SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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SCHEDULE 13D
(Rule 13d-101)
INFORMATION TO BE INCLUDED IN STATEMENTS FILED PURSUANT
TO RULE 13d-1(a) AND AMENDMENTS THERETO FILED PURSUANT TO
RULE 13d-2(a)
Under the Securities Exchange Act of 1934
(Amendment No. )*
Red Robin Gourmet Burgers, Inc.
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(Name of Issuer)
Common Stock, Par Value $0.001 Per Share
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(Title of Class of Securities)
75689M101
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(CUSIP Number)
Marc Weingarten, Esq. and
David E. Rosewater, Esq.
Schulte Roth & Zabel LLP
919 Third Avenue
New York, New York 10022
(212) 756-2000
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(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
June 10, 2010
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(Date of Event which Requires
Filing of This Statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition that is the subject of this Schedule 13D, and is filing this
schedule because of Rule 13d-1(e), 13d-1(f) or 13d-1(g), check the following
box. [ ]
NOTE: Schedules filed in paper format shall include a signed original and five
copies of the schedule, including all exhibits. See Rule 13d-7 for other parties
to whom copies are to be sent.
(Continued on following pages)
(Page 1 of 14 Pages)
--------------------------
* The remainder of this cover page shall be filled out for a reporting person's
initial filing on this form with respect to the subject class of securities, and
for any subsequent amendment containing information which would alter
disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be deemed
to be "filed" for the purpose of Section 18 of the Securities Exchange Act of
1934 ("Act") or otherwise subject to the liabilities of that section of the Act
but shall be subject to all other provisions of the Act (however, see the
Notes).
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CUSIP NO. 75689M101 SCHEDULE 13D PAGE 2 OF 14 PAGES
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1 NAME OF REPORTING PERSON
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
CLINTON GROUP, INC.
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [X]
(b) [ ]
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3 SEC USE ONLY
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4 SOURCE OF FUNDS*
AF
-------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEMS 2(d) or 2(e) [ ]
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6 CITIZENSHIP OR PLACE OF ORGANIZATION
DELAWARE
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7 SOLE VOTING POWER
- 0 -
---------------------------------------------------------
NUMBER OF 8 SHARED VOTING POWER
SHARES
BENEFICIALLY 795,315 (See Item 6)
OWNED BY ---------------------------------------------------------
EACH 9 SOLE DISPOSITIVE POWER
REPORTING
PERSON WITH - 0 -
---------------------------------------------------------
10 SHARED DISPOSITIVE POWER
795,315 (See Item 6)
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11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH PERSON
795,315 (See Item 6)
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12 CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES*
[ ]
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13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
5.10% (See Item 6)
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14 TYPE OF REPORTING PERSON*
IA; CO
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CUSIP NO. 75689M101 SCHEDULE 13D PAGE 3 OF 14 PAGES
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1 NAME OF REPORTING PERSON
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
CLINTON MAGNOLIA MASTER FUND, LTD.
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [X]
(b) [ ]
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3 SEC USE ONLY
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4 SOURCE OF FUNDS*
WC
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5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEMS 2(d) or 2(e) [ ]
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6 CITIZENSHIP OR PLACE OF ORGANIZATION
CAYMAN ISLANDS
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7 SOLE VOTING POWER
- 0 -
---------------------------------------------------------
NUMBER OF 8 SHARED VOTING POWER
SHARES
BENEFICIALLY 741,615 (See Item 6)
OWNED BY ---------------------------------------------------------
EACH 9 SOLE DISPOSITIVE POWER
REPORTING
PERSON WITH - 0 -
---------------------------------------------------------
10 SHARED DISPOSITIVE POWER
741,615 (See Item 6)
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11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH PERSON
741,615 (See Item 6)
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12 CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES*
[ ]
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13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
4.75%(See Item 6)
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14 TYPE OF REPORTING PERSON*
CO
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* SEE INSTRUCTIONS
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CUSIP NO. 75689M101 SCHEDULE 13D PAGE 4 OF 14 PAGES
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1 NAME OF REPORTING PERSON
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
CLINTON SPECIAL OPPORTUNITIES MASTER FUND, LTD.
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [x]
(b) [ ]
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3 SEC USE ONLY
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4 SOURCE OF FUNDS*
WC
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5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEMS 2(d) or 2(e) [ ]
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6 CITIZENSHIP OR PLACE OF ORGANIZATION
CAYMAN ISLANDS
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7 SOLE VOTING POWER
- 0 -
---------------------------------------------------------
NUMBER OF 8 SHARED VOTING POWER
SHARES
BENEFICIALLY 50,000
OWNED BY ---------------------------------------------------------
EACH 9 SOLE DISPOSITIVE POWER
REPORTING
PERSON WITH - 0 -
---------------------------------------------------------
10 SHARED DISPOSITIVE POWER
50,000
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11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH PERSON
50,000
-------------------------------------------------------------------------------
12 CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES*
[ ]
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13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
0.32%
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14 TYPE OF REPORTING PERSON*
CO
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* SEE INSTRUCTIONS
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CUSIP NO. 75689M101 SCHEDULE 13D PAGE 5 OF 14 PAGES
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1 NAME OF REPORTING PERSON
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
GEORGE HALL
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [X]
(b) [ ]
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3 SEC USE ONLY
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4 SOURCE OF FUNDS*
AF
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5 CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEMS 2(d) or 2(e) [ ]
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6 CITIZENSHIP OR PLACE OF ORGANIZATION
UNITED STATES
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7 SOLE VOTING POWER
- 0 -
---------------------------------------------------------
NUMBER OF 8 SHARED VOTING POWER
SHARES
BENEFICIALLY 791,615 (See Item 6)
OWNED BY ---------------------------------------------------------
EACH 9 SOLE DISPOSITIVE POWER
REPORTING
PERSON WITH - 0 -
---------------------------------------------------------
10 SHARED DISPOSITIVE POWER
791,615 (See Item 6)
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11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH PERSON
791,615 (See Item 6)
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12 CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES*
[ ]
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13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
5.10% (See Item 6)
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14 TYPE OF REPORTING PERSON*
IN
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* SEE INSTRUCTIONS
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CUSIP NO. 75689M101 SCHEDULE 13D PAGE 6 OF 14 PAGES
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1 NAME OF REPORTING PERSON
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
SPOTLIGHT ADVISORS, LLC.
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [X]
(b) [ ]
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3 SEC USE ONLY
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4 SOURCE OF FUNDS*
WC
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5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEMS 2(d) or 2(e) [ ]
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6 CITIZENSHIP OR PLACE OF ORGANIZATION
DELAWARE
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7 SOLE VOTING POWER
- 0 -
---------------------------------------------------------
NUMBER OF 8 SHARED VOTING POWER
SHARES
BENEFICIALLY 3,700
OWNED BY ---------------------------------------------------------
EACH 9 SOLE DISPOSITIVE POWER
REPORTING
PERSON WITH - 0 -
---------------------------------------------------------
10 SHARED DISPOSITIVE POWER
3,700
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11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH PERSON
3,700
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12 CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES*
[ ]
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13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
Less than 0.1%
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14 TYPE OF REPORTING PERSON*
CO
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* SEE INSTRUCTIONS
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CUSIP NO. 75689M101 SCHEDULE 13D PAGE 7 OF 14 PAGES
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1 NAME OF REPORTING PERSON
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
GREGORY P. TAXIN
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [X]
(b) [ ]
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3 SEC USE ONLY
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4 SOURCE OF FUNDS*
AF
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5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEMS 2(d) or 2(e) [ ]
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6 CITIZENSHIP OR PLACE OF ORGANIZATION
UNITED STATES
-------------------------------------------------------------------------------
7 SOLE VOTING POWER
- 0 -
---------------------------------------------------------
NUMBER OF 8 SHARED VOTING POWER
SHARES
BENEFICIALLY 3,700
OWNED BY ---------------------------------------------------------
EACH 9 SOLE DISPOSITIVE POWER
REPORTING
PERSON WITH - 0 -
---------------------------------------------------------
10 SHARED DISPOSITIVE POWER
3,700
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11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH PERSON
3,700
-------------------------------------------------------------------------------
12 CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES*
[ ]
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13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
Less than 0.1%
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14 TYPE OF REPORTING PERSON*
IN
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* SEE INSTRUCTIONS
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CUSIP NO. 75689M101 SCHEDULE 13D PAGE 8 OF 14 PAGES
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ITEM 1. SECURITY AND ISSUER.
This statement relates to the shares of Common Stock, $0.001 par
value per share (the "Shares"), of Red Robin Gourmet Burgers, Inc., a Delaware
corporation (the "Issuer"). The principal executive office of the Issuer is
located at 6312 S Fiddler's Green Circle, Suite 200N, Greenwood Village, CO.
ITEM 2. IDENTITY AND BACKGROUND.
(a) This statement is filed by Clinton Group, Inc., a Delaware
corporation ("CGI"), Clinton Magnolia Master Fund, Ltd., a Cayman Islands
exempted company ("CMAG"), Clinton Special Opportunities Master Fund, Ltd., a
Cayman Islands exempted company ("CSO"), George Hall (CGI, CMAG, CSO and George
Hall, collectively "Clinton"), Spotlight Advisors, LLC, a Delaware Limited
Liability Company ("SAL"), and Gregory Taxin (SAL and Gregory Taxin,
collectively "Spotlight," and collectively with Clinton, the "Reporting
Persons").
(b) The principal business address of CGI, CSO, SAL, George Hall and
Gregory Taxin is 9 West 57th Street, 26th Floor, New York, New York 10019. The
principal business address of CMAG is c/o Fortis Fund Services (Cayman) Limited,
P.O. Box 2003 GT, Grand Pavilion Commercial Centre, 802 West Bay Road, Grand
Cayman, Cayman Islands.
(c) The principal business of CGI is investing for funds and
accounts under its management. The principal business of CMAG, CSO and SAL is to
invest in securities. George Hall is the Chief Investment Officer and President
of CGI. Gregory Taxin is the managing member of SAL. His principal occupation is
to invest in securities.
(d) None of the Reporting Persons nor any of the individuals set
forth in Schedule A attached hereto has, during the last five years, been
convicted in a criminal proceeding (excluding traffic violations or similar
misdemeanors).
(e) None of the Reporting Persons nor any of the individuals set
forth in Schedule A attached hereto has, during the last five years, been a
party to a civil proceeding of a judicial or administrative body of competent
jurisdiction and as a result of such proceeding was or is subject to a judgment,
decree or final order enjoining future violations of, or prohibiting or
mandating activities subject to, federal or state securities laws or finding any
violation with respect to such laws.
(f) George Hall and Gregory Taxin are citizens of the United States
of America.
The name, citizenship, present principal occupation or employment
and business address of each director and executive officer of CGI, CMAG, CSO
and SAL is set forth in Schedule A attached hereto. To the best of the Reporting
Persons' knowledge, except as set forth in this statement on Schedule 13D, none
of such individuals owns any Shares.
ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
Funds for the purchase of the Shares reported herein were derived
from available capital of CMAG, CSO and SAL. A total of approximately
$16,930,000 was paid to acquire such Shares.
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CUSIP NO. 75689M101 SCHEDULE 13D PAGE 9 OF 14 PAGES
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ITEM 4. PURPOSE OF TRANSACTION.
The Reporting Persons acquired the Shares for investment in the
ordinary course of business. The Reporting Persons believe that the Shares at
current market prices are undervalued and represent an attractive investment
opportunity. The Reporting Persons may make further purchases of the Shares from
time to time and may dispose of or sell any or all of the Shares held by it at
any time.
As of March 4, 2010, CGI and SAL, on behalf of themselves and their
affiliates, entered into a Settlement Agreement (the "Agreement") with the
Issuer. A summary description of the Agreement is provided in Item 6 hereto.
As detailed in the summary description of the Agreement, the Board
of Directors of the Issuer (the "Board") and the Issuer agreed to take certain
business and governance actions by the date of this filing. The Reporting
Persons intend to hold further discussions with the Issuer and the Board with
respect to the Agreement and the Issuer's compliance with several important
provisions thereof, including the Issuer's obligation to, "as promptly as is
reasonably practicable," identify an additional independent director to serve on
the Board and its obligations with respect to the Succession Committee.
ITEM 5. INTEREST IN SECURITIES OF THE ISSUER.
(a) The aggregate percentage of Shares beneficially owned by the
Reporting Persons is based upon 15,602,353 Shares outstanding, which is the
total number of Shares outstanding as of May 18, 2010 as reported in the
Issuer's Quarterly Report on Form 10-Q filed with the Securities and Exchange
Commission on May 21, 2010 for the period ended April 18, 2010.
As of the close of business on June 9, 2010, Clinton may be deemed
the beneficial owners of an aggregate of 795,315 Shares constituting
approximately 5.10% of the Shares outstanding.
By virtue of the Letter Agreement, the Reporting Persons may be
deemed to have formed a "group" within the meaning of Section 13(d)(3) of the
Securities Act of 1934 and may be deemed to beneficially own 795,315 Shares,
constituting approximately 5.10% of the Shares outstanding. However, (i) Clinton
expressly disclaims beneficial ownership of the Shares beneficially owned by
Spotlight and (ii) Spotlight expressly disclaims beneficial ownership of the
Shares beneficially owned by Clinton.
(b) By virtue of investment management agreements with CMAG and CSO,
CGI has the power to vote or direct the voting, and to dispose or direct the
disposition, of all of the 795,315 Shares beneficially owned by CMAG and CSO. By
virtue of his direct and indirect control of CGI and CSO, George Hall is deemed
to have shared voting power and shared dispositive power with respect to all
Shares as to which CGI and CSO has voting power or dispositive power.
By virtue of his direct control as managing member of SAL, Gregory
Taxin is deemed to have shared voting power and shared dispositive power with
respect to all Shares as to which SAL has voting power or dispositive power.
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CUSIP NO. 75689M101 SCHEDULE 13D PAGE 10 OF 14 PAGES
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(c) Information concerning transactions in the Shares effected by
the Reporting Persons during the past sixty days is set forth in Schedule B
hereto and is incorporated herein by reference. Unless otherwise indicated, all
of such transactions were effected in the open market.
(d) No person (other than the Reporting Persons) is known to have
the right to receive or the power to direct the receipt of dividends from, or
the proceeds from the sale of, the Shares.
(e) Not applicable.
ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH
RESPECT TO SECURITIES OF THE ISSUER.
On November 9, 2009, CMAG and Spotlight entered into an oral
arrangement for Spotlight to provide consulting services to CMAG in connection
with its investment in securities of the Issuer. On June 9, 2010, CMAG and
Spotlight amended this agreement to include CSO as a party thereunder. As
consideration of such services, CMAG and CSO agreed to pay Spotlight ten percent
(10%) of any realized net gains on Shares or other securities in respect of
Issuer held by Clinton, including puts, calls, swaps and other derivates.
The Reporting Persons (other than CSO) have entered into a Letter
Agreement dated December 21, 2009 (the "Letter Agreement"), regarding certain
conduct of the Reporting Persons. On June 9, 2010, the Reporting Person amended
the Letter Agreement to include CSO as a party thereunder. The Letter Agreement
includes, but is not limited to, an agreement by the parties to (i) consult with
each other with respect to all purchases and sales of Shares, (ii) share
expenses incurred in connection with the Reporting Persons' activities and (iii)
jointly approve any filing with the SEC, press release or shareholder
communication. Any party to the Letter Agreement may terminate its obligations
under the Letter Agreement on 24 hours written notice to all other parties. A
copy of the Letter Agreement and the first amendment are attached hereto as
Exhibits 1 and 2 and are incorporated by reference herein.
The Reporting Persons are parties to an agreement with respect to
the joint filing of this Statement and any amendments thereto. A copy of such
agreement is attached hereto as Exhibit 3 and is incorporated by reference
herein.
As discussed in Item 4 herein, the Reporting Persons and the Issuer
entered into the Agreement providing for certain standstill undertakings by the
Reporting Persons. Pursuant to the terms of the Agreement, the parties agreed
that, subject to certain conditions, the Issuer will (i) appoint Robert Aiken,
effective March 4, 2010, to serve as a Class I director; (ii) appoint Lloyd Hill
and Stuart Oran, effective March 4, 2010, to serve as Class II directors; (iii)
expect to appoint Mssrs. Aiken, Hill and Oran to board committees; (iv) nominate
and recommend in favor of the election of Mr. Hill and Mr. Oran at the Issuer's
2010 Annual Meeting of Stockholders (the "2010 Annual Meeting") for a three-year
term; (v) identify and appoint, after reasonable consultation with the Reporting
Persons, an additional independent candidate to serve as a Class III director;
(vi) immediately following the 2010 Annual Meeting of the Shareholders, decrease
the number of directors by two; (vii) review and modify its director
compensation practices; (viii) amend the Company's Amended and Restated 2007
Performance Incentive Plan to prohibit option repricing actions without
shareholder consent; (ix) create a Succession Committee; and (x) approve an
amendment to the Issuer's Certificate of Incorporation adopting a majority
voting standard for the election of directors (the "Amendment";), subject to
shareholder approval at the 2010 Annual Meeting.
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CUSIP NO. 75689M101 SCHEDULE 13D PAGE 11 OF 14 PAGES
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Subject to certain conditions, the Reporting Persons will (i)
publicly support and vote their shares in favor of the election of the Class II
Directors at the 2010 Annual Meeting; (ii) vote to abstain or against any
shareholder nominations for director or shareholder proposals which are not
approved and recommended by the Board; (iii) publicly support and vote for the
ratification of the Amendment; (iv) publicly support and vote for ratification
of Deloitte & Touche as the Issuer's auditors for the 2010 fiscal year and (v)
through December 31, 2010 (or earlier under certain circumstances) abide by
certain restrictions on activities regarding the Issuer, including, but not
limited to, (a) not participating in any contested proxy solicitation, with
limited exceptions relating to certain publicly-announced transactions involving
the Issuer, (b) proposing or nominating candidates for the Board, (c) forming a
"group" with unrelated parties, (d) requesting a special meeting and (e)
publicly disparaging any member of the Board or management of the Issuer.
The foregoing description of the Agreement is a summary only and is
qualified in its entirety by reference to the Agreement, which is attached
hereto as Exhibit 4 and is incorporated herein by reference.
A copy of the related press release issued March 4, 2010 announcing
the Agreement is attached hereto as Exhibit 5 and is incorporated herein by
reference.
Except as otherwise set forth herein, the Reporting Persons do not
have any contract, arrangement, understanding or relationship with any person
with respect to the securities of the Issuer.
ITEM 7. MATERIAL TO BE FILED AS EXHIBITS
Exhibit 1 Letter Agreement among Clinton Group Inc., Clinton Magnolia Master
Fund Ltd., George Hall and Spotlight Advisors, LLC dated December
21, 2009.
Exhibit 2 Amendment No. 1 to the Letter Agreement, dated June 9, 2010.
Exhibit 3 Joint Filing Agreement, dated June 9, 2010.
Exhibit 4 Standstill Agreement, dated March 4, 2010 by and among CGI, SAL and
the Company.
Exhibit 5 Press Release issued on March 4, 2010.
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CUSIP NO. 75689M101 SCHEDULE 13D PAGE 12 OF 14 PAGES
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SIGNATURES
After reasonable inquiry and to the best of his or its knowledge and
belief, each of the undersigned certifies that the information set forth in this
statement is true, complete and correct.
Dated: June 10, 2010
CLINTON GROUP, INC.
By: /s/ Francis Ruchalski
---------------------------
Name: Francis Ruchalski
Title: Chief Financial Officer
CLINTON MAGNOLIA MASTER FUND, LTD.
By: Clinton Group, Inc. its investment
manager
By: /s/ Francis Ruchalski
---------------------------
Name: Francis Ruchalski
Title: Chief Financial Officer
CLINTON SPECIAL OPPORTUNITIES MASTER FUND, LTD.
By: Clinton Group, Inc. its investment
Manager
By: /s/ Francis Ruchalski
---------------------------
Name: Francis Ruchalski
Title: Chief Financial Officer
/s/ George Hall
------------------------------
George Hall
SPOTLIGHT ADVISORS, LLC
By: /s/ Gregory P. Taxin
---------------------------
Name: Gregory P. Taxin
Title: Managing Member
/s/ Gregory P. Taxin
------------------------------
Gregory P. Taxin
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CUSIP NO. 75689M101 SCHEDULE 13D PAGE 13 OF 14 PAGES
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SCHEDULE A
DIRECTORS AND EXECUTIVE OFFICERS OF CERTAIN REPORTING PERSONS
The following sets forth the name, position and principal occupation of
each director and executive officer of CGI. Each such person is a citizen of the
United States of America. The business address of each director and executive
officer is 9 West 57th Street, 26th Floor, New York, New York 10019.
CLINTON GROUP, INC.
Name Position
--------------------------- -------------------------------------------
George Hall Director and President
Francis A. Ruchalski Director and Chief Financial Officer
John L. Hall Director
The following sets forth the name, citizenship, principal occupation and
business address of each director of each of CMAG, CSO and SAL. There are no
executive officers of CMAG, CSO or SAL.
CLINTON MAGNOLIA MASTER FUND, LTD.
Jane Fleming is a citizen of the United Kingdom. Her principal occupation is
Client Accountant of Queensgate Bank & Trust Company Ltd. Her business address
is Queensgate Bank & Trust Company Ltd., Harbour Place, 5th Floor, 103 South
Church Street, P.O. Box 30464 SMB, Grand Cayman, Cayman Islands.
Dennis Hunter is a citizen of the United Kingdom. His principal occupation is
Director of Queensgate Bank & Trust Company Ltd. His business address is
Queensgate Bank & Trust Company Ltd., Harbour Place, 5th Floor, 103 South Church
Street, P.O. Box 30464 SMB, Grand Cayman, Cayman Islands.
Roger Hanson is a citizen of the United Kingdom. His principal occupation is
director of dms Management Ltd. His business address is dms Management Ltd.,
P.O. Box 31910 SMB, Ansbacher House, 20 Genesis Close, Grand Cayman, Cayman
Islands.
CLINTON SPECIAL OPPORTUNITIES MASTER FUND, LTD.
Jane Fleming is a citizen of the United Kingdom. Her principal occupation is
Client Accountant of Queensgate Bank & Trust Company Ltd. Her business address
is Queensgate Bank & Trust Company Ltd., Harbour Place, 5th Floor, 103 South
Church Street, P.O. Box 30464 SMB, Grand Cayman, Cayman Islands.
Dennis Hunter is a citizen of the United Kingdom. His principal occupation is
Director of Queensgate Bank & Trust Company Ltd. His business address is
Queensgate Bank & Trust Company Ltd., Harbour Place, 5th Floor, 103 South Church
Street, P.O. Box 30464 SMB, Grand Cayman, Cayman Islands.
Roger Hanson is a citizen of the United Kingdom. His principal occupation is
director of dms Management Ltd. His business address is dms Management Ltd.,
P.O. Box 31910 SMB, Ansbacher House, 20 Genesis Close, Grand Cayman, Cayman
Islands.
SPOTLIGHT ADVISORS, LLC
Gregory Taxin is the Managing Member.
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CUSIP NO. 75689M101 SCHEDULE 13D PAGE 14 OF 14 PAGES
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SCHEDULE B
This Schedule sets forth information with respect to each purchase
and sale of Shares which were effectuated by a Reporting Person during the past
sixty days. Unless otherwise indicated, all transactions were effectuated in the
open market through a broker.
SPOTLIGHT ADVISORS, LLC
EQUITY
Trade Date Shares Purchased (Sold) Price Per Share ($)
----------- ------------------------ -------------------
5/20/2010 700 21.20
CLINTON SPECIAL OPPORTUNITIES MASTER FUND, LTD.
EQUITY
Trade Date Shares Purchased (Sold) Price Per Share ($)
----------- ------------------------ -------------------
6/9/2010 50,000 18.15989
CLINTON MAGNOLIA MASTER FUND, LTD.
EQUITY
Trade Date Shares Purchased (Sold) Price Per Share ($)
----------- ------------------------ -------------------
4/29/2010 20,000 24.65459
5/19/2010 (5,000) 25.16001
5/21/2010 75,019 20.01134
5/21/2010 40,700 25.00000
5/26/2010 45,000 20.05018
5/27/2010 51,710 20.08914
5/28/2010 (17,700) 20.75198
6/1/2010 100 25.00000
6/2/2010 25,000 19.25297
6/3/2010 (5,000) 19.98858
6/3/2010 1,600 25.00000
6/7/2010 2,500 25.00000
6/8/2010 (15,000) 17.27547
OPTIONS
Trade Date Expiration Date Quantity Strike Price ($)
------------ ----------------- ---------- --------------
4/20/2010 9/17/2010 (7,800) 22.50
4/22/2010 5/21/2010 (8,200) 25.00
4/23/2010 5/21/2010 (32,500) 25.00
4/29/2010 5/21/2010 (15,100) 25.00
5/17/2010 5/21/2010 (50,000) 25.00
5/19/2010 5/21/2010 (20,000) 25.00
5/20/2010 6/18/2010 (30,000) 25.00
5/20/2010 6/18/2010 (5,000) 22.50
5/20/2010 5/21/2010 (80,000) 25.00
5/21/2010 6/18/2010 20,000 25.00
5/21/2010 6/18/2010 45,100 25.00
5/21/2010 6/18/2010 (2,200) 20.00
5/24/2010 6/18/2010 (75,000) 20.00
5/24/2010 6/18/2010 45,000 25.00
5/25/2010 6/18/2010 10,000 25.00
5/28/2010 6/18/2010 (15,000) 20.00
5/28/2010 6/18/2010 (5,000) 20.00
6/3/2010 6/18/2010 (17,600) 20.00
6/3/2010 6/18/2010 (32,600) 20.00
6/7/2010 6/18/2010 10,000 20.00
6/8/2010 6/18/2010 (23,100) 17.50
6/8/2010 6/18/2010 10,000 25.00
6/9/2010 6/18/2010 4,100 22.50
EXHIBIT 1
LETTER AGREEMENT
WHEREAS, certain of the undersigned are stockholders, direct or
beneficial, of Red Robin Gourmet Burgers, Inc., a Delaware corporation (the
"Company"); and
WHEREAS, (i) Spotlight Advisors, LLC, Gregory P. Taxin, (together,
the "Spotlight Parties") and (ii) Clinton Magnolia Master Fund, Ltd., Clinton
Group, Inc., and George E. Hall (together, the "Clinton Parties," and
collectively with the Spotlight Parties, the "Group"), wish to enter into this
Letter Agreement (the "Letter Agreement") pertaining to their investments in,
and activities related to, the Company and its Securities.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto, intending to
be legally bound hereby, covenant and agree as follows:
I. Spotlight Advisors, LLC and Clinton Group, Inc. each agree to consult with
each other regarding all purchases and sales of Securities of the Company by
their affiliates. "Securities" shall mean equity securities of the Company,
options to purchase or sell equity securities of the Company, and swaps,
synthetics and other derivative securities or instruments, the value of which is
solely and directly related to equity securities of the Company.
Furthermore, so long as this Agreement is in effect, (i) none of the
parties shall acquire Securities of the Company if as a result the Group would
be deemed to have beneficial ownership of 10% or more of any class of the
outstanding equity of the Company without the prior agreement of Spotlight
Advisors, LLC, or its representatives, and Clinton Group, Inc., or its
representatives (collectively, the "Representatives"), (ii) none of the parties
shall purchase, sell or otherwise increase or decrease their economic exposure
to Securities of the Company if such party reasonably believes that, as a result
of such action, the Group or any member thereof would be likely to be required
to make any regulatory filing without using their reasonable efforts to give the
other parties at least 24 hours prior written notice, and (iii) each of the
undersigned shall provide written notice to the other of (a) any of their
purchases or sales of Securities of the Company; and (b) any Securities of the
Company over which they acquire or dispose of beneficial ownership, no later
than 24 hours after each such transaction.
II. Each party shall pay its pro rata portion of all expenses
incurred in connection with the Group's activities based on their relative
security ownership.
III. Each of the undersigned agrees that any filing with the
Securities and Exchange Commission, press release or stockholder communication
proposed to be made or issued by the Group or any member of the Group in
connection with the Group's activities shall be jointly approved by the
Representatives, which approval shall not be unreasonably withheld or delayed.
IV. The relationship of the parties hereto shall be limited to
carrying on the activities of the Group in accordance with the terms of this
Agreement.
Such relationship shall be construed and deemed to be for the sole
and limited purpose of carrying on such activities as described herein. Nothing
herein shall be construed to authorize any party to act as an agent for any
other party, or to create a joint venture or partnership, or to constitute an
indemnification.
Except as otherwise expressly provided herein, nothing herein shall
restrict any party's right to purchase or sell Securities of the Company, as
he/it deems appropriate, in his/its sole discretion, provided that all such
sales are made in compliance with all applicable securities laws.
V. This Agreement may be executed in counterparts, each of which
shall be deemed an original and all of which, taken together, shall constitute
but one and the same instrument, which may be sufficiently evidenced by one
counterpart.
VI. In the event of any dispute among the parties hereto arising out
of the provisions of this Agreement or their investment in the Company, the
parties hereto consent and submit to the exclusive jurisdiction of the Federal
and State Courts in the State of New York.
VII. Any party hereto may terminate his/its obligations under this
Agreement on 24 hours written notice to all other parties.
VIII. Each party acknowledges that Schulte Roth & Zabel LLP shall
act as counsel for both the Group and the Clinton Parties relating to their
investment in the Company.
IX. Each of the undersigned parties hereby agrees that this Group
X. Agreement shall be filed as an exhibit to an amendment to a
Schedule 13D.
[SIGNATURE PAGE FOLLOWS]
IN WITNESS WHEREOF, each of the parties hereto has caused this Group
Agreement to be executed as of the 21st day of December, 2009.
CLINTON MAGNOLIA MASTER FUND, LTD.
By: Clinton Group, Inc. its investment
manager
By: /s/ Francis Ruchalski
---------------------------
Name: Francis Ruchalski
Title: Chief Financial Officer
CLINTON GROUP, INC.
By: Clinton Group, Inc. its investment
manager
By: /s/ Francis Ruchalski
---------------------------
Name: Francis Ruchalski
Title: Chief Financial Officer
/s/ George Hall
------------------------------
George Hall
SPOTLIGHT ADVISORS, LLC
By: /s/ Gregory P. Taxin
---------------------------
Name: Gregory P. Taxin
Title: Managing Member
By: /s/ Gregory P. Taxin
------------------------------
Gregory P. Taxin
EXHIBIT 2
AMENDMENT NO. 1 TO THE LETTER AGREEMENT
WHEREAS, certain of the undersigned are stockholders, direct or
beneficial, of Red Robin Gourmet Burgers, Inc., a Delaware corporation (the
"Company"); and
WHEREAS, on December 21, 2009 Spotlight Advisors, LLC, Gregory P.
Taxin, Clinton Magnolia Master Fund, Ltd., Clinton Group, Inc., and George E.
Hall (collectively, the "Parties") entered into a Letter Agreement (the "Letter
Agreement") pertaining to their investments in, and activities related to, the
Company and its Securities.
WHEREAS, each of the Parties wish to add Clinton Special
Opportunities Master Fund, Ltd. ("CSO") as a party to the Letter Agreement.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Parties hereto, intending to
be legally bound hereby, covenant and agree as follows:
I. Each of the Parties agree CSO shall be a party to the Letter
Agreement and shall be included for all purposes within the definition of
"Clinton Parties" thereto.
[SIGNATURE PAGE FOLLOWS]
IN WITNESS WHEREOF, each of the parties hereto has caused this
Amendment No.1 to the Letter Agreement to be executed as of the 9th day of June,
2010.
CCLINTON MAGNOLIA MASTER FUND, LTD.
By: Clinton Group, Inc. its investment
manager
By: /s/ Francis Ruchalski
---------------------------
Name: Francis Ruchalski
Title: Chief Financial Officer
CLINTON GROUP, INC.
By: Clinton Group, Inc. its investment
manager
By: /s/ Francis Ruchalski
---------------------------
Name: Francis Ruchalski
Title: Chief Financial Officer
CLINTON SPECIAL OPPORTUNITIES MASTER FUND, LTD.
By: Clinton Group, Inc. its investment
manager
By: /s/ Francis Ruchalski
---------------------------
Name: Francis Ruchalski
Title: Chief Financial Officer
/s/ George Hall
------------------------------
George Hall
SPOTLIGHT ADVISORS, LLC
By: /s/ Gregory P. Taxin
---------------------------
Name: Gregory P. Taxin
Title: Managing Member
By /s/ Gregory P. Taxin
------------------------------
Gregory P. Taxin
EXHIBIT 3
JOINT FILING AGREEMENT
PURSUANT TO RULE 13d-1(k)
The undersigned acknowledge and agree that the foregoing statement
on Schedule 13D is filed on behalf of each of the undersigned and that all
subsequent amendments to this statement on Schedule 13D may be filed on behalf
of each of the undersigned without the necessity of filing additional joint
filing agreements. The undersigned acknowledge that each shall be responsible
for the timely filing of such amendments, and for the completeness and accuracy
of the information concerning him or it contained herein and therein, but shall
not be responsible for the completeness and accuracy of the information
concerning the others, except to the extent that he or it knows that such
information is inaccurate.
Dated: June 9, 2010
CLINTON MAGNOLIA MASTER FUND, LTD.
By: Clinton Group, Inc.,
its investment manager
By: /s/ Francis Ruchalski
------------------------------
Name: Francis Ruchalski
Title: Chief Financial Officer
CLINTON MAGNOLIA MASTER FUND, LTD.
By: /s/ Francis Ruchalski
------------------------------
Name: Francis Ruchalski
Title: Comptroller
CLINTON SPECIAL OPPORTUNITIES MASTER FUND, LTD.
By: Clinton Group, Inc.,
its investment manager
By: /s/ Francis Ruchalski
------------------------------
Name: Francis Ruchalski
Title: Chief Financial Officer
CLINTON SPECIAL OPPORTUNITIES MASTER FUND, LTD.
By: /s/ Francis Ruchalski
------------------------------
Name: Francis Ruchalski
Title: Comptroller
/s/ George Hall
------------------------------
George Hall
SPOTLIGHT ADVISORS, LLC
By: /s/ Gregory Taxin
------------------------------
Name: Gregory Taxin
Title: Managing Member
/s/ Gregory Taxin
------------------------------
Gregory Taxin
EXHIBIT 4
RED ROBIN GOURMET BURGERS, INC.
6312 SOUTH FIDDLERS GREEN CIRCLE, # 200N
GREENWOOD VILLAGE, CO 80111
March 4, 2010
Mr. Gregory P. Taxin Spotlight Advisors, LLC
9 West 57th Street, 26th Floor
New York, NY 10019
Mr. Vincent Darpino Clinton Group, Inc.
9 West 57th Street, 26th Floor
New York, NY 10019
Dear Mssrs. Taxin and Darpino:
This letter constitutes the agreement (the AGREEMENT) among
Spotlight Advisors, LLC, a Delaware limited liability company (SPOTLIGHT) and
Clinton Group, Inc., a Delaware corporation (CLINTON), on behalf of themselves
and their respective affiliated funds, persons and entities, both current and
future (collectively, the INVESTOR GROUP) and Red Robin Gourmet Burgers, Inc., a
Delaware corporation (the COMPANY).
WHEREAS, the Company and Investor Group have agreed that it is
in their mutual interests to enter into this Agreement, among other things, to
set forth certain agreements concerning the composition of the board of
directors of the Company (the BOARD) and other corporate governance matters, as
hereinafter described.
NOW, THEREFORE, in consideration of the promises and the
representations, warranties and agreements contained herein, and other good and
valuable consideration, the parties hereto mutually agree as follows:
1. As promptly as practicable following the date of this
Agreement (but in no event later than March 8, 2010), the Board shall:
(a) pursuant to the powers granted to the Board under
Article II of the Bylaws of the Company (the
BYLAWS), increase the size of the Board to eleven and appoint Robert Aiken
(Aiken) as a Class I director (the Class I Director) and Lloyd Hill (Hill) and
Stuart Oran (Oran) as Class II directors of the Company (Hill and Oran together,
the Class II Directors) to fill the new directorships so created on the Board
and to serve in such capacity from such date of election through the date of, in
the case of the Class I Director, the Company's 2012 annual meeting of the
shareholders (the "2012 Annual Meeting") and in the case of the Class II
Directors, the Company's 2010 annual meeting of the shareholders (the "2010
Annual Meeting"), and until their successors are duly elected and qualified.
(b) promptly after their election as directors and
subject to all applicable requirements, the Board
expects to appoint each New Director (as defined below) to serve on the
Nominating and Governance Committee and/or the Compensation Committee, and those
with suitable experience will be considered for service on the Audit Committee.
(c) identify as promptly as is reasonably practicable
one additional candidate to serve on the Board who (i) is qualified to serve on
the Board under all requirements set forth in the Bylaws, (ii) is not employed
by or otherwise affiliated with the Company, (iii) otherwise qualifies as
"independent" in accordance with Rule 5605(a)(2) of the NASDAQ Listing Rules and
(iv) shall not be an Inside Director or an Affiliated Outside Director as
defined in RiskMetrics Group's Classification of Directors-2010, dated November
29, 2009 (such candidate, the "Additional Director" and together with Aiken,
Hill and Oran, the "New Directors" and each a "New Director"), increase the size
of the Board to twelve (assuming such appointment is in advance of the 2010
Annual Meeting) and appoint the Additional Director as a Class III director to
fill the new directorship so created on the Board. Prior to such appointment,
the Company shall reasonably consult with the Investor Group with regard to the
identity and qualifications of the Additional Director.
2. The Company and the Investor Group agree that the Board and
the Nominating and Governance Committee thereof shall nominate and recommend
each of Hill and Oran (other than in the case of her, his or their inability or
refusal to serve), to stand for election as Class II directors at the 2010
Annual Meeting for terms that expire at the 2013 annual meeting of shareholders
of the Company and until their successors are duly elected and qualified. The
terms of Edward Harvey and Gary Singer, who have decided not to stand for
re-election, shall expire at the 2010 Annual Meeting. Immediately following the
2010 Annual Meeting, the Board shall reduce the size of the Board by two;
thereafter, the size of the Board shall be established as set forth in the
Bylaws.
3. The Company shall publicly support the election to the
Board of each of the Class II Directors at the 2010 Annual Meeting, including,
without limitation, soliciting proxies in favor of their election.
4. Immediately after the execution of this agreement, the
Board shall adopt a resolution (i) approving the proposed amendment to the
Company's Certificate of Incorporation (the "Company Charter") adopting a
majority voting standard for the election of directors substantially in the form
set forth in Exhibit A to this Agreement (the "Amendment"), (ii) recommending to
the Company's stockholders the approval of the Amendment and (iii) directing
that the Amendment be considered at the 2010 Annual Meeting. The Company shall
publicly support the approval of the Amendment by the stockholders at the 2010
Annual Meeting, including, without limitation, soliciting proxies in favor of
its approval.
5. Consistent with its fiduciary duties, the Board shall
review and modify as necessary its director compensation practices to ensure
that director pay is in line with market practices and compensation levels for
comparable companies.
6. Immediately after the execution of this agreement, the
Board shall adopt a resolution approving an amendment to the Company's Amended
and Restated 2007 Performance Incentive Plan (the "Performance Amendment") that
provides for a specific prohibition on certain actions that may be construed as
option repricing, including cash tender offers for underwater options. The
Performance Amendment shall not be amended or waived without the consent of
stockholders holding a majority of the then-outstanding shares of Common Stock.
7. Each member of the Investor Group shall (a) in the case of
all shares of the Company's Common Stock (the "Common Stock") owned of record by
it as of the record date for the 2010 Annual Meeting (the "Record Date"), and
(b) in the case of all shares of the Common Stock beneficially owned by any
member of the Investor Group as of the Record Date (whether held in street name
or by some other arrangement), instruct the record holder to: in each case at
the 2010 Annual Meeting, (i) publicly support and vote for the election of each
of the Class II Directors; (ii) vote to abstain or against any shareholder
nominations for director or shareholder proposals (whether made pursuant to Rule
14a-8 or Rule 14a-4 under the Securities Exchange Act of 1934, as amended (the
"Exchange Act," and such proposals, "Shareholder Proposals")) which are not
approved and recommended by the Board, (iii) publicly support and vote for the
ratification of the Amendment, and (iv) publicly support and vote for
ratification of Deloitte & Touche as the Company's auditors for the 2010 fiscal
year.
8. Pursuant to the powers granted to the Board under Article
III of the Bylaws, no later than March 8, 2010, the Board shall form a committee
responsible for identifying, interviewing, negotiating with and recommending for
hire a new Chief Executive Officer ("New CEO") for the Company (the "Succession
Committee"). The Succession Committee shall serve at the direction of the Board,
and the full Board shall be responsible for the final decision with respect to
the hiring of, and the terms of employment of, the New CEO. The Succession
Committee's members shall be Pattye Moore and Mssrs. Hill, Oran, and Aiken. The
Company and the Board shall not disband the Succession Committee prior to the
hiring of a New CEO. The Company and Board shall provide the resources
reasonably requested by the Succession Committee, including money to hire
outside advisors and executive search consultants, and reasonable access to
Company property and personnel for conducting its responsibilities. The Board
shall not change the composition or size of the Succession Committee without the
approval of a majority of the then-serving members of the Succession Committee.
If a New CEO is not identified and publicly announced by
December 31, 2010, the Succession Committee shall provide shareholders of the
Company with a report (the "Report") on the status of the CEO search; the Report
shall be updated quarterly thereafter until a New CEO has been named.
9. Except as otherwise set forth in this Agreement, including
the Investor Group's agreement to support the Company's nominees and proposals
described in this Agreement, from the date of this Agreement until the earlier
of (i) December 31, 2010 or (ii) the Anniversary Date (as defined below) (the
"Standstill Period"), no member of the Investor Group shall:
(a) make, or in any way participate, directly or
indirectly, in any "solicitation" (as such term is
used in the proxy rules of the Securities and Exchange Commission (the "SEC"))
of proxies or consents, conduct or suggest any binding or nonbinding referendum
or resolution or seek to advise, encourage or influence any individual,
partnership, corporation, limited liability company, group, association or
entity (collectively, a "Person") with respect to the voting of any of the
Common Stock;
(b) initiate, propose or otherwise "solicit" (as such
term is used in the proxy rules of the SEC)
shareholders of the Company for the approval of shareholder proposals, as
amended, or otherwise, or cause or encourage any person to initiate any such
shareholder proposal;
(c) propose or nominate, or cause or encourage any
person to propose or nominate, any candidates to
stand for election to the Board, or seek the removal of any member of the Board;
(d) form, join or otherwise participate in a
"partnership, limited partnership, syndicate or other
group" within the meaning of Section 13(d)(3) of the Exchange Act (other than
the group already formed between Spotlight and Clinton) with respect to the
Common Stock or deposit any shares of Common Stock in a voting trust or similar
arrangement or subject any shares of Common Stock to any voting agreement or
pooling arrangement, or grant any proxy with respect to any shares of Common
Stock (other than to a designated representative of the Company pursuant to a
proxy statement of the Company);
(e) take any public action to act alone or in concert
with others to control or seek to control, or to influence or seek to influence,
the management, the Board or the policies of the Company;
(f) seek to call, or to request the call of, or call
a special meeting of the shareholders of the Company, or make a request for a
list of the Company's shareholders or other Company records; or
(g) otherwise take, or solicit, cause or encourage
others to take, any action inconsistent with any of
the foregoing.
(h) For the avoidance of doubt, any actions of the
New Directors taken in their capacity as members of
the Board shall not be deemed to violate the foregoing clauses (a) through (g).
(i) For purposes of this Agreement, "Anniversary
Date" shall mean the date that is sixty (60) calendar days prior to the first
anniversary of the date the Company's proxy statement is released to
shareholders in connection with the 2010 Annual Meeting (provided, however, that
if the Board takes any action to amend the Bylaws in such a manner as to
increase the time period prior to the Company's 2011 annual meeting of the
stockholders (the "2011 Annual Meeting") by which a holder of the Common Stock
must provide timely notice to the Company of (A) its nomination of a person or
persons to the Board at the 2011 Annual Meeting or (B) its proposal to bring
business before the 2011 Annual Meeting (clauses (A) and (B) together
"Stockholder Matters") then the Anniversary Date shall be the date ten (10) days
prior to the date on which a stockholder must give notice to the Company with
respect to any Stockholder Matters for the 2011 Annual Meeting.
10. During the Standstill Period, no member of the Investor
Group shall, and each of them shall not solicit, cause or encourage others to,
make any comments or statements regarding the Company or its current or former
officers, directors or employees, which are derogatory or detrimental to, or
which disparage, any of the Company or its current or former officers, directors
or employees, provided, however, that nothing in this Agreement to the contrary
shall prohibit the Investor Group from (i) making public statements (including
statements contemplated by Rule 14a-1(1)(2)(iv) under the Exchange Act), (ii)
engaging in discussions with other stockholders or (iii) soliciting, or
encouraging or participating in the solicitation of, proxies or consents with
respect to voting securities of the Company (so long as such discussions are in
compliance with subsection 9(d) hereof) in each case with respect to any
transaction that has been publicly announced by the Company involving (1) the
recapitalization of the Company, (2) an acquisition, disposition or sale of
assets or a business by the Company where the consideration to be received or
paid in such transaction requires approval by the holders of the Common Stock or
(3) a change of control of the Company.
During the Standstill Period, neither the Company nor any of
its officers or directors shall, nor shall any of them solicit, cause or
encourage others to, make any comments or statements regarding the Investor
Group or any of their respective partners, officers, directors or employees,
which are derogatory or detrimental to, or which disparage, any of them. The
foregoing shall not apply to compelled testimony, either by legal process,
subpoena or otherwise, or to communications that are required by an applicable
fiduciary or legal obligation and are subject to contractual provisions
providing for confidential disclosure.
11. The Company shall issue a press release substantially in
the form attached hereto as Exhibit B (the "Press Release") as soon as
practicable on or after the date hereof, but in no event later than March 8,
2010 and the Company shall file a corresponding Form 8-K that includes both the
Press Release and this Agreement. As soon as practicable on or after the date
hereof, but in no event later than March 8, 2010, the Investor Group shall file
a corresponding amendment on its Schedule 13D. Neither the Company nor the
Investor Group shall make any public announcement or statement that is
inconsistent with or contrary to the statements made in the Press Release,
except as required by law or the rules of any stock exchange or with the prior
written consent of the other party. Each member of the Investor Group represents
and warrants to the Company that it is unaware of any fact or circumstance that
would require them to make any such disclosure.
12. The Company and the Investor Group each acknowledge and
agree that (a) a breach or a threatened breach by either party may give rise to
irreparable injury inadequately compensable in damages and accordingly each
party shall be entitled to injunctive relief, without proof of actual damages,
to prevent a breach or threatened breach of the provisions hereof and to enforce
specifically the terms and provisions hereof in any state or federal court
having jurisdiction, (b) neither party shall plead in defense for any such
relief that there would be an adequate remedy at law, (c) any applicable right
or requirement that a bond be posted by either party is waived and (d) such
remedies shall not be the exclusive remedies for a breach of this Agreement, but
will be in addition to all other remedies available at law or in equity.
13. The Investor Group, for the benefit of the Company and
each of the Company's controlling persons, officers, directors, stockholders,
agents, affiliates, employees, attorneys and assigns, past and present, in their
capacity as such (the Company and each such person being a "Company Released
Person"), hereby forever waives and releases, and covenants not to sue, any of
the Company Released Persons for any and all claims, causes of action, actions,
judgments, liens, debts, contracts, indebtedness, damages, losses, liabilities,
rights, interests and demands of whatsoever kind or character (other than fraud)
(collectively, Claims") based on any event, fact, act, omission, or failure to
act by the Company Released Persons, whether known or unknown, occurring or
existing prior to the date hereof; provided, however, this waiver and release
and covenant not to sue shall not include any Claims arising out of or related
to any obligations under, or breach of, this Agreement and does not extend to
acts which are criminal.
14. The Company, for the benefit of any member of the Investor
Group and each of such member's controlling persons, officers, directors,
stockholders, agents, affiliates, employees, attorneys and assigns, past and
present, in their capacity as such (each such person being a "Investor Group
Released Person"), hereby forever waives and releases and covenants not to sue,
for any Claim based on any event, fact, act, omission or failure to act by such
Investor Group Released Person, whether known or unknown, occurring or existing
prior to the date hereof; provided, however, this waiver and release and
covenant not to sue shall not include any Claims arising out of or related to
any obligations under, or breach of, this Agreement and does not extend to acts
which are criminal.
15. All notices and other communications under this Agreement
shall be in writing and shall be given (and shall be deemed to have been duly
given upon receipt) by delivery in person or by facsimile, or by Federal Express
or registered or certified mail, postage pre-paid, return receipt requested, as
follows:
If to the Company:
Red Robin Gourmet Burgers, Inc.
6312 South Fiddlers Green Circle, # 200N
Greenwood Village, CO 80111
Attn: General Counsel
with a copy (which shall not constitute notice) to:
Ronald R. Levine, II
Davis Graham & Stubbs LLP
1550 17th Street, Suite 500
Denver, CO 80202
If to the Investor Group:
Spotlight Advisors, LLC
9 West 57th St., 26th Floor
New York, NY 10019
Attn: Gregory P. Taxin
and:
Clinton Group, Inc.
9 West 57th St., 26th Floor
New York, NY 10019
Attn: General Counsel
with a copy (which shall not constitute notice) to:
David Rosewater
c/o Schulte Roth & Zabel LLP
919 Third Avenue
New York, NY 10022
16. This Agreement may be executed by the signatories hereto
in separate counterparts, each of which when so executed and delivered shall be
an original, but all such counterparts shall together constitute one and the
same instrument.
17. This Agreement shall be governed by and construed in
accordance with the laws of the State of Delaware, without regard to its
conflict of laws principles. The parties hereto consent to personal jurisdiction
and venue in any action to enforce this Agreement in any court of competent
jurisdiction located in Denver, Colorado.
18. This Agreement constitutes the only agreement between the
Investor Group and the Company with respect to the subject matter hereof and
supersedes all prior agreements, understandings, negotiations and discussions
whether oral or written. This Agreement shall inure to the benefit of the
parties hereto and their respective successors and permitted assigns. This
Agreement may not be assigned by any party without the express written consent
of the other party. No amendment, modification, supplement or waiver of any
provision of this Agreement may in any event be effective unless in writing and
signed by the party or parties affected thereby.
19. The Company represents and warrants that (a) the Company
has the power and authority to execute, deliver and carry out the terms and
provisions of this Agreement and to consummate the transactions contemplated
hereby, and (b) this Agreement has been duly and validly authorized, executed
and delivered by the Company, constitutes a valid and binding obligation and
agreement of the Company and is enforceable against the Company in accordance
with its terms.
20. Spotlight represents and warrants that (a) it has the
power and authority to execute, deliver and carry out the terms and provisions
of this Agreement and to consummate the transactions contemplated hereby, and
(b) this Agreement has been duly and validly authorized, executed and delivered
by Spotlight, constitutes a valid and binding obligation and agreement of
Spotlight and is enforceable against Spotlight in accordance with its terms.
21. Clinton represents and warrants that (a) it has the power
and authority to execute, deliver and carry out the terms and provisions of this
Agreement and to consummate the transactions contemplated hereby, and (b) this
Agreement has been duly and validly authorized, executed and delivered by
Clinton, constitutes a valid and binding obligation and agreement of Clinton and
is enforceable against Clinton in accordance with its terms.
22. The Company shall be responsible for reimbursing the
Investor Group for its reasonable and documented legal expenses incurred by the
Investor Group prior to the date hereof in connection with the execution and
delivery of this Agreement by the Investor Group and its related prior
activities, provided that in no event shall the Company be required to reimburse
the Investor Group an amount more than $50,000.
[SIGNATURE PAGE FOLLOWS]
Very truly yours,
RED ROBIN GOURMET BURGERS, INC.
By: /s/ Annita M. Menogan
-------------------------
Name: Annita M. Menogan
Title: Senior Vice President and
Chief Legal Officer
Accepted and agreed to:
SPOTLIGHT ADVISORS, LLC
on behalf of itself and its affiliates
By: /s/ Francis Ruchalski
--------------------------------------------
Name: Francis Ruchalski
Title: Comptroller
CLINTON GROUP, INC.
on behalf of itself and its affiliates
By: /s/ Francis A. Ruchalski
--------------------------------------------
Name: Francis A. Ruchalski
Title: CFO
EXHIBIT A
When a quorum is present at any meeting for the election of
directors, a nominee for director shall be elected by the stockholders at such
meeting if the votes cast "for" such nominee's election exceed the votes cast
"against" (or "withheld" from) such nominee's election (with "abstentions" and
"broker non-votes" not counted as a vote either "for" or "against" that
director's election); provided, that directors shall be elected by a plurality
of the votes cast at any meeting of stockholders for which (i) the secretary of
the corporation receives a notice that a stockholder has nominated a person for
election to the Board of Directors in compliance with the advance notice
requirements for stockholder nominees for director set forth in Article SIXTH,
Section C hereof and (ii) such nomination has not been rejected by the company
for any reason or withdrawn by such stockholder on or before the tenth business
day before the corporation first mails its notice of meeting to the
stockholders. In the event the votes cast "against" (or "withheld" from) the
nominee exceed the votes cast "for" such nominee (with "abstentions" and "broker
non-votes" not counted as a vote either "for" or "against" that director's
election) (a "No Vote"), the resulting vacancy shall be filled only by a
majority vote of the directors then in office, though less than a quorum (and
not by stockholders), and the directors so chosen shall serve for a term
expiring at the annual meeting of stockholders at which the term of office of
the class to which they have been elected expires or until such director's
successor shall have been duly elected and qualified. In no event shall the
Board nominate or elect a person to the Board who has received a No Vote
subsequent to the adoption of this provision.
EXHIBIT B
RED ROBIN APPOINTS ROBERT AIKEN, LLOYD HILL, AND STUART ORAN TO THE
BOARD OF DIRECTORS COMPANY WILL SEEK SHAREHOLDER APPROVAL FOR MAJORITY VOTING
STANDARD FOR UNCONTESTED DIRECTOR ELECTIONS "STANDSTILL AGREEMENT" SIGNED WITH
CLINTON GROUP AND SPOTLIGHT ADVISORS Greenwood Village, Colo. -- March 4, 2010
-Red Robin Gourmet Burgers, Inc., (NASDAQ: RRGB) today announced the appointment
of Robert Aiken, Lloyd Hill and Stuart Oran to its Board of Directors. "As we
have previously announced, the Company's Board of Directors has been proactively
taking steps to enhance governance and has been reviewing new board member
candidates with industry expertise. Today, I'm pleased to welcome Bob, Lloyd and
Stuart to the Board of Directors. Each individual possesses a significant amount
of foodservice experience and I look forward to their future contributions to
Red Robin and the Board of Directors," said Pattye Moore, Red Robin's recently
appointed independent Board Chair. "In addition, we are seeking to add one
additional experienced director in the future."
Robert Aiken is the former President and Chief Executive Officer of
U.S. Foodservice, Inc., one of the country's premier foodservice distributors,
with annualized revenue of approximately $20 billion and an array of services to
more than 250,000 customers. Under his leadership, U.S. Foodservice has
developed an integrity-based culture committed to helping customers win, and
promoted industry-leading food safety and quality assurance standards around the
world. Mr. Aiken joined U.S. Foodservice in 2004 and held several senior
executive positions including President and Chief Operating Officer and
Executive Vice President of Sales/Marketing and Supply Chain, before being named
CEO in 2007. Prior to joining U.S. Foodservice, Mr. Aiken held numerous
executive positions in the food processing and distribution industry. He began
his career as an attorney. He holds accounting and law degrees from Georgetown
University.
Lloyd Hill is the former Chairman and CEO of Applebee's
International, Inc. Mr. Hill joined Applebee's in January 1994 and served in
numerous executive and board positions including chief executive officer and
chairman of the board until his retirement in September 2006. Under his
leadership, Applebee's grew into the largest casual dining concept in the world,
with nearly 1,900 restaurants in 49 states and 17 countries. In 2005, Hill was
named by Institutional Investor magazine as one of America's Best CEOs and as
one of the top-performing CEOs within the restaurant industry. He also was named
2005 Operator of the Year by the operators-readers of Nation's Restaurant News.
Prior to joining Applebee's, Hill served in executive positions at Kimberly
Quality Care and Marion Health and Safety. Mr. Hill is on the board of numerous
professional and community organizations.
Stuart Oran is the Managing Member of Roxbury Capital Group LLC, a
merchant banking firm he founded in 2002, and a co-founder of Bond Street
Holdings LLC, formed to acquire failed banks in FDIC-assisted transactions. Mr.
Oran has served on the Boards of Directors of a number of public and private
companies, including Wendy's International, Inc. (WEN), Deerfield Capital Corp.
(DFR), and United Air Lines, Inc. (operating airline subsidiary of UAL
Corporation). During his tenure at Wendy's, Mr. Oran was an active participant
on the Strategic Planning Committee overseeing development of a new strategic
plan, brand reinvigoration, and a new marketing focus; was actively involved on
the Finance Advisory Committee, overseeing major asset dispositions; and was
Chairman of the Franchisee Relations Committee, established to improve
communication with Wendy's franchisees. From 1994 to 2002, Mr. Oran held a
number of senior executive positions at UAL Corporation, including Senior Vice
President-International, with responsibility for United's $6 billion
International Division. Prior to joining UAL, Oran was a corporate partner at
the New York law firm of Paul, Weiss, Rifkind, Wharton & Garrison.
The Company will increase the size of the Board to 11 members with
the appointment of Mr. Aiken as a Class I director, and Mr. Hill and Mr. Oran as
Class II directors. The terms of Edward Harvey and Gary Singer, who have decided
not to stand for re-election, shall expire at the 2010 Annual Meeting. The
Company will be proposing that shareholders approve a majority voting standard
for uncontested director elections at the upcoming 2010 annual meeting. The
Board has also approved an amendment to the Company's equity incentive plan to
prohibit actions such as option re-pricings and option cash tender offers,
without shareholder approval.
The Company also announced that it had reached an agreement with
institutional shareholder Clinton Group, Inc. ("Clinton") and Spotlight
Advisors, LLC ("Spotlight") under which, among other things, Clinton and
Spotlight have agreed not to take certain actions during a "standstill" period
that expires on December 31, 2010, or under certain circumstances, such earlier
date as defined under the agreement.
"We appreciate the Board's swift and thoughtful response to our
concerns on behalf of all shareholders," said Gregory P. Taxin, Managing Member
of Spotlight. "We believe the changes the Company is announcing today lay the
foundation for future success and growth and for the creation of significant
shareholder value."
ABOUT RED ROBIN GOURMET BURGERS, INC. (NASDAQ: RRGB) Red Robin
Gourmet Burgers, Inc. (www.redrobin.com), a casual dining restaurant chain
founded in 1969 that operates through its wholly-owned subsidiary, Red Robin
International, Inc., serves up wholesome, fun, feel-good experiences in a
family-friendly environment. Red Robin(R) restaurants are famous for serving
more than two dozen insanely delicious, high-quality gourmet burgers in a
variety of recipes with Bottomless Steak Fries(R), as well as salads, soups,
appetizers, entrees, desserts, and signature Mad Mixology(R) Beverages. There
are more than 430 Red Robin(R) restaurants located across the United States and
Canada, including company-owned locations and those operating under franchise
agreements.
For further information contact:
ICR
Don Duffy
203-682-8215
EXHIBIT 5
RED ROBIN APPOINTS ROBERT AIKEN, LLOYD HILL, AND STUART ORAN
TO THE BOARD OF DIRECTORS
COMPANY WILL SEEK SHAREHOLDER APPROVAL FOR MAJORITY VOTING STANDARD
FOR UNCONTESTED DIRECTOR ELECTIONS; "STANDSTILL AGREEMENT" SIGNED WITH CLINTON
GROUP AND SPOTLIGHT ADVISORS Greenwood Village, Colo. -- March 4, 2010 -Red
Robin Gourmet Burgers, Inc., (NASDAQ: RRGB) today announced the appointment of
Robert Aiken, Lloyd Hill and Stuart Oran to its Board of Directors.
"As we have previously announced, the Company's Board of Directors
has been proactively taking steps to enhance governance and has been reviewing
new board member candidates with industry expertise. Today, I'm pleased to
welcome Bob, Lloyd and Stuart to the Board of Directors. Each individual
possesses a significant amount of foodservice experience and I look forward to
their future contributions to Red Robin and the Board of Directors," said Pattye
Moore, Red Robin's recently appointed independent Board Chair. "In addition, we
are seeking to add one additional experienced director in the future."
Robert Aiken is the former President and Chief Executive Officer of
U.S. Foodservice, Inc., one of the country's premier foodservice distributors,
with annualized revenue of approximately $20 billion and an array of services to
more than 250,000 customers. Under his leadership, U.S. Foodservice has
developed an integrity-based culture committed to helping customers win, and
promoted industry-leading food safety and quality assurance standards around the
world. Mr. Aiken joined U.S. Foodservice in 2004 and held several senior
executive positions including President and Chief Operating Officer and
Executive Vice President of Sales/Marketing and Supply Chain, before being named
CEO in 2007. Prior to joining U.S. Foodservice, Mr. Aiken held numerous
executive positions in the food processing and distribution industry. He began
his career as an attorney. He holds accounting and law degrees from Georgetown
University.
Lloyd Hill is the former Chairman and CEO of Applebee's
International, Inc. Mr. Hill joined Applebee's in January 1994 and served in
numerous executive and board positions including chief executive officer and
chairman of the board until his retirement in September 2006. Under his
leadership, Applebee's grew into the largest casual dining concept in the world,
with nearly 1,900 restaurants in 49 states and 17 countries. In 2005, Hill was
named by Institutional Investor magazine as one of America's Best CEOs and as
one of the top-performing CEOs within the restaurant industry. He also was named
2005 Operator of the Year by the operators-readers of Nation's Restaurant News.
Prior to joining Applebee's, Hill served in executive positions at Kimberly
Quality Care and Marion Health and Safety. Mr. Hill is on the board of numerous
professional and community organizations.
Stuart Oran is the Managing Member of Roxbury Capital Group LLC, a
merchant banking firm he founded in 2002, and a co-founder of Bond Street
Holdings LLC, formed to acquire failed banks in FDIC-assisted transactions. Mr.
Oran has served on the Boards of Directors of a number of public and private
companies, including Wendy's International, Inc. (WEN),
Deerfield Capital Corp. (DFR), and United Air Lines, Inc. (operating
airline subsidiary of UAL Corporation). During his tenure at Wendy's, Mr. Oran
was an active participant on the Strategic Planning Committee overseeing
development of a new strategic plan, brand reinvigoration, and a new marketing
focus; was actively involved on the Finance Advisory Committee, overseeing major
asset dispositions; and was Chairman of the Franchisee Relations Committee,
established to improve communication with Wendy's franchisees. From 1994 to
2002, Mr. Oran held a number of senior executive positions at UAL Corporation,
including Senior Vice President-International, with responsibility for United's
$6 billion International Division. Prior to joining UAL, Oran was a corporate
partner at the New York law firm of Paul, Weiss, Rifkind, Wharton & Garrison.
The Company will increase the size of the Board to 11 members with
the appointment of Mr. Aiken as a Class I director, and Mr. Hill and Mr. Oran as
Class II directors. The terms of Edward Harvey and Gary Singer, who have decided
not to stand for re-election, shall expire at the 2010 Annual Meeting.
The Company will be proposing that shareholders approve a majority
voting standard for uncontested director elections at the upcoming 2010 annual
meeting. The Board has also approved an amendment to the Company's equity
incentive plan to prohibit actions such as option re-pricings and option cash
tender offers, without shareholder approval.
The Company also announced that it had reached an agreement with
institutional shareholder Clinton Group, Inc. ("Clinton") and Spotlight
Advisors, LLC ("Spotlight") under which, among other things, Clinton and
Spotlight have agreed not to take certain actions during a "standstill" period
that expires on December 31, 2010, or under certain circumstances, such earlier
date as defined under the agreement.
"We appreciate the Board's swift and thoughtful response to
our concerns on behalf of all shareholders," said Gregory P. Taxin, Managing
Member of Spotlight. "We believe the changes the Company is announcing today lay
the foundation for future success and growth and for the creation of significant
shareholder value."
ABOUT RED ROBIN GOURMET BURGERS, INC. (NASDAQ: RRGB) Red Robin
Gourmet Burgers, Inc. (www.redrobin.com), a casual dining restaurant chain
founded in 1969 that operates through its wholly-owned subsidiary, Red Robin
International, Inc., serves up wholesome, fun, feel-good experiences in a
family-friendly environment. Red Robin(R) restaurants are famous for serving
more than two dozen insanely delicious, high-quality gourmet burgers in a
variety of recipes with Bottomless Steak Fries(R), as well as salads, soups,
appetizers, entrees, desserts, and signature Mad Mixology(R) Beverages. There
are more than 430 Red Robin(R) restaurants located across the United States and
Canada, including company-owned locations and those operating under franchise
agreements.
For further information contact:
ICR
Don Duffy
203-682-8215