Purchase Plan

In July 2017, the Company adopted the Amended and Restated Employee Stock Purchase Plan (the "ESPP Plan").

The ESPP Plan authorized 100,000 shares of the Company's common stock for issuance.

In May 2020, our Board of Directors authorized the issuance of an additional 150,000 shares of the Company's common stock under the ESPP Plan.

In December 2022, our Board of Directors authorized, and at our 2023 Annual Meeting of Stockholders, our stockholders approved, the issuance of an additional 350,000 shares of the Company's common stock under the ESPP Plan increasing the shares authorized to be granted under the ESPP Plan to a total of 600,000 shares.

Under the ESPP Plan, eligible Team Members may voluntarily contribute up to 15 % of their salary, subject to limitations, to purchase common stock at a price equal to 85 % of the fair market value of a share of the Company's common stock on the first day of each offering period or 85 % of the fair market value of a share of the Company's common stock on the last day of each offering period, whichever amount is less.

In general, all of the Company's officers and Team Members who have been employed by the Company for at least one year and who are regularly scheduled to work more than 20 hours per week are eligible to participate in this plan, which operates in the successive six months commencing on January 1 and July 1 of each fiscal year.

As of December 28, 2025, there were 600,000 shares authorized to be granted under the Amended and Restated Employee Stock Purchase Plan (the "ESPP Plan").

During fiscal 2025, the Company issued a total of 105,534 shares under the ESPP Plan with 121,269 shares available for future issuance.

During fiscal 2024, the Company issued a total of 42,592 shares under the ESPP Plan.

For fiscal 2024, in accordance with the guidance for accounting for stock compensation, the Company estimated the fair value of the awards granted pursuant to the stock purchase plan using the Black-Scholes multiple-option pricing model.

The assumptions used in the model included risk-free interest rates from 5.03 % to 3.98 %, 0.5 year expected life, expected volatilities from 55.25 % to 55.76 %, and 0 % dividend yield.

The weighted average fair value per share at grant date was $ 0.93 .

For fiscal 2023, the assumptions used in the model included 5.46 % risk-free interest rate, 0.5 year expected life, expected volatility of 55.25 %, and 0 % dividend yield.

The weighted average fair value per share at grant date was $ 1.72 .

For fiscal 2022, the assumptions used in the model included 4.05 % risk-free interest rate, 0.5 year expected life, expected volatility of 55.00 %,

and 0 % dividend yield.

The weighted average fair value per share at grant date was $ 0.99 .

The Company recognized $ 0.1 million of compensation expense related to this plan in fiscal 2024, $ 0.1 million in fiscal 2023, and $ 0.1 million in fiscal 2022.

Under the ESPP Plan, eligible team members may voluntarily contribute up to 15 % of their salary, subject to limitations, to purchase common stock at a price equal to 85 % of the fair market value of a share of the Company's common stock on the first day of each offering period or 85 % of the fair market value of a share of the Company's common stock on the last day of each offering period, whichever amount is less.

In general, all of the Company's officers and team members who have been employed by the Company for at least one year and who are regularly scheduled to work more than 20 hours per week are eligible to participate in this plan, which operates in the successive six-month periods commencing on January 1 and July 1 of each fiscal year.

For fiscal 2025, in accordance with the guidance for accounting for stock compensation, the Company estimated the fair value of the shares granted pursuant to the stock purchase plan using the Black-Scholes multiple-option pricing model based on the following assumptions:

2025 2024 2023

Risk-free interest rate 3.79 % 5.03 % 5.46 %

Expected life in years 0.50 0.50 0.50

Expected volatility 57.47 % 55.76 % 55.25 %

Dividend yield — % — % — %

Weighted average fair value per share at grant date $ 0.92 $ 0.93 $ 1.72

Employee Defined Contribution Plan

3 unchanged sentences

In addition, the Company may contribute each period, at its discretion, an additional amount from profits.

Employer matching contributions equal to 100 % of the first 3 % of compensation and 50 % on the next 2 % of compensation.

In fiscal 2025, the Company made matching contributions in an amount equal to 100 % of the first 3 % of an employee's compensation and 50 % on the next 2 % of compensation.

The Company matches contributions when the employee contribution is made, and the employer matching contributions are not subject to a vesting schedule.

The Company recognized matching contribution expense of $ 3.3 million in fiscal 2024, $ 3.0 million in fiscal 2023, and $ 2.9 million in fiscal 2022.

The Company recognized matching contribution expense of $ 3.3 million, $ 3.3 million, and $ 3.0 million in fiscal years 2025, 2024, and 2023 , respectively.

Acquisitions and Dispositions

As of December 29, 2024, the land and building assets at three owned restaurant locations were classified as held for sale.

These long-lived assets have a total carrying amount of $ 4.3 million as of December 29, 2024, and are included in Assets held for sale in our consolidated balance sheets.

As of December 28, 2025, the land and building assets at one owned restaurant location were classified as held for sale.

These long-lived assets had a total carrying amount of $ 2.3 million as of December 28, 2025, and were included in assets held

for sale in our Consolidated Balance Sheets.

We expect to close on the sale of these assets during the first quarter of fiscal 2026.

As the fair value of these assets is greater than their carrying amounts as of December 29, 2024, there is no gain or loss to record in our consolidated statements of operations and comprehensive loss until the transaction is closed.

During fiscal 2023, the Company acquired certain assets and liabilities of five restaurants from one of its U.S.

franchisees for cash consideration of $ 3.5 million.

The Company acquired $ 2.6 million of property and equipment, net, $ 0.8 million of operating lease liabilities, net of operating lease assets, $ 0.3 million of other assets, net of liabilities, and $ 1.4 million of intangible assets, net.

As the fair value of these assets was greater than their carrying amounts as of December 28, 2025, there was no gain or loss to record in our Consolidated Statements of Operations and Comprehensive Income (Loss) until the transaction is closed.

As of December 29, 2024, the land and building assets at three owned restaurant locations were classified as held for sale.

These long-lived assets had a total carrying amount of $ 4.3 million as of December 29, 2024, and were included in assets held for sale in our Consolidated Balance Sheets.

We closed on the sale of these assets during the first quarter of fiscal 2025, which resulted in a gain on sale of $ 1.1 million recorded in our Consolidated Statements of Operations and Comprehensive Income (Loss).

Segment Reporting

In accordance with Segment Reporting, the Company uses the management approach for determining its reportable segments.

In accordance with ASC 280 - Segment Reporting, the Company uses the management approach for determining its reportable segments.

The management approach is based upon the way that management reviews performance and allocates resources.

The Company has one operating and one reportable segment:

The Company had one operating and one reportable segment:

We manage our business activities on a consolidated basis, as Red Robin restaurants all have similar customers, sell similar products, and have a similar process to sell those products.

We primarily derive our revenue in the United States through the sale of food and beverage through its Company-owned locations as well as earn franchise fees from franchise restaurants.

The accounting policies of the restaurant segment are the same as those described in Note 1.

Description of Business and Summary of Significant Accounting Policies.

We primarily derive our revenue in the United States through the sale of food and beverage through our Company-owned locations as well as earn royalties and fees from franchise restaurants.

There have been no material changes to the accounting policies of the restaurant segment.

Our Chief Operating Decision Maker ("CODM") is our Chief Executive Officer.

The Company measures segment profit using consolidated net income (loss).

The CODM uses consolidated Net income (loss), as reported on our Consolidated Statements of Operations and Comprehensive Loss, in deciding whether to reinvest excess cash flow into the restaurant segment or into other parts of the Company.

The CODM uses consolidated net income (loss), as reported on our Consolidated Statements of Operations and Comprehensive Income (Loss), in deciding whether to reinvest excess cash flow into the restaurant segment or into other parts of the Company.

The CODM does not review assets in evaluating the results of the restaurant segment, and therefore, such information is not presented.

Financial information for the Company's reportable segment is as follows (in thousands):

December 29, 2024 December 31, 2023 December 25, 2022

Restaurant revenue $ 1,224,254 $ 1,274,294 $ 1,230,189

Franchise revenue 14,941 15,867 19,306

Other revenue 9,365 12,885 16,039

Total revenues 1,248,560 1,303,046 1,265,534

Costs and expenses:

Cost of sales

292,392 308,962 306,509

Labor 479,631 473,538 440,564

Other operating

216,242 224,999 224,704

Occupancy 103,359 102,761 98,868

General and administrative expenses 81,721 89,360 84,912

Selling 36,719 34,770 51,700

Other segment items (1)

33,848 ( 2,076 ) 39,529

Depreciation and amortization

57,729 66,190 76,245

Interest expense, net and other

24,550 25,460 20,639

Income tax expense (benefit)

( 90 ) 310 747

Segment net income (loss)

$ ( 77,541 ) $ ( 21,228 ) $ ( 78,883 )

(1) Other segment items consists primarily of impairment and other charges (gains) and pre-opening costs.

As Red Robin operated in one reportable operating segment, all required financial segment information is included in the Consolidated Financial Statements.

Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

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 8. Financial Statements and Supplementary Data