According to the Company’s FORM 10-K for the Fiscal Year Ended April 25, 2004, on April 4, 2003, the court heard arguments on a motion to dismiss and dismissed the amended class action complaint. The plaintiffs filed a second amended class action complaint on May 5, 2003 naming only the individual defendants and not the Company. The individual defendants filed a motion to dismiss the second amended class action complaint on June 4, 2003, to which plaintiffs responded. The court heard oral arguments on the matter on October 30, 2003 and in March 2004 the second amended class action complaint was dismissed. No further actions have occurred in regards to this matter since the second amended class action complaint was dismissed and, as such, the Company believes that it will have no liability in regard to this matter.
The original Complaint asserts claims against defendants for violations of Section 10(b) and 20(a) of the Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder. The Complaint alleges that as a result of materially false and misleading statements concerning Roadhouse Grill's products, operations, and financial results, the Company's securities traded at artificially inflated prices during the Class Period. The complaint alleges that the artificial inflation continued until the Company admitted that it would be forced to restate its prior overstated and inflated financial results.
NOTE: On May 20, 2002, the Court entered the Order granting defendant Roadhouse Grill, Inc.’s suggestion of bankruptcy and granting the motion to stay this action.