Business Context and Reporting Period
Company: Red Robin Gourmet Burgers, Inc.
Filing Type: Form 8-K (Current Report)
Date of Report: February 10, 2017
Subject: Notice of Delisting or Failure to Satisfy a Continued Listing Rule or Standard; Transfer of Listing (Item 3.01).
Financial Metrics
This filing does not contain financial data. Revenue, profit, cash flow, margins, debt, and liquidity metrics are not reported in this document.
Material Changes
The Company notified NASDAQ of noncompliance with Listing Rule 5605 regarding director independence. Specifically, Robert B. Aiken, a board member, was found to be non-independent because his brother-in-law is a partner at KPMG LLP, the Company's outside auditor. Mr. Aiken previously chaired the Compensation Committee and served on the Nominating and Governance Committee. Upon discovery, Mr. Aiken immediately resigned from both committees. The Company has since regained compliance as both committees now consist solely of independent directors.
Guidance, Outlook, and Risks
Management Commentary: The Company confirmed that a majority of the 10-person board remains independent, satisfying the requirement that a majority of the board be independent. Compliance with Rule 5605 has been restored.
Risks/Contingencies: The filing addresses a governance risk related to auditor independence standards but indicates the issue has been resolved through committee restructuring.
Key Facts for Investor Verification
- Robert B. Aiken is no longer a member of the Compensation Committee or the Nominating and Governance Committee.
- The Company's Compensation and Nominating and Governance Committees now consist of three independent directors each.
- The Company maintains a majority of independent directors on its 10-person board.
- The noncompliance was triggered by a familial relationship between a director and a partner at the Company's external auditor, KPMG LLP.